CREATD, INC., 10-Q filed on 8/13/2021
Quarterly Report
v3.21.2
Document And Entity Information - shares
 6 Months Ended
Jun. 30, 2021
Aug. 13, 2021
Document Information Line Items    
Entity Registrant Name Creatd, Inc.  
Trading Symbol CRTD  
Document Type 10-Q  
Current Fiscal Year End Date --12-31  
Entity Common Stock, Shares Outstanding   13,848,057
Amendment Flag false  
Entity Central Index Key 0001357671  
Entity Current Reporting Status Yes  
Entity Filer Category Non-accelerated Filer  
Document Period End Date Jun. 30, 2021  
Document Fiscal Year Focus 2021  
Document Fiscal Period Focus Q2  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Document Quarterly Report true  
Document Transition Report false  
Entity File Number 001-39500  
Entity Incorporation, State or Country Code NV  
Entity Tax Identification Number 87-0645394  
Entity Address, Address Line One 2050 Center Avenue  
Entity Address, Address Line Two Suite 640  
Entity Address, City or Town Fort Lee  
Entity Address, State or Province NJ  
Entity Address, Postal Zip Code 07024  
City Area Code (201)  
Local Phone Number 258-3770  
Title of 12(b) Security Common Stock, par value $0.001  
Security Exchange Name NASDAQ  
Entity Interactive Data Current Yes  
v3.21.2
Condensed Consolidated Balance Sheets - USD ($)
Jun. 30, 2021
Dec. 31, 2020
Current Assets    
Cash $ 2,124,656 $ 7,906,782
Accounts receivable, net 284,419 90,355
Prepaid expenses and other current assets 888,788 23,856
Total Current Assets 3,297,863 8,020,993
Property and equipment, net 60,412 56,258
Intangible assets 1,493,864 960,611
Goodwill 1,037,992 1,035,795
Deposits and other assets 148,450 191,836
Marketable securities 62,733
Minority investment in business 367,096 217,096
Operating lease right of use asset 199,441 239,158
Total Assets 6,605,118 10,784,480
Current Liabilities    
Accounts payable and accrued liabilities 2,952,353 2,638,688
Derivative liabilities 436,295 42,231
Convertible Notes, net of debt discount and issuance costs 67,048 897,516
Current portion of operating lease payable 95,579 79,816
Note payable - related party, net of debt discount 7,890
Note payable, net of debt discount and issuance costs 1,054,600 1,221,539
Deferred revenue 208,517 88,637
Total Current Liabilities 4,822,282 4,968,427
Non-current Liabilities:    
Note payable 34,036 213,037
Convertible Notes 2,099,400
Operating lease payable 102,231 157,820
Total Non-current Liabilities 2,235,667 370,857
Total Liabilities 7,057,949 5,339,284
Commitments and contingencies
Stockholders’ Equity    
Series E Preferred stock, $0.001 par value, 1,048 and 7,738 shares issued and outstanding, respectively 1 8
Common stock par value $0.001: 100,000,000 shares authorized; 11,857,675 issued and 11,852,018 outstanding as of June 30, 2021 and 8,736,378 issued and 8,727,028 outstanding as of December 31, 2020 11,858 8,737
Additional paid in capital 87,131,333 77,505,013
Subscription receivable (40,000)
Less: Treasury stock, 5,540 and 5,657 shares, respectively (62,406) (62,406)
Accumulated deficit (87,544,953) (71,928,922)
Accumulated other comprehensive income (45,097) (37,234)
Total Creatd, Inc. Stockholders’ Equity (509,264) 5,445,196
Non-controlling interest in consolidated subsidiary 56,433
Total Stockholders' Deficit (452,831) 5,445,196
Total Liabilities and Stockholders’ Equity $ 6,605,118 $ 10,784,480
v3.21.2
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares
Jun. 30, 2021
Dec. 31, 2020
Common stock, par value (in Dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized 100,000,000 100,000,000
Common stock, shares issued 11,857,675 8,736,378
Common stock, shares outstanding 11,852,018 8,727,028
Treasury stock, shares 5,657 5,657
Series E Preferred Stock    
Preferred stock, par value (in Dollars per share) $ 0.001 $ 0.001
Preferred stock, shares issued 1,048 7,738
Preferred stock, shares outstanding 1,048 7,738
v3.21.2
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($)
 3 Months Ended 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Jun. 30, 2021
Jun. 30, 2020
Income Statement [Abstract]        
Net revenue $ 970,857 $ 322,540 $ 1,714,770 $ 615,682
Research and development 56,598 35,705 385,450 171,275
Marketing 4,194,524 422,733 6,237,179 855,564
Stock based compensation 1,940,250 1,602,649 3,510,489 1,994,792
General and administrative 3,160,280 1,796,705 5,908,444 2,955,252
Total operating expenses 9,351,652 3,857,792 16,041,562 5,976,883
Loss from operations (8,380,795) (3,535,252) (14,326,792) (5,361,201)
Other income 14,229 77,785
Interest expense (60,760) (491,206) (259,431) (866,736)
Accretion of debt discount and issuance cost (354,199) (140,274) (851,364) (327,221)
Derivative expense (100,502)
Change In derivative liability (65,442) (262,831)
Impairment of investment (62,733)   (62,733)
Gain (loss) on settlement of vendor liabilities 92,909 (126,087)
Gain on marketable securities 10,042 10,042
Gain (loss) on extinguishment of debt 82,431 470 286,009 (534,570)
Gain on Forgiveness of debt 279,022 279,022
Other expenses, net (181,681) (606,739) (878,921) (1,766,787)
Loss before income tax provision (8,562,476) (4,141,991) (15,205,713) (7,127,988)
Income tax provision
Net loss (8,562,476) (4,141,991) (15,205,713) (7,127,988)
Non-controlling interest in net loss 432 432
Net Loss attributable to Creatd, Inc. (8,562,044) (4,141,991) (15,205,281) (7,127,988)
Deemed dividend (410,750) (410,750)
Net loss attributable to common shareholders (8,972,794) (4,141,991) (15,616,031) (7,127,988)
Net loss (8,562,476) (4,141,991) (15,205,713) (7,127,988)
Currency translation gain (loss) (552) (19,291) (7,863) (28,530)
Comprehensive loss $ (8,563,028) $ (4,161,282) $ (15,213,576) $ (7,156,518)
Basic and diluted loss per share (in Dollars per share) $ (0.81) $ (1.30) $ (1.49) $ (2.28)
Weighted average number of common shares outstanding (in Shares) 11,081,354 3,194,321 10,465,815 3,122,926
v3.21.2
Condensed Consolidated Statement of Changes in Stockholders’ Equity (Deficit) (Unaudited) - USD ($)
Series E
Preferred Stock
Common Stock
Treasury stock
Additional Paid In Capital
Subscription Receivable
Other Comprehensive Income
Non-Controlling Interest
Accumulated Deficit
Total
Balance at Dec. 31, 2019   $ 3,060 $ (367,174) $ 36,391,818   $ (5,995)   $ (44,580,437) $ (8,558,728)
Balance (in Shares) at Dec. 31, 2019   3,059,646 159,850            
Shares Issued with note payable   $ 8 58,928     58,936
Shares Issued with note payable (in Shares)   8,107            
Shares issued for services   $ 50 584,948     584,998
Shares issued for services (in Shares)   50,000            
Coversion of warrants to stock   $ 7 (4,235)     (4,228)
Coversion of warrants to stock (in Shares)   7,239            
Conversion of options to stock   $ 229 1,405,435     1,405,664
Conversion of options to stock (in Shares)   229,491            
Stock warrants issued with note payable   752,138     752,138
Cancellation of Treasury stock   $ (51) $ 349,030 (348,979)    
Cancellation of Treasury stock (in Shares)   (50,650) (151,951)            
Purchase of treasury stock   $ (42,018)     (42,018)
Purchase of treasury stock (in Shares)   14,484            
Shares issued to settle vendor liabilities   $ 24 235,611     235,635
Shares issued to settle vendor liabilities (in Shares)   23,565            
Foreign currency translation adjustments     (28,530)   (28,530)
Net loss       (7,127,988) (7,127,988)
Balance at Jun. 30, 2020   $ 3,327 $ (60,162) 39,075,664   (34,525)   (51,708,425) (12,724,121)
Balance (in Shares) at Jun. 30, 2020   3,327,398 22,383            
Balance at Mar. 31, 2020   $ 3,141 $ (367,174) 37,754,638   (15,234)   (47,566,434) (10,191,063)
Balance (in Shares) at Mar. 31, 2020   3,140,894 159,850            
Shares Issued with note payable   $ 5 27,292     27,297
Shares Issued with note payable (in Shares)   5,424            
Coversion of warrants to stock   $ 2 (10,002)     (10,000)
Coversion of warrants to stock (in Shares)   2,239            
Conversion of options to stock   $ 229 1,405,435     1,405,664
Conversion of options to stock (in Shares)   229,491            
Stock warrants issued with note payable   247,281     247,281
Cancellation of Treasury stock   $ (51) $ 349,030 (348,979)    
Cancellation of Treasury stock (in Shares)   (50,650) (151,951)            
Purchase of treasury stock   $ (42,018)     (42,018)
Purchase of treasury stock (in Shares)   14,484            
Foreign currency translation adjustments     (19,291)   (19,291)
Net loss       (4,141,991) (4,141,991)
Balance at Jun. 30, 2020   $ 3,327 $ (60,162) 39,075,664   (34,525)   (51,708,425) (12,724,121)
Balance (in Shares) at Jun. 30, 2020   3,327,398 22,383            
Balance at Dec. 31, 2020 $ 8 $ 8,737 $ (62,406) 77,505,013 $ (40,000) (37,234) (71,928,922) 5,445,196
Balance (in Shares) at Dec. 31, 2020 7,738 8,736,378 5,657            
Stock based compensation   $ 201   3,410,380         3,410,581
Stock based compensation (in Shares)   201,311              
Stock warrants issued with note payable       1,601,451         1,601,451
Cash received for common   $ 750   2,212,750         2,213,500
Cash received for common (in Shares)   750,000              
Cash received for preferred series E and warrants       (4,225) 40,000       35,775
Cash received for preferred series E and warrants (in Shares) 40                
Shares issued for prepaid services   $ 50   226,450         226,500
Shares issued for prepaid services (in Shares)   50,000              
Shares issued to settle vendor liabilities   $ 45   181,341         181,386
Shares issued to settle vendor liabilities (in Shares)   44,895              
Common stock issued upon conversion of notes payable   $ 121   316,699         316,820
Common stock issued upon conversion of notes payable (in Shares)   120,959              
Exercise of warrants to stock   $ 321   1,272,350         1,272,671
Exercise of warrants to stock (in Shares)   320,693              
Conversion of preferred series E to stock $ (7) $ 1,633   (1,626)          
Conversion of preferred series E to stock (in Shares) (6,730) 1,633,439              
Foreign currency translation adjustments           (7,863)     (7,863)
Non-controlling interest in consolidated subsidiary from acquisition         56,865 56,865
Dividends       410,750       (410,750)  
Net loss             (432) (15,205,281) (15,205,713)
Balance at Jun. 30, 2021 $ 1 $ 11,858 $ (62,406) 87,131,333 (45,097) 56,433 (87,544,953) (452,831)
Balance (in Shares) at Jun. 30, 2021 1,048 11,857,675 5,657            
Balance at Mar. 31, 2021 $ 1 $ 10,925 $ (62,406) 80,633,380 (78,572,159) (44,545)     1,965,196
Balance (in Shares) at Mar. 31, 2021 1,088 10,925,026 5,657            
Stock based compensation   $ 89   2,064,575         2,064,664
Stock based compensation (in Shares)   89,050              
Coversion of warrants to stock $ 18 (18)  
Coversion of warrants to stock (in Shares) 18,259            
Stock warrants issued with note payable 1,601,452   1,601,452
Cash received for common $ 750 2,212,750   2,213,500
Cash received for common (in Shares)   750,000              
Shares issued for prepaid services $ 10 34,490   34,500
Shares issued for prepaid services (in Shares)   10,000              
Common stock issued upon conversion of notes payable $ 56 173,964   174,020
Common stock issued upon conversion of notes payable (in Shares)   55,631            
Conversion of preferred series E to stock $ 10 (10)  
Conversion of preferred series E to stock (in Shares) (40) 9,709            
Foreign currency translation adjustments (552)   (552)
Non-controlling interest in consolidated subsidiary from acquisition   56,865   56,865
Dividends 410,750 (410,750)    
Net loss         (8,562,044)   (432)   (8,562,476)
Balance at Jun. 30, 2021 $ 1 $ 11,858 $ (62,406) $ 87,131,333 $ (45,097) $ 56,433 $ (87,544,953) $ (452,831)
Balance (in Shares) at Jun. 30, 2021 1,048 11,857,675 5,657            
v3.21.2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net loss $ (15,205,713) $ (7,127,988)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 91,042 76,939
Impairment of investment 62,733  
Accretion of debt discount and issuance cost 851,364 327,221
Share-based compensation 3,510,489 1,994,792
Bad debt expense 34,737
Gain on marketable securities (10,042)
Gain on Forgiveness of debt (279,022)
(Gain) loss on settlement of vendor liabilities (92,909) 126,087
Change in fair value of derivative liability 262,831  
Derivative Expense 100,502
(Gain) loss on extinguishment of debt (286,009) 534,570
Non cash lease expense 39,717 34,969
Changes in operating assets and liabilities:    
Prepaid expenses (742,565)
Accounts receivable (186,420) (60,350)
Deposits and other assets 63,356 (2,137)
Deferred revenue 119,209 5,268
Accounts payable and accrued expenses 734,643 1,213,615
Operating lease liability (39,826) (33,064)
Net Cash Used In Operating Activities (10,996,578) (2,885,383)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Cash paid for property and equipment (25,650) (6,339)
Deposits (100,000) (166,283)
Cash paid for minority investment in business (150,000) (30,000)
Cash consideration for acquisition, net (469,768)
Net Cash Used In Investing Activities (745,418) (202,622)
CASH FLOWS FROM FINANCING ACTIVITIES:    
Proceeds from the exercise of warrant 1,312,672
Net proceeds from issuance of notes 199,788 1,349,094
Repayment of notes (276,838) (58,226)
Proceeds from issuance of demand loan 250,000
Proceeds from issuance of convertible note 3,460,491 1,920,460
Repayment of convertible notes (941,880) (75,000)
Proceeds from issuance of note payable - related party 152,989
Repayment of note payable - related party (327,773)
Proceeds from issuance of common stock and warrants 2,213,500
Purchase of treasury stock and warrants (62,018)
Net Cash Provided By Financing Activities 5,967,733 3,149,526
Effect of exchange rate changes on cash (7,863) (28,530)
Net Change in Cash (5,782,126) 32,991
Cash - Beginning of Period 7,906,782 11,637
Cash - End of period 2,124,656 44,628
Cash Paid During the Period for:    
Income taxes
Interest 55,276 55,859
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:    
Settlement of vendor liabilities 168,667 109,548
Warrants issued with debt 1,601,452 752,136
Shares issued with debt 58,935
Issuance of common stock for prepaid services 226,500 585,000
Cancellation of Treasury stock 349,030
Conversion of note payable and interest into convertible notes 385,000
Conversion of Demand loan into notes payable 150,000
Deferred offering costs 4,225
Common stock and warrants issued upon conversion of notes payable $ 316,820
v3.21.2
Organization and Operations
 6 Months Ended
Jun. 30, 2021
Accounting Policies [Abstract]  
Organization and Operations

Note 1 – Organization and Operations

 

Creatd, Inc., formerly Jerrick Media Holdings, Inc. (“we,” “us,” the “Company,” or “Creatd”), is a technology company focused on the development of digital communities, marketing branded digital content, and e-commerce opportunities. Creatd’s content distribution platform, Vocal, delivers a robust long-form, digital publishing platform organized into highly engaged niche-communities capable of hosting all forms of rich media content. Through Creatd’s proprietary algorithm dynamics, Vocal enhances the visibility of content and maximizes viewership, providing advertisers access to target markets that most closely match their interests.

 

The Company was originally incorporated under the laws of the State of Nevada on December 30, 1999 under the name LILM, Inc. The Company changed its name on December 3, 2013 to Great Plains Holdings, Inc. as part of its plan to diversify its business.

 

On February 5, 2016 (the “Closing Date”), GTPH, GPH Merger Sub, Inc., a Nevada corporation and wholly-owned subsidiary of GTPH (“Merger Sub”), and Jerrick Ventures, Inc., a privately-held Nevada corporation headquartered in New Jersey (“Jerrick”), entered into an Agreement and Plan of Merger (the “Merger”) pursuant to which the Merger Sub was merged with and into Jerrick, with Jerrick surviving as a wholly-owned subsidiary of GTPH (the “Merger”). GTPH acquired, pursuant to the Merger, all of the outstanding capital stock of Jerrick in exchange for issuing Jerrick’s shareholders (the “Jerrick Shareholders”), pro-rata, a total of 475,000 shares of GTPH’s common stock. In connection therewith, GTPH acquired 33,415 shares of Jerrick’s Series A Convertible Preferred Stock (the “Jerrick Series A Preferred”) and 8,064 shares of Series B Convertible Preferred Stock (the “Jerrick Series B Preferred”).

 

In connection with the Merger, on the Closing Date, GTPH and Kent Campbell entered into a Spin-Off Agreement (the “Spin-Off Agreement”), pursuant to which Mr. Campbell purchased from GTPH (i) all of GTPH’s interest in Ashland Holdings, LLC, a Florida limited liability company, and (ii) all of GTPH’s interest in Lil Marc, Inc., a Utah corporation, in exchange for the cancellation of 39,091 shares of GTPH’s Common Stock held by Mr. Campbell. In addition, Mr. Campbell assumed all debts, obligations and liabilities of GTPH, including any existing prior to the Merger, pursuant to the terms and conditions of the Spin-Off Agreement.

 

Upon closing of the Merger on February 5, 2016, the Company changed its business plan to that of Jerrick.

 

Effective February 28, 2016, GTPH entered into an Agreement and Plan of Merger (the “Statutory Merger Agreement”) with Jerrick, pursuant to which GTPH became the parent company of Jerrick Ventures, LLC, a wholly-owned operating subsidiary of Jerrick (the “Statutory Merger”) and GTPH changed its name to Jerrick Media Holdings, Inc. to better reflect its new business strategy.

 

On September 11, 2019, the Company acquired 100% of the membership interests of Seller’s Choice, LLC, a New Jersey limited liability company (“Seller’s Choice”). Seller’s Choice is a digital e-commerce agency based in New Jersey (see Note 4).

 

On September 9, 2020, the Company filed a certificate of amendment with the Secretary of State of the State of Nevada to change our name to “Creatd, Inc.”, which became effective on September 10, 2020. 

 

On June 4, 2021, the Company acquired 89% of the membership interests of Plant Camp, LLC, a Delaware limited liability company (“Plant Camp”). Plant Camp is a CPG company that creates healthy upgrades to kid-friendly foods.
v3.21.2
Significant Accounting Policies and Practices
 6 Months Ended
Jun. 30, 2021
Accounting Policies [Abstract]  
Significant Accounting Policies and Practices

Note 2 – Significant Accounting Policies and Practices

 

Management of the Company is responsible for the selection and use of appropriate accounting policies and the appropriateness of accounting policies and their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The Company’s significant and critical accounting policies and practices are disclosed below as required by the accounting principles generally accepted in the United States of America.

 

Basis of Presentation

 

The Company’s condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and following the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These interim financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or any other interim period or for any other future year. These unaudited condensed financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2020, included in the Company’s 2020 Annual Report on Form 10-K filed with the SEC. The balance sheet as of December 31, 2020 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements.

 

Use of Estimates and Critical Accounting Estimates and Assumptions

 

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

 

These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value.

 

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

 

Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly.

 

Actual results could differ from those estimates.

 

Principles of consolidation

 

The Company consolidates all majority-owned subsidiaries, if any, in which the parent’s power to control exists.

 

As of June 30, 2021, the Company’s consolidated subsidiaries and/or entities are as follows:

 

Name of combined affiliate  State or other
jurisdiction of
incorporation
or organization		  Company
Ownership
Interest		 
Jerrick Ventures LLC  Delaware   100%
Abacus Tech Pty Ltd  Australia   100%
Seller’s Choice, LLC  New Jersey   100%
Recreatd, LLC  Delaware   100%
Give, LLC  Delaware   100%
Creatd Partners LLC  Delaware   100%
Plant Camp LLC  Delaware   89%
Sci-Fi Shop, LLC  Delaware   100%
OG Collection LLC  Delaware   100%
VMENA LLC  Delaware   100%
Vocal For Brands, LLC  Delaware   100%
Vocal Ventures LLC  Delaware   100%
What to Buy, LLC  Delaware   100%

 

All inter-company balances and transactions have been eliminated.

