It’s happened to all of us. We’ve been out with friends, we’ve been at work, and we go to grab our wallet only to realize it’s still on the dresser. For us, it’s an inconvenience. When you’re a subscription service with cash flow problems trying to leverage your ticketing service to grab a piece of the film exhibition industry, it means you borrow $5 million.
Business Insider reports that a “service interruption” on July 26th wasn’t because the servers were down or too many people were trying to get into Mama Mia 2. MoviePass was, for a few hours, flat broke:
In a Securities and Exchange Commission filing on Friday, the owner of MoviePass, Helios and Matheson Analytics, disclosed that it had borrowed $5 million in cash following a “service interruption” on Thursday because the company was unable to make certain required payments.
“The $5.0 million cash proceeds received from the Demand Note will be used by the Company to pay the Company’s merchant and fulfillment processors,” the filing said. “If the Company is unable to make required payments to its merchant and fulfillment processors, the merchant and fulfillment processors may cease processing payments for MoviePass, Inc. (‘MoviePass’), which would cause a MoviePass service interruption. Such a service interruption occurred on July 26, 2018.”
This isn’t something the service chose to publicly share with its users:
Also of note is that this is the second outage in July, so this may keep happening.
Needless to say, this isn’t the best news for a company with cash problems that are dinging its stock. But it also says quite a bit that MoviePass can just casually borrow $5 million the same way we borrow $20 off a coworker. If nothing else, it has the financial world’s attention.
(via Business Insider)