The following discussion should be read in conjunction with our financial
statements and the related notes that appear elsewhere in this Annual Report.
The following discussion contains forward-looking statements that reflect our
plans, estimates and beliefs. Our actual results could differ materially from
those discussed in the forward-looking statements. Factors that could cause or
contribute to such differences include those discussed below and elsewhere in
this Annual Report on Form10-K.
Overview
We are a Nevada corporation formed on August 30, 1985. Our headquarters are in
Greenwood Village, Colorado. We have been engaged in our current business model
since June of 2016, as a result of our having been discharged from a
receivership and acquiring Life Marketing, Inc., which was in a different
industry as our previous business.
We have experienced recurring losses and negative cash flows from operations
since inception, including in our current business model. We anticipate that our
expenses will increase as we ramp up our expansion, which likely will lead to
additional losses, until such time that we approach profitability, or which
there are no assurances. We have relied on equity and debt financing to fund
operations to-date. There can be no guarantee that we will ever become
profitable, or that adequate additional financing will be realized in the future
or otherwise may be available to us on acceptable terms, or at all. If we are
unable to raise capital when needed, we would be forced to delay, reduce or
eliminate our expansion efforts. We will need to generate significant revenues
to achieve profitability, of which there are no assurances.
Trends and Uncertainties
Our business is subject to the trends and uncertainties associated with
expansion of niche industry social networks and ecommerce solutions are
increasing in popularity and availability. At some point, industry saturation of
technology solutions that we provide to, and support for TBI participant tech
startup companies will make it more difficult for our business model to expand.
This will force our company to innovate new technology solutions leading to
additional funding costs.
Going Concern
The accompanying financial statements have been prepared on a going concern
basis, which assumes that we will be able to realize our assets and discharge
our liabilities and commitments in the normal course of business for the
foreseeable future. We had an accumulated deficit of $32,793,526 at December 31,
2022. This factor raises substantial doubt about our ability to continue as a
going concern. Our ability to continue as a going concern is dependent upon our
generating profitable operations in the future and/or to obtain the necessary
financing to meet our obligations and repay our liabilities arising from normal
business operations when they come due. Our management intends to finance
operating costs over the next twelve months with existing cash on hand. While we
believe that we will be successful generating revenue to fund our operations,
meet regulatory requirements and achieve commercial goals, there are no
assurances that we will succeed in our future operations.
16
We will attempt to overcome the going concern opinion by increasing our TBI
licensing to additional tech company startups, thereby increasing our revenues,
which will increase our expenses and lead to possible net losses.
COMPARATIVE RESULTS FOR FISCAL YEARS
Results of Operations for the 12-month periods ended December 31, 2022 and 2021
Revenues
For the year ended December 31, 2022, we recognized $944,413 in revenues,
compared to $292,139 in revenue from licensing during the year ended December
31, 2021. The $652,274 increase in revenue is primarily attributable to the sale
of seven new digital asset platforms, the addition of one new TBI client
licensee, and revenue share from the existing TBI licensees.
Cost of Revenue
Cost of revenue was $48,217 for the year ended December 31, 2022 and $22,611 for
the year ended December 31, 2021. The increase is attributable to higher revenue
levels.
Operating Expenses
For the year ended December 31, 2022, we recorded $260,221 in operating expenses
compared to $654,128 in operating expenses for the year ended December 31, 2021,
a material decrease of $393,307. The decrease is attributable to a reduction in
2022 in all expense categories including a reduction of $52,681 in compensation
expense, a reduction of $6,782 in sales and marketing expense, and a reduction
of $334,444 in general and administrative expense.
Other income
During the year ended December 31, 2022 and 2021, we generated $91,411 of other
income and ($1,707,087) of other expense, respectively. The key contributing
factor in the 2022 period being the $41,111 PPP loan forgiveness, and other
income of $50,000 due to the reversal of an accrual. The loss in the 2021 period
is attributable to the loss of $1,551,768 on the extinguishment of debt, and
other expense of $155,319.
Net Profit (Loss)
As a result of the foregoing we generated a profit from continuing operation
$727,386 in net income during the year ended December, 2022, compared to a loss
of $2,091,687 during the year ended December 31, 2021.
For the year ended December 31, 2022 we had $-0- in net loss from discontinued
operations compared to $27,700 during the year ended December 31, 2021.
Liquidity and Capital Resources
Cash Flows from Operating Activities
Net cash provided by operating activities was $395,986 for the year ended
December 31, 2022 compared to $312,867 in net cash used during the year ended
December 31, 2021. The material increase in net cash provided during the 2022
period is primarily attributable to an improvement in profitability during the
2022 period.
Cash Flows from Financing Activities
Net cash used in financing activities was $197,452 during the year ended
December 31, 2022 compared to $313,450 provided by financing activities during
the year ended December 31 2021. The reduction in cash provided by financing
activities is attributable to our raising $100,000 from the sale of common stock
in the 2021 period compared to zero in the 2022 period and our CEO advancing
$213,450 in related party loans in the 2021 period, compared to a repayment of
$197,452 of those loans during the 2022 period.
© Edgar Online, source Glimpses