EYE reader tries to sleep with the enemy – but gets kicked out of bed

| Rosalind Renshaw

Come and sleep with the enemy: that was how online agent Russell Quirk, of eMoov, threw down the gauntlet to EYE readers, inviting high street agents to invest in his crowdfunding appeal for £1m – a pitch that values his business at £20m.

And that was exactly what reader PeeBee investigated doing (equipped, so he said, with teddy bear and comfy pillow).

On the CrowdCube website, PeeBee asked for help with understanding some of the mathematics – only to see his post removed, while Quirk himself responded to PeeBee, calling him an antagonist with a “mission to troll online estate agents”.

PeeBee, who is a high street agent in the north-east, said he is still looking for answers.

He has now posted up on EYE’s original story: “SO… along I goes – teddy and pillow at the ready for our sleep-in (although I did expect it to be more of a stay-awake, if being honest…) – chucks The Quirkster a few questions in relation to his proposition – and HEY PRESTO! my comment is immediately reported, removed ‘for moderation’ and responded to by the man himself – me being referred to as being ‘somewhat of an antagonist in the industry in your mission to troll online estate agents’ (still not sure whether that is an insult or a compliment…)

“Simple fact being – he dodged the questions I raised.

“I wonder why… and STILL want answers.”

By yesterday evening, eMoov had raised £685,010 from 148 investors. The company will give 5% of equity in return for £1m.

* Not one single online agent or other proptech firm was listed in the top 100 Tech Track list issued yesterday by the Sunday Times. The omissions from the list – which measures fast growth – were despite the fact that companies were not required to be in profit.

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33 Comments

  1. smile please
    September 7, 2015 at 07:49

    What were your questions PeeBee?

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  2. Gump
    September 7, 2015 at 09:11

    This has to be one of the worst investment opportunities ever, but a fool and their money I guess.

    There is no way he would/could answer the math question, anyone can fudge figures, I’ve been doing it for years 😛

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  3. PeeBee
    September 7, 2015 at 09:35

    Well… it sort of went like this:

    “Maybe you can help ME with my mathematical issues, Mr Quirk?  They appear to be very similar to those of others.

    First of all thank you for the open invitation on PropertyIndustryEye to ‘join’ you over here, ‘in bed’, so as to speak.  I have brought my favourite teddy and a comfy pillow but I doubt we will be getting much sleep.  I’m up for some rough and tumble.

    I hope that more colleagues in industry do exactly the same – Butt to be honest I Caan‘t imagine many of them will as we are all looking forward to the best selling day of the year which by the way hasn’t happened yet – how unfortunate that you clearly peaked too early in the race for sales and it’s all downhill for you now up to the next date you would like to pick out of thin air for another blatant shot at gaining extra column inches… ;o)

    Anyways – back to the Numbers Game.  And it IS a game – isn’t it?  Here’s the thing.  In your pitch you state that you have so far signed up 9000 PAID customers.  On your website – and everywhere else you can possibly quote it – you have been responsible for 4500 sales. 

    With me so far?  By my reckoning that leaves 4500 – yes?  Otherwise translates to 50% success to date.  LESS, of course, the numbers of available properties you have.  Which, according to Zoopla is 1082, and according to Rightmove is 1167 so let’s use the median – 1124 – and that reduces the balance at around 3376.

    Now 3376 as a percentage of 9000 is 37.5 – and it is THAT 37.5% of your register of 9000 units that is the issue here with me.  NOT with you, of course – you’ve already had their money and it’s included in your past income figures – but in terms of your claimed statistics it kinda bu99ers them up.

    Further up this debate thread you state “The typical high street agent sells 41% of its stock (according to the RICS). By way of example, in August our ratio of sales versus listings was 76%. In July it was 73% etc.”  You are not comparing apples with apples there and you know it.  You are not even comparing apples with elephants. 

    Basically, it could be reasonably assumed from MY figures above that you actually ‘sell’ [b]62.5%[/b] of the total number properties you list.  Is that correct? – if not I welcome the [b]actual[/b] figures from you and I will reassess accordingly.

