The Marygold Companies Secures Private Placement to Finance Next-Stage Rollout Initiatives for Recently Developed Fintech Product

Rhea-AI Summary

The Marygold Companies (NYSE American: MGLD) has secured $4.38 million in funding as part of a $6.56 million total private placement with Streeterville Capital, The funding will be used to implement next-stage initiatives for the company's Marygold & Co. project, including marketing its recently developed fintech app.

The app, soft-launched in the U.S. in 2023, offers a digital platform alternative to traditional banking, enabling users to spend, invest, and save. It features a digital wallet, physical debit card, and additional functionalities like unlimited money pool investing and PayAnyone™ capability. The company plans further U.S. market penetration and introduction in the U.K. later this year.

Maxim Group served as the exclusive agent for the private placement. A second funding portion is anticipated for January 2025, subject to certain conditions, with expected proceeds of approximately $2.0 million.

Positive

• Secured $4.38 million in funding with potential for additional $2.18 million
• Successful development and initial testing of fintech app completed
• Plans for further U.S. market penetration and U.K. introduction
• Acquisition of two UK-based investment advisory firms with established client bases
• App offers fee-free banking alternative with advanced features

Negative

• Significant investment of $15 million over five years from internal resources
• Second portion of funding subject to certain conditions

Insights

Financial Analyst

The Marygold Companies' (MGLD) securing of a $4.38 million private placement, part of a larger $6.56 million deal, is a significant development for this $62.9 million market cap company. This funding, earmarked for the rollout of their fintech app, represents a substantial 10.4% of their market capitalization. The company's transition from internal funding to external capital for this project suggests confidence in its commercial potential. However, investors should note that this comes with dilution risks and increased debt. The app's features, including no-fee banking and investment options, position it competitively in the fintech space, but success will depend on user adoption and monetization strategies. The planned UK expansion through recent acquisitions could provide a growth avenue, but also carries execution risks. Overall, this funding marks a important phase in MGLD's fintech ambitions, with potential for significant upside if successful, balanced against the financial obligations and market uncertainties.

Tech Expert

The Marygold Companies' fintech app represents an intriguing entry into the competitive digital banking space. Key features like:

• Digital wallet with physical debit card
• No banking fees or minimums
• Unlimited money pool investing
• PayAnyone™ capability
• Contactless payments

position it as a comprehensive financial management tool. The app's availability on both iOS and Android platforms ensures broad accessibility. The integration of investment features with day-to-day banking functionalities could be a significant differentiator. However, the success of such apps heavily depends on user experience, security measures and the ability to scale rapidly. The $15 million internal investment in development suggests a robust foundation, but the real test will be in user acquisition and retention as they expand. The UK market entry, leveraging acquired advisory firms, is a smart strategy for international expansion, potentially accelerating user growth. However, compliance with different regulatory environments will be important for successful cross-border operations.

-Company Enters Note Purchase Agreement for up to $6.56 Million-

SAN CLEMENTE, Calif.--(BUSINESS WIRE)-- The Marygold Companies, Inc. ("TMC" or the "Company") (NYSE American: MGLD), a diversified global holding firm, today announced it has secured $4.38 million in funding as part of a $6.56 million total private placement with Streeterville Capital, LLC, an institutional investment firm, through the sale of the Company’s secured promissory note.

Net proceeds will be used exclusively to implement next-stage initiatives for the Company’s Marygold & Co. project, including initial marketing of its recently developed fintech app., a digital platform alternative to traditional banking that enables users to spend, invest and save.

“As part of our strategic plan to develop and test the viability of the platform, we invested more than $15 million over the past five years from cash and profits internally generated by our operating subsidiaries,” said Nicholas Gerber, TMC’s chief executive officer. “With the critical development and initial testing phase now successfully behind us, we are pleased to have attracted external funding for the rollout stage, which we believe attests to the uniqueness of the app and the long-term potential of its commercial success.

“The app was soft-launched in the U.S. in 2023 by our Denver-based subsidiary, Marygold & Co., and plans are underway for further U.S. market penetration. Through our Marygold & Co. (UK) subsidiary, we recently acquired two UK-based investment advisory firms with established client bases that we believe will provide a solid marketing foundation when we introduce the app in the U.K. later this year,” Gerber added.

