Fair Value Measurements (Tables)
|
9 Months Ended |
12 Months Ended |
Sep. 30, 2025 |
Dec. 31, 2024 |
| Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items] |
|
|
| Schedule of Fair Value on Recurring Basis |
The
following table presents information about the Company’s financial instruments that are measured at fair value on a recurring basis
at September 30, 2025 and December 31, 2024, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine
such fair value:
Schedule
of Fair Value on Recurring Basis
| Description | |
Level | |
September 30, 2025 | | |
December 31, 2024 | |
| Assets: | |
| |
| | | |
| | |
| Bifurcated embedded derivative asset - related party | |
3 | |
$ | 9,000 | | |
$ | 63,000 | |
| Definite-lived intangibles* | |
3 | |
$ | 3,903,320 | | |
$ | 3,903,320 | |
| Definite-lived intangibles** | |
3 | |
$ | 8,332,096 | | |
$ | 3,883,853 | |
| Goodwill - Vidello (Note
4)* | |
3 | |
$ | 3,019,246 | | |
$ | — | |
| Goodwill** | |
3 | |
$ | 21,991,721 | | |
$ | 18,972,475 | |
| Liabilities: | |
| |
| | | |
| | |
| Warrant liabilities - public | |
1 | |
$ | 667 | | |
$ | 2,300 | |
| GEM warrant liabilities | |
3 | |
$ | 2,000 | | |
$ | 15,000 | |
| Earnout liability (Note
4) | |
3 | |
$ | 962,693 | | |
$ | — | |
| Yorkville convertible note | |
3 | |
$ | 2,003,000 | | |
$ | — | |
| Agile teYorkvillerm notes | |
3 | |
$ | 2,482,000 | | |
$ | 3,143,000 | |
| 1800 Diagonal convertible notes | |
3 | |
$ | 825,000 | | |
$ | 432,000 | |
| Private Placement Convertible Notes | |
3 | |
$ | 2,304,000 | | |
$ | — | |
| Private Placement Warrants | |
3 | |
$ | 901,000 | | |
$ | — | |
| * | Certain assets
measured at the acquisition date. |
| ** | Measured at
period-end. |
|
The following table presents information about
the Company’s financial instruments that are measured at fair value on a recurring basis at December 31, 2024 and December 31, 2023,
and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
Schedule of Fair Value on Recurring Basis
| Description | |
Level | |
December 31, 2024 | | |
December 31, 2023 | |
| Assets: | |
| |
| | | |
| | |
| Bifurcated embedded derivative asset - related party | |
3 | |
$ | 63,000 | | |
$ | — | |
| Definite-lived intangibles* | |
3 | |
$ | 3,903,320 | | |
$ | — | |
| Definite-lived intangibles** | |
3 | |
$ | 3,883,853 | | |
$ | — | |
| Goodwill - OpenReel (Note 5)* | |
3 | |
$ | 19,526,409 | | |
$ | — | |
| Goodwill** | |
3 | |
$ | 18,972,475 | | |
$ | 2,171,526 | |
| Liabilities: | |
| |
| | | |
| | |
| Warrant liabilities - public | |
1 | |
$ | 2,300 | | |
$ | 575,000 | |
| GEM warrant liabilities | |
3 | |
$ | 15,000 | | |
$ | 641,000 | |
| Yorkville convertible note | |
3 | |
$ | — | | |
$ | 1,766,000 | |
| Agile term notes | |
3 | |
$ | 3,143,000 | | |
$ | — | |
| 1800 Diagonal convertible notes | |
3 | |
$ | 432,000 | | |
$ | — | |
| * | Certain assets measured at the acquisition date |
| ** | Measured at year-end impairment testing |
|
| Summary of Changes In Fair Value of Yorkville Convertible Note |
The
following tables set forth a summary of the changes in the fair value of the Yorkville convertible notes which is a Level 3 financial
liability measured at fair value on a recurring basis:
Summary of Changes In Fair Value of Yorkville Convertible Note
| | |
Fair Value | |
| Balance at December 31, 2024 | |
$ | - | |
| Issuance of Yorkville convertible note | |
| 4,950,000 | |
| Loss on debt issuance | |
| 444,000 | |
| Repayment in cash of Yorkville convertible notes | |
| (3,640,000 | ) |
| Change in fair value | |
| 249,000 | |
| Balance at September 30, 2025 | |
$ | 2,003,000 | |
|
The following tables set forth a summary of the
changes in the fair value of the Yorkville convertible notes which is a Level 3 financial liability measured at fair value on a recurring
basis:
Summary
