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UPDATE (18 October 2019): Marek Zmyslowski has released a tell-all book after Interpol in May 2019 took down the Red Notice it issued in January 2018 ordering his extradition to Nigeria (see this story) — Ed
So confident was he that a deal to save his startup HotelOga by merging it with an East African entity would go through, that Polish entrepreneur Marek Zmyslowski sent out a press release and pitchdeck announcing the merger — when it had yet to be concluded. The proposed merger fell through shortly thereafter.
Nigerian investors have accused Zmyslowski of fraud (an accusation which he denies) – saying he funnelled company funds into his personal bank account and misled them about the existence of a Polish entity (Hotel Online sp. z.o.o) that housed the startup’s intellectual property (see this story), alongside a Nigerian entity Hotel Technology Solutions.
The investors who put money into HotelOga’s Nigerian entity Hotel Technology Solutions, include a business man Edmund Olotu (who has refused various attempts from Ventureburn to comment), Zmysłowski’s former CFO Gulbert Kiros (who has similarly not answered any calls or emails from Ventureburn) and Kenyan-born entrepreneur Maneesh Garg.
Zmyslowski claims he is the victim of investors who are trying to extort $300 000 from him by using an extradition request sent through Interpol. Garg denies these claims.
Before the merger was even concluded, Marek Zmyslowski issued a press release and sent investors a pitch deck about the deal — which later fell through
While Zmyslowski was still running HotelOga, he tried to save the ailing company by brokering a merger with an East African competitor, Savanna Sunrise. He approached the company in January 2017.
Yet before the merger was even done and dusted, Zmyslowski on 20 February 2017 issued a press release by phocuswire.com originally published on tnooz (see here and above screenshot), stating that HotelOga had merged with Savanna Sunrise. It further states that “HotelOga’s Marek Zmysłowski will become CEO of the new entity and Havar Bauck will assume the role of executive chairman”.
The deal however, never went through, as Bauck pulled out at the last minute.
But then later, after Zmyslowski dispensed of his shares in the Polish entity Hotel Online sp. z.o.o, Bauck brokered a deal with the Polish entity’s remaining shareholders, which included Zmyslowski’s former business partner Maciej Prostak.
‘Marek pushed for press release’
Bauck, who is the chairman of HotelOnline, told Ventureburn last month that putting out the press release was Zmysłowski’s doing.
“Marek was adamant about sending out a press release the moment we signed a letter of intent. We thought it was premature, but he kept insisting,” claimed Bauck in an email to Ventureburn.
Bauck said the parties had signed an earlier letter of intent with Hotel Technology Solutions (HotelOga’s Nigerian entity), which was terminated when Zmyslowski and the Polish team decided to go their separate ways.
The press release in February was in reference to the initial letter of intent with Hotel Technology Solutions, he said.
“We signed a binding letter of intent for the transaction with the Polish company on April 21st, 2017. Signatories were Endre Opdal (Bauck’s business partner) and myself for Savanna Sunrise, and Maciej Prostak, Damian Dabrowski and Szymon Peplinski for the Polish company,” he said.
Yet an earlier email from Bauck to Ventureburn dated 25 February, seems to contradict this. In the email Bauck said Savanna Sunrise took HotelOnline as its “trade name” in January 2017 “after completing the transaction with the Polish company”.
Subsequent to the publication of this article Bauck clarified that what he meant was that all that happened in January 2017 was an agreement between the parties that the merged company would take HotelOnline as its trading name.
“I never said we changed our name in January. We agreed during the merger talks that the merged company would take HotelOnline as its trading name. We stuck with that idea after the talks with HTS collapsed.
“We then rebranded to HotelOnline after completing the transaction with the Polish company,” he explained.
Pitch deck was lie
In addition, a pitch deck sent by Zmyslowski in an email dated 22 March 2017 to a “Jameel” to pitch for funding (and sent to Ventureburn by Zmyslowski — see below screenshot) shows the two companies as merged — when clearly no deal had been concluded yet.
Zmyslowski sent out the pitch deck to investors (according to him he, Opdal and Prostak met with Savannah Fund, and Luma VC) announcing the deal, seemingly with the full knowledge of Bauck — thus misrepresenting the company to investors.
Explained Bauck: “We all initially agreed that raising money should be a priority, and that we should use the momentum from a successful merger. Hence we started preparing a pitch deck at a very early stage”.
Logo, name mirrors HotelOga
Two more strange things stand out — firstly the name HotelOnline mirrors that of the Polish entity Hotel Online sp. z.o.o (in which Zmyslowski once had shares) — and secondly the logo that HotelOnline adopted (an “H” and “O” combined to look like a key) is exactly the same as that of the now defunct HotelOga (see below screenshots).
