A wearable tech company has gone into administration after its backers decided not to invest any more money in the business.
Brothers David and Richard Gazal had already invested an estimated £2.4 million in Smartlifeinc, which trades as Smartlife, since becoming the main shareholders and directors of the company in July 2016.
Their original investment effectively saved the company from insolvency at the time but former CEO Martin Ashby said staff were left “shocked and devastated” after finding the passcode to their Manchester office had been changed at the end of March and administrators appointed in early April.
“Many of the employees had been shareholders so the decision to go into administration meant all their efforts over the years have gone unrewarded,” Ashby told BusinessCloud.
“We really felt this was the year when we would launch the technology and start to deliver a return to the investors. We’d planned to unveil it at CES in Las Vegas at the start of 2019 and launch a Kickstarter campaign but the investors decided against it.”
According to Companies House, Simon Jagger and Ben Woodthorpe, of London-based ReSolve Advisory, were appointed on 2nd April. They’ve not yet responded to BusinessCloud requests so it’s not known if Smartlifeinc has been bought out of administration and by whom.
The company was incorporated in 2010 with the aim of cracking the smart clothing market. Its team of scientists and engineers developed textile sensors in sportswear that could read biometric signals.
While most wearable tech can be bulky, Smartlife developed discreet sensors that could be integrated into garments with no wires or metal attachments. Acting as a conductor it picked up electrical impulses every time it touched the body and sent the useful information – like heart rate – to a smartphone app via Bluetooth.
Ashby, who joined the business in 2013 and became CEO in 2016, said he’d hoped the clothing tech firm could become “the beating heart of the next textile revolution” and was included in BusinessCloud’s North West Tech 251 list.
Smartlife was based in Princess Street, Manchester, and employed seven full-time staff and two more through a Knowledge Transfer Partnership with the University of Salford and University of Kent.
It’s not known why the administrators were called in but Ashby said the development of the product had taken longer than expected and the investors felt the quality wasn’t good enough to launch.
Ashby said: “The investors never discussed the administration with us. Smartlife had developed a number of potential commercial partners in the professional sport, sport and fitness, industrial and military sectors and we were confident that the launch product would have sold well.”
He said a disagreement with investors in December 2018 had seen a number of key employees leave the business but said news of the administration still came as a shock.
“The first we knew about it was when one of the staff couldn’t get in the office after lunch one day because the passcode to the doors had been changed and he had to call the investors to retrieve his stuff,” Ashby told BusinessCloud.
“We then received an email to say we’d been put into administration and put up for sale.
“I’ve not managed to speak to David or Richard Gazal despite several attempts so I don’t know if they’ve bought the business because I know other companies were interested.”
- Chris Maguire can be contacted at [email protected]