Documented cause
Powa Technologies was founded in 2007 by Dan Wagner in London. Wagner was a serial entrepreneur whose previous company, Viant (a digital agency), had collapsed during the dot-com crash. Powa's products were PowaTag — a mobile commerce platform allowing consumers to purchase products by scanning QR codes on physical media — and PowaPOS, a cloud-based point-of-sale system. Wagner was a master of hyperbole and self-promotion. In December 2013, Wellington Management, the Boston-based asset manager, invested approximately $76M in Powa in a convertible note instrument. Wagner used the terms of the Wellington investment to claim a valuation of $2.7B, making Powa one of the first declared UK tech unicorns. The reality was starkly different. In 2015, Powa's revenues were approximately £2.3M. At $2.7B valuation, Powa was trading at over 1,200 times revenue. Wagner spent lavishly: Powa leased luxury offices on the Strand in London, and the company's spending on lifestyle and marketing vastly exceeded revenue. A further $175M credit facility was arranged in 2014 from a banking consortium. The PowaTag product had minimal real-world adoption; most merchants who had signed up were not generating meaningful transaction volumes. Wagner's claims about customer numbers and transaction volumes were disputed by former employees and journalists who investigated the company. In February 2016, Powa's creditors called in loans. On February 19, 2016, administrators from Deloitte were appointed. Wellington Management's $76M was lost. The banking consortium's credit facility was largely unrecovered. Dan Wagner had previously told the Wall Street Journal that Powa was "the most important company that has ever been built." The administrators found approximately 200 employees and almost no enterprise value.
Alternative account: Powa Technologies built PowaTag, a mobile commerce platform enabling consumers to scan QR codes or audio watermarks on any media to make instant purchases. Founded by serial entrepreneur Dan Wagner, the company raised $225M and claimed a $2.7B valuation, maintaining luxury offices in Canary Wharf, New York, and Hong Kong. In February 2016, despite claiming thousands of brand customers, the company went into administration with virtually no cash — the gap between claimed success and financial reality was total.