Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 14, 2021 | |
Document Information Line Items | ||
Entity Registrant Name | Creatd, Inc. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 10,989,566 | |
Amendment Flag | false | |
Entity Central Index Key | 0001357671 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity File Number | 001-39500 | |
Entity Incorporation, State or Country Code | NV | |
Entity Interactive Data Current | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash | $ 2,802,772 | $ 7,906,782 |
Accounts receivable, net | 151,729 | 90,355 |
Prepaid expenses and other current assets | 566,727 | 23,856 |
Total Current Assets | 3,521,228 | 8,020,993 |
Property and equipment, net | 58,849 | 56,258 |
Intangible assets | 929,459 | 960,611 |
Goodwill | 1,035,795 | 1,035,795 |
Deposits and other assets | 291,836 | 191,836 |
Marketable securities | 62,733 | 62,733 |
Minority investment in businesses | 317,096 | 217,096 |
Operating lease right of use asset | 219,449 | 239,158 |
Total Assets | 6,436,445 | 10,784,480 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 1,849,136 | 2,638,688 |
Derivative liabilities | 344,404 | 42,231 |
Share liability | 187,500 | |
Convertible Notes, net of debt discount and issuance costs | 239,544 | 897,516 |
Current portion of operating lease payable | 87,912 | 79,816 |
Note payable - related party, net of debt discount | 5,397 | |
Note payable, net of debt discount and issuance costs | 1,423,995 | 1,221,539 |
Deferred revenue | 148,760 | 88,637 |
Total Current Liabilities | 4,286,648 | 4,968,427 |
Non-current Liabilities: | ||
Note payable | 54,298 | 213,037 |
Operating lease payable | 130,303 | 157,820 |
Total Non-current Liabilities | 184,601 | 370,857 |
Total Liabilities | 4,471,249 | 5,339,284 |
Commitments and contingencies | ||
Stockholders’ Equity | ||
Series E Preferred stock, $0.001 par value: 20,000,000 shares authorized; 1,088 and 7,738 shares issued and outstanding, respectively | 1 | 8 |
Common stock par value $0.001: 100,000,000 shares authorized; 10,925,026 issued and 10,915,676 outstanding as of March 31, 2021 and 8,736,378 issued and 8,727,028 outstanding as of December 31, 2020 | 10,925 | 8,737 |
Additional paid in capital | 80,633,380 | 77,505,013 |
Subscription receivable | (40,000) | |
Accumulated deficit | (78,572,159) | (71,928,922) |
Accumulated other comprehensive income | (44,545) | (37,234) |
Less: Treasury stock, 5,657 and 5,657 shares, respectively | (62,406) | (62,406) |
Total Stockholders' Deficit | 1,965,196 | 5,445,196 |
Total Liabilities and Stockholders’ Equity | $ 6,436,445 | $ 10,784,480 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Preferred stock, shares outstanding | 7,738 | 7,738 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 10,925,026 | 10,915,676 |
Common stock, shares outstanding | 10,925,026 | 10,915,676 |
Treasury stock, shares | 5,657 | 5,657 |
Series E Preferred Stock | ||
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 20,000,000 | 20,000,000 |
Preferred stock, shares outstanding | 1,088 | 1,088 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Net revenue | $ 743,913 | $ 293,142 |
Gross margin | 743,913 | 293,142 |
Operating expenses | ||
Research and development | 328,852 | 135,570 |
General and administrative | 6,361,058 | 1,983,521 |
Total operating expenses | 6,689,910 | 2,119,091 |
Loss from operations | (5,945,997) | (1,825,949) |
Other income (expenses) | ||
Other income | 63,556 | |
Interest expense | (198,671) | (375,530) |
Accretion of debt discount and issuance cost | (497,165) | (186,947) |
Derivative expense | (100,502) | |
Change in fair value of derivative liability | (197,389) | |
Settlement of vendor liabilities | 92,909 | (126,087) |
Gain (loss) on extinguishment of debt | 203,578 | (535,040) |
Other expenses, net | (697,240) | (1,160,048) |
Loss before income tax provision | (6,643,237) | (2,985,997) |
Income tax provision | ||
Net loss | (6,643,237) | (2,985,997) |
Deemed dividend | ||
Inducement expense | ||
Net loss attributable to common shareholders | (6,643,237) | (2,985,997) |
Comprehensive loss | ||
Net loss | (6,643,237) | (2,985,997) |
Currency translation gain (loss) | (7,311) | (9,239) |
Comprehensive loss | $ (6,650,548) | $ (2,995,236) |
Per-share data | ||
Basic and diluted loss per share (in Dollars per share) | $ (0.68) | $ (0.96) |
Weighted average number of common shares outstanding (in Shares) | 9,836,443 | 3,101,387 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Changes in Stockholders’ Equity (Deficit) (Unaudited) - USD ($) | Series E Preferred Stock | Series A Preferred Stock | Series B Preferred Stock | Series D Preferred Stock | Common Stock | Treasury stock | Additional Paid In Capital | Subscription Receivable | Accumulated Deficit | Other Comprehensive Income | Total |
Balance at Dec. 31, 2019 | $ 3,060 | $ (367,174) | $ 36,391,818 | $ (44,580,437) | $ (5,995) | $ (8,558,728) | |||||
Balance (in Shares) at Dec. 31, 2019 | 3,059,646 | (159,850) | |||||||||
Shares issued with notes payable | $ 3 | 31,635 | 31,638 | ||||||||
Shares issued with notes payable (in Shares) | 2,683 | ||||||||||
Shares issued for services | $ 50 | 584,950 | 585,000 | ||||||||
Shares issued for services (in Shares) | 50,000 | ||||||||||
Shares issued to settle vendor liabilities | $ 23 | 235,612 | 235,635 | ||||||||
Shares issued to settle vendor liabilities (in Shares) | 23,565 | ||||||||||
Conversion of warrants to stock | $ 5 | 5,767 | 5,772 | ||||||||
Conversion of warrants to stock (in Shares) | 5,000 | ||||||||||
Stock warrants issued with note payable | 504,856 | 504,856 | |||||||||
Foreign currency translation adjustments | (9,239) | (9,239) | |||||||||
Net loss | (2,985,997) | (2,838,498) | |||||||||
Balance at Mar. 31, 2020 | $ 3,141 | $ (367,174) | 37,754,638 | (47,566,434) | (15,234) | (10,191,063) | |||||
Balance (in Shares) at Mar. 31, 2020 | 3,140,894 | (159,850) | |||||||||
Balance at Dec. 31, 2020 | $ 8 | $ 8,737 | $ (62,406) | 77,505,013 | $ (40,000) | (71,928,922) | (37,234) | 5,445,196 | |||
Balance (in Shares) at Dec. 31, 2020 | 7,738 | 8,736,378 | (5,657) | ||||||||
Stock based compensation | $ 112 | 1,345,803 | 1,345,915 | ||||||||
Stock based compensation (in Shares) | 112,261 | ||||||||||
Shares issued for prepaid services | $ 40 | 191,960 | 192,000 | ||||||||
Shares issued for prepaid services (in Shares) | 40,000 | ||||||||||
Shares issued to settle vendor liabilities | $ 45 | 181,341 | 181,386 | ||||||||
Shares issued to settle vendor liabilities (in Shares) | 44,895 | ||||||||||
Common stock issued upon conversion of notes payable | $ 65 | 142,735 | 142,800 | ||||||||
Common stock issued upon conversion of notes payable (in Shares) | 65,328 | ||||||||||
Exercise of warrants to stock | $ 302 | 1,272,370 | 1,272,672 | ||||||||
Exercise of warrants to stock (in Shares) | 302,434 | ||||||||||
Cash received for preferred series E and warrants | (4,225) | $ 40,000 | 35,775 | ||||||||
Cash received for preferred series E and warrants (in Shares) | 40 | ||||||||||
Conversion of preferred series E to stock | $ (7) | $ 1,624 | (1,617) | ||||||||
Conversion of preferred series E to stock (in Shares) | (6,690) | 1,623,730 | |||||||||
Foreign currency translation adjustments | (7,311) | (7,311) | |||||||||
Net loss | (6,643,237) | (6,643,237) | |||||||||
Balance at Mar. 31, 2021 | $ 1 | $ 10,925 | $ (62,406) | $ 80,633,380 | $ (78,572,159) | $ (44,545) | $ 1,965,196 | ||||
Balance (in Shares) at Mar. 31, 2021 | 1,088 | 10,925,026 | (5,657) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (6,643,237) | $ (2,985,997) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 41,199 | 38,246 |
Accretion of debt discount and issuance cost | 497,165 | 186,947 |
Share-based compensation | 1,570,239 | 392,143 |
Settlement of vendor liabilities | (92,908) | 126,087 |
Change in fair value of derivative liability | 197,389 | |
Derivative expense | 100,502 | |
Loss on extinguishment of debt | (203,578) | 535,040 |
Non cash lease expense | 19,709 | 17,385 |
Changes in operating assets and liabilities: | ||
Prepaid expenses | (391,918) | |
Accounts receivable | (61,374) | (20,273) |
Deferred revenue | 60,123 | (6,681) |
Accounts payable and accrued expenses | (370,528) | 418,340 |
Operating lease liability | (19,421) | (16,100) |
Net Cash Used In Operating Activities | (5,296,638) | (1,314,863) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Cash paid for property and equipment | (12,637) | |
Deposits | (100,000) | |
Cash paid for minority investment in business | (100,000) | |
Net Cash Used In Investing Activities | (212,637) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from the exercise of warrant | 1,312,672 | |
Net proceeds from issuance of notes | 85,500 | 303,000 |
Repayment of notes | (43,716) | (40,000) |
Proceeds from issuance of demand loan | 100,000 | |
Proceeds from issuance of convertible note | 1,172,610 | |
Repayment of convertible notes | (941,880) | (75,000) |
Proceeds from issuance of note payable - related party | 152,989 | |
Repayment of note payable - related party | (180,273) | |
Purchase of treasury stock and warrants | (2,500) | |
Net Cash Provided By Financing Activities | 412,576 | 1,430,826 |
Effect of exchange rate changes on cash | (7,311) | (9,239) |
Net Change in Cash | (5,104,010) | 106,724 |
Cash - Beginning of Year | 7,906,782 | 11,637 |
Cash - End of period | 2,802,772 | 118,361 |
Cash Paid During the Year for: | ||
Income taxes | ||
Interest | 55,276 | 38,086 |
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Settlement of vendor liabilities for common stock | 168,667 | 37,500 |
Warrants issued with debt | 504,295 | |
Shares issued with debt | 32,200 | |
Issuance of common stock for prepaid services | 155,178 | 585,000 |
Conversion of note payable and interest into convertible notes | 385,000 | |
Conversion of Demand loan into notes payable | 150,000 | |
Deferred offering costs | 4,225 | |
Common stock issued upon conversion of notes payable | $ 142,800 |
Organization and Operations
Organization and Operations | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Organization and Operations | Note 1 – Organization and Operations Creatd, Inc., formerly Jerrick Media Holdings, Inc. (“we,” “us,” the “Company,” or “Creatd”), is a technology company focused on the development of digital communities, marketing branded digital content, and e-commerce opportunities. Creatd’s content distribution platform, Vocal, delivers a robust long-form, digital publishing platform organized into highly engaged niche-communities capable of hosting all forms of rich media content. Through Creatd’s proprietary algorithm dynamics, Vocal enhances the visibility of content and maximizes viewership, providing advertisers access to target markets that most closely match their interests. The Company was originally incorporated under the laws of the State of Nevada on December 30, 1999 under the name LILM, Inc. The Company changed its name on December 3, 2013 to Great Plains Holdings, Inc. as part of its plan to diversify its business. On February 5, 2016 (the “Closing Date”), GTPH, GPH Merger Sub, Inc., a Nevada corporation and wholly-owned subsidiary of GTPH (“Merger Sub”), and Jerrick Ventures, Inc., a privately-held Nevada corporation headquartered in New Jersey (“Jerrick”), entered into an Agreement and Plan of Merger (the “Merger”) pursuant to which the Merger Sub was merged with and into Jerrick, with Jerrick surviving as a wholly-owned subsidiary of GTPH (the “Merger”). GTPH acquired, pursuant to the Merger, all of the outstanding capital stock of Jerrick in exchange for issuing Jerrick’s shareholders (the “Jerrick Shareholders”), pro-rata, a total of 475,000 shares of GTPH’s common stock. In connection therewith, GTPH acquired 33,415 shares of Jerrick’s Series A Convertible Preferred Stock (the “Jerrick Series A Preferred”) and 8,064 shares of Series B Convertible Preferred Stock (the “Jerrick Series B Preferred”). In connection with the Merger, on the Closing Date, GTPH and Kent Campbell entered into a Spin-Off Agreement (the “Spin-Off Agreement”), pursuant to which Mr. Campbell purchased from GTPH (i) all of GTPH’s interest in Ashland Holdings, LLC, a Florida limited liability company, and (ii) all of GTPH’s interest in Lil Marc, Inc., a Utah corporation, in exchange for the cancellation of 39,091 shares of GTPH’s Common Stock held by Mr. Campbell. In addition, Mr. Campbell assumed all debts, obligations and liabilities of GTPH, including any existing prior to the Merger, pursuant to the terms and conditions of the Spin-Off Agreement. Upon closing of the Merger on February 5, 2016, the Company changed its business plan to that of Jerrick. Effective February 28, 2016, GTPH entered into an Agreement and Plan of Merger (the “Statutory Merger Agreement”) with Jerrick, pursuant to which GTPH became the parent company of Jerrick Ventures, LLC, a wholly-owned operating subsidiary of Jerrick (the “Statutory Merger”) and GTPH changed its name to Jerrick Media Holdings, Inc. to better reflect its new business strategy. On September 11, 2019, the Company acquired 100% of the membership interests of Seller’s Choice, LLC, a New Jersey limited liability company (“Seller’s Choice”). Seller’s Choice is digital e-commerce agency based in New Jersey (see Note 4). On September 9, 2020, the Company filed a certificate of amendment with the Secretary of State of the State of Nevada to change our name to “Creatd, Inc.”, which became effective on September 10, 2020. |
Significant Accounting Policies
Significant Accounting Policies and Practices | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies and Practices | Note 2 – Significant Accounting Policies and Practices Management of the Company is responsible for the selection and use of appropriate accounting policies and the appropriateness of accounting policies and their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The Company’s significant and critical accounting policies and practices are disclosed below as required by the accounting principles generally accepted in the United States of America. Basis of Presentation The Company’s condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and following the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These interim financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or any other interim period or for any other future year. These unaudited condensed financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2020, included in the Company’s 2020 Annual Report on Form 10-K filed with the SEC. The balance sheet as of December 31, 2020 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. Use of Estimates and Critical Accounting Estimates and Assumptions The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Principles of consolidation The Company consolidates all majority-owned subsidiaries, if any, in which the parent’s power to control exists. As of March 31, 2021, the Company’s consolidated subsidiaries and/or entities are as follows: Name of combined affiliate State or other jurisdiction of incorporation or organization Company Ownership Interest Jerrick Ventures LLC Delaware 100 % Abacus Tech Pty Ltd Australia 100 % Seller’s Choice, LLC New Jersey 100 % Jerrick Global, LLC Delaware 100 % Give, LLC Delaware 100 % Creatd Partners LLC Delaware 100 % Sci-Fi Shop, LLC Delaware 100 % OG Collection LLC Delaware 100 % VMENA LLC Delaware 100 % Vocal For Brands, LLC Delaware 100 % Vocal Ventures LLC Delaware 100 % What to Buy, LLC Delaware 100 % All inter-company balances and transactions have been eliminated. Fair Value of Financial Instruments The fair value measurement disclosures are grouped into three levels based on valuation factors: ● Level 1 – quoted prices in active markets for identical investments ● Level 2 – other significant observable inputs (including quoted prices for similar investments and market corroborated inputs) ● Level 3 – significant unobservable inputs (including our own assumptions in determining the fair value of investments) The Company’s Level 1 assets/liabilities include cash, accounts receivable, marketable trading securities, accounts payable, prepaid and other current assets, line of credit and due to related parties. Management believes the estimated fair value of these accounts at March 31, 2021 approximate their carrying value as reflected in the balance sheets due to the short-term nature of these instruments or the use of market interest rates for debt instruments. The Company’s Level 2 assets/liabilities include certain of the Company’s notes payable and capital lease obligations. Their carrying value approximates their fair values based upon a comparison of the interest rate and terms of such debt given the level of risk to the rates and terms of similar debt currently available to the Company in the marketplace. The Company’s Level 3 assets/liabilities include goodwill, intangible assets, marketable debt securities, equity investments at cost, and derivative liabilities, when they are recorded at fair value due to an impairment charge. Inputs to determine fair value are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models. Unobservable inputs used in the models are significant to the fair values of the assets and liabilities. The following table provides a summary of the relevant assets and liabilities that are measured at fair value on recurring basis: Fair Value Measurements as of March 31, 2021 Total Quoted Prices in Active Markets for Identical Assets or Liabilities Quoted Prices for Similar Assets or Liabilities Significant Unobservable Assets: Marketable securities - debt securities $ 62,733 $ - $ - $ 62,733 Total assets $ 62,733 $ - $ - $ 62,733 Liabilities: Derivative liabilities $ 344,404 $ - $ - $ 344,404 Total Liabilities 344,404 $ - $ - $ 344,404 The following table shows the valuation methodology and unobservable inputs for Level 3 assets and liabilities measured at fair value on recurring basis as of March 31, 2021: Fair Value Valuation Methodology Unobservable Inputs Marketable securities - debt securities $ 62,733 Discounted cash flow analysis Expected cash flows from the investment Derivative liabilities $ 344,404 Monte Carlo simulations and Binomial model Risk free rate Expected volatility Drift rate The following table provides a summary of the relevant assets that are measured at fair value on non-recurring basis: Fair Value Measurements as of March 31, 2021 Total Quoted Prices in Active Markets for Identical Assets or Liabilities Quoted Prices for Similar Assets or Liabilities Significant Unobservable Inputs Assets: Equity investments, at cost $ 317,096 $ - $ - $ 317,096 Total assets $ 317,096 $ - $ - $ 317,096 The following table shows the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on non-recurring basis as of March 31, 2021: Fair Value Valuation Methodology Unobservable Inputs Equity investments, at cost $ 317,096 Qualitative assessment per ASC 321-10-35 Qualitative factors The Company valued the initial value of debt securities, which are investments in convertible notes receivable, by assessing the separate values of the debt and equity components for similar instruments convertible into private company equity (Level 3). The investment was initially measured at cost, which was determined to approximate fair value due to the lack of marketability of the conversion shares underlying these convertible instruments and the expected recoverability of the note principal. The key assumption affecting the level 3 fair values would be collectability of the notes. The Company monitors for impairment indicators at each balance sheet date. Marketable debt securities as of March 31, 2021 are as follows: Fair Value Cost Unrealized Gains Fair Value Marketable securities - debt securities 3 $ 62,733 $ - $ 62,733 The change in net unrealized holding gain (loss) on debt securities available for sale that has been included in Accumulated Other Comprehensive Income as a separate component of Stockholder’s Equity for the three months ended March 31, 2021 and 2020 was $0 and $0, respectively. The Company recognizes impairment on loans or notes receivable (that do not meet the definition of a debt security) when it is probable that it will be unable to collect all amounts due according to the contractual terms, and the amount of loss can be estimated. The loss is estimated based on the present value of expected cash flows. During the three months ended March 31, 2021 the Company recognized a $0 credit loss on debt marketable securities. Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. At times, cash balances may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurable limits. The Company has never experienced any losses related to these balances. As of March 31, 2021, and December 31, 2020, cash amounts in excess of $250,000 were not fully insured. The uninsured cash balance as of March 31, 2021 was approximately $2.6 million. The Company does not believe it is exposed to significant credit risk on cash and cash equivalents. Long-lived Assets Including Goodwill and Other Acquired Intangibles Assets We evaluate the recoverability of property and equipment and acquired finite-lived intangible assets for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. The evaluation is performed at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability of these assets is measured by a comparison of the carrying amounts to the future undiscounted cash flows the assets are expected to generate from the use and eventual disposition. If such review indicates that the carrying amount of property and equipment and intangible assets is not recoverable, the carrying amount of such assets is reduced to fair value. We have not recorded any significant impairment charges during the three months ended March 31, 2021. Acquired finite-lived intangible assets are amortized on a straight-line basis over the estimated useful lives of the assets. We routinely review the remaining estimated useful lives of property and equipment and finite-lived intangible assets. If we change the estimated useful life assumption for any asset, the remaining unamortized balance is amortized or depreciated over the revised estimated useful life. During the year ended December 31, 2020 the Company completed its annual impairment test of goodwill. The Company performed the qualitative assessment as permitted by ASC 350-20 and determined that the fair value of the reporting unit was more likely than not equal or greater than the carrying value, including Goodwill. Based on completion of this annual impairment test, no impairment was indicated. Investments Marketable securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and are reported at fair value, with unrealized gains and losses recognized in earnings. Debt securities not classified as held-to-maturity or as trading are classified as available-for-sale, and are carried at fair market value, with the unrealized gains and losses, net of tax, included in the determination of comprehensive income and reported in stockholders’ equity. The Company accounts for its investments in available-for-sale debt securities, in accordance with sub-topic 320-10 of the FASB ASC (“Sub-Topic 320-10”). Accrued interest on these securities is included in fair value and amortized cost. Pursuant to Paragraph 320-10-35, investments in debt securities that are classified as available for sale shall be measured subsequently at fair value in the statement of financial position. Unrealized holding gains and losses for available-for-sale securities (including those classified as current assets) shall be excluded from earnings and reported in other comprehensive income until realized. The Company follows FASB ASC 320-10-35 to assess whether an investment in debt securities is impaired in each reporting period. An investment in debt securities is impaired if the fair value of the investment is less than its amortized cost. If the Company intends to sell the debt security (that is, it has decided to sell the security), an other-than-temporary impairment shall be considered to have occurred. If the Company more likely than not will be required to sell the security before recovery of its amortized cost basis or it otherwise does not expect to recover the entire amortized cost basis of the security, an other-than-temporary impairment shall be considered to have occurred. The Company considers the expected cash flows from the investment based on reasonable and supportable forecasts as well as several other factors to estimate whether a credit loss exists. If the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, the other-than-temporary impairment shall be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. The following table sets forth a summary of the changes in marketable securities - available-for-sale debt securities that are measured at fair value on a recurring basis: For the Total Beginning of period $ 62,733 Purchase of marketable securities - Interest due at maturity - Other than temporary impairment - Conversion of marketable securities - March 31, 2021 $ 62,733 We invest in debt securities. Our investments in debt securities are subject to interest rate risk. To minimize the exposure due to an adverse shift in interest rates, we invest in securities with maturities of two years or less and maintain a weighted average maturity of one year or less. As of March 31, 2021, all of our investments had maturities between one and three years. The marketable debt security investments are evaluated for impairment if events or circumstances arise that indicate that the carrying amount of such assets may not be recoverable. The following table sets forth a summary of the changes in equity investments, at cost that are measured at fair value on a non-recurring basis: For the Total Beginning of period $ 217,096 Purchase of equity investments 100,000 Conversion of marketable securities - March 31, 2021 $ 317,096 The Company has elected to measure its equity securities without a readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. An election to measure an equity security in accordance with this paragraph shall be made for each investment separately. The Company performed a qualitative assessment considering impairment indicators to evaluate whether these investments were impaired. Impairment indicators that the Company considered included the following: a) a significant deterioration in the earnings performance, credit rating, asset quality or business prospects of the investee; b) a significant adverse change in the regulatory, economic or technology environment of the investee; c) a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates; d) a bona fide offer to purchase or an offer by the investee to sell the investment; e) factors that raise significant concerns about the investee’s ability to continue as a going concern. Commitments and Contingencies The Company follows subtopic 450-20 of the FASB ASC to report accounting for contingencies. Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Foreign Currency Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at our Consolidated Balance Sheet dates. Results of operations and cash flows are translated using the average exchange rates throughout the periods. The effect of exchange rate fluctuations on the translation of assets and liabilities is included as a component of stockholders’ equity in accumulated other comprehensive income. Gains and losses from foreign currency transactions, which are included in SG&A, have not been significant in any period presented. Derivative Liability The Company evaluates its debt and equity issuances to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 815-10-05-4 and Section 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation and then the related fair value is reclassified to equity. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date. The Company adopted Section 815-40-15 of the FASB Accounting Standards Codification (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The Company changed its method of accounting for the debt and warrants through the early adoption of ASU 2017-11 during the three months ended December 31, 2017 on a retrospective basis. The Company utilizes a Geometric Brownian Motion (“GBM”) model and a Binomial model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The inputs utilized in the application of the GBM model included a starting stock price, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, and a risk-free rate. The inputs utilized in the application of the Binomial model included a stock price on valuation date, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, and a risk-free rate. The Company records the change in the fair value of the derivative as other income or expense in the consolidated statements of operations. Revenue Recognition Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. We determine revenue recognition through the following steps: ● identification of the contract, or contracts, with a customer; ● identification of the performance obligations in the contract; ● determination of the transaction price. The transaction price for any given subscriber could decrease based on any payments made to that subscriber. A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mille basis) and cash prizes offered to Challenge winners; ● allocation of the transaction price to the performance obligations in the contract; and ● recognition of revenue when, or as, we satisfy a performance obligation. Revenue disaggregated by revenue source for the three months ended March 31, 2021 and 2020 consists of the following: Three Months Ended 2021 2020 Agency (Managed Services + Branded Content) $ 428,300 $ 248,251 Platform (Creator Subscriptions) 306,902 35,962 Affiliate Sales 8,008 8,149 Other Revenue 703 780 $ 743,913 $ 293,142 Agency Revenue Managed Services The Company provides Studio/Agency Service offerings to business-to-business (B2B) and business-to-consumer (B2C) product and service brands which encompasses a full range of digital marketing and e-commerce solutions. The Company’s services include the setup and ongoing management of clients’ websites, Amazon and Shopify storefronts and listings, social media pages, search engine marketing, and other various tools and sales channels utilized by e-commerce sellers for sales and growth optimization. Contracts are broken into three categories Partners, Monthly Services, and Projects. Contract amounts for Partner and Monthly Services clients range from approximately $500-$7,500 per month while Project amounts vary depending on the scope of work. Partner and Monthly clients are billed monthly for the work completed within that month. Partner Clients may or may not have an additional billing component referred to as Sales Performance Fee, which is a fee based upon a previously agreed upon percentage point of the client’s total sales for the month. Some Partners may also have projects within their contracts that get billed and recognized as agreed upon project milestones are achieved. Revenue is recognized over time as service obligations and milestones in the contract are met. Branded Content Branded content represents the revenue recognized from the Company’s obligation to create and publish branded articles for clients on the Vocal platform and promote said stories, tracking engagement for the client. The performance obligation is satisfied when the Company successfully publishes the articles on its platform and meets any required promotional milestones as per the contract. The revenue is recognized over time as the services are performed and any required milestones are met. Below are the significant components of a typical agreement pertaining to branded content revenue: ● The Company collects fixed fees ranging from $10,000 to $110,000. ● The articles are created and published within three months of the signed agreement, or as previously negotiated with the client. ● The articles are promoted per the contract and engagement reports are provided to the client. ● Most billing for contracts occurs 50% at signing and 50% upon completion of the services, with net payment terms varying per client. ● Most contracts include provisions for clients to acquire content rights at the end of the campaign for a flat fee. Platform Revenue Creator Subscriptions Vocal+ is a premium subscription offering for Vocal creators. In addition to joining for free, Vocal creators now have the option to sign up for a Vocal+ membership for either $9.99 monthly or $99 annually, though these amounts are occasionally subject to promotional discounts. Vocal+ subscribers receive access to value-added features such as increased rate of cost per mille (thousand) (“CPM”) monetization, a decreased minimum withdrawal threshold, a discount on platform processing fees, member badges for their profiles, access to exclusive Vocal+ Challenges, and early access to new Vocal features. Subscription revenues stem from both monthly and annual subscriptions, the latter of which is amortized over a twelve-month period. Any customer payments received are recognized over the subscription period, with any payments received in advance being deferred until they are earned. The transaction price for any given subscriber could decrease based on any payments made to that subscriber. A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mille basis) and cash prizes offered to Challenge winners. Estimates are utilized for payments made for earnings through reads, by establishing the lifetime a subscriber has had a Vocal account, determining the percentage of that lifetime that the subscriber has been a paying customer, and applying that percentage to payments for earnings through reads in the relevant reporting period. Affiliate Sales Revenue Affiliate sales represents the commission the Company receives when a purchase is made through affiliate links placed within content hosted on the Vocal platform. Affiliate revenue is earned on a “click through” basis, upon referring visitors, via said links, to an affiliate’s site and having them complete a specific outcome, most commonly a product purchase. The Company uses multiple affiliate platforms, such as Skimlinks, Amazon, and Tune, to form and maintain thousands of vendor relationships. Each vendor establishes their own commission percentage, which typically range from 2-20%. The revenue is recognized upon receipt as reliable estimates could not be made. Deferred Revenue Deferred revenue consists of billings and payments from clients in advance of revenue recognition. As of March 31, 2021 and December 31, 2020, the Company had deferred revenue of $148,760 and $88,637, respectively. Accounts Receivable and Allowances Accounts receivable are recorded and carried when the Company has performed the work in accordance with managed services, project, partner, consulting and branded content agreements. For example, we bill a managed service client monthly when we have updated their Amazon store, modified SEO or completed the other services listed in the agreement. For projects and branded content, we will bill the client and record the receivable once milestones are reached that are set in the agreement. We make estimates for the allowance for doubtful accounts and allowance for unbilled receivables based upon our assessment of various factors, including historical experience, the age of the accounts receivable balances, credit quality of our customers, current economic conditions, and other factors that may affect our ability to collect from customers. During the three months ended March 31, 2021 the Company recorded $997 as a bad debt expense. As of March 31, 2021 and December 31, 2020, the Company has an allowance for doubtful accounts of $81,506 and $80,509, respectively. Stock-Based Compensation The Company recognizes compensation expense for all equity–based payments granted in accordance with Accounting Standards Codification (“ASC”) 718 “Compensation – Stock Compensation”. Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a five-year period (vesting on a straight–line basis). The fair value of a stock award is equal to the fair market value of a share of Company stock on the grant date. The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the value of the underlying share, the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is benchmarked against similar companies in a similar industry over the expected option life and other appropriate factors. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on its Common stock and does not intend to pay dividends on its Common stock in the foreseeable future. The expected forfeiture rate is estimated based on management’s best estimate. Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, our equity–based compensation could be materially different in the future. The Company issues awards of equity instruments, such as stock options and restricted stock units, to employees and certain non-employee directors. Compensation expense related to these awards is based on the fair value of the underlying stock on the award date and is amortized over the service period, defined as the vesting period, using the cliff straight-line method. The vesting period is generally one to three years. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant is used for restricted stock units. Compensation expense is reduced for actual forfeitures as they occur. Loss Per Share Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the |
Going Concern
