Hey everybody - I recently wrote a DD on Chewy and in the process I learned A TON. A little background on me:
I'm a veterinarian for the past 2 years, and have been in the vet industry since 2011. I've worked in a variety of clinics from ER to general practice. During my write up of Chewy, Zomedica was brought up sevaral times and I started to look up a bit more and wanted to write down my thoughts.
AS ALWAYS - PLEASE REMEMBER THAT IM LITERALLY AS GREEN AS THEY COME. DON'T MAKE BETS ON WHAT I SAY AND DO YOUR OWN RESEARCH. THE ONLY TIME I INVESTED ON MY OWN PRIOR TO THIS WAS IN GME AND I LOST EVERYTHING. So tear this post to shreds pls so I can learn more.
Summary of Zomedica:
Zomedica is a veterinary health company that is currently in the development phase of their products. Their focus is "point-of-care" devices - aka in house testing. This has been a growing field, as the use of point of care (from here on acronymed POC) has become more and more common in the veterinary field as the devices have gotten more and more affordable and easy to use.
Zomedica's current golden boy that they are hyping up hard is their Truforma device which I will go into extensive detail below. They recently (in the last quarter based on SEC documents I read) have promoted their CEO from interim to full time and from what I've seen, it seems like they have a decent team on their hands.
Truforma specifics and analysis:
Truforma is a POC device meant to deliver testing for thyroid and adrenal disease. Truforma uses "Bulk Acoustic Wave" (BAW) technology which they claim provide accurate and repeatable test results. THE RISKS OF THIS WILL BE LISTED BELOW IN THE RISKS SECTION.
Now here's where I hope my insight as a vet comes in - shits gonna get technical in here so buckle up and ask if anything doesnt make sense.

Thyroid testing:

There are 2 main thyroid diseases - HYPOthyroidism (low thyroid) and HYPERthyroidism. And there are 2 main animals we care about these conditions for in a veterinary setting - cats and dogs. Luckily, HYPERthyroidism is very rare in dogs and HYPOthyroidism is very rare in cats. Where I think the hype really dies down is that NEITHER of these diseases are emergencies. 99% of the time, we DONT need a diagnosis the same day. Sending blood samples to test for either of these diseases get returned in typically 24 to 72 hours (often 24 hours). And the thing is - sending blood to the lab is nine times out of 10 cheaper than POC testing. So honestly, these thyroid tests in house aren't that big a deal. I am very confident that if their only offering was thyroid testing, that most clinics wouldn't purchase their product.
The only instance where I would like an in house TSH test (thyroid stimulating hormone) on a more POC basis is when I have a sick, skinny cat who looks like a HYPERthyroid cat. The most common way to diagnose a HYPERthyroid cat is with a Total T4 test which is widely available POC test now. But oftentimes, if they have multiple concurrent diseases that T4 level will be decreased due to something called "euthyroid sick syndrome". In those instances, you would want to do a TSH test and a free-T4 test , and while we can easily send out those tests to the lab I can imagine some people would want answers more quickly. But realistically - these cases are few and far between and there hasn't been enough demand to warrant a POC test for it.
So basically - thyroid testing w/ truforma alone isn't very hype and honestly not that exciting.

Adrenal testing:

So this is where things could get interesting. The thyroid testing Truforma offers is ACTH stim testing. There are 2 thyroid conditions - Addison's disease (adrenal glands not working) and Cushing's diease (adrenal glands working too much).
Now with cushings - again, this isn't an emergency. The need for POC testing is fairly low because this is a chronic disease that has been going on for months - waiting an additional day doesn't change much. There are two ways to test for Cushings -
ACTH Stim testing - this is a 2 hour long test which you have to send to the lab. According to recent studies, this is considered by some specialists to be worse than the test listed below. HOWEVER - some specialists will still use this test because its a 2 hour test, and not an 8 hour test like the one listed below. So there is a use for Truforma regarding Cushings testing and ACTH stim - however it's not too exciting.
Low Dose Dexamethasone Suppression Testing - this is an 8 hour test and considered the gold standard test for diagnosing Cushings. However - people will still use the ACTH stim because of the time constraints with this test. I've had specialists tell me they use the ACTH stim solely because their schedule does not allow for the low dose dex test. Ultrasound (not widely used to diagnose cushings as the first step)
Now here's where the hype comes in -
Addison's disease is the only disease of the whole bunch that is an actual emergency. Addison's can quickly proceed into something called an "addisonian crisis". This is a very severe, deadly condition from untreated addison's disease. And the reason addison's goes untreated is because it shows very non specific, hard to diagnose signs. And here's the bitch - to diagnose addison's, we need to do an ACTH stim! And currently, we'll start treating addisons on suspicion and other bloodwork results but we still have to wait a whole freakin day for the results. And I've euthanized a shit ton of dogs who I've thought are addisonian, however owners couldn't commit to days in the hospital on a "maybe" alone. To treat an addisonian crisis, you typically need multiple days in the hospital and very specific drugs - but its VERY treatable. So when I have an owner come in with a sick ass pet, the convo goes like this -

"Hey - you're dogs sick as shit. Bloodwork makes me think it's addison's disease. The test for it is pretty expensive, and it'll take at least 24 hours to get results. In the meantime - we need to hospitalize your dog, which is gonna cost you a couple grand. Also - if that test comes back negative in 24 hours, than we dont know whats wrong".

