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Truth Social is strapped for cash and struggling to find new users

Truth Social is strapped for cash and facing technical and legal problems that could doom the future of former President Donald Trump’s personal social media platform.

The most immediate problem is the platform’s defunct SPAC, initially planned as a way to publicly trade shares in a new company without the attention of an IPO. But the SPAC has been delayed, leaving Digital World Acquisition Corp., which was expected to take ownership of Truth Social, in an awkward position. SEC filings show the company lost more than $6 million in the first half of this year, generated no revenue and held just $293 million in the trust that holds most of its assets.

DWAC’s stock price has declined nearly 75 percent of its value since its March peak — and in its SEC filing, the company said it needed more money to continue operating and sought to extend the SPAC merger past a Sept. 8 deadline.

But Truth Social’s financial woes are already affecting operations. Earlier this week, Fox business RightForge, a conservative Internet infrastructure company, reported that the company stopped paying in March and now owes the vendor at least $1.6 million in backdated payments. RightForge CEO Martin Avila said that while the company is “committed to servicing” Truth Social, the platform could lose its hosting services if it continues to withhold payments.

The social network’s biggest asset is Trump and the legions of fans who followed him after he was banned from Facebook, Twitter and YouTube in the wake of the Capitol riots. While the iOS app saw a spike in downloads shortly after the FBI warrant on Trump’s Mar-a-Lago residence, fundamental technical failures are still holding back growth. The app launched in February, but wasn’t widely available on Apple’s App Store until May. It is still not launched on Android operating systems Axios Reported due to “inadequate content moderation”.

In a statement on Tuesday, TMTG said it is working “in good faith with Google” to host Truth Social on the Google Play Store. “TMTG has no desire to litigate its business matters in the public arena, but for the record, has responded promptly to all inquiries from Google,” the statement said.

Trump himself does not care about these issues. On Monday, he posted dozens of messages promoting blatant conspiracy theories like QAnon, which are largely banned on mainstream platforms.

Trump’s ongoing legal troubles make the network’s financial situation even more precarious. An early investor sued DWAC alleging violations of securities law, and it’s not entirely clear who else is on the company’s board. of Sarasota Herald-Tribune It was reported in July that Trump had left his media company weeks before the SEC board members were subpoenaed. In a statement Axios In the month of July, Truth contends that Trump is still on the board, even though Florida business records indicate he left in June.

As part of its SEC filing this month, DWAC warned investors that the truth could become “less popular” if the investigations into Trump, including those looking into his businesses and his role in the deadly Jan. 6 attack on the Capitol, are damaged. Trump’s credibility.

However, Truth Social seems to be making some gains in the business arena. Last week, Rumble announced that it will launch its own advertising network that will allow advertisers to run ads on its partner platforms. Truth has joined Social Rumble as its first advertising partner.

“By partnering with Rumble Ads, Truth Social is poised to displace big tech platforms as the best platform for businesses to connect with an extraordinarily engaged audience of millions of real people,” TMTG CEO Devin Nunes said in a statement.

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