Meeting Software Company Oblong Raises $12 Million

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Meeting Software Company Oblong Raises $12 Million
Downtown-based Oblong Inc. provides remote meeting equipment.

Downtown-based Oblong Inc., which develops remote meeting technology, has raised $12.4 million in a direct offering with institutional investors.
 
Oblong has agreed to sell 4 million shares of its common stock at $3.10 per share, as well as Series A warrants to purchase 1 million additional shares at $4 per share, according to documents filed with the Securities and Exchange commission on June 28. 

The offering is expected to close June 30, and the warrants will be usable starting January 4, 2022.
 
Separately, the company will also sell Series B warrants for 3 million additional shares of common stock at $4.40 per share, which gives its shareholders the chance to purchase shares at that price six months and one day after they are issued.
 
Oblong, which trades on the Nasdaq under the symbol OBLG, did not disclose the participating investors.
 
Oblong, formerly Oblong Industries, offers technology for remote working. 
The company was founded in 2006 and went public in 2019 through a merger with Denver-based video conferencing service Glowpoint Inc. 

Oblong's flagship product, called Mezzanine, is a remote meeting platform that offers simultaneous content sharing for in-person and remote collaborators. 
 
The company is currently transitioning to a subscription-based business model, according to the filing, which it claims could cause a decline in its revenue if not done in a "timely manner."
 
“Our transition to a subscription-based business model entails significant known and unknown risks and uncertainties, and we cannot assure you that we will be able to complete the transition to a subscription-based business model, or manage the transition successfully and in a timely manner,” the company said in the filing.
 
Oblong has not yet been profitable as a public company. In the quarter ending March 31, the company brought in $1.92 million in revenue, a 64% decline from $5.32 million in the same quarter the year before. The company had $3.41 million in net losses for the first quarter, up 15% from $2.97 million in losses in 2020.
 
“We believe that these revenue declines are primarily due to net attrition of customers and lower demand for Glowpoint’s services given the competitive environment and pressure on pricing that exists in our industry,” the company said in the June 28 filing.
 
Despite its losses, the company is set to join the Russell Microcap Index by the end of 2021, which consists of the smallest stocks in the Russell 2,000 index.
Pete Holst, chairman and chief executive of Oblong, said in a statement that the move will give the company “increased visibility within the investment community.”

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