Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 12, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 000-56059 | |
Entity Registrant Name | CERBERUS CYBER SENTINEL CORPORATION | |
Entity Central Index Key | 0001777319 | |
Entity Tax Identification Number | 83-4210278 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 6900 E. Camelback Road | |
Entity Address, Address Line Two | Suite 240 | |
Entity Address, City or Town | Scottsdale | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85251 | |
City Area Code | (480) | |
Local Phone Number | 389-3444 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 117,789,789 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | |
Current Assets: | |||
Cash and cash equivalents | $ 2,729,579 | $ 5,197,030 | |
Accounts receivable, net of allowances for doubtful accounts of $76,200 and $40,000, respectively | 2,268,833 | 1,006,834 | |
Prepaid expenses and other current assets | 485,617 | 142,144 | |
Total Current Assets | 5,484,029 | 6,346,008 | |
Property and equipment, net of accumulated depreciation of $30,310 and $14,473, respectively | 89,401 | 80,630 | |
Right of use asset, net | 268,096 | 13,426 | |
Intangible assets, net of accumulated amortization of $226,964 and $116,468, respectively | 2,359,402 | 2,105,432 | |
Goodwill | 20,695,024 | [1] | 4,101,369 |
Total Assets | 28,895,952 | 12,646,865 | |
Current Liabilities: | |||
Accounts payable and accrued expenses | 1,494,159 | 809,804 | |
Stock payable | 79,950 | 46,000 | |
Lease liability, current portion | 166,709 | 8,989 | |
Loans payable, current portion | 115,981 | 9,405 | |
Line of credit | 3,000 | ||
Convertible note payable, net of debt discount, related party | 2,981,401 | 2,926,609 | |
Note payable, related party | 59,787 | ||
Total Current Liabilities | 4,838,200 | 3,863,594 | |
Long-term Liabilities: | |||
Loans payable, net of current portion | 443,373 | 1,037,115 | |
Lease liability, net of current portion | 107,899 | 4,693 | |
Total Liabilities | 5,389,472 | 4,905,402 | |
Commitments and Contingencies | |||
Stockholders’ Equity: | |||
Common stock, $.00001 par value; 250,000,000 shares authorized; 120,529,649 and 116,104,971 shares issued and outstanding on September 30, 2021 and December 31, 2020, respectively | 1,205 | 1,161 | |
Additional paid-in capital | 34,518,667 | 12,607,074 | |
Accumulated deficit | (11,013,392) | (4,866,772) | |
Total Stockholders’ Equity | 23,506,480 | 7,741,463 | |
Total Liabilities and Stockholders’ Equity | $ 28,895,952 | $ 12,646,865 | |
[1] | As of September 30, 2021, the Company had not obtained a third-party valuation for the August 12, 2021, acquisition of VelocIT. As such, the purchase price allocation disclosed in this Quarterly Report for September 30, 2021, may change and, therefore, goodwill from the acquisition may change. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Allowances for doubtful accounts | $ 76,200 | $ 40,000 |
Property plant and equipment, accumulated depreciation | 30,310 | 14,473 |
Intangible assets, accumulated depreciation | $ 226,964 | $ 116,468 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 120,529,649 | 116,104,971 |
Common stock, shares outstanding | 120,529,649 | 116,104,971 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue: | ||||
Total revenue | $ 3,745,008 | $ 2,009,598 | $ 9,254,583 | $ 4,628,305 |
Cost of revenue: | ||||
Total cost of revenue | 2,978,353 | 1,311,556 | 6,729,860 | 2,945,297 |
Total gross profit | 766,655 | 698,042 | 2,524,723 | 1,683,008 |
Operating expenses: | ||||
Professional fees | 293,408 | 284,511 | 695,023 | 685,821 |
Advertising and marketing | 254,026 | 30,488 | 471,721 | 104,058 |
Selling, general and administrative | 2,085,720 | 1,020,765 | 5,241,095 | 2,235,041 |
Stock based compensation | 1,251,635 | 392,661 | 2,981,523 | 1,062,000 |
Loss on write-off of account receivable | 40,264 | 55,528 | 15,000 | |
Total operating expenses | 3,925,053 | 1,728,425 | 9,444,890 | 4,101,920 |
Loss from operations | (3,158,398) | (1,030,383) | (6,920,167) | (2,418,912) |
Other income (expense): | ||||
Other income | 169 | 751 | 2,553 | 10,751 |
Interest expense, net | (75,470) | (5,567) | (209,806) | (12,285) |
PPP loan forgiveness | 980,800 | 980,800 | ||
Total other income (expense) | 905,499 | (4,816) | 773,547 | (1,534) |
Net loss | $ (2,252,899) | $ (1,035,199) | $ (6,146,620) | $ (2,420,446) |
Net loss per common share - basic | $ (0.02) | $ (0.01) | $ (0.05) | $ (0.02) |
Net loss per common share - diluted | $ (0.02) | $ (0.01) | $ (0.05) | $ (0.02) |
Weighted average shares outstanding - basic | 118,856,026 | 113,174,336 | 117,801,672 | 110,305,671 |
Weighted average shares outstanding - diluted | 118,856,026 | 113,174,336 | 117,801,672 | 110,305,671 |
Security Managed Services [Member] | ||||
Revenue: | ||||
Total revenue | $ 3,099,753 | $ 1,683,733 | $ 6,979,146 | $ 3,612,489 |
Cost of revenue: | ||||
Total cost of revenue | 650,955 | 423,784 | 1,326,788 | 726,614 |
Professional Services [Member] | ||||
Revenue: | ||||
Total revenue | 645,255 | 325,865 | 2,275,437 | 1,015,816 |
Cost of revenue: | ||||
Total cost of revenue | 234,326 | 18,962 | 350,388 | 82,992 |
Cost Of Payroll [Member] | ||||
Cost of revenue: | ||||
Total cost of revenue | $ 2,093,072 | $ 868,810 | $ 5,052,684 | $ 2,135,691 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Deficit (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Treasury Stock [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 1,139 | $ 7,770,902 | $ (1,453,510) | $ (2,400,000) | $ 3,918,531 |
Beginning balance, shares at Dec. 31, 2019 | 107,912,500 | ||||
Stock based compensation - stock options | 325,429 | 325,429 | |||
Common shares issued for cash | $ 4 | 139,996 | 140,000 | ||
Stock issued for cash, shares | 350,000 | ||||
Return of treasury stock to authorized capital | $ (60) | (2,399,940) | 2,400,000 | ||
Net loss | (839,144) | (839,144) | |||
Ending balance, value at Mar. 31, 2020 | $ 1,083 | 5,836,387 | (2,292,654) | 3,544,816 | |
Ending balance, shares at Mar. 31, 2020 | 108,262,500 | ||||
Beginning balance, value at Dec. 31, 2019 | $ 1,139 | 7,770,902 | (1,453,510) | (2,400,000) | 3,918,531 |
Beginning balance, shares at Dec. 31, 2019 | 107,912,500 | ||||
Net loss | (2,420,446) | ||||
Ending balance, value at Sep. 30, 2020 | $ 1,143 | 9,511,806 | (3,873,956) | 5,638,993 | |
Ending balance, shares at Sep. 30, 2020 | 114,309,771 | ||||
Beginning balance, value at Mar. 31, 2020 | $ 1,083 | 5,836,387 | (2,292,654) | 3,544,816 | |
Beginning balance, shares at Mar. 31, 2020 | 108,262,500 | ||||
Stock based compensation - stock options | 343,910 | 343,910 | |||
Stock issued for Clear Skies acquisition | $ 34 | 1,356,874 | 1,356,908 | ||
Stock issued for clear skies acquisition, shares | 3,392,271 | ||||
Net loss | (546,103) | (546,103) | |||
Ending balance, value at Jun. 30, 2020 | $ 1,117 | 7,537,171 | (2,838,757) | 4,699,531 | |
Ending balance, shares at Jun. 30, 2020 | 111,654,771 | ||||
Stock based compensation - stock options | 392,661 | 392,661 | |||
Common shares issued for cash | $ 3 | 649,997 | 650,000 | ||
Stock issued for cash, shares | 325,000 | ||||
Stock issued for Clear Skies acquisition | $ 23 | 931,977 | 932,000 | ||
Stock issued for clear skies acquisition, shares | 2,330,000 | ||||
Net loss | (1,035,199) | (1,035,199) | |||
Ending balance, value at Sep. 30, 2020 | $ 1,143 | 9,511,806 | (3,873,956) | 5,638,993 | |
Ending balance, shares at Sep. 30, 2020 | 114,309,771 | ||||
Beginning balance, value at Dec. 31, 2020 | $ 1,161 | 12,607,074 | (4,866,772) | 7,741,463 | |
Beginning balance, shares at Dec. 31, 2020 | 116,104,971 | ||||
Stock based compensation - stock options | 838,762 | 838,762 | |||
Common shares issued for cash | $ 16 | 3,249,984 | 3,250,000 | ||
Stock issued for cash, shares | 1,625,000 | ||||
Net loss | (1,776,859) | (1,776,859) | |||
Ending balance, value at Mar. 31, 2021 | $ 1,177 | 16,695,820 | (6,643,631) | 10,053,366 | |
Ending balance, shares at Mar. 31, 2021 | 117,729,971 | ||||
Beginning balance, value at Dec. 31, 2020 | $ 1,161 | 12,607,074 | (4,866,772) | 7,741,463 | |
Beginning balance, shares at Dec. 31, 2020 | 116,104,971 | ||||
Net loss | (6,146,620) | ||||
Ending balance, value at Sep. 30, 2021 | $ 1,205 | 34,518,667 | (11,013,392) | 23,506,480 | |
Ending balance, shares at Sep. 30, 2021 | 120,529,649 | ||||
Beginning balance, value at Mar. 31, 2021 | $ 1,177 | 16,695,820 | (6,643,631) | 10,053,366 | |
Beginning balance, shares at Mar. 31, 2021 | 117,729,971 | ||||
Stock based compensation - stock options | 891,126 | 891,126 | |||
Net loss | (2,116,862) | (2,116,862) | |||
Ending balance, value at Jun. 30, 2021 | $ 1,177 | 17,586,946 | (8,760,493) | 8,827,630 | |
Ending balance, shares at Jun. 30, 2021 | 117,729,971 | ||||
Stock based compensation - stock options | 1,251,635 | 1,251,635 | |||
Stock based compensation - shares | $ 2 | 279,443 | 279,445 | ||
Stock based compensation - shares, shares | 232,900 | ||||
Stock issued for Clear Skies acquisition | $ 26 | 15,400,643 | 15,400,669 | ||
Stock issued for clear skies acquisition, shares | 2,566,778 | ||||
Net loss | (2,252,899) | (2,252,899) | |||
Ending balance, value at Sep. 30, 2021 | $ 1,205 | $ 34,518,667 | $ (11,013,392) | $ 23,506,480 | |
Ending balance, shares at Sep. 30, 2021 | 120,529,649 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net loss | $ (6,146,620) | $ (2,420,446) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock based compensation - stock options | 2,981,523 | 1,062,000 |
Loss on write-off of accounts receivable | 55,528 | 15,000 |
Issuance of common stock for services | 313,395 | 34,000 |
Depreciation and amortization | 131,403 | 55,365 |
Right of use amortization | 75,842 | 3,729 |
Amortization of debt discount | 54,792 | |
Forgiveness of PPP Loan | (980,800) | |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (355,946) | (191,958) |
Other current assets | (305,532) | (77,083) |
Accounts payable and accrued expenses | (66,311) | 364,961 |
Lease liability | (69,586) | (3,544) |
Net cash used in operating activities | (4,312,312) | (1,157,976) |
Cash flows from investing activities: | ||
Cash acquired in acquisitions | 662,176 | 254,180 |
Net cash provided by investing activities | 662,176 | 254,180 |
Cash flows from financing activities: | ||
Proceeds from sale of common stock | 3,250,000 | 790,000 |
Proceeds from PPP loans | 709,600 | |
Proceeds from line of credit | 221,346 | 60,000 |
Payment on line of credit | (224,346) | (93,705) |
Payment on loans payable | (2,004,528) | (2,737) |
Payment on notes payable, related party | (59,787) | |
Distributions to member | (20,000) | |
Net cash provided by financing activities | 1,182,685 | 1,443,158 |
Net increase (decrease) in cash and cash equivalents | (2,467,451) | 539,362 |
Cash and cash equivalents - beginning of the period | 5,197,030 | 1,876,645 |
Cash and cash equivalents - end of the period | 2,729,579 | 2,416,007 |
Supplemental cash flow information: | ||
Interest | 91,490 | 169 |
Income taxes | 5,882 | |
Non-cash investing and financing activities: | ||
Right of use asset and lease liability recorded | 330,512 | 19,393 |
Forgiveness of PPP Loan | 980,800 | |
Common shares issued in Technologyville acquisition | 1,356,908 | |
Common shares issued in Clear Skies acquisition | $ 932,000 |
NATURE OF THE ORGANIZATION AND