Going Concern | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | Note 3 – Going Concern The Company’s condensed consolidated financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As reflected in the condensed consolidated financial statements, as of March 31, 2021, the Company had an accumulated deficit of $78.6 million, a net loss of $6.6 million and net cash used in operating activities of $5.3 million for the reporting period then ended. The Company is in default on debentures as of the date of this filing. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. On January 30, 2020, the World Health Organization declared the COVID-19 novel coronavirus outbreak a “Public Health Emergency of International Concern” and on March 10, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of the coronavirus include restrictions on travel, and quarantines in certain areas, and forced closures for certain types of public places and businesses. The COVID-19 coronavirus and actions taken to mitigate it have had and are expected to continue to have an adverse impact on the economies and financial markets of many countries, including the geographical area in which the Company operates. While it is unknown how long these conditions will last and what the complete financial impact will be to the Company, capital raising efforts and our operations may be negatively affected. The Company is attempting to further implement its business plan and generate sufficient revenues; however, its cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to further implement its business plan and generate sufficient revenues and in its ability to raise additional funds by way of a public or private offering of its debt or equity securities, there can be no assurance that it will be able to do so on reasonable terms, or at all. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business plan and generate sufficient revenues and its ability to raise additional funds by way of a public or private offering. The condensed consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. |
Equity investments, at cost
Equity investments, at cost | 3 Months Ended |
Mar. 31, 2021 | |
Investment Holdings [Abstract] | |
Equity investments, at cost | Note 4 - Equity investments, at cost The Company has elected to measure its equity securities without a readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. An election to measure an equity security in accordance with this paragraph shall be made for each investment separately. The Company performed a qualitative assessment considering impairment indicators to evaluate whether these investments were impaired. Impairment indicators that the Company considered included the following: a) a significant deterioration in the earnings performance, credit rating, asset quality or business prospects of the investee; b) a significant adverse change in the regulatory, economic or technology environment of the investee; c) a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates; d) a bona fide offer to purchase or an offer by the investee to sell the investment; e) factors that raise significant concerns about the investee’s ability to continue as a going concern. On October 2, 2020, the Company converted $102,096 of its marketable debt security into 119,355 shares of preferred stock or a 1.3% equity investment in a private company. On October 23, 2020, the Company entered into an equity interest purchase agreement whereas the Company purchased 3.8% ownership of a private company for $115,000. On February 17, 2021 the Company entered into a membership interest purchase agreement whereas the Company purchased another 3.3% ownership of a private company for $100,000. |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Notes Payable | Note 5 – Notes Payable Notes payable as of March 31, 2021 and December 31, 2020 is as follows: Outstanding Principal as of March 31, December 31, Interest Maturity Seller’s Choice Note $ 660,000 $ 660,000 30 % September 2020 The May 2020 PPP Loan Agreement 412,500 412,500 1 % April 2022 The April 2020 PPP Loan Agreement 262,432 282,432 1 % May 2022 The October 2020 Loan Agreement 57,273 55,928 14 % July 21 The November 2020 Loan Agreement - 23,716 14 % May 2021 The February 2021 Loan Agreement 86,089 - 14 % July 21 1,478,293 1,434,576 Less: Debt Discount - - Less: Debt Issuance Costs - - 1,478,293 1,434,576 Less: Current Debt (1,423,995 ) (1,221,539 ) Total Long-Term Debt $ 54,298 $ 213,037 As of March 31, 2021, if PPP loans payable are not forgiven, remaining scheduled principal payments due on notes payable are as follows: Twelve months ended March 31, 2021 $ 1,423,995 2022 54,298 $ 1,478,293 Seller’s Choice Note On September 11, 2019, the Company entered into Seller’s Choice Purchase Agreement with Home Revolution LLC (see Note 4). As a part of the consideration provided pursuant to the Seller’s Choice Acquisition, the Company issued the Seller’s Choice Note to the Seller in the principal amount of $660,000. The Seller’s Choice Note bears interest at a rate of 9.5% per annum and is payable on March 11, 2020 (the “Seller’s Choice Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts become due. Upon maturity the Company utilized an automatic extension up to 6 months. This resulted in a 5% increase in the interest rate every month the Seller’s Choice Note is outstanding. As of March 31, 2021 the Company is in default on the Seller’s Choice note. During the three months ended March 31, 2021 the Company accrued interest of $48,822. The April 2020 PPP Loan Agreement On April 30, 2020, the Company was granted a loan with a principal amount of $282,432 (the “Loan”), pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which was enacted on March 27, 2020. The Loan, which was in the form of a Note dated April 30, 2020 matures on April 30, 2022 and bears interest at a fixed rate of 1.00% per annum, payable monthly commencing on October 30, 2020. The Note may be prepaid by the Company at any time prior to maturity without payment of any premium. Funds from the Loan may only be used to retain workers and maintain payroll or make mortgage payments, lease payments and utility payments. During the three months ended March 31, 2021, the Company accrued interest of $696. During the three months ended March 31, 2021, the Company repaid $20,000 in principal. The Company is in the process of returning the funds received from the Loan. When the applications for PPP first opened up, there was limited available funding and much confusion surrounding the application process. The Company initially submitted its application for the May 2020 PPP Loan in early April but received no response in the aftermath of submitting the application. After consulting multiple advisors, the Company made the decision to apply elsewhere, due to the rampant media coverage of institutions running out of funding and the Company’s need for the capital and belief that if 2 separate loans were approved, the remaining application could simply be withdrawn. Therefore, in late April, the company proceeded with applying for the April 2020 PPP Loan. After some conflicting communications regarding acceptance, the Company attempted to contact the lender to clarify but got no response. After continued attempts to follow up with both lenders, the Company received approval for the May 2020 PPP Loan and funding for the April 2020 PPP Loan on the same day, followed the next day by the funding of the May 2020 PPP Loan. The Company immediately separated the funds for the April 2020 PPP Loan into a separate reserved bank account with the intention of returning the funds. However, after several attempts to contact the lender with no response, the Company was faced with difficulty raising funds in the early-Covid economy and made the decision to utilize the funds for operations and pursue an installment repayment plan when they were able to reach the lender. As of the date of this filing, the Company has begun making repayments on the loan, absent a formal installment agreement due to difficulties reaching the lender. The Company intends to complete repayment before the end of 2021. As each company is only permitted one loan under the CARES Act, there is a possibility the loan may be called by the SBA and the Company would have to repay the loan in full at such time. The May 2020 PPP Loan Agreement On May 4, 2020, Jerrick Ventures, LLC (“Jerrick Ventures”), the Company’s wholly-owned subsidiary, was granted a loan from PNC Bank, N.A. with a principal amount of $412,500, pursuant to the Paycheck Protection Program (the “PPP”). The Loan, which was in the form of a Note dated May 4, 2020 matures on May 4, 2022 and bears interest at a fixed rate of 1.00% per annum, payable monthly commencing on November 4, 2020. The Note may be prepaid by Jerrick Ventures at any time prior to maturity without payment of any premium. Funds from the Loan may only be used to retain workers and maintain payroll or make mortgage payments, lease payments and utility payments. Jerrick Ventures intends to use the entire Loan amount for qualifying expenses. Under the terms of the PPP, certain amounts of the Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act. During the three months ended March 31, 2021, the Company accrued interest of $1,017. The Company plans to apply for forgiveness of this loan and has begun discussions with the lender regarding that process. The October 2020 Loan Agreement On October 6, 2020, the Company entered into a secured loan agreement (the “October 2020 Loan Agreement”) with a lender (the “October 2020 Lender”), whereby the October 2020 Lender issued the Company a secured promissory note of A$74,300 AUD or $53,128 United States Dollars (the “October 2020 Note”). Pursuant to the October 2020 Loan Agreement, the October 2020 Note has an effective interest rate of 14%. The maturity date of the October 2020 Note is September 30, 2021 (the “October 2020 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the October 2020 Loan Agreement are due. The loan is secured by the Australian research & development credit. During the three months ended March 31, 2021 the Company accrued A$2565 in interest. The November 2020 Loan Agreement On November 24, 2020, the Company entered into a loan agreement (the “November 2020 Loan Agreement”) with a lender (the “November 2020 Lender”) whereby the November 2020 Lender issued the Company a promissory note of $34,000 (the “November 2020 Note”). Pursuant to the November 2020 Loan Agreement, the November 2020 Note has an effective interest rate of 14%. The maturity date of the November 2020 Note is May 25, 2021 (the “November 2020 Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under the November 2020 Note are due. During the three months ended March 31, 2021, the Company repaid $23,716 in principal and $4,736 of accrued interest. The February 2021 Loan Agreement On February 24, 2021, the Company entered into a secured loan agreement (the “February 2021 Loan Agreement”) with a lender (the “February 2021 Lender”), whereby the February 2021 Lender issued the Company a secured promissory note of A$111,683 AUD or $86,089 United States Dollars (the “February 2021 Note”). Pursuant to the February 2021 Loan Agreement, the February 2021 Note has an effective interest rate of 14%. The maturity date of the February 2021 Note is July 31, 2021 (the “February 2021 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the February 2021 Loan Agreement are due. The loan is secured by the Australian research & development credit. During the three months ended March 31, 2021 the Company accrued A$1,499 in interest. |
Convertible Note Payable
Convertible Note Payable | 3 Months Ended |
Mar. 31, 2021 | |
Convertible Note Payable [Abstract] | |
Convertible Note Payable | Note 6 – Convertible Note Payable Convertible notes payable as of March 31, 2021 and December 31, 2020 is as follows: Outstanding Principal as of Warrants granted March 31, December 31, Interest Conversion Maturity Quantity Exercise The September 2020 convertible Loan Agreement - 341,880 12 % $ - (*) September 2021 85,555 5 The October 2020 convertible Loan Agreement 169,400 169,400 6 % $ - (*) October 2021 - - The First December 2020 convertible Loan Agreement - 600,000 12 % $ - (*) December 2021 - - The Second December 2020 convertible Loan Agreement 169,400 169,400 6 % $ - (*) December 2021 - - 338,800 1,280,680 Less: Debt Discount (94,226 ) (309,637 ) Less: Debt Issuance Costs (5,030 ) (73,527 ) 239,544 897,516 Less: Current Debt (239,544 ) (897,516 ) Total Long-Term Debt $ - $ - (*) As subject to adjustment as further outlined in the notes The First July 2020 Convertible Loan Agreement On July 01, 2020, the Company entered into a loan agreement (the “First July 2020 Loan Agreement”) with an individual (the “First July 2020 Lender”), whereby the First July 2020 Lender issued the Company a promissory note of $68,000 (the “First July 2020 Note”). Pursuant to the First July 2020 Loan Agreement, the First July 2020 Note has interest of twelve percent (10%). The First July 2020 Note matures on June 29, 2021. Upon default or 180 days after issuance the First July 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to 61% multiplied by the lowest trade of the common stock during the twenty (15) consecutive trading day period immediately preceding the date of the respective conversion.t During the three months ended March 31, 2021 the First July 2020 Note became convertible. Due to the fact that these convertible notes have an option to convert at a variable amount, they are subject to derivative liability treatment. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The conversion feature has been measured at fair value using a Binomial model at the conversion date and the period end. The conversion feature of First July 2020 Note gave rise to a derivative liability of $112,743. The Company recorded $68,000 as a debt discount and $44,743 was recorded to derivative expense. The debt discount is charged to accretion of debt discount over the remaining term of the convertible note. During the three months ended March 31, 2021 the Company converted $68,000 in principal and $3,400 in interest into 35,469 shares of the Company’s common stock. The August 2020 Convertible Loan Agreement On August 17, 2020, the Company entered into a loan agreement (the “August 2020 Loan Agreement”) with an individual (the “August 2020 Lender”), whereby the August 2020 Lender issued the Company a promissory note of $68,000 (the “August 2020 Note”). Pursuant to the August 2020 Loan Agreement, the August 2020 Note has interest of twelve percent (12%). The August 2020 Note matures on August 17, 2021. Upon default or 180 days after issuance the August 2020 Convertible Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to 61% multiplied by the lowest trade of the common stock during the twenty (15) consecutive trading day period immediately preceding the date of the respective conversion. The Company recorded a $3,000 debt discount relating to original issue discount associated with this note. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.t During the three months ended March 31, 2021 the August 2020 Note became convertible. Due to the fact that these convertible notes have an option to convert at a variable amount, they are subject to derivative liability treatment. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The conversion feature has been measured at fair value using a Binomial model at the conversion date and the period end. The conversion feature of August 2020 Note gave rise to a derivative liability of $120,759. The Company recorded $65,000 was recorded as a debt discount and $55,759 was recorded to derivative expense. The debt discount is charged to accretion of debt discount over the remaining term of the convertible note. During the three months ended March 31, 2021 the Company converted $68,000 in principal and $3,400 in interest into 29,859 shares of the Company’s common stock. The September 2020 Convertible Loan Agreement On September 23, 2020, the Company entered into a loan agreement (the “September 2020 Loan Agreement”) with an individual (the “September 2020 Lender”), whereby the September 2020 Lender issued the Company a promissory note of $385,000 (the “September 2020 Note”). Pursuant to the September 2020 Loan Agreement, the September 2020 Note has interest of twelve percent (12%). The September 2020 Note matures on September 23, 2021. Upon default or 180 days after issuance the Second July 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share equal to the closing bid price of the Company’s common stock on the trading day immediately preceding the date of the respective conversion. The Company recorded a $68,255 debt discount relating to original issue discount associated with this note. The Company recorded a $146,393 debt discount relating to 85,555 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. During the three months ended March 31, 2021 the Company repaid $341,880 in principal and $46,200 in interest. The October 2020 Convertible Loan Agreement On October 2, 2020, the Company entered into a loan agreement (the “October 2020 Loan Agreement”) with an individual (the “October 2020 Lender”), whereby the October 2020 Lender issued the Company a promissory note of $169,400 (the “October 2020 Note”). Pursuant to the October 2020 Loan Agreement, the October 2020 Note has interest of twelve percent (6%). The October 2020 Note matures on the first (12 th Upon default or 180 days after issuance the October 2020 Note is convertible into shares of the Company’s common stock, par value $0.001 per share (“Conversion Shares”) equal to 75% of average the lowest three trading prices of the Company’s common stock on the fifteen-trading day immediately preceding the date of the respective conversion. The Company recorded a $19,400 debt discount relating to original issue discount associated with this note. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. During the three months ended March 31, 2021 the Second July 2020 Note became convertible. Due to the fact that these convertible notes have an option to convert at a variable amount, they are subject to derivative liability treatment. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The conversion feature has been measured at fair value using a Binomial model at the conversion date and the period end. The conversion feature of Second July 2020 Note gave rise to a derivative liability of $74,860. The Company recorded this as a debt discount. The debt discount is charged to accretion of debt discount over the remaining term of the convertible note. 22 The First December 2020 convertible Loan Agreement On December 9, 2020, the Company entered into a loan agreement (the “First December 2020 Loan Agreement”) with an individual (the “First December 2020 Lender”), whereby the First December 2020 Lender issued the Company a promissory note of $600,000 (the “First December 2020 Note”). Pursuant to the First December 2020 Loan Agreement, the First December 2020 Note has interest of twelve percent (12%). As additional consideration for entering in the First December 2020 convertible Loan Agreement, the Company issued 45,000 shares of the Company’s common stock. The First December 2020 Note matures on the first (12 th Upon default the First December 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to the closing bid price of the Company’s common stock on the trading day immediately preceding the date of the respective conversion. The Company recorded a $110,300 debt discount relating to original issue discount associated with this note. The Company recorded a $113,481 debt discount relating to 45,000 shares issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. During the three months ended March 31, 2021 the Company repaid $600,000 in principal and $4,340 in interest. The Second December 2020 Convertible Loan Agreement On December 30, 2020, the Company entered into a loan agreement (the “Second December 2020 Loan Agreement”) with an individual (the “Second December 2020 Lender”), whereby the Second December 2020 Lender issued the Company a promissory note of $169,400 (the “Second December 2020 Note”). Pursuant to the Second December 2020 Loan Agreement, the Second December 2020 Note has interest of twelve percent (6%). The Second December 2020 Note matures on the first (12 th Upon default the Second December 2020 Note is convertible into shares of the Company’s common stock, par value $0.001 per share (“Conversion Shares”) equal to 75% of average the lowest three trading prices of the Company’s common stock on the fifteen-trading day immediately preceding the date of the respective conversion. The Company recorded a $18,900 debt discount relating to original issue discount associated with this note. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. |