 

Fair Value of Financial Instruments

 

The fair value measurement disclosures are grouped into three levels based on valuation factors:

 

  ● Level 1 – quoted prices in active markets for identical investments

 

  ● Level 2 – other significant observable inputs (including quoted prices for similar investments and market corroborated inputs)

 

  ● Level 3 – significant unobservable inputs (including our own assumptions in determining the fair value of investments)

 

The Company’s Level 1 assets/liabilities include cash, accounts receivable, marketable trading securities, accounts payable, prepaid and other current assets, line of credit and due to related parties. Management believes the estimated fair value of these accounts at June 30, 2021 approximate their carrying value as reflected in the balance sheets due to the short-term nature of these instruments or the use of market interest rates for debt instruments.

 

The Company’s Level 2 assets/liabilities include certain of the Company’s notes payable and capital lease obligations. Their carrying value approximates their fair values based upon a comparison of the interest rate and terms of such debt given the level of risk to the rates and terms of similar debt currently available to the Company in the marketplace.

 

The Company’s Level 3 assets/liabilities include goodwill, intangible assets, marketable debt securities, equity investments at cost, and derivative liabilities, when they are recorded at fair value due to an impairment charge. Inputs to determine fair value are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models. Unobservable inputs used in the models are significant to the fair values of the assets and liabilities. 

 

The following table provides a summary of the relevant assets and liabilities that are measured at fair value on recurring basis:

 

Fair Value Measurements as of

June 30, 2021

 

   Total   Quoted
Prices in
Active
Markets for
Identical
Assets or
Liabilities
(Level 1)		   Quoted
Prices for
Similar
Assets or
Liabilities
in Active
Markets
(Level 2)		   Significant
Unobservable
Inputs
(Level 3)		 
Assets:                
Marketable securities - debt securities  $
-
   $
      -
   $
      -
   $
-
 
Total assets  $
-
   $
-
   $
-
   $
-
 
                     
Liabilities:                    
Derivative liabilities  $436,295   $
-
   $
-
   $436,295 
Total Liabilities   436,295   $
-
   $
-
   $436,295 

 

The following table shows the valuation methodology and unobservable inputs for Level 3 assets and liabilities measured at fair value on recurring basis as of June 30, 2021:

 

   Fair Value   Valuation Methodology    Unobservable Inputs  
Marketable securities - debt securities  $
-
   Discounted cash flow analysis    Expected cash flows from the investment  
                
Derivative liabilities  $436,295   Monte Carlo simulations and Binomial model   

Risk free rate

 

Expected volatility; Drift rate

  

 

The following table provides a summary of the relevant assets that are measured at fair value on non-recurring basis:

 

Fair Value Measurements as of

June 30, 2021

 

   Total   Quoted
Prices in
Active
Markets for
Identical
Assets or
Liabilities
(Level 1)		   Quoted
Prices for
Similar
Assets or
Liabilities
in Active Markets
(Level 2)		   Significant
Unobservable
Inputs
(Level 3)		 
Assets:                
Equity investments, at cost  $367,096   $
      -
   $
      -
   $367,096 
Total assets  $367,096   $
-
   $
-
   $367,096 

 

The following table shows the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on non-recurring basis as of June 30, 2021:

 

   Fair Value   Valuation Methodology    Unobservable Inputs  
Equity investments, at cost  $367,096   Qualitative assessment per ASC 321-10-35    Qualitative factors  

 

The Company valued the initial value of debt securities, which are investments in convertible notes receivable, by assessing the separate values of the debt and equity components for similar instruments convertible into private company equity (Level 3). The investment was initially measured at cost, which was determined to approximate fair value due to the lack of marketability of the conversion shares underlying these convertible instruments and the expected recoverability of the note principal. The key assumption affecting the level 3 fair values would be collectability of the notes. The Company monitors for impairment indicators at each balance sheet date.

 

Cash Equivalents

 

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

 

At times, cash balances may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurable limits. The Company has never experienced any losses related to these balances. As of June 30, 2021, and December 31, 2020, cash amounts in excess of $250,000 were not fully insured. The uninsured cash balance as of June 30, 2021 was approximately $1.9 million. The Company does not believe it is exposed to significant credit risk on cash and cash equivalents.

 

Long-lived Assets Including Goodwill and Other Acquired Intangibles Assets

 

We evaluate the recoverability of property and equipment and acquired finite-lived intangible assets for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. The evaluation is performed at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability of these assets is measured by a comparison of the carrying amounts to the future undiscounted cash flows the assets are expected to generate from the use and eventual disposition. If such review indicates that the carrying amount of property and equipment and intangible assets is not recoverable, the carrying amount of such assets is reduced to fair value. We have not recorded any impairment charges for these type of assets during the six months ended June 30, 2021.

 

Acquired finite-lived intangible assets are amortized on a straight-line basis over the estimated useful lives of the assets. We routinely review the remaining estimated useful lives of property and equipment and finite-lived intangible assets. If we change the estimated useful life assumption for any asset, the remaining unamortized balance is amortized or depreciated over the revised estimated useful life.

 

During the year ended December 31, 2020 the Company completed its annual impairment test of goodwill. The Company performed the qualitative assessment as permitted by ASC 350-20 and determined that the fair value of the reporting unit was more likely than not equal or greater than the carrying value, including Goodwill. Based on completion of this annual impairment test, no impairment was indicated.

 

Investments

 

Marketable securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and are reported at fair value, with unrealized gains and losses recognized in earnings. Debt securities not classified as held-to-maturity or as trading are classified as available-for-sale, and are carried at fair market value, with the unrealized gains and losses, net of tax, included in the determination of comprehensive income and reported in stockholders’ equity.

 

The Company accounts for its investments in available-for-sale debt securities, in accordance with sub-topic 320-10 of the FASB ASC (“Sub-Topic 320-10”). Accrued interest on these securities is included in fair value and amortized cost.

 

Pursuant to Paragraph 320-10-35, investments in debt securities that are classified as available for sale shall be measured subsequently at fair value in the statement of financial position. Unrealized holding gains and losses for available-for-sale securities (including those classified as current assets) shall be excluded from earnings and reported in other comprehensive income until realized.

 

The Company follows FASB ASC 320-10-35 to assess whether an investment in debt securities is impaired in each reporting period. An investment in debt securities is impaired if the fair value of the investment is less than its amortized cost. If the Company intends to sell the debt security (that is, it has decided to sell the security), an other-than-temporary impairment shall be considered to have occurred. If the Company more likely than not will be required to sell the security before recovery of its amortized cost basis or it otherwise does not expect to recover the entire amortized cost basis of the security, an other-than-temporary impairment shall be considered to have occurred. The Company considers the expected cash flows from the investment based on reasonable and supportable forecasts as well as several other factors to estimate whether a credit loss exists. If the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, the other-than-temporary impairment shall be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date.

 

The following table sets forth a summary of the changes in marketable securities - available-for-sale debt securities that are measured at fair value on a recurring basis:

 

   For the
three and
six months ended
June 30,
2021		 
   Total 
Beginning of period  $62,733 
Purchase of marketable securities   - 
Interest due at maturity   - 
Other than temporary impairment   (62,733)
Conversion of marketable securities   - 
June 30, 2021  $- 

 

We invest in debt securities. Our investments in debt securities are subject to interest rate risk. To minimize the exposure due to an adverse shift in interest rates, we invest in securities with maturities of two years or less and maintain a weighted average maturity of one year or less. As of June 30, 2021, all of our investments had maturities between one and three years. The marketable debt security investments are evaluated for impairment if events or circumstances arise that indicate that the carrying amount of such assets may not be recoverable. During the three and six months ended June 30, 2021 the Company recognized a $62,733 impairment of the debt security.

 

The following table sets forth a summary of the changes in equity investments, at cost that are measured at fair value on a non-recurring basis: 

 

   For the
three months ended
June 30,
2021		   For the
six months ended
June 30,
2021		 
   Total   Total 
Beginning of period  $317,096   $217,096 
Purchase of equity investments   50,000    150,000 
June 30, 2021  $367,096   $367,096 

 

The Company has elected to measure its equity securities without a readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. An election to measure an equity security in accordance with this paragraph shall be made for each investment separately.

 

The Company performed a qualitative assessment considering impairment indicators to evaluate whether these investments were impaired. Impairment indicators that the Company considered included the following: a) a significant deterioration in the earnings performance, credit rating, asset quality or business prospects of the investee; b) a significant adverse change in the regulatory, economic or technology environment of the investee; c) a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates; d) a bona fide offer to purchase or an offer by the investee to sell the investment; e) factors that raise significant concerns about the investee’s ability to continue as a going concern.

 

Commitments and Contingencies

 

The Company follows subtopic 450-20 of the FASB ASC to report accounting for contingencies. Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

 

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

 

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

 

Foreign Currency

 

Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at our Consolidated Balance Sheet dates. Results of operations and cash flows are translated using the average exchange rates throughout the periods. The effect of exchange rate fluctuations on the translation of assets and liabilities is included as a component of stockholders’ equity in accumulated other comprehensive income. Gains and losses from foreign currency transactions, which are included in operating expenses, have not been significant in any period presented.

 

Derivative Liability

 

The Company evaluates its debt and equity issuances to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 815-10-05-4 and Section 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation and then the related fair value is reclassified to equity.

 

In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. 

 

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date.

 

The Company adopted Section 815-40-15 of the FASB Accounting Standards Codification (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The Company changed its method of accounting for the debt and warrants through the early adoption of ASU 2017-11 during the three months ended December 31, 2017, on a retrospective basis.

 

The Company utilizes a Monte Carlo simulation model for the make whole feature and a binomial option model for convertible notes that have an option to convert at a variable number of shares to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The inputs utilized in the application of the Monte Carlo model included a starting stock price, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, drift, and a risk-free rate. The inputs utilized in the application of the Binomial model included a stock price on valuation date, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, and a risk-free rate. The Company records the change in the fair value of the derivative as other income or expense in the consolidated statements of operations.

 

Revenue Recognition

 

Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

 

We determine revenue recognition through the following steps:

 

  ● identification of the contract, or contracts, with a customer;

 

  ● identification of the performance obligations in the contract;

 

  ● determination of the transaction price. The transaction price for any given subscriber could decrease based on any payments made to that subscriber. A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mile basis) and cash prizes offered to Challenge winners;

 

  ● allocation of the transaction price to the performance obligations in the contract; and

 

  ● recognition of revenue when, or as, we satisfy a performance obligation.

 

Revenue disaggregated by revenue source for the three and six months ended June 30, 2021 and 2020 consists of the following:

 

   Three Months Ended   Six Months Ended 
   June 30,   June 30, 
   2021   2020   2021   2020 
Agency (Managed Services + Branded Content)  $488,836   $258,834   $917,136   $507,085 
Platform (Creator Subscriptions)   451,965    54,972    758,867    90,934 
Ecommerce   5,526    
-
    5,526    
-
 
Affiliate Sales   7,798    8,195    15,806    16,344 
Other Revenue   16,732    539    17,435    1,319 
   $970,857   $322,540   $1,714,770   $615,682 

 

Timing of revenue recognition for the three and six months ended June 30, 2021 and 2020 consists of the following:

 

   Three Months Ended   Six Months Ended 
   June 30,   June 30, 
   2021   2020   2021   2020 
Products and services transferred over time  $940,801   $313,806   $1,676,003   $598,019 
Products transferred at a point in time   30,056    8,734    38,767    17,663 
   $970,857   $322,540   $1,714,770   $615,682 

  

Agency Revenue

 

Managed Services

The Company provides Studio/Agency Service offerings to business-to-business (B2B) and business-to-consumer (B2C) product and service brands which encompasses a full range of digital marketing and e-commerce solutions. The Company’s services include the setup and ongoing management of clients’ websites, Amazon and Shopify storefronts and listings, social media pages, search engine marketing, and other various tools and sales channels utilized by e-commerce sellers for sales and growth optimization. Contracts are broken into three categories: Partners, Monthly Services, and Projects. Contract amounts for Partner and Monthly Services clients range from approximately $500-$7,500 per month while Project amounts vary depending on the scope of work. Partner and Monthly clients are billed monthly for the work completed within that month. Partner Clients may or may not have an additional billing component referred to as Sales Performance Fee, which is a fee based upon a previously agreed upon percentage point of the client’s total sales for the month. Some Partners may also have projects within their contracts that get billed and recognized as agreed upon project milestones are achieved. Revenue is recognized over time as service obligations and milestones in the contract are met.

Branded Content

 

Branded content represents the revenue recognized from the Company’s obligation to create and publish branded articles for clients on the Vocal platform and promote said stories, tracking engagement for the client. The performance obligation is satisfied when the Company successfully publishes the articles on its platform and meets any required promotional milestones as per the contract. The revenue is recognized over time as the services are performed and any required milestones are met.

 

Below are the significant components of a typical agreement pertaining to branded content revenue:

 

  ● The Company collects fixed fees ranging from $10,000 to $110,000.
     
  ● The articles are created and published within three months of the signed agreement, or as previously negotiated with the client.
     
  ● The articles are promoted per the contract and engagement reports are provided to the client.
     
  ● Most billing for contracts occurs 50% at signing and 50% upon completion of the services, with net payment terms varying per client.
     
  ● Most contracts include provisions for clients to acquire content rights at the end of the campaign for a flat fee. 

 

Platform Revenue

 

Creator Subscriptions

 

Vocal+ is a premium subscription offering for Vocal creators. In addition to joining for free, Vocal creators now have the option to sign up for a Vocal+ membership for either $9.99 monthly or $99 annually, though these amounts are occasionally subject to promotional discounts. Vocal+ subscribers receive access to value-added features such as increased rate of cost per mille (thousand) (“CPM”) monetization, a decreased minimum withdrawal threshold, a discount on platform processing fees, member badges for their profiles, access to exclusive Vocal+ Challenges, and early access to new Vocal features. Subscription revenues stem from both monthly and annual subscriptions, the latter of which is amortized over a twelve-month period. Any customer payments received are recognized over the subscription period, with any payments received in advance being deferred until they are earned.

 

The transaction price for any given subscriber could decrease based on any payments made to that subscriber. A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mille basis) and cash prizes offered to Challenge winners. Estimates are utilized for payments made for earnings through reads, by establishing the lifetime a subscriber has had a Vocal account, determining the percentage of that lifetime that the subscriber has been a paying customer, and applying that percentage to payments for earnings through reads in the relevant reporting period.

 

Affiliate Sales Revenue

 

Affiliate sales represents the commission the Company receives when a purchase is made through affiliate links placed within content hosted on the Vocal platform. Affiliate revenue is earned on a “click through” basis, upon referring visitors, via said links, to an affiliate’s site and having them complete a specific outcome, most commonly a product purchase. The Company uses multiple affiliate platforms, such as Skimlinks, Amazon, and Tune, to form and maintain thousands of vendor relationships. Each vendor establishes their own commission percentage, which typically range from 2-20%. The revenue is recognized upon receipt as reliable estimates could not be made.

 

E-Commerce Revenue

 

The Company generates revenue through the sale of consumer products through its e-commerce distribution channels. The Company satisfies its performance obligation upon receipt of product by its customers.

Deferred Revenue

 

Deferred revenue consists of billings and payments from clients in advance of revenue recognition. As of June 30, 2021, and December 31, 2020, the Company had deferred revenue of $208,517 and $88,637, respectively.

 

Accounts Receivable and Allowances

 

Accounts receivable are recorded and carried when the Company has performed the work in accordance with managed services, project, partner, consulting and branded content agreements. For example, we bill a managed service client monthly when we have updated their Amazon store, modified SEO or completed the other services listed in the agreement. For projects and branded content, we will bill the client and record the receivable once milestones are reached that are set in the agreement. We make estimates for the allowance for doubtful accounts and allowance for unbilled receivables based upon our assessment of various factors, including historical experience, the age of the accounts receivable balances, credit quality of our customers, current economic conditions, and other factors that may affect our ability to collect from customers. During the six months ended June 30, 2021, the Company recorded $0 as a bad debt expense. As of June 30, 2021, and December 31, 2020, the Company has an allowance for doubtful accounts of $76,340 and $80,509, respectively.

 

Stock-Based Compensation

 

The Company recognizes compensation expense for all equity–based payments granted in accordance with Accounting Standards Codification (“ASC”) 718 “Compensation – Stock Compensation”. Under fair value recognition provisions, the Company recognizes equity–based compensation net of an estimated forfeiture rate and recognizes compensation cost only for those shares expected to vest over the requisite service period of the award.

 

Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods.

 

The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the value of the underlying share, the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is benchmarked against similar companies in a similar industry over the expected option life and other appropriate factors. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on its Common stock and does not intend to pay dividends on its Common stock in the foreseeable future. The expected forfeiture rate is estimated based on management’s best estimate. 

 

Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, our equity–based compensation could be materially different in the future. The Company issues awards of equity instruments, such as stock options and restricted stock units, to employees and certain non-employee directors. Compensation expense related to these awards is based on the fair value of the underlying stock on the award date and is amortized over the service period, defined as the vesting period, using the cliff straight-line method. The vesting period is generally one to three years. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant is used for restricted stock units. Compensation expense is reduced for actual forfeitures as they occur.

 

Loss Per Share

 

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case for the three and six months ended June 30, 2021 and 2020 presented in these condensed consolidated financial statements, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

 

The Company had the following common stock equivalents at June 30, 2021 and 2020:

 

   June 30, 
   2021   2020 
Options   2,363,187    452,523 
Warrants   7,496,070    936,240 
Convertible notes - related party   
-
    5,574 
Convertible notes   1,008,798    1,562,138 
Totals   10,868,055    2,956,475 

 

Reclassifications

 

Certain prior year amounts in the consolidated financial statements and the notes thereto have been reclassified where necessary to conform to the current year's presentation. These reclassifications did not affect the prior period's total assets, total liabilities, stockholders’ deficit, net loss or net cash used in operating activities.

 

Recently Adopted Accounting Guidance

 

In December 2019, the FASB issued authoritative guidance intended to simplify the accounting for income taxes (ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”). This guidance eliminates certain exceptions to the general approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes. This guidance is effective for annual periods after December 15, 2020, including interim periods within those annual periods. The updated guidance, which became effective for fiscal years beginning after December 15, 2020, did not have a material impact on the Company’s condensed consolidated financial statements.

 

Recent Accounting Guidance Not Yet Adopted

 

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments (“ASU-2016-13”). ASU 2016-13 affects loans, debt securities, trade receivables, and any other financial assets that have the contractual right to receive cash. The ASU requires an entity to recognize expected credit losses rather than incurred losses for financial assets. ASU 2016-13 is effective for the fiscal year beginning after December 15, 2022, including interim periods within that fiscal year. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

 

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU amends the guidance on convertible instruments and the derivatives scope exception for contracts in an entity’s own equity, and also improves and amends the related EPS guidance for both Subtopics. The ASU will be effective for annual reporting periods after December 15, 2021, and interim periods within those annual periods and early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

 

In May 2021, the FASB issued authoritative guidance intended to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. (ASU 2021-04), “Derivatives and Hedging Contracts in Entity’s Own Equity (Topic 815). This guidance amendments provide measurement, recognition, and disclosure guidance for an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. This guidance is effective for annual periods after December 15, 2021, including interim periods within those annual periods. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

 

Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying condensed consolidated financial statements.
v3.21.2
Going Concern
 6 Months Ended
Jun. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Going Concern

Note 3 – Going Concern

 

The Company’s condensed consolidated financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.

 

As reflected in the condensed consolidated financial statements, as of June 30, 2021, the Company had an accumulated deficit of $87.5 million, a net loss of $15.2 million and net cash used in operating activities of $11 million for the reporting period then ended. The Company is in default on debentures as of the date of this filing. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements.

 

On January 30, 2020, the World Health Organization declared the COVID-19 novel coronavirus outbreak a “Public Health Emergency of International Concern” and on March 10, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of the coronavirus include restrictions on travel, and quarantines in certain areas, and forced closures for certain types of public places and businesses. The COVID-19 coronavirus and actions taken to mitigate it have had and are expected to continue to have an adverse impact on the economies and financial markets of many countries, including the geographical area in which the Company operates. While it is unknown how long these conditions will last and what the complete financial impact will be to the Company, capital raising efforts and our operations may be negatively affected.

 

The Company is attempting to further implement its business plan and generate sufficient revenues; however, its cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to further implement its business plan and generate sufficient revenues and in its ability to raise additional funds by way of a public or private offering of its debt or equity securities, there can be no assurance that it will be able to do so on reasonable terms, or at all. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business plan and generate sufficient revenues and its ability to raise additional funds by way of a public or private offering. 

 

The condensed consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
v3.21.2
Equity Investments, at Cost
 6 Months Ended
Jun. 30, 2021
Investment Holdings [Abstract]  
Equity investments, at cost

Note 4 – Equity investments, at cost

 

The Company has elected to measure its equity securities without a readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. An election to measure an equity security in accordance with this paragraph shall be made for each investment separately.

