Document_And_Entity_Informatio
Document And Entity Information | 3 Months Ended | |
Jan. 31, 2015 | Mar. 13, 2015 | |
Document Information [Line Items] | ||
Entity Registrant Name | REALBIZ MEDIA GROUP, INC | |
Entity Central Index Key | 1430523 | |
Current Fiscal Year End Date | -21 | |
Entity Filer Category | Smaller Reporting Company | |
Trading Symbol | RBIZ | |
Entity Common Stock, Shares Outstanding | 103,302,039 | |
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 31-Jan-15 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2015 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Jan. 31, 2015 | Oct. 31, 2014 |
Current Assets | ||
Cash | $141,204 | $20,066 |
Accounts receivable, net of allowance for doubtful accounts | 93,337 | 118,408 |
Prepaid expenses | 3,300 | 3,300 |
Total current assets | 237,841 | 141,774 |
Property and equipment, net | 40,363 | 45,778 |
Website development costs and intangible assets, net | 3,223,845 | 3,701,144 |
Due from affiliates | 337,093 | 131,086 |
Total assets | 3,839,142 | 4,019,782 |
Current Liabilities | ||
Accounts payable and accrued expenses | 1,853,151 | 1,880,294 |
Deferred revenue | 35,603 | 45,565 |
Derivative liabilities | 571,630 | 305,220 |
Convertible notes payable, net of discount of $-0- and $-0-, respectively | 60,000 | 60,000 |
Loans payable | 170,000 | 170,000 |
Total current liabilities | 2,690,384 | 2,461,079 |
Convertible notes payable - long term, net of discount of $819,976 and $147,395, respectively | 265,024 | 2,605 |
Total liabilities | 2,955,408 | 2,463,684 |
Stockholders' Equity | ||
Common stock, $.001 par value; 250,000,000 authorized and 88,664,744 shares issued and outstanding at January 31,2015 and 84,980,282 shares issued and outstanding at October 31, 2014, respectively | 88,664 | 84,980 |
Additional paid-in-capital | 17,721,847 | 16,610,912 |
Subscription advances | 0 | 130,000 |
Accumulated other comprehensive income | 48,105 | 40,042 |
Accumulated deficit | -17,041,710 | -15,376,638 |
Total stockholders' equity | 883,734 | 1,556,098 |
Total liabilities and stockholders' equity | 3,839,142 | 4,019,782 |
Series A Preferred Stock [Member] | ||
Stockholders' Equity | ||
Preferred Stock Value | 66,802 | 66,802 |
Series B Preferred Stock [Member] | ||
Stockholders' Equity | ||
Preferred Stock Value | $26 | $0 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Jan. 31, 2015 | Oct. 31, 2014 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares, issued | 88,664,744 | 84,980,282 |
Common stock, shares outstanding | 88,664,744 | 84,980,282 |
Discount on Convertible notes payable, current (in dollars) | $0 | $0 |
Discount on Convertible notes payable, Non current (in dollars) | $819,976 | $147,395 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 120,000,000 | 120,000,000 |
Preferred Stock, shares issued | 66,801,653 | 66,801,653 |
Preferred stock, shares outstanding | 66,801,653 | 66,801,653 |
Series B Preferred Stock [Member] | ||
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred Stock, shares issued | 26,000 | 0 |
Preferred stock, shares outstanding | 26,000 | 0 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Income (Loss) (USD $) | 3 Months Ended | |
Jan. 31, 2015 | Jan. 31, 2014 | |
Revenues | ||
Real estate media revenue | $292,656 | $246,054 |
Operating expenses | ||
Cost of revenue (exclusive of amortization) | 12,634 | 21,990 |
Technology and development | 292,623 | 0 |
Salaries and benefits | 331,717 | 252,913 |
Selling and promotions expense | 39,095 | 88,044 |
General and administrative | 1,007,960 | 1,341,727 |
Total operating expenses | 1,684,029 | 1,704,674 |
Operating loss | -1,391,373 | -1,458,620 |
Other income (expense) | ||
Interest expense | -49,385 | -870 |
Loss on change on fair value of derivatives | -266,410 | 0 |
Gain on legal settlement of accounts payable | 32,483 | 0 |
Foreign exchange gain | 9,613 | 7,512 |
Total other income (expense) | -273,699 | 6,642 |
Net loss | -1,665,072 | -1,451,978 |
Preferred Stock Dividend | 0 | -118,496 |
Net loss attributable to common stockholders | -1,665,072 | -1,570,474 |
Weighted average number of shares outstanding (in shares) | 87,598,484 | 54,473,194 |
Basic and diluted net loss per share (in dollars per share) | ($0.02) | ($0.03) |
Comprehensive income (loss): | ||
Unrealized gain (loss) on currency translation adjustment | 8,063 | 205,529 |
Comprehensive loss | ($1,657,009) | ($1,364,945) |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
Jan. 31, 2015 | Jan. 31, 2014 | |
Cash flows from operating activities: | ||
Net loss | ($1,665,072) | ($1,451,978) |
Adjustments to reconcile net loss to net cash from operating activities: | ||
Gain on legal settlement of accounts payable | -32,483 | 0 |
Amortization and depreciation | 547,723 | 346,098 |
Loss on change in fair value of derivative liabilities | 266,410 | 0 |
Stock based compensation and consulting fees | 173,865 | 649,404 |
Changes in operating assets and liabilities: | ||
Decrease in accounts receivable | 25,071 | 10,656 |
Decrease in prepaid expenses | 0 | 145 |
Decrease in security deposits | 0 | 22 |
Increase (decrease) in accounts payable and accrued expenses | 5,340 | -57,991 |
Decrease in due to/from affiliates | -176,007 | -891,199 |
Decrease in deferred revenue | -9,962 | -467 |
Net cash used in operating activities | -865,115 | -1,395,310 |
Cash flows from investing activities: | ||
Purchase of computer equipment | 0 | -2,058 |
Payments towards software developments costs | -31,810 | 0 |
Payments towards website development costs | 0 | -177,401 |
Net cash used in investing activities | -31,810 | -179,459 |
Cash flows from financing activities: | ||
Proceeds from convertible promissory notes | 935,000 | 0 |
Payments applied to loans payable | 0 | -8,807 |
Proceeds from the sale of common stock and warrants | 75,000 | 80,000 |
Proceeds from the exercise of outstanding warrants | 0 | 160,000 |
Net cash provided by financing activities | 1,010,000 | 231,193 |
Effect of exchange rate changes on cash | 8,063 | 205,529 |
Net increase (decrease) in cash | 121,138 | -1,138,047 |
Cash at beginning of period | 20,066 | 1,304,374 |
Cash at end of period | 141,204 | 166,327 |
Supplemental disclosure: | ||
Cash paid for interest | 0 | 870 |
Common Stock [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Conversion of Stock, Amount Issued | 30,000 | 13,500 |
Value of Next 1, Interactive debt settled | 30,000 | |
Conversion of Stock, Shares Issued | 100,000 | 27,000 |
Warrant [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Conversion of Stock, Shares Issued | 100,000 | 9,000 |
Preferred Series B shares converted to common stock [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Conversion of Stock, Amount Issued | 45,000 | 349,750 |
Conversion of Stock, Shares Issued | 900,000 | 7,895,000 |
Preferred Series C shares converted to common stock [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Conversion of Stock, Amount Issued | 77,000 | 0 |
Conversion of Stock, Shares Issued | 770,000 | 0 |
Preferred Series D shares converted to common stock [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Conversion of Stock, Amount Issued | 82,500 | 122,625 |
Conversion of Stock, Shares Issued | 549,945 | 817,418 |
Series B Convertible Prefer Stock [Member] | ||
Supplemental disclosure of non-cash investing and financing activity: | ||
Conversion of Stock, Amount Issued | 100,000 | 0 |
Value of Next 1, Interactive debt settled | $30,000 | $0 |
Conversion of Stock, Shares Issued | 13,000 | 0 |
NATURE_OF_BUSINESS_AND_BASIS_O
NATURE OF BUSINESS AND BASIS OF PRESENTATION | 3 Months Ended |
Jan. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | NOTE 1: NATURE OF BUSINESS AND BASIS OF PRESENTATION |
Nature of Business | |
RealBiz Media Group, Inc. ("RealBiz") is engaged in the business of providing digital media and marketing services for the real estate industry. RealBiz currently generates revenue from advertising revenues and through real estate agent and broker service fees, membership fees and product sales. | |
Basis of Presentation | |
The unaudited interim consolidated financial information furnished herein reflects all adjustments, consisting only of normal recurring items, which in the opinion of management are necessary to fairly state RealBiz Media Group, Inc. and its subsidiaries’ (collectively, the “Company” or “we,” “us” or “our”) financial position, results of operations and cash flows for the dates and periods presented and to make such information not misleading. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to rules and regulations of the Securities and Exchange Commission (“SEC”); nevertheless, management of the Company believes that the disclosures herein are adequate to make the information presented not misleading. | |
These unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements for the year ended October 31, 2014, contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 13, 2015. The results of operations for the three months ended January 31, 2015, are not necessarily indicative of results to be expected for any other interim period or the fiscal year ending October 31, 2015. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended | |||
Jan. 31, 2015 | ||||
Accounting Policies [Abstract] | ||||
Business Description and Accounting Policies [Text Block] | NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Use of Estimates | ||||
The preparation of unaudited consolidated financial statements in conformity with accounting principles generally accepted in the United States of America 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 date of the unaudited consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. If actual results significantly differ from the Company’s estimates, the Company’s financial condition and results of operations could be materially impacted. | ||||
Cash and Cash Equivalents | ||||
For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents at January 31, 2015 and October 31, 2014. | ||||
Accounts Receivable | ||||
The Company provides its marketing and promotional services to agents or brokers via a web-based portal that allows for credit card payments. The Company recognizes accounts receivable for amounts uncollected from the credit card service provider at the end of the accounting period. The Company regularly reviews outstanding receivables and provides for estimated losses through an allowance for doubtful accounts. In evaluating the level of established loss reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events and other factors. As the financial condition of these parties change, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. The Company maintains reserves for potential credit losses, and such losses traditionally have been within its expectations. The allowance for doubtful accounts at January 31, 2015 and October 31, 2014, respectively is $-0-. | ||||
Property and Equipment | ||||