Related Party
Related Party | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party | Note 7 – Related Party Notes payable Notes payable – related party as of March 31, 2021 and December 31, 2020 is as follows: Outstanding Principal as of Warrants granted March 31, December 31, Interest Maturity Quantity Exercise The September 2020 Goldberg Loan Agreement 16,705 16,705 7 % September 2022 - - The September 2020 Rosen Loan Agreement 3,295 3,295 7 % September 2022 - - 20,000 20,000 Less: Debt Discount (14,603 ) (17,068 ) Less: Debt Issuance Costs - - 5,397 2,932 Less: Current Debt (5,397 ) (2,932 ) $ - $ - The September 2020 Goldberg Loan Agreement On September 15, 2020, the Company entered into a loan agreement (the “September 2020 Goldberg Loan Agreement”) with Goldberg whereby the Company issued a promissory note of $16,705 (the “September 2020 Goldberg Note”). Pursuant to the September 2020 Goldberg Loan Agreement, the September 2020 Goldberg Note has an interest rate of 7%. The maturity date of the September 2020 Goldberg Note is September 15, 2022 (the “September 2020 Goldberg Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under note are due. The September 2020 Goldberg Loan is secured by the tangible and intangible property of the Company. Since the September 2020 Goldberg Note has a make-whole provision if the shares of the Company’s common stock issued to the lender in accordance with the Lender’s Exchange Agreement (see note 11) have a value equal to or less than $7,737,594 determined by using the lowest VWAP of the last 30 days prior to September 14, 2021. The principal amount of the September 2020 Goldberg Note shall increase by 200% of the difference between the initial consideration and the September 14, 2021 value. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The make-whole feature gave rise to a derivative liability of $2,557,275, of which $2,540,570 was recorded as a loss on extinguishment of debt and $16,705 as a debt discount. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. The derivative liability is marked to market as of March 31, 2021, and the change in derivative liability is recorded on Condensed Consolidated Statements of Comprehensive Loss. See note 8. During the three months ended March 31, 2021 the Company accrued interest of $288. The September 2020 Rosen Loan Agreement On September 15, 2020, the Company entered into a loan agreement (the “September 2020 Rosen Loan Agreement”) with Rosen whereby the Company issued a promissory note of $3,295 (the “September 2020 Rosen Note”). Pursuant to the September 2020 Rosen Loan Agreement, the September 2020 Rosen Note has an interest rate of 7%. The maturity date of the September 2020 Rosen Note is September 15, 2022 (the “September 2020 Rosen Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under the note are due. The September 2020 Rosen Loan is secured by the tangible and intangible property of the Company. Since the September 2020 Rosen Note has a make-whole provision if the shares of the Company’s common stock issued to the lender in accordance with the Lender’s Exchange Agreement (see note 11) have a value equal to or less than $554,924 determined by using the lowest VWAP of the last 30 days prior to September 14, 2021. The principal amount of the September 2020 Rosen Note shall increase by 200% of the difference the initial consideration and the September 14, 2021 value. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The make-whole feature of gave rise to a derivative liability of $504,413, of which $501,118 was recorded as a loss on extinguishment of debt and $3,295 as a debt discount. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. During the three months ended March 31, 2021 the Company accrued interest of $57. Officer compensation During the three months ended March 31, 2021 the Company paid $20,082 for living expenses for officers of the Company. |
Derivative Liabilities
Derivative Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Liabilities | Note 8 – Derivative Liabilities The Company has identified derivative instruments arising from a make-whole feature in the Company’s notes payable at March 31, 2021. For the terms of the make-whole features see the September 2020 Rosen Loan Agreement and the September 2020 Goldberg Loan Agreement in Note 7. The Company has also identified derivative instruments arising from convertible notes that have an option to convert at a variable number of shares in the Company’s convertible notes payable at March 31, 2021. For the terms of the conversion features see Note 7. The Company had no derivative assets measured at fair value on a recurring basis as of March 31, 2021. The Company utilized a Geometric Brownian Motion (“GBM”) model and a binomial model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The inputs utilized in the application of the GBM model and binomial model included a starting stock price, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, and a risk-free rate. Risk-free interest rate: The Company uses the risk-free interest rate of a U.S. Treasury Note adjusted to be on a continuous return basis to align with the GBM model and binomial model. Dividend yield: The Company uses a 0% expected dividend yield as the Company has not paid dividends to date and does not anticipate declaring dividends in the near future. Volatility: The Company calculates the expected volatility based on the company’s historical stock prices with a look back period commensurate with the period to maturity. Expected term: The Company’s remaining term is based on the remaining contractual maturity of the convertible notes. The following are the changes in the derivative liabilities during the three months ended March 31, 2021. Three Months Ended March 31, Level 1 Level 2 Level 3 Derivative liabilities as January 1, 2021 $ - $ - $ 42,231 Addition - - 308,362 Extinguishment (203,578 ) Changes in fair value - - 197,389 Derivative liabilities as March 31, 2021 $ - $ - $ 344,404 |
Stockholders_ Equity
Stockholders’ Equity | 3 Months Ended |
Mar. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Stockholders’ Equity | Note 9 – Stockholders’ Equity Shares Authorized Prior to July 13, 2020, the Company was authorized to issue up to thirty-five million (35,000,000) shares of capital stock, of which fifteen million (15,000,000) shares are designated as common stock, par value $0.001 per share, and twenty million (20,000,000) are designated as “blank check” preferred stock, par value $0.001 per share. The designations, rights, and preferences of such preferred stock are to be determined by the Company’s board of directors. On July 13, 2020, the Company filed the Second Amended and Restated Articles of Incorporation with the Secretary of State of the State of Nevada, which authorize the issuance of 100,000,000 shares of common stock, and 20,000,000 shares of preferred stock. Preferred Stock Series E Convertible Preferred Stock On December 29, 2020 the Company entered into securities purchase agreements with thirty-three accredited investors whereby the Investors have agreed to purchase from the Company an aggregate of 7,778 shares of the Company’s Series E Convertible Preferred Stock, par value $0.001 per share and 2,831,715 warrants to purchase shares of the Company’s common stock, par value $0.001 per share. The Series E Preferred Stock is convertible into a total of 1,887,810 shares of Common Stock. The combined purchase price of one Conversion Share and one and a half warrant was $4.12. The aggregate purchase price for the Series E Preferred Stock and warrants was $7,777,777.77. The Company has recorded $817,353 to stock issuance costs, which are part of Additional Paid-in Capital. The warrants are exercisable for a term of five-years from the date of issuance, at an exercise price of $4.50 per share. The warrants provide for cashless exercise to the extent that there is no registration statement available for the underlying shares of Common Stock. The placement agent for the transaction and received cash compensation equal to 10% of the aggregate purchase price and warrants to purchase 471,953 shares of the Company’s common stock, at an exercise price of $5.15 per share (the “PA Warrants”). The PA Warrants are exercisable for a term of five-years from the date of issuance. During the three months ended March 31, 2021, the Company received the $40,000 of the subscription receivable for the Series E Convertible Preferred Stock. The Company has recorded $4,225 to stock issuance costs, which are part of Additional Paid-in Capital. During the three months ended March 31, 2021, investors converted 6,690 shares of the Company’s Series E Convertible Preferred Stock into 1,623,730 shares of the Company’s common stock. Common Stock On January 14, 2021, the Company issued 30,000 shares of its restricted common stock to consultants in exchange for services at a fair value of $133,200. On January 20, 2021, the Company issued 40,000 shares of its restricted common stock to consultants in exchange for a year of services at a fair value of $192,000. These shares were recorded as common stock issued for prepaid services and will be expensed over the life of the consulting contract to share based payments. During the three months ended March 31, 2021 the Company recorded $36,822 to share based payments. On February 1, 2021, the Company issued 50,000 shares of its restricted common stock to consultants in exchange for services at a fair value of $196,000. On February 3, 2021, the Company issued 1,929 shares of its restricted common stock to consultants in exchange for services at a fair value of $8,198. On February 18, 2021, the Company issued 10,000 shares of its restricted common stock to consultants in exchange for services at a fair value of $48,000. On February 18, 2021, the Company issued 10,417 shares of its restricted common stock to consultants in exchange for services at a fair value of $50,002. On February 26, 2021, the Company issued 291 shares of its restricted common stock to consultants in exchange for services at a fair value of $1,499. On March 17, 2021, the Company issued 9,624 shares of its restricted common stock to consultants in exchange for services at a fair value of $49,371. On March 28, 2021, the Company issued 31,782 shares of its restricted common stock to settle outstanding vendor liabilities of $125,000. On March 31, 2021, the Company issued 13,113 shares of its restricted common stock to settle outstanding vendor liabilities of $43,667. In connection with this transaction the Company also recorded a loss on settlement of vendor liabilities of $12,719. Stock Options The Company applied fair value accounting for all share-based payments awards. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used for options granted during the three months ended March 31, 2021 are as follows: March 31, Exercise price $ 2.55 – 14.10 Expected dividends 0 % Expected volatility 223.15 – 242.98 % Risk free interest rate 0.46 – 0.98 % Expected life of option 5 - 7 years The following is a summary of the Company’s stock option activity: Options Weighted Weighted Balance – December 31, 2020 – outstanding 541,021 12.75 4.29 Granted 1,812,375 6.39 6.22 Exercised - - - Cancelled/Modified (3,334 ) 15.00 - Balance – March 31, 2021 – outstanding 2,350,062 7.84 5.37 Balance – March 31, 2021 – exercisable 145,834 $ 23.97 1.55 Option Outstanding Option Exercisable Exercise price Number Outstanding Weighted Weighted Number Exercisable Weighted $ 7.84 2,350,062 5.37 23.97 145,834 1.55 During the ended December 31, 2018 the Company granted options of 11,667 to consultants that has a fair value of $57,123. As of the date of this filing the company has not issued these options and they are recorded as an accrued liability on the Consolidated Balance Sheet. Stock-based compensation for stock options has been recorded in the consolidated statements of operations and totaled $818,612, for the three months ended March 31, 2021. As of March 31, 2021, there was $7,807,672 of total unrecognized compensation expense related to unvested employee options granted under the Company’s share-based compensation plans that is expected to be recognized over a weighted average period of approximately 1.4 year. Warrants The Company applied fair value accounting for all share-based payments awards. The fair value of each warrant granted is estimated on the date of grant using the Black-Scholes option-pricing model. Warrant Activities The following is a summary of the Company’s warrant activity: Warrant Weighted Balance – December 31, 2020 – outstanding 6,130,948 4.96 Granted 486,516 5.13 Exercised (333,130 ) 4.69 Cancelled/Modified (10,556 ) 24.00 Balance – March 31, 2021 – outstanding 6,273,778 4.96 Balance – March 31, 2021 – exercisable 6,273,778 $ 4.96 Warrants Outstanding Warrants Exercisable Exercise price Number Weighted Weighted Number Weighted $ 4.96 6,273,778 4.52 4.96 6,273,778 4.52 During the three months ended March 31, 2021, the Company issued 302,404 shares of common stock to a certain warrant holder upon the exercise of a warrant to purchase 333,130 shares of common stock. The Company received $1,272,672 in connection with the exercise of a warrant. During the three months ended March 31, 2021 a total of 486,516 warrants were issued in connection with the Series E Convertible Preferred Stock raise. Share-based awards, restricted stock award (“RSAs”) On February 4, 2021 the Board resolved that, the Company shall pay each member of the Board, for each calendar quarter during which such member continues to serve on the Board, compensation as a group amounts to $62,500 per quarter. The shares vest one year after issuance. The $62,500 worth of Common Stock is based on the closing price on the last day of the quarter. Since the shares are based on a variable number of shares in a future period the Company classified this grant as a liability in accordance with ASC 480. A summary of the activity related to RSUs for the three months ended March 31, 2021is presented below: Restricted stock units (RSUs) Total shares Grant date RSAs non-vested at January 1, 2021 - $- RSAs granted 55,876 $ 4.30 – 4.32 RSAs vested - $ - RSAs forfeited - $ - RSAs non-vested March 31, 2021 55,876 $ 4.30 – 4.32 Stock-based compensation for RSA’s has been recorded in the consolidated statements of operations and totaled $228,535, for the three months ended March 31, 2021. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 10 – Commitments and Contingencies The CARES Act lifts certain deduction limitations originally imposed by the Tax Cuts and Jobs Act of 2017 (“2017 Tax Act”). Corporate taxpayers may carry back net operating losses (NOLs) originating between 2018 and 2020 for up to five years, which was not previously allowed under the 2017 Tax Act. The CARES Act also eliminates the 80% of taxable income limitations by allowing corporate entities to fully utilize NOL carryforwards to offset taxable income in 2018, 2019 or 2020. Taxpayers may generally deduct interest up to the sum of 50% of adjusted taxable income plus business interest income (30% limit under the 2017 Tax Act) for 2019 and 2020. The CARES Act allows taxpayers with alternative minimum tax credits to claim a refund in 2020 for the entire amount of the credits instead of recovering the credits through refunds over a period of years, as originally enacted by the 2017 Tax Act. In addition, the CARES Act raises the corporate charitable deduction limit to 25% of taxable income and makes qualified improvement property generally eligible for 15-year cost-recovery and 100% bonus depreciation. The enactment of the CARES Act did not result in any material adjustments to our income tax provision for the year ended December 31, 2020. On March 26, 2020 and April 30, 2020, the Company received 2 separate loans pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act. When the applications for PPP first opened up, there was limited available funding and much confusion surrounding the application process. The Company initially submitted its application for the May 2020 PPP Loan in early April but received no response in the aftermath of submitting the application. After consulting multiple advisors, the Company made the decision to apply elsewhere, due to the rampant media coverage of institutions running out of funding and the Company’s need for the capital and belief that if 2 separate loans were approved, the remaining application could simply be withdrawn. Therefore, in late April, the company proceeded with applying for the April 2020 PPP Loan. After some conflicting communications regarding acceptance, the Company attempted to contact the lender to clarify but got no response. After continued attempts to follow up with both lenders, the Company received approval for the May 2020 PPP Loan and funding for the April 2020 PPP Loan on the same day, followed the next day by the funding of the May 2020 PPP Loan. The Company immediately separated the funds for the April 2020 PPP Loan into a separate reserved bank account with the intention of returning the funds. However, after several attempts to contact the lender with no response, the Company was faced with difficulty raising funds in the early-Covid economy and made the decision to utilize the funds for operations and pursue an installment repayment plan when they were able to reach the lender. As of the date of this filing, the Company has begun making repayments on the loan, absent a formal installment agreement due to difficulties reaching the lender. The Company intends to complete repayment before the end of 2021. As each company is only permitted one loan under the CARES Act, there is a possibility the loan may be called by the SBA and the Company would have to repay the loan in full at such time. Litigation On or about June 25, 2020, Home Revolution, LLC (“Home Revolution”) filed a lawsuit in the United States District Court for the District of New Jersey, Home Revolution, LLC, et al et al We submitted an opposition, and after oral arguments on August 13, 2020, the Court denied the receiver request in its entirety. We then filed a Motion to Dismiss on August 14, 2020 on a number of grounds, the most significant of which is that this is a simple (alleged) breach of Promissory Note case. Creatd is current on all payments under the Note, and because both parties are New Jersey entities a mere breach of contract and/or collection-based case is not appropriately venued in federal court. Upon receipt of our Motion to Dismiss, Home Revolution submitted an Amended Complaint, presumably in an effort to cure the problems with the Complaint which we identified in the Motion to Dismiss. Home Revolution has subsequently initiated a series of atypical procedures and, as a result, has (without following the Federal Rules of Civil Procedure) moved for both default and to submit yet another newly Amended Complaint (the one precludes the other and vice versa). After we submitted a motion to clear up the above, the Court reinstated the matter to the docket and permitted Plaintiff to file the Second Amended Complaint (we had no objection). We have filed a motion to dismiss the Second Amended Complaint. That will take some time to be decided. We expect no major event to occur for the next 12 months. Finally, we believe the lawsuit lacks merit and will vigorously challenge the action. Lease Agreements On May 5, 2018, the Company signed a 5-year lease for approximately 2,300 square feet of office space at 2050 Center Avenue Suite 640, Fort Lee, New Jersey 07024. Commencement date of the lease is June 1, 2018. The total amount due under this lease is $411,150. On April 1, 2019, the Company signed a 4-year lease for approximately 796 square feet of office space at 2050 Center Avenue Suite 660, Fort Lee, New Jersey 07024. Commencement date of the lease is April 1, 2019. The total amount due under this lease is $108,229. The components of lease expense were as follows: Three Months Ended Operating lease cost $ 19,709 Short term lease cost 3,714 Total net lease cost $ 23,423 Supplemental cash flow and other information related to leases was as follows: Three Months Ended Cash paid for amounts included in the measurement of lease liabilities: Operating lease payments 26,646 Weighted average remaining lease term (in years): 2.2 Weighted average discount rate: 13 % Total future minimum payments required under the lease as of December 31, 2020 are as follows: Twelve Months Ending December 31, 2021 $ 82,336 2022 114,627 2023 53,094 Total $ 250,058 Rent expense for the three months ended March 31, 2021 and 2020 was $26,934.30 and $21,358, respectively. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 11 – Subsequent Events On May 13, 2021, one of the Company’s vendors issued a credit memo crediting $399,050 for Q1 2021 services. Subsequent to March 31, 2021, the Company entered into one promissory note agreement with net proceeds of $115,000, and subsequently repaid $28,403 towards the note. Subsequent to March 31, 2021, the Company entered into convertible promissory notes with three investors for aggregate net proceeds of $3,860,000. The Company issued an aggregate of 1,090,908 warrants with an exercise price of $4.50. Subsequent to March 31, 2021, a lender converted $169,400 in outstanding debt into 55,631 shares of Common Stock. Subsequent to March 31, 2021, a total of 43,084 warrants were exercised via cashless exercise, resulting in the cancellation of 43,084 warrants, and the issuance of 18,259 shares of Common Stock. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company’s condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and following the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These interim financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or any other interim period or for any other future year. These unaudited condensed financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2020, included in the Company’s 2020 Annual Report on Form 10-K filed with the SEC. The balance sheet as of December 31, 2020 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. |
Use of Estimates and Critical Accounting Estimates and Assumptions | Use of Estimates and Critical Accounting Estimates and Assumptions The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. |
Principles of consolidation | Principles of consolidation The Company consolidates all majority-owned subsidiaries, if any, in which the parent’s power to control exists. As of March 31, 2021, the Company’s consolidated subsidiaries and/or entities are as follows: Name of combined affiliate State or other jurisdiction of incorporation or organization Company Ownership Interest Jerrick Ventures LLC Delaware 100 % Abacus Tech Pty Ltd Australia 100 % Seller’s Choice, LLC New Jersey 100 % Jerrick Global, LLC Delaware 100 % Give, LLC Delaware 100 % Creatd Partners LLC Delaware 100 % Sci-Fi Shop, LLC Delaware 100 % OG Collection LLC Delaware 100 % VMENA LLC Delaware 100 % Vocal For Brands, LLC Delaware 100 % Vocal Ventures LLC Delaware 100 % What to Buy, LLC Delaware 100 % All inter-company balances and transactions have been eliminated. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value measurement disclosures are grouped into three levels based on valuation factors: ● Level 1 – quoted prices in active markets for identical investments ● Level 2 – other significant observable inputs (including quoted prices for similar investments and market corroborated inputs) ● Level 3 – significant unobservable inputs (including our own assumptions in determining the fair value of investments) The Company’s Level 1 assets/liabilities include cash, accounts receivable, marketable trading securities, accounts payable, prepaid and other current assets, line of credit and due to related parties. Management believes the estimated fair value of these accounts at March 31, 2021 approximate their carrying value as reflected in the balance sheets due to the short-term nature of these instruments or the use of market interest rates for debt instruments. The Company’s Level 2 assets/liabilities include certain of the Company’s notes payable and capital lease obligations. Their carrying value approximates their fair values based upon a comparison of the interest rate and terms of such debt given the level of risk to the rates and terms of similar debt currently available to the Company in the marketplace. The Company’s Level 3 assets/liabilities include goodwill, intangible assets, marketable debt securities, equity investments at cost, and derivative liabilities, when they are recorded at fair value due to an impairment charge. Inputs to determine fair value are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models. Unobservable inputs used in the models are significant to the fair values of the assets and liabilities. The following table provides a summary of the relevant assets and liabilities that are measured at fair value on recurring basis: Fair Value Measurements as of March 31, 2021 Total Quoted Prices in Active Markets for Identical Assets or Liabilities Quoted Prices for Similar Assets or Liabilities Significant Unobservable Assets: Marketable securities - debt securities $ 62,733 $ - $ - $ 62,733 Total assets $ 62,733 $ - $ - $ 62,733 Liabilities: Derivative liabilities $ 344,404 $ - $ - $ 344,404 Total Liabilities 344,404 $ - $ - $ 344,404 The following table shows the valuation methodology and unobservable inputs for Level 3 assets and liabilities measured at fair value on recurring basis as of March 31, 2021: Fair Value Valuation Methodology Unobservable Inputs Marketable securities - debt securities $ 62,733 Discounted cash flow analysis Expected cash flows from the investment Derivative liabilities $ 344,404 Monte Carlo simulations and Binomial model Risk free rate Expected volatility Drift rate The following table provides a summary of the relevant assets that are measured at fair value on non-recurring basis: Fair Value Measurements as of March 31, 2021 Total Quoted Prices in Active Markets for Identical Assets or Liabilities Quoted Prices for Similar Assets or Liabilities Significant Unobservable Inputs Assets: Equity investments, at cost $ 317,096 $ - $ - $ 317,096 Total assets $ 317,096 $ - $ - $ 317,096 The following table shows the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on non-recurring basis as of March 31, 2021: Fair Value Valuation Methodology Unobservable Inputs Equity investments, at cost $ 317,096 Qualitative assessment per ASC 321-10-35 Qualitative factors The Company valued the initial value of debt securities, which are investments in convertible notes receivable, by assessing the separate values of the debt and equity components for similar instruments convertible into private company equity (Level 3). The investment was initially measured at cost, which was determined to approximate fair value due to the lack of marketability of the conversion shares underlying these convertible instruments and the expected recoverability of the note principal. The key assumption affecting the level 3 fair values would be collectability of the notes. The Company monitors for impairment indicators at each balance sheet date. Marketable debt securities as of March 31, 2021 are as follows: Fair Value Cost Unrealized Gains Fair Value Marketable securities - debt securities 3 $ 62,733 $ - $ 62,733 The change in net unrealized holding gain (loss) on debt securities available for sale that has been included in Accumulated Other Comprehensive Income as a separate component of Stockholder’s Equity for the three months ended March 31, 2021 and 2020 was $0 and $0, respectively. The Company recognizes impairment on loans or notes receivable (that do not meet the definition of a debt security) when it is probable that it will be unable to collect all amounts due according to the contractual terms, and the amount of loss can be estimated. The loss is estimated based on the present value of expected cash flows. During the three months ended March 31, 2021 the Company recognized a $0 credit loss on debt marketable securities. |
Cash Equivalents | Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. At times, cash balances may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurable limits. The Company has never experienced any losses related to these balances. As of March 31, 2021, and December 31, 2020, cash amounts in excess of $250,000 were not fully insured. The uninsured cash balance as of March 31, 2021 was approximately $2.6 million. The Company does not believe it is exposed to significant credit risk on cash and cash equivalents. |
Long-lived Assets Including Goodwill and Other Acquired Intangibles Assets | Long-lived Assets Including Goodwill and Other Acquired Intangibles Assets We evaluate the recoverability of property and equipment and acquired finite-lived intangible assets for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. The evaluation is performed at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability of these assets is measured by a comparison of the carrying amounts to the future undiscounted cash flows the assets are expected to generate from the use and eventual disposition. If such review indicates that the carrying amount of property and equipment and intangible assets is not recoverable, the carrying amount of such assets is reduced to fair value. We have not recorded any significant impairment charges during the three months ended March 31, 2021. Acquired finite-lived intangible assets are amortized on a straight-line basis over the estimated useful lives of the assets. We routinely review the remaining estimated useful lives of property and equipment and finite-lived intangible assets. If we change the estimated useful life assumption for any asset, the remaining unamortized balance is amortized or depreciated over the revised estimated useful life. During the year ended December 31, 2020 the Company completed its annual impairment test of goodwill. The Company performed the qualitative assessment as permitted by ASC 350-20 and determined that the fair value of the reporting unit was more likely than not equal or greater than the carrying value, including Goodwill. Based on completion of this annual impairment test, no impairment was indicated. |
Investments | Investments Marketable securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and are reported at fair value, with unrealized gains and losses recognized in earnings. Debt securities not classified as held-to-maturity or as trading are classified as available-for-sale, and are carried at fair market value, with the unrealized gains and losses, net of tax, included in the determination of comprehensive income and reported in stockholders’ equity. The Company accounts for its investments in available-for-sale debt securities, in accordance with sub-topic 320-10 of the FASB ASC (“Sub-Topic 320-10”). Accrued interest on these securities is included in fair value and amortized cost. Pursuant to Paragraph 320-10-35, investments in debt securities that are classified as available for sale shall be measured subsequently at fair value in the statement of financial position. Unrealized holding gains and losses for available-for-sale securities (including those classified as current assets) shall be excluded from earnings and reported in other comprehensive income until realized. The Company follows FASB ASC 320-10-35 to assess whether an investment in debt securities is impaired in each reporting period. An investment in debt securities is impaired if the fair value of the investment is less than its amortized cost. If the Company intends to sell the debt security (that is, it has decided to sell the security), an other-than-temporary impairment shall be considered to have occurred. If the Company more likely than not will be required to sell the security before recovery of its amortized cost basis or it otherwise does not expect to recover the entire amortized cost basis of the security, an other-than-temporary impairment shall be considered to have occurred. The Company considers the expected cash flows from the investment based on reasonable and supportable forecasts as well as several other factors to estimate whether a credit loss exists. If the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, the other-than-temporary impairment shall be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. The following table sets forth a summary of the changes in marketable securities - available-for-sale debt securities that are measured at fair value on a recurring basis: For the Total Beginning of period $ 62,733 Purchase of marketable securities - Interest due at maturity - Other than temporary impairment - Conversion of marketable securities - March 31, 2021 $ 62,733 We invest in debt securities. Our investments in debt securities are subject to interest rate risk. To minimize the exposure due to an adverse shift in interest rates, we invest in securities with maturities of two years or less and maintain a weighted average maturity of one year or less. As of March 31, 2021, all of our investments had maturities between one and three years. The marketable debt security investments are evaluated for impairment if events or circumstances arise that indicate that the carrying amount of such assets may not be recoverable. The following table sets forth a summary of the changes in equity investments, at cost that are measured at fair value on a non-recurring basis: For the Total Beginning of period $ 217,096 Purchase of equity investments 100,000 Conversion of marketable securities - March 31, 2021 $ 317,096 The Company has elected to measure its equity securities without a readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. An election to measure an equity security in accordance with this paragraph shall be made for each investment separately. The Company performed a qualitative assessment considering impairment indicators to evaluate whether these investments were impaired. Impairment indicators that the Company considered included the following: a) a significant deterioration in the earnings performance, credit rating, asset quality or business prospects of the investee; b) a significant adverse change in the regulatory, economic or technology environment of the investee; c) a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates; d) a bona fide offer to purchase or an offer by the investee to sell the investment; e) factors that raise significant concerns about the investee’s ability to continue as a going concern. |
Commitments and Contingencies | Commitments and Contingencies The Company follows subtopic 450-20 of the FASB ASC to report accounting for contingencies. Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. |
Foreign Currency | Foreign Currency Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at our Consolidated Balance Sheet dates. Results of operations and cash flows are translated using the average exchange rates throughout the periods. The effect of exchange rate fluctuations on the translation of assets and liabilities is included as a component of stockholders’ equity in accumulated other comprehensive income. Gains and losses from foreign currency transactions, which are included in SG&A, have not been significant in any period presented. |
Derivative Liability | Derivative Liability The Company evaluates its debt and equity issuances to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 815-10-05-4 and Section 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation and then the related fair value is reclassified to equity. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date. The Company adopted Section 815-40-15 of the FASB Accounting Standards Codification (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The Company changed its method of accounting for the debt and warrants through the early adoption of ASU 2017-11 during the three months ended December 31, 2017 on a retrospective basis. The Company utilizes a Geometric Brownian Motion (“GBM”) model and a Binomial model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The inputs utilized in the application of the GBM model included a starting stock price, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, and a risk-free rate. The inputs utilized in the application of the Binomial model included a stock price on valuation date, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, and a risk-free rate. The Company records the change in the fair value of the derivative as other income or expense in the consolidated statements of operations. |
