What?!?! Another positive observation!
Inspired by Johnny Tarr (who was in a seemingly sober frame of mind when he posted). Maybe he'll buy me a beer one day in appreciation of this.
I wish I knew more about the terms through which investments in 19 Degrees are being offered, but the company has been short on details, perhaps because they can only be sold to accredited investors in exempt offerings (which means that you can't go around publicly soliciting investments).
That said, the February 5th press release included some very good news, indeed, as to 19 Degrees Corporate Services. As of that date, the company had raised $708,400 from the sale of those units.
Now, this is a bit of speculation, but educated speculation - I suspect that the funds that are raised through unit offerings in 19 Degrees is immediately available to the company. They are sold as securities, not franchises, so the pesky state rules do not apply - those rules in some states that require that franchise funds be escrowed pending delivery of the kiosks. So, when the company sells a unit, it generates immediately available cash! Couldn't happen too soon.
This makes me wonder what happens when a franchisee swaps his franchise rights for 19 Degrees units. Does the cash that he put up that is held in escrow get released to the company? Is the need to account for deferred revenues go away? I suppose it depends, at least in part, on the terms of the securities offering. Unfortunately, as I said above, I don't know what those might be.
Has anyone on this board been offered units in 19 Degrees? Care to share a bit about the terms offered? Johnny Tarr's fears notwithstanding, I won't "spin" it. I just want to know what the deal is and whether it might help increase cash available for operations.
AI