NATURE OF THE ORGANIZATION AND BUSINESS | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF THE ORGANIZATION AND BUSINESS | NOTE 1 – NATURE OF THE ORGANIZATION AND BUSINESS Corporate History Cerberus Cyber Sentinel Corporation (“Cerberus Sentinel,” “Cerberus,” or the “Company”) was formed on March 5, 2019, as a Delaware corporation. The Company’s principal offices are located at 6900 E. Camelback Road, Suite 240, Scottsdale, AZ 85258. Effective May 25, 2020, the Company entered into a Stock Purchase Agreement with Technologyville, Inc., an Illinois corporation (“Techville”), and its sole shareholder, pursuant to which Techville became a wholly owned subsidiary of the Company (the “Techville Acquisition”). Under the terms of the Techville Acquisition, all issued and outstanding common stock of Techville was exchanged for an aggregate of 3,392,271 Effective August 1, 2020, the Company entered into a Stock Purchase Agreement with Clear Skies Security, LLC, a Georgia limited liability company (“Clear Skies”), and its equity holders, pursuant to which Clear Skies became a wholly owned subsidiary of the Company (the “Clear Skies Acquisition”). Under the terms of the Clear Skies Acquisition, all issued and outstanding equity securities in Clear Skies were exchanged for an aggregate of 2,330,000 Effective December 16, 2020, the Company entered into an Agreement and Plan of Merger with Alpine Security, LLC, an Illinois limited liability company (“Alpine”), and its sole member, pursuant to which Alpine became a wholly owned subsidiary of the Company (the “Alpine Acquisition”). Under the terms of the Alpine Acquisition, all issued and outstanding membership units in Alpine were exchanged for an aggregate of 900,000 Effective August 12, 2021, the Company entered into an Agreement and Plan of Merger with Catapult Acquisition Corporation, a New Jersey corporation (“VelocIT”), and its equity holders, pursuant to which VelocIT became a wholly owned subsidiary of the Company (the “Catapult Acquisition”). Under the terms of the Catapult Acquisition, all issued and outstanding equity secruities in VelocIT were exchanged for an aggregate of 2,566,778 shares of the Company’s common stock. Nature of the Business Cerberus Sentinel is a security services company comprised of security professionals who work with clients throughout the United States to create a continuously aware security culture. We do not sell cybersecurity products. We position the Company as a trusted cybersecurity advisor and are committed to delivering tailored security solutions to organizations of different sizes and across all geographies and industries to fit their budgetary needs and limit their cyber threat exposure. We currently provide a multitude of cybersecurity services including managed security service, cybersecurity consulting, technology consulting, compliance auditing, vulnerability assessment, penetration testing, security remediation, Security Operations Center (“SOC”) set-up and consulting and cybersecurity training. We differentiate ourselves from our competitors by staying technology agnostic. We believe that many cybersecurity service providers in the market today are committed to a specific technology solution which limits their service scope and ability to quickly respond to any emerging cybersecurity challenges. In addition, as we continue to serve our clients within our existing capacities, we plan to continue making strategic acquisitions of small-to-medium-sized engineer-led cybersecurity service firms to continue to expand our service scope and geographical coverage. We believe that having a world-class technology team with multi-faceted expertise is key to providing technology agnostic solutions to our clients and maximizing their return on investment from information technology (“IT”) and cybersecurity spending. Liquidity The accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue as a going concern, which contemplates realization of assets and satisfying liabilities in the normal course of business. At September 30, 2021, the Company had an accumulated deficit of $ 11,013,392 and working capital surplus of approximately $ 646,000 . For the nine months ended September 30, 2021, the Company had a loss from operations of approximately $ 6,920,167 and negative cash flows from operations of approximately $ 4,312,312 . Although the Company is showing positive revenues and gross profit trends, the Company expects to incur further losses through the end of 2021. To date the Company has been funding operations primarily through the sale of equity in private placements and revenues generated by the Company’s services. During the nine months ended September 30, 2021, the Company received $ 3,250,000 Based on its current cash resources and commitments, the Company believes it will be able to maintain its current planned development and corresponding level of expenditure for at least twelve months from the date of the issuance of these unaudited condensed consolidated financial statements, although no assurance can be given that it will not need additional funds prior to such time. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial information as of September 30, 2021, and for the three and nine months ended September 30, 2021 and 2020, has been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position at such dates and the operating results and cash flows for such periods. Operating results for the three and nine months ended September 30, 2021, are not necessarily indicative of the results that may be expected for the entire year or for any other subsequent interim period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission, or the SEC. These unaudited financial statements and related notes should be read in conjunction with our audited financial statements for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2021. Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, GenResults, LLC (“GenResults”), TalaTek, Inc. (“TalaTek”), Techville, Clear Skies, Alpine, and VelocIT. All significant intercompany accounts and transactions have been eliminated in consolidation. Reclassifications Certain reclassifications have been made to the financial statements for the three and nine months ended September 30, 2020, to conform to the financial statements presentation for the three and nine months ended September 30, 2021. These reclassifications had no effect on net loss or cash flows as previously reported. Use of Estimates Preparing financial statements in conformity with GAAP 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company believes the critical accounting policies discussed below affect its more significant judgments and estimates used in the preparation of the accompanying unaudited condensed consolidated financial statements. Significant estimates include the allowance for doubtful accounts, the carrying value of intangible assets and goodwill, deferred tax asset and valuation allowance, the estimated fair value of assets acquired, liabilities assumed and stock issued in business combinations and assumptions used in the Black-Scholes option pricing model, such as expected volatility, risk-free interest rate, and expected divided rate. Revenue The Company’s revenues are derived from two major types of services to clients: Managed Services and Consulting Services. With respect to Managed Services, the Company provides culture education and enablement, tools and technology provisioning, data and privacy monitoring, regulations and compliance monitoring, remote infrastructure administration, and cybersecurity services including, but not limited to, antivirus and patch management. With respect to Consulting Services, the Company provides cybersecurity consulting, compliance auditing, vulnerability assessment and penetration testing, and disaster recovery and data backup solutions. Practical Expedients As part of Accounting Standards Codification (“ASC”) 606, the Company has adopted several practical expedients including the following: (i) the Company has determined that it need not adjust the promised amount of consideration for the effects of a significant financing component since the Company expects, at contract inception, that the period between when the Company transfers a promised service to the customer and when the customer pays for that service will be one year or less and (ii) the Company recognizes any incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. Disaggregated Revenues Revenue consists of the following by service offering for the nine months ended September 30, 2021: SCHEDULE OF DISAGGREGATION OF REVENUES Security Managed Services Professional Services Total Primary Sector Markets Public $ 3,179,047 $ 44,579 $ 3,223,626 Private 3,607,146 2,178,545 5,785,691 Not-for-Profit 192,953 52,313 245,266 $ 6,979,146 $ 2,275,437 $ 9,254,583 Major Service Lines Compliance $ 3,336,795 $ - $ 3,336,795 Secured Managed Services 3,134,269 - 3,134,269 SOC Managed Services 352,535 - 352,535 vCISO 155,547 - 155,547 Technical Assessments - 1,844,496 1,844,496 Forensics & I/R - 265,567 265,567 Training - 149,529 149,529 Other CyberSecurity Services - 15,845 15,845 $ 6,979,146 $ 2,275,437 $ 9,254,583 Revenue consists of the following by service offering for the nine months ended September 30, 2020: Security Managed Services Professional Services Total Primary Sector Markets Public $ 2,498,371 $ 5,068 $ 2,503,439 Private 1,024,744 1,001,748 2,026,492 Not-for-Profit 89,374 9,000 98,374 $ 3,612,489 $ 1,015,816 $ 4,628,305 Major Service Lines Compliance $ 2,519,958 $ - $ 2,519,958 Secured Managed Services 752,371 - 752,371 SOC Managed Services 301,760 - 301,760 vCISO 38,400 - 38,400 Technical Assessments - 190,825 190,825 Forensics & I/R - 554,069 554,069 Training - 58,625 58,625 Other CyberSecurity Services - 212,297 212,297 $ 3,612,489 $ 1,015,816 $ 4,628,305 Cash and Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. Accounts Receivable Accounts receivable are reported at their outstanding unpaid principal balances, net of allowances for doubtful accounts. The Company periodically assesses its accounts and other receivables for collectability on a specific identification basis. The Company provides for allowances for doubtful receivables based on management’s estimate of uncollectible amounts considering age, collection history, and any other factors considered appropriate. Payments are generally due within 30 days of invoice. The Company writes off accounts receivable against the allowance for doubtful accounts when a balance is determined to be uncollectible. As of September 30, 2021, and December 31, 2020, the Company’s allowance for doubtful accounts was $ 76,200 and $ 40,000 , respectively. Property and Equipment Property and equipment are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, generally between three and five years. Expenditures that enhance the useful lives of the assets are capitalized and depreciated. Computer equipment costs for the Company are capitalized, as incurred, and depreciated on a straight-line basis over three years. TalaTek capitalizes all equipment costs over $ 5,000 Maintenance and repairs are charged to expense as incurred. At the time of retirement or other disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and the resulting gain or loss, if any, is reflected in results of operations. Impairment of Long-Lived Assets The Company reviews long-lived assets, including finite-lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of these assets is determined by comparing the forecasted undiscounted net cash flows of the operation to which the assets relate to the carrying amount. If the operation is determined to be unable to recover the carrying amount of its assets, then these assets are written down first, followed by other long-lived assets of the operation, to fair value. Fair value is determined based on discounted cash flows or appraised values, depending on the nature of the assets. During the three and nine months ended September 30, 2021, the Company did not record a loss on impairment. Intangible Assets The Company records its intangible assets at cost in accordance with ASC 350, Intangibles – Goodwill and Other Goodwill Goodwill represents the excess of the purchase price of the acquired business over the estimated fair value of the identifiable net assets acquired. Goodwill is not amortized but is tested for impairment at least annually at year end, at the reporting unit level or more frequently if events or changes in circumstances indicate that the asset might be impaired. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the reporting unit’s carrying value is compared to its fair value. The fair values of the reporting units are estimated using market and discounted cash flow approaches. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. The discounted cash flow approach uses expected future operating results. Failure to achieve these expected results may cause a future impairment of goodwill at the reporting unit level (See Note 6). Advertising and Marketing Costs The Company expenses advertising and marketing costs as they are incurred. Advertising and marketing expenses were $ 254,026 30,488 471,721 104,058 Fair Value Measurements As defined in ASC 820, Fair Value Measurements and Disclosures Level 1: Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Level 2: Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reported date. Level 3: Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. The significant unobservable inputs used in the fair value measurement for nonrecurring fair value measurements of long-lived assets include pricing models, discounted cash flow methodologies and similar techniques. Net Loss per Common Share Net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. All vested outstanding options are considered potentially outstanding common stock. The dilutive effect, if any, of stock options is calculated using the treasury stock method. All outstanding convertible notes are considered common stock at the beginning of the period or at the time of issuance, if later, pursuant to the if-converted method. Since the effect of common stock equivalents is anti-dilutive with respect to losses, the options have been excluded from the Company’s computation of net loss per common share for the three and nine months ended September 30, 2021 and 2020. The following tables summarize the securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive due to the Company’s net loss position even though the exercise price could be less than the average market price of the common shares: SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE CALCULATION September 30, 2021 September 30, 2020 Stock Options 27,680,040 21,435,700 Convertible Debt 1,500,000 - Total 29,180,040 21,435,700 Stock-based Compensation The Company applies the provisions of ASC 718, Compensation - Stock Compensation For stock options issued to employees and members of the board of directors for their services, the Company estimates the grant date fair value of each option using the Black-Scholes option pricing model. The use of the Black-Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk-free interest rates and expected dividend yields of