We review Cafelavista’s coffee machine investment paying 15% per year

Cafelavista logo

Cafelavista offers returns of 15% per year to investors who invest in its coffee machines.

Investors buy coffee machines for £3,000 each (+ £600 VAT if they are not VAT registered) and then rent back their machine to Cafelavista, which promises to pay a total of £5,700 per machine back to them (in rental income, an annual “ingredient bonus” and a final “balloon payment”) over a six year term, after which Cafelavista promises to take the vending machine back.

This gives an average return of 15% per year, or 9.7% if the investor has to pay £600 VAT on top of their initial purchase.

Who are Cafelavista?

Cafelavista owner Antony SpearCafelavista Limited is run by founder Antony Spear.

Prior to setting up the Cafelavista investment scheme, Spear ran a tiny website design firm which appears to have stopped work in June 2018, judging by its Facebook page. (Its last project was for The Tasty Plaice Fish & Chip Shop in Bridgend Industrial Estate.) According to Spear’s LinkedIn profile, prior that he ran “Spear Business Consulting” from 2004 to 2016. Spear Business Consulting has left no trace on the Internet that I could see.

Cafelavista Limited’s last accounts for February 2020 show little information other than £77k of net assets. The entity of most interest as far as the investment scheme is concerned is Vista Rental Limited, as this is the company which commits to pay returns to investors. However, Vista Rental extended its first accounting period to February 2021 last month, meaning it will not be due to file accounts until June 2021.

How safe is the investment?

Cafe La Vista claims to provide a “LOW RISK – HIGH REWARD” investment. In a YouTube advert it states

In the stock market, the bigger the risks, the higher the rewards. With CAFELAVISTA, there are high rewards to be gained but a low risk investment.

This is misleading to the point of total claptrap. Fundamentally investors are not investing in a vending machine but in Cafelavista’s promise to pay them 15% per year. An unregulated investment in an obscure small company is not in any sense “low risk”.

Cafelavista claims its investment is “100% asset backed” and offers “guaranteed buy back”.

The guarantee to buy investors’ machines back is dependent on Cafelavista having the money to do so. Otherwise investors will be trying to sell used vending machines on the open market. In which case, given that they aren’t going to be offering a 15% per year return, they should expect a significant loss.

Should Cafelavista fail to make enough money to pay investors 15% per year on top of their own costs, the worst case scenario, bearing in mind that Cafelavista holds the vending machine, is that Cafelavista cannot even return the vending machine and the investor loses up to 100% of their money.

If investors plan to rely on the claim that Cafelavista is “100% asset backed”, it is essential that they hire professional due diligence specialists (working for themselves, not Cafelavista) to confirm that in the event of a default, the assets of Cafelavista would be valuable and liquid enough to compensate all investors. Investors should not simply rely on what Cafelavista tells them about their assets.

Regulatory issues

Cafelavista Instagram advertCafelavista solicits investment directly from investors via Facebook and Instagram adverts.

Issuing financial promotions in the UK requires authorisation from the Financial Conduct Authority. Cafelavista is not authorised by the FCA and there is no indication on Cafelavista’s adverts that the promotions have been signed off by an FCA-regulated firm.

If Cafelavista are pooling investors’ money to pay their 15% per year, this would constitute a collective investment scheme under UK law, which also requires authorisation from the FCA.

Running unauthorised collective investment schemes and issuing financial promotions to the public without FCA authorisation are both criminal offences.

Should I invest with Cafelavista?

This blog does not give financial advice. The following are statements of publicly available facts or widely accepted investment principles, not a personalised recommendation. Investors should consult a regulated independent financial adviser if they are in any doubt.

As with any investment in a tiny unlisted company, this investment is only suitable for sophisticated and/or high net worth investors who have a substantial existing portfolio and are prepared to risk 100% loss of their money.

Any investment offering returns of 15% per year should be considered extremely risk (despite Cafelavista’s nonsensical claim that investing in coffee machines isn’t subject to the universal rule that high returns = high risk).

As an investment in an individual micro-cap company with a risk of total and permanent loss, Cafelavista is much higher risk than a mainstream diversified stockmarket fund.

Before investing investors should ask themselves:

  • How would I feel if the investment defaulted, Cafelavista did not have the money to back its “guarantees”, and I lost 100% of my money?
  • Do I have a sufficiently large portfolio that the loss of 100% of my investment would not damage my lifestyle?

