MyGravity sold to Loyalty Angels but nothing about it on Crowdcube

In a highly significant move, one of Crowdcube's recently successful pitches has been sold to Loyalty Angels. A fact we missed back in the Spring of 2017.

The odd thing here is that we can find no mention of this momentous exit anywhere apart from on MyGravity's Chairman's Linkedin page where he states - 

Last Friday Loyalty Angles Ltd completed on the acquisition of MyGravity Ltd - of which I was Chairman, which owns a Loyalty App called My360. This is a great deal for both companies and we achieved an excellent valuation for MyGravity's shareholders. Congratulations to all involved and good luck to the combined company. 

We have taken a hard look for the anticipated PR that a 'excellent valuation' for Crowdcube investors would generate. But there is nothing. Not one piece. That's why we missed it. Recent accounts filed this month show the company made further losses, had failed to raise the money that they predicted and were as at March 2017, insolvent. This was just weeks after the company changed hands. The only reason we know this is because the last confirmation statement shows all shares have been transferred to Loyalty Angels.

Greg Gormley seems to have been the man behind the move. He is the single largest shareholder in LA and was made a director of Mygravity in February 2017.

For some light relief, the last Confirmation Statement for LA states that A Shareholders get 'One Vole per share ' which will give Mr Gormley 340,000 voles. And I thought Bitcoin was a little risky.

We asked the ex Chairman to comment - we'll let you know what he says. Maybe something from Jeremy, at Tales of the Riverbank would be appropriate. 

Despite what we said, Brewdog slams through its £10m in under 100 days

In what looks like a surprising result, Brewdog will now easily get to its minimum target of £10m raised in the final 4 days of the BFP5 campaign.

We say surprising as for the best part of 70 days of this 100 day campaign, it looked less and less likely that the Dogs would get over £8m, let alone £10m. 

Back in October 17, there was a good steady stream of investment up around the £100k per day level. Then around the middle of November it started to slowdown and by December it was nearer to £50k than £100k per day or around half the required rate. So from 20 December, the amount still to be invested was £2.9m - around £110k per day. But the daily input was stubbornly stuck at around £50k. 

By the 5 January Brewdog still required £1.8m in just just 11 days, with the trend heading the other way. But those boys just dont ever give up and since, they have raised all but £400k of that amount, with the last two days seeing £750k coming in.

This is certainly not a pattern we have seen before in any ECF campaign in 6 years. Yesterday for example saw 536 investors when the average per day has been just over 200. This campaign is run by Brewdog, not an independent platform. So how they have turned this around we will never know but it is some achievement.

Hats Off.  

Rumour is Hopstuff is looking at a listing and selling off some assets for a new project; as well as a new raise.

Ambition is a wonderful thing - in the right hands. Leave the nest too early and you will likely end up dead. 

We have written a few pieces on Hopstuff, it has to date been a success - an almost unique situation for a Crowdcube funded business. But now we hear that the founder has asked for advice on a listing in the next 12-18 months and raising some cash against assets - for a new project.

Hopstuff doesnt make money in the real world - its projections do. Its current valuation of £14m is based on what might happen next. We think there is a good chance that the required happenings may come about but only if they concentrate on getting there....not something else. The company is talking about a new raise early this year - as well as the news on a listing and asset sale. Profits are projected  - they always are. 

Their plans are already very ambitious - and have taken a slight fork. They are now due to be opening bars (taprooms they call them) in number, even though the original two have not yet been truly tested. We did suggest to him that he might want to rein in the ambitions a little and consolidate but like most entrepreneurs he knows best. He still thinks his comparison to Brewdog is a valid one. 

So why the headlong rush? Is it a Millennial thing?

We dont know. But we do know that the reason that many successful early stage businesses go bust is because they over trade. They over extend their risk based on false, often untested assumptions. He must have his reasons.

Now is not the time for new projects or enquiring about future listings. Now is the time to deliver on your last set of projections and for ensuring as far as possible that plans for new openings work. It's like they havent learnt a thing from the delay in opening the new brewhouse and the lease issue with the Taproom - things never go to plan. 

