Crowdmix failure

Crowdmix

Music streaming and sharing platform

Description

Crowdmix was to be a music streaming and sharing platform on which people could listen and talk about their favorite bands. The company released a beta invite-only version of the app for DJ and musicians. The official app was never released.

Stats

Category
Music
Country
United Kingdom
Started
In 2013
Closed
By 2016
Number of Founders
Two
Name of Founders
Gareth Ingham, Ian Roberts
Number of Employees
Between 101 And 250
Number of Funding Rounds
1
Total Funding Amount
£14M
Number of Investors
No Data
Precise Cause of Failure
Mismanagement of Funds
Business Outcome
Acquired

Cause of Failure

Crowdmix extravagantly spent £14 millions of their investors’ money long before realizing a working product to the public.

The company spent lavishly on parties, flamboyant decorations for its offices and international travel for its staff. No one had a clear vision of the product, and founders kept adding features even before having a consolidated trial version. Moreover, Crowdmix lacked a clear  HR policy. This led to overstaffing and consequently contributing to the high running costs, with people being hired to ‘raise the company profile’ rather than because they actually provided a service for the company.

The founding CEO was reportedly forced to leave the company, which was left without any other investor willing to back it up and filed for bankruptcy.

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