the common stock. For awards subject to service-based vesting conditions, including those with a graded vesting schedule, the Company recognizes stock-based compensation expense equal to the grant date fair value of stock options on a straight-line basis over the requisite service period, which is generally the vesting term. Forfeitures are recorded as they are incurred as opposed to being estimated at the time of grant and revised. Due to the Company’s limited history and lack of public trading volume for its common stock, the Company used the average of historical share prices of similar companies within its industry to calculate volatility for use in the Black-Scholes option pricing model. Pursuant to Accounting Standards Update (“ASU”) 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Non-employee Share-Based Payment Accounting Leases Leases in which the Company is the lessee are comprised of corporate offices and property and equipment. All of the leases are classified as operating leases. The Company leases multiple office spaces with a remaining weighted average term of 1.17 0.67 In accordance with ASC 842, Leases Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities, including tax loss and credit carry forwards, are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company utilizes ASC 740, Income Taxes For uncertain tax positions that meet a “more likely than not” threshold, the Company recognizes the benefit of uncertain tax positions in the unaudited condensed consolidated financial statements. The Company’s practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the unaudited condensed consolidated statements of operations when a determination is made that such expense is likely. Recently Issued Accounting Standards In March 2021, the FASB issued ASU No. 2021-03, Intangibles – Goodwill and Other (Topic 350). ASU 2021-03 requires an entity to identify and evaluate goodwill impairment triggering events when they occur to determine whether it is more likely than not that the fair value of a reporting unit (or entity, if the entity has elected the accounting alternative for amortizing goodwill and chosen that option) is less than its carrying amount. If an entity determines that it is more likely than not that the goodwill is impaired. It must test goodwill for impairment using the triggering event date as the measurement date. An entity is required to disclose the amount assigned to goodwill in total and by major business combination, or by reorganization event resulting in fresh-start reporting. Also, the entity must disclose the weighted average amortization period in total and the amortization period by major business combination, or by reorganization event resulting in fresh-start reporting. ASU 2021-03 was effective for the Company on January 1, 2021 and did not have a significant impact on our unaudited condensed consolidated financial statements. In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt — Modifications and Extinguishments (Subtopic 470-50), Compensation — Stock Compensation (Topic 718), and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the Emerging Issues Task Force). The ASU requires issuers to account for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after the modification or exchange based on the economic substance of the modification or exchange. Under the ASU, an issuer determines the accounting for the modification or exchange based on whether the transaction was done to issue equity, to issue or modify debt, or for other reasons. The ASU is applied prospectively and is effective for the Company for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact that adopting this standard will have on the unaudited condensed consolidated financial statements. All newly issued but not yet effective accounting pronouncements have been deemed to be not applicable or immaterial to the Company. |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS | NOTE 3 – ACQUISITIONS Catapult Acquisition Corporation On August 12, 2021, the Company effected an Amended and Restated Agreement and Plan of Merger (the “Merger Agreement”) with Catapult Acquisition Merger Sub, LLC (“Merger Sub”), Catapult Acquisition Corporation (d/b/a VelocIT) (“VelocIT”), the shareholders of VelocIT and Derek Hahn, in his capacity as the shareholder representative. Pursuant to the Merger Agreement, the Merger Sub merged with and into VelocIT, with VelocIT surviving the Merger as a wholly-owned subsidiary of the Company (the “VelocIT Acquisition”). At the effective time of the VelocIT Acquisition, VelocIT’s outstanding common stock was exchanged for 2,566,778 Immediately following the VelocIT Acquisition, the Company had 120,296,749 117,729,971 98% The Company accounted for this transaction in accordance with the acquisition method of accounting for business combinations. Assets and liabilities of the acquired business were included in the consolidated balance sheet as of September 30, 2021, based on the respective estimated fair value on the date of acquisition as determined in a purchase price allocation using available information and making assumptions management believed are reasonable. Per ASC 805, Business Combinations August 12, 2021 During the period subsequent to the effective date of the acquisition, VelocIT recorded revenue of $ 985,146 1,695,276 The following table summarizes the allocation of the purchase price to the fair values of the assets acquired and the liabilities assumed as of the transaction date: SUMMARY OF SIGNIFICANT FAIR VALUE ASSETS ACQUIRED AND LIABILITIES August 12,2021 Consideration paid $ 15,400,668 Tangible assets acquired: Cash 662,176 Accounts receivable 961,581 Prepaid expenses 37,941 Property and equipment 24,608 Capitalizable expenses 5,091 Total tangible assets 1,691,397 Intangible assets acquired: Intellectual property 134,445 Total intangible assets 134,445 Assumed liabilities: Accounts payable 528,571 Accrued expenses 222,095 Loans payable 1,071,313 SBA loan payoff 1,426,850 Total assumed liabilities 3,248,829 Net liabilities assumed (1,422,987 ) Goodwill (a.)(b.) $ 16,823,655 a. Goodwill is the excess of the purchase price over the fair value of the underlying net tangible and identifiable intangible assets. In accordance with applicable accounting standards, goodwill is not amortized but instead is tested for impairment at least annually or more frequently if certain indicators are present. Goodwill and intangibles are not deductible for tax purposes. b. Goodwill represents expected synergies from the merger of operations and intangible assets that do not qualify for separate recognition. Cerberus and VelocIT are both cybersecurity service providers. The acquisition of VelocIT provided Cerberus potential sales synergies resulting from Cerberus’ access to VelocIT’s current client-base to offer additional services. These items will be assigned a fair value upon the completion of the third-party valuation and are not expected to change significantly. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 9 Months Ended |
Sep. 30, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 4 – PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS September 30, 2021 December 31, 2020 Prepaid expenses $ 398,712 $ 128,398 Prepaid insurance 56,125 13,746 Other current assets 30,780 - Total prepaid expenses and other current assets $ 485,617 $ 142,144 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5 – PROPERTY AND EQUIPMENT Property and equipment consists of the following: SCHEDULE OF PROPERTY AND EQUIPMENT September 30, 2021 December 31, 2020 Computer equipment $ 15,735 $ 15,735 Vehicle 63,052 63,052 Furniture and fixtures 30,832 6,224 Software 10,092 10,092 Property and equipment, gross 119,711 95,103 Less: accumulated depreciation (30,310 ) (14,473 ) Property and equipment, net $ 89,401 $ 80,630 Total depreciation expense was $ 6,989 5,361 15,837 8,668 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | NOTE 6 – INTANGIBLE ASSETS AND GOODWILL The following table summarizes the changes in goodwill during the nine months ended September 30, 2021: SCHEDULE OF CHANGES IN GOODWILL Balance December 31, 2020 $ 4,101,369 Acquisition of goodwill 16,823,655 Impairment - Reclassification based on valuation report (1) (230,000 ) Ending balance, September 30, 2021 (2) $ 20,695,024 (1) Subsequent to September 30, 2021, the Company obtained a third-party valuation for the December 16, 2020, acquisition of Alpine. As such, the purchase price allocation disclosed in the Company’s Annual Report in Form 10-K for December 31, 2020, filed on March 31, 2021, changed and, therefore, goodwill changed. (2) As of September 30, 2021, the Company had not obtained a third-party valuation for the August 12, 2021, acquisition of VelocIT. As such, the purchase price allocation disclosed in this Quarterly Report for September 30, 2021, may change and, therefore, goodwill from the acquisition may change. The following table summarizes the identifiable intangible assets as of September 30, 2021, and December 31, 2020: SUMMARY OF IDENTIFIABLE INTANGIBLE ASSETS Useful life September 30, 2021 December 31, 2020 Tradenames – trademarks (1) Indefinite $ 1,211,800 $ 1,094,500 Customer base (1) 15 384,000 370,000 Non-compete agreements (1) 5 242,100 236,400 Intellectual property/technology (1) 10 748,466 521,000 Identifiable intangible assets 2,586,366 2,221,900 Less accumulated amortization (226,964 ) (116,468 ) Total $ 2,359,402 $ 2,105,432 (1) These intangible assets were acquired in the acquisitions of TalaTek, Techville, Clear Skies, Alpine and VelocIT. The weighted average remaining useful life of identifiable amortizable intangible assets remaining is 8.24 Amortization of identifiable intangible assets for the three months ended September 30, 2021 and 2020, was $ 40,506 15,648 110,495 46,944 The below table summarizes the future amortization expense for the remainder of 2021 and the next four years thereafter: SCHEDULE OF FUTURE AMORTIZATION EXPENSE 2 2021 Remainder of 2021 $ 51,709 2022 153,554 2023 125,086 2024 127,939 2025 100,444 Thereafter 588,869 Future Amortization Expense $ 1,147,602 |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 7 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consist of the following amounts: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES September 30, 2021 December 31, 2020 Accounts payable $ 788,268 $ 328,368 Accrued payroll 408,602 39,670 Accrued expenses 265,532 417,832 Accrued commissions 26,678 - Accrued interest – related party 5,079 23,934 Total accounts payable and accrued expenses $ 1,494,159 $ 809,804 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 8 - RELATED PARTY TRANSACTIONS Note Payable – Related Party On December 31, 2018, GenResults entered into an unsecured note payable with Jemmett Enterprises, LLC, the Company’s majority stockholder that is controlled by the Company’s Chief Executive Officer, in the original principal amount of $ 200,000 June 15, 2021 6% 9,787 5,079 23,934 186 3,669 4,595 9,358 Convertible Note Payable, Accounts Receivable and Revenue – Related Party On December 23, 2020, the Company issued to a related party a convertible note in the principal amount of $ 3,000,000 6% 3,000,000 At September 30, 2021, the Company had $ 48,270 305,127 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | Note 9 - STOCKHOLDERS’ EQUITY Equity Transactions During the Period During the nine months ended September 30, 2021, the Company issued an aggregate of 1,625,000 2.00 3,250,000 On August 12, 2021, the Company issued an aggregate of 2,566,778 6.00 On August 16, 2021, the Company issued an aggregate of 232,900 2.05 Stock Payable On January 16, 2020, the Company entered into a consulting agreement, with Eskenzi PR Limited (“Eskenzi”). As per the agreement, Eskenzi will provide various marketing and public relations services to the Company. The initial term of the agreement was for twelve months and automatically renews for an additional twelve months unless either the Company or Eskenzi provides at least three months advance written notice of termination. On January 16, 2021, the consulting agreement was automatically renewed per the terms of the agreement. Upon execution of the consulting agreement the Company was to issue 120,000 48,000 312,000 639,600 232,900 39,000 79,950 46,000 See Note 10 for disclosure of additional equity related transactions. |
StocK-BASED COMPENSATION
StocK-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2021 | |
Compensation Related Costs [Abstract] | |