If you are looking for a “low risk” or “guaranteed” investment, you should not invest in unregulated investment schemes with a risk of 100% loss.

6 thoughts on “We review Cafelavista’s coffee machine investment paying 15% per year

  1. If I read this correctly the plan is as follows
    I shell out £3,600 per machine as an initial outlay hoping to get £ 5,700 back in total in 6 years time
    Assuming that the company remains solvent during the period

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  2. It begs the question if it’s such a guaranteed winner why doesn’t the company just put £3000 machines in without involving outside investors and the need to pay them £5700 out of the profits. Are they really so broke they have to offer such amazing terms to get somebody else to buy the machines for them?

    Like

  3. Please find Cafelavista’s official response to this post.

    Bond Review
    Cafelavista offers returns of 15% per year to investors who invest in its coffee machines.

    Investors buy coffee machines for £3,000 each (+ £600 VAT if they are not VAT registered) and then rent back their machine to Cafelavista, which promises to pay a total of £5,700 per machine back to them (in rental income, an annual “ingredient bonus” and a final “balloon payment”) over a six year term, after which Cafelavista promises to take the vending machine back.

    This gives an average return of 15% per year, or 9.7% if the investor has to pay £600 VAT on top of their initial purchase.

    CAFELAVISTA OFFICIAL RESPONSE:
    Cafelavista Limited supply and sell branded commercial coffee machines to individuals and business wishing to place their coffee machines into retail and business establishments for commercial rental gain. We also supply high quality branded coffee beans that are hand roasted to deliver the exacting taste and flavour our customer’s demand. These ingredients are used exclusively in our commercial coffee machines.

    For the avoidance of doubt, Cafelavista supply and sell commercial coffee machines and ingredients under its own branding.

    Bond Review
    Who are Cafelavista?
    Cafelavista Limited is run by founder Antony Spear. Prior to setting up the Cafelavista investment scheme, Spear ran a tiny website design firm which appears to have stopped work in June 2018, judging by its Facebook page. (Its last project was for The Tasty Plaice Fish & Chip Shop in Bridgend Industrial Estate.) According to Spear’s LinkedIn profile, prior that he ran “Spear Business Consulting” from 2004 to 2016. Spear Business Consulting has left no trace on the Internet that I could see.

    CAFELAVISTA OFFICIAL RESPONSE:
    Antony Spear is a director of a web design business that was set up for and is run solely by his son. More importantly, Since Spear Business Group, Antony consulted with many new business start-ups and mid-size companies providing business mentoring services before setting up Cafelavista Limited.

    Bond Review
    Cafelavista Limited’s last accounts for February 2020 show little information other than £77k of net assets. The entity of most interest as far as the investment scheme is concerned is Vista Rental Limited, as this is the company which commits to pay returns to investors. However, Vista Rental extended its first accounting period to February 2021 last month, meaning it will not be due to file accounts until June 2021.

    CAFELAVISTA OFFICIAL RESPONSE:
    Cafelavista’s annual accounts confirmed sales of more than £600,000 with an excellent trading profit and good net assets. We believe this is a great success for a newly established business operating in the drinks to go marketplace.

    Cafelavista extended its accounting period in the first year of trading as we were advised to do so by accountancy professionals. Tens of thousands of new businesses each year take up this option and is fully compliant with Companies House rules and regulations. In the same way, Vista Rental Limited has also been advised to extend its accounting period.

    Bond Review
    How safe is the investment?
    Cafe La Vista claims to provide a “LOW RISK – HIGH REWARD” investment. In a YouTube advert it states
    In the stock market, the bigger the risks, the higher the rewards. With CAFELAVISTA, there are high rewards to be gained but a low risk investment.

    This is misleading to the point of total claptrap. Fundamentally investors are not investing in a vending machine but in Cafelavista’s promise to pay them 15% per year. An unregulated investment in an obscure small company is not in any sense “low risk”.
    Cafelavista claims its investment is “100% asset backed” and offers “guaranteed buy back”.

    CAFELAVISTA OFFICIAL RESPONSE:
    Cafelavista are NOT involved with investments as previously stated. Our customers purchase branded commercial coffee machines from Cafelavista which they own! Our offer is 100% transparent and cannot be clearer.

