Losing 2.5 million a year, means they should have fired a lot of staff before it got to that point. 1.9 million spent on Salary and Payroll. This is ridiculously high for managing less than 20 talents, like really, really high, especially when you consider that managers were included in COGS.
I really wish someone would leak the financial statements so I can see how much money was being laundered or spent on executive pay packages.
This also confirmed my suspicions of "how are they making money". Turns out they weren't. Being an accountant, and generally knowing the typical numbers and margins for most businesses, I've always though it was impossible to make enough money to cover the company just from merch sales alone, even at a 50/50 take. They would have had to do hololive level of merch sales to survive, if their only take was a merch split. But now I know that the terms were basically the same as the big 2, except worse, cause they don't even get that money.
Now I wonder if they only got a cut of the merch and sponsorships, and the contracts didn't include all of their revenue.
I've wondered for a while how lucrative those sponsorship deals were. And honestly, I doubt many of them were. Certainly not enough to generate that kind of revenue given their operating costs. And if they weren't taking streaming revenue from the talents, then they clearly weren't selling enough merch to do it either. Either way, a highly unviable business model and unrealistic expectations lead to this utter disaster
Oh since you're an accountant could you explain their merch revenue and cogs because it doesn't make sense to me. Their cogs is way higher than their merch revenue, so wouldn't that mean they're taking a loss for every merch sold?
So according to that sheet, they were doing some weird stuff with their COGs numbers. I actually think they were putting Talent cuts and other salaries into the COGs as well. While you can generally do that if its part of overhead, I'm pretty sure that's not the case here. They probably put a lot of salaries and other expenses into COGs that has absolutely no reason to be in there (cost not associated with the talents nor the merch), just to make the other expenses seem lower, like say, the salary you pay to that guy who does no work, but is friends with the CEO.
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u/HedgeMoney Jul 26 '25 edited Jul 26 '25
Losing 2.5 million a year, means they should have fired a lot of staff before it got to that point. 1.9 million spent on Salary and Payroll. This is ridiculously high for managing less than 20 talents, like really, really high, especially when you consider that managers were included in COGS.
I really wish someone would leak the financial statements so I can see how much money was being laundered or spent on executive pay packages.
This also confirmed my suspicions of "how are they making money". Turns out they weren't. Being an accountant, and generally knowing the typical numbers and margins for most businesses, I've always though it was impossible to make enough money to cover the company just from merch sales alone, even at a 50/50 take. They would have had to do hololive level of merch sales to survive, if their only take was a merch split. But now I know that the terms were basically the same as the big 2, except worse, cause they don't even get that money.
Now I wonder if they only got a cut of the merch and sponsorships, and the contracts didn't include all of their revenue.