Keep the cool aid flowing

Good Morning Dear Friends

Please share some of that cool aid you’ve been drinking, I think you’ve had enough of it. Are we even talking about the same company?

I cannot think their intention was anything other than raising funds. Why else would they commission two research reports on the back of unrealistic assumptions? As another friend who has been enjoying the cool aid said, it can be argued that the assumptions came from Redleaf. At the end of the day MYQ commissioned and announced the reports on the ASX platform. Had the company not approved the assumptions, they shouldn’t have released the reports as it creates a false market.

Further to this, if the company believes there is false or misleading information, including false rumor, circulating in the market, it must notify the ASX or the market immediately. If they did not think Redleaf’s assumptions were achievable, then they should have disclosed it to the market as investors could have been influenced by those assumptions.

My guess is that either the ASX/ASIC told them not to raise capital unless they clarified a few announcements, or the chairman advised against raising at an inflated price. He is a corporate lawyer and unlike our friends at GSW, this guy seems to be switched-on. He is on the board of a few other ASX companies.

Now to the financials…

Their December cash balance was $1.35 million with $593k in current payables. They are burning $650k a month (excluding license and app development fees) and already received their R&D reimbursement for FY2017. It’s not rocket science. By now their cash balance should be negative unless they have used their convertible note facility. They will probably receive a license payment from India at some stage which will pay the bills for a bit longer.

I also disagree with another post which claims the company is following some sort of a strategic plan. The first step of such plan if it existed would be to prove the accuracy, acceptability, and user retention of the app. They make all sorts of claims but have failed to show basic key metrics on the performance of their free version currently available. I personally have not used it but it’s got very mixed reviews.

Now once again, please give me some of that cool aid, I’m struggling to see all the greatness you keep on chatting about.

As always DYOR.