Dan Bilzerian, the Instagram playboy and the CEO of Ignite International Brands Ltd (OTCMKTS: BILTZSF) seems to have chosen to stay silent about the controversies or problems surrounding the Canadian cannabis company. His silence is entirely uncharacteristic since he renowned for his braggadocio who constantly engages with his fanbase on social media platforms.
This has led many people to ask, ‘why so quiet all of a sudden?’ It is a known fact that Bilzerian’s company posted $50 million in losses for 2019. By looking closely at last year’s filings, it is clear where all of the company’s supposed profits went.
For one, Ignite spent $43 million just on operational costs including advertising costs, office leases, and marketing campaigns. Apparently, for every dollar in sales, approximately $9.6 million, the company spends another two dollars or $18.4 million on administrative costs.
To make matters worse, former Ignite President Doug Heffernan filed a lawsuit against Bilzerian earlier this year. Heffernan claimed that Ignite ousted him after raising concerns about Bilzerian’s extravagant spending habits which includes private jets, yachts, and luxurious dinners with beautiful women.
As one former Ignite anonymously put it, “Ignite pays for everything. Models, events, yachts. Dan would just have it wrapped with the Ignite logo, and all of a sudden it was an Ignite expense and he would send them the bill,” which is in line with the claims made in Heffernan’s lawsuit.
Of course, none of this is new for Bilzerian’s 30 plus million followers on Instagram who are given a front-row seat to the lifestyle of the jet setting millionaire that appears to be on top of the world.
What is new, however, is Bilzerian seems to have stopped talking about Ignite on social media. A recent annual report from Ignite’s board of directors offers a sort of explanation about his absence or silence. Internally, it appears things are not looking so great:
“The Company will need to raise capital in order to fund its operations and continue its existing and prospective expansion into strategic markets. This need may be adversely impacted by uncertain capital market conditions, including those created by the COVID—19 pandemic, an inability to secure strategic partnerships in key markets, and an unfavorable perception of the IGNITE brand,” said the board.
They further added that Ignite’s future remains uncertain, saying “Although the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms that are acceptable to the Company. The uncertainty of the Company’s ability to achieve profitable operations and its success in raising additional capital funding may cast significant doubt on the Company’s ability to continue as a going concern.”
That said, Ignite’s current troubles cannot be directly attributed to Bilzerian himself, it is a company after all. Nor can it be confirmed that the company is on the edge of bankruptcy, but the annual report does raise eyebrows.
His father, Paul Bilzerian is reportedly running Ignite behind the scenes, which also raises questions of legality since he is a convicted fraudster.
Either way, it will be interesting to see and hear what Bilzerian does and says to investors and to his millions of fans regarding Ignite’s financial situation and the concerns his father has taken a less shadowy role within the company.
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