Dud note as music firm Roli faces cash crunch
The Sunday Telegraph17 Nov 2019By James Titcomb and James Cook
A BRITISH start-up whose hi-tech musical instruments are used by artists including Stevie Wonder, Grimes and the composer Hans Zimmer is facing a cash crunch as it struggles to repay millions in debt.
Roli, which has raised more than $130m (£101m) in debt and equity financing to develop innovative rubber keyboards and other electronic instruments, failed to repay $6.6m worth of loans to Silicon Valley investor Triplepoint this summer.
Last week, Triplepoint wrote down the value of its stake in Roli by 95pc and the value of its debt to 75 cents on the dollar. Triplepoint said it was working with Roli and other investors to return the company to profitability but said there had been a “meaningful reduction in value”.
Roli has been seen as one of London’s most innovative hardware companies and has attracted a string of high-profile investors including singer Pharrell Williams, Sony and Founders Fund, the tech investor started by Facebook backer Peter Thiel.
A Roli spokesman said that Triplepoint’s writedowns were a “common market practice within the high tech space related to the timing of corporate transactions, growth rates, and other factors”. The company’s latest accounts show that it made a £22m loss in 2017 on revenues of £10.4m.
Sajal Srivastava, Triplepoint’s chief investment officer, told investors that Roli had seen “delays in its fundraising activities as well as general performance below plan”.
The company has been renegotiating its debt and taking out short-term loans of three months or less in the process. Its products have been removed from Apple’s online UK store, although Roli says it is “in discussions with Apple”. Documents filed with Companies House show that Roli chief executive Roland Lamb’s stake has dropped below 25pc and three members of the board have stood down.
A company spokesman said that Roli “is turning its focus to profitability rather than growth” and is reorganising its senior management and board. The reduction of Mr Lamb’s stake was down to previous fundraising, he said. Earlier this year, Roli raised £1.6m from a crowdfunding campaign for its new light-up keyboard Lumi.
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Är klart mer attraherad av Osmose från Expressive E.