Gowex: The MAB's Free Wi-Fi That Ended in Administration
Gotham City Research valued Gowex at zero euros in July 2014. The company admitted false accounts, filed for administration, and suspended its trading on the MAB.
English · Original discussion in Spanish · Published
Gowex: From a 13 Euro Target to a Report Valuing It at Zero
July 2014. Gowex is trading on the MAB (the Spanish Alternative Stock Market) after a rally that saw triple-digit gains and a legion of trinc. On July 1st, an analyst places the starting point of the alleged speculative movement at 5.5 Euros. A week later, a report from Gotham City Research claims the company is worth zero euros. The stock plummets, accounts are revealed to be false, and the company files for creditor protection. The speculative bubble bursts with trading suspended, and it remains unknown if it will ever reopen.
What Gowex Sold: Free Wi-Fi in Around 80 Cities
The business, on paper, was simple. Gowex offered free Wi-Fi in about 80 cities—New York, Paris, Madrid—with a stated goal of reaching 300 between 2018 and 2020. And where did the money come from if users didn't pay? From city councils and businesses that paid to offer the connection. In Nice, its access points were integrated into parking meters; on the street, the app aimed for any shoe store or restaurant to offer free internet in exchange for advertising and discounts.
So far, the story of a Spanish tech company going international. The problem arose with the awkward question: what technology did Gowex have that no one else could replicate?
The Rally and Rumors: From NASDAQ to 300 Euros Per Share
A declared revaluation of 122%, a target price of 13 Euros, and highs touching 12. Added to rumors of a takeover bid (OPA) and a possible move to NASDAQ, the cocktail was perfect. The company even shared an award with Carbures at the European Small and Mid-Cap Awards. There was speculation of shares reaching 300 Euros. Corrections, they said, never exceeded 15%: healthy dips, an opportunity to buy more.
With hindsight, that enthusiasm has a name: wishful thinking. And a warning that is usually ignored, always the same: this has all peine before and will happen again.
The Doubts No One Wanted to Hear: Fon and Wi-Fi Competition
Outside the bullish noise, there were questions from the start. What does Gowex offer that another company can't? Does it have proprietary technology? The comparison with Fon was immediate: in the UK, an operator had been sharing bandwidth among individuals for years and had millions of access points worldwide. And there was the more basic criticism: mobile phones offer increasingly more data for free, so free public Wi-Fi is a service of questionable value.
No one publicly found the technical differential that justified the valuation. That void—not a figure, a void—is what sustained the bubble.
The Report That Changed Everything and the Collapse
In early July, Gotham City Research published a report valuing Gowex at zero. The market reacted with falls, and many dismissed the document as suspicious, exaggerated, or self-serving. As a warning, the case of Quindell was cited: where there's smoke, there's fire.
There was fire. Within days, the falsity of the accounts was confirmed, the company filed for creditor protection, and trading was suspended indefinitely. The more seasoned investors recalled Terra and that delisting takeover bid whose price, in the words of the time, wasn't even worth the paper it was printed on.
False Accounts, Administration, and an Awkward Official Example
The company's management, led by Jenaro García, was implicated in falsifying accounts, according to published reports. The damage was not only to minority shareholders: the case added to a Spanish list that already included Pescanova. The political sting: not long before, the Prime Minister had held up Gowex as a model company to emulate.
The oversight that the CNMV (Spain's National Securities Market Commission) should have provided proved of little use. The accounts had been audited. And audited, they turned out to be false.
Here the analysis stalls. Affected parties hope to recover something; those who bet against the stock celebrate; and the scenario of a reopening at 0.01 remained unresolved. The only certainty is that free Wi-Fi ended up costing many people dearly.
July 2014. Gowex is trading on the MAB (the Spanish Alternative Stock Market) after a rally that saw triple-digit gains and a legion of trinc. On July 1st, an analyst places the starting point of the alleged speculative movement at 5.5 Euros. A week later, a report from Gotham City Research claims the company is worth zero euros. The stock plummets, accounts are revealed to be false, and the company files for creditor protection. The speculative bubble bursts with trading suspended, and it remains unknown if it will ever reopen.
What Gowex Sold: Free Wi-Fi in Around 80 Cities
The business, on paper, was simple. Gowex offered free Wi-Fi in about 80 cities—New York, Paris, Madrid—with a stated goal of reaching 300 between 2018 and 2020. And where did the money come from if users didn't pay? From city councils and businesses that paid to offer the connection. In Nice, its access points were integrated into parking meters; on the street, the app aimed for any shoe store or restaurant to offer free internet in exchange for advertising and discounts.
So far, the story of a Spanish tech company going international. The problem arose with the awkward question: what technology did Gowex have that no one else could replicate?
The Rally and Rumors: From NASDAQ to 300 Euros Per Share
A declared revaluation of 122%, a target price of 13 Euros, and highs touching 12. Added to rumors of a takeover bid (OPA) and a possible move to NASDAQ, the cocktail was perfect. The company even shared an award with Carbures at the European Small and Mid-Cap Awards. There was speculation of shares reaching 300 Euros. Corrections, they said, never exceeded 15%: healthy dips, an opportunity to buy more.
With hindsight, that enthusiasm has a name: wishful thinking. And a warning that is usually ignored, always the same: this has all peine before and will happen again.
The Doubts No One Wanted to Hear: Fon and Wi-Fi Competition
Outside the bullish noise, there were questions from the start. What does Gowex offer that another company can't? Does it have proprietary technology? The comparison with Fon was immediate: in the UK, an operator had been sharing bandwidth among individuals for years and had millions of access points worldwide. And there was the more basic criticism: mobile phones offer increasingly more data for free, so free public Wi-Fi is a service of questionable value.
No one publicly found the technical differential that justified the valuation. That void—not a figure, a void—is what sustained the bubble.
The Report That Changed Everything and the Collapse
In early July, Gotham City Research published a report valuing Gowex at zero. The market reacted with falls, and many dismissed the document as suspicious, exaggerated, or self-serving. As a warning, the case of Quindell was cited: where there's smoke, there's fire.
There was fire. Within days, the falsity of the accounts was confirmed, the company filed for creditor protection, and trading was suspended indefinitely. The more seasoned investors recalled Terra and that delisting takeover bid whose price, in the words of the time, wasn't even worth the paper it was printed on.
False Accounts, Administration, and an Awkward Official Example
The company's management, led by Jenaro García, was implicated in falsifying accounts, according to published reports. The damage was not only to minority shareholders: the case added to a Spanish list that already included Pescanova. The political sting: not long before, the Prime Minister had held up Gowex as a model company to emulate.
The oversight that the CNMV (Spain's National Securities Market Commission) should have provided proved of little use. The accounts had been audited. And audited, they turned out to be false.
Here the analysis stalls. Affected parties hope to recover something; those who bet against the stock celebrate; and the scenario of a reopening at 0.01 remained unresolved. The only certainty is that free Wi-Fi ended up costing many people dearly.
Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (220 replies).
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