All expenditures on the acquisition for property and equipment are recorded at cost and capitalized as incurred, provided the asset benefits the Company for a period of more than one year. Expenditures on routine repairs and maintenance of property and equipment are charged directly to operating expense. The property and equipment is depreciated based upon its estimated useful life after being placed in service. The estimated useful life of computer equipment is 3 years. When equipment is retired, sold or impaired, the resulting gain or loss is reflected in earnings. The Company incurred depreciation expense of $5,415 and $1,761 for the three months ended January 31, 2015 and 2014, respectively. | ||||
Impairment of Long-Lived Assets | ||||
In accordance with Accounting Standards Codification 360-10, “Property, Plant and Equipment”, the Company periodically reviews its long- lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. As of January 31, 2015, the Company did not impair any long-lived assets. | ||||
Website Development Costs | ||||
The Company accounts for website development costs in accordance with Accounting Standards Codification 350-50 “Website Development Costs”. Accordingly, all costs incurred in the planning stage are expensed as incurred, costs incurred in the website application and infrastructure development stage that meet specific criteria are capitalized and costs incurred in the day to day operation of the website are expensed as incurred. | ||||
Software Development Costs | ||||
The Company capitalizes internal software development costs subsequent to establishing technological feasibility of a software application in accordance with guidelines established by "350-40" Internal Use Software, requiring certain software development costs to be capitalized upon the establishment of technological feasibility. The establishment of technological feasibility and the ongoing assessment of the recoverability of these costs require considerable judgment by management with respect to certain external factors such as anticipated future revenue, estimated economic life, and changes in software and hardware technologies. Amortization of the capitalized software development costs begins when the product is available for general release to customers. Capitalized costs are amortized based on the greater of (a) the ratio of current gross revenues to the total current and anticipated future gross revenues, or (b) the straight-line method over the remaining estimated economic life of the product and is included in operating expenses in the accompanying statement of operations. For the three months ended January 31, 2015, the Company has capitalized $31,810 of costs associated with the development of a mobile app that has been placed into service on February 4, 2015 and will begin amortization of all capitalized costs in the second quarter of the current fiscal year. | ||||
Goodwill and Other Intangible Assets | ||||
In accordance with ASC 350-30-65 “Goodwill and Other Intangible Assets", the Company assesses the impairment of identifiable intangible assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following: | ||||
1 | Significant underperformance compared to historical or projected future operating results; | |||
2 | Significant changes in the manner or use of the acquired assets or the strategy for the overall business; and | |||
3 | Significant negative industry or economic trends. | |||
When the Company determines that the carrying value of an intangible may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flow, the Company records an impairment charge equal to the amount that the book value exceeds fair value. The Company measures fair value based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent to the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. The Company did not consider it necessary to record an impairment charge on its intangible assets during the three months ended January 31, 2015 and 2014. | ||||
Intellectual properties that have finite useful lives are amortized over their useful lives. The Company incurred amortization expense related to website development costs and other intangible assets of $509,109 and $344,337 for the three months ended January 31, 2015 and 2014, respectively. This amortization is included in technology and development expenses and general and administrative expenses in the accompanying statement of operations. | ||||
Derivative Instruments | ||||
The Company enters into financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with Accounting Standards Codification topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretations of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, considering all of the rights and obligations of each instrument. | ||||
The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered consistent with the objective measuring fair values. In selecting the appropriate technique, the Company considers, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. For less complex derivative instruments, such as freestanding warrants, the Company generally uses the Black-Scholes model, adjusted for the effect of dilution, because it embodies all of the requisite assumptions (including trading volatility, estimated terms, dilution and risk free rates) necessary to fair value these instruments. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of our common stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimates and assumption changes. Under the terms of the new accounting standard, increases in the trading price of the Company’s common stock and increases in fair value during a given financial quarter result in the application of non-cash derivative expense. Conversely, decreases in the trading price of the Company’s common stock and decreases in trading fair value during a given financial quarter result in the application of non-cash derivative income. | ||||
Based upon ASC 815-25 the Company has adopted a sequencing approach regarding the application of ASC 815-40 to its outstanding convertible debentures. Pursuant to the sequencing approach, the Company evaluates its contracts based upon earliest issuance date. | ||||
Convertible Debt Instruments | ||||
The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the FASB Accounting Standards Codification. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt. | ||||
Fair Value of Financial Instruments | ||||
The Company adopted ASC topic 820, “Fair Value Measurements and Disclosures” (ASC 820), formerly SFAS No. 157 “Fair Value Measurements,” effective January 1, 2009. ASC 820 defines “fair value” as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There was no impact relating to the adoption of ASC 820 to the Company’s unaudited consolidated financial statements. | ||||
ASC 820 also describes three levels of inputs that may be used to measure fair value: | ||||
Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets. | ||||
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. | ||||
Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. | ||||
Financial instruments consist principally of cash, accounts receivable, prepaid expenses, due from affiliates, accounts payable, accrued liabilities and other current liabilities. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short- term nature. The fair value of long-term debt is based on current rates at which the Company could borrow funds with similar remaining maturities. The carrying amounts approximate fair value. It is management’s opinion that the Company is not exposed to any significant currency or credit risks arising from these financial instruments. | ||||
Revenue Recognition | ||||
The Company recognizes revenue when all of the following criteria are met: (1) persuasive evidence of an arrangement exits; (2) delivery has occurred or services have been rendered; (3) the Company's price to its customer is fixed or determinable and (4) collectability is reasonably assured. | ||||
The Company provides its marketing and promotional services to agents or brokers via a web-based portal that allows for credit card payments. Customers may pay a monthly recurring fee or an annual fee. Some customers additionally pay a one-time set up fee. Monthly recurring fees are recognized in the month the service is rendered. Collection of one-time set up fees and annual services fees give rise to recognized monthly revenue in the then-current month as well as deferred revenue liabilities representing the collected fee for services yet to be delivered. | ||||
Cost of Revenues | ||||
Cost of revenues includes costs attributable to services sold and delivered. These costs include such items as credit card fees, sales commission to business partners, expenses related to our participation in industry conferences, and public relations expenses. | ||||
Technology and Development | ||||
Costs to research and develop our products are expensed as incurred. These costs consist of primarily of technology and development related expenses including third party contractor fees and technology software services. Technology and development also includes amortization of capitalized costs of the Nestbuilder website associated with the development of our marketplace. The amortization of the Nestbuilder website for the three months ending January 31, 2015 and 2014 is $127,272 and $-0-, respectively. | ||||
Advertising Expense | ||||
Advertising costs are charged to expense as incurred and are included in selling and promotions expense in the accompanying unaudited unaudited consolidated financial statements. Advertising expense for the three months ended January 31, 2015 and 2014 was $-0- and $25,880, respectively. | ||||
Share-Based Compensation | ||||
The Company computes share based payments in accordance with Accounting Standards Codification 718-10 “Compensation” (ASC 718-10). ASC 718-10 establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods and services at fair value, focusing primarily on accounting for transactions in which an entity obtains employees services in share-based payment transactions. It also addresses transactions in which an entity incurs liabilities in exchange for goods and services that are based on the fair value of an entity’s equity instruments or that may be settled by the issuance of those equity instruments. In March 2005, the SEC issued SAB No. 107, Share-Based Payment (“SAB 107”) which provides guidance regarding the interaction of ASC 718-10 and certain SEC rules and regulations. The Company has applied the provisions of SAB 107 in its adoption of ASC 718-10. The Company accounts for non-employee share-based awards in accordance with ASC Topic 505-50, Equity Based Payments to Non-Employees. The Company estimates the fair value of stock options by using the Black-Scholes option pricing model. | ||||
Foreign Currency and Other Comprehensive Income (Loss) | ||||
The functional currency of our foreign subsidiaries is typically the applicable local currency. The translation from the respective foreign currencies to United States Dollars (U.S. Dollar) is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for income statement accounts using a weighted average exchange rate during the period. Gains or losses resulting from such translation are included as a separate component of accumulated other comprehensive income. Gains or losses resulting from foreign currency transactions are included in foreign currency income or loss except for the effect of exchange rates on long-term inter-company transactions considered to be a long-term investment, which are accumulated and credited or charged to other comprehensive income. | ||||