It's hard, especially when clients are financially constrained.
NOW the conversation can go:

"Hey - you're dogs sick as shit. Bloodwork makes me think it's addison's disease. I can do the test in house.If it's positive than your has a good chance of survival." - So they do the test, it comes up positive, and BAM - they hospitalize and vets make bank.

In the first scenario, we might make a few hundred bucks and probably less than a grand. But in the second, if we convince owners to use the in house test and prove their dog has a very treatable disease, the likelihood of them dishing out big bucks to fix their dogs are WAY higher. Cause clients are way more likely to drop a shit ton of money if they think it's a fight they can win. But when there are so many questions left in the air, a lot of clients won't go into debt on a maybe (rightfully so). For this reason alone, I am slightly bullish on Truforma and ZOM.
Competitors and Risk:
Here's where I start to get bearish again. From the outside, it looks like ZOM may have a deep moat - new technology, only POC test for the conditions above, etc.

As I said before, Truforma uses BAW technology -** but based on everything I've seen so far, it seems like they don't actually own the BAW technology.** Because of that, I don't see why their main competitors can't make a device on their own. Their main competitor in the POC field is Idexx - one of the top and biggest veterinary testing companies in america. Idexx has expanded to include not just testing, but absurd amounts of integrated software to the point that whole hospitals are run on Idexx products alone (medical recording software that integrates seamlessly w/ their lab services and their xrays and payment plans and eveyrthing else - its crazy). So if Idexx annouces ACTH testing in house, Zomedica is truly EFFED.
Additionally, many labs will often have a degree of exclusivity contracts with hospitals - however this mainly deals w/ send out bloodwork and isn't really BLOCKING you from using other companies - just giving you way more incentives if you stick with idexx.
Additionally - ZOM has not been profitable yet. They haven't really made any money yet and are very speculative. Looking at their recent 10-Q risk section says it all. They're still in development, and honestly they might not pan out. It's an incredibly risky buy and if Truforma goes to shit than ZOM is done for.
Another competitor is the opportunity cost of losing shelf space in a vet hospital. Truforma has to compete with a very limited work area in most vet hospitals - I have a very big lab in my current hospital, and even there I struggle to see where I would fit ANOTHER device. It's starting to get cramped and this may play a factor in hospitals getting fatigued with ANOTHER machine they need to maintain and ANOTHER machine they have to order test kits for and ANOTHER machine they need to be trained on. It honestly gets exhausting and while it may sound dumb, it really may dissuade a lot of hospitals from jumping in.
And lastly - this really isn't a device that'll be used in most hospitals to begin with. Think of rural america middle of nowhere vets who barely have POC machines - this is not gonna be the first one they buy. Even very busy metropolitan hospitals might not care for this if they see limited emergencies and are mainly GP. I've worked ER and urgent care for most of my career, so I see the use of the testing - but my gf is a GP vet and after talking to her, in the last few years she can only think of a handful of cases this would apply to.

Why I'm bullish and what my target is:
As I listed above, the use of ACTH POC testing in an ER setting cannot be understated. And there are quiet a few ER hospitals in America, and more and more are coming. Those ER hospitals typically have the best and newest swag - it's there that you see all the newest POC machines. I'm talking crap that even my hospital doesn't have (and we're an urgent care hospital obsessed w/ shiny new equipment). So I REALLY think that they will hop on board. Additionally, ZOM has a Truforma distribution w/ Miller Vet Supply which is a MASSIVE distributor of vet products. And what I really, REALLY hope happens is that the big boys like Idexx sees the moat and thinks - fuck it, why fill the moat when we can just buy the castle and buys Zomedica out for a fat chunk (or buys / partners w/ ZOM to sell the Truforma system for ACTH testing). THIS is the golden scenario where I think we can make big bank.
So yes - ZOM is an INCREDIBLY risky play. They haven't released their product yet, but it's coming out soon. We HAVE NOT seen how they are customer service wise, test accuracy wise, reliability wise, ease of use - nothing. And half their tests are honestly not that exciting. But if they can generate enough hype and demand to get their product noticed by the big boys and even bought out I think we can all make a ton of bank. And with the price being so low rn ( < $3 a share), it might just be the best time to jump in.
My position: 108 shares @ $2.31 (Don't laugh I'm broke). My target price is 10 bucks a share where I'll most likely cash out my doubly my original position.

$HCMC Healthier Choices Management Corp stock complete DD Package+Filed big lawsuite against Philip Morris $PM Nov30th '20/ pennystock exempt!

