re: Let’s discuss WTRH in this thread

Was up about 10% AH and then went back down. Decent revenue growth. I think everyone is waiting on the call now.

Ouch... I plan to just sit on what I’ve got. Seems like a huge overreaction. But the call was pretty lame. Still haven’t filled the CFO role.

I believe they get 30 days sub $1 on the NASDAQ before the start the delisting procedures.

Not good for WTRH

quote:

---

Seems like a huge overreaction.

---

1 - CEO/Founder – moved to “Chairman” and out of CEO role

2 – COO (top level executive from Bite Squad) left company in September

3 - CFO just left the company

4 - Two directors just left the company

5 - Stock in danger of being de-listed because of price and items 3 and 4 (above)

6 - Getting out of several underperforming markets (38 have been announced) even though the size of those markets are their “target” markets

7 – lawsuit(s) from drivers

8 – Class action suit(s) being filed and the basis for those suits are as follows:

Defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (1) Waitr was not on the verge of profitability; (2) Waitr was not providing its services at a sustainable low take rate established at 15%; (3) Waitr was unable to extract efficiencies from its full time fixed-rate labor force that was purported to allow the Company to offer its services at a lower rate than competitors; (4) its software provided little or no competitive advantages and what first-mover advantage Waitr claimed existed, was quickly squandered by the inability to obtain sophisticated high-level programmers and software engineers who could enable Waitr to refine and develop the software necessary to stay competitive in its market; (5) Waitr did not maintain an adequate system of internal controls so as to report and eliminate material conflicts of interest; and (6) as a result, Waitr's public statements were materially false and misleading at all relevant times. When the true details entered the market, the lawsuit claims that investors suffered damages.

9 - $220M loss in Q3 and $190M of that was charges related to the botched Bite Squad purchase

10 – Burned through $20M in cash in Q3 and only has $52M left (and a long way from making a profit)

11 - Major competitor (Grub Hub) stock lost 40% in one day based on their last earnings report

12 – Announced this week the layoff of 300 workers. While not a bad thing given their cash burn, there must be some serious talent drain within those numbers. The layoff numbers include cutting half of their sales force which will likely result in slower revenue growth

Hopefully Drew Brees got his initial $10M back

quote:

---

Do you know when he invested?

---

Looks like middle of March 2017 but he was part of “The group of Gulf South-based investors was led by New Orleans Saints quarterback Drew Brees...”

DaIly Advertiser article

quote:

---

the current market cap is only like $20 million.

---

from almost a billion six months ago

quote:

---

Then again, he bought millions of dollars in jewelry as an "investment"

---

Yes, I woiuldn’t judge his business sense to be stellar based on the jewelry debacle.

quote:

---

I’m surprised this hasn’t gotten more discussion. It seems like he feels entitled to returns and his investments shouldn’t be subject to risk like everyone else.

---

I don’t want to derail but that wasn’t the issue at hand to my limited knowledge. Brees is an idiot, but the guy selling him the jewelry grossly inflated the value/ appraisal of the jewelry at the time of purchase. I believe it was more like purchase this for X and the appraisal is X + Y when in reality the value of the jewelry at time of purchase was X - Z. Anytime someone buys jewelry with some value the appraisal is always higher but in reality for a vast majority if you try and re sell it is is less then you paid. So it wasn’t necessarily that the jewelry was supposed to increase in value but that it was worth more from the beginning. Which I guess is somewhat the same. But all Brees had to do was get an independent appraisal before dropping $20 mil and he’d have known.

Eta: are there any expectations of what’s going to happen with the stock this low? Surprised buy outs aren’t being discussed from someone like Uber Eats with stock options. Uber has to have that kind of money available.

quote:

---

Why would anyone buy Waitr? Food delivery is going nowhere. There is no barrier to entry and zero changing costs. I live in Chicago and can get my food delivered by 10+ different companies - there are zero switching costs.

---

I don’t disagree at all. I honestly think the main future is with the restaurants offering delivery themselves for $5 or whatever going back to the old pizza delivery format. That’s the most profitable way.

But what’s the other option here? Bankruptcy? Taking the company private? I don’t see it lasting in the current state.