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Pollen report reveals enormous debts

New documents have laid bare the financial collapse of UK-based music, travel and experiences start-up Pollen.

Pollen organised artist-curated weekenders such as a Bring Me The Horizon four-day festival in Malta, the Unruly Culture Splash Weekender in Croatia with Popcaan, Diplo’s Higher Ground festival in Cabo, Mexico and Justin Bieber & Friends in Las Vegas, US.

According to a recent Companies House filing by insolvency specialist Kroll, Pollen’s parent company Streetteam Software Limited owed £75 million (£59.4m unsecured) to creditors when it fell into administration earlier this year – just three months after raising US$150m in new funding. The group recorded pre-tax losses of £52.4m, £42.7m and £57.4m in 2019, 2020 and 2021, respectively.

“Trading was significantly impacted due to Covid-19 where a number of events had to be rearranged and cancelled,” states the filing. “This further impacted on cash flows due to the level of customer refunds that fell due.”

Founded in 2015 by brothers Callum and Liam Negus-Fancey, Pollen’s biggest creditors were Luxembourg-based investment firms Sienna Capital, owed £21,494,200, and Global Growth Capital, which was owed £18,654,365.46. Other seven-figure creditors include B&Y Fund (£1,321,235.21); Northzone IX (£9,272,678.90); Henry Costa (£1,540,000/£3,141,460); 101 Ways (£2,007,685.77); Back in Black Capital (£2,480,100); Generation Ventures (£1,653,400); Lets Go Crazy Holdings (£4,953,908.16) and Thoughtworks (£1,104,575).

Pollen had drafted in investment bank Goldman Sachs to help its bid to find a buyer before Kroll was appointed as administrator in August.

“The joint administrators anticipate that the most likely exit route for the company will be dissolution”

“Following turbulent trading conditions of the company’s subsidiaries as a result of the Covid-19 pandemic, the directors of the company had previously engaged Goldman Sachs to run a sales process with a view to a solvent sale of the group,” details the document. “A sale was not forthcoming and so the directors approached Kroll Advisory Limited to run an [accelerated mergers and acquisitions] process. No offers for the business were received on a solvent basis and so the directors took steps to enter the company into administration.”

It continues: “At this stage the joint administrators anticipate that the most likely exit route for the company will be dissolution… [They] have formed the view that once all the the outstanding administration matters have been finalised, and all liabilities incurred during the administration have been discharged, there will be insufficient funds available to allow a distribution to unsecured creditors.”

Pollen, which had 316 employees prior to its collapse, raised US$150m in a Series C round in April, only to let over 150 members of staff go in the UK and US a month later. Earlier, it raised over $100m in venture capital funding, while the UK government’s Future Fund also previously invested in the firm.

Shortly before the company went into administration, directors received a £2.5m bid for certain assets – later reduced to £500,000 – with administrators saying they “hope to complete the transaction imminently”.

Last week, it was reported that another UK-headquartered startup – festival discovery and booking platform Festicket – owed more than £22.5m to creditors at the time of its collapse last month.

 


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