Ve Interactive owed £1.3m to taxman before collapse
Ve Interactive, the British technology start-up that went into administration this week, owed £1.3m to the taxman when it collapsed.
The company, once seen as one of the UK’s most promising tech firms with a valuation of £1.5bn, had total debts of £50m when it folded, according to administrators.
Ve’s core business was rescued on Wednesday by a management buyout, leaving behind the debt-riddled entity. The company’s management and its administrators worked through the night to push through the buyout that they said saved 250 jobs.
Its administrators are now examining sales of any remaining assets in an attempt to recover debts, although creditors are expected to take a significant haircut. The £1.3m owed to HM Revenue and Customs is largely made up of unpaid payroll taxes, while most of the £50m is made up of corporate loans.
Ve’s administrators Smith & Williamson said they were seeking to “maximise the position for creditors”.
Ve’s technology uses internet adverts to nudge shoppers into completing transactions they had abandoned at online checkouts. The company expanded rapidly across the globe but repeatedly missed its own targets and continued to be lossmaking.
The Telegraph revealed last month that Ve’s valuation had been slashed from £1.5bn to £300m following an emergency cash injection that saw its founder David Brown leave after staff had not been paid. Aston Ventures investor Doug Barrowman and Mark Pearson, the founder of MyVoucherCodes, led a consortium that rescued the group, and bought Ve out of administration last week.
Job losses are now expected at the company. The lease on one of its two main London offices expires within two weeks, and Ve’s management now plans to downsize the company in order to bring it to profitability.
Ve’s revenue rose to £40m last year, up from £25.6m in 2015, but it remained unable to cover its costs. Investors had looked for a buyer, but none surfaced before the firm was put into administration.
Concha, a listed UK company that counts a stake in Ve as its main asset, said last week that several shareholder groups were considering a challenge to the process.
Ve’s fall from grace has been seen as another blow to the UK’s reputation as a start-up hub, following the collapse of several other high-profile technology companies.