of Changes In Fair Value of Yorkville Convertible Note
| | |
Fair Value | |
| Balance at December 31, 2023 | |
$ | 1,766,000 | |
| Issuance of Yorkville convertible note | |
| 2,250,000 | |
| Loss on debt issuance | |
| 171,000 | |
| Payment in shares to settle Yorkville convertible notes | |
| (4,130,000 | ) |
| Repayment in cash of Yorkville convertible notes | |
| (750,000 | ) |
| Change in fair value | |
| 693,000 | |
| Balance at December 31, 2024 | |
$ | — | |
|
| Schedule of Derivate Assets |
The
following table sets forth a summary of the changes in the fair value of the bifurcated embedded derivative asset for the nine months
ended September 30, 2025, relating to the Convertible Note to CP BF issued on September 23, 2024, which are Level 3 financial liabilities
that are measured at fair value on a recurring basis:
Schedule
of Derivate Assets
| | |
Fair Value | |
| | |
CP BF Convertible | |
| Balance at December 31, 2024 | |
$ | 63,000 | |
| Change in fair value | |
| (43,000 | ) |
| Balance at March 31, 2025 | |
| 20,000 | |
| Change in fair value | |
| (19,000 | ) |
| Balance at June 30, 2025 | |
| 1,000 | |
| Change in fair value | |
| 8,000 | |
| Balance at September 30, 2025 | |
$ | 9,000 | |
|
The following table sets forth a summary of the
changes in the fair value of the bifurcated embedded derivative asset for the year ended December 31, 2024, relating to the Convertible
Note to CP BF issued on September 23, 2024, which are Level 3 financial liabilities that are measured at fair value on a recurring basis:
Schedule
of Derivate Assets
| | |
Fair Value | |
| | |
CP BF Convertible | |
| Issuance of convertible notes with bifurcated embedded derivative asset | |
$ | 12,000 | |
| Change in fair value | |
| 51,000 | |
| Balance at December 31, 2024 | |
$ | 63,000 | |
| Balance | |
$ | 63,000 | |
|
| Schedule of Range of key Inputs at Issuance |
The
range of key inputs at issuance of the Agile term notes issued in 2025 and for the period ended September 30, 2025 were as follows:
Schedule of Range of key Inputs at Issuance
| | |
March 2025 Agile Note | | |
June 2025 Agile Note | |
| Key Inputs | |
September 30,
2025 | | |
March 31,
2025 | | |
September 30,
2025 | | |
June 12,
2025 | |
| Contractual term (years) | |
| 0.12 | | |
| 0.62 | | |
| 0.21 | | |
| 0.52 | |
| Interest rate | |
| 13.80 | % | |
| 13.12 | % | |
| 13.79 | % | |
| 15.95 | % |
|
The range of key inputs at issuance of the Agile
term notes and for the period ended December 31, 2024, were as follows:
Schedule of Range of key Inputs at Issuance
| | |
July Agile Note | | |
September Agile Note | | |
December Agile Note | |
| Key Inputs | |
July 22, 2024 | | |
December 12, 2024 | | |
September 13, 2024 | | |
December 12, 2024 | | |
December 12, 2024 | | |
December 31, 2024 | |
| Contractual term (years) | |
| 0.55 | | |
| - | | |
| 0.48 | | |
| 0.43 | | |
| 0.61 | | |
| 0.56 | |
| Interest rate | |
| 18.92 | % | |
| 9.30 | % | |
| 14.37 | % | |
| 9.33 | % | |
| 9.48 | % | |
| 10.13 | % |
|
| Summary of Inputs in Fair Value of the Private Placement Warrant Liability |
The
following tables set forth a summary of the ranges of inputs to and the changes in the fair value of the Private Placement Warrant liability
which are Level 3 financial liabilities that are measured at fair value on a recurring basis:
Summary
of Inputs in Fair Value of the Private Placement Warrant Liability
| Key Inputs | |
September 30, 2025 | |
| | |
| |
| Stock price | |
$ | 2.94 | |
| Contractual term (years) | |
| 2.75
- 4.89 | |
| Risk-free rate | |
| 0%
- 3.7 | % |
| Volatility(1) | |
| 98%
- 128 | % |
| Exercise Price | |
$ | 2.50-$3.13 | |
| Dividend yield | |
| 0.00 | % |
Summary of Inputs in Fair Value of the Private Placement Warrant Liability
| | |
Fair Value | |
| Balance at December 31, 2024 | |
$ | - | |
