Tonight, Donald Trump doing damage control. He's hyping his social media platform. It's called Truth, hyping it because the shares have plunged. The company said it lost over $58 million last year. I mean, it's barely even been public. The stock today down another 5%, despite multiple rants from Trump, including in part, quote, All the competitors to truth social, especially those in the radical left Democrats Party who are failing at every level, like to use their vaunted disinformation machine to try to unconvince people. And it's not easy to do. That truth is not such a big deal. I think truth is It's amazing. First of all, this is the crucial part, and it is very solid, having over $200 million in cash and zero debt. Up front now, Dan Alexander, Forbes senior editor. And Dan, a lot of people are looking at this closely. We're going to see where this story goes because this isn't your normal company that suddenly goes public and goes through the rigor and scrutiny of the legal process prior to that. It was done a bit differently. So let's just start with what Trump is saying here. He's saying it's solid, $200 million in cash, zero debt.

And you say?

Yeah. So if you look at the most recent financials that the company has released, that's as of the end of 2023. And remember, this is a merger between a SPAC company, which was just a pile of cash, and then Trump's company. The pile of Cash had about $293 million in the coffers. So now they've apparently lost a lot of that because that SPAC incurred significant amounts of expenses and legal expenses to try to take this deal public. Secondly, Trump's company was was also taking on major debt because it wasn't making any money. But the way that it was taking on debt was it was taking notes that would convert to equity at huge discounts. So ultimately, what you're looking at for the retail shareholder is that you have less cash than you would have expected, and you have more shareholders diluting everybody else except for the insiders who got in early.

Who got in early. And of course, when you say a special purpose acquisition corporate, basically constructed just to go out and buy something. In this case, it was true social. So Trump's also trying to push popular it is. You have to type it up. Danny's saying he's got seven million followers, and it's good for a startup, very good for a startup, and growing fast. Okay, you look at the comps, you look at this. Is that true?

Seven million is nothing. On Twitter, he had over 80 million followers, and that was just him. The overall company had hundreds of millions of active users. This is a tiny, tiny minnow in an ocean of a social media company. And what's especially troubling for investors is if you look at the growth trajectory of it, it's not adding many users. And so normally, if you had a company that was generating very few revenues and losing money, you would at least expect this huge growth. And here you're not even seeing that. So there's really from a business fundamentals perspective, little reason for hope here.

I mean, it's pretty shocking. In the past few days, you've got two investors in it pleading guilty to insider trading scheme, linked to a deal in this whole process of bringing it public, as you were explaining. The company itself is sued two of its cofounders who were former apprentice participants. Boston Globe ran an op-ed where investment experts compared this IPO to a Ponzi scheme, storied investor in so many successful things, including Expedia. Barry Diller said this. It's a scam, just like everything he's ever been involved in is some con. I mean, that's something to go out and say that. Barry doesn't go and just say that for nothing. Running. What does all this mean for Donald Trump?

Well, the question is how long it takes for retail investors to catch on to the fact that there's nothing there. This is a business that's generating about 700 $150,000 per quarter. It's losing about $5.3 million a year on an operating basis, far more on a net basis. It doesn't have major growth. So Trump, whose shares are locked up, meaning he can't sell them for about six months, is really just hoping to hang on and hope that all this mess, all this infighting, the lawsuits, all the controversy, just doesn't scare people off in the next five and a half or six months. And at that point, that he can somehow tap into his shares, either by leveraging them or selling them.

And get the money. All right, Dan Alexander, thank you so much for explaining. And always good to see you.