My Size, Inc. — FY2021 Form 10-K
Reporting period: Fiscal year ended December 31, 2021. The filing is an annual report, not a standalone fourth-quarter report. Financial amounts below are in U.S. dollars unless noted.
Business context
My Size develops smartphone-based measurement software, principally MySizeID for apparel sizing, alongside BoxSize for parcels and SizeUp for DIY measurements. The company reported that MySizeID delivered more than 21 million size recommendations during 2021, but described revenue to date as minimal and said it did not expect meaningful MySizeID revenue during 2022. Customer integrations, pilots and commercial rollouts can take time.
Financial performance and liquidity
| Metric | FY2021 | FY2020 |
|---|---|---|
| Revenue | $131,000 | $142,000 |
| Gross profit | $131,000 | $140,000 |
| Research and development | $4.248 million | $1.523 million |
| Sales and marketing | $2.336 million | $2.196 million |
| General and administrative | $4.124 million | $2.567 million |
| Operating loss | $10.577 million | $6.146 million |
| Net loss | $10.520 million | $6.157 million |
| Basic and diluted loss per share | $0.71 | $1.11 |
| Net cash used in operating activities | $7.297 million | $5.679 million |
- Revenue declined approximately 8% year over year. Cost of revenue was reported as zero in 2021; gross margin was therefore 100% on the reported figures. The 2020 figures imply approximately 99% gross margin.
- Operating loss increased 72%, primarily reflecting higher R&D and general and administrative costs. The $2.618 million share-based charge associated with the 2.5 million shares issued to Shoshana Zigdon was a significant R&D expense.
- Cash, cash equivalents and restricted cash totaled $10.943 million at year-end, versus $1.774 million a year earlier. Cash and cash equivalents alone were $10.670 million. Financing cash flow was $16.292 million, mainly from equity offerings and warrant exercises.
- Total assets were $12.558 million and shareholders’ equity was $10.857 million. The balance sheet reported no conventional borrowings; lease liabilities totaled $611,000, including $138,000 current and $473,000 non-current.
- Accumulated deficit was $45.191 million. The auditor’s opinion was unqualified but included a going-concern explanatory paragraph. Management cited projected losses, negative operating cash flows and uncertainty about cash burn following the Orgad acquisition, and stated that additional capital may be needed.
Material changes and significant items
- Capital raised and dilution: The October 2021 registered direct and PIPE offerings generated approximately $8.5 million gross and $7.56 million net proceeds; purchasers also received five-year warrants. During 2021, the company issued shares in additional public offerings and from warrant exercises. Shares outstanding rose from 7.23 million at December 31, 2020 to 23.98 million at December 31, 2021; 25.38 million were outstanding on March 14, 2022.
- Zigdon agreement: In exchange for 2.5 million shares, Ms. Zigdon waived repurchase and royalty-related rights to measurement assets and intellectual property central to the business.
- Orgad acquisition after year-end: The company acquired Orgad on February 7, 2022. Consideration includes up to $1 million cash, 2,790,049 shares and 10% of Orgad operating profit for 2022 and 2023. Future cash and share installments and earn-outs are subject to conditions, including revenue targets for certain cash payments and seller continued engagement. The 2021 financial statements do not include Orgad’s results.
- Spending and settlements: General and administrative expense included $345,000 in settlement fees, including payments associated with resolving shareholder activism-related disputes. R&D expense rose substantially, mainly due to the Zigdon share issuance.
Outlook, risks and contingencies
- Management did not provide numerical revenue or earnings guidance. It warned that meaningful MySizeID revenue was not expected in 2022 and that customer adoption and timing of commercial rollouts remain uncertain.
- The company has a history of significant losses and relies on external financing. Management said cash on hand was expected to meet obligations, while also disclosing substantial doubt about the company’s ability to continue as a going concern, particularly given uncertain post-acquisition cash needs.
- Nasdaq notified the company in January 2022 that it did not meet the $1 minimum bid-price requirement. The stated initial cure deadline was July 5, 2022; failure to regain compliance could lead to delisting.
- COVID-19 delayed or halted some retail pilots and constrained sales activity. The filing also identifies risks from competition, long sales cycles, privacy and cybersecurity requirements, and operations in Israel and Russia. It discusses the potential impact of Russia’s invasion of Ukraine and related sanctions.
- North Empire litigation remained unresolved: the company sought at least $616,000, while North Empire asserted a counterclaim of approximately $10.96 million. Summary-judgment motions were denied and the company stated it intended to defend the claims. A separate Fidelity Venture Capital claim was dismissed without prejudice in March 2022.
Key facts for investors to verify
- Current cash runway and actual cash burn after incorporating Orgad’s results, acquisition payments and earn-out obligations.
- Whether MySizeID pilots convert into paid, scaled deployments, and how recommendation volume translates into recurring revenue.
- Orgad’s post-acquisition financial contribution, integration costs, revenue-target conditions and potential share issuance schedule.
- Fully diluted share count, warrant exercise terms and potential dilution from outstanding securities and future capital needs.
- Nasdaq bid-price compliance status and developments in the North Empire litigation.