Entrepreneurs acquired £100,000 investment and Peter Jones’ support for Bluetooth business which helps to find misplaced items but the funding was later withdrawn because of “due diligence”
A Scottish tech start-up has lost out on a £100k Dragons’ Den deal and Peter Jones’ backing for its Bluetooth tracker after appearing on last night’s (Sunday, 8 January) BBC2 show.
Although Connect-In – which was founded by tech graduates Raj Sark and Vincenz Klemt, who developed the innovative ‘Xupo’ technology – struck a deal with the tech entrepreneur to share 30% equity in return for investment and support to help increase its marketing spend and market share, the funding was later withdrawn, according to Jones.
Last night, following the show, the Dragon tweeted: “My investment with My Lupo didn’t go through as some issues arose during due diligence. I still wish Raj all the best in the future.”
Xupo, which was originally known as Lupo at the time of pitching to the Dragons, is a coin-sized item locator which communicates with a smartphone app via a Bluetooth Smart™ sensor to find misplaced items.
The start-up has recently announced that Lupo has evolved to Xupo, now with up to 4x the range and improved features thanks to Bluetooth5.
The company forecasts £1 million in revenues for Xupo in the next year.
Sark said at the time: “We are thrilled about Peter Jones’ investment and his confidence in our product. We couldn’t have asked for a better Dragon, recognising the true value he will bring to our business based on his network and expertise as one of Britain’s leading technology entrepreneur investors.”
The idea was sparked when one of the founders lost their travel bag, including a new Macbook and passport, while connecting flights at Heathrow Airport.
Sark and Klemt say the experience prompted them to combine their engineering and business skills with practical thinking to design, develop and prototype a wireless tracking sensor. The device then launched as Lupo in 2014 after a successful £27,488 crowdfunding campaign with Kickstarter.
Since then, the growing Connect-In team has continued to innovate the product which has evolved into Xupo, a powerful Smart Location solution using Bluetooth 5 technology which offers users the ability to find items, ring their mobile and track items on a map.
Klemt had added: “Peter’s investment will help us further strengthen our position in the UK and expand into Germany and France, followed by Italy and Spain.
“Negotiating in the Den was an excellent and highly valuable experience. Being ‘grilled on the numbers’ is a classic challenge in the Den as much as it is with any investment pitch, and defending our proposition under a variety of constraints proved quite challenging.
“We knew that in the Den we would have to enter with a conservatively optimistic valuation, otherwise it would have been difficult. We had to ‘talk to the wall’ twice when negotiating with Peter, but in the end, settled for a great deal.”