Phorm reveals burn rate of $1.8m per month
LONDON - Phorm, the controversial behavioural advertising company which is yet to generate any revenues, is burning through its cash pile at a rate of $1.8m (£1.1m) per month despite slashing its costs.
The burn rate is revealed in the company's latest financial statement, which shows Phorm made a loss of $48m in 2008, going through $3.5m of its cash per month on average.
The company slashed its out goings in the final quarter of 2008, reducing the scale of its US operations and parting company with a number of directors.
It finished 2008 with $23.2m in the bank after raising $65m through an equity placing in March of that year.
It has since raised another $24.2m in a second placing this month, and has no debt.
A rough estimate puts the amount of cash Phorm still has at $37m, which at the current run rate will keep it going for another 20 months.
In its financial report the company admitted it is taking longer to deploy its technology in the UK than originally anticipated, but said it has made "significant progress" in South Korea after a trail with leading ISP Korea Telecom.
Phorm is attempting to improve its consumer reputation after suffering a high-profile backlash in the UK from privacy campaigners angered by its previous secret trials with BT and worried over the extent of its data gathering.
It recently launched new product called Webwise Discover, which is aimed at consumers in a bid to demonstrate its technology can be useful to them.
The product is designed to harness knowledge of users' preferences to make their web browsing more relevant.
The financial statement reveals that Phorm is providing Webwise Discover free of charge to web publishers with no obligation to enter into a commercial advertising relationship, in a bid to demonstrate its potential.
Phorm is currently talking to ISPs in more than 15 markets, including eight of the top ten, as measured by advertising spend.
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