Transaction gains and losses are recognized in our results of operations based on the difference between the foreign exchange rates on the transaction date and on the reporting date. We recognized net foreign exchange gain of $9,613 and $7,512 for three months ended January 31, 2015 and 2014, respectively. The foreign currency exchange gains and losses are included as a component of other (income) expense, net, in the accompanying Unaudited Consolidated Statements of Operations. For the three months ended January 31, 2015 and 2014, the accumulated comprehensive gain was $8,063 and $205,529, respectively | ||||
The exchange rate adopted for the foreign exchange transactions are the rates of exchange as quoted on an internet website. Translation of amount from Canadian dollars into United States dollars was made at the following exchange rates for the respective periods: | ||||
⋅ | As of January 31, 2015 - Canadian dollar $0.78970 to US $1.00 | |||
⋅ | For the three months ended January 31, 2015 - Canadian dollar $0.87365 to US $1.00 | |||
Income Taxes | ||||
The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes. Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities and net operating loss and tax credit carryforwards given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which the Company operates, estimates of future taxable income, and available tax planning strategies. If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria of ASC 740. | ||||
ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the unaudited consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. | ||||
Earnings Per Share | ||||
Basic earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. | ||||
Diluted earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. Diluted loss per common share is considered to be equal to basic because it is anti-dilutive. The Company’s common stock equivalents include the following: | ||||
January 31, | ||||
2015 | ||||
Series A convertible preferred stock issued and outstanding | 66,801,653 | |||
Series B convertible preferred stock issued and outstanding | 520,000 | |||
Warrants to purchase common stock issued, outstanding and exercisable | 17,017,730 | |||
Shares on convertible promissory notes | 11,458,119 | |||
95,797,502 | ||||
Concentrations, Risks and Uncertainties | ||||
The Company’s operations are related to the real estate industry and its prospects for success are tied indirectly to interest rates and the general housing and business climates in the United States. | ||||
Reclassifications | ||||
Certain reclassifications have been made in the unaudited consolidated financial statements for comparative purposes. These reclassifications have no effect on the results of operations or financial position of the Company. | ||||
Recently Issued Accounting Pronouncements | ||||
In May 2014, the FASB issued an accounting standard update on revenue recognition that will be applied to all contracts with customers. The update requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. It also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. This guidance will be required to be applied on a retrospective basis, using one of two methodologies, and will be effective for annual reporting periods beginning after December 15, 2016, with early application not being permitted. The Company is currently evaluating the impact that this guidance will have on its financial position and results of operations. | ||||
In August 2014, the FASB issued an accounting standard update which provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. The update requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year of the date the financial statements are issued. It also requires management to provide certain disclosures if conditions or events raise substantial doubt about the entity's ability to continue as a going concern. This guidance will be required for annual reporting periods ending after December 15, 2016, and interim reporting periods thereafter, with early application permitted. The Company is currently evaluating the impact that this guidance will have on its financial position and results of operations. | ||||
GOING_CONCERN
GOING CONCERN | 3 Months Ended |
Jan. 31, 2015 | |
Going Concern [Abstract] | |
Going Concern Disclosure [Text Block] | NOTE 3: GOING CONCERN |
The accompanying unaudited consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. | |
The Company has incurred net losses of $1,665,072 for the three months ended January 31, 2015. At January 31, 2015, the Company had a working capital deficit of $2,452,543 and an accumulated deficit of $17,041,710. It is management’s opinion that these facts raise substantial doubt about the Company’s ability to continue as a going concern without additional debt or equity financing. The unaudited consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts nor to the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. | |
In order to meet its working capital needs through the next twelve months, the Company may consider plans to raise additional funds through the issuance of additional shares of common or preferred stock and or through the issuance of debt instruments. Although the Company intends to obtain additional financing to meet our cash needs, the Company may be unable to secure any additional financing on terms that are favorable or acceptable to it, if at all. | |
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended | ||||||||||||
Jan. 31, 2015 | |||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||
Property, Plant and Equipment Disclosure [Text Block] | Note 4: Property and Equipment | ||||||||||||
At January 31, 2015, the Company's property and equipment are as follows: | |||||||||||||
January 31, 2015 | |||||||||||||
Remaining | Accumulated | Net Carrying | |||||||||||
Useful Life | Cost | Depreciation | Value | ||||||||||
Computer equipment - office | 1.5 Years | $ | 22,881 | $ | 11,797 | $ | 11,084 | ||||||
Computer equipment - Nestbuilder website | 2.1 Years | 42,149 | 12,870 | 29,279 | |||||||||
$ | 65,030 | $ | 24,667 | $ | 40,363 | ||||||||
The Company has recorded $5,415 and $1,761 of depreciation expense for the three months ended January 31, 2015 and 2014, respectively. There was no property and equipment impairment recorded for the three months ended January 31, 2015 and 2014. | |||||||||||||
INTANGIBLE_ASSETS_AND_BUSINESS
INTANGIBLE ASSETS AND BUSINESS COMBINATION | 3 Months Ended | ||||||||||||
Jan. 31, 2015 | |||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||
Intangible Assets Disclosure [Text Block] | NOTE 5: INTANGIBLE ASSETS AND BUSINESS COMBINATION | ||||||||||||
The following table sets forth the intangible assets, both acquired and developed, including accumulated amortization: | |||||||||||||
January 31, 2015 | |||||||||||||
Remaining | Accumulated | Net Carrying | |||||||||||
Useful Life | Cost | Amortization | Value | ||||||||||
Sales/Marketing agreement | 1.2 Years | $ | 4,796,178 | $ | 3,099,033 | $ | 1,697,145 | ||||||
Website development costs | 2.2 Years | 1,527,307 | 422,111 | 1,105,196 | |||||||||
Web platform/customer relationships - ReachFactor acquisition | 2.3 Years | 600,000 | 262,496 | 337,504 | |||||||||
Software development costs (not placed in service) | 3.0 Years | 84,000 | -0- | 84,000 | |||||||||
$ | 7,007,485 | $ | 3,783,640 | $ | 3,223,845 | ||||||||
During the three months January 31, 2015, the Company incurred expenditures of $31,810 for software development costs to develop a mobile app called "EZ FLIX" as a tool to assist users in converting still pictures to video. The Company capitalized internal software development costs subsequent to establishing technological feasibility of a software application in accordance with guidelines established by "350-40" Internal Use Software, requiring certain software development costs to be capitalized upon the establishment of technological feasibility. The establishment of technological feasibility and the ongoing assessment of the recoverability of these costs require considerable judgment by management with respect to certain external factors such as anticipated future revenue, estimated economic life, and changes in software and hardware technologies. Amortization of the capitalized software development costs begins when the product is available for general release to customers anticipated to be available on February 4, 2015. Capitalized costs are amortized based on the greater of (a) the ratio of current gross revenues to the total current and anticipated future gross revenues, or (b) the straight-line method over the remaining estimated economic life of the product. The app was placed in service on February 4, 2015 and amortization will begin in the second quarter of the current fiscal year. | |||||||||||||
Intangible assets are amortized on a straight-line basis over their expected useful lives, estimated to be 4 years, except for the website(s), which is 3 years. Amortization expense related to website development costs and intangible assets was $509,109 and $344,377 for three months ended January 31, 2015 and 2014, respectively. | |||||||||||||
ACCOUNTS_PAYABLE_AND_ACCRUED_E
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 3 Months Ended | ||||
Jan. 31, 2015 | |||||
Payables and Accruals [Abstract] | |||||
Accounts Payable and Accrued Liabilities Disclosure [Text Block] | NOTE 6: ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ||||
At January 31, 2015, the Company’s accounts payable and accrued expenses are as follows: | |||||
January 31, | |||||
2015 | |||||
Trade payables and accruals | $ | 218,240 | |||
Accrued preferred stock dividends | 915,447 | ||||
Accrued payroll and commissions | 500,875 | ||||
Other liabilities | 218,589 | ||||
Total accounts payable and accrued expenses | $ | 1,853,151 | |||
DUE_FROMTO_AFFILIATES
DUE FROM/TO AFFILIATES | 3 Months Ended |
Jan. 31, 2015 | |
Receivables [Abstract] | |
Due to and from Broker-Dealers and Clearing Organizations Disclosure [Text Block] | NOTE 7: DUE FROM/TO AFFILIATES |
During the normal course of business, the Company receives and/or makes advances for operating expenses to/from its parent Company, Next 1 Interactive, Inc. As of January 31, 2015, the Company is due $337,093 as a result of such transactions. | |
CONVERTIBLE_NOTES_PAYABLE
CONVERTIBLE NOTES PAYABLE | 3 Months Ended | ||
Jan. 31, 2015 | |||
Debt Disclosure [Abstract] | |||
Convertible Notes Payable [Text Block] | NOTE 8: CONVERTIBLE NOTES PAYABLE | ||
During the three months ended January 31, 2015, the Company: | |||
· | During December 2014 and January 2015, the Company received $935,000 in proceeds and issued two (2) year, 12% convertible promissory notes maturing on December 31, 2016 to various non-related third party investors. Interest shall accrue on the principal of the note at a rate equal to 12.0% per annum in cash and 12.0% in stock per annum based upon $0.10 (ten) cents per share. The noteholder, at their option, shall have the right, but not the obligation, at any time and from time to time, to convert all or any portion of the principal and interest into fully paid and non-assessable shares of Company common stock at the conversion price of $0.10 per share. | ||
