Collapse of Vulpine begs question, is crowdfunding all it’s cracked up to be?

26 / 05 / 2017

Legal experts Amelia Villiers-Stuart and Janice Wall look at the recent demise of cycling brand Vulpine and ask whether investors had enough information.

The obvious advantage of crowdfunding is that it enables entrepreneurs and startups to access capital from a wide range of investors. Small companies, like Vulpine, that would otherwise struggle to access traditional forms of financing are therefore able to access capital and get the venture off the ground.

Crowdfunding also serves as a way to spread risk. Startups and young businesses often incur significant and unexpected costs in the early days – which can be fatal to success.

Vulpine, which was set up in 2012 by Nick Hussey, was recently declared insolvent – with the late arrival of summer stock putting it in a “difficult cash position”, according to Hussey. The business had twice turned to crowdfunding as a way of raising money, once successfully, so what went wrong?

Please click here to read the full article. This article was first published in Real Business on 26 May 2017.