A newly published report has shed light on the rescue of an augmented reality ‘treasure hunt’ app from administration this summer, revealing that its creditors are likely to miss out on hundreds of thousands of pounds.
The Snatch app was likened to ‘Pokémon Go for brands,’ utilising a player’s location paired with augmented reality (AR) to transform their immediate surroundings into an interactive playground. In the game, players travel around a real map to find parcels. If they can hold onto a parcel without it being stolen, it can be opened to claim real prizes from one of the app’s partners.
Founded by CEO Joe Martin, COO Jamal Hirani, and CMO Phil Lloyd, Snatch was backed by high-profile investors, including LastMinute.com founder Brent Hoberman, Silicon Valley Bank, and Unilever Ventures. The company closed a £4.4 million seed round in November 2017. However, after encountering cash flow problems, Snatch Media Limited appointed Colin Wilson and Joanne Rolls from Opus Restructuring as joint administrators on 3 July 2018, who secured a sale of the business and its assets in a job-rescuing deal.
A report to creditors has revealed that Snatch was sold to a London-based games publisher after administrators approached 38 existing investors and potentially interested parties. An offer was received on 21 June, and the sale was completed on 5 July, two days after the appointment of administrators. Harvey Elliott, founder and CEO of the purchasing company, stated that he was drawn to Snatch as it is a “really unique idea in a crowded marketplace.” Elliott highlighted the fact that the original team behind Snatch had engaged over a million people and secured hundreds of brands.
“The fact that they raised the level of investment they did is a testament to what a great idea it is. As a specialist games publisher, I believe we bring the skills and expertise to help the team realise its potential,” Elliott remarked. “Right now we can’t talk about our plans for relaunching the game, but there’s definitely a lot of work being done, and we’ll be sharing a lot more in due course.”
Snatch employed approximately 50 staff at its peak in February 2018, but the headcount was reduced to 30 due to various delays and fundraising issues. At the time of the sale, only 19 employees remained, all of whom were transferred to the buyer as part of the deal. The administrators’ report revealed that Snatch, which had raised $8 million in funding since inception, had approached the market to raise between $10 million and $15 million. The company had ambitions to expand to the US in 2019.
At the time of entering administration, Snatch owed £6.94 million to creditors, with the majority of debt owed to its US parent company. Meanwhile, HMRC was owed £318,603, and £325,825 was owed to trade creditors, who are only likely to recover £20,223.
The recent administration and subsequent sale of the Snatch app highlight significant financial losses for creditors, who are unlikely to recover the majority of the funds owed to them. The new ownership promises potential, but exact future plans remain undisclosed.