Wynyard Group capital raising?

[blobbles]

Long story short from my memory:

They started recognising the next years revenue before it had come in. It didn't come in during the time frame they recognised it. Which led to a shocking loss of confidence in management.

Then management started not informing the market in a timely manner.

At the same time, reports started coming out that their application didn't do what it said it did. Which rightfully scared a lot of us out of it.

I think these three events, particularly the first, sent them into a death spiral which they could not recover. The SP dropped badly with each subsequent screw up and it soon became obvious that they were basically insolvent. A last ditch ($10m I think?) bridging loan was secured, which still wasn't enough to pay the bills.

When you are funding yourself through capital raisings, running at a loss to grab market share, you need to keep honest as the number one rule. You need to work hard to keep customers and cash flowing in as number 2 rule. And you need to build a damn good product as a number 3 rule. Sometimes you can change the order of the rules, but if any of them slip, you are in trouble.

Compare with Xero who built a brilliant product, were well managed with incredibly hard working staff and management who in turn were completely honest. They attracted big and small investors with this strategy.

[SilverBack]

For Wynyard to make a cash raising as equity so close to their failure is an indictment (to me) against the Directors. Perhaps they were just incompetent as some have claimed here but that should not absolve them from responsibility as directors. I wonder how many investors thought that a CR meant that the company was a going concern and then invested, when clearly it was anything but?
If you want some other background on the woes at the company prior to failure then read some of the comments on glassdoor.co.nz from staff.

[SilverBack]

Is the class action against the company and its Directors still active?

[zgnz]

If I remember correctly, the tech-growth narrative fell apart pretty quickly. They were projecting something like 40-45m in the last FY, think it came in around mid 20's million (e.g. little to no growth from previous year)

Management kept blaming the 'lumpy' contract timings, falling outside the announcement dates etc etc. The 'large' pipeline of leads never actually eventuated into closed sales.

They were spending like a hot tech startup. Flash new office spaces, hirings etc.

Product was very average. (Ultimately the main problem.)

It rode some of the xero-hype wave around the time, along with GeoOP.

[mondograss]

If I remember correctly, the tech-growth narrative fell apart pretty quickly. They were projecting something like 40-45m in the last FY, think it came in around mid 20's million (e.g. little to no growth from previous year)

Management kept blaming the 'lumpy' contract timings, falling outside the announcement dates etc etc. The 'large' pipeline of leads never actually eventuated into closed sales.

They were spending like a hot tech startup. Flash new office spaces, hirings etc.

Product was very average. (Ultimately the main problem.)

It rode some of the xero-hype wave around the time, along with GeoOP.

Orion Health management tended to do much the same.

[Balance]

Orion Health management tended to do much the same.

Lost a fair bit of money with Provenco (sold out for a big loss before it went broke) and learnt my lesson - so steered clear of the hype with Wynyard, GeoP, Orions etc - actually posted my warnings too on their threads.

What did I learn from Provenco?

Lumpy deals won with built in long tail service and maintenance (upgrade) contracts are a recipe for a company going broke, especially when the companies are tendering against established players.

That's the story with Provenco, Wynyard and I would venture to add, Plexure.

[Snoopy]

I’m trying to understand what went wrong with Wynyard (I wasn’t an investor but want to learn from them). I’d like to read their old annual reports, but they’re not on the NZX anymore. Anybody got a copy they could send me?

MtGox, I think there is a requirement for NZ companies to file their annual reports in some form at the National Library in Wellington. If all else fails, perhaps you could try there?

SNOOPY

[petty]

Lost a fair bit of money with Provenco (sold out for a big loss before it went broke) and learnt my lesson - so steered clear of the hype with Wynyard, GeoP, Orions etc - actually posted my earnings too on their threads.

What did I learn from Provenco?

Lumpy deals won with built in long tail service and maintenance (upgrade) contracts are a recipe for a company going broke, especially when the companies are tendering against established players.

That's the story with Provenco, Wynyard and I would venture to add, Plexure.

Would you put Ikegps in this bucket.?

[Balance]

Would you put Ikegps in this bucket.?

Have not had a look at them since it's a Forsyth Barr IPO.

Wynyard, CBL, Feltex, Credit Sails, SCF, Intueri etc etc - lesson learnt!

Enuf said.

[petty]

Lost a fair bit of money with Provenco (sold out for a big loss before it went broke) and learnt my lesson - so steered clear of the hype with Wynyard, GeoP, Orions etc - actually posted my warnings too on their threads.

What did I learn from Provenco?

Lumpy deals won with built in long tail service and maintenance (upgrade) contracts are a recipe for a company going broke, especially when the companies are tendering against established players.

That's the story with Provenco, Wynyard and I would venture to add, Plexure.

Share price is languishing and I’m looking at an entry. Got dealt to by Wynyard so learnt to tread more carefully with these type of share offerings.