Pedal Me fail on Dragons Den but succeed on Crowdcube - with the Den outcome kept secret.

This is not about Pedal Me and their chance of success. This is about information asymmetry for investors - a topic we are red hot on. Pedal Me were successful on Crowdcube recently and they are now at least on target if not beyond it, since their funding came in. In principle their business is a great idea. 

Pedal Me raised £361k from over 400 Crowdcube investors at the end of 2018; valued at £1.5m. 

Last night's episode of Peter Jones' Dragons Den had Pedal Me as the first company up. Valuing themselves at £2m if would be fair to say they got laughed out of the Den with an offer in jest at a £250k value. There were various reasons given by the Dragons for their lack of support. All of them sound in our opinion. 

The problem we have with Pedal Me is that after filming and failing in the Den - sometime over the summer of 2018, they then appeared on Crowdcube with no mention of what had happened. They claim this is due to a contractual NDA with Jones' company.

That flags up an interesting point - when does a TV entertainment show's NDA trump the rules laid down by the FCA, who regulate Crowdcube. Crowdcube knew about the DD episode according to Pedal Me and they chose to allow the pitch whilst knowingly holding back the information on the company's DD failure. 

In our opinion, investors were entitled to know about this failure. It may not have made any difference to their decision but it is highly pertinent information with regards to an investment decision. Pedal Me could have chosen to wait until after last night to pitch and Crowdcube could have refused to accept the pitch until after the NDA ran out. Either way it would have shown respect for investors. 

Of course none of this matters, other than in principle, if Pedal Me go on to be successful. If some of last night's reservations do turn out to be true, then investors would rightly ask how withholding this information complies with the FCA ruling that equity crowdfunding platforms must not mislead people. Who chooses to release what information to investors and what to withhold, is a very current topic right now with the collapse of several large Crowdcube investments where information was not as accessible as it might have been. Sugru and Emoov being two such examples.