Revenue Recognition | Revenue Recognition Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. We determine revenue recognition through the following steps: ● identification of the contract, or contracts, with a customer; ● identification of the performance obligations in the contract; ● determination of the transaction price. The transaction price for any given subscriber could decrease based on any payments made to that subscriber. A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mille basis) and cash prizes offered to Challenge winners; ● allocation of the transaction price to the performance obligations in the contract; and ● recognition of revenue when, or as, we satisfy a performance obligation. Revenue disaggregated by revenue source for the three months ended March 31, 2021 and 2020 consists of the following: Three Months Ended 2021 2020 Agency (Managed Services + Branded Content) $ 428,300 $ 248,251 Platform (Creator Subscriptions) 306,902 35,962 Affiliate Sales 8,008 8,149 Other Revenue 703 780 $ 743,913 $ 293,142 Agency Revenue Managed Services The Company provides Studio/Agency Service offerings to business-to-business (B2B) and business-to-consumer (B2C) product and service brands which encompasses a full range of digital marketing and e-commerce solutions. The Company’s services include the setup and ongoing management of clients’ websites, Amazon and Shopify storefronts and listings, social media pages, search engine marketing, and other various tools and sales channels utilized by e-commerce sellers for sales and growth optimization. Contracts are broken into three categories Partners, Monthly Services, and Projects. Contract amounts for Partner and Monthly Services clients range from approximately $500-$7,500 per month while Project amounts vary depending on the scope of work. Partner and Monthly clients are billed monthly for the work completed within that month. Partner Clients may or may not have an additional billing component referred to as Sales Performance Fee, which is a fee based upon a previously agreed upon percentage point of the client’s total sales for the month. Some Partners may also have projects within their contracts that get billed and recognized as agreed upon project milestones are achieved. Revenue is recognized over time as service obligations and milestones in the contract are met. Branded Content Branded content represents the revenue recognized from the Company’s obligation to create and publish branded articles for clients on the Vocal platform and promote said stories, tracking engagement for the client. The performance obligation is satisfied when the Company successfully publishes the articles on its platform and meets any required promotional milestones as per the contract. The revenue is recognized over time as the services are performed and any required milestones are met. Below are the significant components of a typical agreement pertaining to branded content revenue: ● The Company collects fixed fees ranging from $10,000 to $110,000. ● The articles are created and published within three months of the signed agreement, or as previously negotiated with the client. ● The articles are promoted per the contract and engagement reports are provided to the client. ● Most billing for contracts occurs 50% at signing and 50% upon completion of the services, with net payment terms varying per client. ● Most contracts include provisions for clients to acquire content rights at the end of the campaign for a flat fee. Platform Revenue Creator Subscriptions Vocal+ is a premium subscription offering for Vocal creators. In addition to joining for free, Vocal creators now have the option to sign up for a Vocal+ membership for either $9.99 monthly or $99 annually, though these amounts are occasionally subject to promotional discounts. Vocal+ subscribers receive access to value-added features such as increased rate of cost per mille (thousand) (“CPM”) monetization, a decreased minimum withdrawal threshold, a discount on platform processing fees, member badges for their profiles, access to exclusive Vocal+ Challenges, and early access to new Vocal features. Subscription revenues stem from both monthly and annual subscriptions, the latter of which is amortized over a twelve-month period. Any customer payments received are recognized over the subscription period, with any payments received in advance being deferred until they are earned. The transaction price for any given subscriber could decrease based on any payments made to that subscriber. A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mille basis) and cash prizes offered to Challenge winners. Estimates are utilized for payments made for earnings through reads, by establishing the lifetime a subscriber has had a Vocal account, determining the percentage of that lifetime that the subscriber has been a paying customer, and applying that percentage to payments for earnings through reads in the relevant reporting period. Affiliate Sales Revenue Affiliate sales represents the commission the Company receives when a purchase is made through affiliate links placed within content hosted on the Vocal platform. Affiliate revenue is earned on a “click through” basis, upon referring visitors, via said links, to an affiliate’s site and having them complete a specific outcome, most commonly a product purchase. The Company uses multiple affiliate platforms, such as Skimlinks, Amazon, and Tune, to form and maintain thousands of vendor relationships. Each vendor establishes their own commission percentage, which typically range from 2-20%. The revenue is recognized upon receipt as reliable estimates could not be made. |
Deferred Revenue | Deferred Revenue Deferred revenue consists of billings and payments from clients in advance of revenue recognition. As of March 31, 2021 and December 31, 2020, the Company had deferred revenue of $148,760 and $88,637, respectively. |
Accounts Receivable and Allowances | Accounts Receivable and Allowances Accounts receivable are recorded and carried when the Company has performed the work in accordance with managed services, project, partner, consulting and branded content agreements. For example, we bill a managed service client monthly when we have updated their Amazon store, modified SEO or completed the other services listed in the agreement. For projects and branded content, we will bill the client and record the receivable once milestones are reached that are set in the agreement. We make estimates for the allowance for doubtful accounts and allowance for unbilled receivables based upon our assessment of various factors, including historical experience, the age of the accounts receivable balances, credit quality of our customers, current economic conditions, and other factors that may affect our ability to collect from customers. During the three months ended March 31, 2021 the Company recorded $997 as a bad debt expense. As of March 31, 2021 and December 31, 2020, the Company has an allowance for doubtful accounts of $81,506 and $80,509, respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes compensation expense for all equity–based payments granted in accordance with Accounting Standards Codification (“ASC”) 718 “Compensation – Stock Compensation”. Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a five-year period (vesting on a straight–line basis). The fair value of a stock award is equal to the fair market value of a share of Company stock on the grant date. The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the value of the underlying share, the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is benchmarked against similar companies in a similar industry over the expected option life and other appropriate factors. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on its Common stock and does not intend to pay dividends on its Common stock in the foreseeable future. The expected forfeiture rate is estimated based on management’s best estimate. Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, our equity–based compensation could be materially different in the future. The Company issues awards of equity instruments, such as stock options and restricted stock units, to employees and certain non-employee directors. Compensation expense related to these awards is based on the fair value of the underlying stock on the award date and is amortized over the service period, defined as the vesting period, using the cliff straight-line method. The vesting period is generally one to three years. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant is used for restricted stock units. Compensation expense is reduced for actual forfeitures as they occur. |
Loss Per Share | Loss Per Share Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case for the three months ended March 31, 2021 and 2020 presented in these condensed consolidated financial statements, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. The Company had the following common stock equivalents at March 31, 2021 and 2020: March 31, 2021 2020 Options 2,350,062 303,833 Warrants 6,273,778 268,660 Convertible notes - related party - 1,855 Convertible notes 49,629 430,084 Totals 8,673,469 1,004,432 |
Recently Adopted Accounting Guidance | Recently Adopted Accounting Guidance In December 2019, the FASB issued authoritative guidance intended to simplify the accounting for income taxes (ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”). This guidance eliminates certain exceptions to the general approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes. This guidance is effective for annual periods after December 15, 2020, including interim periods within those annual periods. The updated guidance, which became effective for fiscal years beginning after December 15, 2020, did not have a material impact on the Company’s condensed consolidated financial statements. |
Recent Accounting Guidance Not Yet Adopted | Recent Accounting Guidance Not Yet Adopted In In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU amends the guidance on convertible instruments and the derivatives scope exception for contracts in an entity’s own equity, and also improves and amends the related EPS guidance for both Subtopics. The ASU will be effective for annual reporting periods after December 15, 2021 and interim periods within those annual periods and early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements. In May 2021, the FASB issued authoritative guidance intended to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. (ASU 2021-04), “Derivatives and Hedging Contracts in Entity’s Own Equity (Topic 815). This guidance amendments provide measurement, recognition, and disclosure guidance for an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. This guidance is effective for annual periods after December 15, 2021, including interim periods within those annual periods. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements. Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying condensed consolidated financial statements. |
Significant Accounting Polici_2
Significant Accounting Policies and Practices (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of consolidated subsidiaries and/or entities | Name of combined affiliate State or other jurisdiction of incorporation or organization Company Ownership Interest Jerrick Ventures LLC Delaware 100 % Abacus Tech Pty Ltd Australia 100 % Seller’s Choice, LLC New Jersey 100 % Jerrick Global, LLC Delaware 100 % Give, LLC Delaware 100 % Creatd Partners LLC Delaware 100 % Sci-Fi Shop, LLC Delaware 100 % OG Collection LLC Delaware 100 % VMENA LLC Delaware 100 % Vocal For Brands, LLC Delaware 100 % Vocal Ventures LLC Delaware 100 % What to Buy, LLC Delaware 100 % |
Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis | Total Quoted Prices in Active Markets for Identical Assets or Liabilities Quoted Prices for Similar Assets or Liabilities Significant Unobservable Assets: Marketable securities - debt securities $ 62,733 $ - $ - $ 62,733 Total assets $ 62,733 $ - $ - $ 62,733 Liabilities: Derivative liabilities $ 344,404 $ - $ - $ 344,404 Total Liabilities 344,404 $ - $ - $ 344,404 Total Quoted Prices in Active Markets for Identical Assets or Liabilities Quoted Prices for Similar Assets or Liabilities Significant Unobservable Inputs Assets: Equity investments, at cost $ 317,096 $ - $ - $ 317,096 Total assets $ 317,096 $ - $ - $ 317,096 |
Schedule of fair value measurement inputs and valuation techniques | Fair Value Valuation Methodology Unobservable Inputs Marketable securities - debt securities $ 62,733 Discounted cash flow analysis Expected cash flows from the investment Derivative liabilities $ 344,404 Monte Carlo simulations and Binomial model Risk free rate Expected volatility Drift rate Fair Value Valuation Methodology Unobservable Inputs Equity investments, at cost $ 317,096 Qualitative assessment per ASC 321-10-35 Qualitative factors |
Schedule of marketable debt securities | Fair Value Cost Unrealized Gains Fair Value Marketable securities - debt securities 3 $ 62,733 $ - $ 62,733 |
Schedule of changes in marketable securities | For the Total Beginning of period $ 62,733 Purchase of marketable securities - Interest due at maturity - Other than temporary impairment - Conversion of marketable securities - March 31, 2021 $ 62,733 For the Total Beginning of period $ 217,096 Purchase of equity investments 100,000 Conversion of marketable securities - March 31, 2021 $ 317,096 |
Schedule of revenue disaggregated by revenue | Three Months Ended 2021 2020 Agency (Managed Services + Branded Content) $ 428,300 $ 248,251 Platform (Creator Subscriptions) 306,902 35,962 Affiliate Sales 8,008 8,149 Other Revenue 703 780 $ 743,913 $ 293,142 |
Schedule of common stock equivalents | March 31, 2021 2020 Options 2,350,062 303,833 Warrants 6,273,778 268,660 Convertible notes - related party - 1,855 Convertible notes 49,629 430,084 Totals 8,673,469 1,004,432 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of notes payable | Outstanding Principal as of March 31, December 31, Interest Maturity Seller’s Choice Note $ 660,000 $ 660,000 30 % September 2020 The May 2020 PPP Loan Agreement 412,500 412,500 1 % April 2022 The April 2020 PPP Loan Agreement 262,432 282,432 1 % May 2022 The October 2020 Loan Agreement 57,273 55,928 14 % July 21 The November 2020 Loan Agreement - 23,716 14 % May 2021 The February 2021 Loan Agreement 86,089 - 14 % July 21 1,478,293 1,434,576 Less: Debt Discount - - Less: Debt Issuance Costs - - 1,478,293 1,434,576 Less: Current Debt (1,423,995 ) (1,221,539 ) Total Long-Term Debt $ 54,298 $ 213,037 |
Scheduled principal payments due on notes payable | Twelve months ended March 31, 2021 $ 1,423,995 2022 54,298 $ 1,478,293 |
Convertible Note Payable (Table
Convertible Note Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Convertible Note Payable [Abstract] | |
Schedule of convertible notes payable | Outstanding Principal as of Warrants granted March 31, December 31, Interest Conversion Maturity Quantity Exercise The September 2020 convertible Loan Agreement - 341,880 12 % $ - (*) September 2021 85,555 5 The October 2020 convertible Loan Agreement 169,400 169,400 6 % $ - (*) October 2021 - - The First December 2020 convertible Loan Agreement - 600,000 12 % $ - (*) December 2021 - - The Second December 2020 convertible Loan Agreement 169,400 169,400 6 % $ - (*) December 2021 - - 338,800 1,280,680 Less: Debt Discount (94,226 ) (309,637 ) Less: Debt Issuance Costs (5,030 ) (73,527 ) 239,544 897,516 Less: Current Debt (239,544 ) (897,516 ) Total Long-Term Debt $ - $ - |
Related Party (Tables)
Related Party (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Schedule of convertible notes payable - related party | Outstanding Principal as of Warrants granted March 31, December 31, Interest Maturity Quantity Exercise The September 2020 Goldberg Loan Agreement 16,705 16,705 7 % September 2022 - - The September 2020 Rosen Loan Agreement 3,295 3,295 7 % September 2022 - - 20,000 20,000 Less: Debt Discount (14,603 ) (17,068 ) Less: Debt Issuance Costs - - 5,397 2,932 Less: Current Debt (5,397 ) (2,932 ) $ - $ - |
Derivative Liabilities (Tables)
Derivative Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of changes in the derivative liabilities | Three Months Ended March 31, Level 1 Level 2 Level 3 Derivative liabilities as January 1, 2021 $ - $ - $ 42,231 Addition - - 308,362 Extinguishment (203,578 ) Changes in fair value - - 197,389 Derivative liabilities as March 31, 2021 $ - $ - $ 344,404 |
Stockholders_ Equity (Tables)
Stockholders’ Equity (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Stockholders’ Equity (Tables) [Line Items] | |
Schedule of assumptions options granted | March 31, Exercise price $ 2.55 – 14.10 Expected dividends 0 % Expected volatility 223.15 – 242.98 % Risk free interest rate 0.46 – 0.98 % Expected life of option 5 - 7 years |
Schedule of warrant activity | Options Weighted Weighted Balance – December 31, 2020 – outstanding 541,021 12.75 4.29 Granted 1,812,375 6.39 6.22 Exercised - - - Cancelled/Modified (3,334 ) 15.00 - Balance – March 31, 2021 – outstanding 2,350,062 7.84 5.37 Balance – March 31, 2021 – exercisable 145,834 $ 23.97 1.55 |
Schedule of outstanding and exercisable | Option Outstanding Option Exercisable Exercise price Number Outstanding Weighted Weighted Number Exercisable Weighted $ 7.84 2,350,062 5.37 23.97 145,834 1.55 |
Schedule of outstanding and exercisable | Warrants Outstanding Warrants Exercisable Exercise price Number Weighted Weighted Number Weighted $ 4.96 6,273,778 4.52 4.96 6,273,778 4.52 |
Schedule of activity related to RSUs | Restricted stock units (RSUs) Total shares Grant date RSAs non-vested at January 1, 2021 - $- RSAs granted 55,876 $ 4.30 – 4.32 RSAs vested - $ - RSAs forfeited - $ - RSAs non-vested March 31, 2021 55,876 $ 4.30 – 4.32 |
Warrant [Member] | |
Stockholders’ Equity (Tables) [Line Items] | |
Schedule of warrant activity | Warrant Weighted Balance – December 31, 2020 – outstanding 6,130,948 4.96 Granted 486,516 5.13 Exercised (333,130 ) 4.69 Cancelled/Modified (10,556 ) 24.00 Balance – March 31, 2021 – outstanding 6,273,778 4.96 Balance – March 31, 2021 – exercisable 6,273,778 $ 4.96 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of components of lease expense | Three Months Ended Operating lease cost $ 19,709 Short term lease cost 3,714 Total net lease cost $ 23,423 |
Schedule supplemental cash flow and other information related to leases | Three Months Ended Cash paid for amounts included in the measurement of lease liabilities: Operating lease payments 26,646 Weighted average remaining lease term (in years): 2.2 Weighted average discount rate: 13 % |
Schedule of future minimum payments required under the lease | Twelve Months Ending December 31, 2021 $ 82,336 2022 114,627 2023 53,094 Total $ 250,058 |
Organization and Operations (De
Organization and Operations (Details) - shares | Feb. 05, 2016 | Sep. 11, 2019 |
Organization and Operations (Details) [Line Items] | ||
Acquired percentage | 100.00% | |
Great Plains Holdings Inc [Member] | ||
Organization and Operations (Details) [Line Items] | ||
Issuance of common shares for cash | 475,000 | |
Kent Campbell [Member] | ||
Organization and Operations (Details) [Line Items] | ||
Cancelled of common stock | 39,091 | |
Series A Preferred Stock [Member] | ||
Organization and Operations (Details) [Line Items] | ||
Issuance of common shares for cash | 33,415 | |
Series B Preferred Stock [Member] | ||
Organization and Operations (Details) [Line Items] | ||
Issuance of common shares for cash | 8,064 |
Significant Accounting Polici_3
Significant Accounting Policies and Practices (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Significant Accounting Policies and Practices (Details) [Line Items] | |||
