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Pelican Exchange

Platform:
Crowdcube
Stage:
Seed
Industry:
Internet
Location:
UK - London
Date Rated:
28/09/17
Raise:
£750,000
Equity:
15.79%
Valuation (Pre Money):
£3,999,842
Industry: Internet
Location: UK - London
Platform: Crowdcube
£750,000 Seed
Valuation: £4,749,842
Date Rated: 26/09/17

MANAGEMENT

PRODUCT

INVESTMENT
Tax Status: EIS

Business Summary

Pelican Exchange is a social trading platform where users can trade thousands of global markets 24hrs a day and they can get real-time access to trades, ideas and knowledge by connecting them with other traders and mentors. Pelican makes money through trade commission and subscriptions. Pelican is FCA regulated and already has the Android & iOS Apps functioning. This round of investment will be used to fund further product development.

Financial Overview

Jan-22
Date (y/e) Jan-18 Jan-19 Jan-20 Jan-21 Jan-22
Sales Jan-18£79,603 Jan-19£772,741 Jan-20£2,881,205 Jan-21£5,582,368 Jan-22£9,631,399
Gross Profit Jan-18£40,936 Jan-19£685,970 Jan-20£2,090,332 Jan-21£3,923,002 Jan-22£6,758,340
GP as % sales Jan-1851% Jan-1989% Jan-2073% Jan-2170% Jan-2270%
Overheads Jan-18£647,015 Jan-19£743,035 Jan-20£783,824 Jan-21£846,684 Jan-22£880,733
Operating Profit Jan-18-£606,079 Jan-19-£57,065 Jan-20£1,306,508 Jan-21£3,076,318 Jan-22£5,877,607
OP as % sales Jan-18-761% Jan-19-7% Jan-2045% Jan-2155% Jan-2261%
Closing Cash Jan-18£190,364 Jan-19£42,079 Jan-20£914,846 Jan-21£3,112,537 £7,744,775

Note: This financial information has been sourced from the company on 26/09/2017. Financial data is NOT verified by Wheatfromchaff Ltd.
62%
SKILLS:
EXPERIENCE:
COMMITMENT:
The Founders have relevant managerial skills gained within the industry but they will need to strengthen the product development and the marketing functions to support the planned growth.
One of the Founders started a financial software business gaining significant industry knowledge and the right experience to set up Pelican with the help of experienced advisors.
The Founders are full-time and have invested £10k and significant time into the business. Both will be rewarded substantially if an exit can be achieved.
64%
MARKET:
PRODUCT:
COMPETITION:
The UK Spread Betting alone is worth £1bn but Pelican Exchange intends to address other verticals that are worth above £30bn in the medium term.
The Android and iOS are functioning but there are few supportive testimonials to date. However, new features and products are planned to improve the product's engagement and brand awareness.
The company is FCA regulated and has several features that should help the business be competitive if the main industry players don't add similar offerings in the short-term.
58%
PROFITABILITY:
CASHFLOW:
RETURNS:
The planned product extensions should support growth and the company currently has a low cost of acquisition, however, sales projections seem ambitious without a sustained marketing budget.
This round of investment provide enough working capital to achieve break-even but there is limited headroom in the forecast and revenue streams are not yet fully established.
If the company can deliver these profit margins and scale sales, it could become an attractive acquisition target and investors in this round could expect as much as a ten-fold return.


Conclusion

Pelican Exchange aims to build a world-leading platform connecting traders and given their lean business model and the low cost of acquisition combined with the mentoring program, strong traction could be easily achieved. That said a stronger team seems required to support further product development and achieve the planned level of growth.

Investors should note however that if the forecast growth is not achieved as planned further funds may be needed and given the nominee account, some investors could miss out as the Crowdcube nominee operates on a first-come, the first-served basis.

Related Links

Crowdcube Pitch

pelicantrading.io

 

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The Ratings we publish have been approved and issued at Financial Promotions in the United Kingdom by Wheatfromchaff in the United Kingdom who is Authorised and Regulated by the Financial Conduct Authority FRN: 751017. Wheatfromchaff Limited registered office is Kilver Court, Kilver Street, Shepton Mallet, Somerset, BA4 5NF and telephone number +44 (0) 1749 347 577. Telephone calls may be recorded. VAT No: 214 0196 49

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