| Loss on issuance | |
| - | |
| Balance at March 31, 2025 | |
$ | - | |
| Loss on issuance | |
| 361,000 | |
| Balance at June 30, 2025 | |
$ | 361,000 | |
| Loss on issuance | |
| 356,000 | |
| Change in fair value | |
| 184,000 | |
| Balance at September 30, 2025 | |
$ | 901,000 | |
|
|
| Summary of Inputs in Fair Value of the Private Placement Warrant Liability |
Summary of Inputs in Fair Value of the Private Placement Warrant Liability
| | |
Fair Value | |
| Balance at December 31, 2024 | |
$ | - | |
| Loss on issuance | |
| - | |
| Balance at March 31, 2025 | |
$ | - | |
| Loss on issuance | |
| 361,000 | |
| Balance at June 30, 2025 | |
$ | 361,000 | |
| Loss on issuance | |
| 356,000 | |
| Change in fair value | |
| 184,000 | |
| Balance at September 30, 2025 | |
$ | 901,000 | |
|
|
| Schedule of Derivative Liabilities |
|
The following table sets forth a summary of the
changes in the fair value of the bifurcated embedded derivative liabilities for the year ended December 31, 2023, related to the Related
Party and Third Party Convertible Debt, respectively, which are Level 3 financial liabilities that are measured at fair value on a recurring
basis:
Schedule
of Derivative Liabilities
| | |
Related Party | | |
Third Party | |
| | |
Fair Value | |
| | |
Related Party | | |
Third Party | |
| Balance at December 31, 2022 | |
$ | 1,936,827 | | |
$ | 845,473 | |
| Issuance of convertible notes with bifurcated embedded derivative | |
| 1,126,451 | | |
| 559,390 | |
| Change in fair value | |
| (3,063,278 | ) | |
| (1,404,863 | ) |
| Balance at December 31, 2023 | |
$ | — | | |
$ | — | |
|
| Schedule of Fair Value Measurements |
|
The following tables set forth a summary of the
activity of the Related Party and Third Party SAFE liabilities, respectively (See Note 16 - Simple Agreements for Future Equity
for further detail), which represents a recurring fair value measurement at the end of the relevant reporting period:
Schedule
of Fair Value Measurements
| | |
Related Party | | |
Third Party | |
| | |
Fair Value | |
| | |
Related Party | | |
Third Party | |
| Balance at December 31, 2022 | |
$ | 8,802,196 | | |
$ | 663,804 | |
| Change in fair value | |
| (2,752,430 | ) | |
| (207,570 | ) |
| Conversion on SAFEs | |
| (6,049,766 | ) | |
| (456,234 | ) |
| Balance at December 31, 2023 | |
$ | — | | |
$ | — | |
|
| Schedule of Significant Unobservable Inputs Used in Fair Value Measurement |
|
The significant unobservable inputs used in our
level 3 fair value measurement of business combinations, including definite-lived intangibles at the acquisition date (Note and
5) are as follows:
Schedule of Significant Unobservable Inputs Used in Fair Value Measurement
| Area | |
Valuation Techniques | |
Unobservable Input | |
2024 | | |
2023 |
| Business Combination (Note 5) | |
Various * | |
Growth rate | |
| 5.8 | % | |
None |
| | |
| |
Weighted average cost of capital | |
| 13.5 | % | |
None |
| | |
| |
Internal rate of return | |
| 11.3 | % | |
None |
| | |
| |
| |
| | | |
|
| Customer Relationship (Note 5) | |
Distributor method | |
Long-term revenue growth rate | |
| 5.8 | % | |
None |
| | |
| |
Revenue growth attributable to exiting customers | |
| 50.0 | % | |
None |
| | |
| |
Existing customer attrition | |
| 20.0 | % | |
None |
| | |
| |
Distributor EBITA margin | |
| 7.5 | % | |
None |
| | |
| |
Contributory asset charges rate | |
| 0.9% - 1.4 | % | |
None |
| | |
| |
Weighted average cost of capital | |
| 13.5 | % | |
None |
| | |
| |
| |
| | | |
|
| Trade name (Note 5) | |
Relief-from-royalty method | |
Long-term revenue growth rate | |
| 5.8 | % | |
None |
| | |
| |
Royalty rate | |
| 2.0 | % | |
None |
| | |
| |
Contributory asset charges rate | |
| 1.5 | % | |
None |
| | |
| |
Weighted average cost of capital | |
| 13.5 | % | |
None |
| | |
| |
| |
| | | |
|
