Aussie tech-media company collapses owing $12m after only making four sales in four years

An Aussie tech start-up that sensationally collapsed with debts of more than $12 million was losing money since its inception.

An Aussie tech start-up that sensationally collapsed with debts of more than $12 million was losing money since its inception, according to the liquidator’s report.

E-Mersion Media, based in Melbourne and with offices also in the UK, captured investors’ interest with its “innovative” idea of digitising traditional print magazines.

But the media-tech business only managed to make four sales in the four years it was in operation, coming in at a measly $84,274, the same report stated.

The company also received a further $200,000 from the government’s JobKeeper grant to pay staff during the Covid-19 pandemic.

And to date, that was all the income E-Mersion Media generated, from 2020 until it went into liquidation in April this year.

In that same period of time, it racked up losses of $12.6 million since 2020, according to the liquidator’s statutory report lodged with the corporate regulator, ASIC.

John Iliopoulos is the sole director of E-Mersion Media.

E-Mersion Media had attracted about $12 million of investment from 50 mum and dad investors, mostly from Australia, money they will be unlikely to ever recover.

The appointed liquidator, Mathew Gollant of restructuring firm CJG Advisory, noted in his report to the corporate regulator that E-Mersion also had an entity and offices in the UK.

Mr Gollant has made a claim against the UK E-Mersion entity for $1.48 million.

The company had managed to burn through $12 million by incurring “significant liabilities” including from staff wages, legal fees, computer and software expenses, and travelling.

News.com.au previously reported that the company had copped criticism from investors for spending more than $1 million over the course of three years, including business class airfares, luxury accommodation, fine dining, alcohol, spas and massages.

One of the more extravagant trips from consultants at the company involved them spending a year at a villa in Doha, the capital of Qatar, for $100,000.

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Investors critised the business for its travel expenses, including this standard villa at the hotel some consultants were put up in, in Doha.

E-Mersion Media says these were necessary expenses which ended up being over $100,000.

In the wake of the collapse, staff are owed $255,000 from unpaid employee entitlements, according to the report submitted to ASIC.

About $149,000 of that was from unpaid superannuation.

Only a few remaining staff were left at E-Mersion by the time of its demise because workers had quit en masse in June last year as their wages never arrived.

Some staff have still yet to receive their final wages after their resignation and are now eligible to be compensated under a government rescue scheme.

However, unfortunately, superannuation is not covered under the scheme.

Mr Gollant has been contacted for additional comment about his liquidation investigations.

E-Mersion Media’s sole director, John Iliopoulos, told news.com.au last year that the company was solvent and that all wages had been paid up to date.

He acknowledged the business had a revenue problem at the time.

“There are a lot of mistakes of why we’re not making revenue,” Mr Iliopoulos said. “Some things don’t work out to plan.”

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Originally published as Aussie tech-media company collapses owing $12m after only making four sales in four years