Bust up over £2bn dot-com disaster
Controversial tycoon clashes with furious US fund
BRITAIN’S biggest ever tech failure has triggered a bitter transatlantic row over what went wrong.
At its height, Powa Technologies was feted by former Prime Minister David cameron as a jewel in the nation’s computing crown.
it was a rare British unicorn – a tech business with a value of more than £2bn – but it collapsed into administration earlier this year amid claims of profligacy by chief executive Dan Wagner ( pictured) as it became clear the mobile commerce company’s rhetoric had exceeded its reality.
Now a spat has developed between Wagner and american investor Wellington Management over who is to blame for the company’s demise.
The former boss claims that Wellington – which ploughed £161m into the firm between 2013 and 2015 – sought to wrest the company away from him in an ill-judged power grab. Wagner, 53, claims that board member Ben White emailed Wellington to say investing any more money would be ‘a total waste of time’. Two days later, Wellington called in administrators
White and Wellington then reportedly took control of the firm’s flagship product PowaTag, which allows consumers to pay for goods using a mobile phone.
Wagner said the company was dealing with its issue up to the point that ‘Ben White and his coconspirators provided Wellington with an alternative option’.
Earlier this month, he alleged he had been targeted by enemies.
‘My outspoken and brash and controversial approach to running my business is not well-liked by the establishment,’ Wagner said.
Wellington disputed his version of events, and a spokesman said the fund was ‘at all times focused on serving the best interests of our clients in the face of what turned out to be a failed business model’. White also denied the claims.
Wagner previously ran a business called MaiD, later known as Dialog corp, which was sold after the dotcom crash when its shares plunged 95pc. it was at this firm the entrepreneur earned his unorthodox reputation, once wearing a Donald Duck waistcoat to a press conference. His flamboyant approach continued at Powa, which was launched to great fanfare in 2007.
Stories emerged of wild parties, Wagner drove a Bentley to work and in january this year he sent staff a bizarre email of himself dressed as David Bowie.
But despite paying staff more than £25m, the firm is alleged to have only had £4.8m in sales. Wagner claimed to have signed a chi- nese deal with ‘limitless’ potential, while 1,200 firms had given him their backing. it emerged these had signed letters of intent, not contracts – meaning they were not committed to anything.
one senior figure told the BBc that sales staff were handed a £2,000 bonus for every letter signed, ‘so they weren’t particularly concerned about the quality of the deal’. Powa entered administration in February.