Calpian Inc (OTCMKTS:CLPI) Is A Roller Coaster Promotional Ride

Having spent the majority of July gaining value, Calpian Inc (OTCMKTS:CLPI) finally broke this week, and the company has dropped 23% since Friday last's close. The gains have come on the back of a few company updates, but primarily by way of a RedChip promotional campaign. Chances are, the latter is also partly responsible for the recent dip. Here's why.First, a quick introduction. Calpian is the corporate entity behind the operating company MoneyOnMobile ("MOM"). MOM is a payments processing company with its operations in India, with a host of offered services all rooted in payments processing. Primarily, these revolve around utilities payments, cell phone top ups, that sort of thing. It also operates a remittance service, however, whereby it allows users to transfer money between one another.Financials are a little bit misleading – at least historically. Before the second quarter of last year, Calpian recorded revenues as gross, meaning it reported the total amount of payments made through its system as revenues. Of course, these payments then transferred to the relevant service providers (or the individuals in the remittance service) and Calpian's fee is only a fraction of total funds received. Starting second quarter 15, the company now records revenues as net, which is far more representative of the underlying reality. What it means, however, is that growth comparisons are tough. FY 2015 revenues came in at $28 million, for example, but $24 million of this derives for the gross revenues recorded during the first quarter of the year, pre change in protocol. Actual quarterly revenues come in at circa $1.5 million a quarter (a little higher and a little lower for the last last three reported periods).Net loss for the final quarter of 2015 came in at a little over $5 million, which isn’t unusual for a growth tech company, but it means we're probably going to see some pretty toxic financings near term. Cash at end December was $2.3 million, and revenues likely wont make up the operational cost shortfall.So what's the deal with the promotion? Well, this same thing happened this time last year. RedChip is a microcap "profiler" that takes compensation for publishing information on various companies. Calpian is one of these companies, and there has been a recent newsletter and a video interview go out over the last couple of days on behalf of RedChip detailing the company and its operations. This is only the start, however.Take a look at this element of the disclosure section on RedChip's site:

"Calpian, Inc. (CLPI) is a client of RedChip Companies, Inc. CLPI agreed to pay RedChip Companies, Inc. 150,000 shares of Rule 144 stock for six (6) months of Investor awareness services."

So RedChip has a vested interest in Calpian's share price increasing. These share issues are often restricted, and the publishers aren’t able to sell shares for a certain period of time. Not so in this instance, however.

"RedChip and/or its affiliates may buy or sell shares at any time."

So RedChip can unload its shares as and when it sees fit. This is important as (and we're just speculating here) it means RedChip can unload portions of its shares on short term gains. In other words, its interest isn’t necessarily to boost the company as much as possible and then sell once the promotion ends (as is sometimes the case with the restricted issues). Instead, it's to boost it as much as possible, as many times as possible during the promotion period. What happens after the promotion ends (again, this is speculation, but logical) is of no importance to the company.So, this could well be the driver behind the recent decline. The company gained into mid July, and someone unloaded a bunch of shares, causing a dip. The point here is that once the promotional period is is up there's every chance Calpian will fall as its fundamental value, and not its perceived value becomes apparent.Short term gains are possible on this sort of rollercoaster action, but as a long term valuation the current market cap (circa $46 million) doesn’t look supported by what's under the hood.Sign up to our free newsletter below and get our current updates on CLPI!Disclosure: We have no position in CLPI and have not been compensated for this article.