The future of Blippar, once one of Britain's brightest tech startup hopes, is hanging in the balance this weekend as it battles to secure a £4m funding lifeline.
Fraught negotiations between investors in Blippar, the London-based augmented reality start-up, are set to continue into a third week, according to sources familiar with the situation.
Investors including property tycoon Nick Candy’s Candy Ventures, Qualcomm Ventures and Lansdowne Partners are attempting to resolve a dispute with Khazanah, a state-backed Malaysian investment firm that has blocked a crucial funding worth £4m.
One shareholder said on Friday they did not expect anything to happen “this side of the weekend”. Another source close to investors said things were “moving quickly”. A third source said they expected any deal to go “down to the wire”.
Khazanah’s preference shares grant the fund a veto over any new raise, to prevent their value being diluted.
Last week, sources close to Blippar said the company had “days not weeks” left if it did not raise more money. Administrators have been lined up if the company cannot raise funds, while there is speculation of a pre-pack administration sale to Mr Candy.
Founded in 2011, Blippar has raised $150m (£120m) from investors to fund its growth. The company’s app uses augmented reality technology, which imposes virtual images over the real world. The start-up runs an augmented reality brand advertising service, but has also invested heavily in artificial intelligence and computer vision technology.
Several former and current Blippar employees took to social media to defend the reputation of the company and its founders.
Danny Lopez, the company’s former operations head, said the start-up had been run by “passionate, innovative and decent” people, although “with the benefit of hindsight” things could have been done “differently”.
Several former insiders have privately raised questions about decisions made by the company, including heavy investment into artificial intelligence technology rather than its core augmented reality advertising business.
The start-up has burned through cash, losing around £37.5m in the year ending March 2017 for just £5m of revenue. In its last accounts, for 2017, it reported headcount of more than 260, although that number is now said to be around 75.
Blippar and Khazanah did not respond to multiple requests for comment. Candy Ventures declined to comment.