Scale Facilitation woes remain; John Brumby out of running for Scyne Advisory

Founder of Australian company, Scale Facilitation, David Collard in the One World Trade Center office. Picture: Abby Holden

More lofty promises out of David Collard and Scale Facilitation, the hobbled enterprise where executives are rushing for the exits and employees haven’t been paid in months.

With each day that passes another important, reputable member of the leadership team seems to leave the company. Nicholas Claydon, once a staffer to former resources minister Keith Pitt, is among the latest to depart, having been hired six months ago out of the Department of Industry as Scale’s director of strategic policy.

Scale Facilitation founder David Collard. Picture: Abby Holden

That’s to say nothing of the junior analysts no longer turning up for work after being left unpaid and having watched an Australian Federal Police raid on their Geelong headquarters last month where the fuzz spent hours looking for evidence of tax fraud.

Payments to employees and contractors for June were supposed to hit bank accounts over the weekend, but that didn’t happen, of course; some staff still haven’t been paid for the month of May, either, causing them to redraw on their home loans.

Collard, meanwhile, keeps oiling around his rented office in NYC trying to come up with fresh excuses to keep a mutiny at bay. The latest in this pitiful arabesque is that he’s apparently secured bridge financing of a few million dollars to actually pay people what they’re owed.

We’ll know soon enough if that’s true, and Margin Call understands the endgame is to pay out employees in Australia and then wind down the operations here.

That would mean Collard’s commitment to an electric battery “gigafactory” for Geelong – plugged repeatedly by the Fin Review – will have amounted to nothing. And that’s after Deputy Prime Minister Richard Marles and Industry Minister Ed Husic both visited the site and posed for photos that were plugged online as endorsements.

But at least Husic didn’t call Collard a “force of nature”, “innately entrepreneurial” and “values-driven”, as the DPM did in an awful error of Judgement in December, while attending a party at Scale’s offices in Manhattan. “He has the ability to see around corners and over the horizon,” Marles added.

Like the horoscope writer who failed to predict their own sacking, Collard’s vatic talents were needlessly overstated, even if they were just crowd-pleasing cliches uttered by one of the most important people in the Australian government.

And if Scale’s plan is to throw all remaining resources out of Australia at Collard’s vision for a British gigafactory instead, it would appear it, too, copped a blow in recent days, with the Times of London reporting that Collard’s point man in Britain, Peter Rolton, has also quit.

Barriers to entry

Scyne Advisory was on the verge of announcing John Brumby as its inaugural boardroom chair a fortnight ago, when Margin Call revealed the former Victorian premier was in late-stage negotiations with the firm’s private equity owner, Allegro, to lead the company.

Much was riding on the appointment. Brumby, of course, comes with impeccable credentials and ample board experience. There also remains a view within Allegro that, given the ignominious circumstances under which Scyne was born, it must be perceived as morally and ethically beyond reproach. “Whiter than white,” as one person put it.

Brumby undoubtedly fit that bill and there was much excitement afoot about his appointment. But Margin Call has learned of a devastating setback to these ambitions, causing Brumby to voluntarily withdraw from the gig in recent days – a conflict of interest with two companies that he’s already involved with.

Former Victoria premier John Brumby has voluntarily withdrawn from the running to be Scyne Advisory’s inaugural chair. Picture: Alan Barber

There’s no shortage of those. Brumby chairs the Melbourne Convention and Exhibition Centre, the Melbourne School of Government, Citywide Service Solutions, Biocurate – a pharma cook-up between Melbourne and Monash universities – and he’s the chancellor of La Trobe University (and there’s also his involvement with a few non-profits).

One might have suspected a perceivable conflict because of Brumby’s son-in-law, Patrick Lane, the recently-appointed director of media relations at PwC Australia; it’s difficult to bill Scyne as ruthlessly independent of PwC given the familial links. Alas, that wasn’t the issue.

Instead, it emerged during the final due diligence phase that PwC would be transferring its internal auditing services to Scyne, and that was an unfortunate development because Brumby happens to be involved with two companies that use those ­services and probably will for the foreseeable future. Too difficult a conflict to untangle, it meant Brumby had to walk away from the offer.

No response from Allegro or Brumby, but it’s understood that the search for a new chair continues. Former NSW premier Mike Baird and former Queensland premier Anna Bligh were both floated early in the piece, with Baird, the CEO of aged-care provider HammondCare and chair of Cricket Australia, already ruling himself out because he’s too busy to take the gig.