    Of course all the above would not necessarily have been important before – you only took 100% payments up front – but now that you are offering a more ‘normal’ NSNF proposition that would mean that instead of achieving 83.33% of £595 (you don’t seem to mention anywhere that you are quoting VAT INCLUSIVE FEES on your proposition by the way…) on EVERY listing you [i]could[/i] only earn £1195 x  83.33% (removing the dreaded VAT element again) x 62.5% –  which you have to admit is quite a drop and it would be interesting to have clarification as to what percentage of future listings have been forecast at the ‘on sale’ fee model in future income predictions.

    But of course the average ‘investor’ won’t know that – they just see the figures you throw at them. 

    But I know a bit about the industry.  38 years of scars to show – and counting.  You want ME to invest in ‘the future’ as you see it? – then this is MY due diligence.

    I’ll no doubt have other questions in due course…”

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    1. smile please
      September 7, 2015 at 10:20

      And thats the problem with crowdfunding everyone!

      You can say what you like, answer to nobody as it is completely unregulated.

      As soon as questions or comments appear you do not like you can dismiss them as nobody else will hold you to your claims and promises.

       

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  4. Che
    September 7, 2015 at 11:05

    “You can say what you like, answer to nobody as it is completely unregulated”

    Hummmm, sounds familiar !

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    1. smile please
      September 7, 2015 at 12:44

      I take it thats a dig at estate agency???

      If so you are so far wide of the mark.

      Agents (traditional high street agents not onliners like emove) only get paid once the property is sold. We are also regulated by the OFT and Redress schemes if a customer has an issue. And can also be brought up on criminal charges if we break the law.

      Crowdfunding you can say whatever you like to raise money and what you will use it for. You do not have to prove anything regarding your figures and you also do not need to even spend the money on what you say you will.

      I can start a crowdfunding page today, value my company at 50 million (btw not worth even 10% according to my professional accountant) look to raise 5 million for a 10% share say i am going to invest the money in an aggressive office expansion nationwide.

      Let say i only raise £500,000 i can keep that money and give the retrospective shares. but if like emove means nothing as not turning a profit means i pay no dividends.

      I can then take that £500,000 and decide i do not want to go ahead with office expansions instead i feel like i should get an end of year bonus so pay it to myself.

      Investors will own their shares, will not get and dividends (most likely ever) and i will be £500,000 richer.

      As an investor i would be really upset to find out the company was never worth 50 mill and also upset my money was not spent what it was promised on. So i want to complain? to who? nobody! not even the FCA or the police!

      And you tell me crowdfunding is not a con ………

      Of course this in not the case with emove i am sure ……….

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      1. Che
        September 7, 2015 at 13:12

        Yep, sure is..!
        I’ve no first hand experience of Crowdfunding but am a seasoned business investor. Also I have owned and managed business’s regulated by the FSA (and the like) so I can take a balanced view between extreme regulation verses ‘voluntary’ regulation
        Crowdfunding seems like a concept that authorities will never regulate successfully and I guess rewards the funded. Its a gamble with the odds stacked against a decent return on the investment. As long as you know that at the start of the investment what your getting into and spread your bets across multiple investments then good luck !

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        1. smile please
          September 7, 2015 at 13:45

          Thanks for the reply but as i say your comparison is wide of the mark.

          As with the now defunct FSA replaced by the FCA you only have guidelines not rules. If a company starts up and wishes to stray from the guidelines they are punished as are estate agents.

          The problem i have with crowdfunding (as well as what i have written above) is that the returns are so minimal, I think emove is valued at 20 mill and is not turning a profit, it is not expected to turn a profit for another 3 years (we will see if that happens) how many houses do they need to list at circa £600 to make a profit? you are better off keeping the money in the bank with low interest rates or buying a property to rent!

          Too many of the crowdfunding ideas are not going to be profitable, which in part why they are crowdfunding as bank and angles/dragons do not see them as viable businesses.

