No Revenue BaseThe absence of any revenue is a structural weakness: without product or service sales the firm cannot self-fund operations or demonstrate product-market fit. Long-term viability depends on building a revenue-generating business or persistent external capital, increasing execution risk.
Negative Shareholders' EquityNegative equity is a durable solvency red flag that constrains financing options, undermines creditor confidence and raises recapitalization or restructuring risk. It often forces dilutive financings or asset sales, weakening long-term shareholder value unless corrected.
Persistent Negative Cash FlowOngoing negative operating and free cash flow means the business relies on external funding to continue. This limits ability to invest in growth, increases vulnerability to capital market conditions, and is a sustained constraint until operating cash generation turns positive.