Did anyone see Vitracash? They produced a 9 page pitch deck with 1 header page and only 2 pages about their business plan and how theyād spend the money.
Still they managed to Ā£306,152 & 612% of their target. Astonishing!
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Interesting, thanks for posting.
[ā¦] Zing Zing said that āhaving grown from two sites to fourā it was ānow raising funds for further expansionā.
The investor said Zing Zingās business plan led him to believe the investment was to be used to open new sites. When this did not happen, he complained that the pitch was misleading.
I am all for greater DD by the platforms! However, I am surprised CrowdCube lost this case as āraising funds for further expansionā doesnāt sound like it necessarily refers to new sites per se, even in the same sentence as āhaving grown from two sites to fourā. Moreover, the statement refers to the future, which any investor should understand is subject to uncertainty. Strong directors and managers can change plans as the business environment changes- itās just a thing and can be essential for the companyās survival.
The decision implies a duty on platforms to conduct plausibility tests on forward-looking statements made by fundraisers ā¦
Iād much rather platforms focus efforts on verifying facts and material information related to the present and recent past. Stuff like:
- Claims that defy GCSE physics
- Recent sale of equity/investments at wayyyy lower valuations
- Missing historic financials
- No competitor analysis or misstatement of competitor costs/disadvantages
- Directors with multiple undisclosed past bankruptcies
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I hadnāt realised somebody above had already posted the ombudsmanās findings:
Itās interesting, basically CC didnāt act in their customerās interest because they only checked the pitch and not restricted documents. The restricted documents are external and thus CC claim they are exempt from their duties to the customers. However, itās not hard to check the restricted documents so itās reasonable to expect some DD on these.
In this particular case the restricted documents did state that half of the raise was for new sites leading the investor to believe that āexpansionā in the pitch meant new sites. The investor wanted a buy out when this was apparently not the case.
So I do agree with you that investors should accept that directors can change direction and companies fail; particularly startups.
But I didnāt, naively, realise CC didnāt do DD on restricted documents. So whilst Iāve invested in CC I am on the side of ombudsman in this case and maybe more. Iād prefer CC to survive as it helps retail investors back some great companies (FT, Revolut, some ethical companies, and some local companies, etc), and allows use to get in at an early stage, itās still not a level playing field with VCs because we apparently canāt do proper DD or get into the boardrooms. Thankfully, some raises are very involved with the founders answering questions and doing online AMA which is encouraging.
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I donāt think this is naivety. Weāve become accustomed to financial companies having to consider our best interests. Hiding behind the āwe only check some of their documentsā was never going to pass the ombudsmanās criteria for looking after the investors best interest.
ltāll be interesting to see how many of the investors will be pursuing a refund, Ā£13m might be more than CC could afford and then every other crowd funding failure on CC could be up for a ruling.
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Do anyone know how TRIBE is doing from crowdcube or is it another fail
It looks like they hadnāt filed their accounts so had a compulsory strike filed and removed. Iām a fair way from an expert but isnāt doesnāt seem like a good thing.
They sent out an update this week and it seemed mostly positive.
Q1 2021 saw growth of 40% compared to the same period in 2020, particularly exciting as the pandemicās effects were not fully felt until Q2 2020. We are currently 15% ahead of 2021 Targets and on track to hit our 2021 revenue target.
Well spotted, although their financials were filed late (21 Dec 2020 instead of 30 Sep 20 I believe), but long before the first gazette notice for compulsory strike (18 May 2021), so canāt beleive that would be the reason for it. Might have been to do with their confirmation statement being late, but that too was filed before the first gazette notice (13 May 2021).
The compulsory strike was also discontinued the very next day (19 May 2021) citing ācause has been shown why the company should not be struck off the registerā and it references the date of the confirmation statement filing, 13 May 2021. Sounds like an error from the registrar to me.
Sounded like theyāre gearing up for another round this year - hopefully doubling the valuation once again
I am not an investor in either MD or GI but I would have thought they were doing ok. Do you mind sharing your thoughts on them?
A lesson I learnt from Den (smart switch) was to be weary of companies that keep coming back for more funds year after year without institutional backing. Having institutions on board doesnāt necessary mean itās all smooth riding but it does reduce some risks to a degree. I notice a lot of companies market crowdfund as pre-institutional funding but never materialiseā¦ false promiseā¦ Den was such case
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Just went onto the forum and saw that the founder sold Ā£2m worth of shares in the Seedrs secondary marketā¦ thatās impressiveā¦ surprised that there is that level of liquidity for the shares in the secondary!
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Cheeky panda already 50 pounds a share, and I bet you if they list on NASDAQ
Would struggle to be 20 pounds a Share.
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Glint
Open a freetrade account, buy a gold etf. Want to spend that gold? Sell some of your gold etf and transfer the cash into your bank account.
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The most negative thread Iāve seenš. Itās fine if itās as a cautionary tale to let people know the risk of investing /highlight undesclosed worries in companies that are crowdfunding. However, to dog on companies seems a waste of energy
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Here here. I donāt see what is to be gained from slating a company who arenāt raising (separate thread for this).
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This forum has created a new expression - leave Brian be Brian 
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The mattress company? Just seen a Google advert for them saying they have sold 500 units, when you click through it says 500,000. They are either understating their success, or bad with numbers 
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It could be European, where they use a comma instead of a decimal point.
500.000 beds sold means that they didnāt miss anything off the 500 beds they sold and didnāt accidentally include other things.
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