$HCMC

-60+ patents

-Pink Current

-pennystock Exempt

-MarketCap $665million

>Feb.8 2021 HCMC ANNOUNCES SALES OF $5,000,000 OF PREFERRED STOCK

February 7, 2021, Healthier Choices Management Corp. (the “Company”) entered into a Securities Purchase Agreement, pursuant to which the Company sold and issued 5,000 shares of its Series D Convertible Preferred Stock (the “Preferred Stock”) to institutional investors for $1,000 per share or an aggregate subscription of $5,000,000. https://finance.yahoo.com/amphtml/news/hcmc-announces-sale-5-000-130500804.html?__twitter_impression=true
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>Aug.24th, 2020 Secured $2.5million in financing for their #PPE initiative.

"We identified a NICHE market that needs servicing, and we intend to take an ‘old school’ approach of building a consistent book of business for this initiative. The industry has been inundated with “spot sales”, often attempting to sell product that does not exist. We intend to eliminate this issue by having inventory in our warehouse, READY to ship.”
“All types of businesses now need these products. Smaller health facilities need these products. Smaller businesses like restaurant chains and service industries need these products, and they cannot buy 1,000,000 boxes of gloves or 1,000,000 masks as is typically required. WE HAVE HAD NUMEROUS REWQUESTS TO FILL THESE ORDERS and intend to cater to this niche and help as many of these types of customers as we can.” https://www.globenewswire.com/news-release/2020/08/24/2082593/0/en/Healthier-Choices-Management-Corp-Secures-2-5M-financing-for-PPE-Initiative.html
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>A leader in the #CBD Vape industry! The Q-Cup can be used for Marijuana & CBD!

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>Aug. 20, 2018 (GLOBE NEWSWIRE) -- Healthier Choices Management Corp. (OTC Pink: HCMC) today announced that it has entered into a distribution agreement with MJ Holdings Inc.

(OTC Pink: MJNE), a leader in the Nevada Cannabis market, to exclusively sell and distribute its cannabis and CBD patented and patent pending quartz “Q-Cup” technology in the Nevada territory. https://www.globenewswire.com/news-release/2018/08/20/1553951/0/en/HCMC-Lands-Initial-2M-Deal-With-a-Leader-in-the-Nevada-Cannabis-Market-for-Distribution-of-Cannabis-and-CBD-Related-Patented-and-Patent-Pending-Quartz-Q-Cup-Technology-Updated.html
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>HCMC Announces Publishing of an Independent Report Regarding the Use of Arecoline as a Possible Preventative for Covid19. HCMC Owns U.S. Patent Covering Processes and Methods of Manufacture of Arecoline! https://www.globenewswire.com/news-release/2020/04/03/2011503/0/en/HCMC-Announces-Publishing-of-an-Independent-Report-Regarding-the-Use-of-Arecoline-as-a-Possible-Preventative-for-Covid19-HCMC-Owns-U-S-Patent-Covering-Processes-and-Methods-of-Manu.html

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>HCMC Loaned VPR Brands ( OTC:VPRB ) $500,000!

This is from the recent SEC filing of the OTC stock VPRB! On September 6, 2018, the Company issued the Amended and Restated Secured Promissory Note in the principal amount of $582,260 (the “A&R Note”). The principal amount of the A&R Note represents (i) $500,000 which Healthier Choices Management Corp. (HCMC) loaned to the Company on September 6, 2018, and (ii) $82,260, which represents the aggregate amount owed by the Company under the Original Notes as of September 6, 2018. The A&R Note, which has a maturity date of September 6, 2021, had the effect of amending and restating the Note and bears interest at the rate of 7% per annum. Pursuant to the terms of the A&R Note, the Company agreed to pay HCMC 155 weekly payments of $4,141, commencing on September 14, 2018 and #ENDING on September 14, 2021, and a balloon payment for all remaining accrued interest and principal in the 156th week. The Company at its option has the right, by giving 15 business days’ advance notice to HCMC, to prepay a portion or all amounts outstanding under the A&R Note without penalty or premium. The balance of the note as of September 30, 2020 was $314,247.

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>BIG Lawsuit against $PM for patent infringements, and patent 170 The Q-Cup is part of it. [www.TheQCup.com]

$PM has untill the Feb26th to submit their answer. Been researching/ alerting this since Nov.30th & theirs rumors the answer is a settlement!

>Lawyers representing HCMC have been awarded as the #1 lawfirm of the year amongst dozens of other awards. You think they would take on PM A big Pharma company & risk their reputation if they had even the slightest chance of losing? No they wouldn't. [www.cozen.com]

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>Millions in annual revenue from 13Vape stores, 3 Paradise Health & Nutrition stores, 3 Adas Fresh Market, online Vape & CBD retailers, online health & nutrition retailers, and much much more!

Website retailers/ entity's subsidiaries all owned by HCMC:
[www.vaporin.com]
[www.TheQCup.com]
[www.adasmarket.com]
[www.healthiercmc.com]
[www.TheVapeStoreInc.com]
[www.HealthyUWholesale.com]
www.SmokeAnywhere.com
https://twitter.com/BizWrld/status/1356554285656334337?s=19

[www.TheVitaminStore.com] this site has many Health & Nutrition products listed on Amazon!

