What ever happened to "the growing company that has become one of the most attractive technology companies in Israel," as the Shellanoo Group described itself on its website only 18 months ago? In 2016, the group planned an IPO on the Tel Aviv Stock Exchange (TASE) at a company value of NIS 600 million. No trace now remains of the company's history in Israel, the investments made in the company and its applications, or the illustrious gallery of investors it recruited. The name of Oded Kobo, the company's founder and former CEO, is also absent from the website.
Although the company's reports bore a going concern warning, Shellanoo Group, which formerly operated from luxurious and perk-filled offices in Herzliya, sought to raise NIS 95 million from the public in Tel Aviv at an especially generous company value. The offering was accompanied by an unusual campaign that included a huge billboard hung above the Ayalon Highway in Tel Aviv.
The company, led by Kobo and billionaire Roman Abramovich, boasted of a string of celebrity investors before its offering, including global entertainment figures such as David Guetta, Tiesto, Nicki Minaj, Avicii, former Abba member Benny Andersson, and will.i.am.
The local economic press, however, spotted a series of problems with the planned offering, giving rise to headlines stating that most of the applications had not yet been launched at the time of the offering, the company itself had no revenue and lost $15 million in the first half of 2016, and its most prominent application, Blindspot, was the subject of a legal proceeding.
These developments resulted in the cancelation of the offering a few days after the roadshow for it began, and Shellanoo Group began summoning employees for pre-layoff hearings immediately afterwards. Shortly afterwards, the "Huffington Post," a US website, reported that the company had managed to sell its two applications (one of which was Blindspot) for $32 million to a Chinese buyer, but there was no other confirmation of this deal. As of now, a look at the Blindspot website shows that the provocative application can be used, but only in China.
"The company has no activity in Israel"
Someone accessing the Shellanoo Group website now will read that it is "a holding entity and technology investment firm with a primary focus on Asia based companies and entrepreneurs, based in Hong Kong, with incubators in Beijing, Chengdu and Singapore… with a new 30,000 sq ft incubator in Singapore opening its doors in March 2018." The only mention of the company's history is that it was founded in 2014 "by industry leading investors and partners."
An e-mail from "Globes" asking why the website contained no information about the company's Israeli history or its current activity in Israel drew the following response from the company: "The Shellanoo Group closed its Israel branch and operation in mid-2016, shortly after being acquired. The Company has no operations or activity in Israel."
Asked when the group had been acquired and who its current owners were, the company responded, "Shellanoo Group parent Company Shellanoo Investment Group (SIG) invested $40 million in 2017 in the formation and construction of new technology incubators in Chengdu, Beijing and Singapore (opening March 2018). SIG is led by Amy Hong, Simon Chen, Peter Ma, Sam Andari and Robert Burrow." Up until a few days ago, the website stated that the company was led by Hong, but her name has since been removed from the website. Hong's LinkedIn account says that she has been the chairperson and CEO of the Shellanoo Group since January 2005 (even though the company website says that it was founded only in 2014).
One of the applications in which the Shellanoo Group invested, and which appeared in the prospectus submitted before the subsequently canceled IPO, was Music Messenger. This application sends musical messages free of charge and without advertisements that give users "unlimited access to music bases" and the creation of playlists. According to the figures in the prospectus, most users of the application are in the US, Mexico, and Brazil. The Music Messenger website lists all the information omitted from the Shellanoo Group website: the investors, including Abramovich, Minaj and will.i.am, and the company's basis in Israel.
Published by Globes [online], Israel Business News - www.globes-online.com - on January 1, 2018
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