Thanks great to be here.
1.) "...cash burn was set up on assumptions pre-pandemic."
I guess I just have different expectations. Maybe I just expected it, although not at the crappy valuation. Looking at their cashflow, burning through 20M by Q3 last year, I just expected more raises. With the expansion into Alberta, I just expected more cash burn. That act alone probably added 1-2M last Q. I think they need another $50M after this round to get this thing going long term. I also think they need to really scale this thing as it seems to be a first to market + high relative switching costs. Retail banking is a similar analogy. Retail banking is competitive, but people are not likely to switch after they sign up with a particular bank - the effort to switch is more than the fees you pay. I'm of the opinion that they should go to the US, raise a bucket load and attack the market. But valuation matters obviously.
My message to them was, just tell people that you need more money and don't give false expectations. Be conservative. All these guys need are the right investors that will back the growth at good valuations because they can look out 5 years. Right now it seems like they have a bunch of short term investors who want a dividend to fund their retirement (exaggerating). I think if everyone just switch to that mindset and accepted dilution, things would be better.
2.) "Shouldn't the asset count backlog be growing while they are still restricted logistically if the demand is there?"
Yes I agree. What, they have 30M contractual backlog or 130M high potential TCV. Something like that. Maybe they can't get commitments with the logistical delays. Maybe people are still wait and see before they commit to $50-$150 a month. Maybe people don't want to sign a contract and wait 6 months to a year to get onto the system (I think this is the most likely case). I guess the key thing is for them continue to show new monthly connections with their current capabilities. They do need a sales backlog, but how it's defined between contractual backlog and high probability backlog isn't that important to me, nor is the size as it's a relatively fast sales cycle. I don't think most SaaS really have backlogs if they have a fast sales cycle. Usually you convert quickly. As long as it exists and continues to exist is good though. What's more important is their marketing reach long term.
3.) Yes I believe they recognize 20% upfront, and amortize the remaining TCV over the remaining contract duration. But that is earnings - the only thing that really matters is cash flow and that is MRR unless they "pull money up front".
4.) "Regarding the recent selling, where are you getting the 4M share count from? Is that the number of restricted shares that recently matured?"
I'm just guessing based on the volume since volume picked up at around $2. Sorry maybe around 2-3M shares if you add day by day when it really started to dip past $2. Maybe 1-2M if you factor in some shorts or others selling. I have no idea how many. I wouldn't be surprised to see more selling on monday. It seems like it will never end.
