DriveItAway Holdings, Inc. (DWAY), a national dealer-focused mobility platform, has reported a net loss of $540,387 for the six months ended March 31, 2023, according to the company’s latest SEC report. Despite the loss, the company has continued to grow and expand since its inception in 2006. By enabling car dealers to sell more vehicles seamlessly through its proprietary eCommerce platform and app-based ‘Pay as You Go’ subscription program, DriveItAway aims to revolutionize the automotive industry.
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Capital Raising Activities
Although the reported net loss was significant, the company had several accomplishments during this period. DriveItAway strengthened its balance sheet by raising capital through various sources. The company raised proceeds from convertible notes payable amounting to $261,500 and gained an additional $50,000 in promissory notes payable from related parties. This increased cash provided by financing activities reached $322,352 in the reported period.
Revenue and Expenses
DriveItAway’s primary source of revenue is from its online platform, which assists subprime customers in purchasing used vehicles through a turnkey rental program. The company also generates revenue by providing driver and vehicle insurance through a third-party insurance provider. During the six-month period, DriveItAway’s total revenue stood at $857,782. Unfortunately, the company faced elevated expenses, including stock-based compensation and operating costs, which contributed to the net loss.
Expansion Plans
In addition to its core business model, DriveItAway has been working on expanding its services. The company is planning to launch a consumer app that will allow entry-level consumers to drive and acquire new Electric Vehicles (EVs) through a subscription-to-ownership model.
Going Concern and Financial Challenges
However, the company’s continuous net losses and cash flow uncertainties have raised concerns about its ability to continue as a going concern. Despite management’s efforts to obtain additional capital resources from various sources, there is no assurance that DriveItAway will be successful in realizing these plans. To achieve profitability, the company needs to establish sufficient revenue to cover its operating costs and ensure adequate capital for business operations.
Management’s Plans for Additional Capital
Management has stated plans to obtain additional capital from sources such as sales of equity instruments, traditional financing, and funding provided by management and significant stockholders. This capital will be utilized to sustain business operations, cover operating costs, and invest in the business’s growth and expansion.
Conclusion
Although DriveItAway faces financial challenges, its innovative platform and ambitious plans for growth showcase the potential to transform the automotive industry. It remains to be seen whether the company can secure the necessary funding to ensure long-term success and become a driving force in the rapidly evolving EV market.
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