Other Expenses | $ 0 | $ 0 | |
Marketable equity securities | 0 | ||
Cash excess amounts | 250,000 | ||
Uninsured cash balance | $ 2,600,000 | ||
Description of investments | Our investments in debt securities are subject to interest rate risk. To minimize the exposure due to an adverse shift in interest rates, we invest in securities with maturities of two years or less and maintain a weighted average maturity of one year or less. | ||
Managed services, description | Contracts are broken into three categories Partners, Monthly Services, and Projects. | ||
Deferred revenue | $ 148,760 | $ 88,637 | |
Bad debt expense | 997 | ||
Allowance for doubtful accounts | $ 81,506 | $ 80,509 | |
Minimum [Member] | |||
Significant Accounting Policies and Practices (Details) [Line Items] | |||
Affiliate sales percentage | 2.00% | ||
Maximum [Member] | |||
Significant Accounting Policies and Practices (Details) [Line Items] | |||
Affiliate sales percentage | 20.00% | ||
Subscription Arrangement [Member] | |||
Significant Accounting Policies and Practices (Details) [Line Items] | |||
Payment related percentage, description | Vocal+ is a premium subscription offering for Vocal creators. In addition to joining for free, Vocal creators now have the option to sign up for a Vocal+ membership for either $9.99 monthly or $99 annually, though these amounts are occasionally subject to promotional discounts. Vocal+ subscribers receive access to value-added features such as increased rate of cost per mille (thousand) (“CPM”) monetization, a decreased minimum withdrawal threshold, a discount on platform processing fees, member badges for their profiles, access to exclusive Vocal+ Challenges, and early access to new Vocal features. Subscription revenues stem from both monthly and annual subscriptions, the latter of which is amortized over a twelve-month period. Any customer payments received are recognized over the subscription period, with any payments received in advance being deferred until they are earned. |
Significant Accounting Polici_4
Significant Accounting Policies and Practices (Details) - Schedule of consolidated subsidiaries and/or entities | 3 Months Ended |
Mar. 31, 2021 | |
Jerrick Ventures LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
Abacus Tech Pty Ltd [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Australia |
State or other jurisdiction of incorporation or organization | 100% |
Seller's Choice [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | New Jersey |
State or other jurisdiction of incorporation or organization | 100% |
Jerrick Global, LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
Give, LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
Creatd Partners LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
Sci-Fi Shop, LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
OG Collection LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
VMENA LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
Vocal For Brands, LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
Vocal Ventures LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
What to Buy, LLC [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Name of combined affiliate | Delaware |
State or other jurisdiction of incorporation or organization | 100% |
Significant Accounting Polici_5
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis | Mar. 31, 2021USD ($) |
Fair value on recurring basis [Member] | |
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items] | |
Marketable securities - debt securities | $ 62,733 |
Total assets | 62,733 |
Derivative liabilities | 344,404 |
Total Liabilities | 344,404 |
Fair value on non-recurring basis [Member] | |
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items] | |
Total assets | 317,096 |
Equity investments, at cost | 317,096 |
Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) [Member] | Fair value on recurring basis [Member] | |
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items] | |
Marketable securities - debt securities | |
Total assets | |
Derivative liabilities | |
Total Liabilities | |
Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) [Member] | Fair value on non-recurring basis [Member] | |
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items] | |
Total assets | |
Equity investments, at cost | |
Quoted Prices for Similar Assets or Liabilities in Active Markets (Level 2) [Member] | Fair value on recurring basis [Member] | |
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items] | |
Marketable securities - debt securities | |
Total assets | |
Derivative liabilities | |
Total Liabilities | |
Quoted Prices for Similar Assets or Liabilities in Active Markets (Level 2) [Member] | Fair value on non-recurring basis [Member] | |
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items] | |
Total assets | |
Equity investments, at cost | |
Significant Unobservable Inputs (Level 3) [Member] | Fair value on recurring basis [Member] | |
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items] | |
Marketable securities - debt securities | 62,733 |
Total assets | 62,733 |
Derivative liabilities | 344,404 |
Total Liabilities | 344,404 |
Significant Unobservable Inputs (Level 3) [Member] | Fair value on non-recurring basis [Member] | |
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items] | |
Total assets | 317,096 |
Equity investments, at cost | $ 317,096 |
Significant Accounting Polici_6
Significant Accounting Policies and Practices (Details) - Schedule of fair value measurement inputs and valuation techniques | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Marketable securities - debt securities [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Fair Value | $ 62,733 |
Valuation Methodology | Discounted cash flow analysis |
Unobservable Inputs | Expected cash flows from the investment |
Derivative liabilities [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Fair Value | $ 344,404 |
Valuation Methodology | Monte Carlo simulations and Binomial model |
Unobservable Inputs | Risk free rate |
Derivative liabilitie One [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Unobservable Inputs | Expected volatility |
Derivative liabilities Two [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Unobservable Inputs | Drift rate |
Equity investments, at cost [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Fair Value | $ 317,096 |
Valuation Methodology | Qualitative assessment per ASC 321-10-35 |
Unobservable Inputs | Qualitative factors |
Significant Accounting Polici_7
Significant Accounting Policies and Practices (Details) - Schedule of marketable debt securities - Marketable debt securities [Member] | Mar. 31, 2021USD ($) |
Significant Accounting Policies and Practices (Details) - Schedule of marketable debt securities [Line Items] | |
Cost | $ 62,733 |
Unrealized Gains (Loss) | |
Fair Value | $ 62,733 |
Significant Accounting Polici_8
Significant Accounting Policies and Practices (Details) - Schedule of changes in marketable securities - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Significant Accounting Policies and Practices (Details) - Schedule of changes in marketable securities [Line Items] | ||
Beginning of period | $ 217,096 | |
Purchase of equity investments | 100,000 | |
Conversion of marketable securities | ||
March 31, 2021 | $ 317,096 | |
Marketable securities - debt securities [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of changes in marketable securities [Line Items] | ||
Beginning of period | $ 62,733 | |
Purchase of marketable securities | ||
Interest due at maturity | ||
Other than temporary impairment | ||
Conversion of marketable securities | ||
March 31, 2021 | $ 62,733 |
Significant Accounting Polici_9
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items] | ||
Net revenue | $ 743,913 | $ 293,142 |
Branded content [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items] | ||
Net revenue | 428,300 | 248,251 |
Creator Subscriptions [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items] | ||
Net revenue | 306,902 | 35,962 |
Affiliate Sales [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items] | ||
Net revenue | 8,008 | 8,149 |
Other revenue [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items] | ||
Net revenue | $ 703 | $ 780 |
Significant Accounting Polic_10
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents - shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items] | ||
Common stock equivalents, total | 8,673,469 | 1,004,432 |
Warrants [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items] | ||
Common stock equivalents, total | 6,273,778 | 268,660 |
Options [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items] | ||
Common stock equivalents, total | 2,350,062 | 303,833 |
Convertible notes - related party [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items] | ||
Common stock equivalents, total | 1,855 | |
Convertible Debt [Member] | ||
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items] | ||
Common stock equivalents, total | 49,629 | 430,084 |
Going Concern (Details)
Going Concern (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ 78,600,000 | |
Net loss | (6,643,237) | $ (2,838,498) |
Net cash used in operating activities | $ 5,300,000 |
Equity investments, at cost (De
Equity investments, at cost (Details) - USD ($) | Feb. 17, 2021 | Oct. 23, 2020 | Oct. 02, 2020 |
Investment Holdings [Abstract] | |||
Marketable debt security | $ 102,096 | ||
Converted into shares of preferred stock | 119,355 | ||
Equity investment ownership percentage | 3.30% | 3.80% | 1.30% |
Other Ownership Interests, Contributed Capital | $ 100,000 | $ 115,000 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |||||||
Feb. 24, 2021 | Oct. 06, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Nov. 24, 2020 | May 04, 2020 | Apr. 30, 2020 | Mar. 11, 2020 | Sep. 11, 2019 | |
Notes Payable (Details) [Line Items] | |||||||||
Accrued Interest | $ 57 | ||||||||
Accrued Interest | (6,643,237) | $ (2,985,997) | |||||||
Loan agreement, description | the Company entered into a secured loan agreement (the “October 2020 Loan Agreement”) with a lender (the “October 2020 Lender”), whereby the October 2020 Lender issued the Company a secured promissory note of A$74,300 AUD or $53,128 United States Dollars (the “October 2020 Note”). Pursuant to the October 2020 Loan Agreement, the October 2020 Note has an effective interest rate of 14%. The maturity date of the October 2020 Note is September 30, 2021 (the “October 2020 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the October 2020 Loan Agreement are due. The loan is secured by the Australian research & development credit | ||||||||
Accrued interest | $ 2,565 | 1,499 | |||||||
Secured loan agreement, description | (the “February 2021 Loan Agreement”) with a lender (the “February 2021 Lender”), whereby the February 2021 Lender issued the Company a secured promissory note of A$111,683 AUD or $86,089 United States Dollars (the “February 2021 Note”). Pursuant to the February 2021 Loan Agreement, the February 2021 Note has an effective interest rate of 14%. The maturity date of the February 2021 Note is July 31, 2021 (the “February 2021 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the February 2021 Loan Agreement are due. The loan is secured by the Australian research & development credit. | ||||||||
The September 2020 Loan Agreement [Member] | |||||||||
Notes Payable (Details) [Line Items] | |||||||||
Principal amount | $ 660,000 | ||||||||
Interest Rate | 9.50% | 5.00% | |||||||
Accrued Interest | 48,822 | ||||||||
The April 2020 PPP Loan Agreement [Member] | |||||||||
Notes Payable (Details) [Line Items] | |||||||||
Interest Rate | 1.00% | ||||||||
Principal amount | $ 282,432 | ||||||||
Accrued Interest | 696 | ||||||||
Principal payments | 20,000 | ||||||||
The May 2020 PPP Loan Agreement [Member] | |||||||||
Notes Payable (Details) [Line Items] | |||||||||
Interest Rate | 1.00% | ||||||||
Accrued Interest | 1,017 | ||||||||
Principal amount | $ 412,500 | ||||||||
The November 2020 Loan Agreement [Member] | |||||||||
Notes Payable (Details) [Line Items] | |||||||||
Interest Rate | 14.00% | ||||||||
Accrued Interest | 4,736 | ||||||||
Principal payments | $ 23,716 | ||||||||
Promissory note | $ 34,000 |
Notes Payable (Details) - Sched
Notes Payable (Details) - Schedule of notes payable - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | ||
Outstanding Principal,Total | $ 1,478,293 | $ 1,434,576 |
Outstanding Principal, Less: Debt Discount | ||
Outstanding Principal,Less: Debt Issuance Costs | ||
Outstanding Principal, Less: Debt Total | 1,478,293 | 1,434,576 |
Outstanding Principal, Less: Current Debt | (1,423,995) | (1,221,539) |
Outstanding Principal, Total Long-Term Debt | 54,298 | 213,037 |
The May 2020 PPP Loan Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal,Total | $ 412,500 | 412,500 |
Interest Rate | 1.00% | |
Maturity Date, descriptiom | April 2022 | |
The April 2020 PPP Loan Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal,Total | $ 262,432 | 282,432 |
Interest Rate | 1.00% | |
Maturity Date, descriptiom | May 2022 | |
The October 2020 Loan Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal,Total | $ 57,273 | 55,928 |
Interest Rate | 14.00% | |
Maturity Date, descriptiom | July 21 | |
The November 2020 Loan Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal,Total | 23,716 | |
Interest Rate | 14.00% | |
Maturity Date, descriptiom | May 2021 | |
The February 2021 Loan Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal,Total | $ 86,089 | |
Interest Rate | 14.00% | |
Maturity Date, descriptiom | July 21 | |
Seller’s Choice Note [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal,Total | $ 660,000 | $ 660,000 |
Interest Rate | 30.00% | |
Maturity Date, descriptiom | September 2020 |
Notes Payable (Details) - Sch_2
Notes Payable (Details) - Scheduled principal payments due on notes payable | Mar. 31, 2021USD ($) |
Scheduled principal payments due on notes payable [Abstract] | |
2021 | $ 1,423,995 |
2022 | 54,298 |
Total | $ 1,478,293 |
Convertible Note Payable (Detai
Convertible Note Payable (Details) - USD ($) | Dec. 09, 2020 | Oct. 02, 2020 | Jul. 02, 2020 | Jul. 01, 2020 | Dec. 30, 2020 | Sep. 23, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 15, 2020 | Aug. 31, 2020 |
Convertible Note Payable (Details) [Line Items] | ||||||||||
Note accrues interest rate | 7.00% | |||||||||
Derivative liability | $ 112,743 | |||||||||
Debt discount | 68,000 | |||||||||
Derivative liability | 44,743 | |||||||||
Principal amount of convertible notes | $ 68,000 | |||||||||
Repaid of interest | 3,400 | |||||||||
Debt Instrument, Unamortized Discount, Current | 94,226 | $ 309,637 | ||||||||
Debt issuance costs | ||||||||||
The First July 2020 convertible Loan Agreement [Member] | ||||||||||
Convertible Note Payable (Details) [Line Items] | ||||||||||
Principal amount of convertible notes (in Shares) | 68,000 | |||||||||
Note accrues interest rate | 10.00% | |||||||||
Interest and principal both due date | Jun. 29, 2021 | |||||||||
The October 2020 convertible Loan Agreement [Member] | ||||||||||
Convertible Note Payable (Details) [Line Items] | ||||||||||
Note accrues interest rate | 6.00% | |||||||||
Maturity date, description | Upon default or 180 days after issuance the First July 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to 61% multiplied by the lowest trade of the common stock during the twenty (15) consecutive trading day period immediately preceding the date of the respective conversion.t | |||||||||
Debt discount | $ 19,400 | |||||||||
Promissory note | $ 169,400 | |||||||||
Derivative liability | $ 74,860 | |||||||||
The August 2020 convertible Loan Agreement [Member] | ||||||||||
Convertible Note Payable (Details) [Line Items] | ||||||||||
Note accrues interest rate | 12.00% | |||||||||
Maturity date, description | Upon default or 180 days after issuance the August 2020 Convertible Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to 61% multiplied by the lowest trade of the common stock during the twenty (15) consecutive trading day period immediately preceding the date of the respective conversion. | |||||||||
Debt discount | $ 65,000 | |||||||||
Derivative liability | 55,759 | |||||||||
Repaid of interest | 3,400 | |||||||||
Common stock issued | 29,859 | |||||||||
Promissory note | $ 68,000 | |||||||||
Debt Instrument, Unamortized Discount, Current | 3,000 | |||||||||
Derivative liability | $ 120,759 | |||||||||
Converted principal amount | 68,000 | |||||||||
The September 2020 convertible Loan Agreement [Member] | ||||||||||
Convertible Note Payable (Details) [Line Items] | ||||||||||
Note accrues interest rate | 12.00% | |||||||||
Maturity date, description | Upon default or 180 days after issuance the Second July 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share equal to the closing bid price of the Company’s common stock on the trading day immediately preceding the date of the respective conversion. | |||||||||
Debt discount | 146,393 | |||||||||
Promissory note | $ 385,000 | |||||||||
Debt issuance costs | $ 68,255 | |||||||||
Warrants purchase of common stock (in Shares) | 85,555 | |||||||||
Repaid | $ 341,880 | |||||||||
Debt interest payable | 46,200 | |||||||||
The First December 2020 convertible Loan Agreement [Member] | ||||||||||
Convertible Note Payable (Details) [Line Items] | ||||||||||
Note accrues interest rate | 12.00% | |||||||||
Maturity date, description | Upon default the First December 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to the closing bid price of the Company’s common stock on the trading day immediately preceding the date of the respective conversion. | |||||||||
Debt discount | $ 113,481 | |||||||||
Promissory note | 600,000 | |||||||||
Debt issuance costs | $ 110,300 | |||||||||
Repaid | 600,000 | |||||||||
Debt interest payable | 4,340 | |||||||||
Issuance of warrants (in Shares) | 45,000 | |||||||||
The Second December 2020 convertible Loan Agreement [Member] | ||||||||||
Convertible Note Payable (Details) [Line Items] | ||||||||||
Note accrues interest rate | 6.00% | |||||||||
Maturity date, description | Upon default the Second December 2020 Note is convertible into shares of the Company’s common stock, par value $0.001 per share (“Conversion Shares”) equal to 75% of average the lowest three trading prices of the Company’s common stock on the fifteen-trading day immediately preceding the date of the respective conversion. | |||||||||
Debt discount | $ 18,900 | |||||||||
Promissory note | $ 169,400 | |||||||||
Convertible Common Stock [Member] | ||||||||||
Convertible Note Payable (Details) [Line Items] | ||||||||||
Common stock issued | $ 35,469 | |||||||||
Convertible Common Stock [Member] | The First December 2020 convertible Loan Agreement [Member] | ||||||||||
Convertible Note Payable (Details) [Line Items] | ||||||||||
Common stock issued | $ 45,000 |
Convertible Note Payable (Det_2
Convertible Note Payable (Details) - Schedule of convertible notes payable - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items] | ||