 

The Company performed a qualitative assessment considering impairment indicators to evaluate whether these investments were impaired. Impairment indicators that the Company considered included the following: a) a significant deterioration in the earnings performance, credit rating, asset quality or business prospects of the investee; b) a significant adverse change in the regulatory, economic or technology environment of the investee; c) a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates; d) a bona fide offer to purchase or an offer by the investee to sell the investment; e) factors that raise significant concerns about the investee’s ability to continue as a going concern.

 

On October 2, 2020, the Company converted $102,096 of its marketable debt security into 119,355 shares of preferred stock or a 1.3% equity investment in a private company.

 

On October 23, 2020, the Company entered into an equity interest purchase agreement whereas the Company purchased 3.8% ownership of a private company for $115,000.

 

On February 17, 2021, the Company entered into a membership interest purchase agreement whereas the Company purchased another 3.3% ownership of a private company for $100,000.

 

On May 21, 2021, the Company entered into a common stock purchase agreement whereas the Company purchased 10.0% ownership of a private company for $50,000.

 

On May 27, 2021, the Company made a deposit of $110,000 towards future ownership in a private company. As of June 30, 2021, had no voting control nor equity in the private company related to this deposit.
v3.21.2
Notes Payable
 6 Months Ended
Jun. 30, 2021
Debt Disclosure [Abstract]  
Notes Payable

Note 5 – Notes Payable

 

Notes payable as of June 30, 2021 and December 31, 2020 is as follows:

 

   Outstanding Principal as of         
   June 30,
2021		   December 31,
2020		   Interest
Rate		   Maturity
Date		 
Seller’s Choice Note  $660,000   $660,000    30%  September 2020 
The May 2020 PPP Loan Agreement   252,432    412,500    1%  April 2022 
The April 2020 PPP Loan Agreement   
-
    282,432    1%  May 2022 
The October 2020 Loan Agreement   56,796    55,928    14%  July 21 
The November 2020 Loan Agreement   
-
    23,716    14%  May 2021 
The February 2021 Loan Agreement   85,372    
-
    14%  July 21 
The April 2021 Loan Agreement   41,585    
-
    10%  October 22 
    1,096,185    1,434,576          
Less: Debt Discount   (7,549)   
-
               
Less: Debt Issuance Costs   
-
    
-
          
    1,088,636    1,434,576          
Less: Current Debt   (1,054,600)   (1,221,539)         
Total Long-Term Debt  $34,036   $213,037          

 

Seller’s Choice Note

 

On September 11, 2019, the Company entered into Seller’s Choice Purchase Agreement with Home Revolution LLC (see Note 4). As a part of the consideration provided pursuant to the Seller’s Choice Acquisition, the Company issued the Seller’s Choice Note to the Seller in the principal amount of $660,000. The Seller’s Choice Note bears interest at a rate of 9.5% per annum and is payable on March 11, 2020 (the “Seller’s Choice Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts become due. Upon maturity the Company utilized an automatic extension up to 6 months. This resulted in a 5% increase in the interest rate every month the Seller’s Choice Note is outstanding. As of June 30, 2021, the Company is in default on the Seller’s Choice note.

 

During the six months ended June 30, 2021, the Company accrued interest of $98,186.

The April 2020 PPP Loan Agreement

 

On April 30, 2020, the Company was granted a loan with a principal amount of $282,432 (the “Loan”), pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which was enacted on March 27, 2020. The Loan, which was in the form of a Note dated April 30, 2020, matures on April 30, 2022, and bears interest at a fixed rate of 1.00% per annum, payable monthly commencing on October 30, 2020. The Note may be prepaid by the Company at any time prior to maturity without payment of any premium. Funds from the Loan may only be used to retain workers and maintain payroll or make mortgage payments, lease payments and utility payments.

 

During the six months ended June 30, 2021, the Company accrued interest of $1,145.

 

During the six months ended June 30, 2021, the Company repaid $30,000 in principal.

 

The Company is in the process of returning the funds received from the Loan.

 

When the applications for PPP first opened up, there was limited available funding and much confusion surrounding the application process. The Company initially submitted its application for the May 2020 PPP Loan in early April but received no response in the aftermath of submitting the application. After consulting multiple advisors, the Company made the decision to apply elsewhere, due to the rampant media coverage of institutions running out of funding and the Company’s need for the capital and belief that if 2 separate loans were approved, the remaining application could simply be withdrawn.

 

Therefore, in late April, the company proceeded with applying for the April 2020 PPP Loan. After some conflicting communications regarding acceptance, the Company attempted to contact the lender to clarify but got no response. After continued attempts to follow up with both lenders, the Company received approval for the May 2020 PPP Loan and funding for the April 2020 PPP Loan on the same day, followed the next day by the funding of the May 2020 PPP Loan. The Company immediately separated the funds for the April 2020 PPP Loan into a separate reserved bank account with the intention of returning the funds. However, after several attempts to contact the lender with no response, the Company was faced with difficulty raising funds in the early-Covid economy and made the decision to utilize the funds for operations and pursue an installment repayment plan when they were able to reach the lender. As of the date of this filing, the Company has begun making repayments on the loan, absent a formal installment agreement due to difficulties reaching the lender. The Company intends to complete repayment before the end of 2021.

 

As each company is only permitted one loan under the CARES Act, there is a possibility the loan may be called by the SBA and the Company would have to repay the loan in full at such time.

 

The May 2020 PPP Loan Agreement

 

On May 4, 2020, Jerrick Ventures, LLC (“Jerrick Ventures”), the Company’s wholly-owned subsidiary, was granted a loan from PNC Bank, N.A. with a principal amount of $412,500, pursuant to the Paycheck Protection Program (the “PPP”). The Loan, which was in the form of a Note dated May 4, 2020, matures on May 4, 2022, and bears interest at a fixed rate of 1.00% per annum, payable monthly commencing on November 4, 2020. The Note may be prepaid by Jerrick Ventures at any time prior to maturity without payment of any premium. Funds from the Loan may only be used to retain workers and maintain payroll or make mortgage payments, lease payments and utility payments. Jerrick Ventures intends to use the entire Loan amount for qualifying expenses. Under the terms of the PPP, certain amounts of the Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act. 

 

During the six months ended June 30, 2021, the Company accrued interest of $1,017. 

 

During the six months ended June 30, 2021, the Company repaid $136,597 in principal and was forgiven $275,903 of principal and $3,119 of accrued interest.

 

The October 2020 Loan Agreement

 

On October 6, 2020, the Company entered into a secured loan agreement (the “October 2020 Loan Agreement”) with a lender (the “October 2020 Lender”), whereby the October 2020 Lender issued the Company a secured promissory note of A$74,300 AUD or $56,796 United States Dollars (the “October 2020 Note”). Pursuant to the October 2020 Loan Agreement, the October 2020 Note has an effective interest rate of 14%. The maturity date of the October 2020 Note is September 30, 2021 (the “October 2020 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the October 2020 Loan Agreement are due. The loan is secured by the Australian research & development credit.

 

During the six months ended June 30, 2021, the Company accrued A$5,158 in interest. 

 

The November 2020 Loan Agreement

 

On November 24, 2020, the Company entered into a loan agreement (the “November 2020 Loan Agreement”) with a lender (the “November 2020 Lender”) whereby the November 2020 Lender issued the Company a promissory note of $34,000 (the “November 2020 Note”). Pursuant to the November 2020 Loan Agreement, the November 2020 Note has an effective interest rate of 14%. The maturity date of the November 2020 Note is May 25, 2021 (the “November 2020 Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under the November 2020 Note are due.

 

During the six months ended June 30, 2021, the Company repaid $23,716 in principal and $4,736 of accrued interest.

 

The February 2021 Loan Agreement

 

On February 24, 2021, the Company entered into a secured loan agreement (the “February 2021 Loan Agreement”) with a lender (the “February 2021 Lender”), whereby the February 2021 Lender issued the Company a secured promissory note of A$111,683 AUD or $85,372 United States Dollars (the “February 2021 Note”). Pursuant to the February 2021 Loan Agreement, the February 2021 Note has an effective interest rate of 14%. The maturity date of the February 2021 Note is July 31, 2021 (the “February 2021 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the February 2021 Loan Agreement are due. The loan is secured by the Australian research & development credit.

 

During the six months ended June 30, 2021, the Company accrued A$ 5,398 in interest. 

 

The April 2021 Loan Agreement

 

On April 9, 2021, the Company entered into a loan agreement (the “April 2021 Loan Agreement”) with a lender (the “April 2021 Lender”) whereby the April 2021 Lender issued the Company a promissory note of $128,110 (the “April 2021 Note”). Pursuant to the April 2021 Loan Agreement, the April 2021 Note has an effective interest rate of 11%. The maturity date of the April 2021 Note is October 8, 2022 (the “April 2021 Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under the April 2021 Note are due.

 

During the six months ended June 30, 2021, the Company repaid $86,525 in principal.
v3.21.2
Convertible Note Payable
 6 Months Ended
Jun. 30, 2021
Convertible Note Payable [Abstract]  
Convertible Note Payable

Note 6 – Convertible Note Payable

 

Convertible notes payable as of June 30, 2021, and December 31, 2020 is as follows:

 

   Outstanding Principal as of               Warrants granted 
  

June 30,

2021

  

December 31,

2020

  

Interest

Rate

  

Conversion

Price

   

Maturity

Date

 

Quantity

  

Exercise

Price

 
The September 2020 convertible Loan Agreement  $
-
   $341,880    12%   
      -
 (*)   September-21   85,555          5 
The First December 2020 convertible Loan Agreement   
-
    600,000    12%   
-
 (*)   December-21   
-
    
-
 
The October 2020 convertible Loan Agreement   
-
    169,400    6%   
-
 (*)   October-21   
-
    
-
 
The Second December 2020 convertible Loan Agreement   169,400    169,400    6%   
-
 (*)   December-21   
-
    
-
 
The May 2021 Loan   4,666,669    
-
    
-
%   5.00 (*)   November-22   1,090,908    4.50-  
    4,836,069    1,280,680                         
Less: Debt Discount   (2,174,294)   (309,637)                        
Less: Debt Issuance Costs   (495,327)   (73,527)                        
    2,166,448    897,516                         
Less: Current Debt   (67,048)   (897,516)                        
Total Long-Term Debt  $2,099,400   $
-
                         

(*) As subject to adjustment as further outlined in the notes

 

The First July 2020 Convertible Loan Agreement

 

On July 01, 2020, the Company entered into a loan agreement (the “First July 2020 Loan Agreement”) with an individual (the “First July 2020 Lender”), whereby the First July 2020 Lender issued the Company a promissory note of $68,000 (the “First July 2020 Note”). Pursuant to the First July 2020 Loan Agreement, the First July 2020 Note has interest of ten percent (10%). The First July 2020 Note matures on June 29, 2021.

 

Upon default or 180 days after issuance the First July 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to 61% multiplied by the lowest trade of the common stock during the twenty (15) consecutive trading day period immediately preceding the date of the respective conversion.t

 

During the six months ended June 30, 2021, the First July 2020 Note became convertible. Due to the fact that these convertible notes have an option to convert at a variable amount, they are subject to derivative liability treatment. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The conversion feature has been measured at fair value using a Binomial model at the conversion date and the period end. The conversion feature of First July 2020 Note gave rise to a derivative liability of $112,743. The Company recorded $68,000 as a debt discount and $44,743 was recorded to derivative expense. The debt discount is charged to accretion of debt discount over the remaining term of the convertible note.

 

During the six months ended June 30, 2021 the Company converted $68,000 in principal and $3,400 in interest into 35,469 shares of the Company’s common stock. 

 

The August 2020 Convertible Loan Agreement

 

On August 17, 2020, the Company entered into a loan agreement (the “August 2020 Loan Agreement”) with an individual (the “August 2020 Lender”), whereby the August 2020 Lender issued the Company a promissory note of $68,000 (the “August 2020 Note”). Pursuant to the August 2020 Loan Agreement, the August 2020 Note has interest of twelve percent (12%). The August 2020 Note matures on August 17, 2021.

 

Upon default or 180 days after issuance the August 2020 Convertible Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to 61% multiplied by the lowest trade of the common stock during the twenty (15) consecutive trading day period immediately preceding the date of the respective conversion.

 

The Company recorded a $3,000 debt discount relating to original issue discount associated with this note. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.t

 

During the six months ended June 30, 2021, the August 2020 Note became convertible. Due to the fact that these convertible notes have an option to convert at a variable amount, they are subject to derivative liability treatment. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The conversion feature has been measured at fair value using a Binomial model at the conversion date and the period end. The conversion feature of August 2020 Note gave rise to a derivative liability of $120,759. The Company recorded $65,000 was recorded as a debt discount and $55,759 was recorded to derivative expense. The debt discount is charged to accretion of debt discount over the remaining term of the convertible note.

 

During the six months ended June 30, 2021 the Company converted $68,000 in principal and $3,400 in interest into 29,859 shares of the Company’s common stock.

 

The September 2020 Convertible Loan Agreement

 

On September 23, 2020, the Company entered into a loan agreement (the “September 2020 Loan Agreement”) with an individual (the “September 2020 Lender”), whereby the September 2020 Lender issued the Company a promissory note of $385,000 (the “September 2020 Note”). Pursuant to the September 2020 Loan Agreement, the September 2020 Note has interest of twelve percent (12%). The September 2020 Note matures on September 23, 2021. 

 

Upon default or 180 days after issuance the Second July 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share equal to the closing bid price of the Company’s common stock on the trading day immediately preceding the date of the respective conversion.

 

The Company recorded a $68,255 debt discount relating to original issue discount associated with this note. The Company recorded a $146,393 debt discount relating to 85,555 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. 

 

During the six months ended June 30, 2021 the Company repaid $341,880 in principal and $46,200 in interest.

 

The October 2020 Convertible Loan Agreement

 

On October 2, 2020, the Company entered into a loan agreement (the “October 2020 Loan Agreement”) with an individual (the “October 2020 Lender”), whereby the October 2020 Lender issued the Company a promissory note of $169,400 (the “October 2020 Note”). Pursuant to the October 2020 Loan Agreement, the October 2020 Note has interest of six percent (6%). The October 2020 Note matures on the first (12th) month anniversary of its issuance date.

 

Upon default or 180 days after issuance the October 2020 Note is convertible into shares of the Company’s common stock, par value $0.001 per share (“Conversion Shares”) equal to 75% of average the lowest three trading prices of the Company’s common stock on the fifteen-trading day immediately preceding the date of the respective conversion.

 

The Company recorded a $19,400 debt discount relating to original issue discount associated with this note. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

 

During the six months ended June 30, 2021 the Second July 2020 Note became convertible. Due to the fact that these convertible notes have an option to convert at a variable amount, they are subject to derivative liability treatment. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The conversion feature has been measured at fair value using a Binomial model at the conversion date and the period end. The conversion feature of Second July 2020 Note gave rise to a derivative liability of $74,860. The Company recorded this as a debt discount. The debt discount is charged to accretion of debt discount over the remaining term of the convertible note.

 

During the six months ended June 30, 2021 the Company converted $169,400 in principal and $4,620 in interest into 55,631 shares of the Company’s common stock.

 

The First December 2020 convertible Loan Agreement

 

On December 9, 2020, the Company entered into a loan agreement (the “First December 2020 Loan Agreement”) with an individual (the “First December 2020 Lender”), whereby the First December 2020 Lender issued the Company a promissory note of $600,000 (the “First December 2020 Note”). Pursuant to the First December 2020 Loan Agreement, the First December 2020 Note has interest of twelve percent (12%). As additional consideration for entering in the First December 2020 convertible Loan Agreement, the Company issued 45,000 shares of the Company’s common stock. The First December 2020 Note matures on the first (12th) month anniversary of its issuance date. 

 

Upon default the First December 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to the closing bid price of the Company’s common stock on the trading day immediately preceding the date of the respective conversion.

 

The Company recorded a $110,300 debt discount relating to original issue discount associated with this note. The Company recorded a $113,481 debt discount relating to 45,000 shares issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

 

During the six months ended June 30, 2021 the Company repaid $600,000 in principal and $4,340 in interest.

 

The Second December 2020 Convertible Loan Agreement

 

On December 30, 2020, the Company entered into a loan agreement (the “Second December 2020 Loan Agreement”) with an individual (the “Second December 2020 Lender”), whereby the Second December 2020 Lender issued the Company a promissory note of $169,400 (the “Second December 2020 Note”). Pursuant to the Second December 2020 Loan Agreement, the Second December 2020 Note has interest of six percent (6%). The Second December 2020 Note matures on the first (12th) month anniversary of its issuance date. 

 

Upon default the Second December 2020 Note is convertible into shares of the Company’s common stock, par value $0.001 per share (“Conversion Shares”) equal to 75% of average the lowest three trading prices of the Company’s common stock on the fifteen-trading day immediately preceding the date of the respective conversion.

 

The Company recorded a $18,900 debt discount relating to original issue discount associated with this note. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

 

During the six months ended June 30, 2021 the Second December 2020 Note became convertible. Due to the fact that these convertible notes have an option to convert at a variable amount, they are subject to derivative liability treatment. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The conversion feature has been measured at fair value using a Binomial model at the conversion date and the period end. The conversion feature of Second December 2020 Note gave rise to a derivative liability of $108,880. The Company recorded this as a debt discount. The debt discount is charged to accretion of debt discount over the remaining term of the convertible note.

 

The May 2021 Convertible Note Offering

 

On May 14, 2021, the Company conducted multiple closings of a private placement offering to accredited investors (the “May 2021 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “May 2021 Investors”) for aggregate gross proceeds of $3,690,491. The May 2021 convertible notes are convertible into shares of the Company’s common stock, par value $.001 per share at a conversion price of $5.00 per share. As additional consideration for entering in the May 2021 Convertible Note Offering, the Company issued 1,090,908 warrants of the Company’s common stock. The May 2021 Convertible Note matures on November 14, 2022. 

 

The Company recorded a $1,601,452 debt discount relating to 1,090,908 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of these notes to accretion of debt discount and issuance cost.

 

The Company recorded a $666,669 debt discount relating to an original issue discount and $539,509 of debt issuance costs related to fees paid to vendors relating to the offering. The debt discount and debt issuance costs are being accreted over the life of the note to accretion of debt discount and issuance cost.
v3.21.2
Related Party
 6 Months Ended
Jun. 30, 2021
Related Party Transactions [Abstract]  
Related Party

Note 7 – Related Party

 

Notes payable

 

Notes payable – related party as of June 30, 2021 and December 31, 2020 is as follows:

 

   Outstanding Principal as of          Warrants granted 
   June 30,
2021		   December 31,
2020		   Interest
Rate		   Maturity
Date		  Quantity   Exercise
Price		 
The September 2020 Goldberg Loan Agreement   16,705    16,705          7%  September 2022   
      -
    
      -
 
The September 2020 Rosen Loan Agreement   3,295    3,295    7%  September 2022   
-
    
-
 
    20,000    20,000                   
Less: Debt Discount   (12,110)   (17,068)                  
Less: Debt Issuance Costs   
-
    
-
                   
    7,890    2,932                   
Less: Current Debt   (7,890)   (2,932)                  
   $
-
   $-                   

 

The September 2020 Goldberg Loan Agreement

 

On September 15, 2020, the Company entered into a loan agreement (the “September 2020 Goldberg Loan Agreement”) with Goldberg whereby the Company issued a promissory note of $16,705 (the “September 2020 Goldberg Note”). Pursuant to the September 2020 Goldberg Loan Agreement, the September 2020 Goldberg Note has an interest rate of 7%. The maturity date of the September 2020 Goldberg Note is September 15, 2022 (the “September 2020 Goldberg Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under note are due. The September 2020 Goldberg Loan is secured by the tangible and intangible property of the Company.

 

Since the September 2020 Goldberg Note has a make-whole provision if the shares of the Company’s common stock issued to the lender in accordance with the Lender’s Exchange Agreement (see note 11) have a value equal to or less than $6,463,363 determined by using the lowest VWAP of the last 30 days prior to September 14, 2021. The principal amount of the September 2020 Goldberg Note shall increase by 200% of the difference between the initial consideration and the September 14, 2021 value. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The make-whole feature gave rise to a derivative liability of $2,557,275, of which $2,540,570 was recorded as a loss on extinguishment of debt and $16,705 as a debt discount. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. The derivative liability is marked to market as of June 30, 2021, and the change in derivative liability is recorded on Condensed Consolidated Statements of Comprehensive Loss. See note 8.

 

During the six months ended June 30, 2021 the Company accrued interest of $580.

 

The September 2020 Rosen Loan Agreement

 

On September 15, 2020, the Company entered into a loan agreement (the “September 2020 Rosen Loan Agreement”) with Rosen whereby the Company issued a promissory note of $3,295 (the “September 2020 Rosen Note”). Pursuant to the September 2020 Rosen Loan Agreement, the September 2020 Rosen Note has an interest rate of 7%. The maturity date of the September 2020 Rosen Note is September 15, 2022 (the “September 2020 Rosen Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under the note are due. The September 2020 Rosen Loan is secured by the tangible and intangible property of the Company.