HCMC owns dozens of brands, 1 is Garden of Life that are rated #1 best sellers w/ 20k+ 4.75/5 star reviews! Look it up!
-https://www.amazon.com/dp/B007S6Y6VS/ref=cm_sw_r_cp_apa_fabc_03KESEA9XAJAR1RYW3TS?_encoding=UTF8&psc=1
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>In the lawsuite their is 2 defendants named; Philip Morris USA & Philip Morris International! So technically it'll be a 2 for 1 win! Double the judgement too if look at it that way.

>Jan. 29th update to lawsuite:Judge approved PM request for a extension to submit their answer saying by February 26th now:" So that both defendants can submit their answer at the same time"Court also said no jury trials untill April now. HCMC said in their initial motion that they demand there be a jury trial for settling judgements. So PM better offer a big enough settlement to avoid that.

-Rumors going around about the April deadline date. That is when jury trials can resume. Because courts have suspended all Jury Trials due to COVID-19 until April 18th. People been getting confused and people spreading false information on purpose. So as of right now the only date on the case is the February 28th due date of Philip Morris's answer.

Once that is submitted, wether it be a settlement or accepting what they have done or deny the motion against them of infringing on HCMC's patents, than they will schedule the next court date.
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>All press releases from Globe Newswire: https://www.globenewswire.com/Search?organization=Healthier%20Choices%20Management%20Corp

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THINK ABOUT AFTER HCMC WINS THE LAWSUITE AGAINST PM.

THEY'LL ASK HCMC TO LICENSE OUT THE PATENTS THEY HAVE INFRINGED ON! THEIR IQOS PRODUCT HAS 14MILLION + USERS, SO I DOUB'T THEY WOULD WANT TO ABANDON THAT REVENUE STREAM! THEY HAVE DOZENS OF ACTIVE TRADEMARKS FOR THE IQOS PRODUCT, AND PAYING HCMC TO USE IT IS THEIR BEST CHOICE! YOU THINK HCMC GOING TO GIVE THEM A DEAL, LOL HECK NO. THE MONEY FROM THIS LAWSUITE IS GOING TO MAKE IT THE BIGGEST LAWSUITE IN THE #OTC ! AND I BEEN TRADING SINCE I WAS 15, AND IN 16YRS NEVER SEEN A STOCK SO CHEAP, PINK CURRENT+PENNYSTOCK EXEMPT, 60+ PATENTS AND ALREADY LICENSES OUT MANY OF THEM! I BET LOTS OF #VAPE PRODUCTS IN THE MARKET ARE FROM COMPANYS PAYING LICENSING RIGHTS FROM $HCMC!!!
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PLZ SHARE & UPVOTE! I HAVE SPENT 100S OF HOURS ON RESEARCH FOR THIS STOCK & CONTINUE TO DO SO. SINCE I STARTED TRADING WHEN I WAS 15, NOW 30, I HAVE NEVER SEEN SUCH A GREAT STOCK, WITH A BIG LAWSUITE SO CHEAP!
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>I have full access to court records. As documents are submitted for the case etc, I'll update them here accordingly. STAY TUNED!

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>Investors Hub forum + tons of info for HCMC: https://investorshub.advfn.com/Healthier-Choices-Mgmt-Corp-HCMC-15314/ HCMC Ihub ForumLink

Tons more DD on my Twitter:https://twitter.com/BizWrld?s=09

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Additional support, resources, & DD by WallStreetBets+OTHERS:

WSB is behind HCMC NOW!

$WallStreetbetsELITE: "CONGRATULATIONS TO $HCMC!! You have been accepted into the AMC AND GME COMMUNITY BY ALMOST 1000 VOTES!!! HCMC will now be the stock to promote with AMC guys HOLD THE LINE and respect this honor. We will together destroy Wallstreet and hedges! Much love."

/ https://www.reddit.com/WallStreetbetsELITE/comments/l8vjl6/congratulations_to_hcmc_you_have_been_accepted/

$HCMC "HOLD THE LINE! - $WSB $WSB / REDDIT / TWITTER / TARGET $HCMC AS PRIMARY FOCUS!

HCMC in the spotlight for a massive Monday breakout!!! https://www.reddit.com/WallStreetbetsELITE/comments/l8cfuu/hcmc_amc_and_gme_only/ https://twitter.com/setox/status/1355396529771728898/photo/1

GET READY TEAM! LOAD UP STRAP IN AND HOOOOLD ON!!!! $HCMC IS ABOUT TO ROCK THE WORLD! (IMO)

*Not financial advice.

https://preview.redd.it/b0ga6euf21f61.jpg?width=1440&format=pjpg&auto=webp&s=0645348ef8ac946f0de9c4e0e9facab43f4e9836
CEO owns 39billion shares! Now one share has been sold since 2011!
https://preview.redd.it/7d4lxpeg21f61.jpg?width=1440&format=pjpg&auto=webp&s=5ab89c949373ada13bed7ad4f938b01b95dad7b8
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HCMC owns Vapor corp. HCMC was actuallactuallyactuallactually formerly Vapor Corp. HCMC owns Vaporin.cVaporin.com too!
https://preview.redd.it/tkn44pyf21f61.jpg?width=1440&format=pjpg&auto=webp&s=c5f7a62a72bf76944f06557d737dd58feb5f1ef3
https://preview.redd.it/6odds4vf21f61.jpg?width=1440&format=pjpg&auto=webp&s=c78051a9ac43672ca47c3b65cd168e106d48b3ac
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A producproduct of HCMC sold on Amazon. See their Vitamin Store.