The Company evaluated the conversion feature of the promissory notes and determined the Company's common stock exceeded the conversion price as stated in each of the convertible promissory notes. Management determined that the favorable exercise price represented a beneficial conversion feature. Using the intrinsic value method at the convertible promissory note date, a total discount of $705,780 was recognized. The discount is being amortized over the terms of the convertible promissory notes using the straight-line method, which approximated the effective interest method. During the three months ending January 31, 2015, $14,399 of the debt discount has been amortized and recorded as interest expense. Stated interest charged to operations relating to this note for the three months ended January 31, 2015 and 2014 amounted to $11,955 and $-0-, respectively. As of January 31, 2015, the remaining principal balance is $935,000 and the remaining un-amortized discount balance was $691,441. | |||
· | On October 20, 2014, the Company issued a two (2) year, 7.5% convertible promissory note maturing on October 19, 2016 with a non-related third party investor valued at $150,000 and received $95,000 in cash proceeds net of $55,000 in loan origination fees included in the calculation of the debt discount. As an incentive, the Company issued 300,000 warrants to the holder with a two-year life and a fair value of approximately $14,760 to purchase shares of the Company’s common stock, $0.001 par value, per share, at an exercise price of $0.17 per share included as part of the debt discount. The fair value of the warrants was estimated at the date of grant using the Black-Scholes option-pricing model with the following assumptions: risk-free interest rate between 0.94% and 1.51%, dividend yield of -0-%, volatility factor between 115.05% and 124.65% and an expected life of 1.5 years. The value of these warrants was charged to interest expense with the offset to additional paid-in-capital. The noteholder, at their option, has the right from time to time, and at any time on or prior to the later of (i) the Maturity Date and (ii) the date of payment of the Default Amount, each in respect of the remaining outstanding principal amount of this Note to convert all or any part of the outstanding and unpaid principal amount of this Note into fully paid and non-assessable shares of Common Stock at the Conversion Price. The conversion price means the lower of the fixed conversion price of $0.20 or the variable conversion price. The variable conversion price shall mean 65% multiplied by the lowest of the VWAP (volume weighted average price) of the common stock during the twelve (12) consecutive trading day period ending on and including the trading day immediately preceding the conversion date. | ||
Additionally, the Company accounted for the embedded conversion option liability in accordance with Accounting Standards Codification topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretation of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determined the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, giving consideration to all of the rights and obligations of each instrument. The fair value of embedded conversion option liability at January 31, 2015 was valued using the Black-Scholes model, resulting in a fair value of $571,630, previously valued at $305,220 resulting in a loss in the change in the fair value of derivatives totaling $266,410. The assumptions used in the Black-Scholes pricing model at January 31, 2015 are as follows: (1) dividend yield of 0%; (2) expected volatility of 359.42%, (3) risk-free interest rate of 0.47%, and (4) expected life of 1.70 years. During the three months ending January 31, 2015, $18,260 of the debt discount has been amortized and recorded as interest expense. Stated interest charged to operations relating to this note for the three months ended January 31, 2015 and 2014 amounted to $4,233 and $-0-, respectively. As of January 31, 2015, the remaining principal balance is $150,000 and the remaining un-amortized discount balance was $128,535. | |||
LOANS_PAYABLE
LOANS PAYABLE | 3 Months Ended |
Jan. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | NOTE 9: LOANS PAYABLE |
There was no activity for the three months ended January 31, 2015 for the non-related third party investors and the remaining principal balance is $170,000. | |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended | ||
Jan. 31, 2015 | |||
Stockholders' Equity Note [Abstract] | |||
Stockholders' Equity Note Disclosure [Text Block] | NOTE 10: STOCKHOLDERS’ EQUITY | ||
On July 31, 2014, the Board and the holders of a majority of the voting power of our shareholders approved an amendment to our articles of incorporation to increase our authorized shares of common stock to 250,000,000 from 125,000,000 and increased the Company's Series A Convertible Preferred Stock to 120,000,000 from 100,000,000. Additionally, on July 31, 2014, the Board designated the terms of Series B Convertible Preferred Stock and 1,000,000 shares were designated Series B Convertible Preferred stock. | |||
The total number of shares of all classes of stock that the Company shall have the authority to issue is 375,000,000 shares consisting of: 250,000,000 shares of common stock with a $0.001 par value per shares; and 120,000,000 shares which may be designated as Series A Convertible Preferred stock with a $0.001 par value per share and 1,000,000 shares designated as Series B Preferred stock with at $0.001 par value per share. | |||
Common Stock | |||
During the three months ended January 31, 2015, the Company: | |||
· | issued 816,667 shares of its common stock along with 750,000 one year warrants with an exercise of $0.18 for cash proceeds of $75,000. | ||
· | issued 1,271,350 shares of its common stock for a total value of $170,685 for consulting fees rendered. The value of the common stock issued was based on the fair value of the stock at the time of issuance. | ||
· | issued 26,500 shares of its common stock valued at $3,180 to its employees as stock compensation. The value of the common stock issued was based on the fair value of the stock at the time of issuance. | ||
· | issued 900,000 shares of its common stock valued at $45,000 upon the conversion of the holders of Next 1 dual convertible Series B preferred shares held in its parent company Next 1 Interactive, Inc. These common shares were valued at the carrying value of the converted parent company Series B preferred shares. | ||
· | issued 770,000 shares of its common stock valued at $77,000 upon the conversion of the holders of Next 1 dual convertible Series C preferred shares held in its parent company Next 1 Interactive, Inc. These common shares were valued at the carrying value of the converted parent company Series C preferred shares. | ||
· | issued 549,945 shares of its common stock valued at $82,500 upon the conversion of the holders of Next 1 dual convertible Series D preferred shares held in its parent company Next 1 Interactive, Inc. These common shares were valued at the carrying value of the converted parent company Series D preferred shares. | ||
· | issued 100,000 shares of its common stock along with 100,000 one year warrants with an exercise price of $0.50 as settlement of prior year cash advances to purchase shares by third party investors valued at $30,000. | ||
· | evaluated the conversion feature of the convertible promissory notes and determined the Company's common stock exceeded the conversion price as stated in each of the convertible promissory notes representing a beneficial conversion feature. Using the intrinsic value method at the convertible promissory note date, a total discount of $705,780 was recognized as part of additional paid in capital. | ||
· | received 750,000 shares of its common stock originally held in escrow for Suresh Srinivasan, former Chief Operating Officer. These shares were retired at par valued at $750. | ||
Common Stock Warrants | |||
At January 31, 2015, there were 17,017,730 warrants outstanding with a weighted average exercise price of $0.40 and weighted average life of .21 years. During the three months ended January 31, 2015, the Company granted 2,350,000 warrants and 711,128 expired. | |||
Convertible Preferred Stock Series A | |||
On October 14, 2014, the Company filed a certificate of amendment pursuant to the July 31st, 2014 Board of Directors approval to increase the Preferred A shares from 100,000,000 shares to 120,000,000 shares. As of January 31, 2015, the Company had 66,801,653 shares of Convertible Preferred Stock Series A issued and outstanding. The preferred shares were issued at $.001 par and bear dividends at a rate of 10% per annum payable on a quarterly basis when declared by the board of directors. Dividends accrue whether or not they have been declared by the board. At the election of the Company, Preferred Dividends may be converted into Series A Stock, with each converted share having a value equal to the market price per share, subject to adjustment for stock splits. In order to exercise such option, the Company delivers written notice to the holder. Each share of Series A Stock is convertible at the option of the holder thereof at any time into a number of shares of Common Stock determined by dividing the Stated Value of a $1 per share by the Conversion Price then in effect. The conversion price for the Series A Stock is equal to $1.00 per share. Each holder of Series A stock shall be entitled to one vote for each whole share of common stock that would be issuable upon conversion of such share on the record date for determining eligibility to participate in the action being taken. | |||
In the event of (a) the sale, conveyance, exchange, exclusive license, lease or other disposition of all or substantially all of the intellectual property or assets of the Company, (b) any acquisition of the Company by means of consolidation, stock exchange, stock sale, merger of other form of corporate reorganization of the Company with any other entity in which the Company's stockholders prior to the consolidation or merger own less than a majority of the voting securities of the surviving entity, or (c) the winding up or dissolution of the Company, whether voluntary or involuntary (each such event in clause (a), (b) or (c) a "liquidation event"), the Board shall determine in good faith the amount legally available for distribution to stockholders after taking into account the distribution of assets among, or payment thereof over to, creditors of the Company (the "net assets available for distribution"). The holders of the Series A stock then outstanding shall be entitled to be paid out of the net assets available for Distribution (or the consideration received in such transaction) before any payment or distribution shall be made to the holders of any class of preferred stock ranking junior to the Series A Stock or to the Common Stock, an amount for each share of Series A Stock equal to all accrued and unpaid Preferred Dividends plus the Stated Value, as adjusted (the "Series A Liquidation Amount"). | |||
