Tuesday, May 02, 2023 12:05:18 PM
The funny thing about money lenders is that they want to be as sure as possible that they get paid back. That requires some sort of collateral or a pledge of revenue so that even if the company fails the lender is able to recoup some of what they lent out.
The company has already pledged a portion of future revenues to an existing lender.
What collateral does VERB have to offer?
The company is left with two choices:
1) Raise capital by issuing new shares, thus diluting existing holders.
2) Issue convertible debt, which allows the lender to convert the debt into shares. This also dilutes existing shareholders.
Perhaps a VC could step in to fund VERB. Of course they would want a big chunk of equity in return and they would likely want a significant presence on the BOD. First thing the VC would do is show Rory the door.
The company has already pledged a portion of future revenues to an existing lender.
What collateral does VERB have to offer?
The company is left with two choices:
1) Raise capital by issuing new shares, thus diluting existing holders.
2) Issue convertible debt, which allows the lender to convert the debt into shares. This also dilutes existing shareholders.
Perhaps a VC could step in to fund VERB. Of course they would want a big chunk of equity in return and they would likely want a significant presence on the BOD. First thing the VC would do is show Rory the door.
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