Have a read of the sponsorship announcement December 2015..
https://www.asx.com.au/asxpdf/20151208/pdf/433mxbwdp5zgj7.pdf
While we don't know the details of how the arrangement works, we can at least provide opionions to see what sense we can make of it..
-BIG expected over $300k of revenue from the agreement (sponsorship/advertising) till end of March quarter 2016.
So what does sponsorship mean? Did FC Capital pay for part of the production costs if the customer agreed to certain conditions (eg. rolling advertising under their video)? Do FC Capital have a gsa over BIG's assets to make sure that whatever clients signed up to that agreement are actually videoed & the product is delivered as promised?
If that's the case, then I would presume FC Capital front some money to BIG but perhaps not all. And those moneys would act like a debt until the service is provided. Also, since it's supposed to be only a select number of customers (FC Capital wouldn't want to sponsor every video), then it would be a relatively small proportion of total revenues, unless it was a scam of course. But if it was a scam, both FC Capital (and BIG) would lose out in the end, so why take that sort of risk. And from what I can tell FC Capital are not a fly by night operation.
I agree there are questions that need to be answered, but I don't think it can be anywhere near as bad as what JS is implying. FC Capital have stated that the gsa only applies to the sponsorship agreement. Any other sign ups of customers directly with FC Capital are at FC Capital's risk.
Thoughts?