Accrued and declared preferred stock dividends on the outstanding preferred shares as of January 31, 2015 totaled $915,447 and are included in accounts payable and accrued expenses in the accompanying balance sheet. These preferred stock dividends were declared on December 28, 2014, to holders of record on August 31, 2014. Additional preferred stock dividends accruing, but have not been declared, on the outstanding preferred shares as of January 31, 2015 were $158,209. | |||
During the three months ended January 31, 2015, the Company recorded no activity. | |||
Convertible Preferred Stock Series B | |||
On July 31, 2014, the Company's Board of Directors approved the creation of a new Series B Preferred stock and on October 14, 2014 a certificate of designation was filed with the state of Delaware designating 1,000,000 shares with a par value of $0.001, a stated value of $5.00 per share and convertible into the Company's common stock at $0.05 per share. As of January 31, 2015, the Company had 26,000 shares of Convertible Preferred Stock Series B issued and outstanding. The Series B Preferred stock will bear dividends at a rate of 10% per annum and shall accrue on the stated value of such shares of the Series B Stock. Dividends accrue whether or not they have been declared by the Board of Directors. At the election of the Company, it may satisfy its obligations hereunder to pay dividends on the Series B stock by issuing shares of common stock to the holders of Series B stock on a uniform and prorated basis. Each share of Series B Stock is convertible at the option of the holder thereof at any time into a number of shares of Common Stock determined by dividing the Stated Value by the Conversion Price then in effect. The conversion price for the Series B Stock is equal to $0.05 per share. Each holder of Series B stock shall be entitled to the number of votes equal to two hundred (200) votes for each shares of Series B stock held by them. | |||
In the event of (a) the sale, conveyance, exchange, exclusive license, lease or other disposition of all or substantially all of the intellectual property or assets of the Company, (b) any acquisition of the Company by means of consolidation, stock exchange, stock sale, merger of other form of corporate reorganization of the Company with any other entity in which the Company's stockholders prior to the consolidation or merger own less than a majority of the voting securities of the surviving entity, or (c) the winding up or dissolution of the Company, whether voluntary or involuntary (each such event in clause (a), (b) or (c) a "liquidation event"), the Board shall determine in good faith the amount legally available for distribution to stockholders after taking into account the distribution of assets among, or payment thereof over to, creditors of the Company (the "net assets available for distribution"). The holders of the Series B stock then outstanding shall be entitled to be paid out of the net assets available for Distribution (or the consideration received in such transaction) before any payment or distribution shall be made to the holders of any class of preferred stock ranking junior to the Series B Stock or to the Common Stock, an amount for each share of Series B Stock equal to all accrued and unpaid Preferred Dividends plus the Stated Value, as adjusted (the "Series B Liquidation Amount"). Preferred stock dividends accruing, but have not been declared, on the outstanding preferred shares as of January 31, 2015 were $5,540. | |||
During the three months ended January 31, 2015, the Company: | |||
· | issued 26,000 shares of its Series B Preferred stock along with 1,250,000 five (5) year Next 1 Interactive, Inc. common stock warrants with exercise prices between $0.01 to $0.05 valued at $130,000, based on subscription agreements. $100,000 was in settlement of prior year cash advances to purchase shares by third party investors and the balance of $30,000 was applied to Next 1 Interactive, Inc debt obligation. | ||
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Jan. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 11: RELATED PARTY TRANSACTIONS |
During the three months ended January 31, 2015, the Company paid $800 a month in rent for office space on behalf of an officer of the Company, for Company use. | |
Equity transactions with the Company's parent are described in Note 10. | |
FAIR_VALUE_MEASUREMENT_AND_DIS
FAIR VALUE MEASUREMENT AND DISCLOSURE | 3 Months Ended | |||||||||||||
Jan. 31, 2015 | ||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||
Fair Value Disclosures [Text Block] | NOTE 12: FAIR VALUE MEASUREMENT AND DISCLOSURE | |||||||||||||
The Company has adopted ASC 820, Fair Market Measurement and Disclosures including the application of the statement to non-recurring, non-financial assets and liabilities. The adoption of ASC 820 did not have a material impact on the Company’s fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. ASC 820 establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows: | ||||||||||||||
Level 1 - Quoted prices in active markets for identical assets or liabilities. | ||||||||||||||
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||||
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | ||||||||||||||
Fair Value Measurements at January 31, 2015 is summarized below: | ||||||||||||||
Quoted Prices in | ||||||||||||||
Active Markets | ||||||||||||||
for Identical | Significant Other | Significant | ||||||||||||
Assets | Observable Inputs | Unobservable Inputs | ||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Cash | $ | 141,204 | $ | - | $ | - | $ | 141,204 | ||||||
Derivative liabilities | - | - | 517,630 | 571,630 | ||||||||||
31-Jan-15 | $ | 141,204 | $ | - | $ | 517,630 | $ | 712,834 | ||||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 3 Months Ended | ||
Jan. 31, 2015 | |||
Subsequent Events [Abstract] | |||
Subsequent Events [Text Block] | NOTE 13: SUBSEQUENT EVENTS | ||
The Company has evaluated subsequent events occurring after the balance sheet date and through March 17, 2015, the date that these financial statements have been issued, has identified the following subsequent events and analyzing the transactions for proper accounting treatment: | |||
During February and March 2015, the Company: | |||
· | On February 26, 2015, the our parent Company, Next 1, entered an exchange agreement hereby exchanging $441,403 of Next 1 debt, Next 1 Series A Preferred and Next 1 Series B Preferred for the issuance of 5,514,030 shares of RealBiz common stock. | ||
· | received $195,000 in proceeds and issued convertible promissory notes with interest rates of 12% per annum, maturity dates of December 31, 2016 and with a range of fixed rate conversion features. | ||
· | received $15,000 in proceeds and issued 150,000 shares of common stock. | ||
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended | |||
Jan. 31, 2015 | ||||
Accounting Policies [Abstract] | ||||
Use of Estimates, Policy [Policy Text Block] | Use of Estimates | |||
The preparation of unaudited consolidated financial statements in conformity with accounting principles generally accepted in the United States of America 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 date of the unaudited consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. If actual results significantly differ from the Company’s estimates, the Company’s financial condition and results of operations could be materially impacted. | ||||
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents | |||
For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents at January 31, 2015 and October 31, 2014. | ||||
Trade and Other Accounts Receivable, Policy [Policy Text Block] | Accounts Receivable | |||
The Company provides its marketing and promotional services to agents or brokers via a web-based portal that allows for credit card payments. The Company recognizes accounts receivable for amounts uncollected from the credit card service provider at the end of the accounting period. The Company regularly reviews outstanding receivables and provides for estimated losses through an allowance for doubtful accounts. In evaluating the level of established loss reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events and other factors. As the financial condition of these parties change, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. The Company maintains reserves for potential credit losses, and such losses traditionally have been within its expectations. The allowance for doubtful accounts at January 31, 2015 and October 31, 2014, respectively is $-0-. | ||||
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment | |||
All expenditures on the acquisition for property and equipment are recorded at cost and capitalized as incurred, provided the asset benefits the Company for a period of more than one year. Expenditures on routine repairs and maintenance of property and equipment are charged directly to operating expense. The property and equipment is depreciated based upon its estimated useful life after being placed in service. The estimated useful life of computer equipment is 3 years. When equipment is retired, sold or impaired, the resulting gain or loss is reflected in earnings. The Company incurred depreciation expense of $5,415 and $1,761 for the three months ended January 31, 2015 and 2014, respectively. | ||||
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Impairment of Long-Lived Assets | |||
In accordance with Accounting Standards Codification 360-10, “Property, Plant and Equipment”, the Company periodically reviews its long- lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. As of January 31, 2015, the Company did not impair any long-lived assets. | ||||
Website Development Costs [Policy Text Block] | Website Development Costs | |||
The Company accounts for website development costs in accordance with Accounting Standards Codification 350-50 “Website Development Costs”. Accordingly, all costs incurred in the planning stage are expensed as incurred, costs incurred in the website application and infrastructure development stage that meet specific criteria are capitalized and costs incurred in the day to day operation of the website are expensed as incurred. | ||||
Software to be Sold, Leased, or Otherwise Marketed, Policy [Policy Text Block] | Software Development Costs | |||
The Company capitalizes internal software development costs subsequent to establishing technological feasibility of a software application in accordance with guidelines established by "350-40" Internal Use Software, requiring certain software development costs to be capitalized upon the establishment of technological feasibility. The establishment of technological feasibility and the ongoing assessment of the recoverability of these costs require considerable judgment by management with respect to certain external factors such as anticipated future revenue, estimated economic life, and changes in software and hardware technologies. Amortization of the capitalized software development costs begins when the product is available for general release to customers. Capitalized costs are amortized based on the greater of (a) the ratio of current gross revenues to the total current and anticipated future gross revenues, or (b) the straight-line method over the remaining estimated economic life of the product and is included in operating expenses in the accompanying statement of operations. For the three months ended January 31, 2015, the Company has capitalized $31,810 of costs associated with the development of a mobile app that has been placed into service on February 4, 2015 and will begin amortization of all capitalized costs in the second quarter of the current fiscal year. | ||||
