Verb Technology Company, Inc. (VERB) is a dynamic force in the rapidly evolving landscape of interactive video-based social commerce and crowdfunding. With a strong focus on innovation and market disruption, VERB has carved out a unique position in two distinct, yet complementary, business units - MARKET.live and Go Fund Yourself.
Business Overview and History Verb Technology Company, Inc. was founded in 2014 as a developer of software-as-a-service (SaaS) applications for the direct sales industry. Initially, the company offered a suite of interactive video-based sales enablement business software products marketed on a subscription basis. These SaaS assets formed the core of Verb's business operations until mid-2023.
In June 2023, Verb made a strategic decision to sell all of its operating SaaS assets for $6.5 million, with $4.75 million paid in cash at closing. This pivotal move allowed the company to shift its focus and resources to its emerging MARKET.live and Go Fund Yourself business units. Prior to this sale, Verb faced several challenges, including significant net losses, struggles to achieve profitability, and issues maintaining compliance with Nasdaq listing requirements. These factors contributed to the company's decision to refocus its efforts on its newer, more promising business initiatives.
Since divesting its SaaS assets, Verb has been actively working to build out its MARKET.live and Go Fund Yourself platforms. The company has formed strategic partnerships, made technological integrations, and implemented new capabilities to drive growth in these emerging business units. This transformation marks a new phase in Verb's corporate development, as it navigates the dynamic market landscape with renewed agility and focus.
MARKET.live: Redefining the Livestream Shopping Experience MARKET.live, VERB's flagship offering, is a groundbreaking multi-vendor, livestream social shopping platform that leverages the convergence of ecommerce and entertainment. By integrating with popular social media platforms such as TikTok, Facebook, Instagram, and Pinterest, MARKET.live empowers brands, retailers, and creators to reach exponentially larger audiences through simultaneous livestream broadcasts.
One of the key innovations introduced by MARKET.live is its seamless, native, and friction-free checkout process. Through strategic integrations with platforms like META, MARKET.live has created a seamless shopping experience that allows users to browse products, add them to their cart, and complete transactions without ever leaving their preferred social media app.
VERB recently completed development work on a new MARKET.live capability that facilitated a deeper integration into the TikTok Shop social media platform, designed to expose MARKET.live shoppable programming to tens of millions of potential viewers/purchasers. The company also announced an expanded strategic relationship with TikTok, evidenced by a formal partnership with TikTok Shop. Under this partnership, MARKET.live became a service provider for TikTok Shop and was officially designated as a TikTok Shop Partner (TSP). As part of this arrangement, TikTok Shop refers consumer brands, retailers, influencers, and affiliate leads to MARKET.live for a menu of contract-based recurring fee revenue services.
Go Fund Yourself: Disrupting the Crowdfunding Landscape Complementing its MARKET.live platform, VERB has also developed Go Fund Yourself, a revolutionary interactive social crowdfunding platform. Go Fund Yourself combines a groundbreaking interactive TV show with MARKET.live's backend capabilities, allowing viewers to invest in real-time as they watch companies present before a panel of industry experts, or "Titans."
The Go Fund Yourself platform generates revenue through cash fees charged to issuers for appearing on the show, as well as a percentage of gross sales revenue for any products sold during the broadcasts. This platform caters to public and private companies seeking broad-based exposure across numerous social media channels for their crowd-funded Regulation CF and Regulation A offerings.
Stealth Mode Business Unit In addition to MARKET.live and Go Fund Yourself, VERB operates a third business unit that is currently in stealth mode. The company continues to refine the user experience and ramp up sales for this undisclosed venture, which complements its existing offerings and contributes to its overall revenue stream.
Financial Performance and Ratios As of the company's latest 10-Q filing for the period ending September 30, 2024, VERB reported a cash balance of $10.52 million and short-term investments of $5.08 million, showcasing a strong liquidity position. The company's current ratio stands at 4.05, indicating a healthy ability to meet its short-term obligations.
However, VERB has historically faced challenges in terms of profitability, with a net loss from continuing operations of $7.14 million for the nine-month period ended September 30, 2024. The company's operating cash flow for the same period was negative $6.90 million, highlighting the need for continued financial discipline and optimization.
