Emoov sailed effortlessly over its £1m target in its latest crowdfunding campaign yesterday within hours of its public launch, and saying that it expects to be in profit in the 2020/21 financial year.
By this morning it had raised almost £1.2m from some 340 investors after the campaign was a private invitation-only affair for the previous 24 hours. The campaign still has 29 days to run.
In its pitch on Crowdcube, Emoov says it will spend the money on marketing, developing its technology and “maintaining a world-class team”.
Emoov also confirms in its pitch its intention to float on the stock market by the first quarter of next year – prompting a question in the discussion pages: “If you’re about to go public, why are you raising £1m (a fairly small sum relative to previous rounds) now?”
CEO Russell Quirk replied, saying there had been “multiple requests” from existing small investors, customers and staff for the opportunity to invest.
He said that at flotation, he would expect the value of the company to be in the region of £120m to £150m.
Quirk also said that he would consider international expansion “in due course”.
He also responded to another query, asking for more clarity on financial projections, specifically that revenue is expected to increase by 550% in 2019.
The questioner asked what the projection is based on, given that revenue growth between 2017 and 2018 was nil.
Quirk replied: “Projections are a forecast of where we think the business will be and based upon a number of aspects that we are confident in.
“Our marketing team is now a significant entity and run by the former UK marketing director of Just Eat . . .
“Importantly, we have a) only just rebranded the Emoov business and b) only just begun our TV and radio ATL campaign in earnest.
“The resulting performance of the Emoov business in particular is impressive with website sessions, leads and valuations booked hitting records on numerous days in the past two months (yesterday was the best ever day for new LPA valuations booked by far, for instance.
“Moreover, our brand awareness is now growing more strongly than any other digital estate agency business including Purplebricks (Source: YouGov). We have now reached a specific awareness milestone and have reached it faster than PB did.
“We also have a significant war-chest of media spend, something that we did not have until the May merger. Channel 4, Channel 5, Sky etc are all partners in our journey now and there is a significant spend here (£9m over the next few months) that together with our digital performance (we are the UK’s number one ranked online estate agent on page one of Google) we are set for big growth now that the brand, media spend and team are in place.”
Asked when the business expects to achieve profits, the reply was: “We expect to be in profit in the 2020/21 financial year. As with all growth businesses (Uber, Amazon, Twitter, Tesla, Ocado) the quest for scale is absolute and comes at the expense of short-term profit.
“Our investment in technology (£4m+ to date), marketing (especially ATL, TV etc) and people is huge. If we focus on short-term profit we will not grow and will not compete at a high level and will not add value.
“Incidentally, we made profit in 2012 and 2013 up until the point that we chose to ‘go large’.”
Comments (18)
I don’t know if I’m on my own here but I think the marketing colours and logo look terrible!
With a recession looming at the end of 2018/ start of 2019, this is possibly the worst time to buy into a unprofitable prop tech company.
Although I do foresee the recession helping hybrid and online more so than traditional agencies due to the fact that there will always be a need from the public to move (3 d’s.) In recessions savings are seen more favourably. Especially if one would be moving out of need rather than desire.
If you are looking to invest long in the property market, now is not the time, After the looming recession clears – one of PB, YOPA and Emoov will kick on and become the outright leader for the whole UK property market. Any investor with a choice of the 3 will choose PB right now despite the current 10x comparable valuation.
If you want to DYOR on the upcoming recession look at this post from LinkedIn on London property prices (we all know London gradually effects the whole UK housing market.) Look up Elliot Wave Theory and thank me later.
https://www.linkedin.com/feed/update/urn:li:activity:6419322319302459392/
Literally never seen a property marketed by emoov. Just saying.
Yo tampoco.
That’s Spanish for “me neither”.
Investors money to be use to “maintaining a world-class team”
Does this mean Mr Q’s bonus pot?
To be fair if you pledge 5k you get 50% off selling fees for 1 property!
Where do i sign?!
Is that what they offer? 50% off selling fees if you pledge £5k? Not a bad idea to be honest. Allows him to increase his list of vendors and create a large list of advocates who are invested.
This really is all smoke and mirrors! Emoov are listing at best around 500/month, a good number of which are now only paid on completion. And this is with a significant amount of current TV advertising. They have miles and miles to go to reach anything like the scale needed, which will very quickly, as has been proved already, soon gobble up all those poor investors millions !
Does this man just spout the first thing that comes into his head?
Do investors just like handing out cash to lost causes like addicted gamblers hoping one day to get their money back?
Cheap Estate Agency fails every time; especially if there is a turn in the market.
Cash is king and this guy seems not to have any!
When investors realise these businesses cannot make a profit they will flee.
History
“Online estate agency now comprises 8% of the industry having risen from 2% only two years ago. It is amazing how far the online estate agency sector has come.“
“as a market leader, will culminate in the online sector taking around 50% of the UK estate agency industry by 2020.”
http://www.propertyindustryeye.com/emoov-set-to-raise-1m-and-says-firm-is-worth-20m/
I wish Russell, his staff and his investors well but, the oft quoted market share stats and growth forecasts have yet to materialise.
“2016 will be the tipping point”
50% of the UK estate agency industry by 2020.” –
Seriously what planet do these guys live on?
Also, with all respect, each investor has piled in with a whopping average of £3500 ish each, hardly the £125million that Purplebricks got from one investor.
Didn’t a football club do this recently, get their fans to put in a few thousand each to stop the club going under?
Hartlepool did – its a bad example!
I’m no fan of the onliners – but i’d rather invest my money there than in HPFC! #UnbelievableJeff
Cheese.
Maybe my mind is wired up @rse-first today – but I would have said that it was a perfect example!
What am I missing?
Portsmouth did it and it worked very well indeed
Jeeeeeersus! Have these investors learnt nothing after ploughing endless dough into PB for very little return?
What is Emoov’s USP? An online agent looking to buy hundreds of Countrywide’s failing High Street offices?
Confused message? So hey, let’s pile in with investors hard earned money?
Beyond belief……
Revenue will undoubtedly increase over the next year as they are merging with Tepilo, so buying in a portfolio of 1000 properties or whatever will naturally bring in more dosh. 550% tho is pure fantasy. Someone yesterday said that these investor types are shrewd and intelligent….if they believe this spin then i would have to disagree.
At least the end game is now public, the desire to float, jealous of the “success” of the Purple ones…time will tell.
That would mean more expense taking on the portal fees, got to be around the £10k a month for 1000 properties.