Megathread - Crowdfunding

Overall it feels more and more like the UK companies are very small fish and that they will offer very little return via Crowdfunding for a very high risk. Not sure what everyone else’s opinion is but that’s the feeling I am getting more and more especially during these time but not only - I think this has always been the case just that this current period has accentuated it and made it clear.

Not sure there are many opportunities that have had like a x20 or x50 return? Does anyone know of any - maybe instead of the Succesful Exit Thread we should have also a Really Successful Thread. Similarly I think there is little ambition to be found in the UK to support expanding globally and everything.

Overall this GoHenry feels like a underwhelming piece of news as I was hoping that with their focus on the US and EU expansion they would be more ambitious and looking to target bigger returns on the longer term. Looks like they were content with little.

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Radu

I agree with your thoughts. I posted on the GoHenry thread here that I was disappointed they had sold out at last years B Series price of $9.75. I had hoped to have a successful exit in a few years at a multiple of this price.

I had higher hopes for GoHenry. I have had many unsuccessful investments through Crowdcube. The successful few were supposed to outweigh the many failures. If those that are doing well are snapped up at 2x to 5x times the initial investment, then they don’t offset the 10 that fail.

I’m seriously considering not making any further Crowdcube/Seedr investments.

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I totally agree with this. I have been investing with Crowdcube and Seedrs for seven years now and sadly have looked at close to all deals available. Its clear the deal flow is of extremely low quality and those with a strong brand or VC backing have crazy high valuations. Zero room for the 10x, 20x type deals.

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They didn’t sell out at last years valuations, all the shareholders which likely supported the sale to acorn still have shares and as such believe in the long term prospects of the combined company with 6m users.

What they did do, was give acorn a fair percent of cheap shares and ultimately took out all but the biggest crowdfunders. I think the 2022 valuation is significantly undervalued - as since, market has changed, recession is likely avoided, global prospects have improved, there has been at least 6 months of additional metrics and an acquisition (which acorn helped fund).

Valuations are arbitrary, but there was no incentive for anyone to give these minority funders a fair or an uplifted valuation.

Agreed - what I stil can’t fully get my head around is how is this legal? I mean, how can they make some sell but not others based on an arbitrary number of shares. It’s basically saying that they want to get rid of all poor people and just keep fhe rich. Even though they would want the same people to come back and buy their shares once they IPO. They didn’t even offer the choice, very, very weird, imoral and quite unfair for thr community that helped them build it.

I might be missing something but overall, again it seems like a muddy exit for a crowdfunding campaign.

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Radu

I’ve been thinking the same since they announced the takeover.

How can the drag along rights be legally enforced if they are not being applied equally?

I am not being dragged along with the majority of shareholders. I am part of the minority being forced out as a shareholder.

Their ultimate claim was they couldn’t have more than 499 unsophisticated shareholders - otherwise, they would have to publicly list. however, they made no effort to establish whether their investors were sophisticated or not. Crowdcube has failed to care or have any shareholder interest at heart. Also, no reason was given why Acorn didn’t publicly float - especially as they were considering a spac listing the few years prior. If they gave all investors share options at 9.75 USD - I’m sure they could have achieved that and given all the smaller shareholders a cash exit to deal with the issues they claim existed.

Complete cop-out.

Let’s see if Alex can share some thoughts.

+1 … even with EIS, it seems like an unbalanced risk vs reward (which in most cases of exit, is barely higher than returns you could have got with just investing in FANGs 5 years ago)

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Any Advanced Blast & Ballistic Systems Limited shareholders keeping track of the recent email communication?

I received the email but I think it’s a case of wait and see what happens.

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received, never invested although i think they have technology moat.

I had previously invested in the 2020 and 2022 rounds at £6.66 and £8 a share, respectively. I’m unlikely to invest in any new Crowdcube companies going forward, so adding to my existing shares in my portfolio is the current strategy where it makes sense.

The minimum £250 investment is certainly worth considering given the lack of available information pre close on the 30th. ABBS have stated the share price in the summer raise will be £8 per share, so I’ve taken the offer at £4 knowing it’s largely a stab in the dark. Albeit I’ve never seen remotely accurate projections from a Crowdcube raise to date.
The team/founders are fairly senior in age so I can image they would look for an exit in the next few years. Defence sector doesn’t look like it will be slowing down anytime soon.

oh nice bet 4 to 8, didnt know they mention that share price change before.

I have my eyes on ManiLife and Perkier as I have not looked into this FMCG area before - does anyone have any thoughts? The valuations don’t seem outrageous.

I only did Snaffling Pig a while back (they’re raising now, I know) and thinking of diversifying a bit more.

I like the brands and think they have solid products in terms of quality but they’re also more expensive and sensitive to inflation, etc.

Another very slim return. “*The Offer Price is therefore expected to be equivalent to approximately a 1.75x multiple (net of deductions) on your initial investment.”

Breaking news: Hyatt acquires Mr and Mrs Smith hotels for further expansion into luxury market

The UK is becoming very, very small, very, very fast.

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Yeah, I only have 10 shares. If you factor in EIS relief at the outset and deduct the £10/share transaction costs I think we’re looking at having doubled our money in 4.5 years. Not earth shattering but heck, it’s not a skullduggery wipe out (AKA Borrow A Boat and sooooooooo many others) either. Not that I have any choice in the matter but happy to take the money and stick it somewhere more liquid.

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Small Robot Company have just emailed about an important business and funding update happening tomorrow….Eeek

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This is where the small guy gets screwed over,as per usual!

Yeah not looking great from what I heard toward the end of the call.

https://share.hsforms.com/1uA0Bu_fDSbaFqXPI1XN81g3uojn

Small robot

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