 

Since the September 2020 Rosen Note has a make-whole provision if the shares of the Company’s common stock issued to the lender in accordance with the Lender’s Exchange Agreement (see note 11) have a value equal to or less than $1,274,553 determined by using the lowest VWAP of the last 30 days prior to September 14, 2021. The principal amount of the September 2020 Rosen Note shall increase by 200% of the difference the initial consideration and the September 14, 2021 value. The Company has applied ASC 815, due to the potential for settlement in a variable quantity of shares. The make-whole feature of gave rise to a derivative liability of $504,413, of which $501,118 was recorded as a loss on extinguishment of debt and $3,295 as a debt discount. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost. The derivative liability is marked to market as of June 30, 2021, and the change in derivative liability is recorded on Condensed Consolidated Statements of Comprehensive Loss. See note 8.

 

During the six months ended June 30, 2021 the Company accrued interest of $114.

 

Officer compensation

 

During the six months ended June 30, 2021 the Company paid $72,328 for living expenses for officers of the Company.
v3.21.2
Derivative Liabilities
 6 Months Ended
Jun. 30, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Liabilities

Note 8 – Derivative Liabilities

 

The Company has identified derivative instruments arising from a make-whole feature in the Company’s notes payable at June 30, 2021. For the terms of the make-whole features see the September 2020 Rosen Loan Agreement and the September 2020 Goldberg Loan Agreement in Note 7. The Company has also identified derivative instruments arising from convertible notes that have an option to convert at a variable number of shares in the Company’s convertible notes payable at June 30, 2021. For the terms of the conversion features see Note 7. The Company had no derivative assets measured at fair value on a recurring basis as of June 30, 2021.

 

The Company utilizes a Monte Carlo simulation model for the make whole feature and a binomial option model for convertible notes that have an option to convert at a variable number of shares to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The inputs utilized in the application of the Monte Carlo model included a starting stock price, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, drift, and a risk-free rate. The inputs utilized in the application of the Binomial model included a stock price on valuation date, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, and a risk-free rate. The Company records the change in the fair value of the derivative as other income or expense in the consolidated statements of operations.

 

Risk-free interest rate: The Company uses the risk-free interest rate of a U.S. Treasury Note adjusted to be on a continuous return basis to align with the Monte Carlo simulation model and binomial model.

 

Dividend yield: The Company uses a 0% expected dividend yield as the Company has not paid dividends to date and does not anticipate declaring dividends in the near future.

 

Volatility: The Company calculates the expected volatility based on the company’s historical stock prices with a look back period commensurate with the period to maturity.

 

Expected term: The Company’s remaining term is based on the remaining contractual maturity of the convertible notes.

 

The following are the changes in the derivative liabilities during the three and six months ended June 30, 2021.

 

   Three Months Ended June 30, 2021 
   Level 1   Level 2   Level 3 
Derivative liabilities as April 1, 2021  $
      -
   $
      -
   $344,404 
Addition   
-
    
-
    108,880 
Extinguishment             (82,431)
Changes in fair value   
-
    
-
    65,442 
Derivative liabilities as June 30, 2021  $
-
   $
-
   $436,295 

 

   Six Months Ended June 30, 2021 
   Level 1   Level 2   Level 3 
Derivative liabilities as January 1, 2021  $
      -
   $
      -
   $42,231 
Addition   
-
    
-
    417,241 
Extinguishment             (286,009)
Changes in fair value   
-
    
-
    262,831 
Derivative liabilities as June 30, 2021  $
-
   $
-
   $436,295 
v3.21.2
Stockholders’ Equity
 6 Months Ended
Jun. 30, 2021
Stockholders' Equity Note [Abstract]  
Stockholders’ Equity

Note 9 – Stockholders’ Equity

 

Shares Authorized

 

Prior to July 13, 2020, the Company was authorized to issue up to thirty-five million (35,000,000) shares of capital stock, of which fifteen million (15,000,000) shares are designated as common stock, par value $0.001 per share, and twenty million (20,000,000) are designated as “blank check” preferred stock, par value $0.001 per share. The designations, rights, and preferences of such preferred stock are to be determined by the Company’s board of directors.

 

On July 13, 2020, the Company filed the Second Amended and Restated Articles of Incorporation with the Secretary of State of the State of Nevada, which authorize the issuance of 100,000,000 shares of common stock, and 20,000,000 shares of preferred stock.

 

On August 17, 2020, following board of directors approval, the Company filed a Certificate of Change to its Articles of Incorporation (the “Amendment”), with the Secretary of State of the State of Nevada to effectuate a one-for-twenty (1:3) reverse stock split (the “Reverse Stock Split”) of its common stock, par value $0.001 per share, without any change to its par value. The Amendment became effective on August 17, 2020. No fractional shares were issued in connection with the Reverse Stock Split as all fractional shares were “rounded up” to the next whole share. As a result, all share information in the accompanying condensed consolidated financial statements has been adjusted as if the reverse stock split happened on the earliest date presented.

 

Preferred Stock

 

Series E Convertible Preferred Stock

 

On December 29, 2020 the Company entered into securities purchase agreements with thirty-three accredited investors whereby the Investors have agreed to purchase from the Company an aggregate of 7,778 shares of the Company’s Series E Convertible Preferred Stock, par value $0.001 per share and 2,831,715 warrants to purchase shares of the Company’s common stock, par value $0.001 per share. The Series E Preferred Stock is convertible into a total of 1,887,810 shares of Common Stock. The combined purchase price of one Conversion Share and one and a half warrant was $4.12. The aggregate purchase price for the Series E Preferred Stock and warrants was $7,777,777. The Company has recorded $817,353 to stock issuance costs, which are part of Additional Paid-in Capital.

 

The warrants are exercisable for a term of five-years from the date of issuance, at an exercise price of $4.50 per share. The warrants provide for cashless exercise to the extent that there is no registration statement available for the underlying shares of Common Stock.

 

The placement agent for the transaction and received cash compensation equal to 10% of the aggregate purchase price and warrants to purchase 471,953 shares of the Company’s common stock, at an exercise price of $5.15 per share (the “PA Warrants”). The PA Warrants are exercisable for a term of five-years from the date of issuance.

 

During the six months ended June 30, 2021, the Company received the $40,000 of the subscription receivable for the Series E Convertible Preferred Stock. The Company has recorded $4,225 to stock issuance costs, which are part of Additional Paid-in Capital.

 

During the six months ended June 30, 2021, investors converted 6,730 shares of the Company’s Series E Convertible Preferred Stock into 1,633,439 shares of the Company’s common stock.

 

Common Stock

 

On January 14, 2021, the Company issued 30,000 shares of its restricted common stock to consultants in exchange for services at a fair value of $133,200.

 

On January 20, 2021, the Company issued 40,000 shares of its restricted common stock to consultants in exchange for a year of services at a fair value of $192,000. On May 24, 2021, the Company amended the contract and issued and additional 10,000 shares of its restricted common stock. these shares had a fair value of $34,500. The shares issued to the consultant were recorded as common stock issued for prepaid services and will be expensed over the life of the consulting contract to share based payments. During the six months ended June 30, 2021 the Company recorded $99,908 to stock-based compensation expense related to these shares.

 

On February 1, 2021, the Company issued 50,000 shares of its restricted common stock to consultants in exchange for services at a fair value of $196,000.

 

On February 3, 2021, the Company issued 1,929 shares of its restricted common stock to consultants in exchange for services at a fair value of $8,198.

 

On February 8, 2021, the Company entered into a consulting agreement whereas the Company issued a total of 2,092 shares of common stock in exchange for services at a fair value of $7,502.

 

On February 18, 2021, the Company issued 10,000 shares of its restricted common stock to consultants in exchange for services at a fair value of $48,000.

 

On February 18, 2021, the Company issued 10,417 shares of its restricted common stock to consultants in exchange for services at a fair value of $50,002.

 

On February 26, 2021, the Company issued 291 shares of its restricted common stock to consultants in exchange for services at a fair value of $1,499.

 

On March 17, 2021, the Company issued 9,624 shares of its restricted common stock to consultants in exchange for services at a fair value of $49,371.

 

On March 28, 2021, the Company issued 31,782 shares of its restricted common stock to settle outstanding vendor liabilities of $125,000.

 

On March 31, 2021, the Company issued 13,113 shares of its restricted common stock to settle outstanding vendor liabilities of $43,667. In connection with this transaction the Company also recorded a loss on settlement of vendor liabilities of $12,719.

 

On April 10, 2021, the Company issued 16,275 shares of its restricted common stock to consultants in exchange for services at a fair value of $69,332.

 

On April 21, 2021, the Company entered into a consulting agreement whereas the Company issued a total of 1,048 shares of common stock in exchange for services at a fair value of $3,587.

 

On June 17, 2021, the Company entered into an underwriting agreement with The Benchmark Company LLC, pursuant to which we agreed to sell to the Underwriter in a firm commitment underwritten public offering an aggregate of 750,000 shares of the Company’s common stock, at a public offering price of $3.40 per share. The Company also granted the Underwriter a 30-day option to purchase up to an additional 112,500 shares of Common Stock to cover over-allotments, if any. The Offering closed on June 21, 2021. The net proceeds to the Company from the equity raise was $2,213,500. As part of the underwriting agreement the Company issued 46,667 warrants of the Company’s common stock to Benchmark. The warrants have an exercise price $5.40 and a term of five years.

 

Stock Options

 

The Company applied fair value accounting for all share-based payments awards. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model. 

 

The assumptions used for options granted during the six months ended June 30, 2021, are as follows:

   June 30,
2021		 
Exercise price  $2.55 – 14.10 
Expected dividends  0% 
Expected volatility  223.15 – 242.98% 
Risk free interest rate  0.46 – 0.98% 
Expected life of option  5 - 7 years 

 

The following is a summary of the Company’s stock option activity:

 

   Options   Weighted
Average
Exercise
Price		   Weighted
Average
Remaining
Contractual
Life (in years)		 
Balance – December 31, 2020 – outstanding   541,021    12.75    3.27 
Granted   1,825,500    6.37    6.21 
Exercised   
-
    
-
    
-
 
Forfeited/Cancelled   (3,334)   15.00    
-
 
Balance – June 30, 2021 – outstanding and exercisable   2,363,187    7.82    5.13 

 

Option Outstanding   Option Exercisable 
Exercise price   Number
Outstanding		   Weighted
Average
Remaining
Contractual
Life (in years)		   Weighted
Average
Exercise
Price		   Number
Exercisable		   Weighted
Average
Remaining
Contractual
Life (in years)		 
$7.82    2,363,187    5.13    12.73    537,687    3.82 

 

During the ended December 31, 2018 the Company granted options of 11,667 to consultants that has a fair value of $57,123. As of the date of this filing the company has not issued these options and they are recorded as an accrued liability on the Consolidated Balance Sheet.

 

Stock-based compensation for stock options has been recorded in the consolidated statements of operations and totaled $2,552,855, for the six months ended June 30, 2021.

 

As of June 30, 2021, there was $ 6,122,329 of total unrecognized compensation expense related to unvested employee options granted under the Company’s share-based compensation plans that is expected to be recognized over a weighted average period of approximately 1.23 year.

 

Warrants

 

The Company applied fair value accounting for all share-based payments awards. The fair value of each warrant granted is estimated on the date of grant using the Black-Scholes option-pricing model.

 

The assumptions used for warrants granted during the six months ended June 30, 2020 are as follows:

 

   June 30,
2021		 
Exercise price  $4.50 
Expected dividends   0%
Expected volatility   237.14%
Risk free interest rate   0.82%
Expected life of warrant   5 years 

 

Warrant Activities

 

The following is a summary of the Company’s warrant activity:

 

   Warrant   Weighted
Average
Exercise
Price		 
Balance – December 31, 2020 – outstanding   6,130,948    4.96 
Granted   1,751,892    5.68 
Exercised   (376,214)   4.67 
Forfeited/Cancelled   (10,556)   24.00 
Balance – June 30, 2021 – outstanding   7,496,070    4.88 
Balance – June 30, 2021 – exercisable   7,496,070   $4.88 

 

Warrants Outstanding Warrants Exercisable 
Exercise price   Number
Outstanding		   Weighted
Average
Remaining
Contractual
Life (in years)		   Weighted
Average
Exercise Price		 Number
Exercisable		  Weighted
Average
Exercise
Price		 
$4.88    7,496,070    4.33    4.88   7,496,070   4.33 

 

During the six months ended June 30, 2021, the Company issued 320,693 shares of common stock to a certain warrant holder upon the cashless exercise of a warrant to purchase 376,214 shares of common stock. The Company received $1,272,672 in connection with the exercise of the warrant.

During the six months ended June 30, 2021, a total of 486,516 warrants were issued in connection with the Series E Convertible Preferred Stock raise.

 

During the six months ended June 30, 2021, a total of 1,090,908 warrants were issued with convertible notes (See Note 6 above). The warrants have a grant date fair value of $3,067,617 using a Black-Scholes option-pricing model and the above assumptions.

 

During the six months ended June 30, 2021, some of the Company’s warrants had a reset provision triggered that also resulted in an additional 127,801 warrants to be issued. A deemed dividend of $410,750 was recorded to the Statements of Comprehensive Loss.

 

On June 17, 2021, the Company issued 46,667 warrants in connection with the underwriting agreement.

 

Share-based awards, restricted stock award (“RSAs”)

 

On February 4, 2021 the Board resolved that, the Company shall pay each member of the Board, for each calendar quarter during which such member continues to serve on the Board, compensation as a group amounts to $62,500 per quarter. The shares vest one year after issuance.

 

A summary of the activity related to RSUs for the six months ended June 30, 2021 is presented below:

 

Restricted stock units (RSUs)  Total
shares		   Grant date
fair value		 
RSAs non-vested at January 1, 2021   
-
   $- 
RSAs granted   69,635   $ 3.75 – 4.32 
RSAs vested   
-
   $- 
RSAs forfeited   
-
   $- 
RSAs non-vested June 30, 2021   69,635   $375 – 4.32 

 

Stock-based compensation for RSA’s has been recorded in the consolidated statements of operations and totaled $291,035, for the six months ended June 30, 2021.
v3.21.2
Commitments and Contingencies
 6 Months Ended
Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

Note 10 – Commitments and Contingencies

 

The CARES Act lifts certain deduction limitations originally imposed by the Tax Cuts and Jobs Act of 2017 (“2017 Tax Act”). Corporate taxpayers may carry back net operating losses (NOLs) originating between 2018 and 2020 for up to five years, which was not previously allowed under the 2017 Tax Act. The CARES Act also eliminates the 80% of taxable income limitations by allowing corporate entities to fully utilize NOL carryforwards to offset taxable income in 2018, 2019 or 2020. Taxpayers may generally deduct interest up to the sum of 50% of adjusted taxable income plus business interest income (30% limit under the 2017 Tax Act) for 2019 and 2020. The CARES Act allows taxpayers with alternative minimum tax credits to claim a refund in 2020 for the entire amount of the credits instead of recovering the credits through refunds over a period of years, as originally enacted by the 2017 Tax Act.

 

In addition, the CARES Act raises the corporate charitable deduction limit to 25% of taxable income and makes qualified improvement property generally eligible for 15-year cost-recovery and 100% bonus depreciation. The enactment of the CARES Act did not result in any material adjustments to our income tax provision for the year ended December 31, 2020.

 

On March 26, 2020 and April 30, 2020, the Company received 2 separate loans pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act.

 

When the applications for PPP first opened up, there was limited available funding and much confusion surrounding the application process. The Company initially submitted its application for the May 2020 PPP Loan in early April but received no response in the aftermath of submitting the application. After consulting multiple advisors, the Company made the decision to apply elsewhere, due to the rampant media coverage of institutions running out of funding and the Company’s need for the capital and belief that if 2 separate loans were approved, the remaining application could simply be withdrawn.

 

Therefore, in late April, the company proceeded with applying for the April 2020 PPP Loan. After some conflicting communications regarding acceptance, the Company attempted to contact the lender to clarify but got no response. After continued attempts to follow up with both lenders, the Company received approval for the May 2020 PPP Loan and funding for the April 2020 PPP Loan on the same day, followed the next day by the funding of the May 2020 PPP Loan. The Company immediately separated the funds for the April 2020 PPP Loan into a separate reserved bank account with the intention of returning the funds. However, after several attempts to contact the lender with no response, the Company was faced with difficulty raising funds in the early-Covid economy and made the decision to utilize the funds for operations and pursue an installment repayment plan when they were able to reach the lender. As of the date of this filing, the Company has begun making repayments on the loan, absent a formal installment agreement due to difficulties reaching the lender. The Company intends to complete repayment before the end of 2021.

 

As each company is only permitted one loan under the CARES Act, there is a possibility the loan may be called by the SBA and the Company would have to repay the loan in full at such time.

 

As of June 30, 2021, the May 2020 PPP Loan is no longer outstanding, as during the six months ended June 30, 2021, the Company repaid $136,597 in principal and was forgiven $275,903 of principal and $3,119 of accrued interest. As of June 30, 2021 there was $255,426 in principal outstanding on the April 2020 PPP Loan.

 

Litigation

 

On or about June 25, 2020, Home Revolution, LLC (“Home Revolution”) filed a lawsuit in the United States District Court for the District of New Jersey, Home Revolution, LLC, et al. v. Jerrick Media Holdings, Inc. et al., Case No. 2:20-cv-07775-JMV-MF. The Complaint alleges, among other things, that Creatd, Inc. breached the Membership Interest Purchase Agreement, as modified, and ancillary transaction documents in connection with the acquisition of Seller’s Choice, LLC, from Home Revolution in September 2019. The Complaint additionally alleges violation of the New Jersey Uniform Securities Law, violations of the Exchange Act and Rule 10b-5 thereunder, fraud, equitable accounting, breach of fiduciary duty, conversion and unjust enrichment. After filing the Complaint but prior to our Answer date, Home Revolution moved by order to show cause to have a receiver appointed by the Court to take over Creatd’s operations. 

 

We submitted an opposition, and after oral arguments on August 13, 2020, the Court denied the receiver request in its entirety. We then filed a Motion to Dismiss on August 14, 2020 on a number of grounds, the most significant of which is that this is a simple (alleged) breach of Promissory Note case. Creatd is current on all payments under the Note, and because both parties are New Jersey entities a mere breach of contract and/or collection-based case is not appropriately venued in federal court. Upon receipt of our Motion to Dismiss, Home Revolution submitted an Amended Complaint, presumably in an effort to cure the problems with the Complaint which we identified in the Motion to Dismiss. Home Revolution has subsequently initiated a series of atypical procedures and, as a result, has (without following the Federal Rules of Civil Procedure) moved for both default and to submit yet another newly Amended Complaint (the one precludes the other and vice versa). 

 

After we submitted a motion to clear up the above, the Court reinstated the matter to the docket and permitted Plaintiff to file the Second Amended Complaint (we had no objection). We have filed a motion to dismiss the Second Amended Complaint. That will take some time to be decided. We expect no major event to occur for the next 12 months. Finally, we believe the lawsuit lacks merit and will vigorously challenge the action.

 

Lease Agreements

 

On May 5, 2018, the Company signed a 5-year lease for approximately 2,300 square feet of office space at 2050 Center Avenue Suite 640, Fort Lee, New Jersey 07024. Commencement date of the lease is June 1, 2018. The total amount due under this lease is $411,150.

 

On April 1, 2019, the Company signed a 4-year lease for approximately 796 square feet of office space at 2050 Center Avenue Suite 660, Fort Lee, New Jersey 07024. Commencement date of the lease is April 1, 2019. The total amount due under this lease is $108,229.

 

The components of lease expense were as follows:

 

   Three Months Ended
June 30,
2021		 
Operating lease cost  $20,117 
Short term lease cost   3,714 
Total net lease cost  $23,831 

 

   Six Months Ended
June 30,
2021		 
Operating lease cost  $39,826 
Short term lease cost   7,428 
Total net lease cost  $47,254 

  

Supplemental cash flow and other information related to leases was as follows:

 

   Six Months Ended
June 30,
2021		 
Cash paid for amounts included in the measurement of lease liabilities:     
Operating lease payments   53,977 
Weighted average remaining lease term (in years):   2.0 
Weighted average discount rate:   13%

 

Total future minimum payments required under the lease as of December 31, 2020 are as follows:

 

Twelve Months Ending December 31,    
2021  $55,348 
2022   114,627 
2023   53,094 
Total  $223,069 

 

Rent expense for the six months ended June 30, 2021 and 2020 was $53,869 and $59,168, respectively. 
v3.21.2
Acquisition
 6 Months Ended
Jun. 30, 2021
Asset Acquisition [Abstract]  
Acquisition

Note 11 – Acquisition

 

On June 1, 2021, the Company, entered into a Membership Interest Purchase Agreement (the “MIPA”) with Angela Hein (“Hein”) and Heidi Brown (“Brown”, and together with Hein, the “Sellers”), pursuant to which the Purchaser acquired 490,863 common units (the “Membership Interests”) of Plant Camp LLC, a Delaware limited liability company (“Plant Camp”) from the Sellers, resulting in the Purchaser owning 33% of the issued and outstanding equity of Plant Camp. The Membership Interests were purchased for $175,000.

