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15 Nov 2023
$5.5M interest-free loans provided by investors to ease cash flow as the blue laser pioneer looks to recover.
Nuburu, the developer of blue industrial lasers that listed on the NYSE’s American Stock Exchange in early 2023, says it has agreed $5.5 million in bridge loans from investors in the company.
Initially interest-free and secured on the firm’s patent portfolio, the loans are intended to stabilize Nuburu’s cash position until longer-term credit finance is found.
The bridge financing was finalized just a few days after Nuburu’s new CEO Brian Knaley revealed that the company posted sales of less than $0.2 million in the third quarter of the year, pushing it to an operating loss of just over $5 million for the period - and leaving it with only $1.6 million in cash on its balance sheet.
Nuburu had initially hoped to raise as much as $330 million in its special-purpose acquisition company (SPAC) deal with backer Tailwind, however its subsequent US Security & Exchange Commission (SEC) filings indicate that only $3 million was raised at the time of the January listing - although in June the firm secured another $9 million from loan notes.
Knaley, who replaced Nuburu’s co-founder Mark Zediker as CEO just a week prior to the results announcement, was previously Nuburu’s CFO. Filings show that Zediker - said to be pursuing other opportunities - is set to receive $200,000 in cash as part of the separation agreement.
Scanner supply constraints
Discussing the latest trading period in an investor conference call, Nuburu’s executive chairman Ron Nicol said that sales in the September quarter had been impacted by problems securing a supply of laser scanning components - something that Zediker had referenced previously.
Nicol said those supply constraints had begun to ease by the end of September, adding that Nuburu had identified an alternative solution, with something of a rebound in laser system sales anticipated in the closing quarter of the year as a result.
However, the impact will likely see Nuburu post sales of only $2.1 million for the full year, well below prior expectations that the figure would exceed $3 million.
Nuburu's focus on blue lasers is intended to take advantage of the physics of light absorption, which sees metals - and colored metals like copper in particular - absorb light in the blue spectrum much more readily than in the red or near-infrared.
In principle that should lead to much more efficient and faster industrial laser processing with blue sources, but the technology relies on the relatively recent availability of reliable high-power laser diodes emitting in the blue.
Focusing on positive developments, Nicol was also keen to point out the completion of an SBIR contract with the US Air Force aimed at using blue lasers in combination with a digital mirror device that could lead to much faster 3D printing systems. Nuburu has since teamed up with GE Additive to develop a “print engine” based on the approach.
Nicol also pointed to a purchase order from a “major multinational electronics manufacturer” as evidence of the level of interest in its blue laser systems.
He added that the firm’s primary objectives were now to strengthen its commercial activity, scale manufacturing, and streamline administrative functions.
“The purchase order we’ve received from a major multinational electronics manufacturer stands as a testimony for the unbroken inbound of interest in our cutting-edge blue laser technology,” said the executive chairman.
“Our focus is now on further strengthening our distribution network. Combining the current growing end-markets with our extensive intellectual property and upcoming one-kilowatt blue laser system, Nuburu is well positioned to drive commercial success and execute against its long-term growth strategy.”
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