StocK-BASED COMPENSATION | Note 10 – StocK-BASED COMPENSATION 2019 Equity Incentive Plan The Board of Directors and stockholders of the Company approved the Company’s 2019 Equity Incentive Plan (the “2019 Plan”) on June 6, 2019. The maximum number of shares of the Company’s common stock that may be issued under the Company’s 2019 Plan is 25,000,000 Options The Company granted options for the purchase of 3,236,340 The Company granted options for the purchase of 4,390,700 In applying the Black-Scholes option pricing model to stock options granted, the Company used the following assumptions: SCHEDULE OF BLACK-SCHOLES STOCK OPTIONS GRANTED For the Nine Months Ended For the Nine Months Ended September 30, 2021 September 30, 2020 Risk free interest rate 0.42% 0.86% 0.22% 0.33% Contractual term (years) 5.00 5.00 Expected volatility 73.43% 83.28% 73.61% 73.93% The total weighted average grant date fair value of options issued and vested during the nine months ended September 30, 2021, was $ 1,554,909 267,818 15,713,025 The total weighted average grant date fair value of options issued during the nine months ended September 30, 2020, was $ 157,384 1,871,528 Compensation-based stock option activity for qualified and unqualified stock options is summarized as follows: SCHEDULE OF STOCK OPTION ACTIVITY Weighted Average Shares Exercise Price Outstanding at January 1, 2021 24,573,700 $ 0.86 Granted 3,236,340 2.40 Exercised - - Expired or cancelled (130,000 ) 0.54 Outstanding at September 30, 2021 27,680,040 $ 1.04 The following table summarizes information about options to purchase shares of the Company’s common stock outstanding and exercisable at September 30, 2021: SUMMARY OF OPTIONS TO PURCHASE SHARES OF COMMON STOCK OUTSTANDING AND EXERCISABLE Weighted- Weighted- Average Average Outstanding Remaining Life Exercise Number Exercise Prices Options In Years Price Exercisable $ 0.38 3,000,000 2.87 $ 0.38 3,000,000 0.40 3,600,000 2.81 0.40 3,000,000 0.50 12,026,000 3.36 0.50 8,081,238 2.00 6,277,700 4.14 2.00 108,333 2.05 1,857,000 4.28 2.05 - 3.05 170,000 4.83 3.05 - 3.60 155,000 4.83 3.60 - 4.00 499,340 4.83 4.00 - $ 6.75 95,000 4.82 6.75 - 27,680,040 3.52 $ 1.03 14,189,571 The compensation expense attributed to the issuance of the options is recognized ratably over the vesting period. Options granted under the 2019 Plan are exercisable for a specified period, generally five to ten years from the grant date and generally vest over three to four years from the grant date. Total compensation expense related to the options was $ 1,251,635 392,661 2,981,523 1,062,000 12,863,247 2.58 The aggregate intrinsic value totaled $ 129,067,956 75,702,225 5.80 Options Pending As of September 30, 2021, the Company has approximately 3,400,000 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 11 – COMMITMENTS AND CONTINGENCIES Legal Claims There are no material pending legal proceedings in which the Company or any of its subsidiaries is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of its voting securities, or security holder is a party adverse to us or has a material interest adverse to the Company. |
LOANS PAYABLE AND LINES OF CRED
LOANS PAYABLE AND LINES OF CREDIT | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
LOANS PAYABLE AND LINES OF CREDIT | NOTE 12 – LOANS PAYABLE AND LINES OF CREDIT Lines of Credit TalaTek, Inc. On July 29, 2019, TalaTek entered into a secured line of credit with SunTrust Bank (“SunTrust”) for $ 500,000 2.25% Technologyville, Inc. On August 24, 2017, Techville entered into a secured revolving line of credit with Wintrust Bank (“Wintrust”) for a maximum amount of $ 75,000 1.99% 2% 6% August 24, 2021 221,346 224,346 - 3,000 Loans Payable Technologyville, Inc. On April 29, 2019, Techville entered into a note payable with VCI Account Services, that subsequently was assigned to U.S. Bancorp, in the original principal amount of $ 59,905 May 12, 2025 5.77% 8,580 8,054 526 37,826 On June 22, 2020, under the U.S. Small Business Administration’s Paycheck Protection Program, Techville entered into a note payable with a financial institution for $ 179,600 1% June 22, 2025 179,600 GenResults, LLC On December 31, 2018, GenResults entered into an unsecured note payable with Jemmett Enterprises, LLC, the Company’s majority stockholder that is controlled by the Company’s Chief Executive Officer, in the original principal amount of $ 200,000 June 15, 2021 6% 9,787 5,079 23,934 186 3,669 4,595 9,358 Cerberus Cyber Sentinel Corporation On April 17, 2020, under the U.S. Small Business Administration’s Paycheck Protection Program, Cerberus entered into a note payable with a financial institution for $ 530,000 1% April 17, 2022 530,000 Clear Skies Security LLC On May 8, 2020, under the U.S. Small Business Administration’s Paycheck Protection Program, Clear Skies entered into a loan payable with a financial institution for $ 134,200 1% May 8, 2022 134,200 Alpine Security, LLC On April 18, 2020, under the U.S. Small Business Administration’s Paycheck Protection Program, Alpine entered into a loan payable with a financial institution for $ 137,000 1% April 8, 2022 137,000 Catapult Acquisition Corp. On July 9, 2016, Catapult Acquistion Corp. entered into several seller notes payable with shareholders of VelocIT. The total borrowing amount was $ 600,000 5% July 31, 2023 150,000 600,000 559,354 Convertible Note Payable On December 23, 2020, the Company issued to a related party lender a convertible note payable in the principal amount of $ 3,000,000 . The convertible note bears interest at 6% per annum, with an effective interest rate, due to the if converted value of the note, of 8.5% per annum, payable at maturity with a maturity date of December 31, 2021. Amounts due under the note may be converted into shares of the Company’s common stock at any time at the option of the holder, at a conversion price of $ 2.00 per share. At December 31, 2020, the if converted value of the note, at the market price of $ 2.05 per share, would be $ 3,075,000 . The issuance of the note resulted in a discount from the beneficial conversion feature totaling $ 75,000 . Total straight-line amortization of this discount totaled $ 56,501 during the nine months ended September 30, 2021, and has a remaining amortization period of 0.25 years. Total interest expense on the note was $ 46,000 and $ 135,000 for the three and nine months ended September 30, 2021. Future minimum payments under the above notes payable for the remainder of 2021 and thereafter and the amount of loans payable, net of current portion, are as follows: SCHEDULE OF FUTURE PAYMENTS UNDER NOTES PAYABLE Sep. 30, 2021 2021 $ 3,000,000 2022 559,354 Total future minimum payments 3,559,354 Less: discount (18,599 ) Loans payable 3,540,755 Less: current (3,097,382 ) Loans payable, noncurrent $ 443,373 |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2021 | |
Leases | |
LEASES | NOTE 13 – LEASES All of the Company’s leases are classified as operating leases. With the adoption of Topic 842, operating lease agreements are required to be recognized on the condensed consolidated balance sheet as ROU assets and corresponding lease liabilities. On January 1, 2021, February 1, 2021, and August 12, 2021, the Company recognized additional ROU assets and lease liabilities of $ 37,932 , $ 137,826 and 154,767 , respectively. The Company elected to not recognize ROU assets and lease liabilities arising from office leases with initial terms of twelve months or less (deemed immaterial) on the unaudited condensed consolidated balance sheets. ROU assets include any prepaid lease payments and exclude any lease incentives and initial direct costs incurred. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The lease terms may include options to extend or terminate the lease if it is reasonably certain that the Company will exercise that option. When measuring lease liabilities for leases that were classified as operating leases, the Company discounted lease payments using its estimated incremental borrowing rate at January 1, 2021. The weighted average incremental borrowing rate applied was 6% 1.15 The following table presents net lease cost and other supplemental lease information: SCHEDULE OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION Nine Months Ended September 30, 2021 Lease cost Operating lease cost (cost resulting from lease payments) $ 80,251 Short term lease cost 29,329 Net lease cost $ 109,580 Operating lease – operating cash flows (fixed payments) $ 80,251 Operating lease – operating cash flows (liability reduction) $ 72,639 Non-current leases – right of use assets $ 268,096 Current liabilities – operating lease liabilities $ 166,709 Non-current liabilities – operating lease liabilities $ 107,899 Future minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases following the nine months ended September 30, 2021, are as follows: SCHEDULE OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES Sep. 30, 2021 Fiscal Year Operating Leases 2021 (excluding the nine months ended September 30, 2021) $ 44,638 2022 178,273 2023 66,738 Total future minimum lease payments 289,649 Amount representing interest (15,041 ) Present value of net future minimum lease payments $ 274,608 |
CONCENTRATION OF CREDIT RISK
CONCENTRATION OF CREDIT RISK | 9 Months Ended |
Sep. 30, 2021 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATION OF CREDIT RISK | NOTE 14 – CONCENTRATION OF CREDIT RISK Cash Deposits Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $ 250,000 1,788,000 4,252,000 SCHEDULES OF CONCENTRATION OF RISK, BY RISK FACTOR Revenues One client accounted for 26% Two clients accounted for 68% Client A 52 % Client B 16 % Accounts Receivable Two clients accounted for 27% Client A 15 % Client B 12 % Two clients accounted for 56% Client A 29 % Client B 27 % Accounts Payable Two vendors accounted for 21% Vendor A 11 % Vendor B 10 % Two vendors accounted for 40% Vendor A 26 % Vendor B 14 % |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 15 – SUBSEQUENT EVENTS Atlantic Technology Systems, Inc. Acquisition On October 1, 2021, the Company entered into a Stock Purchase Agreement (the “Agreement”) by and among the Company, Atlantic Technology Systems, Inc. (“ATS”) and Atlantic Technology Enterprises, Inc. (“ATE”) (collectively, “Atlantic”) and James Montagne, the sole shareholder of ATS, and James Montagne and Miriam Montagne as the sole shareholders of ATE (the “Shareholder”). Pursuant to the Agreement, the Company purchased from the Shareholder all of the outstanding shares of Atlantic, with ATE and ATS becoming wholly-owned subsidiaries of the Company. The aggregate purchase price for the Atlantic shares was 200,000 0.00001 75,000 100,000 150,000 Convertible Note Issuance On October 27, 2021, the Company issued a 5% Unsecured Convertible Note (the “Note”) to Neil Stinchcombe (the “Lender”), in consideration of the Lender lending the Company $ 1,500,000 January 27, 2022 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial information as of September 30, 2021, and for the three and nine months ended September 30, 2021 and 2020, has been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position at such dates and the operating results and cash flows for such periods. Operating results for the three and nine months ended September 30, 2021, are not necessarily indicative of the results that may be expected for the entire year or for any other subsequent interim period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission, or the SEC. These unaudited financial statements and related notes should be read in conjunction with our audited financial statements for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2021. |
Consolidation | Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, GenResults, LLC (“GenResults”), TalaTek, Inc. (“TalaTek”), Techville, Clear Skies, Alpine, and VelocIT. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Reclassifications | Reclassifications Certain reclassifications have been made to the financial statements for the three and nine months ended September 30, 2020, to conform to the financial statements presentation for the three and nine months ended September 30, 2021. These reclassifications had no effect on net loss or cash flows as previously reported. |
Use of Estimates | Use of Estimates Preparing financial statements in conformity with GAAP 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company believes the critical accounting policies discussed below affect its more significant judgments and estimates used in the preparation of the accompanying unaudited condensed consolidated financial statements. Significant estimates include the allowance for doubtful accounts, the carrying value of intangible assets and goodwill, deferred tax asset and valuation allowance, the estimated fair value of assets acquired, liabilities assumed and stock issued in business combinations and assumptions used in the Black-Scholes option pricing model, such as expected volatility, risk-free interest rate, and expected divided rate. |