| Technology (Note 5) | |
Multi-period excess earnings method | |
Long-term revenue growth rate | |
| 5.8 | % | |
None |
| | |
| |
R&D expense for new developed technology | |
| 12.5 | % | |
None |
| | |
| |
Developed technology obsolescence rate | |
| 30.0 | % | |
None |
| | |
| |
Contributory asset charges rate | |
| 0.1%
- 2.2% | | |
None |
| | |
| |
Weighted average cost of capital | |
| 13.5 | % | |
None |
| * | Includes all of the valuation techniques for each of the fair valued assets above as of the
acquisition date (Note 5) |
Goodwill
The significant unobservable inputs used in our
level 3 fair value measurement of goodwill as of our annual impairment assessment date of December 31, 2024, are as follows (Notes
3 and 11):
| Area | |
Valuation Techniques | |
Unobservable Input | |
2024 | |
2023 |
| Goodwill | |
Discounted cash flow | |
Long-term revenue growth rate | |
5.8% | |
None |
| | |
| |
Cost of sales as a percentage of revenue | |
13.9% | |
None |
| | |
| |
Gross profit margin | |
86.1% | |
None |
| | |
| |
Operating expenses as a percentage of revenue | |
49.5% - 74.5% | |
None |
| | |
| |
EBITDA margin | |
11.6% - 36.6% | |
None |
| | |
| |
EBITDA growth rate | |
3.0% - 45.9% | |
None |
| | |
| |
Weighted average cost of capital | |
13.5% | |
None |
| | |
| |
| |
| |
|
| | |
Market - Guideline public company | |
Revenue multiples | |
2.9x - 3.10x | |
None |
| | |
| |
Weighting | |
25.0% - 50.0% | |
None |
| | |
| |
| |
| |
|
| | |
Market - Guideline transaction | |
Revenue multiple | |
3.25x | |
None |
|
| Diagonal Convertible Notes [Member] |
|
|
| Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items] |
|
|
| Schedule of Range of key Inputs at Issuance |
The
range of key inputs for the Black-Scholes simulations at issuance of the 1800 Diagonal convertible notes issued in 2025 and for the period
ended September 30, 2025, were as follows:
Schedule of Range of key Inputs at Issuance
| Key Inputs | |
September 30,
2025 | | |
April 17,
2025 | | |
September 30,
2025 | | |
May 9,
2025 | | |
September 30,
2025 | | |
July 23,
2025 | | |
September 30,
2025 | | |
September 12,
2025 | |
| | |
April 1800 Diagonal Note | | |
May 1800 Diagonal Note | | |
July 1800 Diagonal Note | | |
September 1800 Diagonal Note | |
| Key Inputs | |
September 30,
2025 | | |
April 17,
2025 | | |
September 30,
2025 | | |
May 9,
2025 | | |
September 30,
2025 | | |
July 23,
2025 | | |
September 30,
2025 | | |
September 12,
2025 | |
| Stock price | |
$ | 2.94 | | |
$ | 10.56 | | |
$ | 2.94 | | |
$ | 9.98 | | |
$ | 2.94 | | |
$ | 4.10 | | |
$ | 2.94 | | |
$ | 2.37 | |
| Contractual term (years) | |
| 0.38 | | |
| 0.84 | | |
| 0.38 | | |
| 0.78 | | |
| 0.67 | | |
| 0.86 | | |
| 0.72 | | |
| 0.77 | |
| Risk-free rate | |
| 4.02 | % | |
| 4.16 | % | |
| 4.02 | % | |
| 4.21 | % | |
| 3.90 | % | |
| 4.23 | % | |
| 3.89 | % | |
| 3.87 | % |
| Volatility(1) | |
| 142 | % | |
| 160 | % | |
| 142 | % | |
| 143 | % | |
| 134 | % | |
| 121 | % | |
| 131 | % | |
| 122 | % |
| Maturity probability | |
| 90 | % | |
| 80 | % | |
| 90 | % | |
| 80 | % | |
| 85 | % | |
| 80 | % | |
| 90 | % | |
| 85 | % |
| Default probability | |
| 10 | % | |
| 20 | % | |
| 10 | % | |
| 20 | % | |
| 15 | % | |
| 20 | % | |
| 10 | % | |
| 15 | % |
| Dividend yield | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % |
| Debt Instrument, Measurement Input | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % |
| (1) | The Company
utilized historical equity volatility in measurement of the fair value of the notes. |
|
The range of key inputs for the Black-Scholes
simulations at issuance of the 1800 Diagonal convertible notes and for the year ended December 31, 2024, were as follows:
Schedule of Range of key Inputs at Issuance
| Key Inputs | |
August 16, 2024 | | |
December 31, 2024 | | |
September 24, 2024 | | |