Goodwill and Intangible Assets, Policy [Policy Text Block] | Goodwill and Other Intangible Assets | |||
In accordance with ASC 350-30-65 “Goodwill and Other Intangible Assets", the Company assesses the impairment of identifiable intangible assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following: | ||||
1 | Significant underperformance compared to historical or projected future operating results; | |||
2 | Significant changes in the manner or use of the acquired assets or the strategy for the overall business; and | |||
3 | Significant negative industry or economic trends. | |||
When the Company determines that the carrying value of an intangible may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flow, the Company records an impairment charge equal to the amount that the book value exceeds fair value. The Company measures fair value based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent to the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. The Company did not consider it necessary to record an impairment charge on its intangible assets during the three months ended January 31, 2015 and 2014. | ||||
Intellectual properties that have finite useful lives are amortized over their useful lives. The Company incurred amortization expense related to website development costs and other intangible assets of $509,109 and $344,337 for the three months ended January 31, 2015 and 2014, respectively. This amortization is included in technology and development expenses and general and administrative expenses in the accompanying statement of operations. | ||||
Derivatives, Policy [Policy Text Block] | Derivative Instruments | |||
The Company enters into financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with Accounting Standards Codification topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretations of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, considering all of the rights and obligations of each instrument. | ||||
The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered consistent with the objective measuring fair values. In selecting the appropriate technique, the Company considers, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. For less complex derivative instruments, such as freestanding warrants, the Company generally uses the Black-Scholes model, adjusted for the effect of dilution, because it embodies all of the requisite assumptions (including trading volatility, estimated terms, dilution and risk free rates) necessary to fair value these instruments. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of our common stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimates and assumption changes. Under the terms of the new accounting standard, increases in the trading price of the Company’s common stock and increases in fair value during a given financial quarter result in the application of non-cash derivative expense. Conversely, decreases in the trading price of the Company’s common stock and decreases in trading fair value during a given financial quarter result in the application of non-cash derivative income. | ||||
Based upon ASC 815-25 the Company has adopted a sequencing approach regarding the application of ASC 815-40 to its outstanding convertible debentures. Pursuant to the sequencing approach, the Company evaluates its contracts based upon earliest issuance date. | ||||
Debt, Policy [Policy Text Block] | Convertible Debt Instruments | |||
The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the FASB Accounting Standards Codification. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt. | ||||
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments | |||
The Company adopted ASC topic 820, “Fair Value Measurements and Disclosures” (ASC 820), formerly SFAS No. 157 “Fair Value Measurements,” effective January 1, 2009. ASC 820 defines “fair value” as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There was no impact relating to the adoption of ASC 820 to the Company’s unaudited consolidated financial statements. | ||||
ASC 820 also describes three levels of inputs that may be used to measure fair value: | ||||
Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets. | ||||
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. | ||||
Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. | ||||
Financial instruments consist principally of cash, accounts receivable, prepaid expenses, due from affiliates, accounts payable, accrued liabilities and other current liabilities. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short- term nature. The fair value of long-term debt is based on current rates at which the Company could borrow funds with similar remaining maturities. The carrying amounts approximate fair value. It is management’s opinion that the Company is not exposed to any significant currency or credit risks arising from these financial instruments. | ||||
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition | |||
The Company recognizes revenue when all of the following criteria are met: (1) persuasive evidence of an arrangement exits; (2) delivery has occurred or services have been rendered; (3) the Company's price to its customer is fixed or determinable and (4) collectability is reasonably assured. | ||||
The Company provides its marketing and promotional services to agents or brokers via a web-based portal that allows for credit card payments. Customers may pay a monthly recurring fee or an annual fee. Some customers additionally pay a one-time set up fee. Monthly recurring fees are recognized in the month the service is rendered. Collection of one-time set up fees and annual services fees give rise to recognized monthly revenue in the then-current month as well as deferred revenue liabilities representing the collected fee for services yet to be delivered. | ||||
Cost of Sales, Policy [Policy Text Block] | Cost of Revenues | |||
Cost of revenues includes costs attributable to services sold and delivered. These costs include such items as credit card fees, sales commission to business partners, expenses related to our participation in industry conferences, and public relations expenses. | ||||
Research and Development Expense, Policy [Policy Text Block] | Technology and Development | |||
Costs to research and develop our products are expensed as incurred. These costs consist of primarily of technology and development related expenses including third party contractor fees and technology software services. Technology and development also includes amortization of capitalized costs of the Nestbuilder website associated with the development of our marketplace. The amortization of the Nestbuilder website for the three months ending January 31, 2015 and 2014 is $127,272 and $-0-, respectively. | ||||
Advertising Cost, Policy, Expensed Advertising Cost [Policy Text Block] | Advertising Expense | |||
Advertising costs are charged to expense as incurred and are included in selling and promotions expense in the accompanying unaudited unaudited consolidated financial statements. Advertising expense for the three months ended January 31, 2015 and 2014 was $-0- and $25,880, respectively. | ||||
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Share-Based Compensation | |||
The Company computes share based payments in accordance with Accounting Standards Codification 718-10 “Compensation” (ASC 718-10). ASC 718-10 establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods and services at fair value, focusing primarily on accounting for transactions in which an entity obtains employees services in share-based payment transactions. It also addresses transactions in which an entity incurs liabilities in exchange for goods and services that are based on the fair value of an entity’s equity instruments or that may be settled by the issuance of those equity instruments. In March 2005, the SEC issued SAB No. 107, Share-Based Payment (“SAB 107”) which provides guidance regarding the interaction of ASC 718-10 and certain SEC rules and regulations. The Company has applied the provisions of SAB 107 in its adoption of ASC 718-10. The Company accounts for non-employee share-based awards in accordance with ASC Topic 505-50, Equity Based Payments to Non-Employees. The Company estimates the fair value of stock options by using the Black-Scholes option pricing model. | ||||
Foreign Currency Transactions and Translations Policy [Policy Text Block] | Foreign Currency and Other Comprehensive Income (Loss) | |||
The functional currency of our foreign subsidiaries is typically the applicable local currency. The translation from the respective foreign currencies to United States Dollars (U.S. Dollar) is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for income statement accounts using a weighted average exchange rate during the period. Gains or losses resulting from such translation are included as a separate component of accumulated other comprehensive income. Gains or losses resulting from foreign currency transactions are included in foreign currency income or loss except for the effect of exchange rates on long-term inter-company transactions considered to be a long-term investment, which are accumulated and credited or charged to other comprehensive income. | ||||
Transaction gains and losses are recognized in our results of operations based on the difference between the foreign exchange rates on the transaction date and on the reporting date. We recognized net foreign exchange gain of $9,613 and $7,512 for three months ended January 31, 2015 and 2014, respectively. The foreign currency exchange gains and losses are included as a component of other (income) expense, net, in the accompanying Unaudited Consolidated Statements of Operations. For the three months ended January 31, 2015 and 2014, the accumulated comprehensive gain was $8,063 and $205,529, respectively | ||||
The exchange rate adopted for the foreign exchange transactions are the rates of exchange as quoted on an internet website. Translation of amount from Canadian dollars into United States dollars was made at the following exchange rates for the respective periods: | ||||
⋅ | As of January 31, 2015 - Canadian dollar $0.78970 to US $1.00 | |||
⋅ | For the three months ended January 31, 2015 - Canadian dollar $0.87365 to US $1.00 | |||
Income Tax, Policy [Policy Text Block] | Income Taxes | |||
The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes. Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities and net operating loss and tax credit carryforwards given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which the Company operates, estimates of future taxable income, and available tax planning strategies. If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria of ASC 740. | ||||
ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the unaudited consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. | ||||
Earnings Per Share, Policy [Policy Text Block] | Earnings Per Share | |||
Basic earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. | ||||
Diluted earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. Diluted loss per common share is considered to be equal to basic because it is anti-dilutive. The Company’s common stock equivalents include the following: | ||||
January 31, | ||||
2015 | ||||
Series A convertible preferred stock issued and outstanding | 66,801,653 | |||
Series B convertible preferred stock issued and outstanding | 520,000 | |||
Warrants to purchase common stock issued, outstanding and exercisable | 17,017,730 | |||
Shares on convertible promissory notes | 11,458,119 | |||
95,797,502 | ||||
Concentrations Risks and Uncertainties [Policy Text Block] | Concentrations, Risks and Uncertainties | |||
The Company’s operations are related to the real estate industry and its prospects for success are tied indirectly to interest rates and the general housing and business climates in the United States. | ||||
Reclassification, Policy [Policy Text Block] | Reclassifications | |||
Certain reclassifications have been made in the unaudited consolidated financial statements for comparative purposes. These reclassifications have no effect on the results of operations or financial position of the Company. | ||||
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Issued Accounting Pronouncements | |||
In May 2014, the FASB issued an accounting standard update on revenue recognition that will be applied to all contracts with customers. The update requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. It also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. This guidance will be required to be applied on a retrospective basis, using one of two methodologies, and will be effective for annual reporting periods beginning after December 15, 2016, with early application not being permitted. The Company is currently evaluating the impact that this guidance will have on its financial position and results of operations. | ||||
In August 2014, the FASB issued an accounting standard update which provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. The update requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year of the date the financial statements are issued. It also requires management to provide certain disclosures if conditions or events raise substantial doubt about the entity's ability to continue as a going concern. This guidance will be required for annual reporting periods ending after December 15, 2016, and interim reporting periods thereafter, with early application permitted. The Company is currently evaluating the impact that this guidance will have on its financial position and results of operations. | ||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended | |||
Jan. 31, 2015 | ||||
Accounting Policies [Abstract] | ||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | The Company’s common stock equivalents include the following: | |||
January 31, | ||||
2015 | ||||
Series A convertible preferred stock issued and outstanding | 66,801,653 | |||
Series B convertible preferred stock issued and outstanding | 520,000 | |||
Warrants to purchase common stock issued, outstanding and exercisable | 17,017,730 | |||
Shares on convertible promissory notes | 11,458,119 | |||
95,797,502 | ||||
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended | ||||||||||||
Jan. 31, 2015 | |||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||
Property, Plant and Equipment [Table Text Block] | At January 31, 2015, the Company's property and equipment are as follows: | ||||||||||||
January 31, 2015 | |||||||||||||
Remaining | Accumulated | Net Carrying | |||||||||||
Useful Life | Cost | Depreciation | Value | ||||||||||
Computer equipment - office | 1.5 Years | $ | 22,881 | $ | 11,797 | $ | 11,084 | ||||||
Computer equipment - Nestbuilder website | 2.1 Years | 42,149 | 12,870 | 29,279 | |||||||||
$ | 65,030 | $ | 24,667 | $ | 40,363 | ||||||||
INTANGIBLE_ASSETS_AND_BUSINESS1
INTANGIBLE ASSETS AND BUSINESS COMBINATION (Tables) | 3 Months Ended | ||||||||||||
Jan. 31, 2015 | |||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||
Schedule of Finite-Lived Intangible Assets [Table Text Block] | The following table sets forth the intangible assets, both acquired and developed, including accumulated amortization: | ||||||||||||
January 31, 2015 | |||||||||||||
Remaining | Accumulated | Net Carrying | |||||||||||
Useful Life | Cost | Amortization | Value | ||||||||||
Sales/Marketing agreement | 1.2 Years | $ | 4,796,178 | $ | 3,099,033 | $ | 1,697,145 | ||||||
Website development costs | 2.2 Years | 1,527,307 | 422,111 | 1,105,196 | |||||||||
Web platform/customer relationships - ReachFactor acquisition | 2.3 Years | 600,000 | 262,496 | 337,504 | |||||||||
Software development costs (not placed in service) | 3.0 Years | 84,000 | -0- | 84,000 | |||||||||
$ | 7,007,485 | $ | 3,783,640 | $ | 3,223,845 | ||||||||
ACCOUNTS_PAYABLE_AND_ACCRUED_E1
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 3 Months Ended | ||||
Jan. 31, 2015 | |||||
Payables and Accruals [Abstract] | |||||
Schedule of Accounts Payable and Accrued Liabilities [Table Text Block] | At January 31, 2015, the Company’s accounts payable and accrued expenses are as follows: | ||||
January 31, | |||||
2015 | |||||
Trade payables and accruals | $ | 218,240 | |||
Accrued preferred stock dividends | 915,447 | ||||
Accrued payroll and commissions | 500,875 | ||||
Other liabilities | 218,589 | ||||
Total accounts payable and accrued expenses | $ | 1,853,151 | |||
FAIR_VALUE_MEASUREMENT_AND_DIS1
FAIR VALUE MEASUREMENT AND DISCLOSURE (Tables) | 3 Months Ended | |||||||||||||
Jan. 31, 2015 | ||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||
Schedule of Cash and Cash Equivalents [Table Text Block] | Fair Value Measurements at January 31, 2015 is summarized below: | |||||||||||||
Quoted Prices in | ||||||||||||||
Active Markets | ||||||||||||||
for Identical | Significant Other | Significant | ||||||||||||
Assets | Observable Inputs | Unobservable Inputs | ||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Cash | $ | 141,204 | $ | - | $ | - | $ | 141,204 | ||||||
Derivative liabilities | - | - | 517,630 | 571,630 | ||||||||||
31-Jan-15 | $ | 141,204 | $ | - | $ | 517,630 | $ | 712,834 | ||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 3 Months Ended |
Jan. 31, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share, Amount | 95,797,502 |
Series A Convertible Preferred Stock [Member] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share, Amount | 66,801,653 |
Warrant [Member] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share, Amount | 17,017,730 |
Convertible Debt Securities [Member] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share, Amount | 11,458,119 |
Series B Convertible Preferred Stock [Member] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share, Amount | 520,000 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) (USD $) | 3 Months Ended | 12 Months Ended | |
Jan. 31, 2015 | Jan. 31, 2014 | Oct. 31, 2014 | |
Summary Of Significant Accounting Policies [Line Items] | |||
Foreign Currency Transaction Gain (Loss), before Tax, Total | $9,613 | $7,512 | |
Advertising Expense | 0 | 25,880 | |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 8,063 | 205,529 | |
Foreign Currency Exchange Rate, Translation | 0.7897 | ||
Description of Difference between Reported Amount and Reporting Currency Denominated Amount | Canadian dollar $0.87365 to US $1.00 | ||
Provision for Doubtful Accounts | 0 | 0 | |
Payments for Software | 31,810 | 0 | |
Capitalized Computer Software, Amortization | 127,272 | 0 | |
Amortization of Intangible Assets | 509,109 | 344,337 | |
Computer Equipment [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Depreciation | $5,415 | $1,761 |
GOING_CONCERN_Details_Textual
GOING CONCERN (Details Textual) (USD $) | 3 Months Ended | ||
Jan. 31, 2015 | Jan. 31, 2014 | Oct. 31, 2014 | |
Going Concern [Line Items] | |||
Net losses | $1,665,072 | $1,451,978 | |
Working capital deficit | 2,452,543 | ||
Accumulated deficit | $17,041,710 | $15,376,638 |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | 3 Months Ended | |
Jan. 31, 2015 | Oct. 31, 2014 | |
Property, Plant and Equipment [Line Items] | ||
Cost | $65,030 | |
Accumulated Depreciation | 24,667 | |
Net Carrying Value | 40,363 | 45,778 |
Computer Equipment Office [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Remaining Useful Life | 1 year 6 months | |
Cost | 22,881 | |
Accumulated Depreciation | 11,797 | |
Net Carrying Value | 11,084 | |
Computer Equipment Nestbuilder Website [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Remaining Useful Life | 2 years 1 month 6 days | |
Cost | 42,149 | |
Accumulated Depreciation | 12,870 | |
Net Carrying Value | $29,279 |
PROPERTY_AND_EQUIPMENT_Details1
PROPERTY AND EQUIPMENT (Details Textual) (Computer Equipment [Member], USD $) | 3 Months Ended | |
Jan. 31, 2015 | Jan. 31, 2014 | |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation | $5,415 | $1,761 |
INTANGIBLE_ASSETS_AND_BUSINESS2
INTANGIBLE ASSETS AND BUSINESS COMBINATION (Details) (USD $) | 3 Months Ended | |
Jan. 31, 2015 | Oct. 31, 2014 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $7,007,485 | |
Finite-Lived Intangible Assets, Accumulated Amortization | 3,783,640 | |
Finite-Lived Intangible Assets, Net, Total | 3,223,845 | 3,701,144 |
Sales or Marketing Agreement [Member] | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 1 year 2 months 12 days | |
Finite-Lived Intangible Assets, Gross | 4,796,178 | |
Finite-Lived Intangible Assets, Accumulated Amortization | 3,099,033 | |
Finite-Lived Intangible Assets, Net, Total | 1,697,145 | |
Website Development Costs [Member] | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 2 years 2 months 12 days | |
Finite-Lived Intangible Assets, Gross | 1,527,307 | |
Finite-Lived Intangible Assets, Accumulated Amortization | 422,111 | |
Finite-Lived Intangible Assets, Net, Total | 1,105,196 | |
Web Platform or Customer relationships ReachFactor Acquisition [Member] | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 2 years 3 months 18 days | |
Finite-Lived Intangible Assets, Gross | 600,000 | |
Finite-Lived Intangible Assets, Accumulated Amortization | 262,496 | |
Finite-Lived Intangible Assets, Net, Total | 337,504 | |
Software Development Cost (Not Placed in Service) [Member] | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 3 years | |
Finite-Lived Intangible Assets, Gross | 84,000 | |
Finite-Lived Intangible Assets, Accumulated Amortization | 0 | |
Finite-Lived Intangible Assets, Net, Total | $84,000 |
INTANGIBLE_ASSETS_AND_BUSINESS3
INTANGIBLE ASSETS AND BUSINESS COMBINATION (Details Textual) (USD $) | 3 Months Ended | |
Jan. 31, 2015 | Jan. 31, 2014 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 4 years | |
Amortization of Intangible Assets | $509,109 | $344,337 |
Website [Member] | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 3 years | |
Amortization of Intangible Assets | 509,109 | 344,377 |