Revenue | Revenue The Company’s revenues are derived from two major types of services to clients: Managed Services and Consulting Services. With respect to Managed Services, the Company provides culture education and enablement, tools and technology provisioning, data and privacy monitoring, regulations and compliance monitoring, remote infrastructure administration, and cybersecurity services including, but not limited to, antivirus and patch management. With respect to Consulting Services, the Company provides cybersecurity consulting, compliance auditing, vulnerability assessment and penetration testing, and disaster recovery and data backup solutions. Practical Expedients As part of Accounting Standards Codification (“ASC”) 606, the Company has adopted several practical expedients including the following: (i) the Company has determined that it need not adjust the promised amount of consideration for the effects of a significant financing component since the Company expects, at contract inception, that the period between when the Company transfers a promised service to the customer and when the customer pays for that service will be one year or less and (ii) the Company recognizes any incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. Disaggregated Revenues Revenue consists of the following by service offering for the nine months ended September 30, 2021: SCHEDULE OF DISAGGREGATION OF REVENUES Security Managed Services Professional Services Total Primary Sector Markets Public $ 3,179,047 $ 44,579 $ 3,223,626 Private 3,607,146 2,178,545 5,785,691 Not-for-Profit 192,953 52,313 245,266 $ 6,979,146 $ 2,275,437 $ 9,254,583 Major Service Lines Compliance $ 3,336,795 $ - $ 3,336,795 Secured Managed Services 3,134,269 - 3,134,269 SOC Managed Services 352,535 - 352,535 vCISO 155,547 - 155,547 Technical Assessments - 1,844,496 1,844,496 Forensics & I/R - 265,567 265,567 Training - 149,529 149,529 Other CyberSecurity Services - 15,845 15,845 $ 6,979,146 $ 2,275,437 $ 9,254,583 Revenue consists of the following by service offering for the nine months ended September 30, 2020: Security Managed Services Professional Services Total Primary Sector Markets Public $ 2,498,371 $ 5,068 $ 2,503,439 Private 1,024,744 1,001,748 2,026,492 Not-for-Profit 89,374 9,000 98,374 $ 3,612,489 $ 1,015,816 $ 4,628,305 Major Service Lines Compliance $ 2,519,958 $ - $ 2,519,958 Secured Managed Services 752,371 - 752,371 SOC Managed Services 301,760 - 301,760 vCISO 38,400 - 38,400 Technical Assessments - 190,825 190,825 Forensics & I/R - 554,069 554,069 Training - 58,625 58,625 Other CyberSecurity Services - 212,297 212,297 $ 3,612,489 $ 1,015,816 $ 4,628,305 |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. |
Accounts Receivable | Accounts Receivable Accounts receivable are reported at their outstanding unpaid principal balances, net of allowances for doubtful accounts. The Company periodically assesses its accounts and other receivables for collectability on a specific identification basis. The Company provides for allowances for doubtful receivables based on management’s estimate of uncollectible amounts considering age, collection history, and any other factors considered appropriate. Payments are generally due within 30 days of invoice. The Company writes off accounts receivable against the allowance for doubtful accounts when a balance is determined to be uncollectible. As of September 30, 2021, and December 31, 2020, the Company’s allowance for doubtful accounts was $ 76,200 and $ 40,000 , respectively. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, generally between three and five years. Expenditures that enhance the useful lives of the assets are capitalized and depreciated. Computer equipment costs for the Company are capitalized, as incurred, and depreciated on a straight-line basis over three years. TalaTek capitalizes all equipment costs over $ 5,000 Maintenance and repairs are charged to expense as incurred. At the time of retirement or other disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and the resulting gain or loss, if any, is reflected in results of operations. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets, including finite-lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of these assets is determined by comparing the forecasted undiscounted net cash flows of the operation to which the assets relate to the carrying amount. If the operation is determined to be unable to recover the carrying amount of its assets, then these assets are written down first, followed by other long-lived assets of the operation, to fair value. Fair value is determined based on discounted cash flows or appraised values, depending on the nature of the assets. During the three and nine months ended September 30, 2021, the Company did not record a loss on impairment. |
Intangible Assets | Intangible Assets The Company records its intangible assets at cost in accordance with ASC 350, Intangibles – Goodwill and Other |
Goodwill | Goodwill Goodwill represents the excess of the purchase price of the acquired business over the estimated fair value of the identifiable net assets acquired. Goodwill is not amortized but is tested for impairment at least annually at year end, at the reporting unit level or more frequently if events or changes in circumstances indicate that the asset might be impaired. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the reporting unit’s carrying value is compared to its fair value. The fair values of the reporting units are estimated using market and discounted cash flow approaches. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. The discounted cash flow approach uses expected future operating results. Failure to achieve these expected results may cause a future impairment of goodwill at the reporting unit level (See Note 6). |
Advertising and Marketing Costs | Advertising and Marketing Costs The Company expenses advertising and marketing costs as they are incurred. Advertising and marketing expenses were $ 254,026 30,488 471,721 104,058 |
Fair Value Measurements | Fair Value Measurements As defined in ASC 820, Fair Value Measurements and Disclosures Level 1: Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Level 2: Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reported date. Level 3: Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. The significant unobservable inputs used in the fair value measurement for nonrecurring fair value measurements of long-lived assets include pricing models, discounted cash flow methodologies and similar techniques. |
Net Loss per Common Share | Net Loss per Common Share Net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. All vested outstanding options are considered potentially outstanding common stock. The dilutive effect, if any, of stock options is calculated using the treasury stock method. All outstanding convertible notes are considered common stock at the beginning of the period or at the time of issuance, if later, pursuant to the if-converted method. Since the effect of common stock equivalents is anti-dilutive with respect to losses, the options have been excluded from the Company’s computation of net loss per common share for the three and nine months ended September 30, 2021 and 2020. The following tables summarize the securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive due to the Company’s net loss position even though the exercise price could be less than the average market price of the common shares: SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE CALCULATION September 30, 2021 September 30, 2020 Stock Options 27,680,040 21,435,700 Convertible Debt 1,500,000 - Total 29,180,040 21,435,700 |
Stock-based Compensation | Stock-based Compensation The Company applies the provisions of ASC 718, Compensation - Stock Compensation For stock options issued to employees and members of the board of directors for their services, the Company estimates the grant date fair value of each option using the Black-Scholes option pricing model. The use of the Black-Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk-free interest rates and expected dividend yields of the common stock. For awards subject to service-based vesting conditions, including those with a graded vesting schedule, the Company recognizes stock-based compensation expense equal to the grant date fair value of stock options on a straight-line basis over the requisite service period, which is generally the vesting term. Forfeitures are recorded as they are incurred as opposed to being estimated at the time of grant and revised. Due to the Company’s limited history and lack of public trading volume for its common stock, the Company used the average of historical share prices of similar companies within its industry to calculate volatility for use in the Black-Scholes option pricing model. Pursuant to Accounting Standards Update (“ASU”) 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Non-employee Share-Based Payment Accounting |
Leases | Leases Leases in which the Company is the lessee are comprised of corporate offices and property and equipment. All of the leases are classified as operating leases. The Company leases multiple office spaces with a remaining weighted average term of 1.17 0.67 In accordance with ASC 842, Leases |
Income Taxes | Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities, including tax loss and credit carry forwards, are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company utilizes ASC 740, Income Taxes For uncertain tax positions that meet a “more likely than not” threshold, the Company recognizes the benefit of uncertain tax positions in the unaudited condensed consolidated financial statements. The Company’s practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the unaudited condensed consolidated statements of operations when a determination is made that such expense is likely. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In March 2021, the FASB issued ASU No. 2021-03, Intangibles – Goodwill and Other (Topic 350). ASU 2021-03 requires an entity to identify and evaluate goodwill impairment triggering events when they occur to determine whether it is more likely than not that the fair value of a reporting unit (or entity, if the entity has elected the accounting alternative for amortizing goodwill and chosen that option) is less than its carrying amount. If an entity determines that it is more likely than not that the goodwill is impaired. It must test goodwill for impairment using the triggering event date as the measurement date. An entity is required to disclose the amount assigned to goodwill in total and by major business combination, or by reorganization event resulting in fresh-start reporting. Also, the entity must disclose the weighted average amortization period in total and the amortization period by major business combination, or by reorganization event resulting in fresh-start reporting. ASU 2021-03 was effective for the Company on January 1, 2021 and did not have a significant impact on our unaudited condensed consolidated financial statements. In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt — Modifications and Extinguishments (Subtopic 470-50), Compensation — Stock Compensation (Topic 718), and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the Emerging Issues Task Force). The ASU requires issuers to account for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after the modification or exchange based on the economic substance of the modification or exchange. Under the ASU, an issuer determines the accounting for the modification or exchange based on whether the transaction was done to issue equity, to issue or modify debt, or for other reasons. The ASU is applied prospectively and is effective for the Company for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact that adopting this standard will have on the unaudited condensed consolidated financial statements. All newly issued but not yet effective accounting pronouncements have been deemed to be not applicable or immaterial to the Company. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
SCHEDULE OF DISAGGREGATION OF REVENUES | Revenue consists of the following by service offering for the nine months ended September 30, 2021: SCHEDULE OF DISAGGREGATION OF REVENUES Security Managed Services Professional Services Total Primary Sector Markets Public $ 3,179,047 $ 44,579 $ 3,223,626 Private 3,607,146 2,178,545 5,785,691 Not-for-Profit 192,953 52,313 245,266 $ 6,979,146 $ 2,275,437 $ 9,254,583 Major Service Lines Compliance $ 3,336,795 $ - $ 3,336,795 Secured Managed Services 3,134,269 - 3,134,269 SOC Managed Services 352,535 - 352,535 vCISO 155,547 - 155,547 Technical Assessments - 1,844,496 1,844,496 Forensics & I/R - 265,567 265,567 Training - 149,529 149,529 Other CyberSecurity Services - 15,845 15,845 $ 6,979,146 $ 2,275,437 $ 9,254,583 Revenue consists of the following by service offering for the nine months ended September 30, 2020: Security Managed Services Professional Services Total Primary Sector Markets Public $ 2,498,371 $ 5,068 $ 2,503,439 Private 1,024,744 1,001,748 2,026,492 Not-for-Profit 89,374 9,000 98,374 $ 3,612,489 $ 1,015,816 $ 4,628,305 Major Service Lines Compliance $ 2,519,958 $ - $ 2,519,958 Secured Managed Services 752,371 - 752,371 SOC Managed Services 301,760 - 301,760 vCISO 38,400 - 38,400 Technical Assessments - 190,825 190,825 Forensics & I/R - 554,069 554,069 Training - 58,625 58,625 Other CyberSecurity Services - 212,297 212,297 $ 3,612,489 $ 1,015,816 $ 4,628,305 |
SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE CALCULATION | SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE CALCULATION September 30, 2021 September 30, 2020 Stock Options 27,680,040 21,435,700 Convertible Debt 1,500,000 - Total 29,180,040 21,435,700 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
