Dan Bilzerian Loses $50 Million on Failing Business Venture4 months ago
Dan Bilzerian’s latest business venture is turning out to be an expensive hobby. The King of Instagram has reportedly seen his new lifestyle company dump $50 million in a single year.
Ignite was set up to use Bilzerian’s image to sell anything and everything party related including cannabis and alcohol. Investors queued up to bankroll the venture assuming that they couldn’t possibly lose given the playboy’s social media following.
On paper it looked like a dream investment, but what they didn’t consider enough was Bilzerian’s lack of business acumen and clear propensity to use company funds as his personal piggy bank.
When Ignite posted the annual report on the Canadian Stock Exchange there must have been a few raised eyebrows. How on earth could they have lost so much in a single year after floating as a publicly traded company.
Forbes Magazine covered the story and dug a little deeper. What they found was quite shocking.
Ignite “made” money in two ways last year. The company issued and sold shares of its company stock, and the company also raised money via debt.
As per its annual filing, Ignite recorded $25 million from “proceeds of issuance of shares,” $19.9 million from “convertible debt,” and $23.7 million from a “short-term promissory note.”
Bilzerian looks to have been spending other people’s money like a drunken sailor with little regard for how useful the purchases were.
The stock price was tanking and yet the spending continued.
The marketing costs were more than double what was recouped in sales. The same situation with basic admin costs.
“Ignite cash went to pay salaries, licensing fees, business expenses, and travel expenses for companies 'owned by the CEO,' according to the report.”
Basically Bilzerian was funding his lifestyle and claiming it was a marketing tool.
We shouldn’t be surprised. The American famously claims to have made his fortune playing high stakes poker but we all know that it really comes from a trust fund his dad set up to funnel his dodgy dealing profits away from law enforcement.
Paul Bilzerian spent time behind bars for numerous offences from his time as a corporate raider on Wall street back in the eighties. By the time the justice system caught up with him the money had been tied in so many knots it was impossible to track all of it down.
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