 

On June 4, 2021, the Company, entered into a MIPA with Sellers, pursuant to which the Purchaser acquired 841,005 common units of Plant Camp from the Sellers, resulting in the Purchaser owning a total of 89% of the issued and outstanding equity of Plant Camp. The additional Membership Interests were purchased for $300,000.

  

The following sets forth the components of the purchase price:

 

Purchase price:    
Cash paid to seller  $300,000 
Fair value of equity investment purchased on June 1, 2021   175,000 
Total purchase price   475,000 
      
Assets acquired:     
Cash   5,232 
Accounts Receivable   7,645 
Inventory   19,970 
Total assets acquired   32,847 
      
Liabilities assumed:     
Accounts payable and accrued expenses   5,309 
Deferred Revenue   671 
Loan Payable   100,000 
Total liabilities assumed   105,980 
      
Net assets acquired   (73,133)
      
Non-controlling interest in consolidated subsidiary   56,865 
      
Excess purchase price  $604,998 

 

The excess purchase price amounts are provisional and may be adjusted during the one-year measurement period as required by U.S. GAAP. The following table provides a summary of the preliminary allocation of the excess purchase price.

 

Goodwill  $2,198 
Trade Names & Trademarks   105,500 
Know-How and Intellectual Property   422,000 
Website   51,300 
Customer Relationships   24,000 
      
Excess purchase price  $604,998 
v3.21.2
Subsequent Events
 6 Months Ended
Jun. 30, 2021
Subsequent Events [Abstract]  
Subsequent Events

Note 12 – Subsequent Events

 

On July 20, 2021, the Company entered into a Stock Purchase Agreement to purchase 44% ownership and 55% of voting power of the issued and outstanding shares of WHE Agency, Inc., (“WHE”). The aggregate closing consideration was $935,000, which consists of a combination of $144,750 in cash and $790,250 in the form of 224,503 shares of the Company’s restricted common stock at a price of $3.52 per share. Based on the purchase price of $935,000 for 44% ownership, the fair value of the non-controlling interest would be approximately $1,190,000.

 

WHE is a talent management and public relations agency dedicated to the representation and management of family- and lifestyle-focused influencers and digital creators. The transaction leverages the existing synergies between Creatd and WHE, specifically enabling WHE to utilize the Vocal platform and technology to further expand its creator network, introduce new verticals, and deepen existing brand ties. At the same time, the addition of WHE enables Creatd to expand its existing agency offerings, specifically within the scope of influencer marketing. With WHE in its portfolio, Creatd has expanded the pool of talent available to partner with its brand clients. Additionally, the transaction created immense opportunity for Creatd in terms of both human capital and market expansion. First, the transaction enables Creatd to enhance its own talent pool; gaining access to WHE’s highly skilled talent managers and brand liaisons fuels new capacity for innovation and growth. Second, WHE’s influencers work with a large set of brand partners, all of whom stand to benefit by working with Creatd Partners on Vocal for Brands marketing campaigns. Integrating WHE and its influencer network into Creatd provides Creatd the benefit of a significantly expanded customer base.

 

The required separate audited financials and pro forma condensed interim statements will be completed and filed as soon as practicable, and in any event not later than October 3, 2021.

 

Subsequent to June 30, 2021, a total of 1,062,574 warrants were exercised, resulting in the cancellation of 1,062,574 warrants, the issuance of 954,568 shares of common stock, and gross proceeds of $4,199,396 to the Company.

 

Subsequent to June 30, 2021, a total of $3,525,000 in principal of convertible notes converted into shares of common stock, resulting in the issuance of 705,000 shares of common stock.

 

Subsequent to June 30, 2021, 438 shares of Series E Preferred Stock converted into common stock, resulting in the issuance of 106,311 shares of common stock.

 

On July 8, 2021, the Company made a deposit of $100,000 towards future ownership in a private company related to the Memorandum of Understanding announced on August 2, 2021, below. At this time, the Company has no voting control nor equity in the private company related to this deposit.

 

On July 28, 2021, the Company entered into a non-binding Memorandum of Understanding to purchase a majority stake in direct-to-consumer company, Wobble Wedge®. Wobble Wedges®, sold through both direct-to-consumer (DTC) and wholesale avenues, are an interlocking modular system of tapered shims that are adaptable to hundreds of uses. Pursuant to the MOU, Creatd intends to acquire a 55% equity stake in Wobble Wedge, in exchange for a combination of cash and stock consideration totaling $500,000. The Company expects to execute definitive agreements in early fourth quarter 2021 and to close shortly thereafter, subject to the completion of due diligence and other closing conditions.

 

On August 2, 2021, the Company entered into a Memorandum of Understanding to acquire a majority equity stake in Dune, Inc., a direct-to-consumer brand focused on promoting wellness through its range of health-oriented beverages. Pursuant to the MOU, Creatd intends to acquire a 50.4% equity stake in Dune in exchange for a combination of cash and stock. The Company expects to execute definitive agreements early in the fourth quarter 2021 and to close shortly thereafter, subject to the completion of due diligence and other closing conditions.
v3.21.2
Accounting Policies, by Policy (Policies)
 6 Months Ended
Jun. 30, 2021
Accounting Policies [Abstract]  
Basis of Presentation

Basis of Presentation

 

The Company’s condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and following the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These interim financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or any other interim period or for any other future year. These unaudited condensed financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2020, included in the Company’s 2020 Annual Report on Form 10-K filed with the SEC. The balance sheet as of December 31, 2020 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements.

 
Use of Estimates and Critical Accounting Estimates and Assumptions

Use of Estimates and Critical Accounting Estimates and Assumptions

 

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

 

These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value.

 

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

 

Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly.

 

Actual results could differ from those estimates.

 
Principles of consolidation

Principles of consolidation

 

The Company consolidates all majority-owned subsidiaries, if any, in which the parent’s power to control exists.

 

As of June 30, 2021, the Company’s consolidated subsidiaries and/or entities are as follows:

 

Name of combined affiliate  State or other
jurisdiction of
incorporation
or organization		  Company
Ownership
Interest		 
Jerrick Ventures LLC  Delaware   100%
Abacus Tech Pty Ltd  Australia   100%
Seller’s Choice, LLC  New Jersey   100%
Recreatd, LLC  Delaware   100%
Give, LLC  Delaware   100%
Creatd Partners LLC  Delaware   100%
Plant Camp LLC  Delaware   89%
Sci-Fi Shop, LLC  Delaware   100%
OG Collection LLC  Delaware   100%
VMENA LLC  Delaware   100%
Vocal For Brands, LLC  Delaware   100%
Vocal Ventures LLC  Delaware   100%
What to Buy, LLC  Delaware   100%

 

All inter-company balances and transactions have been eliminated.

 
Fair Value of Financial Instruments

Fair Value of Financial Instruments

 

The fair value measurement disclosures are grouped into three levels based on valuation factors:

 

  ● Level 1 – quoted prices in active markets for identical investments

 

  ● Level 2 – other significant observable inputs (including quoted prices for similar investments and market corroborated inputs)

 

  ● Level 3 – significant unobservable inputs (including our own assumptions in determining the fair value of investments)

 

The Company’s Level 1 assets/liabilities include cash, accounts receivable, marketable trading securities, accounts payable, prepaid and other current assets, line of credit and due to related parties. Management believes the estimated fair value of these accounts at June 30, 2021 approximate their carrying value as reflected in the balance sheets due to the short-term nature of these instruments or the use of market interest rates for debt instruments.

 

The Company’s Level 2 assets/liabilities include certain of the Company’s notes payable and capital lease obligations. Their carrying value approximates their fair values based upon a comparison of the interest rate and terms of such debt given the level of risk to the rates and terms of similar debt currently available to the Company in the marketplace.

 

The Company’s Level 3 assets/liabilities include goodwill, intangible assets, marketable debt securities, equity investments at cost, and derivative liabilities, when they are recorded at fair value due to an impairment charge. Inputs to determine fair value are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models. Unobservable inputs used in the models are significant to the fair values of the assets and liabilities. 

 

The following table provides a summary of the relevant assets and liabilities that are measured at fair value on recurring basis:

 

Fair Value Measurements as of

June 30, 2021

 

   Total   Quoted
Prices in
Active
Markets for
Identical
Assets or
Liabilities
(Level 1)		   Quoted
Prices for
Similar
Assets or
Liabilities
in Active
Markets
(Level 2)		   Significant
Unobservable
Inputs
(Level 3)		 
Assets:                
Marketable securities - debt securities  $
-
   $
      -
   $
      -
   $
-
 
Total assets  $
-
   $
-
   $
-
   $
-
 
                     
Liabilities:                    
Derivative liabilities  $436,295   $
-
   $
-
   $436,295 
Total Liabilities   436,295   $
-
   $
-
   $436,295 

 

The following table shows the valuation methodology and unobservable inputs for Level 3 assets and liabilities measured at fair value on recurring basis as of June 30, 2021:

 

   Fair Value   Valuation Methodology    Unobservable Inputs  
Marketable securities - debt securities  $
-
   Discounted cash flow analysis    Expected cash flows from the investment  
                
Derivative liabilities  $436,295   Monte Carlo simulations and Binomial model   

Risk free rate

 

Expected volatility; Drift rate

  

 

The following table provides a summary of the relevant assets that are measured at fair value on non-recurring basis:

 

Fair Value Measurements as of

June 30, 2021

 

   Total   Quoted
Prices in
Active
Markets for
Identical
Assets or
Liabilities
(Level 1)		   Quoted
Prices for
Similar
Assets or
Liabilities
in Active Markets
(Level 2)		   Significant
Unobservable
Inputs
(Level 3)		 
Assets:                
Equity investments, at cost  $367,096   $
      -
   $
      -
   $367,096 
Total assets  $367,096   $
-
   $
-
   $367,096 

 

The following table shows the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on non-recurring basis as of June 30, 2021:

 

   Fair Value   Valuation Methodology    Unobservable Inputs  
Equity investments, at cost  $367,096   Qualitative assessment per ASC 321-10-35    Qualitative factors  

 

The Company valued the initial value of debt securities, which are investments in convertible notes receivable, by assessing the separate values of the debt and equity components for similar instruments convertible into private company equity (Level 3). The investment was initially measured at cost, which was determined to approximate fair value due to the lack of marketability of the conversion shares underlying these convertible instruments and the expected recoverability of the note principal. The key assumption affecting the level 3 fair values would be collectability of the notes. The Company monitors for impairment indicators at each balance sheet date.

 
Cash Equivalents

Cash Equivalents

 

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

 

At times, cash balances may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurable limits. The Company has never experienced any losses related to these balances. As of June 30, 2021, and December 31, 2020, cash amounts in excess of $250,000 were not fully insured. The uninsured cash balance as of June 30, 2021 was approximately $1.9 million. The Company does not believe it is exposed to significant credit risk on cash and cash equivalents.

 
Long-lived Assets Including Goodwill and Other Acquired Intangibles Assets

Long-lived Assets Including Goodwill and Other Acquired Intangibles Assets

 

We evaluate the recoverability of property and equipment and acquired finite-lived intangible assets for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. The evaluation is performed at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability of these assets is measured by a comparison of the carrying amounts to the future undiscounted cash flows the assets are expected to generate from the use and eventual disposition. If such review indicates that the carrying amount of property and equipment and intangible assets is not recoverable, the carrying amount of such assets is reduced to fair value. We have not recorded any impairment charges for these type of assets during the six months ended June 30, 2021.

 

Acquired finite-lived intangible assets are amortized on a straight-line basis over the estimated useful lives of the assets. We routinely review the remaining estimated useful lives of property and equipment and finite-lived intangible assets. If we change the estimated useful life assumption for any asset, the remaining unamortized balance is amortized or depreciated over the revised estimated useful life.

 

During the year ended December 31, 2020 the Company completed its annual impairment test of goodwill. The Company performed the qualitative assessment as permitted by ASC 350-20 and determined that the fair value of the reporting unit was more likely than not equal or greater than the carrying value, including Goodwill. Based on completion of this annual impairment test, no impairment was indicated.

 
Investments

Investments

 

Marketable securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and are reported at fair value, with unrealized gains and losses recognized in earnings. Debt securities not classified as held-to-maturity or as trading are classified as available-for-sale, and are carried at fair market value, with the unrealized gains and losses, net of tax, included in the determination of comprehensive income and reported in stockholders’ equity.

 

The Company accounts for its investments in available-for-sale debt securities, in accordance with sub-topic 320-10 of the FASB ASC (“Sub-Topic 320-10”). Accrued interest on these securities is included in fair value and amortized cost.

 

Pursuant to Paragraph 320-10-35, investments in debt securities that are classified as available for sale shall be measured subsequently at fair value in the statement of financial position. Unrealized holding gains and losses for available-for-sale securities (including those classified as current assets) shall be excluded from earnings and reported in other comprehensive income until realized.

 

The Company follows FASB ASC 320-10-35 to assess whether an investment in debt securities is impaired in each reporting period. An investment in debt securities is impaired if the fair value of the investment is less than its amortized cost. If the Company intends to sell the debt security (that is, it has decided to sell the security), an other-than-temporary impairment shall be considered to have occurred. If the Company more likely than not will be required to sell the security before recovery of its amortized cost basis or it otherwise does not expect to recover the entire amortized cost basis of the security, an other-than-temporary impairment shall be considered to have occurred. The Company considers the expected cash flows from the investment based on reasonable and supportable forecasts as well as several other factors to estimate whether a credit loss exists. If the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, the other-than-temporary impairment shall be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date.

 

The following table sets forth a summary of the changes in marketable securities - available-for-sale debt securities that are measured at fair value on a recurring basis:

 

   For the
three and
six months ended
June 30,
2021		 
   Total 
Beginning of period  $62,733 
Purchase of marketable securities   - 
Interest due at maturity   - 
Other than temporary impairment   (62,733)
Conversion of marketable securities   - 
June 30, 2021  $- 

 

We invest in debt securities. Our investments in debt securities are subject to interest rate risk. To minimize the exposure due to an adverse shift in interest rates, we invest in securities with maturities of two years or less and maintain a weighted average maturity of one year or less. As of June 30, 2021, all of our investments had maturities between one and three years. The marketable debt security investments are evaluated for impairment if events or circumstances arise that indicate that the carrying amount of such assets may not be recoverable. During the three and six months ended June 30, 2021 the Company recognized a $62,733 impairment of the debt security.

 

The following table sets forth a summary of the changes in equity investments, at cost that are measured at fair value on a non-recurring basis: 

 

   For the
three months ended
June 30,
2021		   For the
six months ended
June 30,
2021		 
   Total   Total 
Beginning of period  $317,096   $217,096 
Purchase of equity investments   50,000    150,000 
June 30, 2021  $367,096   $367,096 

 

The Company has elected to measure its equity securities without a readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. An election to measure an equity security in accordance with this paragraph shall be made for each investment separately.

 

The Company performed a qualitative assessment considering impairment indicators to evaluate whether these investments were impaired. Impairment indicators that the Company considered included the following: a) a significant deterioration in the earnings performance, credit rating, asset quality or business prospects of the investee; b) a significant adverse change in the regulatory, economic or technology environment of the investee; c) a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates; d) a bona fide offer to purchase or an offer by the investee to sell the investment; e) factors that raise significant concerns about the investee’s ability to continue as a going concern.

 
Commitments and Contingencies

Commitments and Contingencies

 

The Company follows subtopic 450-20 of the FASB ASC to report accounting for contingencies. Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

 

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

 

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

 
Foreign Currency

Foreign Currency

 

Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at our Consolidated Balance Sheet dates. Results of operations and cash flows are translated using the average exchange rates throughout the periods. The effect of exchange rate fluctuations on the translation of assets and liabilities is included as a component of stockholders’ equity in accumulated other comprehensive income. Gains and losses from foreign currency transactions, which are included in operating expenses, have not been significant in any period presented.

 
Derivative Liability

Derivative Liability

 

The Company evaluates its debt and equity issuances to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 815-10-05-4 and Section 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation and then the related fair value is reclassified to equity.

 

In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. 

 

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date.

 

The Company adopted Section 815-40-15 of the FASB Accounting Standards Codification (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The Company changed its method of accounting for the debt and warrants through the early adoption of ASU 2017-11 during the three months ended December 31, 2017, on a retrospective basis.

 

The Company utilizes a Monte Carlo simulation model for the make whole feature and a binomial option model for convertible notes that have an option to convert at a variable number of shares to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The inputs utilized in the application of the Monte Carlo model included a starting stock price, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, drift, and a risk-free rate. The inputs utilized in the application of the Binomial model included a stock price on valuation date, an expected term of each debenture remaining from the valuation date to maturity, an estimated volatility, and a risk-free rate. The Company records the change in the fair value of the derivative as other income or expense in the consolidated statements of operations.

 
Revenue Recognition

Revenue Recognition

 

Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

 

We determine revenue recognition through the following steps:

 

  ● identification of the contract, or contracts, with a customer;

 

  ● identification of the performance obligations in the contract;

 

  ● determination of the transaction price. The transaction price for any given subscriber could decrease based on any payments made to that subscriber. A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mile basis) and cash prizes offered to Challenge winners;

 

  ● allocation of the transaction price to the performance obligations in the contract; and

 

  ● recognition of revenue when, or as, we satisfy a performance obligation.

 

Revenue disaggregated by revenue source for the three and six months ended June 30, 2021 and 2020 consists of the following:

 

   Three Months Ended   Six Months Ended 
   June 30,   June 30, 
   2021   2020   2021   2020 
Agency (Managed Services + Branded Content)  $488,836   $258,834   $917,136   $507,085 
Platform (Creator Subscriptions)   451,965    54,972    758,867    90,934 
Ecommerce   5,526    
-
    5,526    
-
 
Affiliate Sales   7,798    8,195    15,806    16,344 
Other Revenue   16,732    539    17,435    1,319 
   $970,857   $322,540   $1,714,770   $615,682 

 

Timing of revenue recognition for the three and six months ended June 30, 2021 and 2020 consists of the following:

 

   Three Months Ended   Six Months Ended 
   June 30,   June 30, 
   2021   2020   2021   2020 
Products and services transferred over time  $940,801   $313,806   $1,676,003   $598,019 
Products transferred at a point in time   30,056    8,734    38,767    17,663 
   $970,857   $322,540   $1,714,770   $615,682 

  

Agency Revenue

 

Managed Services

The Company provides Studio/Agency Service offerings to business-to-business (B2B) and business-to-consumer (B2C) product and service brands which encompasses a full range of digital marketing and e-commerce solutions. The Company’s services include the setup and ongoing management of clients’ websites, Amazon and Shopify storefronts and listings, social media pages, search engine marketing, and other various tools and sales channels utilized by e-commerce sellers for sales and growth optimization. Contracts are broken into three categories: Partners, Monthly Services, and Projects. Contract amounts for Partner and Monthly Services clients range from approximately $500-$7,500 per month while Project amounts vary depending on the scope of work. Partner and Monthly clients are billed monthly for the work completed within that month. Partner Clients may or may not have an additional billing component referred to as Sales Performance Fee, which is a fee based upon a previously agreed upon percentage point of the client’s total sales for the month. Some Partners may also have projects within their contracts that get billed and recognized as agreed upon project milestones are achieved. Revenue is recognized over time as service obligations and milestones in the contract are met.

Branded Content

 

Branded content represents the revenue recognized from the Company’s obligation to create and publish branded articles for clients on the Vocal platform and promote said stories, tracking engagement for the client. The performance obligation is satisfied when the Company successfully publishes the articles on its platform and meets any required promotional milestones as per the contract. The revenue is recognized over time as the services are performed and any required milestones are met.

 

Below are the significant components of a typical agreement pertaining to branded content revenue:

 

  ● The Company collects fixed fees ranging from $10,000 to $110,000.
     
  ● The articles are created and published within three months of the signed agreement, or as previously negotiated with the client.
     
  ● The articles are promoted per the contract and engagement reports are provided to the client.
     
  ● Most billing for contracts occurs 50% at signing and 50% upon completion of the services, with net payment terms varying per client.
     
  ● Most contracts include provisions for clients to acquire content rights at the end of the campaign for a flat fee. 

 

Platform Revenue

 

Creator Subscriptions

 

Vocal+ is a premium subscription offering for Vocal creators. In addition to joining for free, Vocal creators now have the option to sign up for a Vocal+ membership for either $9.99 monthly or $99 annually, though these amounts are occasionally subject to promotional discounts. Vocal+ subscribers receive access to value-added features such as increased rate of cost per mille (thousand) (“CPM”) monetization, a decreased minimum withdrawal threshold, a discount on platform processing fees, member badges for their profiles, access to exclusive Vocal+ Challenges, and early access to new Vocal features. Subscription revenues stem from both monthly and annual subscriptions, the latter of which is amortized over a twelve-month period. Any customer payments received are recognized over the subscription period, with any payments received in advance being deferred until they are earned.

