Crowdcube's NY starts with a Bang and Whimper as I Love Gorgeous piles into the administration buffers

As yet another expensive flop on Crowdcube heads out of the door to oblivion, we ask if Crowdcube's 1 star rating on Trust Pilot is justified. 

I Love Gorgeous raised £690k on Crowdcube in the Summer of 2016, so just over 2 years ago. Now it has been put into administration in an attempt to find a buyer. As with most administrations, it seems unlikely that Crowdcube investors will see their money again. The company has 3 outstanding charges with HSBC registered at CH. All are 4 years old and do not seem to be for large amounts.

The company had projected that in YE March 2019 it would be making a profit of £1.1m on a turnover of £4.8m. Well if you believed that you will believe anything but clearly investors did. As is alarmingly common on Crowdcube, the actual figures given to potential investors for years gone by bear little resemblance to figures filed at CH. The company was making profits before coming to Crowdcube to 'expand'. Exploded might be a better term. 

Be it bad luck, unfortunate timing, Brexit, the easterly wind or simple crass management, the outcome is a familiar one. Another business failure promoted and facilitated by Crowdcube. HNY boys.   

Rentify tempted to tell you what is not quite true

Rentify raised £1.3m on Crowdcube. Now their website declares the company has a 5 star rating from Trustpilot.

The real TP rating - the one on TP's site - gives Rentify 3 stars.

What Rentify have done is cunning. They have produced an image of 5 stars with the TP logo as if it it is the TP rating. Its there front and centre on their home page; you cant miss it. Then underneath they have written 'over 400 5 reviews', where it is quite easily missed. They do have over 400 5 star reviews. But Trustpilot produce an aggregate star rating - they are not about the 5 star or the 1 star reviews only. For example say a company has 5000 reviews - 450 of them are 5 star but the rest are 1 and 2 star. You could not claim that your Trustpilot rating was 5 star - unless you lied. It would be below 2. But you could still claim you had over 400 5 star reviews.

This is certainly misleading if nothing else. The claim is they have a 5 star rating with Trustpilot. They do not. Is that indicative of a company ethos?

Balderton Capital, major Crowdcube backers, are also one of Rentify's main funders. The company is currently late filing accounts. According to their Crowdcube numbers this year saw them leap into £1m+ net profit territory. Hope that wasnt too misleading.