PledgeMe widens loss, misses revised forecasts

Equity crowdfunding platform PledgeMe has substantially widened its loss and missed forecasts from both its capital raising prospectuses.

Company Office records show PledgeMe made a before-tax loss of $376,315 in the year to March 31, 2016, widening 374% on the $79,333 loss in 2015.

It made revenue of $179,527 in 2016, up from $69,237 the year before.

The Wellington-based company operates project crowdfunding and equity crowdfunding services and was also licensed as a peer-to-peer lender in June.  

It has about 150 shareholders, after holding two equity crowdfunding campaigns for itself in November 2014, raising $100,000, and July 2015, raising $365,820.

During the 2014 capital raise, PledgeMe told prospective investors it expected to make a loss of $28,000 in 2015 but would reach profitability the year after, with $46,000 net profit.

The prospectus for last year’s capital raise showed these numbers were not reached, and it had adjusted its profit expectations for 2016 to a loss of $71,071 on revenue of $420,420.

Chief executive Anna Guenther was not available to comment this afternoon on why the loss has widened by so much and why revised forecasts were missed.

The results show $555,842 was spent on operating expenses in 2016, up from $168,015 the year before.

Part of the increase came from a 400% increase in salaries and wages to $337,585 (the company’s website lists seven staff members) and directors’ fees of $43,080 (nothing was paid the year before).

The company held $170,464 cash and cash equivalents at the end of March, up from $81,108 the year before.

It paid more to auditors Moore Stephens, at $17,200 in 2016 from $11,500 in 2015, but less to web developers Rabid Technologies, at $8207 from $68,560 the year before.

At the time of the last capital raise, PledgeMe valued itself at $2.1 million pre-money, which equated to $60 a share. This was based on the same valuation methodology as its previous round, of five times projected revenue for the year.

Based on that valuation methodology, the company would now be valued at $897,635.

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