MassRoots, Inc. (OTCMKTS:MSRT) Loses 47% in Three Sessions
Hype can be a great power and it has proven its ability to do a lot for certain pot stocks back in 2014. However, hype can only carry a stock so far before reality starts settling in. MassRoots, Inc. (OTCMKTS:MSRT) had a spectacular run up the charts shortly after going public and having its first session on April 9. However, after climbing 140% within seven sessions, MSRT is now crashing back down in a manner that is just as spectacular.
MassRoots is a mobile app business focusing on weed lovers. The eponymous app wants to be a Facebook and Instagram mashup where people can post photos of themselves smoking joints without their family and boss seeing this content on ordinary social media. The company has not focused on generating revenues so far, hence the $9 thousand in annual 2014 revenues. So far all efforts have been aimed at growing the app’s userbase. According to figures provided by the company, there are currently 275,000 “registered users”.
Why MSRT decided to use this as a metric is unclear – everyone who installed the app out of curiosity, then uninstalled it and never looked at it again counts as a registered user. Some Useful metrics measuring the success of social networks are daily active users and monthly active users – numbers that MSRT has not provided so far. To put things into perspective, before its IPO Twitter disclosed having 232 million users. Those, however, were monthly active users. The total number of registered users back then was about 883 million.
MSRT dropped a press release late Sunday afternoon. The company announced a partnership and an ‘equity position’ in Flowhub – a venture still in beta, described as a ‘dispensary seed to sale system’. With certain new features of the MSRT app and the partnership of Flowhub, MSRT expects to have about 1,000,000 users by the end of 2015. Hopefully, those are not ‘registered’ total users once again.
Flowhub should also not be confused with the visual programming solution that went through a successful Kickstarter last year and is spelled out as FlowHub. The Flowhub MSRT is partnering with is a company run by CEO and co-founder Kyle Sherman. Investors may be intrigued to find out Mr. Sherman has an extensive background in movie production and editing but his experience with marijuana appears to be a bit more limited and the business plan behind Flowhub is vague at best, for lack of any real information on the endeavor. Putting “seed-to-sale” in your company’s description is not saying much, as even companies such as American Green, Inc. (OTCMKTS:ERBB) describe themselves as “seed-to-sale” businesses and ERBB has been stuck under a penny per share for over a month now.
There is also the matter with the millions of shares MSRT issued at $0.10 per share before going public, which we covered in more depth in previous articles.
Sunday’s PR has the potential to give the price a boost but only time will tell how things pan out in the long run.