Software Development Cost Not Placed in Service [Member] | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Costs Incurred, Development Costs | $31,810 |
ACCOUNTS_PAYABLE_AND_ACCRUED_E2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) (USD $) | Jan. 31, 2015 | Oct. 31, 2014 |
Accounts Payable And Accrued Expenses [Line Items] | ||
Trade payables and accruals | $218,240 | |
Accrued preferred stock dividends | 915,447 | |
Accrued payroll and commissions | 500,875 | |
Other liabilities | 218,589 | |
Total accounts payable and accrued expenses | $1,853,151 | $1,880,294 |
DUE_FROMTO_AFFILIATES_Details_
DUE FROM/TO AFFILIATES (Details Textual) (Parent Company [Member], USD $) | Jan. 31, 2015 |
Parent Company [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Due To Affiliate, Current | $337,093 |
CONVERTIBLE_NOTES_PAYABLE_Deta
CONVERTIBLE NOTES PAYABLE (Details Textual) (USD $) | 1 Months Ended | 2 Months Ended | 3 Months Ended | ||
Oct. 20, 2014 | Jan. 31, 2015 | Jan. 31, 2015 | Jan. 31, 2014 | Oct. 31, 2014 | |
Short-term Debt [Line Items] | |||||
Debt Instrument, Convertible, Conversion Price | $0.20 | $0.10 | $0.10 | ||
Proceeds from Convertible Debt | $95,000 | $935,000 | $935,000 | $0 | |
Loan Processing Fee | 55,000 | ||||
Debt Conversion, Converted Instrument, Warrants or Options Issued | 300,000 | ||||
Common Stock, Par or Stated Value Per Share | $0.00 | $0.00 | $0.00 | $0.00 | |
Shares Issued, Price Per Share | $0.17 | ||||
Debt Conversion, Converted Instrument, Rate | 65.00% | ||||
Debt Instrument, Unamortized Discount | 150,000 | 0 | 0 | 0 | |
Embedded Derivative, Fair Value of Embedded Derivative Liability | 14,760 | 14,760 | |||
Debt Instrument, Term | 2 years | ||||
Debt Instrument, Interest Rate, Stated Percentage | 12.00% | 12.00% | |||
Debt Instrument, Maturity Date | 31-Dec-16 | ||||
Debt Instrument, Interest Rate Terms | Interest shall accrue on the principal of the note at a rate equal to 12.0% per annum in cash and 12.0% in stock per annum based upon $0.10 (ten) cents per share. | ||||
Interest Expense, Debt | 14,399 | ||||
Debt Instrument, Interest Rate, Stated Amount | 11,955 | 0 | |||
Debt Instrument, Remaining Unamortized Discount | 691,441 | ||||
Derivative Instruments and Hedging Activities [Member] | |||||
Short-term Debt [Line Items] | |||||
Proceeds from Convertible Debt | 150,000 | ||||
Fair Value Assumptions, Risk Free Interest Rate | 0.47% | ||||
Fair Value Assumptions, Expected Dividend Rate | 0.00% | ||||
Fair Value Assumptions, Expected Volatility Rate | 359.42% | ||||
Fair Value Assumptions, Expected Term | 1 year 8 months 12 days | ||||
Embedded Derivative, Fair Value of Embedded Derivative Liability | 571,630 | 571,630 | |||
Interest Expense, Debt | 18,260 | ||||
Debt Instrument, Interest Rate, Stated Amount | 4,233 | 0 | |||
Debt Instrument, Remaining Unamortized Discount | 128,535 | ||||
Embedded Derivative, Fair Value of Embedded Derivative, Net | 266,410 | 266,410 | 305,220 | ||
Warrant [Member] | |||||
Short-term Debt [Line Items] | |||||
Fair Value Assumptions, Expected Dividend Rate | 0.00% | ||||
Fair Value Assumptions, Expected Term | 1 year 6 months | ||||
Maximum [Member] | |||||
Short-term Debt [Line Items] | |||||
Fair Value Assumptions, Risk Free Interest Rate | 1.51% | ||||
Fair Value Assumptions, Expected Volatility Rate | 124.65% | ||||
Minimum [Member] | |||||
Short-term Debt [Line Items] | |||||
Fair Value Assumptions, Risk Free Interest Rate | 0.94% | ||||
Fair Value Assumptions, Expected Volatility Rate | 115.05% | ||||
Convertible Debt [Member] | |||||
Short-term Debt [Line Items] | |||||
Debt Conversion, Converted Instrument, Rate | 7.50% | ||||
Convertible Notes Payable [Member] | |||||
Short-term Debt [Line Items] | |||||
Debt Instrument, Unamortized Discount | $705,780 | $705,780 |
LOANS_PAYABLE_Details_Textual
LOANS PAYABLE (Details Textual) (USD $) | Jan. 31, 2015 | Oct. 31, 2014 |
Debt Instrument [Line Items] | ||
Loans Payable, Current, Total | $170,000 | $170,000 |
Non-Related Third Party Investors [Member] | ||
Debt Instrument [Line Items] | ||
Loans Payable, Current, Total | $170,000 |
STOCKHOLDERS_EQUITY_Details_Te
STOCKHOLDERS' EQUITY (Details Textual) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | ||||
Jan. 31, 2015 | Oct. 31, 2014 | Jan. 31, 2014 | Oct. 20, 2014 | Jul. 31, 2014 | Apr. 30, 2014 | Oct. 14, 2014 | |
Shareholders Equity [Line Items] | |||||||
Common Stock, Shares Authorized | 250,000,000 | 250,000,000 | 250,000,000 | 125,000,000 | |||
Common Stock, Par or Stated Value Per Share | $0.00 | $0.00 | $0.00 | ||||
Preferred stock dividend accruals | $915,447 | ||||||
Common Stock And Preferred Stock Authorized | 375,000,000 | ||||||
Preferred Stock Conversion Price Per Share | $0.05 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Outstanding, Weighted Average Remaining Contractual Terms | 21 months | ||||||
Debt Instrument, Unamortized Discount | 0 | 0 | 150,000 | ||||
Common Stock Shares Originally Held In Escrow | 750,000 | ||||||
Stock Retired During Period Value | 750 | ||||||
Debt Instrument, Convertible, Conversion Price | $0.10 | $0.20 | |||||
Convertible Notes Payable [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Debt Instrument, Unamortized Discount | 705,780 | ||||||
Consulting Fee [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Stock Issued During Period, Shares, Issued for Services | 1,271,350 | ||||||
Proceeds From Issuance Of Common Stock and Warrants | 170,685 | ||||||
Series A Preferred Stock [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Common Stock, Shares Authorized | 120,000,000 | 100,000,000 | |||||
Preferred Stock, Par or Stated Value Per Share | $0.00 | $0.00 | |||||
Preferred Stock, Shares Issued | 66,801,653 | 66,801,653 | |||||
Preferred Stock, Dividend Rate, Percentage | 10.00% | ||||||
Preferred Stock, Shares Authorized | 120,000,000 | 120,000,000 | 120,000,000 | 100,000,000 | |||
Preferred Stock Conversion Price Per Share | $1 | ||||||
Series B Preferred Stock [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Preferred Stock, Par or Stated Value Per Share | $0.00 | $0.00 | |||||
Preferred Stock, Shares Issued | 26,000 | 0 | |||||
Preferred stock dividend accruals | 5,540 | ||||||
Preferred Stock, Dividend Rate, Percentage | 10.00% | ||||||
Conversion of Stock, Shares Issued | 900,000 | 7,895,000 | |||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||
Number Of Shares Designated | 1,000,000 | ||||||
Preferred Stock Conversion Price Per Share | $0.05 | ||||||
Preferred Stock Stated Value | $5 | ||||||
Conversion of Stock, Amount Issued | 45,000 | 349,750 | |||||
Series B Preferred Stock [Member] | Next 1 Interactive Inc [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 26,000 | ||||||
Preferred Stock, Shares Authorized | 1,250,000 | ||||||
Conversion of Stock, Amount Issued | 30,000 | ||||||
Series B Preferred Stock [Member] | Maximum [Member] | Next 1 Interactive Inc [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $0.05 | ||||||
Stock Issued During Period, Value, Subscription | 130,000 | ||||||
Series B Preferred Stock [Member] | Minimum [Member] | Next 1 Interactive Inc [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $0.01 | ||||||
Stock Issued During Period, Value, Subscription | 100,000 | ||||||
Series D Preferred Stock [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Conversion of Stock, Shares Issued | 549,945 | 817,418 | |||||
Conversion of Stock, Amount Issued | 82,500 | 122,625 | |||||
Series A Convertible Preferred Stock [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Preferred stock dividend accruals | 158,209 | ||||||
Debt Instrument, Convertible, Conversion Price | $1 | ||||||
Common Stock One [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Class of Warrant or Right, Outstanding | 750,000 | ||||||
Proceeds From Issuance Of Common Stock and Warrants | 75,000 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $0.18 | ||||||
Conversion of Convertible Series B Preferred Shares [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 900,000 | ||||||
Stock Issued During Period, Value, New Issues | 45,000 | ||||||
Conversion of Convertible Series C Preferred Shares [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 770,000 | ||||||
Stock Issued During Period, Value, New Issues | 77,000 | ||||||
Conversion of Convertible Series D Preferred Shares [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 549,945 | ||||||
Stock Issued During Period, Value, New Issues | 82,500 | ||||||
Employee Stock Option [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 26,500 | ||||||
Stock Issued During Period, Value, New Issues | 3,180 | ||||||
Warrant [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Conversion of Stock, Shares Issued | 100,000 | 9,000 | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $0.50 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 17,017,730 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $0.40 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted | 2,350,000 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Expirations | 711,128 | ||||||
Common Stock [Member] | |||||||
Shareholders Equity [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 816,667 | ||||||
Conversion of Stock, Shares Issued | 100,000 | 27,000 | |||||
Conversion Of Stock Settlement Of Debt Value | 30,000 | ||||||
Conversion of Stock, Amount Issued | $30,000 | $13,500 |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details Textual) (USD $) | 3 Months Ended |
Jan. 31, 2015 | |
Related Party Transaction [Line Items] | |
Payments for Rent | $800 |
FAIR_VALUE_MEASUREMENT_AND_DIS2
FAIR VALUE MEASUREMENT AND DISCLOSURE (Details) (USD $) | Jan. 31, 2015 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Cash | $141,204 |
Derivative liabilities | 571,630 |
Cash, total | 712,834 |
Fair Value, Inputs, Level 1 [Member] | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Cash | 141,204 |
Derivative liabilities | 0 |
Cash, total | 141,204 |
Fair Value, Inputs, Level 2 [Member] | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Cash | 0 |
Derivative liabilities | 0 |
Cash, total | 0 |
Fair Value, Inputs, Level 3 [Member] | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Cash | 0 |
Derivative liabilities | 517,630 |
Cash, total | $517,630 |
SUBSEQUENT_EVENTS_Details_Text
SUBSEQUENT EVENTS (Details Textual) (USD $) | 1 Months Ended | 2 Months Ended | 3 Months Ended | ||
Feb. 26, 2015 | Oct. 20, 2014 | Jan. 31, 2015 | Jan. 31, 2015 | Jan. 31, 2014 | |
Subsequent Event [Line Items] | |||||
Proceeds from Convertible Debt | $95,000 | $935,000 | $935,000 | $0 | |
Debt Conversion, Original Debt, Amount | 441,403 | ||||
Debt Conversion, Converted Instrument, Shares Issued | 5,514,030 | ||||
Common Stock [Member] | |||||
Subsequent Event [Line Items] | |||||
Stock Issued During Period, Shares, New Issues | 816,667 | ||||
Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Proceeds from Convertible Debt | 195,000 | ||||
Debt Instrument, Interest Rate, Effective Percentage | 12.00% | 12.00% | |||
Stock Issued During Period, Value, New Issues | $15,000 | ||||
Stock Issued During Period, Shares, New Issues | 150,000 | ||||
Next 1 Interactive Inc [Member] | Series B Preferred Stock [Member] | |||||
Subsequent Event [Line Items] | |||||
Stock Issued During Period, Shares, New Issues | 26,000 |