Photon to make $5.5m loss following restrucure and sale of Geekversity
Photon, the marketing services group, is to make a $5.5m loss in its internet and e-commerce division following a restructure and the sale of its struggling business, Geekversity.
The internet marketing company Geekdom houses the consumer-facing division Geekversity which was launched to teach its clients how to make money in online marketing.
But Geekversity, which charges several thousand dollars per course, has now been offloaded to a yet-to-be named specialist provider of consumer training and education services.
Last week, it was reported that Geekdom is facing legal action from former customers seeking refunds from their payments totalling $18,000.
In a statement, Photon said: “The exit from Geekversity business as part of the restructure of the internet and e-commerce division is expected to result in non-recurring losses of approximately $5.5m in the first half of the financial year 2010.
“As a result the EBITDA for the internet and e-commerce division is expected to be significantly lower in the financial year 2010 than the prior period.”
Geekdom has made several job cuts this year. But its boss Troy Rushton told Mumbrella that it had not been making anymore redundancies as recently as last week, despite industry speculation.
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This was always going to end badly.
Note this comment in the ASX announcement about plans for the DBS portfolio
‘A number of companies across the internet division will work collectively on maximising the value of these assets in the medium term.’
When you cross to the dark side there’s usually no going back.
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I agree. And from a fundamental standpoint, Geekdom is 95% marketing, 5% product. Not a good idea in the coaching field.
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When writing this story for The Advertiser, three questions were not answered when the companies (Geekdom and Photon) refused my requests for interviews:
1. Will any staff be made redundant as a result of the sale?
2. Who purchased Geekversity?
3. Will Geekdom defend the consumer actions that are currently being lodged with fair trading agencies in separate states, or has the company sought to transfer all existing actions with the business?
I find it surprising that a listed communications company should be so focused on not answering questions about what it poses as a positive move.
(Disclaimer: a relative was involved in the Geekversity program).
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I too want to know Russell question.
as we all want to get our money back!!!
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Staff were made redundant as part of the sale.
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Russell, keen to talk to you. How can I contact you?
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Hi Holly,
My email is cremmerson@gmail.com or emmersonr@theadvertiser.com.au.
I look forward to talking with you.
Russell
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Have emailed you Russell. Thanks.
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Go Russ.
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