Member Info for Bantham

Thats clever of you Steve - only sells showing. You must have picked up a bargain.

You’ve been buying all the way down recently - apparently.

Whether you are or are not buying these shares - think for a moment that you are enticing people into a situation where they are very likely to lose 100% of their investment if they hold. Your forecasts of 11p / 25p take-over or whatever….. All nonsense as you may well realise.

Even the Carrot knows it’s nonsense.

It’s just maths.

This company doesn't have cash beyond the New Year. Its operating costs are over £1m per month. And it doesn't have any revenues to speak of.

And now it’s just taken the CEO and CFO off the Board because shareholders have lost confidence in them.

So it needs a lot of money - lets say min. £10m - fast.

And i can’t see who’s going to stump that up in the circumstances.

If you have ideas i am all ears.

This company has been on a one way trip to insolvency for a long time.

You may prefer to close your eyes to the inevitable, but one day you will be faced with the consequences whether you like it or not.

And i am only posting this so some succour doesn't read the nonsense you guys are posting , think they have a chance of a 400% return here and buys into this calamity.

DYOR etc

Same idea as this - Gold and Bitcoin have both demonstrated they are better stores of value than $/£ etc

Gold has an advantage because it’s got a much longer track record and is tradeable everywhere.

So if i were to get a shell company ( with some micro business ) and tell people i was going to raise capital and hold it in Gold, presumably the bulls on this board would be happy to buy equity in that at 4 times NAV or whatever multiple?

If not, where’s have i got this wrong?

Genuine question.

( For clarity i am invested in Bitcoin - it’s simply this model i am interested in thinking about )

One way to reduce the volatility and instill confidence would be to amend the management warrants to align them more with shareholders interests.

For instance, if he's confident that SWC will be worth £10 / £15 / £20 etc in the coming couple of years and enter the FTSE 100 he could change the strike price for his warrants to 100p. That would show great alignment and, whilst he gives up a lot of value against current NAV, he’s still going to make a fortune when the price keeps going up.

I realise he can’t get every original investor to do this but the insiders could all do something along those lines.

Anyone think he has such confidence in the future / desire to align himself with shareholders who have suffered all this volatility that he would do something like that?

My guess is he will hold tight to what he’s got.

maybe that’s an interesting thing to think about when considering an investment here.

You may be right Steve.

But it’s not fully funded is it. And it needs , say, £10m just to get to 2027. Who do you think is going to invest when all previous promises have been broken, there’s basically zero commercial traction and the CEO and FD have just been kicked off the Board for years of failure?

The answer is - ‘ no-one’.

So maybe Parsortix is a great thing. But when you run out of money and supporters with deep pockets - that’s called insolvency. And equity holders don’t tend to make more than zero in that situation. So maybe not one to bet the house on.

This company is close to insolvency. It’s ridiculous to think they could bring in a team to run it and turn it round before it runs out of money.

So anyone investing as a result of your comments is likely to lose every penny.

Angle’s value is zero - it’s just that there are some people trading it which creates an illusion that it’s even worth 3p. If it jumps up a bit that just gives people like Steve a chance to sell at maybe a profit. But illusions don’t last for ever - and it will end up at zero.

New investors - take care.

DTOR etc

Not a buy for me.

I would try it at 1.5 times fully diluted NAV - so maybe 75p.

But it’s possible it will never go that low.

In which case i am happy to miss out and watch the fun from the sidelines.

I could make arguments to value this at anything between 40p and 200p.

And where you land really just depends on your level of faith.

If they can get away a decent chunk of equity at 120p + it would be pretty strong sign.

I might have to revise my downbeat view if that happened.

Interesting.

I agree with you on the model. It avoids the ‘ponzi-like’ concerns of this structure.

To be clear - i am NOT suggesting this is a ponzi. I don’t think it is. But you do need to understand in what circumstances it works and in what it doesn’t. And you need to understand the enormous transfer of wealth from investors in the new equity to the holders of the warrants.

I think this team has really messed up here - too arrogant in pricing the equity and issuing that convert far too early.

So i think where we are today is a direct function of arrogance and bad execution.

