A potentially lethal chain of events
Lottery.com Inc. is facing several financial impediments including debt and an inability to pay its workers.
expected to furlough a hefty portion of its workers
The lottery technology company said Friday that it does not have the $425,000 necessary to pay its employees. As a result, the company is expected to furlough a hefty portion of its workers.
Lottery.com is also wary of future setbacks, should they be forced to release their developers and engineers. Customer loss, contract violations, and a breakdown in the work chain could all follow these dismissals.
Lottery.com declines quickly
Founded in 2015, lottery.com is a service that allows gamblers to purchase and monitor the lottery from their phones.
The company’s stock was fairly flat from 2018-2020 before oscillating in 2021, only to then free-fall to its current trading price of 0.33 USD, roughly $10.50 lower than it was a year prior (updated Friday, July 29).
The stock’s decline reflects many of the issues facing the company, which were detailed in a filing with the U.S. Securities and Exchange Commission (SEC).
does not currently have sufficient financial resources to fund its operations”
“[Lottery.com] does not currently have sufficient financial resources to fund its operations or pay certain existing obligations, including its payroll and related obligations,” said the letter. “The company’s inability to pay this amount may result in employees terminating their relationship with the company and/or pursuing legal remedies.”
The letter also cast significant doubt over the company’s ability to fund operations for the next 12 months. As a result, there is “substantial doubt about the company’s ability to continue.”
No immediate resolutions
Lottery.com’s chief legal and operating officer and the only remaining C-level employee, Katherine Lever, signed the filing.
The development comes shortly after the company “overstated” its holdings by $30m a couple of weeks after firing former president and CFO, Ryan Dickinson. chief executive Tony DiMatteo also left the company last week.
instances of non-compliance with state and federal laws”
The news also follows a review that showed “instances of non-compliance with state and federal laws concerning the state in which tickets are procured.”
Lottery.com’s struggles are especially damning with the ongoing multi-state mega-lottery. The MegaMillions jackpot has reached a total of $1.28bn, making it just the fourth-ever to surpass $1bn. Normally, this would drive lottery companies’ business through the roof.
The company is already preparing to shut down most, if not all, of its services if it cannot find more funding quickly.