Emoov predicted a huge increase in sales – then went bankrupt and caused those who supported it to suffer huge losses

Loss: the company had generated only £ 2.2 million in the 12 months to April 2018 after the growth came to a complete standstill

Emoov predicted a huge increase in sales – then went bankrupt and caused those who supported it to suffer huge losses

Jamie Nimmo, Financial Mail on Sunday

Loss: the company had generated only £ 2.2 million in the 12 months to April 2018 after the growth came to a complete standstill

Loss: the company had generated only £ 2.2 million in the 12 months to April 2018 after the growth came to a complete standstill

A few months before it went bankrupt, Emoov lured new investors by claiming that it was on track for an astonishing six-fold increase in revenue, revealing documents.

The online real estate agent collapsed in the administration earlier this month, causing major losses for those who supported his £ 1.8 million summer crowdfunding campaign.

More than 1,000 small investors stopped in July when Emoov used Crowdcube – a website that lets investors buy a small share in a non-listed company – to raise money ahead of a planned share price.

The company had generated only £ 2.2 million in the 12 months to April 2018 after the growth came to a complete standstill.

Nevertheless, in the documents issued to investors, Emoov predicts sales of nearly £ 14 million for the year to April 2019 – an increase of more than 500 percent.

Emoov went less than five months later and some investors are now threatening legal action because they claim to be misled.

The crowdfunding documents, which The Mail has seen on Sunday, have since disappeared from the Crowdcube website, which claims to be proud of transparency.

Even after companies that have collected money on Crowdcube go bankrupt, investors positions can usually remain visible.

A Crowdcube spokesperson insisted that although business locations and relevant documents & # 39; remain open to investors & # 39 ;, it is not unusual for them to be subsequently closed to non-investors.

Emoov said there was no money left after the money promised by investors had not materialized after completing a triple merger with Tepilo, the online broker of TV star Sarah Beeny and Urban.

According to the investor documents, the company had a high level of confidence in the forecasts based on the performance in 2018 so far & # 39 ;. It marked TV and radio advertising campaigns that would strengthen the public profile of the company.

Not a happy ending: Backers who have lost money are media mogul Richard Desmond and former Dragons & # 39; Den-star James Caan. Other shareholders will be swept away

Crowdfunding is a relatively new way for companies to raise capital, but has been scrutinized by the city's regulator for the risks that investors face when relying on limited information before investing.

Russell Quirk, the controversial founder and chief executive of Emoov, defended the ambitious predictions and said that they were completely vetted by Crowdcube & # 39 ;.

Crowdcube, however, struck back and said it has never reviewed the financial forecasts of companies on its website.

Quirk told The Mail on Sunday: "Emoov was an ambitious company and grew considerably year after year in most of its eight-year history. A snapshot in itself does not provide a representative image. & # 39;

But the documents show that the revenues in the past two years grew only with small margins.

It also showed that Quirk made plans to launch his own PR agency while Emoov went down. He registered Properganda Limited at Companies House just two months before Emoov went bankrupt. He also registered a company called Russell Quirk Ltd.

Quirk said he had registered Properganda and the domain name to secure them & # 39 ;, adding that he also owns & # 39; lots of other domain names & # 39 ;.

He said: "Given the huge PR coverage that Emoov achieved over the years under my term of office, it might be strange not to expand that skill to help other companies in the same very effective way." # 39;

It is intended that Quirk earlier this year the opportunity to drive on the stock market, rejected by a reverse takeover by a listed shell company shortly before his three-way deal with Tepilo and Urban.

Backers who have lost money are media mogul Richard Desmond and former Dragons & # 39; Den-star James Caan. Other shareholders will be swept away.

Those with real estate listings on the Emoov site are likely to be transferred to a competitor. Purplebricks boss Michael Bruce has already said that he will include the listings free of charge.

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