Bauck explained thats the parties had agreed on the name HotelOnline during the initial merger talks, when Hotel Technology Solutions was still involved. A receipt from GoDaddy for the domain name registration of HotelOnline.co sent by Bauck to Ventureburn is dated 7 March 2017.
“Keeping the HotelOga logo was part of the idea, as we all agreed that one was great. After the collapse of the inital talks, it turned out that the Polish company owned the rights to the logo, so we decided to stick with that part of the plan,” he said.
‘We didn’t try grab HotelOga clients’
When the Savanna Sunrise deal fell through, Zmyslowski tried to cut a deal in April 2017 with a South African company NightsBridge, to make an asset sale of his Nigerian business.
In an email dated 30 June 2017 to what is believed to be an attorney of HotelOga investor Maneesh Garg, Nightsbridge managing director Theresa Emerick wrote that she has been “very perturbed by the action of HotelOnline after being bought by Savannah Sunrise, as they re-entered the Nigerian market claiming all previous contracts and clients of HotelOga”.
“The claim to the market is that HotelOga (Hotel Technology Solutions) had been set up as a reseller only of the HotelOnline technology.” She said in the letter that she wonders if such an agreement even exists. “I’m very happy to provide proof of these actions, as I think it is reprehensible,” wrote Emerick.
But in an email to Ventureburn last month, Bauck denies that after the deal went through HotelOnline had tried to claim all those contracts and clients that HotelOga had at the time.
“All the hotels we work with in Nigeria, have contracts signed with us (Savanna Sunrise Ltd. t/a HotelOnline). We started from a scratch in Nigeria, with our own country team,” he said.
Added Bauck: “To my knowledge, Theresa (Enderick) made that statement in 2017. There was no direct dialogue between us then, and I believe she simply stated what she had been told at the time”.
While Zmyslowski claimed to Ventureburn that Bauck was no longer the chairman of HotelOnline, Bauck hit back saying he still was in charge.
“I am still the Chairman of HotelOnline. I don’t know why Marek would claim otherwise,” he said.
He said Prostak no longer has any role in the company. “He resigned as a board member in 2018 to pursue new opportunities,” he said.
Press release to get traction – Zmysłowski
Commenting via Whatsapp to Ventureburn, Zmyslowski said he gave his shares away to his business partners in the Polish entity Hotel Online sp. z.o.o “somewhere in the first quarter 2017”. He said he didn’t remember when exactly.
“We sent a press release before the deal, because we wanted to get traction and interest from investor. We wanted to start talks already as one company. We actually had two meetings with Savannah Fund, and Luma VC, where we went to pitch together (me, Maciej, Endre). And Maneesh (Garg) was helping us with contacts too…, ” he said.
He said he never received any money from giving his shares away to his former business partners.
“I gave them for free, to motivate them to stay with Savannah. Although I left, I wanted my people to have a job, and I wanted the company to survive. This wasn’t a financial motivation, it’s related to my morale,” he said.
He said he gave the shares to Szymon Peplinski, Damian Dabrowski, who he had hired initially as developers. “Later we gave them shares to keep them with the company,” he said.
Both Garg and Zmyslowski have yet to share with Ventureburn any legal documents pertaining to the fraud allegations against the Polish entrepreneur. It’s not clear whether the matter will ever be taken to court.
Even less clear is what Savannah Sunrise’s role was in this saga.
Editor’s note (13 March 2019): Ventureburn asked HotelOnline chairman Havar Bauck to explain why in an email to Ventureburn dated 25 February, he said Savanna Sunrise took HotelOnline as “our trade name” in January 2017 “after completing the transaction with the Polish company”. In a subsequent email he said a “binding” letter of intent for the transaction with the Polish company was signed on 21 April 2017.
Bauck responded subsequent to the publication of this article to say that he “never said we changed our name in January”.
“We agreed during the merger talks that the merged company would take HotelOnline as its trading name. We stuck with that idea after the talks with HTS collapsed. We then rebranded to HotelOnline after completing the transaction with the Polish company.
He said regarding the pitch deck mentioned in today’s article, that he and Zmyslowski had prepared this internally during the first round of negotiations. “The idea was to start approaching investors immediately upon completing the merger. This was obviously never meant to be shared externally until the merger was a done deal,” he added.
Bauck added that both Luma and Savannah Fund with which HotelOnline was interacting with at the time in a bid to close a funding round, knew about the details of the merger.
“Luma and Savannah Fund were familiar with the ongoing talks and the context, as we were talking to them already before the first round of merger talks. They were therefore given information we didn’t share with others,” Bauck said in an email to Ventureburn.
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Featured image: Former HotelOga founder Marek Zmysłowski (Facebook)