Full list of HCMC patents:

(https://preview.redd.it/6oj78o2g21f61.jpg?width=1440&format=pjpg&auto=webp&s=3e25ea759bf5bb66ff0fdcdd2cf3c78fa97d4642)
Big Mike talks about HCMC and their patent owned Q-Cup Vape.
https://preview.redd.it/7ug7fbxf21f61.jpg?width=1440&format=pjpg&auto=webp&s=16d5d3c7714e78405ae2f2569b21bd771fecafc9
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>Cozen is the lawfirm representing HCMC. They also recieved lawfirm of the year awardawards too.](https://preview.redd.it/olgsji5g21f61.jpg?width=1440&format=pjpg&auto=webp&s=27306f61d4a61e7d6871fbc76ee1e1d448dc276b)

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Additional information from a Ihub post:

THE CALL (READ) $HCMC TO TH MOON! The below posts are all timestamped it is a timeline of older $HCMC DD + my thoughts back in 2020 about $HCMC and what was going to happen before all the hype and media frenzy and hubaloo... O_O and now here we are today.
read if you are interested its long just a warning near the end is a monster DD post i did that was reposted on the wall here that many people read
cheshirechocobo Monday, 12/28/20 11:12:53 AM Re: None 0 Post # 20121 of 30551 IMO people in the inner circle of HCMC know a little more about this than they are letting on but the volume and money is talking. Methinks the HCMC Lawyers are working overtime because if the case was falling through so would the volume... IMO
The big Lawsuit people are talking about is between HCMC vs Phillip Morris for those who are new here and are curious.
I think HCMC is on top of this very much because "intellectual property" is a main part of their platform and if someone else infringed on one of their patents that they conceive / design / develop they are in the position to take action against that.
https://www.nasdaq.com/press-release/hcmc-announces-formation-of-intellectual-property-holding-subsidiary-2020-12-14)
(Copied - + more there is even more info in the full article - follow the link to read- )
HOLLYWOOD, FL, Dec. 14, 2020 (GLOBE NEWSWIRE) -- Healthier Choices Management Corp. (OTC Pink: HCMC) (“HCMC or the “Company”) announces that it has formed a new wholly owned subsidiary to hold, market and expand on its intellectual property assets. This subsidiary, HCMC Intellectual Property Holdings, LLC, will own all of the patents, trademarks and other intellectual property of HCMC.
HCMC currently owns a portfolio of patents related to both vape technology and also manufacturing processes and procedures for an imitation nicotine product. HCMC’s focus with this new subsidiary is to invest in innovation and encourage further development of core intellectual property.
“The creation of a separate intellectual property holding entity allows us to efficiently market, license and otherwise capitalize on our growing intellectual property portfolio,” said Jeff Holman, CEO of HCMC.
Mr. Holman concluded, “We feel that we can use HCMC Intellectual Property Holdings to further implement our strategic plan and better capture opportunities to monetize both technology that HCMC has already developed over the years, as well as technology that we will continue to develop into the future.”
https://www.nasdaq.com/press-release/hcmc-announces-formation-of-intellectual-property-holding-subsidiary-2020-12-14
HCMC is BIG on their patents and intellectual property. If someone steals your intellectual property or develops something you already patented then you can then legally sue them...by doing this you can in theory make more money suing someone for copyright infringement on intellectual property than you can on the infringed product in question At that point you don't even have to develop the initial idea to make money.
AND THEN After the settlement from a victorious case...
You can then use the money from the lawsuit to develop your business / product. lololol (that makes me smile)
IMO as always but this is what I see
thoughts?
(THIS BRACKET IS ME REFLECTING FOR A SEC IN 2021...might as well be a time traveler LOL OK KEEP READING THAT WAS A BRAIN BREAK)
cheshirechocobo Monday, 12/28/20 01:06:15 PM Re: BJ-Trader post# 20122 0 Post # 20138 of 30551 This is what I see
110 000 000 x.0001 = 11,000,000$ (seems like alot) BUT!!!!!
HCMC IS SUING Philip Morris OVER THE IQOS System
The IQOS heated tobacco units have become the third biggest tobacco brand behind Philip Morris' industry leading Marlboro and Imperial Brands' Winston. IQOS now has a 5.5% share of the global tobacco market, even though it hasn't been fully rolled out in a number of the 52 markets it's been introduced into.
Smoking alternatives heat up the market There are now 13.6 million users of the IQOS,(at 100$ per unit making 1 360 000 000 $)
that's 4 million more users than a year ago, and Philip Morris estimates 71% of them (around 10 million people) have stopped smoking and permanently switched to the device.
If Philip Morris are found guilty of patent infringement on every single sale of every single IQOS unit...
They have to cough up a massive chunk if not all of a 5.5 % share in the entire global tobacco market...of planet earth... over to HCMC.
A scenario like that would defiantly cover it...
DD for ya
Healthier Choices Management Corp. Files Patent Infringement Lawsuit Against Philip Morris
November 30, 2020 17:00 ET | Source: Healthier Choices Management Corp HOLLYWOOD, FL, Nov. 30, 2020 (GLOBE NEWSWIRE) -- Healthier Choices Management Corp announced the filing of its patent infringement lawsuit against Philip Morris USA, Inc. and Philip Morris Products S.A. in connection with their product known and marketed as “IQOS®.” The lawsuit was filed in the United States District Court For the Northern District Of Georgia.
HCMC vs Phillip Morris Lawsuit filing https://sec.report/Document/0000844856-20-000047/
The international law firm Cozen O’Connor has been engaged to represent HCMC in this matter.
https://www.cozen.com/