December 31, 2024 | | |
December 10, 2024 | | |
December 31, 2024 | |
| | |
August 1800 Diagonal Note | | |
September 1800 Diagonal Note | | |
December 1800 Diagonal Note | |
| Key Inputs | |
August 16, 2024 | | |
December 31, 2024 | | |
September 24, 2024 | | |
December 31, 2024 | | |
December 10, 2024 | | |
December 31, 2024 | |
| Stock price | |
$ | 55.80 | | |
$ | 15.30 | | |
$ | 82.40 | | |
$ | 15.30 | | |
$ | 20.50 | | |
$ | 15.30 | |
| Contractual term (years) | |
| 0.84 | | |
| 0.46 | | |
| 0.86 | | |
| 0.59 | | |
| 0.86 | | |
| 0.80 | |
| Risk-free rate | |
| 5.00 | % | |
| 4.25 | % | |
| 4.34 | % | |
| 4.23 | % | |
| 4.29 | % | |
| 4.19 | % |
| Volatility(1) | |
| 114 | % | |
| 191 | % | |
| 192 | % | |
| 264 | % | |
| 222 | % | |
| 232 | % |
| Maturity probability | |
| 80 | % | |
| 80 | % | |
| 80 | % | |
| 80 | % | |
| 75 | % | |
| 75 | % |
| Default probability | |
| 20 | % | |
| 20 | % | |
| 20 | % | |
| 20 | % | |
| 25 | % | |
| 25 | % |
| Dividend yield | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % |
| Debt Instrument, Measurement Input | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % |
| (1) | The Company utilized historical equity volatility in measurement of the fair value of the
notes. |
|
| Public Warrants Liability [Member] |
|
|
| Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items] |
|
|
| Summary of Changes in the Fair Value of the Warrants Liability |
The
following tables set forth a summary of the changes in the fair value of the Public Warrants liability which are Level 1 financial liabilities
that are measured at fair value on a recurring basis:
Summary
of Changes in the Fair Value of the Warrants Liability
| | |
Fair Value | |
| Balance at December 31, 2024 | |
$ | 2,300 | |
| Change in fair value | |
| 2,300 | |
| Balance at March 31, 2025 | |
| 4,600 | |
| Change in fair value | |
| - | |
| Balance at June 30, 2025 | |
| 4,600 | |
| Balance | |
| 4,600 | |
| Change in fair value | |
| (3,933 | ) |
| Balance at September 30, 2025 | |
$ | 667 | |
| Balance | |
$ | 667 | |
|
The following tables set forth a summary of the
changes in the fair value of the Public Warrants liability which are Level 1 financial liabilities that are measured at fair value on
a recurring basis:
Summary
of Changes in the Fair Value of the Warrants Liability
| | |
Fair Value | |
| Balance at December 31, 2023 | |
$ | 575,000 | |
| Change in fair value | |
| (572,700 | ) |
| Balance at December 31, 2024 | |
$ | 2,300 | |
|
| Gem Warrants Liability [Member] |
|
|
| Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items] |
|
|
| Summary of Changes in the Fair Value of the Warrants Liability |
The
following tables set forth a summary of the changes in the fair value of the GEM Warrants liability which are Level 3 financial liabilities
that are measured at fair value on a recurring basis:
Summary
of Changes in the Fair Value of the Warrants Liability
| | |
Fair Value | |
| Balance at December 31, 2024 | |
$ | 15,000 | |
| Change in fair value | |
| (4,000 | ) |
| Balance at March 31, 2025 | |
| 11,000 | |
| Change in fair value | |
| (8,000 | ) |
| Balance at June 30, 2025 | |
| 3,000 | |
| Change in fair value | |
| (1,000 | ) |
| Balance at September 30, 2025 | |
$ | 2,000 | |
|
The following tables set forth a summary of the
changes in the fair value of the GEM Warrants liability which are Level 3 financial liabilities that are measured at fair value on a recurring
basis:
Summary
of Changes in the Fair Value of the Warrants Liability
| | |
Fair Value | |
| Balance at December 31, 2023 | |
$ | 641,000 | |
| Change in fair value, Beginning balance | |
$ | 641,000 | |
| Change in fair value | |
| (626,000 | ) |
| Balance at December 31, 2024 | |
$ | 15,000 | |
| Change in fair value, Ending balance | |
$ | 15,000 | |
|