Piers Linney's Outsourcery goes into administration - GCI buys business and assets

Piers Linney denied to Computing that 32 companies he has been involved with have failed

Former Dragons' Den star Piers Linney has seen his cloud services company Outsourcery fall into administration just three years after it floated on the Alternative Investment Market (AIM).

The Manchester-based cloud services company appointed Sam Woodward and Simon Edel of EY's restructuring team as joint administrators, with a deal for its business and its assets to be sold to GCI Network Solutions agreed today. Around 100 jobs will be saved as a result.

The administrators found that the company, which has offices in Manchester, Leicester and London, had invested heavily in its IT infrastructure in anticipation of strong revenue growth from its O-Cloud platform. However, that revenue growth proved to be well below expectations, resulting in trading losses and negative cash flow.

"The board was unable to secure additional working capital funding and, as such, commenced a marketing process to identify potential buyers for the business," said Woodward.

Vodafone had recently bailed out the company after it agreed a "conditional drawdown working capital facility" worth about £5m. That wasn't enough, but a buyer emerged in GCI to acquire the assets.

This isn't the first business that Linney has been involved in that has crashed and burned. According to some tabloid reports, the Dragons' Den star has been involved with as many as 32 companies that have subsequently folded.

However, when Linney spoke to Computing back in 2013 he vehemently denied the claims.

"Of the 32 companies which have been dissolved... only 11 companies ever really traded. [The report] used the word ‘folded', but only one of them folded owing money.... Others were never really owing a bean; I've never been owing anyone a bean. They've just used words to make up a story," he said at the time.

In the same interview, he defended the fact that Outsourcery wasn't able to raise the money it wanted before listing on AIM, and when asked about reports that he wanted to make the company a half-a-billion pound-worth company, he said he "aimed to make [Outsourcery] as big as [he] can".