giftet to the portfolio in 03/2019
It all started with an pitch at "Die Höhle der Löwen", Germanys version of "Shark Tank" in 2015. Unfortunately the full version and original Clip (Season 2 / Episode 3) is not even available behind the VOX stations paywall here.
The TV Show "Höhle der Löwen" is a German reality TV Show, where start-ups pitch their products and/or services to a jury of five entrepeneurs. After discussing and pitching the startup idea to the jury the judgement is out. If the entrepeneurs see fit, they can pitch an investment with the company and provide seed funding.
Von Floerke was founded by David Schirrmacher in Bonn. The original aim of the company was to (quote): "help men to develop more self-confidence, become more masculine and gain more classical elegance through high-quality accessoires like bow ties, dress handkerchiefs or socks". After starting a small online-shop in 2014 the founder could win three of the five "Lions" over to invest EUR 180.000 for a stake of 33% in his business.
At the beginning all looked "smooth and dandy". The show helped von Floerke to gain visibility. Sales increased and German shops like Zalando, Kaufhof and Otto started selling the products. Monthly revenue runrate 2016 was stated at EUR 400k. Investor Frank Thelen was an "very, very happy Investor" (01:21).
Soon afterwards first troubles began. German tabloid BILD-Zeitung reported that one of the investors Vural Öger would sell his stake in von Floerke. Schirrmacher gave an interview in which he bashed and bitched about Öger (link). „I am a little bit puzzled. first Vural Öger leaves our partnership with a good capital gain, then two of his companies go bankcrupt... A sneak preview of what was to come...
Meanwhile Frank Thelen kept his stake. When the Startup used the video above to collect EUR 1.2mn financing via Kapilendo things behind the scenes werent as smooth as they all pretendet them to be. Operationally things at the time seemed to be worse than the video suggested.(Link)
CEO Schirrmacher took the strategy to "think really big" and to bring back production from Asia to Germany. Therefore they aquired tie-maker Edsor Kronen. In part to integrate more of the value chain.
The other investors didn't like that move at all. Behind the scenes Frank Thelen tried to sell his stake to german entrepeneur Christian Heitmeyer, who founded brands4friends. (Link) This got Thelen a pretty extensive shit storm after rumors went out publicy.
At the same time Schirrmacher seemed to have started connecting with Christian Schoenberger an German entrepeneur who got into legal trouble selling alcohol online (Link). Even though the Von Floerke denied this loudly at the time. At some point Von Floerke started selling alcohol. Jack Daniels, Absolut Vodka, three bottles at a time at firesale prices... (link)
Things went downhill relatively fast.
An German "deal website", Mydealz published an deal on an friday afternoon and orders flooded in. Sunday evening already EUR 250k in sales had been done by one deal alone. Triggered by those extremely cheap deals on alcohol the company sold thousands of triple bottle packs. Paypal freezed the account in fear of an "exit scam", things blew up.. Few shipments were made, thousands of customers didnt got their paid bottles... shit really hit the fan ...
Frank Thelen tried to get out, got mad. (link) "That Von Floerke is selling cheap booze is not coordinated with me. If I could I would halt it." or "I would never selling cheap booze. I am interested in that as much as I am interested in cat litter shovels". He ordered a preliminary injunction, that his name shouldnt be used in marketing associated with Von Floerke anymore.
CEO Schirrmacher took Thelens behaviour as treason and switched gears dramatically. He started a public media warfare.
First Schirrmacher started giving discounts while still using Frank Thelen as a public face (without consent). (The code "HEULLEISE42" translates to "CRYQUIET42" with 42 as a reference to Thelens holding company being "e42".)
Then at some point Von Floerke started "Frank Thelen must leave Boxes".
10€ Box with an value of 30€. Let's surprise you and make a statement whether this man is truely von Floerke. We think no. He defames us, he lies about us. If you see it that way too: make a statement with buying the box.
(By the way: the Kapitalmarkthygienemuseum is very interested in getting its hands on one of those boxes!)
At the same time CEO Schirrmacher found that this kind of Guerilla Radio Marketing was after his liking. True the motto: "there is no bad press" he went all in.
One day, particularly stressed out he went on a live stream and ranted about everything. This feed got thousands of people and Schirrmacher calculated that this was quite effective use of social media / marketing.
Then mostly via Facebook Schirrmacher had regular live feeds in which he taunted, sweared, drank and showed off his gun collection he posessed as an avid hunter. "We shoot prices down" he yelled once. This eventually culminated to a (fake) SWAT-team visiting him at home, 6am in March 2019. (Link + Video). (Listen to the Podcast linked below for the full unbelievable story).
Unfortunately most of the videos with thousands of people commenting live are lost nowadays. One point in time Schirrmacher faked his escape from Germany - combined with another 30% of discount "Ehrenmann30".
That was the time when a good friend donated a pair of socks to the collection of Kapitalmarkthygienemuseum.
In preparation of this post I listened to a podcast and a 2h interview given in May 2019. I was utterly surprised by how sober, witty and reflected Schirrmacher comes across. I recommend listening to it - if one likes to get an full view "from the horses mouth" (Link: https://www.youtube.com/watch?v=qudlWuGeQq8)
But all the Guerilla tactics didnt work: Finally in October 2019 the company announced that they had to file for bankruptcy.
further links:
Links:
A German Book by David Schirrmacher: "Start up Märchen": Amazon
quite a read!
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