Borislav Tonev

Fastfunds Financial Corporation (OTCMKTS:FFFC) Comes Back with a Bang

by Borislav Tonev April 9, 2015

We often talk about toxic debt and dilution on these pages, but although these two phenomena are fairly common in Pennyland, some people might still be struggling to get to grips with how dangerous they can be. We'll now use Fastfunds Financial Corporation (OTCMKTS:FFFC, FFFC message board)'s historical performance and we'll try to show everybody just how petrifying convertible notes really are.

In January 2014, the number of issued and outstanding FFFC shares was sitting at about 663 million. In January 2015, it was hovering above 8.6 billion.

Of these shares, 6,464,694,820 were issued during the first nine months of last year as a conversion of $758,683 worth of debt and interest (the average conversion rate comes in at $0.0001 per share). Between October 1, 2014 and November 14, 2014, a further 716,716,418 shares saw the light of day in order to satisfy just $39,775 worth of convertible notes (resulting in a conversion rate of $0.00005 per share (yes, four zeros)).

That is a truly catastrophic dilution and although the company made some progress during the first three quarters of last year, the results aren't really solid enough to battle it. Here's what FFFC recorded on September 30:

  • cash: $45 thousand
  • current assets: $297 thousand
  • current liabilities: $10 million
  • quarterly revenues: $235 thousand
  • quarterly net loss: $748 thousand

It's fair to say that at the end of Q3 of 2014, FFFC's management team had not one, but two problems to address – they had to do something about the revenue generation and the profit margins, and they also had to patch up the crippled share structure. We can't blame them for not trying.

A couple of months ago, FFFC executed a 1 for 600 reverse split. Unfortunately, this squeezed the living daylights out of small existing shareholders, but on the bright side, it made the stock much more appealing to new investors.

The management team also tried to give the company a push in the right direction when, at the end of November 2014, they signed a licensing agreement related to the production, promotion, and sale of a Tommy Chong branded Cannabis GreenCard – a credit card which can supposedly be used in marijuana dispensaries. The people behind FFFC hoped that Tommy Chong's fame will bring some exposure to the company and by the looks of things, this strategy worked.

Yesterday, Mr. Chong was interviewed by Yahoo! Finance and he talked a little bit about his new credit card. FFFC issued a press release in an attempt to spread the word around properly and the results on the stock were absolutely profound.

In a matter of six and a half hours, investors managed to rack up a dollar volume of over $360 thousand and pushed the price from its previous close of $0.0026 all the way to $0.026 – a gain of about 920%.

We'll leave it up to you to decide whether a three-minute interview (FFFC's name wasn't mentioned during it, by the way) really is enough to warrant a price increase of more than 900%, but in the meantime, you might want to take a good look at another thing.

FFFC's management team did what they could to botch the share structure and they also seem to be pursuing additional business opportunities and revenue streams. They forgot to address the dilution problem, though.

On February 2, immediately after the massive split, there were about 14.3 million shares issued and outstanding. On March 12, this number was sitting at about 17.4 million. Yesterday, in a matter of just six and a half hours, investors traded more than 22 million shares.

Plenty of convertible notes were also picked up over the last few months and, as is often the case with FFFC, they can be turned into common stock at a 50% discount.

Comments 2

1. Guest
May 06, 2015, 01:47PM

Quotes How Jordan Belfort's Prison Bunkmate — Tommy Chong — Inspired Him To Write 'Wolf Of Wall Street'

2. Guest
May 06, 2015, 01:45PM

Quotes Talk about fame, how bout Tommy Chongs'bunk mate in prison was none other than the Wolf of Wall Street.

Google it and do an article bout that

FFFC is a very noteworthy story

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