Fake news is all the rage in Equity Crowdfunding

Just when you thought it was safe to go  - BAMM - more crap hits you in the face

We wrote about this here  and now we have the finale to prove the point we made before.

Satago was one of this high flying jam tomorrow internet nonsenses we are seeing so frequently. It burnt through its money raised on Seedrs and promptly arranged a pre pack deal to sell itself out of administration. The cash realised was enough to pay off some of the creditors debts but investors lost it all. 

This was reported by none other Beauhurst as a successful investment!

They wrote - 

What happened to the startups of yesteryear?

This week has been rewarding for investors in high-growth companies: Xafinity Consulting raised £190m in its IPO on the LSE; Ramsdens raised £15.6m with an IPO on AIM; and Satago, Customade, Root6, and SecretSales were all acquired.

What they say is not untrue - it was acquired but investors might baulk at the idea that got any reward. 

This is what Jeff Lynn CEO of Seedrs said about Satago in June 2016 just after they had secured further institutional funding - it makes for great reading when you consider Seedrs claim that any of their businesses that go on to raise more money at a higher value have produced real ROI for theie investors. This proves that to be total BS Jeff -

Satago was one of the first businesses to raise funds on Seedrs, shortly after we launched in 2012 so we’re thrilled to see their on-going success. The £4.6 million institutional investment they have just raised is wonderful validation for a great company, and shareholders who invested in Satago a few years ago on Seedrs are enjoying a huge increase in share value as a consequence.”

As administrations go this one does look legit - creditors did benefit or at least they got some money back. But isnt it time that with the rise of ECF we started to consider ECF investors as creditors? As ever the only people really making anything are the insolvency practitioners.

Note - we had previously stated here that Satago raised £1m on Seedrs. This was incorrect and has been altered. Thanks to Steve Renwick for pointing this out. 

Meanwhile on another ECF Platform some good news

Seedrs funded Satago have been bought by Oxygen Finance for an, as yet, undisclosed sum. 

First round investors via Seedrs bought in at a company value of just over £100k, so there is hope for healthy return after 4 years.

The last accounts filed by the company showed hefty losses but clearly the fit with Oxygen is a good one.