World Wide Childcare, Visitel and other scams Forum
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Hi Everybody,
I will first start with good news. I insist that this email is only about the product and the company.
I have lived during three days with them and I hope that my current feelings are justified: I am very optimistic and excited by this product and the
high market potential it represents. But I would understand that some of you would not share my point of view, knowing the context of the Story.
So Just accept that my words are sincere and if some of you have doubts, don't hesitate to visit them while in the neighbourhood.
1 - An incorporation at first and then a public Equity
Indeed, as SBS became public through the merging with Inet, they have
inherited the financial situation of Inet even if the money they have
invested in the research & development phase is not that huge. This
means that in the documents I have attached, I talk about cumulative
lost since the inception of the company. This lost is not representative
of the newly born SBS inc. but reflects the past transactions of former
Inet management team. But SBS now faces the need to respect the historic
accounting transcripts of the current state of the company. They will
publish soon the new documents with up-to-date figures for SEC. They
were working on it while I was there. In fact, they have to collect the
results of the PIPE contracts they have received before publishing the
new figures.
According to Michael Bronstine, they are very optimistic about raising
sufficient funds to invest in the production lines. He told me that some
news will be published very soon on the public websites (NASDAQ, OTCBB,
PINKSHEETS).
I have to admit that I met very motivated people only focused on the future steps of the development of the company.
They confirmed me that they were pointed with a "E" on nasdaq due to the
late introduction of the duly documents to SEC. They asked for a delay.
When SEC receive those ones, they will go back to a normal state for the
share.
2 - The product
As I have already mentioned in some email and postings, the prototype
has been delivered the day I arrived. I have seen also the previous
model of it (the one you can see on the previous version of their
website). I've tested it and it's really working fine. This is exactly
the principle we all know about the blue screen technology owned by
Ultimatte.
The prototype I
saw, respected, according to Todd, 95% of their needs. Some adjustements
about the lightening and the contrasts have to be done. otherwise, the
product is nearly good to market.
The production of the final product is planned in mid-October. What is
taking a lot of time, is the order of some components of the camera that
have to be ordered 5 to 6 weeks before beginning the production. part of
the money of the PIPE, will be used to pay those ones and to put in
place the final production line.
3 - the market
Their plans are clear for the next two years and half: they will focus
first on the professional market (Business-to-Business). This allows to
start the production of the camera while testing the production line at
a small scale. indeed their business plan forsees a production of 3300
units for this year (which is not too optimistic figure, I would say
realistic).
I have included their business plans (excel spreadsheet) and the
assumptions (number of units, future costs of tooling, etc ...). in the
spreadsheet, you will find two worksheets: the first is the one used in
the PIPE presentation that you may have received from them. I have made
the second worksheet (checked assumption) to reflect the productivity
and profitability by product lines. If you check the formula's I used,
you will be able to interpret those figures. But at first, here are some
conclusions:
- the ratio between fixed and variable expenses is quite good and is
decreasing over time. This means that main costs are related to the
product itself and product profits may be used easily to finance the
fixed assets. the opposite would be not good at all.
- the profitability of the hardware (camera) is increasing over time
thanks to the economy of scales. But this is the opposite for the
software (the production of DVD). So this part could be improved in the
future with negociations about the unit price of the DVD burning. you
may see that whatever the quantity is, the production price is always
5$. point to check in the future.
- The hardware is really the basic product for the profit. all the
success of the start is relying on the hardware first. which is quite
normal. But in the future, the software should normally take a more
important part when entering the consumer market. you all know that
without games, not Sony playstations. But as they begin with the
business market, this is not an issue.
- If we accept that the cumulative loss (cf. supra) is around
12.000.000 USD, the business plan is profitable after three years of
production. in the Business plan normativity, this is good. don't forget
that this loss is mainly due to past transactions of the Inet
corporation management team. otherwise, this would have been quicker.
- the production line is mainly managed by Ultimatte first. this means
that the costs around implementing a production line from scratch, are
lower than if they had to do it themselve.
4 - Share Valuation
How can we get profit of that?
in short to medium term, the only thing we may hope, is that the market
recognizes the high potential of the product. That's why the role of
Michael and Todd is crucial. Michael has plans for the communication towards the investor market in order to make a good publicity of the product and the business plans. So our role as
Shareholders is to promote this company around us.
Here is what i will personnaly do (this involves only myself) : My message to my friends and familly "If you may forget some part of your
money during two years, invest in this company". I really believe in the product and its future. If
some of you know reality show like "Star Academy", you may imagine how
narcissic the people are now. So watching themselves in the TV set and
being able to record that, is really something that new generations will
like. I showed the movie to my little boy and the reaction was
immediate. Well, I remind that this paragraph is just my own opinion. So
if you don't believe, just keep your holdings. If you believe, keep or even buy new ones (but this time through your bank or local broker).
I asked also a direct question to Michael : can we bring some contacts
so that they can present the product? Of course yes!!! So if some of you
have potential contacts, don't hesitate to talk to them about the
product. Personnaly, I showed to the product to some friends, salsa
trainers and they are really interested.
If you have more questions, don't hesitate to send them to the
distribution list.
My friendly regards.
Stéphane Fosséprez
