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625

Just received a confirmation email from CrowdCube that included the following:
"This is the cooling off email for the first offer of shares by Freetrade Limited under its two part Crowdcube pitch. This part of the pitch has now closed to further investment and we’re in the process of completing the round. You now have the opportunity to review your investment before it is completed.

The second offer of shares will be formally made in July. If you have placed an order for shares in the second offer as well as the first offer, you will be contacted separately about that part of your investment and payment will be processed separately. You can still place orders for further shares in the second part of the pitch on the Crowdcube platform."

I was not aware of a second offer of shares in July. Where can I find more information about this?

626

Its not very clear, but they mean the second part of the round that is live at the moment.

The round was split into two, something to do with the way EIS works I believe, but essentially its two raises being treated as one, To start the second part they had to close the first, the second will be running the full 30 days.

627

Does that mean that funds for the second round will not be collected until July?

628

This confused me as well, if the shares will be the same I’ll probably want them to collect my funds in July as part of the second offer. A lot can happen in 1.5 months or more…
Unless there’s a benefit for me to having my funds taken next week?

629

I just cancelled my investment from the first round and moved it to the 2nd round for precisely this reason. :innocent:

2 Likes
630

That seems incredibly logical… I don’t see how it is fair that people can have an extra two months to pay up but pay the same price as those who will have to pay before then.

1 Like
631

One benefit of an earlier completion might be finishing the 3 year minimum holding period for EIS relief slightly sooner and therefore reducing the risk of tax relief being withdrawn in the even of of an early exit.

10 Likes
632

Unlikely. I dont believe FT will exit in 3 years and Adam and he team wouldnt exit a few weeks before a date to irk shareholders

3 Likes
633

Maybe @viktor could shed some on light on when funds for investments made during the second offer will be collected? :slight_smile:

3 Likes
634

A user PI-R asked on crowd cube the following questions yesterday for which Adam has said these have been previously answered in an earlier discussion, but unfortunately did not provide any direction to those answers.

I’m having a hard timing finding the answers to the questions posted. So hoping someone can point in the right direction?

Thanks for sharing the pitch deck. Here are a few questions:

  1. Historical underperformance vs. plan
    Here is a performance summary based on the previous round pitch deck (from around Jun-19) and FY19 audited financials
    • FY19 # Customers: ~60k actual (reading on the graph p. 14 of the new deck) vs. 102k projected (~41% underperformance)
    • FY19 Revenue: £86k actual vs. £1,456k projected (~94% underperformance)
    • FY20 # Customers: 478k projected at previous round vs. 264k projected now (~45% cut in the revised forecast)
    • FY20 Revenue: £10.3m projected at previous round vs. £5.2m projected now (~49% cut in the revised forecast)
    • Can you please provide some colour around the historical underperformance and what make you think you will be able to deliver the plan this time and get to £33m revenue in FY21?

  2. Current round valuation
    • Previous round pre-money valuation was £44m (30.2x Revenue FY19B at the time and 512x Revenue FY19A)
    • Current round pre-money valuation is £140m (26.8x Revenue FY20B and 1628x Revenue FY19A)
    • Public comps highlighted p. 25 of the deck currently trade at an average 7.8x LTM Revenue
    • How do you justify 3.2x increase in valuation between the previous round and this one, especially in light of the significant underperformance vs. projection?

  3. Use of proceeds
    • Can you confirm this round is a pure primary offering? (I would like to make sure you are not offering some early liquidity to Draper Esprit at a nice 3.2x uplift in less than a year, funded by retail investors)
    • Is the management team planning to take any money off the table? (looking at FY19 report, page 24 – the 354k share options with a strike at £0.016 that vest in 2020)
    • Can you please provide a detailed summary of expected use of proceeds?

7 Likes
635

I also did this

636

Scroll further down the discussion thread. The original poster summarises and provides links where the questions have been answered

637

I was trying to purchase shares in the first round and got caught out during the transition (Wouldn’t process payment through). Waited the 15mins and was able to purchase in the second round. If above is true about July, I’m glad it didn’t go through :smiley: Also now thinking, I could invest more…

3 Likes
638

As far as I’m aware there’s no answers to the third set of questions around use of proceeds?

1 Like
639

I just found those, I think I agree with the original poster, it kind of answers some of the questions. though perhaps not fully, some not at all. It’s something at least.

The original thread in question Join and Start Investing Today - Crowdcube

(I was unable to post it earlier)

640

So the second pitch will close in July?

641

I’m assuming this is no longer possible given that the raise has now closed?

642

You can cancel it until 22 of May

643

Will it be the same share price in the July round?

644

Yes price and terms are the same