    Bond Review
    The guarantee to buy investors’ machines back is dependent on Cafelavista having the money to do so. Otherwise investors will be trying to sell used vending machines on the open market. In which case, given that they aren’t going to be offering a 15% per year return, they should expect a significant loss.

    CAFELAVISTA OFFICIAL RESPONSE:
    Firstly, Cafelavista do not buy the machines back Vista Rental Limited do. Machine owners have a separate agreement with Vista Rental Limited, our sister company who specialises in renting commercial coffee machines to retail and business customers.

    In partnering with Vista Rental Limited, machines are rented to retail and business customers on commercial rates. In return, Vista Rental agree to pay machine owners a fixed monthly amount for each machine they own for a fixed period. Furthermore, Vista Rental also pay an ingredients bonus to machine owners based on the amount of ingredients used in their machines. This is paid at the end of each year of the agreement.

    Vista Rental Limited may also offer to buy-back the machines at the end of the agreement, subject to contract, for a fixed fee. There is a large secondary marketplace for commercial coffee machines from the sub-prime or charity marketplaces and the sale of the machines to these sectors significantly exceed the buyback fee.

    We also provide each owner access to a management portal where comprehensive ownership details are stored of each machine they own, together with financial information including upcoming payments. Everything is 100% transparent.

    Bond Review
    Should Cafelavista fail to make enough money to pay investors 15% per year on top of their own costs, the worst case scenario, bearing in mind that Cafelavista holds the vending machine, is that Cafelavista cannot even return the vending machine and the investor loses up to 100% of their money.

    CAFELAVISTA OFFICIAL RESPONSE:
    Vista Rental Limited place the commercial coffee machines out with rental customers. Each month payment is made to machine owners under the agreement. To be clear, Cafelavista nor Vista Rental own the machines. Every conceivable step has been taken and considered that, should any event or situation suggest a worst case scenario, the assets can be returned to the rightful owners and alternative arrangements can be made to place them out on commercial rent with another company.

    Bond Review
    If investors plan to rely on the claim that Cafelavista is “100% asset backed”, it is essential that they hire professional due diligence specialists (working for themselves, not Cafelavista) to confirm that in the event of a default, the assets of Cafelavista would be valuable and liquid enough to compensate all investors. Investors should not simply rely on what Cafelavista tells them about their assets.

    CAFELAVISTA OFFICIAL RESPONSE:
    We ask every individual or business interested in joining Cafelavista Limited or Vista Rental Limited to seek financial advice from a suitably qualified professional. This business if structured correctly can qualify for capital allowances and may also qualify for business property relief (IHT). Furthermore, all VAT can also be reclaimed so to maximise the benefits which may be available, we recommend speaking with professional advisers as everyone’s circumstanced vary.

    Bond Review
    Cafelavista solicits investment directly from investors via Facebook and Instagram adverts.

    Issuing financial promotions in the UK requires authorisation from the Financial Conduct Authority. Cafelavista is not authorised by the FCA and there is no indication on Cafelavista’s adverts that the promotions have been signed off by an FCA-regulated firm.

    CAFELAVISTA OFFICIAL RESPONSE:
    Cafelavista Limited advertises on multiple platforms including Facebook as does Vista Rental Limited and millions of other businesses. We do NOT advertise investment opportunities and our adverts do not require approval by a Financial Conduct Authority regulated firm to sell commercial coffee machines or to rent commercial coffee machines on behalf of machine owners.

    Cafelavista is promoted as a fully managed coffee rental franchise that has pioneered a game-changing business model that operates in the hot & cold drinks 2Go unattended retailing (vending) marketplace. Over 100 franchisees have joined our successful, debt-free company in the first 18 months of operation and both our business and franchisees have thrived even during these challenging times. Vista Rental Limited continues to make 100% of payments due to franchisees on time, every time.

    Bond Review
    If Cafelavista are pooling investors’ money to pay their 15% per year, this would constitute a collective investment scheme under UK law, which also requires authorisation from the FCA.
    Running unauthorised collective investment schemes and issuing financial promotions to the public without FCA authorisation are both criminal offences.