How many businesses have we commented on that have had similar ambitions that have failed miserably. Taylor St Baristas, River Cottage, Rushmore Group, Ethos Global, One Rebel, Hen Restaurants, Pizza Rossa, Chilango etc etc have all promised and tried to expand via new openings and all have failed - some with dire consequences. We cannot list one that has succeeded to date, apart from The Dirt Factory, who 2 years after funding have still not opened their first unit. Getting it right is not easy and for sure out of 5 new units, one at least will end up a dog for reasons that are perhaps not even apparent now. Well that's our experience from 30 years opening new units of various kinds.

The hazards are many  - all untested by Hopstuff. The rewards enticing. 

This will of course fall on deaf ears. But just so we can say told you so. Alternatively you the investors might want to drop him a line. And of course, if we are wrong, then much humble pie and hat eating will be on the menu. Our record speaks for itself.

The demise and resurrection of some old crumpet

Crumpet Cashmere took £150k off Crowdcube investors in 2014. Pippa you know who, 'loved ' their stuff. After a liquidation that has taken 2 years, the same founder is still running under the same name, racking up more losses and more debts.

How is that possible?

The founder Dana Juricic has now tried this game several times. We wrote about her here . Back in 2014 she arranged a pre pack deal for her first attempt, Crumpet England which had gone down owing £750k.

So when in 2015, a year after taking Crowdcube's money, she was failing again, she arranged the sale of all the company's assets to a company recently set up, called Ruby and Rude Ltd. She is the owner of Ruby and Rude. She paid £36k for the assets which she had had valued. The company debts were over £400k.

The liquidator, Mr De'ath - can this get any crazier? - accepted this deal!

Now Dana is trading as Crumpet Cashmere Ltd, even though this company no longer exists. 

Whatever - as you might expect the newco which is really called Ruby and Rudy Ltd, is loss making and she is piling up some new debts which she can run away from when the time is right. 

This one might make a movie.

Kokoon - what the hell is going on hear?

Kokoon are a mystery. They have raised enormous sums based on a product that is still to be completed and the Kickstarter crowd are baying for blood. We did warn you Crowdcubists.

We all know that Kickstarter projects get delayed and some never deliver. But it is unusual in our experience to find one that has pre sold on KS to the tune of £2.8m, with delivery for February 2016, and that then has raised £1.65m on Crowdcube in August 2017 and has to date failed to deliver anything other than excuses. In this Crowdcube pitch they, Kokoon, promised the product was now ready for sale and talked about a large retailer's purchase order arriving 'in weeks'. Delays were over. Regretably, that was all a lie.

We warned readers that the project was on the cusp of coming off the rails. Not because the product isnt any good or because it is some elaborate con. Simply because the guy running the show is a shambles. You still invested. 

Now, as yet another deadline for production passes by like some endless goods train pulling into Port Headland, the volume of complaints on KS and the number of demands for full refunds, has risen substantially. There is still no set date for completion of the first production run  - in fact there is no set date for its start. The product has changed (for the worse according to backers) beyond recognition. The £2.8m pre order cash has all been spent and this must now be considered a liability given none of the headsets have been delivered and people are asking for their money back. It is all going rapidly to shit.

Here are some of the recent comments - 

.............................................................................

now, actually after a few month it became very obvious that project management isn't our developer's best skill ... so I didn't mind about all the delays and changes through the years. But from the first design concept I had hoped to get headphones which would be suitable to use while sleeping, especially as a side sleeper. I think the (almost) finished project is far away from that point ... and that is the real issue.

I sent a direct message to @Tim as well as the project yesterday asking for a refund. Tim came on 3 hours ago and didn't reply to my message. I also tried to send an email to the kakoon.io email address provided, but it is not valid.

Long story short, where is my refund?

Please do not ignore us.

I’m backer #12, I have lost faith on your product and your updates full of excuses. I would like to get refund!!!

Can someone call the police in England? Tim Antos is the name.

One word comes to mind....shameless.

According to your crowdcube documentation you envisage the headphones having a life of a mere 2 years - your backers have waited significantly longer for the product to arrive.

You need to stop the excuses & deliver what you promised.

When are y’all gonna get it? This isn’t “miscommunication” or “unforeseen” anything. They knew when they made that video they were misleading us. That they didn’t have the product anywhere near the level they said they did. Maybe they HOPED they could deliver, I don’t know. But they knew they weren’t presenting things as they were. They’re liars. Quit appealing to a conscience that they don’t have.

....................................................

There are 2,400 comments  - most of them negative. It is what happens when you have a product developer in charge of a business - chaos. Kokoon for your own sake please ditch Tim and get yourselves a real CEO before it all goes tits up.