(MONSTERS ^ )
HCMC’s lawsuit includes claims that Phillip Morris is infringing HCMC’s patent rights in connection with IQOS®, an alternative tobacco product marketed and sold by Phillip Morris. Philip Morris claims that it is currently approaching 14 million users of its IQOS® product and has reportedly invested over $3 billion in their smokeless tobacco products. Philip Morris has been very open about their ongoing transition from traditional fully combustible cigarettes to their modified risk tobacco products, including IQOS®.
https://www.pmi.com/faq-section/faq/what-is-iqos
clearly covered http://www.healthiercmc.com/patents
The Philip Morris IQOS® product is currently the subject of two other patent infringement proceedings filed by RJ Reynolds Tobacco Company. One proceeding is before the International Trade Commission and seeks to stop the importation of the IQOS® product into the United States.
(added)THE INTERNATION TRADE COMMISION / FDA proceeding for the sale and distribution of IQOS system in the united states was in fact just recently approved.
https://www.pmi.com/media-centenews/the-fda-authorizes-the-sale-of-iqos-3-in-the-us
; the other is a patent infringement action currently pending in the Eastern District of Virginia. RJ Reynolds’ patents are unrelated and not affiliated with the patents asserted in the HCMC case.
“We are pleased that after a lengthy and careful analysis, a law firm with the patent litigation reputation and strength of Cozen O’Connor will be enforcing our patent rights,” said Jeff Holman, CEO of HCMC.
Mr. Holman concluded, “We look forward to proving our allegations of infringement in this matter and intend to continue to move forward against any and all companies that infringe upon our intellectual property in both the tobacco and cannabis categories.”
HCMC is in the right here...
FYI an IQOS system costs 100$ 13.6 million users all payed 100$ or 99 euros so 13.6 million users x 100S per unit as of feb 2020 (#'s don't reflect all the new users between feb to now either so the number is larger)
There are now 13.6 million users of the IQOS, 4 million more than a year ago, and Philip Morris estimates 71% of them (around 10 million people) have stopped smoking and permanently switched to the device.
As of Feb 10, 2020
At this point almost a year later they have even more users and now FDA approval for sale running around flag shipping the IQOS System that is in fact actually HCMC's patented intellectual property.
If or when PM ends up on the block and are forced to pay up on those kind of numbers to HCMC. The more greedy they get(and you know they are greedy) the more in the end they owe to HCMC and also the IQOS system that is actually HCMC's intellectual property is now FDA approved for sale in the US. (thanks to PM lol )
cheshirechocobo Wednesday, 12/30/20 10:56:17 PM Re: Badge04 post# 20507 0 Post # 20508 of 30551 MY POINT EXACTLY...If everything clicks for HCMC's legal team and the case goes through they will get rid of the float faster than you can spin your head.
I think they already are even?
If it all goes down in HCMC's favor and this will blow up so monster it will become an OTC legend. If you picked up .0001's on HCMC and held out on this it could change your life.
HCMC can buy out the whole floor after the settlement and if the people involved high up / HCMC's legal team already know how it's going to work out in the end they could be getting an early start not waiting for the courts, to begin enacting their plan and as for .0001's / .0002's they wont even exist afterword's if that is the case they will be a thing of legend as well.
No guarantees but man you could almost make a movie out of the story developing around this, at least a documentary.
At .0001 / .0002 tickets to the show are nothing compared to the ROI potential.
cheshirechocobo Monday, 12/28/20 02:26:15 PM Re: None 0 Post # 20155 of 30551 A theory
HCMC would be smart to keep surprising the price until the court case settles and they then buy up their own shares at .0001 with the money from the settlement.
That scenario would explain why so much volume yet no movement.
If HCMC runs up before the court case ends they can't buy their own shares for .0001 . So they keep it as low as possible and load it until they are ready to buy themselves for .0001 with money from the court settlement funds.
Anyone holding when that happens would just jump up along with the massive big block buys that would follow and HCMC has a massive rocket ride.
That's also how they can own a lot of themselves moving ahead into the future
thoughts?
cheshirechocobo Tuesday, 12/29/20 12:40:55 PM Re: RoidBoi44 post# 20268 0 Post # 20276 of 30551 ok Roidboi ... look...
I don't have a chalk board so I cant draw it out for you but..
HCMC will be able buy out their own bottom floor shares with IQOS Patent lawsuit settlement money.
HCMC sues PM and then all of a sudden HCMC has billions and billions in volume everyday...
I believe HCMC are the ones who will end up with the money to move it and that is why there is so much because its not for us to move its for them to get the lowest price possible on their own shares.
In doing so they will own themselves protecting / controlling their own shares from the bottom. They will then drive the price up as much as possible to give those shares maximum potential value in the future.
This is how an OTC company jumps up on to Nasdaq level.
"The Come up" as it is said.
Phillip Morris is under the gun because they used HCMC's technology (q-cup) in their IQOS vape system.
I suspect they had .0001s reserved for themselves in priority somehow hence the cancelation of everyone's orders on multiple trade platforms even though 0.0001 were reading as available...
This is all IMO but the writing is literally on the wall. The Volume here to me is the dead giveaway Someone's moving the cart along...
Unicorn Potential