SUMMARY OF SIGNIFICANT FAIR VALUE ASSETS ACQUIRED AND LIABILITIES | SUMMARY OF SIGNIFICANT FAIR VALUE ASSETS ACQUIRED AND LIABILITIES August 12,2021 Consideration paid $ 15,400,668 Tangible assets acquired: Cash 662,176 Accounts receivable 961,581 Prepaid expenses 37,941 Property and equipment 24,608 Capitalizable expenses 5,091 Total tangible assets 1,691,397 Intangible assets acquired: Intellectual property 134,445 Total intangible assets 134,445 Assumed liabilities: Accounts payable 528,571 Accrued expenses 222,095 Loans payable 1,071,313 SBA loan payoff 1,426,850 Total assumed liabilities 3,248,829 Net liabilities assumed (1,422,987 ) Goodwill (a.)(b.) $ 16,823,655 a. Goodwill is the excess of the purchase price over the fair value of the underlying net tangible and identifiable intangible assets. In accordance with applicable accounting standards, goodwill is not amortized but instead is tested for impairment at least annually or more frequently if certain indicators are present. Goodwill and intangibles are not deductible for tax purposes. b. Goodwill represents expected synergies from the merger of operations and intangible assets that do not qualify for separate recognition. Cerberus and VelocIT are both cybersecurity service providers. The acquisition of VelocIT provided Cerberus potential sales synergies resulting from Cerberus’ access to VelocIT’s current client-base to offer additional services. These items will be assigned a fair value upon the completion of the third-party valuation and are not expected to change significantly. |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS | Prepaid expenses and other current assets consist of: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS September 30, 2021 December 31, 2020 Prepaid expenses $ 398,712 $ 128,398 Prepaid insurance 56,125 13,746 Other current assets 30,780 - Total prepaid expenses and other current assets $ 485,617 $ 142,144 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY AND EQUIPMENT | Property and equipment consists of the following: SCHEDULE OF PROPERTY AND EQUIPMENT September 30, 2021 December 31, 2020 Computer equipment $ 15,735 $ 15,735 Vehicle 63,052 63,052 Furniture and fixtures 30,832 6,224 Software 10,092 10,092 Property and equipment, gross 119,711 95,103 Less: accumulated depreciation (30,310 ) (14,473 ) Property and equipment, net $ 89,401 $ 80,630 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF CHANGES IN GOODWILL | The following table summarizes the changes in goodwill during the nine months ended September 30, 2021: SCHEDULE OF CHANGES IN GOODWILL Balance December 31, 2020 $ 4,101,369 Acquisition of goodwill 16,823,655 Impairment - Reclassification based on valuation report (1) (230,000 ) Ending balance, September 30, 2021 (2) $ 20,695,024 (1) Subsequent to September 30, 2021, the Company obtained a third-party valuation for the December 16, 2020, acquisition of Alpine. As such, the purchase price allocation disclosed in the Company’s Annual Report in Form 10-K for December 31, 2020, filed on March 31, 2021, changed and, therefore, goodwill changed. (2) As of September 30, 2021, the Company had not obtained a third-party valuation for the August 12, 2021, acquisition of VelocIT. As such, the purchase price allocation disclosed in this Quarterly Report for September 30, 2021, may change and, therefore, goodwill from the acquisition may change. |
SUMMARY OF IDENTIFIABLE INTANGIBLE ASSETS | The following table summarizes the identifiable intangible assets as of September 30, 2021, and December 31, 2020: SUMMARY OF IDENTIFIABLE INTANGIBLE ASSETS Useful life September 30, 2021 December 31, 2020 Tradenames – trademarks (1) Indefinite $ 1,211,800 $ 1,094,500 Customer base (1) 15 384,000 370,000 Non-compete agreements (1) 5 242,100 236,400 Intellectual property/technology (1) 10 748,466 521,000 Identifiable intangible assets 2,586,366 2,221,900 Less accumulated amortization (226,964 ) (116,468 ) Total $ 2,359,402 $ 2,105,432 (1) These intangible assets were acquired in the acquisitions of TalaTek, Techville, Clear Skies, Alpine and VelocIT. |
SCHEDULE OF FUTURE AMORTIZATION EXPENSE | The below table summarizes the future amortization expense for the remainder of 2021 and the next four years thereafter: SCHEDULE OF FUTURE AMORTIZATION EXPENSE 2 2021 Remainder of 2021 $ 51,709 2022 153,554 2023 125,086 2024 127,939 2025 100,444 Thereafter 588,869 Future Amortization Expense $ 1,147,602 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES | Accounts payable and accrued expenses consist of the following amounts: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES September 30, 2021 December 31, 2020 Accounts payable $ 788,268 $ 328,368 Accrued payroll 408,602 39,670 Accrued expenses 265,532 417,832 Accrued commissions 26,678 - Accrued interest – related party 5,079 23,934 Total accounts payable and accrued expenses $ 1,494,159 $ 809,804 |
StocK-BASED COMPENSATION (Table
StocK-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Compensation Related Costs [Abstract] | |
SCHEDULE OF BLACK-SCHOLES STOCK OPTIONS GRANTED | In applying the Black-Scholes option pricing model to stock options granted, the Company used the following assumptions: SCHEDULE OF BLACK-SCHOLES STOCK OPTIONS GRANTED For the Nine Months Ended For the Nine Months Ended September 30, 2021 September 30, 2020 Risk free interest rate 0.42% 0.86% 0.22% 0.33% Contractual term (years) 5.00 5.00 Expected volatility 73.43% 83.28% 73.61% 73.93% |
SCHEDULE OF STOCK OPTION ACTIVITY | Compensation-based stock option activity for qualified and unqualified stock options is summarized as follows: SCHEDULE OF STOCK OPTION ACTIVITY Weighted Average Shares Exercise Price Outstanding at January 1, 2021 24,573,700 $ 0.86 Granted 3,236,340 2.40 Exercised - - Expired or cancelled (130,000 ) 0.54 Outstanding at September 30, 2021 27,680,040 $ 1.04 |
SUMMARY OF OPTIONS TO PURCHASE SHARES OF COMMON STOCK OUTSTANDING AND EXERCISABLE | The following table summarizes information about options to purchase shares of the Company’s common stock outstanding and exercisable at September 30, 2021: SUMMARY OF OPTIONS TO PURCHASE SHARES OF COMMON STOCK OUTSTANDING AND EXERCISABLE Weighted- Weighted- Average Average Outstanding Remaining Life Exercise Number Exercise Prices Options In Years Price Exercisable $ 0.38 3,000,000 2.87 $ 0.38 3,000,000 0.40 3,600,000 2.81 0.40 3,000,000 0.50 12,026,000 3.36 0.50 8,081,238 2.00 6,277,700 4.14 2.00 108,333 2.05 1,857,000 4.28 2.05 - 3.05 170,000 4.83 3.05 - 3.60 155,000 4.83 3.60 - 4.00 499,340 4.83 4.00 - $ 6.75 95,000 4.82 6.75 - 27,680,040 3.52 $ 1.03 14,189,571 |
LOANS PAYABLE AND LINES OF CR_2
LOANS PAYABLE AND LINES OF CREDIT (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF FUTURE PAYMENTS UNDER NOTES PAYABLE | Future minimum payments under the above notes payable for the remainder of 2021 and thereafter and the amount of loans payable, net of current portion, are as follows: SCHEDULE OF FUTURE PAYMENTS UNDER NOTES PAYABLE Sep. 30, 2021 2021 $ 3,000,000 2022 559,354 Total future minimum payments 3,559,354 Less: discount (18,599 ) Loans payable 3,540,755 Less: current (3,097,382 ) Loans payable, noncurrent $ 443,373 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases | |
SCHEDULE OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION | The following table presents net lease cost and other supplemental lease information: SCHEDULE OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION Nine Months Ended September 30, 2021 Lease cost Operating lease cost (cost resulting from lease payments) $ 80,251 Short term lease cost 29,329 Net lease cost $ 109,580 Operating lease – operating cash flows (fixed payments) $ 80,251 Operating lease – operating cash flows (liability reduction) $ 72,639 Non-current leases – right of use assets $ 268,096 Current liabilities – operating lease liabilities $ 166,709 Non-current liabilities – operating lease liabilities $ 107,899 |
SCHEDULE OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES | Future minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases following the nine months ended September 30, 2021, are as follows: SCHEDULE OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES Sep. 30, 2021 Fiscal Year Operating Leases 2021 (excluding the nine months ended September 30, 2021) $ 44,638 2022 178,273 2023 66,738 Total future minimum lease payments 289,649 Amount representing interest (15,041 ) Present value of net future minimum lease payments $ 274,608 |
CONCENTRATION OF CREDIT RISK (T
CONCENTRATION OF CREDIT RISK (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Risks and Uncertainties [Abstract] | |
SCHEDULES OF CONCENTRATION OF RISK, BY RISK FACTOR | SCHEDULES OF CONCENTRATION OF RISK, BY RISK FACTOR Revenues One client accounted for 26% Two clients accounted for 68% Client A 52 % Client B 16 % Accounts Receivable Two clients accounted for 27% Client A 15 % Client B 12 % Two clients accounted for 56% Client A 29 % Client B 27 % Accounts Payable Two vendors accounted for 21% Vendor A 11 % Vendor B 10 % Two vendors accounted for 40% Vendor A 26 % Vendor B 14 % |
NATURE OF THE ORGANIZATION AN_2
NATURE OF THE ORGANIZATION AND BUSINESS (Details Narrative) - USD ($) | Aug. 12, 2021 | Dec. 16, 2020 | Aug. 01, 2020 | May 25, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Retained Earnings (Accumulated Deficit) | $ 11,013,392 | $ 11,013,392 | $ 4,866,772 | ||||||
Working capital | 646,000 | 646,000 | |||||||
Operating Income (Loss) | $ 3,158,398 | $ 1,030,383 | 6,920,167 | $ 2,418,912 | |||||
Net Cash Provided by (Used in) Operating Activities | 4,312,312 | $ 1,157,976 | |||||||
U S Small Business Administrations Payroll Protection Program [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Proceeds from issuance of private placement | $ 3,250,000 | ||||||||
Stock Purchase Agreement [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Number of shares converted | 2,566,778 | ||||||||
Stock Purchase Agreement [Member] | Alpine Security L L C [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Number of shares converted | 900,000 | ||||||||
Stock Purchase Agreement [Member] | Technologyville Inc [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Number of shares converted | 3,392,271 | ||||||||
Share Purchase Agreement [Member] | Clear Skies Security L L C [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Number of shares converted | 2,330,000 |
SCHEDULE OF DISAGGREGATION OF R
SCHEDULE OF DISAGGREGATION OF REVENUES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Product Information [Line Items] | ||||
Primary Sector Markets - Public | $ 3,223,626 | $ 2,503,439 | ||
Primary Sector Markets - Private | 5,785,691 | 2,026,492 | ||
Primary Sector Markets - Not-for-Profit | 245,266 | 98,374 | ||
Total Primary Sector Markets | 9,254,583 | 4,628,305 | ||
Major Service Lines - Compliance | 3,336,795 | 2,519,958 | ||
Major Service Lines - Secured Managed Services | 3,134,269 | 752,371 | ||
Major Service Lines - SOC Managed Services | 352,535 | 301,760 | ||
Major Service Lines - vCisco | 155,547 | 38,400 | ||
Major Service Lines - Technical Assessments | 1,844,496 | 190,825 | ||
Major Service Lines - Forensics & I/R | 265,567 | 554,069 | ||
Major Service Lines - Training | 149,529 | 58,625 | ||
Major Service Lines - Other CyberSecurity Services | 15,845 | 212,297 | ||
Revenue | $ 3,745,008 | $ 2,009,598 | 9,254,583 | 4,628,305 |
Security Managed Services [Member] | ||||
Product Information [Line Items] | ||||
Primary Sector Markets - Public | 3,179,047 | 2,498,371 | ||
Primary Sector Markets - Private | 3,607,146 | 1,024,744 | ||
Primary Sector Markets - Not-for-Profit | 192,953 | 89,374 | ||
Total Primary Sector Markets | 6,979,146 | 3,612,489 | ||
Major Service Lines - Compliance | 3,336,795 | 2,519,958 | ||
Major Service Lines - Secured Managed Services | 3,134,269 | 752,371 | ||
Major Service Lines - SOC Managed Services | 352,535 | 301,760 | ||
Major Service Lines - vCisco | 155,547 | 38,400 | ||
Major Service Lines - Technical Assessments | ||||
Major Service Lines - Forensics & I/R | ||||
Major Service Lines - Training | ||||
Major Service Lines - Other CyberSecurity Services | ||||
Revenue | 3,099,753 | 1,683,733 | 6,979,146 | 3,612,489 |
Professional Services [Member] | ||||
Product Information [Line Items] | ||||
Primary Sector Markets - Public | 44,579 | 5,068 | ||
Primary Sector Markets - Private | 2,178,545 | 1,001,748 | ||
Primary Sector Markets - Not-for-Profit | 52,313 | 9,000 | ||
Total Primary Sector Markets | 2,275,437 | 1,015,816 | ||
Major Service Lines - Compliance | ||||
Major Service Lines - Secured Managed Services | ||||
Major Service Lines - SOC Managed Services | ||||
Major Service Lines - vCisco | ||||
Major Service Lines - Technical Assessments | 1,844,496 | 190,825 | ||
Major Service Lines - Forensics & I/R | 265,567 | 554,069 | ||
Major Service Lines - Training | 149,529 | 58,625 | ||
Major Service Lines - Other CyberSecurity Services | 15,845 | 212,297 | ||
Revenue | $ 645,255 | $ 325,865 | $ 2,275,437 | $ 1,015,816 |
SUMMARY OF SECURITIES EXCLUDED
SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE CALCULATION (Details) - shares | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from the diluted per share calculation | 29,180,040 | 21,435,700 |
Share-based Payment Arrangement, Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from the diluted per share calculation | 27,680,040 | 21,435,700 |
Convertible Debt [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from the diluted per share calculation | 1,500,000 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation [Line Items] | |||||
Accounts Receivable, Allowance for Credit Loss, Current | $ 76,200 | $ 76,200 | $ 40,000 | ||
