NeoMedia Technologies, Inc (NEOM)

[Poptech]

diamond: It is the big question. Why would YA keep lending $450,000 a month into a company with less than $2M a year in revenue? We have all been stumped on that one. It is the equivalent of a person making $150,000 a year buying another new Aston Martin every four months. My best guess, YA continued to loan to NeoMedia to support previous investments in NeoMedia. If you stop feeding the investment, you lose the whole bet. YA is a rough area of investment. They lend to the distressed when nobody else will. PIPEs typically don't have great returns.

YA went from a $1B fund to $500M in assets in a short period of time. You will be pleased to know that cut the fund manager's take home in half.