Company Number: 13836904

Analysis Date: 2025-07-20 11:36 UTC

1. Risk Rating: LOW
   The company demonstrates a strong improvement in financial position from the previous year, with positive net assets and significant cash reserves. There are no overdue filings or liquidation concerns, supporting low risk in solvency and regulatory compliance.

2. Key Concerns:

• History of negative net assets and working capital in initial years (2022 and 2023) may indicate early-stage operational losses and funding needs.
• Significant reliance on capital injection reflected in a large share premium account (£2.68M) rather than operational cash flow, which may pose sustainability risk if additional funding is not secured.
• Change in key directors in early 2025 could impact governance continuity and strategic direction.

3. Positive Indicators:

• As of January 2024, net current assets stand at £1.16M and net assets at £1.43M, indicating a solid liquidity position and solvency.
• Cash balance of £1.45M provides strong short-term liquidity to meet obligations comfortably.
• The company is compliant with all filing deadlines for accounts and confirmation statements, reflecting good regulatory adherence.
• Expansion of intangible assets, including capitalized development costs, suggests investment in growth and potential future revenue streams.
• Small company status with exemption from audit reduces operational overhead.

4. Due Diligence Notes:

• Review the nature and sustainability of the revenue streams, particularly platform income and NFT-related income recognition policies, as these are relatively novel and may carry valuation risk.
• Assess funding sources that contributed to the large share premium account and whether further capital injections are planned or required.
• Examine the impact of director changes on company strategy and internal controls, especially given the resignation of three directors and appointment of a new director within a short period.
• Verify the assumptions and valuation methods used for intangible asset revaluations, ensuring amortization and impairment policies are appropriate.
• Confirm that the company’s going concern statement is supported by cash flow forecasts and contracts or agreements underpinning future revenue.