An Ocado-backed technology firm which planned to establish a UK-wide network of pipes to deliver food and other goods to customers has gone into voluntary liquidation.
Magway’s ambition was for pods powered by magnets to carry products along pipes from distribution centres to consumers.
The “all-electric zero-emissions delivery system” promised to replace HGVs, moving groceries and online orders down metre-wide underground and overground tubes between hubs using magnetic waves.
A route for the delivery pipes – which were touted as a clean energy alternative to HGVs and solution to motorway congestion – was initially planned between Ocado sites in Hatfield and Park Royal in west London. Other routes between UK airports and the small DCs that serve their restaurants and retailers were also planned.
But its lofty ambition has proved a pipe dream, with Magway now having appointed liquidators, The Grocer can reveal.
“The short story is we were trying to bring in funds from investors and clients but unfortunately ran out of runway,” the company’s co-founder and CEO Phill Davies said. “It is a great shame. The team worked tirelessly until the very end.”
Magway’s shareholders are likely to lose more than £5.7m, with many of them having invested in the company over multiple crowdfunding rounds. Among them is Money Saving Expert founder Martin Lewis, who was the company’s third-biggest shareholder after its two co-founders.
The Wembley-based company – which was founded in 2017 by Davies and Rupert Cruise, an engineer on Elon Musk’s Hyperloop project – owes more than £40,000 in taxes to HMRC and over £47,000 in arrears and holiday pay to employees. Magway has just over £74,000 left in the bank.
Liquidators Alvarez & Marsal will be marketing Magway assets including its intellectual property for sale.
“Over the last seven years we have gained global recognition and traction, won numerous awards, filed multiple patents, and built working prototypes of our groundbreaking system, and despite our current situation I could not be prouder of the Magway team and what we have managed to achieve,” Davies told The Grocer.
“While this chapter closes, I firmly believe Magway’s innovative technology still holds huge potential, offering a more sustainable and efficient solution for bulk material movement. I hope the seeds we’ve planted will one day flourish.”
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