 

The transaction price for any given subscriber could decrease based on any payments made to that subscriber. A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mille basis) and cash prizes offered to Challenge winners. Estimates are utilized for payments made for earnings through reads, by establishing the lifetime a subscriber has had a Vocal account, determining the percentage of that lifetime that the subscriber has been a paying customer, and applying that percentage to payments for earnings through reads in the relevant reporting period.

 

Affiliate Sales Revenue

 

Affiliate sales represents the commission the Company receives when a purchase is made through affiliate links placed within content hosted on the Vocal platform. Affiliate revenue is earned on a “click through” basis, upon referring visitors, via said links, to an affiliate’s site and having them complete a specific outcome, most commonly a product purchase. The Company uses multiple affiliate platforms, such as Skimlinks, Amazon, and Tune, to form and maintain thousands of vendor relationships. Each vendor establishes their own commission percentage, which typically range from 2-20%. The revenue is recognized upon receipt as reliable estimates could not be made.

 
E-Commerce Revenue

E-Commerce Revenue

 

The Company generates revenue through the sale of consumer products through its e-commerce distribution channels. The Company satisfies its performance obligation upon receipt of product by its customers.
Deferred Revenue

Deferred Revenue

 

Deferred revenue consists of billings and payments from clients in advance of revenue recognition. As of June 30, 2021, and December 31, 2020, the Company had deferred revenue of $208,517 and $88,637, respectively.

 
Accounts Receivable and Allowances

Accounts Receivable and Allowances

 

Accounts receivable are recorded and carried when the Company has performed the work in accordance with managed services, project, partner, consulting and branded content agreements. For example, we bill a managed service client monthly when we have updated their Amazon store, modified SEO or completed the other services listed in the agreement. For projects and branded content, we will bill the client and record the receivable once milestones are reached that are set in the agreement. We make estimates for the allowance for doubtful accounts and allowance for unbilled receivables based upon our assessment of various factors, including historical experience, the age of the accounts receivable balances, credit quality of our customers, current economic conditions, and other factors that may affect our ability to collect from customers. During the six months ended June 30, 2021, the Company recorded $0 as a bad debt expense. As of June 30, 2021, and December 31, 2020, the Company has an allowance for doubtful accounts of $76,340 and $80,509, respectively.

 
Stock-Based Compensation

Stock-Based Compensation

 

The Company recognizes compensation expense for all equity–based payments granted in accordance with Accounting Standards Codification (“ASC”) 718 “Compensation – Stock Compensation”. Under fair value recognition provisions, the Company recognizes equity–based compensation net of an estimated forfeiture rate and recognizes compensation cost only for those shares expected to vest over the requisite service period of the award.

 

Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods.

 

The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the value of the underlying share, the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is benchmarked against similar companies in a similar industry over the expected option life and other appropriate factors. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on its Common stock and does not intend to pay dividends on its Common stock in the foreseeable future. The expected forfeiture rate is estimated based on management’s best estimate. 

 

Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, our equity–based compensation could be materially different in the future. The Company issues awards of equity instruments, such as stock options and restricted stock units, to employees and certain non-employee directors. Compensation expense related to these awards is based on the fair value of the underlying stock on the award date and is amortized over the service period, defined as the vesting period, using the cliff straight-line method. The vesting period is generally one to three years. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant is used for restricted stock units. Compensation expense is reduced for actual forfeitures as they occur.

 
Loss Per Share

Loss Per Share

 

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case for the three and six months ended June 30, 2021 and 2020 presented in these condensed consolidated financial statements, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

 

The Company had the following common stock equivalents at June 30, 2021 and 2020:

 

   June 30, 
   2021   2020 
Options   2,363,187    452,523 
Warrants   7,496,070    936,240 
Convertible notes - related party   
-
    5,574 
Convertible notes   1,008,798    1,562,138 
Totals   10,868,055    2,956,475 

 
Reclassifications

Reclassifications

 

Certain prior year amounts in the consolidated financial statements and the notes thereto have been reclassified where necessary to conform to the current year's presentation. These reclassifications did not affect the prior period's total assets, total liabilities, stockholders’ deficit, net loss or net cash used in operating activities.

 
Recently Adopted Accounting Guidance

Recently Adopted Accounting Guidance

 

In December 2019, the FASB issued authoritative guidance intended to simplify the accounting for income taxes (ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”). This guidance eliminates certain exceptions to the general approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes. This guidance is effective for annual periods after December 15, 2020, including interim periods within those annual periods. The updated guidance, which became effective for fiscal years beginning after December 15, 2020, did not have a material impact on the Company’s condensed consolidated financial statements.

 
Recent Accounting Guidance Not Yet Adopted

Recent Accounting Guidance Not Yet Adopted

 

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments (“ASU-2016-13”). ASU 2016-13 affects loans, debt securities, trade receivables, and any other financial assets that have the contractual right to receive cash. The ASU requires an entity to recognize expected credit losses rather than incurred losses for financial assets. ASU 2016-13 is effective for the fiscal year beginning after December 15, 2022, including interim periods within that fiscal year. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

 

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU amends the guidance on convertible instruments and the derivatives scope exception for contracts in an entity’s own equity, and also improves and amends the related EPS guidance for both Subtopics. The ASU will be effective for annual reporting periods after December 15, 2021, and interim periods within those annual periods and early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

 

In May 2021, the FASB issued authoritative guidance intended to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. (ASU 2021-04), “Derivatives and Hedging Contracts in Entity’s Own Equity (Topic 815). This guidance amendments provide measurement, recognition, and disclosure guidance for an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. This guidance is effective for annual periods after December 15, 2021, including interim periods within those annual periods. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

 

Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying condensed consolidated financial statements.
v3.21.2
Significant Accounting Policies and Practices (Tables)
 6 Months Ended
Jun. 30, 2021
Accounting Policies [Abstract]  
Schedule of consolidated subsidiaries and/or entities
Name of combined affiliate  State or other
jurisdiction of
incorporation
or organization		  Company
Ownership
Interest		 
Jerrick Ventures LLC  Delaware   100%
Abacus Tech Pty Ltd  Australia   100%
Seller’s Choice, LLC  New Jersey   100%
Recreatd, LLC  Delaware   100%
Give, LLC  Delaware   100%
Creatd Partners LLC  Delaware   100%
Plant Camp LLC  Delaware   89%
Sci-Fi Shop, LLC  Delaware   100%
OG Collection LLC  Delaware   100%
VMENA LLC  Delaware   100%
Vocal For Brands, LLC  Delaware   100%
Vocal Ventures LLC  Delaware   100%
What to Buy, LLC  Delaware   100%

 
Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis
   Total   Quoted
Prices in
Active
Markets for
Identical
Assets or
Liabilities
(Level 1)		   Quoted
Prices for
Similar
Assets or
Liabilities
in Active
Markets
(Level 2)		   Significant
Unobservable
Inputs
(Level 3)		 
Assets:                
Marketable securities - debt securities  $
-
   $
      -
   $
      -
   $
-
 
Total assets  $
-
   $
-
   $
-
   $
-
 
                     
Liabilities:                    
Derivative liabilities  $436,295   $
-
   $
-
   $436,295 
Total Liabilities   436,295   $
-
   $
-
   $436,295 

 

   Total   Quoted
Prices in
Active
Markets for
Identical
Assets or
Liabilities
(Level 1)		   Quoted
Prices for
Similar
Assets or
Liabilities
in Active Markets
(Level 2)		   Significant
Unobservable
Inputs
(Level 3)		 
Assets:                
Equity investments, at cost  $367,096   $
      -
   $
      -
   $367,096 
Total assets  $367,096   $
-
   $
-
   $367,096 

 
Schedule of fair value measurement inputs and valuation techniques
   Fair Value   Valuation Methodology    Unobservable Inputs  
Marketable securities - debt securities  $
-
   Discounted cash flow analysis    Expected cash flows from the investment  
                
Derivative liabilities  $436,295   Monte Carlo simulations and Binomial model   

Risk free rate

 

Expected volatility; Drift rate

  

 

   Fair Value   Valuation Methodology    Unobservable Inputs  
Equity investments, at cost  $367,096   Qualitative assessment per ASC 321-10-35    Qualitative factors  

 
Schedule of changes in marketable securities
   For the
three and
six months ended
June 30,
2021		 
   Total 
Beginning of period  $62,733 
Purchase of marketable securities   - 
Interest due at maturity   - 
Other than temporary impairment   (62,733)
Conversion of marketable securities   - 
June 30, 2021  $- 

 

   For the
three months ended
June 30,
2021		   For the
six months ended
June 30,
2021		 
   Total   Total 
Beginning of period  $317,096   $217,096 
Purchase of equity investments   50,000    150,000 
June 30, 2021  $367,096   $367,096 

 
Schedule of revenue disaggregated by revenue
   Three Months Ended   Six Months Ended 
   June 30,   June 30, 
   2021   2020   2021   2020 
Agency (Managed Services + Branded Content)  $488,836   $258,834   $917,136   $507,085 
Platform (Creator Subscriptions)   451,965    54,972    758,867    90,934 
Ecommerce   5,526    
-
    5,526    
-
 
Affiliate Sales   7,798    8,195    15,806    16,344 
Other Revenue   16,732    539    17,435    1,319 
   $970,857   $322,540   $1,714,770   $615,682 

 
Schedule of revenue recognition
   Three Months Ended   Six Months Ended 
   June 30,   June 30, 
   2021   2020   2021   2020 
Products and services transferred over time  $940,801   $313,806   $1,676,003   $598,019 
Products transferred at a point in time   30,056    8,734    38,767    17,663 
   $970,857   $322,540   $1,714,770   $615,682 

  
Schedule of common stock equivalents
   June 30, 
   2021   2020 
Options   2,363,187    452,523 
Warrants   7,496,070    936,240 
Convertible notes - related party   
-
    5,574 
Convertible notes   1,008,798    1,562,138 
Totals   10,868,055    2,956,475 

 
v3.21.2
Notes Payable (Tables)
 6 Months Ended
Jun. 30, 2021
Debt Disclosure [Abstract]  
Schedule of notes payable
   Outstanding Principal as of         
   June 30,
2021		   December 31,
2020		   Interest
Rate		   Maturity
Date		 
Seller’s Choice Note  $660,000   $660,000    30%  September 2020 
The May 2020 PPP Loan Agreement   252,432    412,500    1%  April 2022 
The April 2020 PPP Loan Agreement   
-
    282,432    1%  May 2022 
The October 2020 Loan Agreement   56,796    55,928    14%  July 21 
The November 2020 Loan Agreement   
-
    23,716    14%  May 2021 
The February 2021 Loan Agreement   85,372    
-
    14%  July 21 
The April 2021 Loan Agreement   41,585    
-
    10%  October 22 
    1,096,185    1,434,576          
Less: Debt Discount   (7,549)   
-
               
Less: Debt Issuance Costs   
-
    
-
          
    1,088,636    1,434,576          
Less: Current Debt   (1,054,600)   (1,221,539)         
Total Long-Term Debt  $34,036   $213,037          

 
v3.21.2
Convertible Note Payable (Tables)
 6 Months Ended
Jun. 30, 2021
Convertible Note Payable [Abstract]  
Schedule of convertible notes payable
   Outstanding Principal as of               Warrants granted 
  

June 30,

2021

  

December 31,

2020

  

Interest

Rate

  

Conversion

Price

   

Maturity

Date

 

Quantity

  

Exercise

Price

 
The September 2020 convertible Loan Agreement  $
-
   $341,880    12%   
      -
 (*)   September-21   85,555          5 
The First December 2020 convertible Loan Agreement   
-
    600,000    12%   
-
 (*)   December-21   
-
    
-
 
The October 2020 convertible Loan Agreement   
-
    169,400    6%   
-
 (*)   October-21   
-
    
-
 
The Second December 2020 convertible Loan Agreement   169,400    169,400    6%   
-
 (*)   December-21   
-
    
-
 
The May 2021 Loan   4,666,669    
-
    
-
%   5.00 (*)   November-22   1,090,908    4.50-  
    4,836,069    1,280,680                         
Less: Debt Discount   (2,174,294)   (309,637)                        
Less: Debt Issuance Costs   (495,327)   (73,527)                        
    2,166,448    897,516                         
Less: Current Debt   (67,048)   (897,516)                        
Total Long-Term Debt  $2,099,400   $
-
                         
v3.21.2
Related Party (Tables)
 6 Months Ended
Jun. 30, 2021
Related Party Transactions [Abstract]  
Schedule of convertible notes payable - related party
   Outstanding Principal as of          Warrants granted 
   June 30,
2021		   December 31,
2020		   Interest
Rate		   Maturity
Date		  Quantity   Exercise
Price		 
The September 2020 Goldberg Loan Agreement   16,705    16,705          7%  September 2022   
      -
    
      -
 
The September 2020 Rosen Loan Agreement   3,295    3,295    7%  September 2022   
-
    
-
 
    20,000    20,000                   
Less: Debt Discount   (12,110)   (17,068)                  
Less: Debt Issuance Costs   
-
    
-
                   
    7,890    2,932                   
Less: Current Debt   (7,890)   (2,932)                  
   $
-
   $-                   

 
v3.21.2
Derivative Liabilities (Tables)
 6 Months Ended
Jun. 30, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of changes in the derivative liabilities
   Three Months Ended June 30, 2021 
   Level 1   Level 2   Level 3 
Derivative liabilities as April 1, 2021  $
      -
   $
      -
   $344,404 
Addition   
-
    
-
    108,880 
Extinguishment             (82,431)
Changes in fair value   
-
    
-
    65,442 
Derivative liabilities as June 30, 2021  $
-
   $
-
   $436,295 

 

   Six Months Ended June 30, 2021 
   Level 1   Level 2   Level 3 
Derivative liabilities as January 1, 2021  $
      -
   $
      -
   $42,231 
Addition   
-
    
-
    417,241 
Extinguishment             (286,009)
Changes in fair value   
-
    
-
    262,831 
Derivative liabilities as June 30, 2021  $
-
   $
-
   $436,295 
v3.21.2
Stockholders’ Equity (Tables)
 6 Months Ended
Jun. 30, 2021
Stockholders’ Equity (Tables) [Line Items]  
Schedule of warrant activity
   Options   Weighted
Average
Exercise
Price		   Weighted
Average
Remaining
Contractual
Life (in years)		 
Balance – December 31, 2020 – outstanding   541,021    12.75    3.27 
Granted   1,825,500    6.37    6.21 
Exercised   
-
    
-
    
-
 
Forfeited/Cancelled   (3,334)   15.00    
-
 
Balance – June 30, 2021 – outstanding and exercisable   2,363,187    7.82    5.13 

 
Schedule of outstanding and exercisable
Option Outstanding   Option Exercisable 
Exercise price   Number
Outstanding		   Weighted
Average
Remaining
Contractual
Life (in years)		   Weighted
Average
Exercise
Price		   Number
Exercisable		   Weighted
Average
Remaining
Contractual
Life (in years)		 
$7.82    2,363,187    5.13    12.73    537,687    3.82 

 
Schedule of outstanding and exercisable
Warrants Outstanding Warrants Exercisable 
Exercise price   Number
Outstanding		   Weighted
Average
Remaining
Contractual
Life (in years)		   Weighted
Average
Exercise Price		 Number
Exercisable		  Weighted
Average
Exercise
Price		 
$4.88    7,496,070    4.33    4.88   7,496,070   4.33 

 
Schedule of activity related to RSUs
Restricted stock units (RSUs)  Total
shares		   Grant date
fair value		 
RSAs non-vested at January 1, 2021   
-
   $- 
RSAs granted   69,635   $ 3.75 – 4.32 
RSAs vested   
-
   $- 
RSAs forfeited   
-
   $- 
RSAs non-vested June 30, 2021   69,635   $375 – 4.32 

 
Options [Member]  
Stockholders’ Equity (Tables) [Line Items]  
Schedule of assumptions warrant granted
   June 30,
2021		 
Exercise price  $2.55 – 14.10 
Expected dividends  0% 
Expected volatility  223.15 – 242.98% 
Risk free interest rate  0.46 – 0.98% 
Expected life of option  5 - 7 years 

 
Warrant [Member]  
Stockholders’ Equity (Tables) [Line Items]  
Schedule of assumptions warrant granted
   June 30,
2021		 
Exercise price  $4.50 
Expected dividends   0%
Expected volatility   237.14%
Risk free interest rate   0.82%
Expected life of warrant   5 years 

 
Schedule of warrant activity
   Warrant   Weighted
Average
Exercise
Price		 
Balance – December 31, 2020 – outstanding   6,130,948    4.96 
Granted   1,751,892    5.68 
Exercised   (376,214)   4.67 
Forfeited/Cancelled   (10,556)   24.00 
Balance – June 30, 2021 – outstanding   7,496,070    4.88 
Balance – June 30, 2021 – exercisable   7,496,070   $4.88 

 
v3.21.2
Commitments and Contingencies (Tables)
 6 Months Ended
Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]  
Schedule of components of lease expense
   Three Months Ended
June 30,
2021		 
Operating lease cost  $20,117 
Short term lease cost   3,714 
Total net lease cost  $23,831 

 

   Six Months Ended
June 30,
2021		 
Operating lease cost  $39,826 
Short term lease cost   7,428 
Total net lease cost  $47,254 

  
Schedule supplemental cash flow and other information related to leases
   Six Months Ended
June 30,
2021		 
Cash paid for amounts included in the measurement of lease liabilities:     
Operating lease payments   53,977 
Weighted average remaining lease term (in years):   2.0 
Weighted average discount rate:   13%

 
Schedule of future minimum payments required under the lease
Twelve Months Ending December 31,    
2021  $55,348 
2022   114,627 
2023   53,094 
Total  $223,069 

 
v3.21.2
Acquisition (Tables)
 6 Months Ended
Jun. 30, 2021
Asset Acquisition [Abstract]  
Schedule of components of the purchase price
Purchase price:    
Cash paid to seller  $300,000 
Fair value of equity investment purchased on June 1, 2021   175,000 
Total purchase price   475,000 
      
Assets acquired:     
Cash   5,232 
Accounts Receivable   7,645 
Inventory   19,970 
Total assets acquired   32,847 
      
Liabilities assumed:     
Accounts payable and accrued expenses   5,309 
Deferred Revenue   671 
Loan Payable   100,000 
Total liabilities assumed   105,980 
      
Net assets acquired   (73,133)
      
Non-controlling interest in consolidated subsidiary   56,865 
      
Excess purchase price  $604,998 

 

Goodwill  $2,198 
Trade Names & Trademarks   105,500 
Know-How and Intellectual Property   422,000 
Website   51,300 
Customer Relationships   24,000 
      