Outstanding Principal | $ 338,800 | $ 1,280,680 |
Less: Debt Discount | (94,226) | (309,637) |
Less: Debt Issuance Costs | (5,030) | (73,527) |
Total | 239,544 | 897,516 |
Less: Current Debt | (239,544) | (897,516) |
Total Long-Term Debt | ||
The September 2020 convertible Loan Agreement [Member] | ||
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items] | ||
Outstanding Principal | 341,880 | |
Interest Rate | 12.00% | |
Conversion Price (in Dollars per share) | ||
Maturity Date | September 2021 | |
Warrants granted, Quantity (in Shares) | 85,555 | |
Warrants granted, Exercise Price (in Shares) | 5 | |
The October 2020 convertible Loan Agreement [Member] | ||
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items] | ||
Outstanding Principal | $ 169,400 | 169,400 |
Interest Rate | 6.00% | |
Conversion Price (in Dollars per share) | ||
Maturity Date | October 2021 | |
The First December 2020 convertible Loan Agreement [Member] | ||
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items] | ||
Outstanding Principal | 600,000 | |
Interest Rate | 12.00% | |
Conversion Price (in Dollars per share) | ||
Maturity Date | December 2021 | |
The Second December 2020 convertible Loan Agreement [Member] | ||
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items] | ||
Outstanding Principal | $ 169,400 | $ 169,400 |
Interest Rate | 6.00% | |
Conversion Price (in Dollars per share) | ||
Maturity Date | December 2021 |
Related Party (Details)
Related Party (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |
Sep. 30, 2020 | Sep. 15, 2020 | Mar. 31, 2021 | |
Related Party (Details) [Line Items] | |||
Accrued interest | $ 57 | ||
Interest rate | 7.00% | ||
Living expenses | 20,082 | ||
The September 2020 Goldberg Loan Agreement [Member] | |||
Related Party (Details) [Line Items] | |||
Promissory note | $ 16,705 | ||
Interest rate | 7.00% | ||
Maturity date | The maturity date of the September 2020 Goldberg Note is September 15, 2022 (the “September 2020 Goldberg Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under note are due. | ||
Loan agreement, description | the Company’s common stock issued to the lender in accordance with the Lender’s Exchange Agreement (see note 11) have a value equal to or less than $7,737,594 determined by using the lowest VWAP of the last 30 days prior to September 14, 2021. The principal amount of the September 2020 Goldberg Note shall increase by 200% of the difference between the initial consideration and the September 14, 2021 value. | ||
Debt discount | $ 16,705 | ||
Accrued interest | $ 288 | ||
The September 2020 Goldberg Loan Agreement [Member] | Maximum [Member] | |||
Related Party (Details) [Line Items] | |||
Loss on extinguishment of debt | 2,557,275 | ||
The September 2020 Goldberg Loan Agreement [Member] | Minimum [Member] | |||
Related Party (Details) [Line Items] | |||
Loss on extinguishment of debt | 2,540,570 | ||
The September 2020 Rosen Loan Agreement [Member] | |||
Related Party (Details) [Line Items] | |||
Promissory note | $ 3,295 | ||
Loan agreement, description | the Company’s common stock issued to the lender in accordance with the Lender’s Exchange Agreement (see note 11) have a value equal to or less than $554,924 determined by using the lowest VWAP of the last 30 days prior to September 14, 2021. The principal amount of the September 2020 Rosen Note shall increase by 200% of the difference the initial consideration and the September 14, 2021 value. | ||
Debt discount | $ 3,295 | ||
The September 2020 Rosen Loan Agreement [Member] | Maximum [Member] | |||
Related Party (Details) [Line Items] | |||
Loss on extinguishment of debt | 504,413 | ||
The September 2020 Rosen Loan Agreement [Member] | Minimum [Member] | |||
Related Party (Details) [Line Items] | |||
Loss on extinguishment of debt | $ 501,118 |
Related Party (Details) - Sched
Related Party (Details) - Schedule of convertible notes payable - related party - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Related Party (Details) - Schedule of convertible notes payable - related party [Line Items] | ||
Notes payable - related party, gross | $ 20,000 | $ 20,000 |
Less: Debt Discount | (14,603) | (17,068) |
Less: Debt Issuance Costs | ||
Notes payable | 5,397 | 2,932 |
Less: Current Debt | (5,397) | (2,932) |
Notes payable - related party, net | ||
TheSeptemberTwoThousandTwentyGoldbergLoanAgreementMember | ||
Related Party (Details) - Schedule of convertible notes payable - related party [Line Items] | ||
Notes payable - related party, gross | $ 16,705 | 16,705 |
Interest Rate | 7.00% | |
Maturity Date | September 2022 | |
Warrants granted, Quantity (in Shares) | ||
Warrants granted, Exercise Price (in Dollars per share) | ||
The September 2020 Rosen Loan Agreement [Member] | ||
Related Party (Details) - Schedule of convertible notes payable - related party [Line Items] | ||
Notes payable - related party, gross | $ 3,295 | $ 3,295 |
Interest Rate | 7.00% | |
Maturity Date | September 2022 | |
Warrants granted, Quantity (in Shares) | ||
Warrants granted, Exercise Price (in Dollars per share) |
Derivative Liabilities (Details
Derivative Liabilities (Details) | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Expected dividend yield | 0.00% |
Derivative Liabilities (Detai_2
Derivative Liabilities (Details) - Schedule of changes in the derivative liabilities | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Level 1 [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Derivative liabilities as January 1, 2021 | |
Addition | |
Changes in fair value | |
Derivative liabilities as March 31, 2021 | |
Level 2 [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Derivative liabilities as January 1, 2021 | |
Addition | |
Changes in fair value | |
Derivative liabilities as March 31, 2021 | |
Level 3 [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Derivative liabilities as January 1, 2021 | 42,231 |
Addition | 308,362 |
Extinguishment Expense | (203,578) |
Changes in fair value | 197,389 |
Derivative liabilities as March 31, 2021 | $ 344,404 |
Stockholders_ Equity (Details)
Stockholders’ Equity (Details) - USD ($) | Feb. 04, 2021 | Dec. 29, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2018 | Mar. 28, 2021 | Mar. 17, 2021 | Feb. 26, 2021 | Feb. 18, 2021 | Feb. 03, 2021 | Feb. 01, 2021 | Jan. 20, 2021 | Jan. 14, 2021 | Jul. 13, 2020 |
Stockholders’ Equity (Details) [Line Items] | ||||||||||||||
Shares of capital stock | (35,000,000) | |||||||||||||
Designated of common stock shares | (15,000,000) | |||||||||||||
Common stock, par value (in Dollars per share) | $ 0.001 | |||||||||||||
Designated of preferred stock | (20,000,000) | |||||||||||||
Preferred stock, par value (in Dollars per share) | $ 0.001 | |||||||||||||
Issuance shares of common stock | 100,000,000 | |||||||||||||
Issuance of preferred stock | 20,000,000 | |||||||||||||
Exercise price (in Dollars per share) | $ 4.50 | |||||||||||||
Subscription receivable (in Dollars) | $ 40,000 | |||||||||||||
Issuance cost (in Dollars) | $ 4,225 | |||||||||||||
Restricted common stock | 13,113 | 31,782 | 9,624 | 291 | 10,000 | 1,929 | 50,000 | 40,000 | 30,000 | |||||
Fair value (in Dollars) | $ 43,667 | $ 57,123 | $ 125,000 | $ 49,371 | $ 1,499 | $ 48,000 | $ 8,198 | $ 196,000 | $ 192,000 | $ 133,200 | ||||
Share based payments (in Dollars) | 36,822 | |||||||||||||
Loss on settlement of vendors liabilities (in Dollars) | 12,719 | |||||||||||||
Grant options | 11,667 | |||||||||||||
Share based payments (in Dollars) | 1,570,239 | $ 392,143 | ||||||||||||
Unrecognized compensation expense, total (in Dollars) | $ 7,807,672 | |||||||||||||
Weighted average remaining life | 1 year 146 days | |||||||||||||
Issued common stock | 302,404 | |||||||||||||
Warrant to purchase of common stock | 333,130 | |||||||||||||
Received exercise of warrants (in Dollars) | $ 1,272,672 | |||||||||||||
Share-based awards, restricted stock award, description | the Company shall pay each member of the Board, for each calendar quarter during which such member continues to serve on the Board, compensation as a group amounts to $62,500 per quarter. The shares vest one year after issuance. The $62,500 worth of Common Stock is based on the closing price on the last day of the quarter. Since the shares are based on a variable number of shares in a future period the Company classified this grant as a liability in accordance with ASC 480. | |||||||||||||
Stock-based compensation for RSA’ amount (in Dollars) | 228,535 | |||||||||||||
Stock option [Member] | ||||||||||||||
Stockholders’ Equity (Details) [Line Items] | ||||||||||||||
Share based payments (in Dollars) | $ 818,612 | |||||||||||||
Common Stock [Member] | ||||||||||||||
Stockholders’ Equity (Details) [Line Items] | ||||||||||||||
Restricted common stock | 10,417 | |||||||||||||
Fair value (in Dollars) | $ 50,002 | |||||||||||||
Series E Convertible Preferred Stock [Member] | ||||||||||||||
Stockholders’ Equity (Details) [Line Items] | ||||||||||||||
Preferred stock, description | the Company entered into securities purchase agreements with thirty-three accredited investors whereby the Investors have agreed to purchase from the Company an aggregate of 7,778 shares of the Company’s Series E Convertible Preferred Stock, par value $0.001 per share and 2,831,715 warrants to purchase shares of the Company’s common stock, par value $0.001 per share. The Series E Preferred Stock is convertible into a total of 1,887,810 shares of Common Stock. The combined purchase price of one Conversion Share and one and a half warrant was $4.12. The aggregate purchase price for the Series E Preferred Stock and warrants was $7,777,777.77. The Company has recorded $817,353 to stock issuance costs, which are part of Additional Paid-in Capital. | |||||||||||||
Warrants, description | The placement agent for the transaction and received cash compensation equal to 10% of the aggregate purchase price and warrants to purchase 471,953 shares of the Company’s common stock, at an exercise price of $5.15 per share (the “PA Warrants”). The PA Warrants are exercisable for a term of five-years from the date of issuance. | |||||||||||||
Converted shares | 6,690 | |||||||||||||
Common stock shares | 1,623,730 | |||||||||||||
Warrants issued | 486,516 |
Stockholders_ Equity (Details)
Stockholders’ Equity (Details) - Schedule of assumptions options granted | 3 Months Ended |
Mar. 31, 2021$ / shares | |
Stockholders’ Equity (Details) - Schedule of assumptions options granted [Line Items] | |
Expected dividends | 0.00% |
Minimum [Member] | |
Stockholders’ Equity (Details) - Schedule of assumptions options granted [Line Items] | |
Exercise price (in Dollars per share) | $ 2.55 |
Expected volatility | 223.15% |
Risk free interest rate | 0.46% |
Expected life of option | 5 years |
Maximum [Member] | |
Stockholders’ Equity (Details) - Schedule of assumptions options granted [Line Items] | |
Exercise price (in Dollars per share) | $ 14.10 |
Expected volatility | 242.98% |
Risk free interest rate | 0.98% |
Expected life of option | 7 years |
Stockholders_ Equity (Details_2
Stockholders’ Equity (Details) - Schedule of the stock option activity - Stock Option [Member] | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Stockholders’ Equity (Details) - Schedule of the stock option activity [Line Items] | |
Options beginning balance | 541,021 |
Weighted Average Exercise Price beginning balance (in Dollars per share) | $ / shares | $ 12.75 |
Weighted Average Remaining Contractual Life (in years) beginning balance | 4 years 105 days |
Options Granted | 1,812,375 |
Weighted Average Exercise Price Granted | 6.39 |
Weighted Average Remaining Contractual Life (in years) Granted | 6 years 80 days |
Options Exercised | |
Weighted Average Exercise Price Exercised (in Dollars per share) | $ / shares | |
Weighted Average Remaining Contractual Life (in years) Exercised | |
Options Cancelled/Modified | (3,334) |
Weighted Average Exercise Price Cancelled/Modified (in Dollars per share) | $ / shares | $ 15 |
Options outstanding ending balance | 2,350,062 |
Weighted Average Exercise Price outstanding ending balance (in Dollars per share) | $ / shares | $ 7.84 |
Weighted Average Remaining Contractual Life (in years) outstanding ending balance | 5 years 135 days |
Options exercisable | 145,834 |
Weighted Average Exercise Price exercisable (in Dollars per share) | $ / shares | $ 23.97 |
Weighted Average Remaining Contractual Life (in years) exercisable | 1 year 200 days |
Stockholders_ Equity (Details_3
Stockholders’ Equity (Details) - Schedule of outstanding and exercisable | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Schedule of outstanding and exercisable [Abstract] | |
Option Outstanding Exercise price | $ / shares | $ 7.84 |
Option Outstanding Number Outstanding | shares | 2,350,062 |
Option Outstanding Weighted Average Remaining Contractual Life (in years) | 5 years 135 days |
Option Exercisable Weighted Average Exercise Price | $ / shares | $ 23.97 |
Option Exercisable Number Exercisable | shares | 145,834 |
Option Exercisable Weighted Average Remaining Contractual Life (in years) | 1 year 200 days |
Stockholders_ Equity (Details_4
Stockholders’ Equity (Details) - Schedule of warrant activity - Warrant [Member] | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Stockholders’ Equity (Details) - Schedule of warrant activity [Line Items] | |
Warrant outstanding beginning balance | shares | 6,130,948 |
Weighted Average Exercise Price outstanding beginning balance | $ / shares | $ 4.96 |
Warrant Granted | shares | 486,516 |
Weighted Average Exercise Price Granted | $ / shares | $ 5.13 |
Warrant Exercised | shares | (333,130) |
Weighted Average Exercise Exercised | $ / shares | $ 4.69 |
Warrant Cancelled/Modified | shares | (10,556) |
Weighted Average Exercise Cancelled/Modified | $ / shares | $ 24 |
Warrant outstanding ending balance | shares | 6,273,778 |
Weighted Average Exercise outstanding ending balance | $ / shares | $ 4.96 |
Warrant exercisable | shares | 6,273,778 |
Weighted Average Exercise exercisable | $ / shares | $ 4.96 |
Stockholders_ Equity (Details_5
Stockholders’ Equity (Details) - Schedule of outstanding and exercisable - Warrant [Member] | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Class of Warrant or Right [Line Items] | |
Warrants Outstanding Exercise price | $ 4.96 |
Warrants Outstanding Number Outstanding (in Shares) | shares | 6,273,778 |
Warrants Outstanding Weighted Average Remaining Contractual Life (in years) | 4 years 189 days |
Warrants Outstanding Weighted Average Exercise Price | $ 4.96 |
Warrants Exercisable Number Exercisable (in Shares) | shares | 6,273,778 |
Warrants Exercisable Weighted Average Exercise Price | $ 4.52 |
Stockholders_ Equity (Details_6
Stockholders’ Equity (Details) - Schedule of activity related to RSUs | 3 Months Ended |
Mar. 31, 2021USD ($)$ / shares | |
RSAs non-vested at January 1, 2021 [Member | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Total shares (in Dollars) | $ | |
Grant date fair value | |
RSAs granted [Member | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Total shares (in Dollars) | $ | $ 55,876 |
RSAs granted [Member | Minimum [Member] | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Grant date fair value | $ 4.30 |
RSAs granted [Member | Maximum [Member] | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Grant date fair value | $ 4.32 |
RSAs vested [Member] | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Total shares (in Dollars) | $ | |
Grant date fair value | |
RSAs forfeited [Member] | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Total shares (in Dollars) | $ | |
Grant date fair value | |
RSAs non-vested March 31, 2021 [Member] | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Total shares (in Dollars) | $ | $ 55,876 |
RSAs non-vested March 31, 2021 [Member] | Minimum [Member] | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Grant date fair value | $ 4.30 |
RSAs non-vested March 31, 2021 [Member] | Maximum [Member] | |
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items] | |
Grant date fair value | $ 4.32 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | May 05, 2021USD ($)m² | Apr. 01, 2021m² | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||||
Commitments and contingencies, description | The CARES Act lifts certain deduction limitations originally imposed by the Tax Cuts and Jobs Act of 2017 (“2017 Tax Act”). Corporate taxpayers may carry back net operating losses (NOLs) originating between 2018 and 2020 for up to five years, which was not previously allowed under the 2017 Tax Act. The CARES Act also eliminates the 80% of taxable income limitations by allowing corporate entities to fully utilize NOL carryforwards to offset taxable income in 2018, 2019 or 2020. Taxpayers may generally deduct interest up to the sum of 50% of adjusted taxable income plus business interest income (30% limit under the 2017 Tax Act) for 2019 and 2020. The CARES Act allows taxpayers with alternative minimum tax credits to claim a refund in 2020 for the entire amount of the credits instead of recovering the credits through refunds over a period of years, as originally enacted by the 2017 Tax Act. | |||
Taxable income percentage | 25.00% | |||
Property generally eligible term | 15 years | |||
Bonus depreciation rate | 100.00% | |||
Lease term | 5 years | 4 years | ||
Office space (in Square Meters) | m² | 2,300 | 796 | ||
Operating lease due amount | $ 411,150 | $ 108,229 | ||
Rental expense | $ 26,934.30 | $ 21,358 |
Commitments and Contingencies_3
Commitments and Contingencies (Details) - Schedule of components of lease expense | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Schedule of components of lease expense [Abstract] | |
Operating lease cost | $ 19,709 |
Short term lease cost | 3,714 |
Total net lease cost | $ 23,423 |
Commitments and Contingencies_4
Commitments and Contingencies (Details) - Schedule supplemental cash flow and other information related to leases | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Schedule supplemental cash flow and other information related to leases [Abstract] | |
Operating lease payments | $ 26,646 |
Weighted average remaining lease term (in years) | 2 years 73 days |
Weighted average discount rate | 13.00% |
Commitments and Contingencies_5
Commitments and Contingencies (Details) - Schedule of future minimum payments required under the lease | Mar. 31, 2021USD ($) |
Schedule of future minimum payments required under the lease [Abstract] | |
2021 | $ 82,336 |
2022 | 114,627 |
2023 | 53,094 |
Total | $ 250,058 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | May 13, 2021 | |
Subsequent Events (Details) [Line Items] | ||
Net proceeds | $ 115,000 | |
Subsequently repaid amount | 28,403 | |
aggregate net proceeds | $ 3,860,000 | |
Issued an aggregate stock | 1,090,908 | |
Warrants exercise price | $ 4.50 | |
Converted outstanding debt | $ 169,400 | |
Shares of common stock | 55,631 | |
Total warrants shares | 43,084 | |
Cancellation of warrants shares | 43,084 | |
Issuance of common stock | 18,259 | |
Subsequent Event [Member] | ||
Subsequent Events (Details) [Line Items] | ||
Vendor issued credit amount | $ 399,050 |