    CAFELAVISTA OFFICIAL RESPONSE:
    This is NOT a pooled investment. Cafelavista Limited supply and sell commercial coffee machines and ingredients. Vista Rental Limited rent commercial coffee machines to retail and business customers.

    Our business operates in a transparent and 100% legally compliant format.

    Bond Review
    Should I invest with Cafelavista?
    This blog does not give financial advice. The following are statements of publicly available facts or widely accepted investment principles, not a personalised recommendation. Investors should consult a regulated independent financial adviser if they are in any doubt.
    As with any investment in a tiny unlisted company, this investment is only suitable for sophisticated and/or high net worth investors who have a substantial existing portfolio and are prepared to risk 100% loss of their money.
    Any investment offering returns of 15% per year should be considered extremely risk (despite Cafelavista’s nonsensical claim that investing in coffee machines isn’t subject to the universal rule that high returns = high risk).
    As an investment in an individual micro-cap company with a risk of total and permanent loss, Cafelavista is much higher risk than a mainstream diversified stockmarket fund.
    Before investing investors should ask themselves:
    • How would I feel if the investment defaulted, Cafelavista did not have the money to back its “guarantees”, and I lost 100% of my money?
    • Do I have a sufficiently large portfolio that the loss of 100% of my investment would not damage my lifestyle?
    If you are looking for a “low risk” or “guaranteed” investment, you should not invest in unregulated investment schemes with a risk of 100% loss.

    CAFELAVISTA OFFICIAL RESPONSE:
    Cafelavista Limited like most businesses operating in our industry express the income generated from their business model as a Return on Investment (ROI), when comparing the initial cost of buying a commercial coffee machine and the payments they receive when that machine is rented. This figure also includes the ingredients bonus and the machine buy back. This can also be expressed as operational profit, and both are clearly stated on our website, marketing, and prospectus.

    Cafelavista continue to build a successful company and brand as can be seen by our Trustpilot reviews.

    For further information contact Cafelavista Head Office.

    Like

  4. Cafelavista are NOT involved with investments as previously stated.

    I hand Cafelavista £3,600 or a multiple of the same, and they promise to pay me £5,700 over a six year term. That’s an investment.

    Our offer is 100% transparent and cannot be clearer.

    Anyone offering an unregulated investment scheme paying a 15% annual ROI, claiming that it is “low risk – high reward”, and claiming that it’s not an investment scheme is not being clear or transparent.

    We do NOT advertise investment opportunities

    See above.

    and our adverts do not require approval by a Financial Conduct Authority regulated firm to sell commercial coffee machines or to rent commercial coffee machines on behalf of machine owners.

    The offer to take £3,600 from investors, and repay £5,700 over a six year term, with no day-to-day involvement from the punter who handed over £3,600, represents a collective investment security if funds are pooled to pay the promised return to investors. Whether the money is used to buy a coffee machine is irrelevant. See FCA v Capital Alternatives, FCA v Park First etc. Promoting that to potential investors most certainly does require FCA authorisation.

    Vista Rental Limited continues to make 100% of payments due to franchisees on time, every time.

    Which means nothing.

    Cafelavista continue to build a successful company and brand as can be seen by our Trustpilot reviews.

    Trustpilot reviews are worthless when it comes to investment securities. Blackmore Bond had around 400 positive Trustpilot reviews and a 5 star rating when it collapsed. You have 22 positive reviews. Whoop de do.

    Like

  5. Maybe they are just selling coffee machines at a very high mark up so your asset is the coffee machine. Buy a machine for £600, sell for £3000. If the rental is separate then if that goes belly up then you have a coffee machine you own that you need to retrieve from wherever it is located to get your asset backing. It might be worth peanuts but it’s your asset.

    I can’t imagine that the current time is a great place to be investing in coffee shops though. I suspect there may be a few machines on the market from Pret & Costa soon

    Like

  6. I am selling sealed envelopes for £3600. The contents are extremely valuable, but I can’t tell you what they are. If you send them back to me unopened in five years’ time, I will send you £5700. Opening them invalidates this guarantee, which is backed by my other business, selling carbon credits. The £3600 is a huge markup on the real* value of £600, but, hey, why bother investing £600 to get £1000, when there is £2000+ profit there for the taking.

    *By real, I mean entirely made up. The £3600 figure is 6x made up, which is a far better deal!

    Like

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