Excess purchase price  $604,998 
v3.21.2
Organization and Operations (Details) - shares
Feb. 05, 2016
Jun. 04, 2021
Sep. 11, 2019
Series of Individually Immaterial Business Acquisitions [Member]      
Organization and Operations (Details) [Line Items]      
Acquired percentage   89.00% 100.00%
Kent Campbell [Member]      
Organization and Operations (Details) [Line Items]      
Cancelled of common stock 39,091    
Great Plains Holdings Inc [Member]      
Organization and Operations (Details) [Line Items]      
Issuance of common shares for cash 475,000    
Series A Convertible Preferred Stock [Member]      
Organization and Operations (Details) [Line Items]      
Issuance of common shares for cash 33,415    
Series B Convertible Preferred Stock [Member]      
Organization and Operations (Details) [Line Items]      
Issuance of common shares for cash 8,064    
v3.21.2
Significant Accounting Policies and Practices (Details) - USD ($)
 3 Months Ended 6 Months Ended 12 Months Ended
Jun. 30, 2021
Jun. 30, 2021
Dec. 31, 2020
Significant Accounting Policies and Practices (Details) [Line Items]      
Cash excess amounts   $ 250,000  
Uninsured cash balance $ 1,900,000 $ 1,900,000  
Description of investments   Our investments in debt securities are subject to interest rate risk. To minimize the exposure due to an adverse shift in interest rates, we invest in securities with maturities of two years or less and maintain a weighted average maturity of one year or less.  
Debt security 62,733 $ 62,733  
Billing description   A subscriber may be eligible for payment through one or more of the monetization features offered to Vocal creators, including earnings through reads (on a cost per mile basis) and cash prizes offered to Challenge winners;  
Deferred revenue $ 208,517 $ 208,517 $ 88,637
Bad debt expense   0  
Allowance for doubtful accounts   76,340 $ 80,509
Minimum [Member]      
Significant Accounting Policies and Practices (Details) [Line Items]      
Contract amounts for partner and monthly services clients   500  
Fixed fees   $ 10,000  
Affiliate sales percentage   2.00%  
Maximum [Member]      
Significant Accounting Policies and Practices (Details) [Line Items]      
Contract amounts for partner and monthly services clients   $ 7,500  
Fixed fees   $ 110,000  
Affiliate sales percentage   20.00%  
Subscription Arrangement [Member]      
Significant Accounting Policies and Practices (Details) [Line Items]      
Payment related percentage, description   Vocal+ is a premium subscription offering for Vocal creators. In addition to joining for free, Vocal creators now have the option to sign up for a Vocal+ membership for either $9.99 monthly or $99 annually, though these amounts are occasionally subject to promotional discounts. Vocal+ subscribers receive access to value-added features such as increased rate of cost per mille (thousand) (“CPM”) monetization, a decreased minimum withdrawal threshold, a discount on platform processing fees, member badges for their profiles, access to exclusive Vocal+ Challenges, and early access to new Vocal features. Subscription revenues stem from both monthly and annual subscriptions, the latter of which is amortized over a twelve-month period. Any customer payments received are recognized over the subscription period, with any payments received in advance being deferred until they are earned.   
v3.21.2
Significant Accounting Policies and Practices (Details) - Schedule of consolidated subsidiaries and/or entities
 6 Months Ended
Jun. 30, 2021
Jerrick Ventures LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
Abacus Tech Pty Ltd [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Australia
State or other jurisdiction of incorporation or organization 100%
Seller’s Choice, LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate New Jersey
State or other jurisdiction of incorporation or organization 100%
Recreatd, LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
Give, LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
Creatd Partners LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
Plant Camp LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 89%
Sci-Fi Shop, LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
OG Collection LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
VMENA LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
Vocal For Brands, LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
Vocal Ventures LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
What to Buy, LLC [Member]  
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]  
Name of combined affiliate Delaware
State or other jurisdiction of incorporation or organization 100%
v3.21.2
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis
Jun. 30, 2021
USD ($)
Fair value on recurring basis [Member]  
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items]  
Marketable securities - debt securities
Total assets
Derivative liabilities 436,295
Total Liabilities 436,295
Fair value on recurring basis [Member] | Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) [Member]  
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items]  
Marketable securities - debt securities
Total assets
Derivative liabilities
Total Liabilities
Fair value on recurring basis [Member] | Quoted Prices for Similar Assets or Liabilities in Active Markets (Level 2) [Member]  
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items]  
Marketable securities - debt securities
Total assets
Derivative liabilities
Total Liabilities
Fair value on recurring basis [Member] | Significant Unobservable Inputs (Level 3) [Member]  
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items]  
Marketable securities - debt securities
Total assets
Derivative liabilities 436,295
Total Liabilities 436,295
Fair value on non-recurring basis [Member]  
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items]  
Total assets 367,096
Equity investments, at cost 367,096
Fair value on non-recurring basis [Member] | Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) [Member]  
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items]  
Total assets
Equity investments, at cost
Fair value on non-recurring basis [Member] | Quoted Prices for Similar Assets or Liabilities in Active Markets (Level 2) [Member]  
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items]  
Total assets
Equity investments, at cost
Fair value on non-recurring basis [Member] | Significant Unobservable Inputs (Level 3) [Member]  
Significant Accounting Policies and Practices (Details) - Schedule of relevant assets and liabilities that are measured at fair value on a recurring basis [Line Items]  
Total assets 367,096
Equity investments, at cost $ 367,096
v3.21.2
Significant Accounting Policies and Practices (Details) - Schedule of fair value measurement inputs and valuation techniques
 6 Months Ended
Jun. 30, 2021
USD ($)
Marketable securities - debt securities [Member]  
Fair Value Measurement Inputs and Valuation Techniques [Line Items]  
Fair Value
Valuation Methodology Discounted cash flow analysis
Unobservable Inputs Expected cash flows from the investment
Derivative liabilities [Member]  
Fair Value Measurement Inputs and Valuation Techniques [Line Items]  
Fair Value $ 436,295
Valuation Methodology Monte Carlo simulations and Binomial model
Unobservable Inputs Risk free rate   Expected volatility; Drift rate
Equity investments, at cost [Member]  
Fair Value Measurement Inputs and Valuation Techniques [Line Items]  
Fair Value $ 367,096
Valuation Methodology Qualitative assessment per ASC 321-10-35
Unobservable Inputs Qualitative factors
v3.21.2
Significant Accounting Policies and Practices (Details) - Schedule of changes in marketable securities - USD ($)
 3 Months Ended 6 Months Ended
Jun. 30, 2021
Jun. 30, 2021
Significant Accounting Policies and Practices (Details) - Schedule of changes in marketable securities [Line Items]    
Beginning of period $ 317,096 $ 217,096
Purchase of equity investments 50,000 150,000
Ending of period 367,096 367,096
Marketable securities - debt securities [Member]    
Significant Accounting Policies and Practices (Details) - Schedule of changes in marketable securities [Line Items]    
Beginning of period 62,733 62,733
Purchase of marketable securities
Interest due at maturity
Other than temporary impairment (62,733) (62,733)
Conversion of marketable securities
Ending of period
v3.21.2
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue - USD ($)
 3 Months Ended 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Jun. 30, 2021
Jun. 30, 2020
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items]        
Net revenue $ 970,857 $ 322,540 $ 1,714,770 $ 615,682
Agency (Managed Services + Branded Content) [Member]        
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items]        
Net revenue 488,836 258,834 917,136 507,085
Platform (Creator Subscriptions) [Member]        
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items]        
Net revenue 451,965 54,972 758,867 90,934
Ecommerce [Member]        
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items]        
Net revenue 5,526 5,526
Affiliate Sales [Member]        
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items]        
Net revenue 7,798 8,195 15,806 16,344
Other revenue [Member]        
Significant Accounting Policies and Practices (Details) - Schedule of revenue disaggregated by revenue [Line Items]        
Net revenue $ 16,732 $ 539 $ 17,435 $ 1,319
v3.21.2
Significant Accounting Policies and Practices (Details) - Schedule of revenue recognition - USD ($)
 3 Months Ended 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Jun. 30, 2021
Jun. 30, 2020
Schedule of revenue recognition [Abstract]        
Products and services transferred over time $ 940,801 $ 313,806 $ 1,676,003 $ 598,019
Products transferred at a point in time 30,056 8,734 38,767 17,663
Revenue recognition $ 970,857 $ 322,540 $ 1,714,770 $ 615,682
v3.21.2
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents - shares
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items]    
Common stock equivalents, total 10,868,055 2,956,475
Warrants [Member]    
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items]    
Common stock equivalents, total 7,496,070 936,240
Options [Member]    
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items]    
Common stock equivalents, total 2,363,187 452,523
Convertible notes - related party [Member]    
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items]    
Common stock equivalents, total 5,574
Convertible notes [Member]    
Significant Accounting Policies and Practices (Details) - Schedule of common stock equivalents [Line Items]    
Common stock equivalents, total 1,008,798 1,562,138
v3.21.2
Going Concern (Details)
$ in Millions
 6 Months Ended
Jun. 30, 2021
USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Accumulated deficit $ 87.5
Net loss 15.2
Net cash used in operating activities $ 11.0
v3.21.2
Equity Investments, at Cost (Details) - USD ($)
May 27, 2021
May 21, 2021
Feb. 17, 2021
Oct. 23, 2020
Oct. 02, 2020
Investment Holdings [Abstract]          
Marketable debt security         $ 102,096
Converted into shares of preferred stock (in Shares)         119,355
Equity investment ownership percentage   10.00% 3.30% 3.80% 1.30%
Purchase of ownership amount $ 110,000 $ 50,000 $ 100,000 $ 115,000  
v3.21.2
Notes Payable (Details) - USD ($)
 6 Months Ended
Apr. 09, 2021
Oct. 06, 2020
Sep. 11, 2019
Jun. 30, 2021
Mar. 11, 2020
Nov. 24, 2020
May 04, 2020
Apr. 30, 2020
Notes Payable (Details) [Line Items]                
Interest rate         9.50%      
Accrued Interest       $ 114        
Principal repaid       $ 86,525        
Principal repaid, description       During the six months ended June 30, 2021, the Company repaid $136,597 in principal and was forgiven $275,903 of principal and $3,119 of accrued interest.         
Loan agreement, description   the Company entered into a secured loan agreement (the “October 2020 Loan Agreement”) with a lender (the “October 2020 Lender”), whereby the October 2020 Lender issued the Company a secured promissory note of A$74,300 AUD or $56,796 United States Dollars (the “October 2020 Note”). Pursuant to the October 2020 Loan Agreement, the October 2020 Note has an effective interest rate of 14%. The maturity date of the October 2020 Note is September 30, 2021 (the “October 2020 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the October 2020 Loan Agreement are due. The loan is secured by the Australian research & development credit.During the six months ended June 30, 2021, the Company accrued A$5,158 in interest.  The November 2020 Loan Agreement On November 24, 2020, the Company entered into a loan agreement (the “November 2020 Loan Agreement”) with a lender (the “November 2020 Lender”) whereby the November 2020 Lender issued the Company a promissory note of $34,000 (the “November 2020 Note”). Pursuant to the November 2020 Loan Agreement, the November 2020 Note has an effective interest rate of 14%. The maturity date of the November 2020 Note is May 25, 2021 (the “November 2020 Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under the November 2020 Note are due. During the six months ended June 30, 2021, the Company repaid $23,716 in principal and $4,736 of accrued interest. The February 2021 Loan Agreement On February 24, 2021, the Company entered into a secured loan agreement (the “February 2021 Loan Agreement”) with a lender (the “February 2021 Lender”), whereby the February 2021 Lender issued the Company a secured promissory note of A$111,683 AUD or $85,372 United States Dollars (the “February 2021 Note”). Pursuant to the February 2021 Loan Agreement, the February 2021 Note has an effective interest rate of 14%. The maturity date of the February 2021 Note is July 31, 2021 (the “February 2021 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the February 2021 Loan Agreement are due. The loan is secured by the Australian research & development credit            
Promissory note issue $ 128,110              
The april 2021 loan agreement The maturity date of the April 2021 Note is October 8, 2022 (the “April 2021 Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under the April 2021 Note are due.              
Seller’s Choice Note [Member]                
Notes Payable (Details) [Line Items]                
Principal amount     $ 660,000          
Increase in interest rate due to automatic extension     5.00%          
Accrued Interest       $ 98,186        
Interest Rate       30.00%        
The April 2020 PPP Loan Agreement [Member]                
Notes Payable (Details) [Line Items]                
Principal amount               $ 282,432
Interest Rate               1.00%
Accrued interest       $ 1,145        
Principal repaid       30,000        
The May 2020 PPP Loan Agreement [Member]                
Notes Payable (Details) [Line Items]                
Accrued Interest       1,017        
Principal amount             $ 412,500  
Interest Rate             1.00%  
The October 2020 Loan Agreement [Member]                
Notes Payable (Details) [Line Items]                
Accrued interest       5,158        
The November 2020 Loan Agreement [Member]                
Notes Payable (Details) [Line Items]                
Accrued Interest       4,736        
Interest Rate           14.00%    
Principal repaid       23,716        
Promissory note           $ 34,000    
The February 2021 Loan Agreement [Member]                
Notes Payable (Details) [Line Items]                
Accrued interest       $ 5,398        
v3.21.2
Notes Payable (Details) - Schedule of notes payable - USD ($)
 6 Months Ended
Jun. 30, 2021
Dec. 31, 2020
Debt Instrument [Line Items]    
Outstanding Principal, Total $ 1,096,185 $ 1,434,576
Outstanding Principal, Less: Debt Discount (7,549)
Outstanding Principal,Less: Debt Issuance Costs
Outstanding Principal, Less: Debt Total 1,088,636 1,434,576
Outstanding Principal, Less: Current Debt (1,054,600) (1,221,539)
Outstanding Principal, Total Long-Term Debt 34,036 213,037
The May 2020 PPP Loan Agreement [Member]    
Debt Instrument [Line Items]    
Outstanding Principal, Total $ 252,432 412,500
Interest Rate 1.00%  
Maturity Date, description April 2022  
The April 2020 PPP Loan Agreement [Member]    
Debt Instrument [Line Items]    
Outstanding Principal, Total 282,432
Interest Rate 1.00%  
Maturity Date, description May 2022  
The October 2020 Loan Agreement [Member]    
Debt Instrument [Line Items]    
Outstanding Principal, Total $ 56,796 55,928
Interest Rate 14.00%  
Maturity Date, description July 21  
The November 2020 Loan Agreement [Member]    
Debt Instrument [Line Items]    
Outstanding Principal, Total 23,716
Interest Rate 14.00%  
Maturity Date, description May 2021  
The February 2021 Loan Agreement [Member]    
Debt Instrument [Line Items]    
Outstanding Principal, Total $ 85,372
Interest Rate 14.00%  
Maturity Date, description July 21  
The April 2021 Loan Agreement [Member]    
Debt Instrument [Line Items]    
Outstanding Principal, Total $ 41,585
Interest Rate 10.00%  
Maturity Date, description October 22  
Seller’s Choice Note [Member]    
Debt Instrument [Line Items]    
Outstanding Principal, Total $ 660,000 $ 660,000
Interest Rate 30.00%  
Maturity Date, description September 2020  
v3.21.2
Convertible Note Payable (Details) - USD ($)
 1 Months Ended 6 Months Ended 12 Months Ended
Dec. 09, 2020
Jul. 01, 2020
May 31, 2021
Dec. 30, 2020
Sep. 23, 2020
Jul. 29, 2020
Jun. 30, 2021
Jun. 30, 2020
Dec. 31, 2020
Dec. 02, 2020
Oct. 02, 2020
Sep. 15, 2020
Aug. 31, 2020
Jul. 02, 2020
Convertible Note Payable (Details) [Line Items]                            
Note accrues interest rate                       7.00%    
Derivative liability   $ 112,743                        
Debt discount   68,000                        
Derivative liability   $ 44,743                        
Principal amount of convertible notes             $ 68,000              
Repaid of interest             3,400              
Debt Instrument, Unamortized Discount, Current             2,174,294   $ 309,637          
Derivative liability                   $ 108,880        
Debt issuance costs                        
Converted shares principal (in Shares)             169,400              
Interest on conversion shares             $ 4,620              
Common stock shares (in Shares)             55,631              
Gross proceeds     $ 3,690,491                      
Price per share (in Dollars per share)     $ 1                      
Conversion Price Per Share (in Dollars per share)     $ 5.00                      
Warrants issued (in Shares)     1,090,908                      
Debt discount             $ (12,110)   $ (17,068)          
Warrants issued     $ 1,090,908       $ 1,601,452 $ 752,136            
Debt discount related to original issue     666,669                      
The First July 2020 convertible Loan Agreement [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Principal amount of convertible notes (in Shares)   68,000                        
Note accrues interest rate   10.00%                        
Interest and principal both due date           Jun. 29, 2021                
Maturity date, description             Upon default or 180 days after issuance the First July 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to 61% multiplied by the lowest trade of the common stock during the twenty (15) consecutive trading day period immediately preceding the date of the respective conversion              
The August 2020 convertible Loan Agreement [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Note accrues interest rate                         12.00%  
Debt discount             $ 65,000              
Derivative liability             55,759              
Repaid of interest             3,400              
Common stock issued             29,859              
Promissory note                         $ 68,000  
Debt Instrument, Unamortized Discount, Current             3,000              
Derivative liability                         $ 120,759  
Converted principal amount             68,000              
The September 2020 convertible Loan Agreement [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Note accrues interest rate         12.00%                  
Maturity date, description         Upon default or 180 days after issuance the Second July 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share equal to the closing bid price of the Company’s common stock on the trading day immediately preceding the date of the respective conversion.                   
Debt discount             146,393              
Promissory note         $ 385,000                  
Debt issuance costs             $ 68,255              
Warrants purchase of common stock (in Shares)             85,555              
Repaid             $ 341,880              
Debt interest payable             46,200              
The October 2020 convertible Loan Agreement [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Note accrues interest rate                     6.00%      
Debt discount                     $ 19,400      
Promissory note                     $ 169,400      
Derivative liability                           $ 74,860
The First December 2020 convertible Loan Agreement [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Note accrues interest rate 12.00%                          
Maturity date, description Upon default the First December 2020 Note is convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) equal to the closing bid price of the Company’s common stock on the trading day immediately preceding the date of the respective conversion.                           
Debt discount $ 113,481                          
Debt issuance costs $ 110,300                          
Repaid             600,000              
Debt interest payable             4,340              
Common stock shares (in Shares) 600,000                          
Issuance of warrants (in Shares) 45,000                          
The Second December 2020 convertible Loan Agreement [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Note accrues interest rate       6.00%                    
Maturity date, description       Upon default the Second December 2020 Note is convertible into shares of the Company’s common stock, par value $0.001 per share (“Conversion Shares”) equal to 75% of average the lowest three trading prices of the Company’s common stock on the fifteen-trading day immediately preceding the date of the respective conversion.                     
Debt discount       $ 18,900                    
Promissory note       $ 169,400                    
The May 2021 Convertible Note [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Debt issuance costs     539,509                      
Debt discount     $ 1,601,452                      
Convertible Common Stock [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Common stock issued             $ 35,469              
Convertible Common Stock [Member] | The First December 2020 convertible Loan Agreement [Member]                            
Convertible Note Payable (Details) [Line Items]                            
Common stock issued $ 45,000                          
v3.21.2
Convertible Note Payable (Details) - Schedule of convertible notes payable - USD ($)
 6 Months Ended
Jun. 30, 2021
Dec. 31, 2020
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items]    
Outstanding Principal $ 4,836,069 $ 1,280,680
Less: Debt Discount (2,174,294) (309,637)
Less: Debt Issuance Costs (495,327) (73,527)
Total 2,166,448 897,516
Less: Current Debt (67,048) (897,516)
Total Long-Term Debt 2,099,400
The September 2020 convertible Loan Agreement [Member]    
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items]    
Outstanding Principal 341,880
Interest Rate 12.00%  
Conversion Price (in Dollars per share) [1]  
Maturity Date September-21  
Warrants granted, Quantity (in Shares) 85,555  
Warrants granted, Exercise Price (in Shares) 5  
The First December 2020 convertible Loan Agreement [Member]    
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items]    
Outstanding Principal 600,000
Interest Rate 12.00%  
Conversion Price (in Dollars per share) [1]  
Maturity Date December-21  
Warrants granted, Quantity (in Shares)  
Warrants granted, Exercise Price (in Shares)  
The October 2020 convertible Loan Agreement [Member]    
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items]    
Outstanding Principal 169,400
Interest Rate 6.00%  
Conversion Price (in Dollars per share) [1]  
Maturity Date October-21  
Warrants granted, Quantity (in Shares)  