          Emove in my opinion will only every make money if listed and even then i fear astute investors will avoid.

          As an experienced investor Che, would you know invest in emoves offering?

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          1. Che
            September 7, 2015 at 16:39

            I wouldn’t invest via CF but if the right deal was available, absolutely I would invest. Its a future model that stands a fair chance, in some form or other and in the long term of growing grow and be worth something. Change is coming and if you spread your bets you might be lucky and get one that cuts though.

            But sorry,  in terms of FSA FCA (or whatever its called now) regulation  V Estate Agency….no contest.

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            1. smile please
              September 7, 2015 at 16:48

              I think anybody would invest if the right deal is available and that’s the issue with crowdfunding, its not the right deal.Its dressed up to be but its not.

              Out of interest why do you think estate agency needs regulating? what do you think regulation can provide that we currently do not have?

              Its easy to say it makes an industry more compliant but in what? We already adhere to money laundering, already governed by the estate agents act, already have to be part of a redress scheme, already have to lodge deposits with a third party for lettings, need PI,  we can be brought up on criminal charges if we break a law, have data protection, need to abide by ASA.

              I fail to see what else regulation can enforce?

              You are not an agent, so maybe i am missing something, you have been kind enough to respond today maybe you would be kind enough once more?

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              1. Che
                September 7, 2015 at 17:38

                No problem. Regulation for me equates to governance and compliance, ergo the ability to act according to an order, set of rules or request.
                External audited rules that are imposed upon the organisation as a whole along with systems of control that achieve compliance designed to protect the interests of the customers to the maximum possible extent.

                For a million billion reasons this wont happen but the new breed of online agents, because of the use of technology do seem to be building in compliance behavior. Technology can deliver transparency which intern makes it difficult to hide info.

                Oh, btw, your right i’m not an estate agent but I do own one. Have done since 2007

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                1. smile please
                  September 7, 2015 at 18:07

                  Thanks for your reply.

                  I do not agree with it, but nice to hear reasons why.

                  I cannot see what regulation can bring to the party from what you have said above apart from maybe an audit (which i cant see improving anything).

                  You mention rules, what rules do you think need to be in place that are not already?

                  As for online agents being more transparent, how? All agents are online these days and we are all bound by the same rules.

                  Again not looking to pick holes but understand, I believe in the most part agents work to the rules and do not break them. Vendors and purchasers are safe and get a good service.

                  Third parties such as solicitors, lenders, mortgage advisers tend to create the delay which in my experience creates the buyers and sellers the greatest stress as they do not understand the process and then complain to the agent as they think they can magic a solution.

                  I would add the online agents offer a worse service as they are taking money upfront so no commitment to service. And have been seen to bend the truth comparing themselves with traditional high street agents when in fact the offering is less (albeit at a lesser fee).

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                  1. Chri Wood
                    September 7, 2015 at 19:07

                    So nice to see a polite, reasoned debate and exchange of views on here. Makes a lovely change 🙂

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  5. Woodentop
    September 7, 2015 at 11:08

    Crowd funding is a rich mans betting game. So rich, not that much bothered if they loose but Joe Public is a different matter. The only certain winner is the bookie and middlemen or in these cases those that that are at the top of the pile taking a fat salary from an investment that only JP can loose.

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  6. the message
    September 7, 2015 at 13:21

    Great post peebee, though I have to say that I love the fact that when any of us on here try and ask any OTM related questions we are shouted down.

    As a reminder, OTM has raised several millions on a business plan that many of us would like to know more about, but every time we ask are shot down in flames.

     

    Those of you that have “invested” have I believe been guaranteed a 10%-15% interest rate on your initial investment – which is “guaranteed”…..GUARANTEED BY WHOM?? have savills (maret cap about 3bn underwritten it?….) as if!

    You are now charging £300 per month to all users of the site. ANY SPECIAL DEALS AT ALL?.