Capitalized costs | 5,000 | 5,000 | |||
Marketing and Advertising Expense | $ 254,026 | $ 30,488 | $ 471,721 | $ 104,058 | |
Operating lease, weighted average remaining lease term | 1 year 1 month 24 days | 1 year 1 month 24 days | |||
Office Building [Member] | |||||
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation [Line Items] | |||||
Operating lease, weighted average remaining lease term | 1 year 2 months 1 day | 1 year 2 months 1 day | |||
Vehicle [Member] | |||||
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation [Line Items] | |||||
Operating lease, weighted average remaining lease term | 8 months 1 day | 8 months 1 day |
SUMMARY OF SIGNIFICANT FAIR VAL
SUMMARY OF SIGNIFICANT FAIR VALUE ASSETS ACQUIRED AND LIABILITIES (Details) - USD ($) | Sep. 30, 2021 | [1] | Aug. 12, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||||
Goodwill (a.)(b.) | $ 20,695,024 | $ 4,101,369 | |||
Veloc I T [Member] | |||||
Business Acquisition [Line Items] | |||||
Consideration paid | $ 15,400,668 | ||||
Cash | 662,176 | ||||
Accounts receivable | 961,581 | ||||
Prepaid expenses | 37,941 | ||||
Property and equipment | 24,608 | ||||
Capitalizable expenses | 5,091 | ||||
Total tangible assets | 1,691,397 | ||||
Intellectual property | 134,445 | ||||
Total intangible assets | 134,445 | ||||
Accounts payable | 528,571 | ||||
Accrued expenses | 222,095 | ||||
Loans payable | 1,071,313 | ||||
SBA loan payoff | 1,426,850 | ||||
Total assumed liabilities | 3,248,829 | ||||
Net liabilities assumed | (1,422,987) | ||||
Goodwill (a.)(b.) | [2],[3] | $ 16,823,655 | |||
[1] | As of September 30, 2021, the Company had not obtained a third-party valuation for the August 12, 2021, acquisition of VelocIT. As such, the purchase price allocation disclosed in this Quarterly Report for September 30, 2021, may change and, therefore, goodwill from the acquisition may change. | ||||
[2] | Goodwill is the excess of the purchase price over the fair value of the underlying net tangible and identifiable intangible assets. In accordance with applicable accounting standards, goodwill is not amortized but instead is tested for impairment at least annually or more frequently if certain indicators are present. Goodwill and intangibles are not deductible for tax purposes. | ||||
[3] | Goodwill represents expected synergies from the merger of operations and intangible assets that do not qualify for separate recognition. Cerberus and VelocIT are both cybersecurity service providers. The acquisition of VelocIT provided Cerberus potential sales synergies resulting from Cerberus’ access to VelocIT’s current client-base to offer additional services. These items will be assigned a fair value upon the completion of the third-party valuation and are not expected to change significantly. |
ACQUISITIONS (Details Narrative
ACQUISITIONS (Details Narrative) - USD ($) | Aug. 12, 2021 | Aug. 12, 2021 | Sep. 30, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||||||||||||
Common stock, shares issued | 120,529,649 | 120,529,649 | 120,529,649 | 116,104,971 | ||||||||
Common stock, shares outstanding | 120,529,649 | 120,529,649 | 120,529,649 | 116,104,971 | ||||||||
Ownership percentage | 98.00% | 98.00% | ||||||||||
Business acquisitions net income loss | $ (2,252,899) | $ (2,116,862) | $ (1,776,859) | $ (1,035,199) | $ (546,103) | $ (839,144) | $ (6,146,620) | $ (2,420,446) | ||||
Veloc I T Acquisition [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Common stock, shares issued | 120,296,749 | 120,296,749 | ||||||||||
Common stock, shares outstanding | 120,296,749 | 120,296,749 | ||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 117,729,971 | |||||||||||
Business acquisition effective date of acquisition | Aug. 12, 2021 | |||||||||||
Veloc I T [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Business acquisitions revenue | $ 985,146 | |||||||||||
Business acquisitions net income loss | $ 1,695,276 | |||||||||||
Common Stock [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Acquisitions stock exchanged | 2,566,778 | 2,330,000 | 3,392,271 | |||||||||
Business acquisitions net income loss | ||||||||||||
Veloc I T Acquisition [Member] | Common Stock [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Acquisitions stock exchanged | 2,566,778 |
SCHEDULE OF PREPAID EXPENSES AN
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses | $ 398,712 | $ 128,398 |
Prepaid insurance | 56,125 | 13,746 |
Other current assets | 30,780 | |
Total prepaid expenses and other current assets | $ 485,617 | $ 142,144 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 119,711 | $ 95,103 |
Less: accumulated depreciation | (30,310) | (14,473) |
Property and equipment, net | 89,401 | 80,630 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 15,735 | 15,735 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 63,052 | 63,052 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 30,832 | 6,224 |
Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 10,092 | $ 10,092 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | ||||
Property and equipment, depreciation expense | $ 6,989 | $ 5,361 | $ 15,837 | $ 8,668 |
SCHEDULE OF CHANGES IN GOODWILL
SCHEDULE OF CHANGES IN GOODWILL (Details) | 9 Months Ended | |
Sep. 30, 2021USD ($) | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Balance beginning | $ 4,101,369 | |
Acquisition of goodwill | 16,823,655 | |
Impairment | ||
Reclassification based on valuation report | (230,000) | [1] |
Ending balance | $ 20,695,024 | [2] |
[1] | Subsequent to September 30, 2021, the Company obtained a third-party valuation for the December 16, 2020, acquisition of Alpine. As such, the purchase price allocation disclosed in the Company’s Annual Report in Form 10-K for December 31, 2020, filed on March 31, 2021, changed and, therefore, goodwill changed. | |
[2] | As of September 30, 2021, the Company had not obtained a third-party valuation for the August 12, 2021, acquisition of VelocIT. As such, the purchase price allocation disclosed in this Quarterly Report for September 30, 2021, may change and, therefore, goodwill from the acquisition may change. |
SUMMARY OF IDENTIFIABLE INTANGI
SUMMARY OF IDENTIFIABLE INTANGIBLE ASSETS (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2020 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Identifiable intangible assets | $ 2,586,366 | $ 2,221,900 | |
Identifiable intangible assets, useful life | 8 years 2 months 26 days | ||
Less accumulated amortization | $ (226,964) | (116,468) | |
Total | $ 2,359,402 | 2,105,432 | |
Tala Tek L L C [Member] | Trade Names [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Identifiable intangible assets, useful life description | [1] | Indefinite | |
Identifiable intangible assets | [1] | $ 1,211,800 | 1,094,500 |
Tala Tek L L C [Member] | Customerbase [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Identifiable intangible assets | [1] | $ 384,000 | 370,000 |
Identifiable intangible assets, useful life | [1] | 15 years | |
Tala Tek L L C [Member] | Noncompete Agreements [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Identifiable intangible assets | [1] | $ 242,100 | 236,400 |
Identifiable intangible assets, useful life | [1] | 5 years | |
Tala Tek L L C [Member] | Intellectual Property Technology [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Identifiable intangible assets | [1] | $ 748,466 | $ 521,000 |
Identifiable intangible assets, useful life | [1] | 10 years | |
[1] | These intangible assets were acquired in the acquisitions of TalaTek, Techville, Clear Skies, Alpine and VelocIT. |
SCHEDULE OF FUTURE AMORTIZATION
SCHEDULE OF FUTURE AMORTIZATION EXPENSE (Details) | Sep. 30, 2021USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of 2021 | $ 51,709 |
2022 | 153,554 |
2023 | 125,086 |
2024 | 127,939 |
2025 | 100,444 |
Thereafter | 588,869 |
Future Amortization Expense | $ 1,147,602 |
INTANGIBLE ASSETS AND GOODWIL_2
INTANGIBLE ASSETS AND GOODWILL (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Finite-Lived Intangible Asset, Useful Life | 8 years 2 months 26 days | |||
Amortization of identifiable intangible assets | $ 40,506 | $ 15,648 | $ 110,495 | $ 46,944 |
SCHEDULE OF ACCOUNTS PAYABLE AN
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 788,268 | $ 328,368 |
Accrued payroll | 408,602 | 39,670 |
Accrued expenses | 265,532 | 417,832 |
Accrued commissions | 26,678 | |
Accrued interest – related party | 5,079 | 23,934 |
Total accounts payable and accrued expenses | $ 1,494,159 | $ 809,804 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 23, 2020 | Dec. 31, 2018 | |
Debt Instrument, Increase, Accrued Interest | $ 5,079 | $ 23,934 | |||||
Interest Expense, Related Party | $ 186 | $ 3,669 | 4,595 | $ 9,358 | |||
Accounts receivable related parties | $ 48,270 | 48,270 | |||||
Revenues from transactions with related party | $ 305,127 | ||||||
Convertible Note Payable Related Party [Member] | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | ||||||
Debt instrument, face amount | $ 3,000,000 | $ 3,000,000 | $ 3,000,000 | $ 3,000,000 | |||
Jemmett Enterprises L L C [Member] | |||||||
Notes Payable | $ 200,000 | ||||||
Debt Instrument, Maturity Date | Jun. 15, 2021 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | ||||||
Loans Payable | $ 9,787 |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) | Aug. 16, 2021 | Aug. 12, 2021 | Jan. 16, 2020 | Sep. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Proceeds from issuance of common stock | $ 3,250,000 | $ 790,000 | |||||||||
Stock Issued During Period, Value, New Issues | $ 3,250,000 | $ 650,000 | $ 140,000 | ||||||||
Share issued for vesting | 39,000 | ||||||||||
Stock payable | $ 79,950 | $ 79,950 | $ 46,000 | ||||||||
Restricted Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of common shares issued | 312,000 | ||||||||||
Stock Issued During Period, Value, New Issues | $ 639,600 | ||||||||||
Common Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of common shares issued | 1,625,000 | 325,000 | 350,000 | ||||||||
Stock Issued During Period, Shares, Acquisitions | 2,566,778 | 2,330,000 | 3,392,271 | ||||||||
Stock Issued During Period, Value, New Issues | $ 16 | $ 3 | $ 4 | ||||||||
Common Stock [Member] | Consulting Agreement [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of common shares issued | 232,900 | ||||||||||
Veloc I T Acquisition [Member] | Common Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Shares issued fair value per share | $ 6 | ||||||||||
Stock Issued During Period, Shares, Acquisitions | 2,566,778 | ||||||||||
Eskenzi P R Limited [Member] | Restricted Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of common shares issued | 120,000 | ||||||||||
Stock Issued During Period, Value, New Issues | $ 48,000 | ||||||||||
Investors [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of common shares issued | 1,625,000 | ||||||||||
Shares issued fair value per share | $ 2 | $ 2 | |||||||||
Proceeds from issuance of common stock | $ 3,250,000 | ||||||||||
Consultant [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Shares issued fair value per share | $ 2.05 | ||||||||||
Stock Issued During Period, Shares, Issued for Services | 232,900 |
SCHEDULE OF BLACK-SCHOLES STOCK
SCHEDULE OF BLACK-SCHOLES STOCK OPTIONS GRANTED (Details) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Contractual term (years) | 5 years | 5 years |
Minimum [Member] | ||
Risk free interest rate | 0.42% | 0.22% |
Expected volatility | 73.43% | 73.61% |
Maximum [Member] | ||
Risk free interest rate | 0.86% | 0.33% |
Expected volatility | 83.28% | 73.93% |
SCHEDULE OF STOCK OPTION ACTIVI
SCHEDULE OF STOCK OPTION ACTIVITY (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Compensation Related Costs [Abstract] | |
Shares, Outstanding beginning | shares | 24,573,700 |
Weighted Average Exercise Price Outstanding, beginning | $ / shares | $ 0.86 |
Shares, Granted | shares | 3,236,340 |
Weighted Average Exercise Price, Granted | $ / shares | $ 2.40 |
Shares, Exercised | shares | |
Weighted Average Exercise Price, Exercised | $ / shares | |
Shares, Expired or cancelled | shares | (130,000) |
Weighted Average Exercise Price, Expired or cancelled | $ / shares | $ 0.54 |
Shares, Outstanding ending | shares | 27,680,040 |
Weighted Average Exercise Price Outstanding, ending | $ / shares | $ 1.04 |
SUMMARY OF OPTIONS TO PURCHASE
SUMMARY OF OPTIONS TO PURCHASE SHARES OF COMMON STOCK OUTSTANDING AND EXERCISABLE (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Outstanding Options | 27,680,040 |
Weighted-Average Remaining Life In Years | 3 years 6 months 7 days |
Weighted-Average Exercise Price | $ / shares | $ 1.03 |
Number Exercisable | 14,189,571 |
Exercise Price Range One [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 0.38 |
Outstanding Options | 3,000,000 |
Weighted-Average Remaining Life In Years | 2 years 10 months 13 days |
Weighted-Average Exercise Price | $ / shares | $ 0.38 |
Number Exercisable | 3,000,000 |
Exercise Price RangeTwo [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 0.40 |
Outstanding Options | 3,600,000 |
Weighted-Average Remaining Life In Years | 2 years 9 months 21 days |
Weighted-Average Exercise Price | $ / shares | $ 0.40 |
Number Exercisable | 3,000,000 |
Exercise Price RangeThree [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 0.50 |
