[Brad]

All,

After our webinar with Neil and some of the emphasis we discussed on the future of direct to customer (D2C) retail. I like these guys, I’m interested to see what they do on the public market with a planned launch early in 2021. **Disclaimer** I invested in their previous round as well as this round.

They focus on building lifestyle brands and building a portfolio to consolidate the overhead into a single entity. Take a look at a 30% discount on the IPO. Deal closing 21 Dec.

https://wefunder.com/digitalbrandsgroup/about

Hope to hear everybody’s thoughts,

Brad

Topic

[Merlynmac]

#326337

Hi Brad,
Here’s part of an assessment I did on another platform:

“My first thought, after just a quick look at their financials:

Revenues down 20% – yes COVID, so take it with a grain of salt
A Net Loss of over $5.6M
Short-term Debt of over $8.4M (an increase of 41%)
Cash-on-hand of just over $208K
A 3-month revenue average of just under $60K – It is nice to see revenues cover COGS and operational expenses but it will take some time for $60 a month to put a dent in that debt.

I wanna steer way clear of it.”

If you like their products and take advantage of the perk (credit toward purchases), then the investment risk is offset by the amount you purchase with the perk (i.e. you paid a little more for that sweater if the company folds). The same can be said if the company does great (you got your sweater effectively making your $70 investment a $20 one, assuming the sweater was $50 but you get the investment benefit of the $70, etc.).

For me, the risk outweighs the potential rewards. Millions in the hole, hoping to IPO next year but many factors could kill that, and so on. If I were in need of a new wardrobe, I might reconsider because I’d spend most of that money buying clothes anyway so the investment isn’t as much of a risk.

[Brad]

#326930

Thanks, many good points. Potentially a big learning opportunity for me, but will keep everybody posted. 

[Author]

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