Has Autotrip lost its way with the latest accounts

Autotrip have raised equity finance twice with Crowdcube - from what appears to be 500 shareholders, they have a total raised of £490k. Or so we thought.

Looking at the latest filed accounts to YE Mar17, they appear to have virtually no equity finance - or £202 to be precise. This is some achievement considering last year they had £137,516. The latest confirmation statement confirms they still have 500 shareholders. 

A little odd.

We wrote about them before here 

In the so called accounts for YE Mar17, they declare a profit of over £250k which is clearly complete nonsense, given the fact that in that year they raised another £435k on Crowdcube, which as we know has not been shown. This might be a timing issue but the original share cap of £137,516 has vanished. In fact, figures from the previous year show that the latest accounts are totally wrong.

So either they have filed false accounts or they haven't a clue how to file accounts - possibly both. If I was one of the 500, I would like to know either way. Accounts are important for companies - even in this crazy world. 

Alexander Nicholson, the lead in both Crowdcube raises, has resigned. Hmmm.

SHOCKER!! Crowdcube outdo themselves with collapse of Myshowcase.

We can hardly believe this story. Just 12 months after raising £1m from Crowdcube investors, Myshowcase is closing down.

Here's how Crowdcube promoted the business in January 2017 -

• Experienced team with proven track record of business exits
• Over £2.75m equity raised to date, investors include 24Haymarket
• Named one of The Sunday Times’ Top 15 fastest growing startups in 2015
• #2 best online beauty retailer by The Independent, 2014

Crowdcube included them in their list of alumni who have cracked the £1m raise ceiling just two weeks ago! Looks like this has now fallen in ...............

https://www.crowdcube.com/explore/2017/12/18/the-1m-club-where-are-they-now

The CEO Nancy Cruikshank (typo?), can be seen and heard allover the internet in her role as the ultimate guru for female entrepreneurs. Lets hope most of then do not take after you Nancy.

Here is the final email sent to investors -

Regrettably, we announce that MyShowcase will close at the end of January 2018. MyShowcase is solvent so we will be able to pay everybody and will leave no debts at all upon closure.

Since we took our first order on May 29, 2012, over 47,000 customers have benefitted from our personalised beauty shopping service. Over the years we have been recognised by our peers for our innovation and achievements, including being voted the #2 best online beauty retailer in 2014 by The Independent, listed in The Sunday Times' Top 15 Start-Up Fast Track 2015 and winning the 2016 Excellence ("best company") Award from the UK Direct Sales Association. In 2017 we successfully launched the Genie, an online personalised beauty service and Beauty Elite, the best beauty loyalty programme in the UK.

Despite all this, we have been unable to achieve the necessary growth to build a profitable and therefore, sustainable business. We have been unable to raise additional funds to develop a direct to consumer business, to complement our Stylist business.

We are all very sad but we are also proud of what we have achieved, together. We would like to very sincerely thank our loyal customers, our hard-working Stylists, our wonderful Brand Partners, our devoted HQ team and our supportive investors. We couldn't have achieved so much and come this far without all of you. We wish we could have gone further, but time is not on our side.

All three of MyShowcase's Founders have invested money into MyShowcase and nearly 6 years of our lives. We fought hard to make MyShowcase a success. We are sincerely sorry that we must now agree with our Board that it's time to close the business, as it is neither profitable and sustainable or able to raise a further round of funding to go forward. If you have any questions, please feel free to email Nancy, CEO, at nancy@myshowcase.com.

With a heavy heart,
Nancy, Rodrigo & Olivier
Founders

Our Conclusion - maybe a con or maybe the management were/are complete air heads or this CC round was a last desperate attempt (we have seen this before) but no one told investors that. Not possible otherwise. Not clear if the 'no debts' statement includes you CC investors - seems unlikely though as if they had that sort of spare cash (£4m total equity finance) why would they be giving up. Nice to know your support is so valued.

We were just putting together a rather long and sorry list of all the Crowdcube funded companies with recent accounts who have failed to get close to their projections, when this bombshell landed. List on the way shortly. 

As if this farce wasnt enough, Crowdcube have yet again been caught with their pants down. They claimed to have raised over £1m for Myshowcase but the filings at CH show that the CC nominee account is for just £280k not £1m. Come on FCA, you must do something to stop these bandits.