    You have a board of directors who oversee the company to make sure management are acting properly, and in accordance with high level guidelines. WHICH OF THESE DIRECTORS HAS ANY EXPERIENCE OF DIGITAL MARKETING? How many of them work in the high end market?

    HOW MANY OF THEM REPRESENT THE SMALL INDEPENDENT

     

    As an investor, I am keen to know my money is being well spent. CAN I SEE A BUSINESS PLAN AND CASHFLOW?

    HOW MUCH IS BEING SPENT ON WAGES AND SALARIES EACH MONTH? WHAT PAY RISES WERE GIVEN TO PEOPLE WE POACHED FROM R AND Z?

    HOW MUCH IS IAIN SPRINGETT EARNING?

    As we cant have options given its a mutual, how are we getting quality tech staff?

    why is the office in central london at about £50 per square foot?

    You say that we now get 5.2m visits from over 2.5m uniques. So each visitor comes 2x a month more or less. Hitwise give a number about half of that. WHY IS HITWISE SO WRONG?, when for both r and z they are about 90% accurate?

     

    Assuming your numbers are correct, why are visitors only coming to the site 2x a month, when rightmove gets 100m visitors from 10m uniques – so 10 visits a month? are visitors not liking the site, or is the unique number wrong, as most independent observers believe?

    Who signed off on an initial TV marketing campaign, nationwide, at launch, when in most areas you had 15-20% of property that rightmove did? were we comfortable driving people to a site that wasnt ready?

    when did the countrylife deal get agreed? some of us heard about it back in february, but didnt believe you would have the backbone to see it through?. How much time effort and energy has gone into this, and what are the commercial terms?

    Are you hapyy that Rightmove has added over £1.5bn in value since the OTM launch? – it doesnt appear many people think you are hurting it – far from it?

    Do we have any targets that we can hold you accountable to?

    What consumer research was carried out pre launch? – are consumers happy that the list of features that are on rightmove and not on your site is better for them?

    It is easy to mock russell quirk and crowdfunding, and indeed I think it is as big a joke as the rest of you. But Peebee et al, would be great if you asked similar questions to OTM before blindly following the snake oil salesman and the group of high end agents who dont give a damn about the independent.

    Agents Mutual is a great idea ran into the ground by terrible execution and an arrogance of not listening to the (vast majority) of agents who havent joined. To us, you are even more gullible than those poor saps investing in Mr Quirk.

     

    end of

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    1. smile please
      September 7, 2015 at 13:52

      The Message.

      I dont really see the point of your post?

      The agents that have signed up are happy they did. The agents that did not like it did not.

      I fail to see why shouting them down helps anybody unless you either work for a rival or are not allowed to advertise?

      What would you suggest OTM do to improve their offering? easy to point fingers but you need a solution to be taken seriously.

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      1. the message
        September 7, 2015 at 14:20

        surely thats the same comments for those that have invested in emoov, but its fine for us all to laugh and mock at them? classic double standards!!

        Lots of suggestions to be honest. Target specific areas, dont try and be national from day one.

        Dont be a site “by agents for agents” – the worst strapline ever. This is a site that agents want to use for advertising, pure and simple, so become that. That means you need to take the best features that the global portals already have, dont revel at ignoring them.

        Find a way of incentivising away from big salaries, route to the poorhouse for any start up

        Get out of london, again why burn huge amounts of early stage cash on expensive rent when its not needed – prove to most of us its a national business not a london centric one

        Hire an independent chairman, business savvy, not in the pockets of the large london agents, and bring some diversity to the board table, plus some local agents.

        Ideally cut back the cost, you are only worth about £50 a month at the moment, you have to show a way of doing things cheaper than you are

        Ideally lose the exclusivity, dont penalise my existing business for me wanting this to work.

        Hire some digital superstars, not just people who are mates with springett or who used to work at primelocation(not exactly the a team as IS called them)

        stop being so arrogant, accept you have a long slog ahead, stop putting out cringing press releases or being rent a quote, get staff to knuckle down to the hard yarrds now needed, get rid of those who are taking you for a ride (every company has them, especially start ups offering big salaries).

