Cannabis social media company MassRoots needs to dig up roughly $5 million in the coming year “to continue to fund operations,” according to its quarterly financial filings.
The Denver-based business ended the quarter on March 31 having posted total revenue of $134,721, according to documents filed with the Securities and Exchange Commission, which were first reported by MJ Business Daily. The net loss for the same period was $7,447,177.
MassRoots said in filing documents that the company expects “to raise a majority of these funds through warrant exercises,” adding that during the quarter that ended March 31, “we received approximately $4,443,000 proceeds from the exercise of our previously issued warrants.”
Capital obtained by selling MassRoots shares currently are crucial to keeping the company afloat, said the publicly traded company (OTCMKTS: MSRT).
“We are dependent on the sale of our securities to fund our operations, and will remain so until we generate sufficient revenues to pay for our operating costs,” the SEC filing says.
|Quarter ending March 31, 2017||Quarter ending March 31, 2016|
|Basic and diluted net loss per common share||(0.09)||(0.06)|
Compared to the same period of time last year, MassRoots increased its quarterly revenue by more than $37,000. But the company’s net loss nearly tripled, rising from $2.7 million to $7.4 million.
In March of last year, MassRoots efforts to raise capital took a hit when the New York Stock Exchange rejected the company’s bid to be listed on that exchange. The company lamented the decision as “a dangerous precedent that will prevent nearly every company in the regulated cannabis industry from listing on a national exchange.” Compared to the same period of time last year, MassRoots increased its quarterly revenue by more than $37,000. But the company’s net loss nearly tripled, rising from $2.7 million to $7.4 million.
Then, in September 2016, the company notified the SEC that it had defaulted on a $1.5 million promissory note. Five days later, MassRoots Chairman and CEO Isaac Dietrich issued a letter to the company’s investors, in which he omitted mention of the SEC notice and instead gave an upbeat overview of the company’s financials and reporting excellent quarterly results.
In 2015, MassRoots bought $175,000 worth of preferred shares in Flowhub LLC, a seed-to-sale system, which at the time comprised 8.95% of Flowhub’s outstanding equity. MassRoots also invested $100,0000 in HighTimes and completed its acquisition of Colorado-based DDDigital and subsidiary Whaxy.
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