(worktoplay) A few points-
- Revenues are growing, but so is the burn-rate. Every company requires capital to grow, but at some point you have to take a realistic look at ROE/ROI. I'd be much less concerned with the PP if the gigantic (and it is indeed gigantic) compensation hadn't been handed out. If in the next 12 months, DNAP shows accelerated revenue growth, then I'll shut up about it. If they maintain losses quarter after quarter, I won't. In a nutshell - the millions of shares they just dished out better have a pay off.
- Maybe I'm just a traditionalist, but when I hear "Company X has $XXXXX dollars in the bank, I assume that money came from revenue spillover (money earned) - at least that's the way it's usually done. Selling shares to fill your coffers is totally artifical according to standard business practices. I come from the Warren Buffett school of thought and do not tolerate the new "dot-com" math - which is where you seem to get your philosophy. The scenario you posted borderlines on fraud in my opinion. I know I won't persuade you to see it my way, so let's agree to disagree on this point.
- Understood. However, I'm not so sure a grant will increase investor confidence. It would be a good thing insofar as it would keep DNAP from going bankrupt....more insulation. And it might make DNAPrint look more viable as an enterprise. But a commercial enterprise? I don't think so. People will gain confidence in them commercially when they start turning a profit. That's the key. Revenue growth is meaningless if you continue to burn more than you bring in. You can't keep saying "they need capital, they need capital!" when there is no return (as is the case thus far).
I understand that DNAPrint will soon see a major transformation and my fingers are crossed. It could turn out to be a smart move considering that their original business plan was failing - this is not a bash, it's reality. I can't comprehend how Dr. Frudakis plans on doing what he wants to do, but I'll give him the benefit of the doubt for now.
It certainly sounds interesting.
_spook
greatballsoffire