        Turn off the countrylife deal (it stinks to high heaven)

        That do for now?

         

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        1. Woodentop
          September 7, 2015 at 14:28

          Do not your comments also apply to RM, Z or any other portal? What about the founder members shares robbed by RM for instance and the fee they charge is twice and more than that of OTM. Smile Please has a point.

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        2. smile please
          September 7, 2015 at 14:56

          I dont think its double standards at emove as they have manipulated the truth to say they are something they are not. And unfortunately i think a lot of people will lose a lot of money.

          You have some valid points but the manner in which they come across its almost like you want OTM to fail?

          I am not a member, but do want it to work, i dont run them down but try and engage with others (although many do not listen) to help shape it for the better.

          If more pro and anti agents talked to address the issues it could become something great but the whole time people shout “Just Join” or others just pick fault we end up at an impasse.

          if you truly care about our industry, and truly like the idea of OTM why not express your thoughts and get others on board to change it so it works for you. All you are doing at the moment is alienating yourself and driving a wedge ……. maybe this is what you want?

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          1. the message
            September 7, 2015 at 15:26

            i definitely want to alienate myself…:)

             

            I think I made some fair points above, tried to be sensible, and have talked many times of being an AM fan. But as time goes on I get more irate about the OTM method, the bullyboy tactics, the arrogance of things like countrylife, and the fact that most of us when we say anything are accused of being blacklegs, or strike breakers, or even worse fans or employees of z or r.

            My style might end up a bit abrupt, and online is never the best vehicle, but I have been asking those questions laid out above to OTM reps,other agents and on here, and noone can answer them, apart from “trust us”…..trust us…savills, douglas and gordon, marsh and parsons…knight frank….trust us to look after you the small guy………….we share your pain……now tootle away like a good chap whilst we do a deal with country life and the evening standard and the telegraph theres a good little serf.

             

            We are all in this together, sadly most are working in the kitchens serving lord and lady grantham

             

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            1. smile please
              September 7, 2015 at 15:55

              If you could just change one thing that would get you close to signing up, what would that be?

              As i said i think you have some valid points but in all honesty you will not get IS to change his wages, you will not get the digital team changed and you will not get them to change their address.

              If OTM reps / powers that be identified ONE or two major objections to agents joining then they can work to rectify it. if people are just moaning and picking holes then not much they can do.

              For me i want to see a focused, targeted date to walk away from RM for me that shows a plan and if agents local to me get behind it (the majority) i am happy to work with them to achieve this, the countrylife and alike is a battle for another day.

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    2. PeeBee
      September 7, 2015 at 14:22

      ‘the message’

      I’m not in the least annoyed that you have semi-hijacked the thread – done it myself on many occasions.  That being said – there is a perfectly good OTM thread running today on which you have posted, yet your post there covers none of the above.  Why is that?

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  7. the message
    September 7, 2015 at 14:49

    RM fee is for what they deliver. OTM fee is mostly investment, and you are an owner, hence ideally we would need to invest less as they ran their business more efficiently. OTM cannot justify £300 based on what they bring to the table for marketing – thats fine, the people investing know the score, but me, and many others, feel it could be run a heck of a lot better.

    sorry peebee, opportunity was just too good to miss with the amount of condecension shown to crowdfunding saps, by those very people who had invested into OTM without asking any questions either!

     

    sorry…….big smile of embarrasment – I will go in the corner.

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    1. PeeBee
      September 7, 2015 at 15:59

      “RM fee is for what they deliver.”  IS it?  Is it not simply because competitors ‘A’, ‘B’, ‘C’ and ‘Z’ are all on there; have spent the last dozen or so years telling everyone that if their property “isn’t seen on RM then it won’t get seen at all” and because coming off could cost them instructions to those competitors?

