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PremSocial

Platform:
Crowdcube
Stage:
Seed
Industry:
Internet
Location:
UK - London
Date Rated:
24/01/18
Raise:
£50,000
Equity:
6.67%
Valuation (Pre Money):
£699,625
Industry: Internet
Location: UK - London
Platform: Crowdcube
£50,000 Seed
Valuation: £749,625
Date Rated: 22/01/18

MANAGEMENT

PRODUCT

INVESTMENT
Tax Status: SEIS

Business Summary

PremSocial is a social media platform for English football fans aiming to provide a dedicated social media site and application to collect quantifiable public opinion data. PremSocial has started the platform development and is in contact with EFL players to begin creating content. This round of investment will be used to finalise the platform development, build a mobile App and to fund marketing.

Financial Overview

Date (y/e) Dec-18 Dec-19 Dec-20
Sales Dec-18£16,326 Dec-19£183,939 Dec-20£894,868
Gross Profit Dec-18£13,846 Dec-19£174,939 Dec-20£868,868
GP as % sales Dec-1885% Dec-1995% Dec-2097%
Overheads Dec-18£84,190 Dec-19£141,856 Dec-20£232,911
Operating Profit Dec-18-£70,344 Dec-19£33,083 Dec-20£635,957
OP as % sales Dec-18-431% Dec-1918% Dec-2071%
Closing Cash Dec-18£34,636 Dec-19£104,768 Dec-20£611,871

Note: This financial information has been sourced from the company on 24/01/2018. Financial data is NOT verified by Wheatfromchaff Ltd.
40%
SKILLS:
EXPERIENCE:
COMMITMENT:
Although there is some marketing expertise across the team, The Founders lack leadership and product development skills.
Although the management team seems to know the industry well, they have no previous start-up experience nor any experienced advisors to support them at this stage.
The Founders have funded all of the initial development of the platform to date but it seems that there are still no full-time dedicated personnel.
26%
MARKET:
PRODUCT:
COMPETITION:
The plan provides little analysis of PremSocial's addressable market. However, social media’s influence is growing and the e-commerce offering could represent a good opportunity.
Although the Founders have started the platform's development, it is not expected to be ready until August 2018 and there is little social traction to date.
Given the company's early stage, it could be easily replicated but the team already has connections with numerous EFL players that could provide an initial advantage.
47%
PROFITABILITY:
CASHFLOW:
RETURNS:
The company has a lean and scalable business model that could lead to reasonable net profit margins in the mid-term.
The cashflow forecast suggests there is considerable headroom to achieve break-even but there is no historical data giving credibility to these sales projections.
Valuation seems high given unproven demand but investors in this round will enjoy the most efficient tax relief and if the ambitious forecast is achieved, high returns are plausible.


Conclusion

The Founding team has little management expertise and no start-up experience and given the company's early stage, the current valuation seems quite high.

Investors in this round should note that given the current levels of social traction and as yet unproven demand, monetisation will be difficult to achieve without a significant marketing spend, therefore further funds may well be needed to enable this. If another round of investment is raised, a minimum investment of £5k is required to secure voting and pre-emption rights.

Note: We have not received a business plan from PremSocial and therefore this rating is based on the information available within the Crowdcube pitch.

Related Links

Crowdcube Pitch

www.premsocial.com

 

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