END TIMELINE The above posts are all timestamped is a timeline of my thoughts back in 2020 about HCMC and what was going to happen before all the hype and media frenzy and hubaloo... O_O and now here we are today
I'll let you decide if you think I called this one ;) <3 I'm not even going to claim it...
This was the big post I mentioned about reposting and as a reward if you make it through all of this I will be reposting New DD and theory
This was the post that I believe opened some eyes. as follows
HCMC Q-Cup Tech Patent = Phillip Morris IQOS System Flagship next gen vape product being heavily pushed and marketed over 16 million + units already sold globally as of 2020 (the year isn't even over)
So HCMC owns the patent for the technology being used and sold in Phillip Morris's "IQOS" - E cigarette technology
The accused action is illegal
The IQOS system is a major money maker for Phillip Morris having sold 16.4 million units globally as of now.
https://www.nasdaq.com/articles/will-rrps-growth-keep-driving-philip-morris-pm-in-2021-2020-12-28
^Copied from above link (more in article)^
Tobacco companies have long been struggling with declining cigarette sales, thanks to consumers’ rising health consciousness as well as strict marketing and manufacturing policies imposed by regulatory authorities. Amid such a scenario, industry players like Philip Morris International Inc. PM are managing to stay afloat on the back of growth in low-risk tobacco alternatives. Additionally, gains from effective pricing strategies have been an upside. Let’s take a closer look.
RRPs Are a Key Growth Catalyst Philip Morris is committed toward developing a smoke-free future by expanding offerings in the reduced-risk products (RRPs) category. These products, owing to their beneficial claims, are largely being accepted by individuals trying to quit or reduce cigarette consumption. Philip Morris is one of the industry pioneers in driving the shift from cigarettes to RRPs. The company’s IQOS is one of the leading RRPs in the industry. IQOS was launched in the United States in 2019, through a commercial deal with Altria Group, Inc. MO that was approved by the U.S. Food and Drug Administration (FDA). We note that IQOS is currently the only heat-not-burn product in the U.S. market, which has been approved by the FDA.
Since the onset of the pandemic, the switch from smoking cigarettes to RRPs has been trending positively. Total users of IQOS at the end of third-quarter 2020 were estimated to be about 16.4 million globally. (So 16.4 million units x 100$ per unit = 1640000000$)
In the said quarter, revenues in the RRPs category increased 28.6% and formed a little more than 23% of the company’s top line.
The company expects consistent growth in the heated tobacco category, and therefore has been committed toward expanding these products. Earlier this month, the company’s IQOS 3 received authorization from the FDA for sale in the United States. The new device incorporates a number of technological improvements like enhanced battery life and quicker recharge. In prior efforts, the company started commercializing IQOS VEEV, which is its new product in the vapor category. The company also announced a partnership with South Korea’s KT&G earlier this year to commercialize the latter’s smoke-free products outside the country.
Clearly, such efforts are likely to keep bolstering Philip Morris’ revenues from the RRPs space. Markedly, the company is on track to achieve its 2021 goal of > 90-100 billion < (WOW) shipments of heated tobacco units. (end copy)
So...
HCMC is suing Philip Morris because HCMC developed the patent ("Q-Cup") that is the same technology being used in the IQOS system now being pushed heavily by Phillip Morris and was approved back in 2018.
https://markets.businessinsider.com/news/stocks/healthier-choices-management-corp-issued-three-u-s-patents-in-relation-to-its-q-cup-technology-1027675756
http://www.healthiercmc.com/news/2018/9/24/hcmc-announces-us-patent-for-its-q-cup-technology-will-be-granted-in-60-90-days
http://www.healthiercmc.com/patents https://theqcup.com/pages/patents
So for those who don’t know yet. Healthier Choice Management Corp (HCMC) are suing Philip Morris for copyright infringement on their (HCMC's) patent regarding (Phillip Morris's) IQOS - E cigarettes (now being sold like hotcakes by Phillip Morris.)
According to Phillip Morris they haven’t denied this fact by revealing they invested over 3 billion so far into marketing these new E-Cigarette products including the contested IQOS.
https://www.globenewswire.com/news-release/2020/11/30/2136949/0/en/Healthier-Choices-Management-Corp-Files-Patent-Infringement-Lawsuit-Against-Philip-Morris.html
HCMC hired the law firm COZEN to pursue these claims. I have attached some links below for further research into the future value of E-cigarettes.
https://www.cozen.com/
If Philip Morris is found guilty and liable of patent infringement it means they illegally sold 16.4 million units of the IQOS system. + the 2021 goal of 100 billion units and any other profits linked to IQOS related profits would be forfeit and owed to HCMC in some form.
That is just mind blowing
Philip Morris is moving forward with their marketing campaign despite the lawsuit even receiving FDA approval for large scale sales of the IQOS system in the United States despite the HCMC lawsuit. If Phillip Morris are found guilty the more profit they make on the IQOS system in the end just digs Phillip Morris a deeper hole as a climbing pay back price tag.
https://www.pmi.com/media-centenews/the-fda-authorizes-the-sale-of-iqos-3-in-the-us
$HCMC = 0.0001$ = David PM =$82+ = Goliath
LOOK AT THE VALUE $_$
David The Shepherd had to defeat the Philistine's and Goliath before becoming David, King of Israel.
All my posts here are pre 2021 and now look what has happened now that we are here
Source of " Additional info from Ihub"

