The upfront payment was to just cover their costs of the video...

The upfront payment was to just cover their costs of the video shoot. In the USA they removed it as it was too difficult to on board customers. It was only $400 or something.

The "magic" was when someone signed up to a package, as all that could be booked as receipts. That was the key, not the money for the shoot. If they canceled, defaulted, or if they expired on the package then they had to find a replacement.

The idea was to film as many businesses as possible and upsell as much as possible.

It didn't actually come crashing down. What came crashing down was the stock price, when the financial arrangement was revealed. AND then subsequently the security became worthless, so the bank (FC Capital) called in the loan.