Quickflix capital raising falls $5m short as CEO asks customers to buy shares



Video streaming service Quickflix has  written a letter asking its customers to buy shares in a bid to raise $1m after a capital raising designed to bring in $5.7m raised just $650,000 from investors.

CEO Stephen Langsford has written to investors to ask them to buy shares at 0.003c each, telling customers they will use the cash for “working capital as well as in investment in content and marketing to achieve customer and revenue growth”.

Australia’s first video on demand service has struggled to gain traction in the market and is facing fierce competition next year with global giant Netflix, Nine and Fairfax’s Stan and Foxtel’s recent agreement with Seven around Presto to stream TV content all set to compete around content.

In today’s letter lodged to the ASX Langsford writes the company “has access to the largest potential streaming audience in the Australian and New Zealand markets” as it is available on most popular devices.

He adds: “Quickflix’s strategy is to grow customers through cost effective direct response channels and through partnerships with major brands and loyalty programmes representing large customer bases across a range of sectors including ISP, telco, retail and financial services.

“Quickflix will take advantage of the increase in awareness of the streaming category arising from the marketing efforts of major competitors and its existing presence in devices and other channels.”

Langsford added the company would also look to “take advantage of niche opportunities in the market which may be complementary rather than directly competitive to existing services.”

Yesterday the company’s share price dropped to a record-equalling low of 0.002c, giving it a market capitalisation of just $10.6m. At their peak in 2007 shares in the company traded for 28c, while as recently as mid-2012 they were worth 14c.

Alex Hayes


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