So the question is, have they already blown up the model or is it still intact - just. Reasons for thinking they’ve blown it

- so much equity issued at prices where investors sitting on big losses

- the ‘ magic dust’ has evaporated

- the convert - why wouldn’t every investor want value underpinned like TOBAN?

- slowing equity issuance - especially since the convert

My guess is the FD paid the price for this bad execution - but in reality he probably wasn’t making the decision it was the CEO who probably fell into the trap of thinking he was a super-genius. Easy to do when you get to £1b market cap like that.

So reasons for thinking they may keep going?

- as things stand today i personally can’t see any

- however, maybe they have to re-think and re-launch. What might that look like? First, the senior team have to give up some of their warrants - recognising that the mismatch in interests between the warrant holders and equity investors is a massive issue. Second, they need to drop the silly constraint of issuing equity at a discount to current price. Then maybe they can start issuing equity at maybe a 50% premium to fully diluted NAV ? That would mean equity issuance at maybe 70p. And then you start to rebuild.

My thoughts are that they won’t do either of these things. If that’s the case i can’t see institutional investment at the current price in any scale ( it’s just catching a falling knife ) in which case the price may continue to drift down towards NAV. But the insiders will still have made out like bandits.

Thanks

Perhaps you could briefly explain what’s so good about BMV?

It’s the warrants that make this enterprise so beautiful.

There is zero risk - except from bitcoin price moving here and there.

There’s a mechanism for investors to buy equity at an enormous premium to the warrant price.

While the machine keeps going the NAV keeps going up. And the warrant holders know the very worst outcome for them is NAV - IE right now 20 times their recent investment.

No-one in their right minds would give that up.

In the end it’s just a beautiful mechanism to transfer wealth from post IPO investors to the warrant holders. And it’s done in plain sight.

I think it’s great.

Wrong call i think Ed1.

I reckon this will fly now - good commercial progress over the last six months, now properly cashed up and with an anchor shareholder. This is a lot of money and a massive vote of confidence. Looking very good.

Let’s see.

It’s a shame the bitcoin wizard can’t add up the cap table. He’s ignored the warrants when working out what he calls ‘ diluted shares’ so he’s over 100m shares low and his MNAV is 2.2 rather than around 3. It’s pretty basic stuff and you would hope a genius like him wouldn’t start his analysis with numbers which are miles off from the actuality.

Good point. Bad word.

The g/ood thing about this is that if the flywheel falters and they can’t raise equity at these prices they can still probably raise equity at above NAV - maybe 1.5 times

The other good thing is that the liquidation value is NAV - IE they can sell the bitcoin - it’s completely liquid - and distribute the NAV.

So there’s real assets underpinning this and the worst that you get is c.48p - subject to bitcoin price.

What i should have said is that there’s a risk it’s terminal for the model which i think to be exciting requires a lot of equity issuance and very good premia to NAV.

And having said all that - it’s still early days so anything can happen.

Personally i hope they can show they can keep on issuing equity at good premia as i would like this to be de-risked a little to invest.

I use this Board to help me think this through - so thanks for picking me up on that.

1. It’s still trading at above 3 times fully diluted NAV

2. The convert wasn’t well thought through - they’ve given downside protection too early to an investor and everyone will want that now.

3. Too many equity investors are sitting on big losses

4. It’s so volatile - but basically hugely downwards in last month - so if you want to invest why not wait a bit

5. The warrants skew the economics massively in favour of the insiders - 48p of NAV is worth 20 times their warrant cost but it’s a third of the current share price

6. The flywheel depends on bitcoin and share price appreciation. It works in reverse when both decline

7. Too much hot money - in and out

8. As share price declines and equity issuance slows ( as may be happening now ) the massive transference of value from equity investors to the warranties holders becomes more obvious

Any one of these is a problem. Taken together they have the potential to be terminal.

We will see.

I think there are multiple valuation risks at this price level.

However, IF Bitcoin performs strongly and IF they can keep raising equity this will be very interesting longterm.

Short-term i am not happy with risk / reward.

But if they can raise a lot more equity ( not converts ) at £2+ then the risk / balance may get more favourable.

That’s why it’s so interesting for me ATM.