Updates from Treasury (Q1, 2022)
Fortune favours the prepared mind..
We just closed out our first quarter, and as you might have noticed it has been a fairly active one. Our social media has been kicked off, as you could read from the insight in the performance marketing post, published yesterday by Scarlet. Some of our activities seems to be working, while others still need fine-tuning going forward, I consider this natural. We continue to be of the belief that, failing fast and course correcting, is much healthier than to try and make something successful, that doesn’t stand a chance of every becoming so — admit defeat and more on, so we continue to learn and will adapt / adjust our activities.
A couple of points to mention before we go into the numbers, last quarter we saw a jump in some of our costs, IT and design work, are two such costs, we need to recognise that these costs are one-time hits for forward projected work. I could book these costs as monthly reoccurring costs (e.g. our domain can be paid monthly), however I have decided to take them as a one-time cost, and not having to worry about monthly renewals.
Another aspect for us to consider is that, building a brand from scratch, we know, we will have to spend more on marketing than an established brand (you will recall this comment from my last update). For the month of March that has certainly been the case. As for general sales, revenue and profit, we are going live with our first collection this month (April), I would expect us to generate real sales only after 15th of April.
As for our Q1 actuals, we saw a net income from staking & interests earned coming in at $5.91, while cost for the month of March closed at $1854,17 (excluding minting costs, this came in at around 4 Sol.), leaving us with a net loss of $1848,26. The total net loss of Q1 came in at $2631,32 slightly higher than I had initially budgeted with. The main reasons for this, was due to the extraordinary costs for minting, that was caused by technical issues from both Solsea, Bundlr and ARweave. However we still ended up paying the network fees!
If our marketing activities has the effect that we expect, and our community is reacting favourable to our first collection, I firmly believe we can become cash-flow neutral by end of April early May. As we become cashflow positive, we need to start to build out our cash pillow one step at a time, while remaining cautious of not taking on too much risk (I will go in details on this when I will be discussing our future portfolio composition). While we will start to generate sales, and eventually become cash-flow neutral — and even turn a profit, we all need to be well aware of the fact that we will continue to reinvest in our business, primarily focused on design work, marketing, and minting fees.
Our focus remains ultra-long term, and so building the foundation in the beginning, takes much more effort, time, focus and money, the long term outcome will inevitably be much more sustainable, for our business and more importantly for our investors!
Bucky,
Head of Treasury,
#CMA Squad member,