Outstanding Options | 12,026,000 |
Weighted-Average Remaining Life In Years | 3 years 4 months 9 days |
Weighted-Average Exercise Price | $ / shares | $ 0.50 |
Number Exercisable | 8,081,238 |
Exercise Price Range Four [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 2 |
Outstanding Options | 6,277,700 |
Weighted-Average Remaining Life In Years | 4 years 1 month 20 days |
Weighted-Average Exercise Price | $ / shares | $ 2 |
Number Exercisable | 108,333 |
Exercise Price Range Five [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 2.05 |
Outstanding Options | 1,857,000 |
Weighted-Average Remaining Life In Years | 4 years 3 months 10 days |
Weighted-Average Exercise Price | $ / shares | $ 2.05 |
Number Exercisable | |
Exercise Price Range Six [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 3.05 |
Outstanding Options | 170,000 |
Weighted-Average Remaining Life In Years | 4 years 9 months 29 days |
Weighted-Average Exercise Price | $ / shares | $ 3.05 |
Number Exercisable | |
Exercise Price Range Seven [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 3.60 |
Outstanding Options | 155,000 |
Weighted-Average Remaining Life In Years | 4 years 9 months 29 days |
Weighted-Average Exercise Price | $ / shares | $ 3.60 |
Number Exercisable | |
Exercise Price Range Eight [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 4 |
Outstanding Options | 499,340 |
Weighted-Average Remaining Life In Years | 4 years 9 months 29 days |
Weighted-Average Exercise Price | $ / shares | $ 4 |
Number Exercisable | |
Exercise Price Range Nine [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of exercise prices | $ / shares | $ 6.75 |
Outstanding Options | 95,000 |
Weighted-Average Remaining Life In Years | 4 years 9 months 25 days |
Weighted-Average Exercise Price | $ / shares | $ 6.75 |
Number Exercisable |
StocK-BASED COMPENSATION (Detai
StocK-BASED COMPENSATION (Details Narrative) - USD ($) | Jun. 06, 2019 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Number of stock options granted | 3,236,340 | ||||
Aggregate instrinsic value, outstanding | $ 129,067,956 | $ 129,067,956 | |||
Aggregate instrinsic value, exercisable | $ 75,702,225 | $ 75,702,225 | |||
Estimated fair value of common stock | $ 5.80 | $ 5.80 | |||
Employee share based stock option | 3,400,000 | 3,400,000 | |||
Two Thousand Nineteen Equity Incentive Plan [Member] | |||||
Number of stock options granted | 3,236,340 | 4,390,700 | |||
Options granted, weighted average grant date fair value | $ 1,554,909 | $ 157,384 | |||
Options vested, weighted average grant date fair value | 267,818 | ||||
Employee Benefits and Share-based Compensation | $ 1,251,635 | $ 392,661 | 2,981,523 | 1,062,000 | |
Stock options future compensation cost | $ 12,863,247 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 2 years 6 months 29 days | ||||
Two Thousand Nineteen Equity Incentive Plan [Member] | Nonvested Options [Member] | |||||
Options vested, weighted average grant date fair value | $ 15,713,025 | $ 1,871,528 | |||
Two Thousand Nineteen Equity Incentive Plan [Member] | Maximum [Member] | |||||
Number of common shares issued | 25,000,000 |
SCHEDULE OF FUTURE PAYMENTS UND
SCHEDULE OF FUTURE PAYMENTS UNDER NOTES PAYABLE (Details) | Sep. 30, 2021USD ($) |
Debt Disclosure [Abstract] | |
2021 | $ 3,000,000 |
2022 | 559,354 |
Total future minimum payments | 3,559,354 |
Less: discount | (18,599) |
Loans payable | 3,540,755 |
Less: current | (3,097,382) |
Loans payable, noncurrent | $ 443,373 |
LOANS PAYABLE AND LINES OF CR_3
LOANS PAYABLE AND LINES OF CREDIT (Details Narrative) - USD ($) | Jun. 22, 2020 | May 08, 2020 | Apr. 18, 2020 | Apr. 17, 2020 | Jul. 29, 2019 | Apr. 29, 2019 | Dec. 31, 2018 | Aug. 24, 2017 | Jul. 09, 2016 | Sep. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 23, 2020 |
Debt Instrument [Line Items] | ||||||||||||||||
Proceeds from Lines of Credit | $ 221,346 | $ 60,000 | ||||||||||||||
Repayments of Lines of Credit | 224,346 | 93,705 | ||||||||||||||
Debt Instrument, Increase, Accrued Interest | 5,079 | $ 23,934 | ||||||||||||||
Amortization of Debt Discount (Premium) | 54,792 | |||||||||||||||
Unsecured Note Payable [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Notes Payable | $ 200,000 | 9,787 | ||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | |||||||||||||||
Debt Instrument, Maturity Date | Jun. 15, 2021 | |||||||||||||||
Debt Instrument, Increase, Accrued Interest | 5,079 | $ 23,934 | ||||||||||||||
Interest Expense, Debt | $ 186 | $ 3,669 | 4,595 | $ 9,358 | ||||||||||||
Convertible Note Payable [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | |||||||||||||||
Debt instrument face amount | $ 3,000,000 | |||||||||||||||
Interest Expense, Debt | 46,000 | 135,000 | ||||||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 8.50% | |||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ 2 | |||||||||||||||
Share Price | $ 2.05 | |||||||||||||||
Debt Conversion, Converted Instrument, Amount | $ 3,075,000 | |||||||||||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | 75,000 | |||||||||||||||
Amortization of Debt Discount (Premium) | $ 56,501 | |||||||||||||||
Debt Instrument, Convertible, Remaining Discount Amortization Period | 3 months | |||||||||||||||
Wintrust Bank [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.99% | |||||||||||||||
Debt Instrument, Maturity Date | Aug. 24, 2021 | |||||||||||||||
Wintrust Bank [Member] | Maximum [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Notes Payable | $ 75,000 | |||||||||||||||
Prime Rate [Member] | Wintrust Bank [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.00% | |||||||||||||||
Floor Rate [Member] | Wintrust Bank [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | |||||||||||||||
SunTrust Bank[Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Secured line of credit | $ 500,000 | |||||||||||||||
SunTrust Bank[Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Line of credit interest rate percentage | 2.25% | |||||||||||||||
Technologyville Inc [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Secured line of credit | $ 3,000 | |||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.77% | |||||||||||||||
Debt Instrument, Maturity Date | May 12, 2025 | |||||||||||||||
Proceeds from Lines of Credit | $ 221,346 | |||||||||||||||
Repayments of Lines of Credit | $ 224,346 | |||||||||||||||
Debt instrument face amount | $ 59,905 | 37,826 | 37,826 | |||||||||||||
Debt Instrument, Periodic Payment | 8,580 | |||||||||||||||
Debt Instrument, Periodic Payment, Principal | 8,054 | |||||||||||||||
Debt Instrument, Periodic Payment, Interest | 526 | |||||||||||||||
Technologyville Inc [Member] | U S Small Business Administrations Payroll Protection Program [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Notes Payable | $ 179,600 | |||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.00% | |||||||||||||||
Debt Instrument, Maturity Date | Jun. 22, 2025 | |||||||||||||||
Debt instrument face amount | 179,600 | 179,600 | ||||||||||||||
Cerberus Cyber Sentinel Corporation [Member] | U.S. Small Business Administration's Payroll Protection Program One [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Notes Payable | $ 530,000 | |||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.00% | |||||||||||||||
Debt Instrument, Maturity Date | Apr. 17, 2022 | |||||||||||||||
Loans payable, outstanding | 530,000 | 530,000 | ||||||||||||||
Clear Skies Security L L C [Member] | U.S. Small Business Administration's Payroll Protection Program Two [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Notes Payable | $ 134,200 | |||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.00% | |||||||||||||||
Debt Instrument, Maturity Date | May 8, 2022 | |||||||||||||||
Loans payable, outstanding | 134,200 | 134,200 | ||||||||||||||
Alpine Security L L C [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Notes Payable | $ 137,000 | |||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 1.00% | |||||||||||||||
Debt Instrument, Maturity Date | Apr. 8, 2022 | |||||||||||||||
Alpine Security L L C [Member] | Paycheck Protection Program [Member] | Principal Forgiveness [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Loans payable, outstanding | 137,000 | 137,000 | ||||||||||||||
Catapult Acquistion Corp [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Notes Payable | $ 600,000 | |||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | |||||||||||||||
Debt Instrument, Maturity Date | Jul. 31, 2023 | |||||||||||||||
Catapult Acquisition Corp [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt instrument face amount | $ 150,000 | |||||||||||||||
Debt Instrument, Increase, Accrued Interest | $ 600,000 | |||||||||||||||
Loans payable, outstanding | $ 559,354 | $ 559,354 |
SCHEDULE OF LEASE COST AND OTHE
SCHEDULE OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION (Details) - USD ($) | 9 Months Ended | ||||
Sep. 30, 2021 | Aug. 12, 2021 | Feb. 02, 2021 | Jan. 02, 2021 | Dec. 31, 2020 | |
Leases | |||||
Operating lease cost (cost resulting from lease payments) | $ 80,251 | ||||
Short term lease cost | 29,329 | ||||
Net lease cost | 109,580 | ||||
Operating lease – operating cash flows (fixed payments) | 80,251 | ||||
Operating lease – operating cash flows (liability reduction) | 72,639 | ||||
Non-current leases - right of use assets | 268,096 | $ 13,426 | |||
Current liabilities - operating lease liabilities | 166,709 | $ 154,767 | $ 137,826 | $ 37,932 | 8,989 |
Non-current liabilities - operating lease liabilities | $ 107,899 | $ 4,693 |
SCHEDULE OF FUTURE MINIMUM UNDE
SCHEDULE OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES (Details) | Sep. 30, 2021USD ($) |
Leases | |
2021 (excluding the nine months ended September 30, 2021) | $ 44,638 |
2022 | 178,273 |
2023 | 66,738 |
Total future minimum lease payments | 289,649 |
Amount representing interest | (15,041) |
Present value of net future minimum lease payments | $ 274,608 |
LEASES (Details Narrative)
LEASES (Details Narrative) - USD ($) | Sep. 30, 2021 | Aug. 12, 2021 | Feb. 02, 2021 | Jan. 02, 2021 | Dec. 31, 2020 |
Leases | |||||
Operating Lease, Liability, Current | $ 166,709 | $ 154,767 | $ 137,826 | $ 37,932 | $ 8,989 |
Weighted average incremental borrowing rate | 6.00% | ||||
Operating lease, weighted average remaining lease term | 1 year 1 month 24 days |
SCHEDULES OF CONCENTRATION OF R
SCHEDULES OF CONCENTRATION OF RISK, BY RISK FACTOR (Details) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Client A [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 52.00% | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Client B [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 16.00% | |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Client A [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 15.00% | 29.00% |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Client B [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 12.00% | 27.00% |
Accounts Payable [Member] | Supplier Concentration Risk [Member] | Vendor A [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 11.00% | 26.00% |
Accounts Payable [Member] | Supplier Concentration Risk [Member] | Vendor B [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 10.00% | 14.00% |
CONCENTRATION OF CREDIT RISK (D
CONCENTRATION OF CREDIT RISK (Details Narrative) - USD ($) | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Concentration Risk [Line Items] | |||
Deposits in excess of the FDIC insured | $ 1,788,000 | $ 4,252,000 | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | One Client [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 26.00% | ||
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Two Clients [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 68.00% | ||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Two Clients [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 56.00% | ||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Two Client [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 27.00% | ||
Accounts Payable [Member] | Supplier Concentration Risk [Member] | Two Vendors [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 21.00% | ||
Accounts Payable [Member] | Supplier Concentration Risk [Member] | Two Vendor [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 40.00% | ||
Maximum [Member] | |||
Concentration Risk [Line Items] | |||
FDIC insured, value | $ 250,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Oct. 27, 2021 | Oct. 02, 2021 | Oct. 02, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Mar. 31, 2020 |
Subsequent Event [Line Items] | ||||||
Number of shares issued value | $ 3,250,000 | $ 650,000 | $ 140,000 | |||
Subsequent Event [Member] | Five Precent Unsecured Convertible Note [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Debt instrument convertible face amount | $ 1,500,000 | |||||
Debt instrument maturity date | Jan. 27, 2022 | |||||
Subsequent Event [Member] | Atlantic Technology Enterprises Inc [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Number of purchase shares | 200,000 | |||||
Shares issued price per share | $ 0.00001 | $ 0.00001 | ||||
Number of shares issued value | $ 75,000 | |||||
Additional share issued | 100,000 | |||||
Additional capital stock issued issuance costs | $ 150,000 |