The key phrase there is "with a credible plan".
Redflow burned through credibility like it was kindling. For me, at least, the biggest problem was Tim (Harris)'s comments about their warranty issues and the resolution of them: his comments didn't align with what I experienced with my battery, and that raised a whole bunch of red flags in my mind. The trouble is, what he said was plausible and reasonable - it was only because I'd experienced a battery failure, and the symptoms I'd seen didn't seem to align with what he said (or implied) was the root cause, that I had those concerns.
There's also the point that others have made about the directors having skin in the game. They
chose to not take up their entitlement at the last raising (and, if memory serves, the one before). That doesn't speak well of their confidence in the company - yes, you want diversification to manage your risks and exposures, but these are insiders. These are the people who should have the best picture of the company prospects. If the prospects are good, you'd expect them to be overweight in the business.
Hindsight is a wonderful thing. If I had known then what I know now, I would never have bought a ZBM, and I would never have invested in the company. But that's not the way this works.
There is still a faint chance. They could restructure the business, focus it on delivering the X10 (the ZBM is essentially a burnt bridge now, I don't see the company being able to go back to it even if they wanted to), and make a success of it. But there's an awful lot that would have to go right for that to happen. My feeling is that the key things that need to happen are:
- Tim needs to go. He's been drawing a salary that is well out of alignment with the value he's delivered; and his association with the company's failures are likely to be a millstone around the company's neck if he stays.
- They need to figure out exactly why the ZBMs are failing, and how to fix it. The X10 cannot succeed if they don't figure this out, since it's essentially a scaling up of that tech. Word from people I know is that there are a lot of failures; more than the company is directly acknowledging (though there is a strong implication in the financials with the amount they've set aside for warranty provisions.)
- They need to be much more honest about where the company is, what the challenges are, and what they're doing about them. There's too much evasion and glossing over of problems.
I would guesstimate a maybe 20% chance that they'll figure it out and come through the other side with a few scars. That's a guess on my part, there's nothing substantial backing it up.
I do have my fingers crossed for all holders. Strap yourselves in; there's no getting off the ride now until it comes to the end, whatever that end might be. My advice: resign yourself to your holdings being a complete write off; that way, if the company does pull through, you have a pleasant surprise awaiting you, and if it doesn't, well, you've already set yourself up for that scenario. Good luck. I have a feeling you're going to need it.
(20min delay)