This is Crowdcube's new attempt to empathise with red faced investors!

Affresol are in liquidation - we knew about this a while ago. Crowdcube now have a handy easy sympathy message for all their disappointed investors It's an improvement on saying nothing, which is what they have been doing since 2011. Maybe on these they should remove the strap line? I think our logo above is more fitting. We have written about them before here Affresol is in liquidation Email not displaying correctly? View it in your browser.

Hello XXXXXXXXXXX We understand that Affresol is now in liquidation. I'm sure that this news will be extremely disappointing for you as an investor in the company. If applicable, you should have received your SEIS3 or EIS3 form to enable you to claim any tax relief you may be entitled to and if you haven’t yet done this, we recommend you do so. Income tax relief can be claimed within five years of the year you made the investment. If appropriate, loss relief is also available under SEIS or EIS. You should seek professional advice if necessary. For more information about tax relief, please visit the HMRC website:  HMRC - 'How to claim EIS tax relief'  HMRC - 'How do I claim my SEIS tax relief' Once again, we understand your disappointment and if you have any further queries please do let us know. Kind regards, The Crowdcube Team

Capital at risk. Investments of this nature carry risk as well as potential rewards.  Click here to read the full Risk Warning. Copyright © 2018 Crowdcube Limited. All Rights Reserved. Crowdcube HQ | Fourth Floor | Broadwalk House (South) | Southernhay West | Exeter | EX1 1TS

Have a great Bank Holiday Weekend!

Hop Stuff completes its Crowdcube raise of £500k - glass half empty or half full?

Hop Stuff will be the one to watch in 2017. Prudence has left the room.

Despite being only loss making since it raised funds on Crowdcube in 2013 and having an estimated turnover of just £1m for YE April 2017, Hop Stuff have smashed their £500k target with more than 3 weeks to go. Well actually this pitch was extended but lets not quibble about facts - this is CC after all.

Congratulations to Hop Stuff for what is either a great business or possibly one of Crowdcube's best examples of just why their system stinks. Only time will tell.

The pitch was full of interesting figures - ones stretched to their limit - see here  . After we wrote about them, many were removed or altered. Some are still elastic.

We think that this will either be a remarkable success or a catastrophic failure. Their plans leave little room for anything else. On their projections, they borrow another £500k by April 2017 - or that is the plan. They then pay over £100k pa in interest which wipes out the next year's profits. Burn rate for 2017/18 is almost £2m - much of this in the fixed cost column. 2017-2018 revenues triple, partly on the back of a Swedish deal which the founder has himself admitted has not been concluded - but only when asked. 

All of this on top of the fact that as far as we can see there is no experience in the team at the £3m t/o level. Sure the beer is popular but that's just one relatively simple step. 

There is no room for error here - the 2018 profit will evaporate if the GPM increase of 2% doesnt materialise and we all know how difficult GPMs are to project accurately at an early stage. If they over trade and require more cash  - this round's valuation is likely to prevent any new equity funding. They are already highly geared, so missing revenue projections is not an option.

400 trusting souls have jumped in. Here is a toast to you all. Brave or foolhardy - we will know by the time 2018 is over. We hope that the new year brings Hop Stuff much success - god knows Crowdcube could do with some really good news.

Affresol cements another bad year for Crowdcube

Affresol Ltd have just posted their results for YE May 2016.

This company, which created a synthetic concrete for buildings, raised a small amount on Crowdcube in 2013 and has since raised over £1.5m in equity finance  - giving it a current equity funding of £2.4m.

In the Crowdcube pitch - it was shown as being in profit from 2014 and made a handsome £3.8m profit for YE November 2015 - so we assume that 2016 would be even more productive.

This was not a brand new venture on 2013; the Crowdcube pitch showed the company had completed its 5th iteration of its product in 2011. It had sales and was paying its directors £36k pa each. It also had backing from Finance Wales by way of long term loan.

So what has gone wrong?

Well we cant tell you that - its not something that basic one page balance sheets reveal. However we can tell you that to date they have racked up losses of £2.23m with 2015/16 accounts showing a large drop in debtors and losses of over £400k. The long term debt on the books has been reduced to almost zero from £260k in the previous year. The cash raised in 2015 has been invested in what the balance sheet shows as fixed assets but this seems to have generated falling sales and increased losses. There was no cash in the bank in May 2016 and no new cash has been filed at CH since.

All in all not looking too good for 2017.

Affresol show further losses but raise £850k

Affresol is good example of what happens to companies after they fund on Crowdcube.

The business raised capital on the platform in 2013  - on the pitch projections that showed a profit for 2015 of almost £3.5m. We posted on them in March this year.

Accounts filed for YE May 2015 show further losses, £320k for the year and £1.8m accumulated.

Clearly people believe in this product as the recent £245k Welsh Government grant and further funding rounds have shown.

It remains to be seen if it will deliver and if the Crowdcube shareholders who have been hugely diluted will see a return if it does.

Yet again the gap between the predictions on Crowdcube and the outcome has so far been on scale that is incredible even for this platform. Just another example, if more were needed, that all Crowdcube pitches use projections devoid of any grasp on reality.