First of all, thanks for being cordial to the people who have been making accurate criticisms of this stock for a long time now, rather than merely hurling bile like 'bullshit statement!' or 'crap context!' around.
The problem (and this has been THE problem for some time now) is the same one faced by every growing startup: the question of growth. FUNN has been running net deficits, ostensibly to fund growth, and this comes at the cost of dilution.
Now, I realize that dilution is often fine, and can even be a GREAT thing -- provided by % equity issued for cash is _exceeded_ by the percentage growth that cash generates when invested into the business. That's why companies with phenomenal business models, and insanely high early ROI on invested capital are able to support high stock prices even as they dilute massively. Think Tesla or Amazon in the early days--big operating losses, big dilution, but even BIGGER growth. As a result the stock market was bullish on them, granting them high multiples and valuations...and that makes raising cash even easier! It's a virtuous cycle.
But the opposite is a vicious cycle--low growth and high dilution destroys confidence and equity, so the market is bearish, which makes each dollar raised even costlier from an equity perspective, and so forth. This is what we usually see on the OTC, because the companies are jokes which burn capital all the way until they're raising money at triple zeroes, rather than Ferraris like Amazon which know EXACTLY what to do to feed that 1$ invested into the 100+% annual growth rate in the early days, so investors are clamoring to get their money in at high valuations.
Snakes NEEDS to finally start understanding this basic finance 101 comprehension I have laid out here if it wants to survive. It's NOT impossible and despite it all it's STILL not too late. FUNN needs to stop trying to reinvent the wheel and secure long-shot, high-risk wins like buying Morning and NSI. KTU was a huge failure for the company, it was their #1 focus through all of 2018/2019, pretty much the only thing , and I doubt they have even recuperated their investment on it yet, let alone seen a big return.
Imagine if in early 2018 they have instead said, look, our core competitive advantage is the cafes--so we're going to roll out 10 over the next 2 years. To do that we need 5-7 million dollars. At a stock price of 10 cents (which we were above for over a YEAR), raising that kind of money will require 50-100M shares. Remember when the OS was 480M back in early 2018? We could be sitting on 13 cafes right now if they had gone with this, and we'd have the same OS of ~560M or less. We wouldn't have KTU. We wouldn't have the JRF partnerships. We wouldn't have Starlit Citadel. We wouldn't have a whole load of side projects. But we'd have 13 functional cafes, cemented ourselves as THE board game cafe big tajuna, and in all likelihood a booming PPS, because the company would be able to point to and promote tangible growth. The kind of growth that makes investors not care about adding 100M shares to the OS (~20% increase), because the company has grown by 100s of %.
That's what they need to do RIGHT NOW. They need to open a cafe and pump the crap out of that opening. Get the stock back into the .05-.10 range, whatever it takes. Then they need to close a major financing deal to open the next 3 cafes--issue 30-50M shares at .05-.10 to get that cash. It will be costly to turn this around now, because major mistakes have been made, but we still need to get back on that track -- more cafes, more profits to fund growth, growing PPS, meaning cheaper fundraising for even more growth. THAT is how a public growth company succeeds - every time. If Roger can't do it, he needs to go, now, return his preferreds to treasury, and be replaced by someone who can. It's really that simple. Make no mistake, shareholders are one more misstep away from seeing the million dollar net deficits here covered at a subpenny share price--that means billions of shares converting at all time lows, and the final dilution death spiral.
It must be avoided--things need to change, extremely rapidly, extremely efficiently, in a targeted way. Invest in cafes. Open cafes. Promote and market cafe openings to the market to boost the share price. Use that higher share price to fund more cafes. Repeat.
When there are 25 cafes open, throwing off several million dollars in free capital per year, and the stock is at .25 - .50, then it is time to start thinking about diversifying into things like KTU and seeking synergies. Then it is time to think about auditing the company, launching nation-wide franchising, and funding international business travel left and right. Until then, the focus here must be laser-like on growing the proven, competitive advantage of Snakes: the cafes.
This is the kind of rookie error that a pink novice like Roger makes, and will continue making, but that no MBA from even a semi-reputable program would have made. Roger: get business professionals on board. Now. Save the company while you still can. No one, I repeat no one, that has been holding FUNN/AMFE for years deserves to see this stock go below a penny. I don't want to see Snakes and Lattes, which really has the potential to be a wonderful, really big business, crushed in a humiliating way like that, along with the savings and dreams of thousands of small-time shareholders who took a leap of faith and held an OTC Pink sheet stock long, because they wanted to be part of a real startup story.
I can only pray CEO Roger Mortimer has it in him to swallow his pride and listen to reason. Please, put aside the ego and do what is right.
