Thursday, 13 April 2017

Oh Vulpine.

Vulpine make cycling clothes. A year ago they raised over £1m on Crowdcube at a £6m valuation. Having now missed all of their targets, they are back for more.

What the new pitch doesnt tell you is the gap between what this company tells you it will do and what it actually does. Its rather large. Lets take a look.

The new projected turnover for 16/17 according to the company is £1.3m. It was supposed to be £2.5m.

The new projected loss for 16/17 is £(445k). It was supposed to be a profit of £242k.

Of course this round is at a higher valuation than last years - based on the extra losses and lower turnovers. Makes perfect sense.

Hell these guys missed last years projections by miles as well, so you sort of expected as much. What wasnt in the projections was this new funding round - there were no new funding rounds.

There are reasons - the wholesale didnt really work so they are now into ecommerce. Maybe that could have been worked out beforehand?

There is an excellent Q on the Vulpine Forum on CC about the effect their almost permanent discounting is having on their GPM and more importantly the inflation of their headline online sales growth. Look, anyone can produce 200% annual sales growth by cutting the RRP drastically but that doesnt mean you can sustain it if you want to be making a profit at some stage. It is, we continue to argue, where the way Crowdcube allow companies to phrase their figures. is highly misleading. This guy clearly knows his onions.  

Now you know, you can all jump in fully informed.

Unfortunately it rather dampens Crowdcube's genuinely good news story - to follow. Still my mother always said there was the exception that proved the rule.

NEWS - This pitch has now been pulled - as noted in a comment below - thanks. At last the crowd is beginning to ask some pertinent questions - Crowdcube are having a very bad April. Look guys, you need to be more selective in the businesses you put on your site. You need to cover off the due diligence with real diligence and you need to take a far more active interest in what happens to companies after they have funded with you. Cut the PR and do some real work OR you are toast in 12 months. 

1 comment:

  1. Pulled from CC after a huge amount of intelligent questioning of the founder...