Warrants granted, Exercise Price (in Shares)  
The Second December 2020 convertible Loan Agreement [Member]    
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items]    
Outstanding Principal $ 169,400 169,400
Interest Rate 6.00%  
Conversion Price (in Dollars per share) [1]  
Maturity Date December-21  
Warrants granted, Quantity (in Shares)  
Warrants granted, Exercise Price (in Shares)  
May 2021 Loan [Member]    
Convertible Note Payable (Details) - Schedule of convertible notes payable [Line Items]    
Outstanding Principal $ 4,666,669
Interest Rate  
Conversion Price (in Dollars per share) [1] $ 5.00  
Maturity Date November-22  
Warrants granted, Quantity (in Shares) 1,090,908  
Warrants granted, Exercise Price (in Shares) 0  
[1] As subject to adjustment as further outlined in the notes
v3.21.2
Related Party (Details) - USD ($)
 1 Months Ended 6 Months Ended
Sep. 14, 2020
Sep. 30, 2020
Sep. 15, 2020
Jun. 30, 2021
Dec. 02, 2020
Related Party (Details) [Line Items]          
Whole derivative laibility         $ 108,880
Accrued interest       $ 114  
Interest rate     7.00%    
Living expenses       72,328  
Loan agreement, description the Company’s common stock issued to the lender in accordance with the Lender’s Exchange Agreement (see note 11) have a value equal to or less than $6,463,363 determined by using the lowest VWAP of the last 30 days prior to September 14, 2021. The principal amount of the September 2020 Goldberg Note shall increase by 200% of the difference between the initial consideration and the September 14, 2021 value. the Company’s common stock issued to the lender in accordance with the Lender’s Exchange Agreement (see note 11) have a value equal to or less than $1,274,553 determined by using the lowest VWAP of the last 30 days prior to September 14, 2021. The principal amount of the September 2020 Rosen Note shall increase by 200% of the difference the initial consideration and the September 14, 2021 value.      
The September 2020 Goldberg Loan Agreement [Member]          
Related Party (Details) [Line Items]          
Promissory note     $ 16,705    
Interest rate     7.00%    
Maturity date     The maturity date of the September 2020 Goldberg Note is September 15, 2022 (the “September 2020 Goldberg Maturity Date”), at which time all outstanding principal, accrued and unpaid interest and other amounts due under note are due.    
Whole derivative laibility     $ 2,557,275    
Loss on extinguishment of debt     2,540,570    
Debt discount     16,705    
Accrued interest       $ 580  
The September 2020 Rosen Loan Agreement [Member]          
Related Party (Details) [Line Items]          
Promissory note     $ 3,295    
Whole derivative laibility   $ 504,413      
Loss on extinguishment of debt   501,118      
Debt discount   $ 3,295      
v3.21.2
Related Party (Details) - Schedule of convertible notes payable - related party - USD ($)
 6 Months Ended 12 Months Ended
Jun. 30, 2021
Dec. 31, 2020
Related Party (Details) - Schedule of convertible notes payable - related party [Line Items]    
Notes payable - related party, gross $ 20,000 $ 20,000
Less: Debt Discount (12,110) (17,068)
Less: Debt Issuance Costs
Notes payable 7,890 2,932
Less: Current Debt (7,890) (2,932)
Notes payable - related party, net  
The September 2020 Goldberg Loan Agreement [Member]    
Related Party (Details) - Schedule of convertible notes payable - related party [Line Items]    
Notes payable - related party, gross $ 16,705 16,705
Interest Rate 7.00%  
Maturity Date September 2022  
Warrants granted, Quantity (in Shares)  
Warrants granted, Exercise Price (in Dollars per share)  
The September 2020 Rosen Loan Agreement [Member]    
Related Party (Details) - Schedule of convertible notes payable - related party [Line Items]    
Notes payable - related party, gross $ 3,295 $ 3,295
Interest Rate 7.00%  
Maturity Date September 2022  
Warrants granted, Quantity (in Shares)  
Warrants granted, Exercise Price (in Dollars per share)  
v3.21.2
Derivative Liabilities (Details)
 6 Months Ended
Jun. 30, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Expected dividend yield, percentage 0.00%
v3.21.2
Derivative Liabilities (Details) - Schedule of changes in the derivative liabilities - USD ($)
 3 Months Ended 6 Months Ended
Jun. 30, 2021
Jun. 30, 2021
Level 1 [Member]    
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]    
Derivative liabilities at starting
Addition
Changes in fair value
Derivative liabilities at ending
Level 2 [Member]    
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]    
Derivative liabilities at starting
Addition
Changes in fair value
Derivative liabilities at ending
Level 3 [Member]    
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]    
Derivative liabilities at starting 344,404 42,231
Addition 108,880 417,241
Extinguishment (82,431) (286,009)
Changes in fair value 65,442 262,831
Derivative liabilities at ending $ 436,295 $ 436,295
v3.21.2
Stockholders’ Equity (Details) - USD ($)
 1 Months Ended 3 Months Ended 6 Months Ended 12 Months Ended
Feb. 04, 2021
Jul. 17, 2021
Jun. 17, 2021
Dec. 29, 2020
Aug. 17, 2020
Jun. 30, 2021
Jun. 30, 2020
Jun. 30, 2021
Jun. 30, 2020
Dec. 31, 2018
Jul. 20, 2021
May 24, 2021
Apr. 21, 2021
Apr. 10, 2021
Mar. 31, 2021
Mar. 28, 2021
Mar. 17, 2021
Feb. 26, 2021
Feb. 18, 2021
Feb. 08, 2021
Feb. 03, 2021
Feb. 01, 2021
Jan. 20, 2021
Jan. 14, 2021
Jul. 13, 2020
Stockholders’ Equity (Details) [Line Items]                                                  
Shares of capital stock                                                 (35,000,000)
Designated of common stock shares                                                 (15,000,000)
Common stock, par value (in Dollars per share)                                                 $ 0.001
Designated of preferred stock                                                 (20,000,000)
Preferred stock, par value (in Dollars per share)                                                 $ 0.001
Issuance shares of common stock                                                 100,000,000
Issuance of preferred stock                                                 20,000,000
Reverse stock split, description         On August 17, 2020, following board of directors approval, the Company filed a Certificate of Change to its Articles of Incorporation (the “Amendment”), with the Secretary of State of the State of Nevada to effectuate a one-for-twenty (1:3) reverse stock split (the “Reverse Stock Split”) of its common stock, par value $0.001 per share, without any change to its par value.                                        
Exercise price (in Dollars per share)       $ 4.50                                          
Subscription receivable (in Dollars)           $ 40,000   $ 40,000                                  
Issuance cost (in Dollars)               $ 4,225                                  
Converted shares               169,400                                  
Restricted common stock                           16,275 13,113 31,782 9,624 291 10,000   1,929 50,000 40,000 30,000  
Fair value (in Dollars)                   $ 57,123   $ 34,500 $ 3,587 $ 69,332 $ 43,667 $ 125,000 $ 49,371 $ 1,499 $ 48,000 $ 7,502 $ 8,198 $ 196,000 $ 192,000 $ 133,200  
Additional common stock   112,500                   10,000                          
Share based payments (in Dollars)           99,908   $ 99,908                                  
Total common stock shares                         1,048             2,092          
Loss on settlement of vendors liabilities (in Dollars)               $ 12,719                                  
Aggregate common stock shares   750,000                                              
Common stock per share (in Dollars per share)   $ 3.40                 $ 3.52                            
Net proceeds (in Dollars)   $ 2,213,500                                              
Warrants issued   46,667 46,667         1,090,908                                  
Warrant exercise price (in Dollars per share)   $ 5.40                                              
Grant options                   11,667                              
Share based payments (in Dollars)           1,940,250 $ 1,602,649 $ 3,510,489 $ 1,994,792                                
Unrecognized compensation expense, total (in Dollars)           6,122,329   $ 6,122,329                                  
Weighted average remaining life               1 year 2 months 23 days                                  
Warrant to purchase of common stock               320,693                                  
Issued common stock               376,214                                  
Received exercise of warrants (in Dollars)               $ 1,272,672                                  
Fair value of Warrants (in Dollars)               $ 3,067,617                                  
Additional warrent issue               127,801                                  
Deemed dividend (in Dollars)           410,750 $ 410,750                                
Share-based awards, restricted stock award, description the Company shall pay each member of the Board, for each calendar quarter during which such member continues to serve on the Board, compensation as a group amounts to $62,500 per quarter. The shares vest one year after issuance.                                                
Stock-based compensation for RSA’ amount (in Dollars)           $ 291,035   291,035                                  
Common Stock [Member]                                                  
Stockholders’ Equity (Details) [Line Items]                                                  
Restricted common stock                                     10,417            
Fair value (in Dollars)                                     $ 50,002            
Stock option [Member]                                                  
Stockholders’ Equity (Details) [Line Items]                                                  
Share based payments (in Dollars)               $ 2,552,855                                  
Series E Convertible Preferred Stock [Member]                                                  
Stockholders’ Equity (Details) [Line Items]                                                  
Preferred stock, description       the Company entered into securities purchase agreements with thirty-three accredited investors whereby the Investors have agreed to purchase from the Company an aggregate of 7,778 shares of the Company’s Series E Convertible Preferred Stock, par value $0.001 per share and 2,831,715 warrants to purchase shares of the Company’s common stock, par value $0.001 per share. The Series E Preferred Stock is convertible into a total of 1,887,810 shares of Common Stock. The combined purchase price of one Conversion Share and one and a half warrant was $4.12. The aggregate purchase price for the Series E Preferred Stock and warrants was $7,777,777. The Company has recorded $817,353 to stock issuance costs, which are part of Additional Paid-in Capital.                                          
Warrants, description       The placement agent for the transaction and received cash compensation equal to 10% of the aggregate purchase price and warrants to purchase 471,953 shares of the Company’s common stock, at an exercise price of $5.15 per share (the “PA Warrants”). The PA Warrants are exercisable for a term of five-years from the date of issuance.                                           
Converted shares               6,730                                  
Common stock shares               1,633,439                                  
Warrants issued               486,516                                  
v3.21.2
Stockholders’ Equity (Details) - Schedule of assumptions options granted - Options [Member]
 6 Months Ended
Jun. 30, 2021
$ / shares
Stockholders’ Equity (Details) - Schedule of assumptions options granted [Line Items]  
Expected dividends 0.00%
Minimum [Member]  
Stockholders’ Equity (Details) - Schedule of assumptions options granted [Line Items]  
Exercise price (in Dollars per share) $ 2.55
Expected volatility 223.15%
Risk free interest rate 0.46%
Expected life of option 5 years
Maximum [Member]  
Stockholders’ Equity (Details) - Schedule of assumptions options granted [Line Items]  
Exercise price (in Dollars per share) $ 14.10
Expected volatility 242.98%
Risk free interest rate 0.98%
Expected life of option 7 years
v3.21.2
Stockholders’ Equity (Details) - Schedule of the stock option activity - Stock Option [Member]
 6 Months Ended
Jun. 30, 2021
$ / shares
shares
Stockholders’ Equity (Details) - Schedule of the stock option activity [Line Items]  
Options beginning balance 541,021
Weighted Average Exercise Price beginning balance (in Dollars per share) | $ / shares $ 12.75
Weighted Average Remaining Contractual Life (in years) beginning balance 3 years 3 months 7 days
Options Granted 1,825,500
Weighted Average Exercise Price Granted 6.37
Weighted Average Remaining Contractual Life (in years) Granted 6 years 2 months 15 days
Options Exercised
Weighted Average Exercise Price Exercised (in Dollars per share) | $ / shares
Weighted Average Remaining Contractual Life (in years) Exercised
Options Forfeited/Cancelled (3,334)
Weighted Average Exercise Price Forfeited/Cancelled (in Dollars per share) | $ / shares $ 15.00
Weighted Average Remaining Contractual Life (in years) Forfeited/Cancelled
Options outstanding ending balance 2,363,187
Weighted Average Exercise Price outstanding ending balance (in Dollars per share) | $ / shares $ 7.82
Weighted Average Remaining Contractual Life (in years) outstanding ending balance 5 years 1 month 17 days
v3.21.2
Stockholders’ Equity (Details) - Schedule of outstanding and exercisable
 6 Months Ended
Jun. 30, 2021
$ / shares
shares
Schedule of outstanding and exercisable [Abstract]  
Option Outstanding Exercise price | $ / shares $ 7.82
Option Outstanding Number Outstanding | shares 2,363,187
Option Outstanding Weighted Average Remaining Contractual Life (in years) 5 years 1 month 17 days
Option Exercisable Weighted Average Exercise Price | $ / shares $ 12.73
Option Exercisable Number Exercisable | shares 537,687
Option Exercisable Weighted Average Remaining Contractual Life (in years) 3 years 9 months 25 days
v3.21.2
Stockholders’ Equity (Details) - Schedule of assumptions warrant granted - Warrants [Member]
 6 Months Ended
Jun. 30, 2021
$ / shares
Stockholders’ Equity (Details) - Schedule of assumptions warrant granted [Line Items]  
Exercise price (in Dollars per share) $ 4.50
Expected dividends 0.00%
Expected volatility 237.14%
Risk free interest rate 0.82%
Expected life of warrant 5 years
v3.21.2
Stockholders’ Equity (Details) - Schedule of warrant activity - Warrant [Member]
 6 Months Ended
Jun. 30, 2021
$ / shares
shares
Stockholders’ Equity (Details) - Schedule of warrant activity [Line Items]  
Warrant, outstanding beginning balance | shares 6,130,948
Weighted Average Exercise Price, outstanding beginning balance | $ / shares $ 4.96
Warrant, Granted | shares 1,751,892
Weighted Average Exercise Price, Granted | $ / shares $ 5.68
Warrant, Exercised | shares (376,214)
Weighted Average Exercise, Exercised | $ / shares $ 4.67
Warrant, Forfeited/Cancelled | shares (10,556)
Weighted Average Exercise Price, Forfeited/Cancelled | $ / shares $ 24.00
Warrant, outstanding ending balance | shares 7,496,070
Weighted Average Exercise Price, outstanding ending balance | $ / shares $ 4.88
Warrant, exercisable | shares 7,496,070
Weighted Average Exercise Price, exercisable | $ / shares $ 4.88
v3.21.2
Stockholders’ Equity (Details) - Schedule of outstanding and exercisable - Warrant [Member]
 6 Months Ended
Jun. 30, 2021
$ / shares
shares
Class of Warrant or Right [Line Items]  
Warrants Outstanding, Exercise price $ 4.88
Warrants Outstanding, Number Outstanding (in Shares) | shares 7,496,070
Warrants Outstanding, Weighted Average Remaining Contractual Life (in years) 4 years 3 months 29 days
Warrants Outstanding, Weighted Average Exercise Price $ 4.88
Warrants Exercisable, Number Exercisable (in Shares) | shares 7,496,070
Warrants Exercisable, Weighted Average Exercise Price $ 4.33
v3.21.2
Stockholders’ Equity (Details) - Schedule of activity related to RSUs
 6 Months Ended
Jun. 30, 2021
USD ($)
$ / shares
RSAs non-vested at January 1, 2021 [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Total shares (in Dollars) | $
Grant date fair value
RSAs granted [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Total shares (in Dollars) | $ $ 69,635
RSAs granted [Member] | Minimum [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Grant date fair value $ 3.75
RSAs granted [Member] | Maximum [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Grant date fair value $ 4.32
RSAs vested [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Total shares (in Dollars) | $
Grant date fair value
RSAs forfeited [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Total shares (in Dollars) | $
Grant date fair value
RSAs non-vested June 30, 2021 [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Total shares (in Dollars) | $ $ 69,635
RSAs non-vested June 30, 2021 [Member] | Minimum [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Grant date fair value $ 375
RSAs non-vested June 30, 2021 [Member] | Maximum [Member]  
Stockholders’ Equity (Details) - Schedule of activity related to RSUs [Line Items]  
Grant date fair value $ 4.32
v3.21.2
Commitments and Contingencies (Details)
 1 Months Ended 6 Months Ended
May 05, 2018
USD ($)
m²
Apr. 01, 2019
USD ($)
m²
Jun. 30, 2021
USD ($)
Jun. 30, 2020
USD ($)
Commitments and Contingencies (Details) [Line Items]        
Commitments and contingencies, description     The CARES Act lifts certain deduction limitations originally imposed by the Tax Cuts and Jobs Act of 2017 (“2017 Tax Act”). Corporate taxpayers may carry back net operating losses (NOLs) originating between 2018 and 2020 for up to five years, which was not previously allowed under the 2017 Tax Act. The CARES Act also eliminates the 80% of taxable income limitations by allowing corporate entities to fully utilize NOL carryforwards to offset taxable income in 2018, 2019 or 2020. Taxpayers may generally deduct interest up to the sum of 50% of adjusted taxable income plus business interest income (30% limit under the 2017 Tax Act) for 2019 and 2020. The CARES Act allows taxpayers with alternative minimum tax credits to claim a refund in 2020 for the entire amount of the credits instead of recovering the credits through refunds over a period of years, as originally enacted by the 2017 Tax Act.   
Taxable income percentage     25.00%  
Property generally eligible term     15 years  
Bonus depreciation rate     100.00%  
Lease term 5 years 4 years    
Office space (in Square Meters) | m² 2,300 796    
Operating lease due amount $ 411,150 $ 108,229    
Leases and rental expenses     $ 53,869 $ 59,168
The May 2020 PPP Loan Agreement [Member]        
Commitments and Contingencies (Details) [Line Items]        
Repaid principal     136,597  
Forgiven principal     275,903  
Accrued interest     3,119  
Principle outstanding     $ 255,426  
v3.21.2
Commitments and Contingencies (Details) - Schedule of components of lease expense - USD ($)
 3 Months Ended 6 Months Ended
Jun. 30, 2021
Jun. 30, 2021
Schedule of components of lease expense [Abstract]    
Operating lease cost $ 20,117 $ 39,826
Short term lease cost 3,714 7,428
Total net lease cost $ 23,831 $ 47,254
v3.21.2
Commitments and Contingencies (Details) - Schedule supplemental cash flow and other information related to leases
 6 Months Ended
Jun. 30, 2021
USD ($)
Schedule supplemental cash flow and other information related to leases [Abstract]  
Operating lease payments $ 53,977
Weighted average remaining lease term (in years): 2 years
Weighted average discount rate: 13.00%
v3.21.2
Commitments and Contingencies (Details) - Schedule of future minimum payments required under the lease
Jun. 30, 2021
USD ($)
Schedule of future minimum payments required under the lease [Abstract]  
2021 $ 55,348
2022 114,627
2023 53,094
Total $ 223,069
v3.21.2
Acquisition (Details) - USD ($)
Jun. 04, 2021
Jun. 01, 2021
Acquisition (Details) [Line Items]    
Membership interests purchased $ 300,000 $ 175,000
Membership Interest Purchase Agreement [Member]    
Acquisition (Details) [Line Items]    
Purchase of acquired common shares 841,005 490,863
Plant Camp LLC [Member]    
Acquisition (Details) [Line Items]    
Issued and outstanding equity, percentage 89.00% 33.00%
v3.21.2
Acquisition (Details) - Schedule of components of the purchase price
Jun. 30, 2021
USD ($)
Asset Acquisition [Line Items]  
Cash paid to seller $ 300,000
Fair value of equity investment purchased on June 1, 2021 175,000
Total purchase price 475,000
Cash 5,232
Accounts Receivable 7,645
Inventory 19,970
Total assets acquired 32,847
Accounts payable and accrued expenses 5,309
Deferred Revenue 671
Loan Payable 100,000
Total liabilities assumed 105,980
Net assets acquired (73,133)
Non-controlling interest in consolidated subsidiary 56,865
Excess purchase price 604,998
Know-How and Intellectual Property [Member]  
Asset Acquisition [Line Items]  
Excess purchase price 422,000
Website [Member]  
Asset Acquisition [Line Items]  
Excess purchase price 51,300
Customer Relationships [Member]  
Asset Acquisition [Line Items]  
Excess purchase price 24,000
Goodwill [Member]  
Asset Acquisition [Line Items]  
Excess purchase price 2,198
Trade Names & Trademarks [Member]  
Asset Acquisition [Line Items]  
Excess purchase price $ 105,500
v3.21.2
Subsequent Events (Details) - USD ($)
 1 Months Ended 6 Months Ended
Sep. 02, 2021
Jul. 28, 2021
Jul. 20, 2021
Jun. 30, 2021
Jul. 17, 2021
Jul. 08, 2021
May 27, 2021
May 21, 2021
Feb. 17, 2021
Oct. 23, 2020
Subsequent Events (Details) [Line Items]                    
Common stock at a price (in Dollars per share)     $ 3.52   $ 3.40          
Purchase price     $ 935,000              
Purchase price percentage     44.00%              
Fair value of the non-controlling interest     $ 1,190,000              
Issuance of common stock (in Shares)       55,631            
Converted outstanding debt       $ 3,525,000            
Issuance of common stock (in Shares)       705,000            
Deposit value             $ 110,000 $ 50,000 $ 100,000 $ 115,000
Subsequent Event [Member]                    
Subsequent Events (Details) [Line Items]                    
Aggregate closing consideration     935,000              
Consideration in cash     144,750              
Consideration in form of shares, value     $ 790,250              
Consideration in form of shares, shares (in Shares)     224,503              
Deposit value           $ 100,000        
Subsequent event description the Company entered into a Memorandum of Understanding to acquire a majority equity stake in Dune, Inc., a direct-to-consumer brand focused on promoting wellness through its range of health-oriented beverages. Pursuant to the MOU, Creatd intends to acquire a 50.4% equity stake in Dune in exchange for a combination of cash and stock. The Company expects to execute definitive agreements early in the fourth quarter 2021 and to close shortly thereafter, subject to the completion of due diligence and other closing conditions. the Company entered into a non-binding Memorandum of Understanding to purchase a majority stake in direct-to-consumer company, Wobble Wedge®. Wobble Wedges®, sold through both direct-to-consumer (DTC) and wholesale avenues, are an interlocking modular system of tapered shims that are adaptable to hundreds of uses. Pursuant to the MOU, Creatd intends to acquire a 55% equity stake in Wobble Wedge, in exchange for a combination of cash and stock consideration totaling $500,000. The Company expects to execute definitive agreements in early fourth quarter 2021 and to close shortly thereafter, subject to the completion of due diligence and other closing conditions.                
Stock Purchase Agreement [Member]                    
Subsequent Events (Details) [Line Items]                    
Purchase ownership     44.00%              
Vendor issued credit amount     $ 0.55              
Warrant [Member]                    
Subsequent Events (Details) [Line Items]                    
Number of warrants exercised (in Shares)     1,062,574              
Cancellation of warrants shares (in Shares)       1,062,574            
Issuance of common stock (in Shares)       954,568            
Gross proceeds       $ 4,199,396            
Series E Preferred Stock [Member]                    
Subsequent Events (Details) [Line Items]                    
Issuance of common stock (in Shares)       106,311            
Total warrants shares (in Shares)       438