Australian music streaming service Guvera says it remains committed to its controversial $100 million float on the ASX, despite heavy criticism of the terms of the planned float.
A number of high-profile investors, including Atlassian co-founder Mike Cannon-Brookes, and the Australian Shareholders Association have criticised the business model of the Gold Coast-based company, which has put a potential value of more than $1 billion on its IPO, despite the company having made a string of heavy losses in recent years.
The float, if fully taken up, would see founder Claes Loberg score shares valued at up to $144 million, with another $98 million in shares going to CEO Darren Herft.
Guvera’s ex-chief commercial officer Michael Wallis-Brown has also joined the criticism parade. He told The Australian that the company in fact had “no tech, no users and no revenue.” He questioned Guvera’s claim that it has “more than 14 million registered users” in 10 countries.
“It takes 5 million users to download the app, and they use it once. And there’s 80-90 per cent attrition rate after that first usage – that’s industry standard,” he said.
In reply, Herft said he was not concerned by claims the business was misrepresenting its user numbers, declaring that his focus was instead on “future potential”.
