I think this capital raise is good news. It was only a matter of...

I think this capital raise is good news. It was only a matter of time before the company raised additional growth capital (given it's in scale-up mode) and this should remove the cap raise overhang and enable the management team to keep generating strong growth and get to profitability.

Raising growth capital via convertible loans is far preferable than equity in my view:
- a $3.8m equity raise would have been done at a massive discount given the dreadful market environment (particularly for small and micro caps) and therefore been extremely dilutive for existing shareholders.
- the convertible loans can be fully redeemed for cash at WRK's option. WRK can therefore avoid diluting shareholders by repaying the loans from operating cash flow prior to the 2 year maturity (or, as a fall back, raise capital (debt, hybrid or equity) to redeem the loans down the track when the business is significantly larger/stronger and the market environment less crappy...).

The SPP gives us all a good opportunity to top up at low valuation (I will be certainly be doing so).

Also great to see a director stepping up with a $500k cheque - you don't see that every day!