      Be fair, ‘the message’.  Numptyfunders chuck a few quid at EVERYTHING on the basis that enough of them will produce a return to come out on tops.  The vast majority don’t give a fuppeny tuck about who the firm is they ‘invest’ in or what they do as long as the pitch looks attractive – and this was my whole point.

      You have to acknowledge that AM was and is something completely different.  I’m not saying that it’s perfect by any measure of the word and would agree with you that certain things could be done differently – but those that chose to invest in it are certainly not leaving it to sink or swim on its own in the way that the numptyfunders will chuck a few quid at it and every other pitch – SIX individuals today ‘invested’ a cumulative total of less than five hundred quid… says it all, really.

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      1. smile please
        September 7, 2015 at 16:34

        PeeBee, I have got to say you grasp the OTM thing much more realistically then any of the other members that voice their opinion here.

        We hear a lot of why agents have not signed up, you have. In your opinion what should OTM do to increase membership? Do you think there is light at the end of the tunnel to walk away from RM? – Not a loaded question (a complement if you will) just be nice to get an opinion of a member not completely blinded by being OTM

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        1. PeeBee
          September 7, 2015 at 21:40

          Hi smile please

          Rather than answer here, as I sincerely believe for all the right reasons  that this thread is the wrong place, may I just ask you to read what I posted about two thirds of the way down the comments on this thread –

          http://www.propertyindustryeye.com/onthemarket-chases-its-next-big-milestone/

          – and let’s make a date to discuss it on the next relevant article thread?

          (of course you could ask Ros for my email address – not only would I love the opportunity to ‘talk’ to you, but I WILL get you that appointment you have been waiting for with someone from OTM!)

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          1. smile please
            September 8, 2015 at 15:11

            Its a nice comment PeeBee with a balanced view.

            BUT i would still like to hear what YOU think OTM should do to increase membership and if it is possible to walk away in the future from RM – I understand the “MAY” comment but leaving that aside what are your thoughts?

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            1. PeeBee
              September 8, 2015 at 22:21

              OKAY… I guess you win!

              But not here – let’s take this where it belongs – to the ‘OTM toppling Z’ story!

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  8. Woodentop
    September 7, 2015 at 17:09

    It strikes me that the concept and need for OTM is either not understood, been forgotten or don’t want to know. Some of the anti OTM objections fail as they also apply to any web site or people have other business interest invested in making it not work. All I am hearing is personal agenda towards an individual(s). Nothing constructive. Bottom line is the public don’t see or care about agents squabbling, all they want is to see properties. Who they go to is fundamentally down to the agent. If you are on RM that is where you direct them and the same applies to any other portal. I don’t hear anyone so anti OTM complaining about the other portals unless it’s Z but all sites basically do the same. The arguing recently is more about traffic flow, most is presented as a sales pitch and like all stats often manipulated. If I was to add up all the unique visits RM & Z say they get each month, during the year its more than the people living in the UK!

    And this thread is supposed to be about eMoov!

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    1. PeeBee
      September 9, 2015 at 14:08

      IT IS, Woodentop – but that doesn’t stop a bit of playful banter! ;o)

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  9. PeeBee
    September 9, 2015 at 14:07

    It seems that despite my asking Crowdcube to confirm how long the ‘moderation’ process takes I’ve had no feedback.

    I reckon they’ve simply overlooked the fact that there was nothing whatsoever ‘wrong’ with the post and have therefore overlooked the need to reinstate it.

    SO… I’ve done it for them!

    How kind am I? ;o)

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    1. PeeBee
      September 9, 2015 at 15:48

      Oh, dear – it’s disappeared.

      AGAIN.

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      1. PeeBee
        September 9, 2015 at 16:06

        OH LOOK – the original post has been reinstated like it never happened!  No explanation – nothing.

        I wonder if it will get a more relevant response from The Quirkster than the original, in which he stated

        “I’ve often indulged in sparring with you on twitter and the trade property forums…  However you will have to forgive me for not taking the bait in this instance.”

        Looks like I’ll be keeping my tenner, then…

        Report
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