Karhoo Technologies Ltd (09864120): administration
- Status
- Administration ended
- Administration began
- 2016-11-09
- Administrators
- Paul Steven Cooper, Paul Robert Appleton
- Administrators' firm
- BDO
- Incorporated
- 2015-11-09
- Location
- London
Why it went into administration
- Cash flow / liquidity pressure
- Funding withdrawn / unable to refinance
- Property / lease costs
- Management failings / irregularities
- Loss of key people
- Competition / price pressure
From the administrators' statement
Karhoo encountered a number of difficulties that proved to be msurmountable These difficulties included the misuse and incorrect accounting of promotional codes (often for rides of up to $40), which were given out indiscriminately Users would often use these codes for the most expensive trip possible and certain codes permitted customers to re-use on more than one occasion In October 2016, approximately 70% of Karhoo’s bookings were made using promotional codes Similarly, in an effort to retain users, Karhoo was generous with its refunds and other compensation for poor experiences
Karhoo also had problems with the fraud protection in its payment processing system, such as verifying a user’s address or requiring an email address to set up an account, leading to the rejection of many credit card payments (at one point, reportedly reaching a 90% rejection rate) Matters were not assisted by the continual changes in the technology teams over time, with a specific office finally set-up in Israel in the final few months of trading
Other issues that became apparent were customers complaining of overcharging and others advising of cabs not arriving on time This lead to poor reviews being left for the Karhoo app on the Google Play store with an average of 2 7 out of 5 rating compared to in excess of 4 for competitors apps
Administrators' statement of proposals (2017-01-13) · Companies House register