Finance

Sustainable fashion company Ziel funneled 7 tons intended for Groningen to the US

The size of the amount that disappeared to America is apparent from the second bankruptcy report of curator René Luinstra.

Sustainable fashion company

Fashion company Ziel was founded in 2015 in the US by the Dutch entrepreneur Marleen Vogelaar. The company assists fashion brands in the sustainable production of clothing.

In 2019, Vogelaar also set up a Dutch subsidiary for the development of software that allows web shops and fashion stores to have clothing made locally, only after it has been ordered.

Million dollar investment

Three investors promised to invest 4.4 million euros in the Dutch company last year. With that money, the technology had to be developed and a factory built in Groningen.

The largest investor was the Groeifonds, which was set up to strengthen the economy of the earthquake zone in Groningen with public money. The ideological investors Borski Fund and Purpose Ventures also contributed money.

Money to the US

Of the promised capital injection, EUR 2 million has already been transferred. But investors turned off the money tap after it turned out that Ziel Nederland did not live up to its promises, partly due to the outbreak of corona.

A large part of the money intended for the Netherlands appeared to disappear to the American parent company. As a result of the closed money tap, Ziel Nederland had to request a postponement of payment in June. The company went bankrupt in August.

Eight tons of credit

Curator René Luinstra has to settle the bankruptcy. In its recently published second bankruptcy report, Ziel Nederland provided no fewer than eleven loans to the American parent company Ziel Inc. between April 6 and December 22, 2020.

In this way, a total of 728,111 euros flowed to the US. Including interest, the bankrupt Dutch company now has more than 812,000 euros in credit from Ziel Inc. The trustee writes that he is ‘in consultation with the director of Ziel Inc about how these loans will be repaid’.

Small chance

Luinstra confirms to RTL Z that this is being discussed, but says that he cannot estimate how great the chance is that that money will actually come back.

“I am here, and America is there. It is therefore difficult for me to estimate. Of course I know that the economy is going up and down there. They were busy restarting the business, but now there is another lockdown.”

The trustee also emphasizes that the American mother does not have the money in a bank account and therefore cannot simply repay it. “It has been invested in projects and is not easy to get rid of. In addition, the company also has other debts. It is clear that it will take a long time to get the money back, if that succeeds at all.”

According to the website of the American Ziel, the sustainable company wanted to invest 1 million dollars (880,000 euros) at the end of last year in a company that makes mouth masks against corona. What became of those plans is not explained further.

The bankruptcy report also shows that the investors have not yet informed the bankruptcy trustee that they want their invested money back.

“They have not yet submitted a claim in the bankruptcy estate, and are therefore not yet included in the report,” explains Luinstra. “I do have a lot of consultation with them, because they are on the fence about the repayment of the loans.”

Accountability

Investment manager Christiaan Bout of the largest lender, Groeifonds, does not want to say much about the flop and cannot explain why no claim has been submitted to the bankruptcy trustee. “I was under the impression that it was done, but will check internally.”

Bout also does not want to say how much public money the fund invested in Ziel and saw it go up in smoke. “We only have to account for that to our shareholder. And that is what happened.”

Partner Simone Brummelhuis of the Borski Fund, which invests in female entrepreneurs, did not call back for comment. Founder Vogelaar has not yet responded to requests for an explanation, sent via email and Linkedin.

creditors

If the loans are not repaid by the American parent, there is no chance that the investors will see any of the investment back.

It is true that curator Luinstra managed to sell the intellectual property of Ziel’s tech platform, but that only brought in a meager 12,500 euros. In addition, priority creditors such as the tax authorities and the UWV still have approximately 66,000 euros in credit.

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