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  "docSlug": "86dfa89096f8",
  "documentTitle": "Momo, Inc. (MOMO)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Ben Axler",
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  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2018-06-27 00:00:00",
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  "pageNumber": 23,
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  "notes": "Uses a process diagram to contrast the 'official' flow with the 'actual' (alleged) flow.",
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      "kind": "callout",
      "text": "The nature of the above (right) transactions, and the fact that some of these agencies are Momo owned entities, creates uncertainty around accounting treatment and opens the door for potentially illegal activities (e.g. money laundering)",
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      "kind": "diagram",
      "text": "Three-part process diagram showing 'Accounting?' and 'Virtual Gifts Rebate 5%'",
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      "text": "Live Video Revenue Recognition flow chart",
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      "kind": "list",
      "text": "Users purchase virtual currency... Momo takes a cut... Agencies act as representation... This chain is relatively straightforward.",
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      "kind": "list",
      "text": "Though never discussed publicly... Momo is providing free virtual currency... The nature of the above transactions creates uncertainty.",
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      "kind": "paragraph",
      "text": "The chain of virtual gifting transactions and accounting discussed publicly by Momo management is rather straightforward (\"clean\"). However, this chain gets increasingly \"murky\" once you introduce Momo related party agencies, agencies supporting their own talent, free virtual currency and cash rebates.",
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      "kind": "source-note",
      "text": "Source: Spruce Point. All of the above applies to independent and Momo owned agencies",
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      "kind": "source-note",
      "text": "Source: Momo, KGI",
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      "kind": "title",
      "text": "Red Flag 3: MOMO's Undisclosed Ownership of Talent Agencies + Related Party Transactions (Cont'd)",
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      "arcName": "Overcoming the Monster",
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      "evidence": "Slides 7-69 systematically expose contradictions and red flags in Momo's business, including undisclosed charges, complex VIE structure, and regulatory risks.",
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      "objective": "What are the implications of Momo's undisclosed charges and complex VIE structure?",
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