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Asset 1005


A Suit that Fits enters the realms of fantasies and nightmares.

Simply - it doesnt. Never has done and never will. ASTF funded on Crowdcube and Envestors. Went bust, was exhumed and now sits on the edge of the hole about to slip back in. Meanwhile it appears investors may well have lost more cash. 

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This isnt a case of a poor idea or even a good one poorly executed - although execution has not been great. This is about a team who will, by looks of things, end up wanting to kill each other. A team made up of various cultures where it also appears these cultures and their differing attitudes, may have clashed. The story has more twists than a bowline.

We have written about ASTF many times - here - we may make it into a book.

Enough from us  - below is the latest mini saga  - for a read when on a boring train journey.

Since this went out, another desperate email has gone out to SHs asking for more cash.  

Good afternoon.

I am afraid to say that your help is needed, please read on.

Following the recent raise to buy out David Hathiramani and Keith Watson I would like to provide you with a candid timeline of events and the current critical position of the business.

A total of £203,000 was pledged from our investor network, however only £160,000 was actually transferred post raise.

Adjustments were made to budgets and I had every confidence with your support I could drive the business forward and deliver on the objectives outlined.

The day following the raise, David's discontentment was evident at the buy out fee achieved against the amount pledged. A series of challenging text messages were sent to me demanding more money then was communicated to our investor network,with spurious claims of historical money being owed for services rendered, only communicated once the round had closed. I held firm and committed no more then what was agreed. I believe that David's discontentment continued to put significant strain on our relationship to this very day.

During the raise I was lead to believe that the official and legal side of the buy out would take around a month, at which point David and Keith would exit and share certificates would be issued, the new board formed and a fresh start ready for all. To this date the buy out is still not complete, following taking on the role of leading the company there was little to no handover and David and Keith hold all historical investment and financial records which have not been handed to our solicitor in a timely way. It was decided that David would oversee the transaction until today when I intervened challenging why some 5 months later there has been little to no progress. I quote a part of the response here "Part of the delay issue has been due to not receiving coordinated instructions or full  responses to the various emails I have sent".

I have now arranged a call for tomorrow with our largest investor and the solicitor where I aim to understand how this process may be expedited.

The funds raised went to the company you initially invested in, DKSG Bespoke Ltd which owns the ASTF brand, and leases this to Tailored Franchises Ltd whose ownership structure replicates that of DKSG.

This is a company I am a co-Director of, holding a bank account with Lloyds Bank. I have had no access to this account or until recently up to date statements which were assured weekly, the account has essentially been held to ransom by my co-Director and the only person with access to it Keith Watson. I still await a statement for June to have full visibility on the outgoings and an understanding of the true current balance despite requesting it one week ago today.

On inspection of historical statements I see David has paid himself £17,700 in recent months, a figure I am yet to receive any justification for and was not agreed with me, his co-Director.

The impact on the business as a result of this has been significant. £50,000 of the amount raised was intended to fulfil the outstanding orders, as communicated during the raise I was unable to take any new orders until we made a start in completing the historical ones, as such we have not taken a single new order this year and funds raised have been used to sustain the business in the hope the buy out would complete, we could make old orders, take new ones and commence trading again using every penny for the purposes communicated.

The constant stalling with the buy out has been detrimental to the business to the point where Tailored Franchises Ltd has zero cash is unable to make business critical payments to suppliers or staff payroll this week.

My understanding is there is around £25K remaining in the DKSG account which would cover these expenses, however David is unwilling to release funds meaning I essentially have to close the trading business immediately unless David relents or I am able to rally support from you, our investors.

In recent months operating costs have continued to drop and if we expedite the buy out and raise a relatively modest amount of cash I believe we still have a business that can essentially flourish, however I am effectively fighting for something that I am not drawing a salary for and have committed not to in the upcoming months.

Short term (as in the next 24 hours) I need to raise £50K to see us through the next month, by which point I would expect us to be self sufficient and be able to commence trading again.

I have looked at institutional lending for which we are not eligible however I believe we would be eligible for a Funding Circle Loan. This is a high interest loan that requires a personal guarantee. I am happy to offer this personal guarantee such is my belief in the business. I am also looking at a personal loan so I can contribute where necessary and claim back when the business is back on its feet.

I appreciate the context of this email is startling, I frankly feel quite startled also and like I have been fighting a losing battle against people presently yielding more power than I. Whilst late in the day felt it appropriate to reach out in an attempt to rally support before it is too late.

I understand there are likely to be many questions, whether I/Tailored Franchises achieve the mission outlined here. I would like to invite you all and openly invite David Hathiramani and Keith Watson to an event on Tuesday 8th July whereby I /we can answer any questions or concerns this email may raise or how the companies persistent failings lead us to this point, in the interim my sole focus must be survival so please forgive any late responses to questions etc.

In exchange for £50,000 raised in the next 24 hours. We offer BOTH 10% equity in both businesses AND complete complete payback of the amount you support with at this stage over 12 months next year - a modest liability to the business of £4,166.66 a month.

You can commit from £500 up to the full £50,000, funds will need to be received by the end of tomorrow.

If you wish to support please just reply to this email and I will come back to you immediately, any other questions please email ..............................(my other account) and I will come back to you when time permits.

I thank you for your time and will send a progress update tomorrow.

Kind regards

Daniel Warwick 

Friday June 28, 2019

Hardman and Co’s Brian Moretta in conversation with ECF Buzz Founder Rob Murray Brown on start up investing, equity crowdfunding and what’s a good read.