Pre-Revenue OperationsAbsence of recurring revenue means the business lacks a validated commercial model and remains dependent on financing. Over the medium term this structural gap heightens execution risk, limits operating leverage benefits, and prevents internal funding of growth initiatives.
Negative Shareholders' EquityNegative equity signals capital erosion and weak balance-sheet resilience. Durably it impairs borrowing capacity, increases counterparty concerns, and typically forces equity raises or restructuring, which can be dilutive or disruptive to strategic plans and long-term stability.
Persistent Negative Cash FlowOngoing negative operating and free cash flow creates structural financing dependence. Over several months this elevates liquidity and refinancing risk, constrains investment in R&D or commercialization, and increases the likelihood of dilutive capital raises if trends do not reverse.