A Decade of Promises, A Business Funded by Dilution
Wireless power for devices. Drained batteries for investors. After more than ten years and $408M in accumulated losses, WATT has not built a business — it has built a fundraising machine.
"The technology may charge devices, but the model charges shareholders."Fugazi Research — March 24, 2026
Energous Corporation is not a technology company executing a commercial roadmap — it is a structurally dilution-dependent entity that has used shareholders as its primary funding mechanism for more than a decade.
After 10+ years of promised commercial breakthroughs, WATT has accumulated a $408 million deficit while generating just ~$2.6 million in revenue for the nine months ended September 30, 2025 — a net margin of –319%. The company has raised capital through equity actions 21 times since 2019, maintains a $64 million remaining ATM registration (approximately 3× its market cap), and generates roughly $290K in monthly revenue against $1.1 million in monthly cash burn. The only reason WATT remains operational is continuous access to equity markets: of the $11.5 million cash increase in the first nine months of 2025, $21.6 million came from ATM sales, warrant exercises, and equity issuances. Governance concerns compound the structural problem — the CEO also serves as CFO, concentrating financial oversight in a single role while the Board numbers just four members. Fugazi concludes that continued dilution is not a risk but the operating model itself, and that shares are likely to revisit single-digit pricing.
Dilution Is the Business Model, Not a Risk
WATT has raised capital via equity actions 21 times since 2019. The company's cash position improved from $1.4M to $12.9M in the first nine months of 2025 — but $21.6M of this came from ATM sales, warrant exercises, and registered offerings, not from customers. Revenue cannot sustain operations; equity markets do.
CEO Serves Simultaneously as CFO — Zero Oversight Separation
Mallorie Burak holds both the CEO and CFO titles, eliminating the independent financial oversight layer that is particularly critical for a company whose survival depends on continuous capital market transactions. The four-member Board, including Burak, is small for a listed company and warrants scrutiny given the scale of ongoing dilution activity.
Leadership Network Tied to Serial Diluters and Prior Legal Issues
Burak's prior role as CFO at Knightscope — which disclosed material weaknesses in internal controls and has delivered a 99% loss to shareholders — followed a pattern nearly identical to WATT's. She was terminated from ThinFilm Electronics in May 2020 amid allegations of forecasting errors and internal control deficiencies (Santa Clara County Case No. 20CV367979). CAO Gregory Sadikoff also previously worked under Burak at Knightscope.
Executive Pay Exceeds Total Revenue by a Wide Margin
In 2024, Burak's total compensation was $849,551 and former CEO Johnston's was $1,343,485 — collectively exceeding the company's ~$800K annual revenue. Johnston's Q1 2024 severance alone totaled $1.563M — 2,442% of quarterly revenue. The company paid executives more to depart than it generated in an entire quarter of sales.
Technology Outcompeted After a Decade of Promises
Competitor Powercast has shipped over 30 million units in a decade to 100+ global customers. WATT, after 10+ years, counts just three paying customers responsible for 99% of accounts receivable. The "Fortune 10 deployment" narrative appears to overstate WATT's role — it appears to supply a low-value bridge-power layer within a broader Wiliot/Walmart/Avery Dennison ecosystem at ~$200 per transmitter unit.
Derivative Warrants with Aggressive Reset Features
March 2023 warrants carry reset features severe enough to be classified as derivative liabilities. Their strike fell from $8.00 initially, to $1.66 by March 2024, to $0.30 by December 2024, to $0.28 by June 2025 — and further resets are triggered by any ATM issuance below the current strike price. Authorized shares stand at 200 million against just 1.8 million currently outstanding.
Cash Sources: Operations vs. Equity Issuance (9 months ended Sep 30, 2025)
Source: WATT Form 10-Q, September 30, 2025 · USD millions · Equity issuance is the only meaningful source of liquidity
Revenue vs. Executive Compensation (Full Year 2024)
Source: WATT DEF 14A proxy, April 2025; WATT Form 10-K 2024 · USD thousands · Top-2 executive pay vs. annual revenue
| Name / Entity | Role | Concern | Status |
|---|---|---|---|
| Mallorie Burak | CEO & CFO | Holds both CEO and CFO titles simultaneously, eliminating financial oversight separation. Prior CFO at Knightscope (99% shareholder loss, material internal control weaknesses disclosed). Terminated from ThinFilm Electronics in May 2020 amid allegations of forecasting errors and internal control deficiencies (Santa Clara County Case No. 20CV367979). 2024 total compensation $849,551 vs. ~$800K company revenue. | Dual Role |
| Cesar Johnston | Former CEO (departed) | Departed with $1.563M in Q1 2024 severance — 2,442% of quarterly revenue at the time. Total 2024 compensation of $1,343,485 vs. ~$800K annual revenue for the full year. | Departed |
| Gregory Sadikoff | Chief Accounting Officer | Previously worked under Burak at Knightscope — a company with disclosed material weaknesses in internal controls, similar ATM dilution patterns, and a history of substantial shareholder value destruction. His appointment reinforces a leadership network tied to serial-diluter companies. | Network Risk |
| Michael Leabman | Founder; DivineWave Holdings (majority shareholder) | Founder of both Energous and Movano Inc. DivineWave Holdings LLC (formed by Leabman's parents) was one of the founding shareholders. Fugazi notes that entities associated with Leabman have exhibited similar patterns of heavy ATM usage, reverse splits, and value destruction. | Pattern Risk |
| Greg Brewer | Former Director | 2014 S-1/A disclosed Brewer's affiliate Absolute Ventures held 668,337 shares purchased for $160,000; separately, the company leased office space from ProSoft Engineering, identified as owned and founded by Brewer — a related-party arrangement disclosed in founding documents. | Related Party |
Energous Corporation founded by Michael Leabman as a wireless power technology developer. Lists on NASDAQ in 2013. The founding S-1/A discloses related-party share purchases, consulting arrangements, and affiliated lease arrangements tied to directors and their family members.
