Update re. WeShop Limited

RNS Number : 9360S

Vela Technologies PLC

15 March 2019

 

15 March 2019 

Vela Technologies plc

("Vela" or "Vela Technologies" or the "Company")

Update re. WeShop Limited

The Board of Vela Technologies would like to update investors on its investment in WeShop Limited ("WeShop"), following receipt of a shareholder update.

Vela has an interest in 71,429 shares in WeShop which have a paper value equivalent to £427,145, based on the subscription price of the most recent funding round, as detailed in Vela's announcement on 1 October 2018. Vela's investment represents approximately 1.42 per cent. of the fully diluted share capital of WeShop. In its audited accounts for the year ended 31 March 2018, Vela valued its investment in WeShop at the acquisition cost of £100,000.

The shareholder update from WeShop is copied below:

WeShop Shareholder Update

March 2019

Introduction

WeShop is pleased to announce some significant developments in its ambition to unlock the true potential of social commerce, including:

1.   Significant product and proposition enhancements

2.   Strengthening the senior management team and the business's executional capability

3.   New branding with more relevancy and specific user group focus

4.   The agreement of key commercial deals as part of the plan to develop a true social retail ecosystem

WeShop has strengthened its user proposition by agreeing access to an online product inventory which:

§ Increases WeShop retailer count from 3,000 to 9,000+

§ Increases UK product count from circa 5m to 150m+

§ Access to a global product feed of circa 1.6bn products in 12 countries

§ Access to a global retailer count of over 20,000 merchants

§ Estimated UK coverage of 80% of all online products

WeShop has agreed a three year licensing agreement, with global exclusivity in Social Commerce. The deal makes WeShop the largest online retailer in the UK by product count. It gives consumers the fundamental choice of which merchant they buy a product from, and at what price point. This is a key milestone in delivering the best possible experience and proposition to our users.

WeShop has been working hard to ensure it can deliver the core elements of a best-in-class retail experience for consumers, across:

I.    Choice of products

II.   Best price

III.  Social recommendations

IV.  Strong AI and personalisation

V.   Mobile experience

VI.  Trusted supply of goods and delivery

By the end of H1 2019, WeShop will have fulfilled all these criteria, including exclusivity across points I and II, putting the company at the leading edge of Social Commerce. This ensures that the business is ready to begin user acquisition in Q2 2019, and drive engagement and transactions at scale.

1.   Significant product and proposition enhancements

WeShop will be deploying capability before the end of H1 that will deliver the largest online product inventory in the UK, enhancing our product coverage from 5m to 150m+ products, representing circa 80% of the UK online market. WeShop has signed a 3 year contract with a technology partner with full global exclusivity over social commerce. The technology is already live in 14 other jurisdictions with total product coverage at 1 billion+ products, and will support WeShop's possible future internationalisation plans.

2.   Strengthening the senior management team and the business's executional capability

As the business moves into this next crucial stage, WeShop is delighted to announce some strong additions to the senior team, tasked with executing and delivering our ambitious growth plans.

§ James Sowerby joins as Chief Executive Officer, from Avon Cosmetics, one of the world's largest social selling companies, where he headed up global business development, and previously Strategy. He brings with him deep experience in social selling, retailer partnerships, and executing global growth plans.

§ Paul Ellerbeck joins as Chief Technology Officer, with an excellent track record as a commercially-minded C.T.O in growth tech businesses including Easy Property Group, a disruptor in the online property market, and The Digital Property Group, one of the UK's largest property groups that merged with Zoopla.

§ Martin Best joins as Chief Marketing Officer, from World Remit, a major disruptive player in the money transfer market, having previously held various global Marketing and Commercial Director roles at Carlsberg. Martin has deep experience of practical execution of growth plans in disruptive industries.

§ Lisa Heidemanns joins as Chief Operating Office in Q2 2019, from LVMH where she has held a variety of senior management positions across the LVMH portfolio of brands, including most recently as Chief Client Officer of Rimowa. Lisa brings with her strong expertise in developing insight-led consumer propositions and experiences.

3.   New branding with more relevancy and focus

As part of WeShop's efforts to develop a compelling proposition and user experience, the proposition has been refocussed considerably on Gen-Z and Millennials (18-34 year olds), as they have the highest levels of engagement on social media, and penetration of online shopping, enabling the business to leverage existing behaviours. Considerable insight, testing and research has been carried out to ensure that the positioning, branding and messaging is as relevant and targeted as possible.

Gen-Z and Millennials:

§ Represent 59% of Facebook users, 64% of Instagram users, 51% of Pinterest users, whilst making up 43% of UK population

§ Are digital natives - they spend 15.4 hours a week on smartphones

§ Spend 7.6 hours a day socialising with family and friends

§ Over 50% of Gen-Z have left an online review in the past month

§ Care deeply about authenticity and transparency, the profiles of the brands they buy from, and about where they seek their inspiration, advice and recommendations.

4.   The agreement of key commercial deals as part of the plan to develop a true social retail ecosystem

Direct Integration: WeShop has completed its first commercial agreement with a retailer to directly integrate onto the WeShop platform, allowing users to checkout on site. The retailer provides over 100 top brand names in the world of fashion. Not only will this lead to a frictionless checkout experience, but the commercial rates agreed are 300% higher than the current average affiliate.

Brand Relationships: Over the past 3 months WeShop has developed several direct relationships with world leading brands and retailers, with signed Letters of Intent secured. These relationships will be progressed over the coming year with the ultimate view of directly integrating with their distribution centres. These will be formally announced to shareholders in the coming months.

Comments from Chief Executive Officer

James Sowerby, WeShop's CEO commented:

"Everything that we are doing is about positioning ourselves for long-term success: putting the strongest possible team and capability in place; being ultra-disciplined in the use of insight to enhance and refine our proposition; developing proprietary technology that is scalable and robust. We are readying ourselves to start user acquisition, in Q2 2019, and are genuinely excited to start scaling this business with conviction. I am very grateful for the continued support of our shareholders, and look forward to sharing updates on performance on a regular basis."

For further information, please contact:

Vela Technologies plc
Brent Fitzpatrick, Non-Executive Chairman Antony Laiker, Director	Tel: [phone]
Allenby Capital Limited (Nominated Adviser) Nick Athanas/Asha Chotai	Tel: [phone]
Smaller Company Capital Limited (Broker) Rupert Williams/Jeremy Woodgate	Tel: [phone]

About Vela Technologies

Vela Technologies (AIM: VELA), is an investing company focused on early stage and pre-IPO long term disruptive technology investments. There are currently 12 investments in the portfolio which either have developed ways of utilising technology or developing technology with a view to disrupting the businesses or sector in which they operate. More recently, Vela Technologies has also started to focus on existing listed companies where valuations may offer additional opportunities. 

 

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