At one time, Loot had all the appearances of a promising young Fintech. Launched in 2014, in January of this year, it was reported that the Royal Bank of Scotland (RBS) had taken a 25% stake in the startup as it prepared to launch a new digital bank. It has been reported the investment was around £5 million – not a small amount. The fact that old finance was investing in new delivered a solid stamp of validation and potential.
Earlier this month in writing about an upcoming crowdfunding round on Seedrs, Mark Bailie, a former COO at RBS and now CEO of stand-alone digital bank and banking platform by NatWest (RBS) – Bó, commented on Loot:
“Loot is a really exciting brand and one that we’re proud to be associated with. Through it’s innovative use of technology and intention to change the status quo, it’s quickly built a following of loyal customers, with potential for rapid future growth.”
Today, Loot is no more having announced the company is now in administration. The crowdfunding offering which had not yet exited a preview stage, was scrubbed from the pages of Seedrs. Apparently, RBS had a change of heart regarding the Fintech and had shunned Loot’s need for further capital.
Curious as to how events evolved surrounding the demise of Loot, Crowdfund Insider asked Seedrs for a comment. A company representative had this to say:
“It’s always a huge shame when startups don’t succeed on their mission, which in Loot’s case was to empower UK students and young people to have control over their finances.
As with many Seedrs campaigns, Loot’s round was predicated on the business securing a lead investor, however, when that fell through, it became apparent that Loot would not be able to secure the funds needed to pursue their growth plans.
During this time the company was in the first stage of our Seedrs Standard due diligence process and our investors and Loot customers were being provided with the opportunity to pre-register their interest. No open offer was live at that time.
We wish Ollie and the whole Loot team best of luck for the future.”
Perhaps the most curious aspect of the rise, and a rather rapid fall, of Loot was the fact that money raised in (or around) January may have vaporized? Did RBS renege on a commitment – is that the lead investor alluded to by Seedrs (most likely)? Was there something else going on that gave RBS cold feet? Did Bó think twice of any possible competition? We may never know… but Loot is now DOA.
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