Risks Specific to Vodi
We have a limited operating history, and our future profitability will depend in large measure upon our ability to sell our products.
The Company has a limited operating history on which to base an evaluation of its business and prospects of revenues from its products. The Company is subject to all of the risks of failure inherent in the development of an early stage technology company. It is extremely difficult to predict the internal and external issues that must be overcome if the Company is to be successful.
Our operating results may be volatile and difficult to predict.
Our operating results may fluctuate significantly in the future due to a variety of factors, many of which may be outside of our control. Due to the emerging nature of our market, we may be unable to accurately forecast our revenues and operating results.
There is no public market for our stock, and the stock is subject to restrictions on transfer.
The Shares offered hereby have not been registered under the Securities Act, or
under applicable state securities laws, and no provision has been made for registration under the Securities Act or under any state securities laws so as
to permit any public distribution or resale of the securities.
Accordingly, each investor must be prepared to bear the economic risk of a total loss of the investment and must be prepared to hold the Shares indefinitely, since such investor may not be able to liquidate the investment in the foreseeable future, or at all. There is not now, and there may never be, a public market of any kind for the Company’s Common Stock or any other securities of the Company.
This is a best efforts offering and early investors face higher risks if the maximum offering is not completed.
We are offering the Shares on a “best efforts” basis. Monies accepted from early investors will be used by us even if the total Offering is not completed. We cannot assure you that all of the Shares will be sold or that our business will operate or develop in the manner planned. If not, early investors may lose all or a substantial part of their investment. We will use the proceeds from this Offering for working capital and general corporate purposes. Our working capital may be used, among other things, to employ key personnel to expedite development and marketing of our product, pay accrued expenses and salaries, further product and website design, to develop a mobile and tablet version of the application, obtain or expand office space, increase sales and marketing expenditures, pay travel expenses for sales representatives and our executives, purchase or lease computer software and equipment, and for the addition of customer support personnel and supporting equipment. We may not meet our revenue, growth or profitability targets, particularly if all of these expenses are not satisfied from the proceeds of this Offering. Therefore, early investors in this Offering are subject to a greater risk that they will lose their entire investment if we do not complete the sale of the maximum number of Shares offered by us.
We will need to obtain significant additional capital following this Offering and we cannot assure you that additional capital will be available to us or, if it is available, that it will be on terms acceptable to us or otherwise favorable to our stockholders.
We will need to raise additional capital in the future to provide a more substantial base of working capital. While we may seek to raise this capital through debt or the sale of our stock at increasing valuations, no assurance can be given that debt financing will be available or that future investors will be willing to invest at our increased valuation levels or otherwise. We have no commitment for any such additional future capital, and we cannot assure that additional capital will be available to us on terms acceptable to us, or at all.
Further, the investors in this Offering will not have any anti-dilution rights. Any sale of equity in the future may be highly dilutive or on terms disadvantageous to investors in this Offering.
We will not pay dividends.
We currently intend to retain any future earnings to fund operations and the continued development of our business and, therefore, we do not anticipate paying any cash dividends on our capital stock in the foreseeable future. Future cash dividends, if any, will be determined by the Board, and will be based upon the Company’s earnings, capital requirements, financial condition, and other factors deemed relevant by the Board.
Investor Capital Immediately at Risk.
Except as required by the securities laws of some states, subscribing investors may not withdraw any subscriptions once they have been accepted.
Possibility of unidentified Risks.
The risks set forth above are not a complete list of the potential risks facing the Company. The Company realizes that there may exist significant risks yet to be recognized or encountered to which it may not be able to effectively respond. There can be no assurance that the Company will be successful in addressing the listed risks or future potential risks, and any failure to do so could have a material and adverse effect on the Company’s business, financial condition, and results of operations.
8. If we are not able to develop enhancements and new products and keep pace with technological developments, we might not be competitive in the market place and our business could be adversely affected. Our future success will depend on our ability to adapt and innovate. To attract users and generate revenue, we need to enhance, add new features and improve our existing limited products and introduce new products. The success of any enhancements or new features and products depends on several factors, including timely completion, introduction and market acceptance. We may expend significant time and resources developing and pursuing sales of a particular product that may not result in revenues in the anticipated time frame or at all, or may not result in revenue growth sufficient to offset increased expenses. If we are unable to successfully develop enhancements, new features or new products to meet market needs, our business and operating results could be adversely affected. In addition, because our products are or will be designed to operate on a variety of platforms using Internet tools and protocols, we will need to continuously modify and enhance our products to keep pace with changes in Internet-related technologies. If we are unable to respond in a timely and cost-effective manner to these rapid technological developments, our current and future products may become less marketable and less competitive or even obsolete. Our business model is heavily dependent on third party relationships, why may or may not, come to fruition.
9. We may not be able to access third-party technology upon which we depend. We use some technology and software products and platforms from third parties. Technology from our current or other vendors and strategic partners may not continue to be available to us on commercially reasonable terms, or at all. Our business will suffer if we are unable to access this technology, to gain access to additional products or platforms or to integrate new technology with our existing system. This could cause delays in our development and introduction of new services and related products or enhancements of existing products until equivalent or replacement technology can be accessed, if available, or developed internally, if feasible. If we experience these delays, our business (including our ability to satisfy any repayment of the Notes) and the value of any equity you receive upon conversion of the Note could be materially adversely affected.
There is the possibility that a competitor of Vodi will launch the same type of business model and product set.
It has taken Vodi over 2 years to establish and advance the mobile communication app with a unique business model; however, there is always the possibility that someone "builds a better mousetrap".
The Over The Top and free chatting/messaging has been completely tax free for anyone to be able to provide this service. However, there have been talks and discussions about the government stepping in and finding a way to tax this service. If that happens, that could change our model.
We may not be able to increase the awareness of our brand in the marketplace as quickly or as effectively as is necessary to insure revenue growth.
Potential customers must be aware of our mobile app brand in order to download our app. We need to attract new users to our mobile app and that would require us to devote more resources to marketing efforts, including advertising and other expenses, to build public awareness of our brand. However, even with an enhanced marketing effort, there is no guarantee that we will be able to increase the number of new downloads to our mobile app and in turn, convert them into paying customers. Any number of conditions could affect the success of our marketing efforts, including a unsuccessful marketing campaign, inability to expand our product portfolio to keep customers interested, inability to keep up with new technologies that could have a negative impact on user experience.
Although all of the officers and directors have great experience in the same industry, Investors should be aware of that all officers are currently working full time at the Vodi's Parent company Lunex Group, and part time at Vodi. As such, it is likely that the company will not make the same progress as it would if that were not the case.