One of the things I look closely at in annual accounts is the amount of share based expenses incurred by microcap hopefuls.
I revealed last week that Yojee paid its Exec Director $600+k in share based remuneration even though its full year's revenue was just $400+k. And today, Buddy Platform showed that it incurred $3.46m in share based remunerations when its full year's revenue was just $2.08m. Clearvue (CPV) was on my watchlist until I saw today that its share based remuneration expenses was $2.3m when its full year revenue (excluding grant) was just $75k and had $3.44m loss for the year.
Companies that pay their management lucrative share deals ahead of their financial performance only demonstrate that they are not working towards shareholders interests- they put their own ahead. I have no qualms about share based incentive performance shares BUT only when it is related to the financial outcomes the company produces and in amounts which commensurate with the company's stage of progress and financial position. Instead these companies dish out these share based performance shares on metrics that have no correlation with the company's financial well being. Take Buddy Platform (BUD for instance, the metric was for
“the total number of devices creating an interaction with a Buddy application that it has not previously interacted with (New Connection) exceeds 500,000 per week for no less than three (3) consecutive weeks” within two years and for that the company vested 33 million shares! You have to look at what Appen did and how much they provided and you can determine that Appen management didn't need to resort to these sorts of payments to themselves because they had a very successful company.
