S-1/A: Collective Audience Files Amendment to S-1 Registration for Resale of Common Stock and Warrants

Collective Audience, Inc. has filed an amendment to its S-1 registration statement to register the resale of up to 5,336,120 shares of common stock and 1,697,678 shares of common stock issuable upon exercise of warrants by selling securityholders.

Summary

• Collective Audience, Inc. has filed an amendment to its S-1 registration statement to register the resale of up to 5,336,120 shares of common stock and 1,697,678 shares of common stock issuable upon exercise of warrants by selling securityholders.
• The shares being registered include shares held by the sponsor, certain directors, the underwriter, and other selling securityholders.
• The company will not receive any proceeds from the sale of these securities by the selling securityholders, except upon the exercise of the warrants.
• The company is facing potential delisting from Nasdaq due to not meeting minimum market value requirements and has until June 19, 2024, to regain compliance.
• The company's independent auditor has expressed substantial doubt about its ability to continue as a going concern.
• The company is an emerging growth company and a smaller reporting company, which allows for reduced disclosure requirements.

Sentiment

Score: 3

Explanation: The document presents a mixed picture. While there are some positive aspects, such as the company's proprietary technology and growth strategies, the significant risks and uncertainties, including the going concern warning and potential Nasdaq delisting, weigh heavily on the overall sentiment.

Positives

• The company has a proprietary architecture called Marble that assembles consumer profiles and distributes data via a live auction.
• The company offers a self-service lead generation marketplace called Outcome targeting SMB service providers.
• The company's BattleBridge business unit provides full-service branding and digital marketing agency services.
• The company has a right of first refusal agreement with the Sponsor for up to $30 million in debt or equity financing.

Negatives

• The company's independent auditor has expressed substantial doubt about its ability to continue as a going concern.
• The company faces potential delisting from Nasdaq due to not meeting minimum market value requirements.
• The company has negative cash flow from operating activities.
• The company has substantial customer concentration, with a limited number of customers accounting for a substantial portion of revenues.
• The company relies on third-party providers to license certain intellectual property and to provide internet services.

Risks

• The company's independent auditor has expressed substantial doubt about its ability to continue as a going concern.
• The company faces potential delisting from Nasdaq, which could limit investors' ability to make transactions in its securities.
• The company's ability to be successful after the business combination will be totally dependent upon the efforts of its key personnel.
• The company has negative cash flow from operating activities.
• The company is subject to risks associated with changing technologies in the digital marketing industry.
• The company has substantial customer concentration, with a limited number of customers accounting for a substantial portion of revenues.
• The company relies on third-party providers to license certain intellectual property and to provide internet services.
• The selling securityholders may experience a more advantageous rate of return than the public security holders based on the current trading price.

Future Outlook

The company aims to provide a successful outcome for DLQ clients by connecting them to new consumers for their business. DLQs primary revenue generating models are the Push business unit and the BattleBridge business unit.

Industry Context

The company operates in the digital advertising and lead generation markets, which are experiencing growth. The lead generation market is forecast to grow to $9.6B by 2028, and the digital advertising market is expected to reach $123B by 2026.

Comparison to Industry Standards

• The company competes with advertising companies, web design firms, and other digital marketing companies.
• The company also competes with larger public companies such as AdTheorent (ADTH), Braze (BRZE), Quinstreet (QNST), EverCommerce (EVCM), Cardlytics (CDLX), and Porch Group (PRCH).

Management Changes

Related Party Transactions

• The company has related party receivables and payables with Logiq, Inc.
• The company entered into a Managed Services Agreement and Independent Contractor Agreement with a client, with compensation paid in restricted shares of Logiq, Inc.
• The company entered into a securities purchase agreement with a related party investor, Brown Stone Capital, Ltd.
• The company entered into a warrant purchase agreement with a related party investor, Brown Stone Capital, Ltd.

Stakeholder Impact

• Shareholders may experience dilution due to the issuance of additional shares.
• Shareholders face the risk of delisting from Nasdaq, which could limit their ability to trade the company's securities.
• Stakeholders are impacted by the company's ability to continue as a going concern.

Next Steps

• The company must regain compliance with Nasdaq listing requirements by June 19, 2024.
• The company will explore strategic alliances with enterprise investors.
• The company will continue to develop and implement its growth strategies.

Key Dates

Keywords

common stock, warrants, selling securityholders, registration statement, business combination, nasdaq, delisting, dlq, abri, market value