Despite these challenges, VERB has demonstrated its ability to raise capital, with $18.60 million in net proceeds from common stock offerings during the first nine months of 2024. This infusion of funds has strengthened the company's balance sheet and provided the necessary resources to drive its strategic initiatives forward.
For the most recent fiscal year (2023), VERB reported revenue of $63,000, a net loss of $14,844,000, operating cash flow of -$8,742,000, and free cash flow of -$10,903,000. In the most recent quarter, the company reported revenue of $128,000, a net loss of $1,965,000, operating cash flow of -$1,651,000, and free cash flow of -$1,756,000.
Notably, the revenue of $128,000 in the most recent quarter represents a 341% increase from the $29,000 reported in the same quarter of the previous year. This significant growth is primarily attributed to revenue generated through the Company's partnership with TikTok and the TikTok-related and other services packages within the Company's MARKET.live business unit, as well as from the Company's Go Fund Yourself business unit.
It's worth noting that VERB's revenues during the three and nine months ended September 30, 2024 and 2023, were substantially all generated from clients and customers located within the United States of America.
Liquidity VERB's liquidity position remains strong, with a cash balance of $10.52 million and short-term investments of $5.08 million as of September 30, 2024. The company's current ratio of 4.05 indicates a robust ability to meet short-term obligations. Additionally, VERB's successful capital-raising efforts, evidenced by the $18.60 million in net proceeds from common stock offerings, have further bolstered its liquidity position.
The company's debt-to-equity ratio stands at 0.011 as of September 30, 2024, indicating a low level of leverage. The quick ratio, matching the current ratio at 4.05, further underscores VERB's strong short-term liquidity position. This financial stability provides VERB with the flexibility to invest in growth initiatives and weather potential market uncertainties.
Risks and Opportunities The livestream commerce and crowdfunding industries in which VERB operates are highly competitive and rapidly evolving, presenting both challenges and opportunities for the company. VERB faces competition from well-established players as well as emerging startups, requiring the company to continuously innovate and adapt to maintain its market position.
Additionally, VERB's reliance on integration with third-party social media platforms, such as TikTok and META, exposes the company to risks associated with changes in those platforms' policies or strategic priorities. The company's continued success is heavily dependent on its ability to navigate these external factors and forge strong partnerships that enhance its competitive advantages.
On the opportunities side, the growing popularity of livestream shopping and the increasing acceptance of crowdfunding as a viable financing channel present significant growth potential for VERB. The company's unique technological integrations and its ability to offer a seamless, engaging user experience position it well to capitalize on these market trends.
Outlook and Guidance In its most recent 10-Q filing, VERB reported a 406% year-over-year increase in revenue for the nine-month period ended September 30, 2024, driven by its MARKET.live and Go Fund Yourself business units. This impressive growth trajectory underscores the market's receptiveness to the company's innovative offerings.
While the company has not provided explicit financial guidance, management has expressed confidence in the continued momentum of its business. VERB's CEO has stated that the company's third-quarter results will be "exceedingly better" than the prior quarter, signaling the potential for further financial improvements.
The company's recent strategic initiatives, such as its expanded partnership with TikTok and the development of new platform integrations, are expected to contribute to VERB's future growth and market positioning. Investors will be closely monitoring the company's ability to capitalize on these opportunities and drive sustainable profitability.
Conclusion Verb Technology Company, Inc. (VERB) is a dynamic and forward-thinking player in the rapidly evolving fields of livestream commerce and crowdfunding. With its innovative MARKET.live and Go Fund Yourself platforms, the company has demonstrated its ability to disrupt traditional industry dynamics and capture the attention of a growing customer base.
While VERB has faced some financial challenges in the past, its strong liquidity position, capital-raising capabilities, and strategic focus on high-growth market segments suggest that the company is well-positioned to navigate the competitive landscape and capitalize on emerging opportunities. As VERB continues to refine its business model and forge strategic partnerships, investors will be closely watching to see if the company can translate its technological prowess into sustained financial success.
The company's three distinct, yet complementary business units – MARKET.live, Go Fund Yourself, and the stealth mode operation – provide a diversified foundation for growth. With its expanded partnership with TikTok, deeper platform integrations, and innovative approach to social commerce and crowdfunding, VERB is poised to capitalize on the convergence of e-commerce, entertainment, and social media. As the company continues to execute its growth strategy and refine its offerings, it has the potential to establish itself as a leader in the evolving digital commerce landscape.