The app, which features a digital wallet as well as a physical debit card, is akin to having a fully secured, private banking experience on a cell phone to manage finances anywhere, anytime, with no banking fees or minimums. It allows users to organize finances, while helping them save for personal financial goals. It is currently available in the U.S. at no cost in both Apple and Google app stores for iOS and Android devices. Additional features include unlimited money pool investing, with customized portfolios and user-selected time-based objectives; PayAnyone™ capability, authorizing users to send payments to anyone in the U.S., regardless of whether they have a Marygold & Co. account; contactless payment options; and more.

Maxim Group LLC served as exclusive agent for the private placement. Funding for the second portion is anticipated for January 2025, subject to satisfaction of certain conditions, with expected proceeds to TMC before expenses of approximately $2.0 million. A full description of the terms and conditions of the transaction, as well as the exhibits filed therewith, can be found in the Company’s Current Report on Form 8-K, filed today with the SEC and available at www.sec.gov.

Securities associated with the private placement have not been registered under the Securities Act of 1933, as amended, and may not be resold in the U.S., except pursuant to an effective registration statement with the U.S. Securities and Exchange Commission, or an exemption from registration under the Securities Act and any applicable state securities laws. This press release does not constitute an offer to sell or the solicitation of an offer to buy, nor will there be any sales of associated securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

About Marygold & Co. and Marygold & Co. (UK)

Marygold & Co., https://marygoldandco.com/, headquartered in Denver, Colo., is a wholly owned TMC subsidiary established in 2019 to explore opportunities in the financial technology sector. Marygold & Co. (UK) Limited, https://marygoldandco.uk/, also a wholly owned TMC subsidiary, was established in the U.K. 2021 and operates through two U.K.-based investment advisory business units: Tiger Financial & Asset Management Limited (“Tiger”), acquired in 2022, http://www.tfam.co.uk/, and Step-by Step Financial Planners, acquired in 2024, https://www.sbsfp.co.uk/, that manage clients’ financial wealth across a diverse product range.

About The Marygold Companies, Inc.

The Marygold Companies was founded in 1996 and repositioned as a global holding firm in 2015. The Company currently has operating subsidiaries in financial services, food manufacturing, printing, security systems and beauty products, under the trade names USCF Investments, Marygold & Co., Tiger Financial & Asset Management Limited, Step By Step Financial Planners, Gourmet Foods, Printstock Products, Brigadier Security Systems and Original Sprout, respectively. Offices and manufacturing operations are in the U.S., New Zealand, U.K., and Canada. For more information, visit www.themarygoldcompanies.com.

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of U.S. federal securities laws. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may” “will,” “could,” “should” “believes,” “predicts,” “potential,” “continue” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements, including, but not limited to, introducing the Company’s mobile fintech app in the UK later this year and its long-term commercial success, involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results and, consequently, you should not rely on these forward-looking statements as predictions of future events. These forward-looking statements and factors that may cause such differences include, without limitation, satisfaction of customary closing conditions related to the offering, the expected timing of the closing of the offering and the risks disclosed in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission and in the Company’s other filings with the Securities and Exchange Commission. The foregoing list of factors is not exclusive. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Except as required by law, the Company disclaims any obligation to update or publicly announce any revisions to any of the forward-looking statements contained in this press release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240924438824/en/

Media and investors, for more Information, contact:

Roger S. Pondel

PondelWilkinson Inc.

310-279-5965

rpondel@pondel.com

Contact the Company:

David Neibert, Chief Operations Officer

949-429-5370

dneibert@themarygoldcompanies.com

Source: The Marygold Companies, Inc.

FAQ

What is the total amount of private placement funding secured by The Marygold Companies (MGLD)?

The Marygold Companies (MGLD) has secured a total private placement of up to $6.56 million, with an initial funding of $4.38 million already received.

What will The Marygold Companies (MGLD) use the funding for?

The funding will be used exclusively to implement next-stage initiatives for the company's Marygold & Co. project, including initial marketing of its recently developed fintech app.

When was the Marygold & Co. fintech app soft-launched in the U.S.?

The Marygold & Co. fintech app was soft-launched in the U.S. in 2023.

What are the key features of the Marygold & Co. fintech app developed by MGLD?

The app features a digital wallet, physical debit card, unlimited money pool investing, PayAnyone™ capability, contactless payment options, and allows users to spend, invest, and save without banking fees or minimums.