S-1/A discloses DivineWave Holdings (Leabman's parents) at 20.3% ownership; MDB Capital Group warrants at $0.04 exercise price; director affiliate Absolute Ventures at 668,337 shares for $160,000; and a $21,550/month consulting arrangement with the sister of a director and stockholder.
Energous utilizes ATM programs, registered direct offerings, and warrant issuances to raise cash 21 times since 2019. One particularly active offering period increases outstanding shares by more than 140% in just two months, triggering a Nasdaq compliance breach and necessitating a reverse split.
WATT issues long-dated warrants classified as derivative liabilities due to their reset features. The strike price falls from $8.00 at issuance to $1.66 (March 2024), to $0.30 (December 2024), to $0.28 (June 2025). Future ATM issuances below the exercise price trigger further automatic resets.
CEO Cesar Johnston departs and receives $1.563 million in Q1 2024 severance — 2,442% of the quarter's revenue. Mallorie Burak, previously CFO at WATT and Knightscope, is installed as CEO while retaining the CFO role.
WATT executes a 1-for-30 reverse stock split to regain Nasdaq minimum bid price compliance. The split does not reduce authorized shares (200 million remain authorized). Outstanding shares subsequently begin re-expanding. On a split-adjusted basis, share count has already increased approximately 458% since December 2024.
WATT amends its headquarters lease, downsizing its office space and issuing 75,000 shares to the landlord as partial consideration — a pattern mirroring a 2014 issuance of 41,563 shares tied to its San Jose lease, reflecting ongoing reliance on equity beyond conventional financing channels.
WATT reports $2.6M in nine-month revenue against an $8.3M net loss (–319% margin). Cash improved from $1.4M to $12.9M — but $21.6M of this came from ATM sales, warrant exercises, and registered offerings. Management states the raises extend the runway by approximately 12 months.
Fugazi publishes its short thesis, concluding that WATT is "uninvestable" with shares likely to revisit single-digit pricing. The remaining $64M ATM represents approximately 3× the company's market capitalization, ensuring the dilution cycle will continue indefinitely absent a dramatic change in operating performance.
Holds both chief executive and chief financial officer titles. Prior CFO at Knightscope, which disclosed material internal control weaknesses and has delivered a 99% shareholder loss. Terminated from ThinFilm Electronics in May 2020 amid control and forecasting allegations. 2024 compensation: $849,551 vs. ~$800K company revenue.
Previously worked under Burak at Knightscope. His appointment strengthens the overlap between WATT's current leadership and prior companies with serial-dilution patterns and governance concerns — reinforcing a network of associated value destruction.
Founded Energous and is also founder of Movano Inc. DivineWave Holdings LLC (formed by Leabman's parents) beneficially owned ~20.3% of WATT at IPO. Fugazi notes similar patterns of heavy ATM usage and reverse splits at entities associated with Leabman.
Continued dilution is not a risk. It is the model.Fugazi Research — March 24, 2026
Uninvestable: A Business Funded by Shareholders, Not by Customers
After more than a decade and $408 million in accumulated deficit, Energous has not built a business that funds itself. It generates ~$290K per month in revenue against ~$1.1M in monthly cash burn, with 99% of accounts receivable concentrated in three customers and a net margin of –319%. Its sole operational funding mechanism is equity issuance — 21 capital raises since 2019, a $64M remaining ATM at roughly 3× market cap, and a share count that has already re-expanded 458% on a split-adjusted basis since the August 2025 reverse split. The governance structure concentrates executive and financial oversight in a single individual whose track record at prior employers warrants scrutiny, supported by a four-member board. Fugazi concludes the shares are uninvestable and are likely to revisit single-digit pricing as the dilution cycle continues.
Primary Risk Factors$64M in remaining ATM capacity at ~3× market cap creates perpetual downward pressure. The company has a demonstrated history of utilizing this capacity aggressively and has no operating income to substitute for it.
Management indicated the $21.6M raised in the first nine months of 2025 extends runway by approximately 12 months. Estimates suggest cash may already be below $6M. Continued operations require further equity raises.
March 2023 derivative warrants reset downward with each ATM issuance below the current strike ($0.28). Any new equity raises below this level trigger further resets, compounding dilution in a self-reinforcing cycle.
Three entities account for 99% of accounts receivable and two customers represent 81% of revenue. The loss of any single key customer would be devastating to an already minimal revenue base with no demonstrated ability to acquire new customers at scale.
WATT's own 10-K warns it may fail to meet Nasdaq listing requirements. The company already executed a 30:1 reverse split in August 2025 to regain compliance. A share count that rapidly re-expands post-split signals the pattern will likely repeat.
CEO-CFO dual concentration, a four-member board, leadership with a track record of prior company failures, and a history of equity used as transactional currency (including to pay a landlord) all point to material oversight gaps around capital allocation decisions.
This dashboard presents a summary of research published by Fugazi Research LLC on March 24, 2026. All content, allegations, financial estimates, and conclusions contained herein are sourced exclusively from and attributed to Fugazi Research LLC. Activ8 Insights has not independently verified any claims made in the underlying report and expresses no opinion as to their accuracy or completeness. This summary is provided for informational purposes only and does not constitute investment advice or a recommendation to buy, sell, or hold any security. Fugazi Research is not registered as an investment adviser, broker-dealer, or commodity trading advisor. Research may contain forward-looking statements and opinions subject to change without notice. You should assume Fugazi Research holds a position in the securities discussed. The full disclaimer, terms, and restrictions on redistribution are available at fugaziresearch.com.