GME Short Squeeze and Ryan Cohen DD for Jim Cramer, The (Man)Child Who Wandered Into the Middle of the GME-Cohen Movie 🚀 🚀 🚀

The Dude: It's like what Lenin said…you look for the person who will benefit, and, uh, uh...
Donny: I am the walrus.
The Dude: You know what I'm trying to say...
Donny: I am the walrus.
Walter Sobchak: Shut the fuck up, Donny! V.I. Lenin! Vladimir Illanich Uleninov!
Donny:What the fuck is he talking about, Dude?
Hello again, GME Gang. What a fun day we had yesterday! Could it continue today? Only Melvin Capital (and maybe Ryan Cohen) knows!
And an extra special hello today to our newest WSB lookie-loo, Mr. Cramer (Can I call you Jim? I’m gonna call you Jim).
Now Jim, from what I’ve been able to gather, you and your Boomer stocks and your Hot Manic Takes don’t always get a lot of love around here. But that’s not all your fault, Jim. The Paste-Eating Rocket Kids are often good for a solid meme (FYI: it’s pronounced “Mee-Mee.” Feel free to use that on air without verifying). But the Rocket Kids can be a dense bunch and they’re also often one click away from Total Financial Ruin (Quick shout out to SPCE: Pleas fly again). So you have to dig a bit in here to separate the wheat from the chaff, as someone like you actually says in real life. What the fuck even is chaff, Jim? And why do all Boomers seem to think that folksy farm-based idioms are the perfect way to conclude a thought?
Anyway. Those of us who watched your teevee clips last week where you reference your interest in WSB know that you, Jim Cramer, might be one of the Olds, but that you also Think Young(TM). https://www.thestreet.com/jim-cramestock-market-advice-moderna-boeing-fed-ftc-dec-15. So we’re going to do our best to help your young-thinkin’ brain find the Needle In the Haystack here so you can get All Your Ducks In a Row on GME. Because we know that you’re a long way from being Put Out to Pasture, and though you may be an out-of-touch millionaire prone to facile yammering, we now like you here, Jim—simply because you mentioned us and that made us blush a bit since we’re needy Millennials who just want our Boomer mommies and daddies to Tell Us They’re Proud of Us. So even though the Paste-Eating Rocket Kids here are often Buying A Pig in a Poke (Christ, please do not ever say that or the kids’ Mee-Mees are gonna fuck you up), we appreciate you recognizing that, every now and then, there’s something worth paying attention to over in this weird little pocket of the Interwebs. And since you’re actually telling your loyal single-finger-typin’ viewers to check out this WSB shitshow, and “if they’re running GME, then do some work on GME,” we assume you might actually be checking this shit out too, since all true Young Thinkers know that What’s Good for the Goose is Good for the Gander.
Now, is the GME play as solid as your recent recommendation to buy Bed Bath and Beyond? Who knows? That seems pretty stupid, and I would look it up myself this weekend but my nice little Saturday is already pretty full so I don’t know—I don’t know if I’ll have enough time. But I’ll tell you one thing: the GME play is a lot more fucking fun. Life in a pandemic is boring, but here in this weird WSB place, these kids like fun. And for all your Boomer weirdness, you seem like you still like to have a little fun in this Mad, Mad world of ours. So consider joining us here more often. A word of warning, though: if you don’t like all the dern cuss words we use around here, Jim, well that’s just, like, your opinion man, and we’ll have you know that the Supreme Court has roundly rejected Prior Restraint.
First thing’s first: we have a bit of a bone to pick with you (now there I go). The stuff you said last week about GME as the next Blockbuster was D-U-M dumb, Jim. You were a bit out of your fucking element with that. You even made our largest shareholder and conqueror-in-waiting, Mr. Ryan Cohen, send an emoji-only tweet in response, which if you know the super nice-guy Ryan Cohen like all of us do (we actually know nothing), that is pretty much the equivalent of him bringing his dog over to micturate on your and George Sherman’s rug.
Now, I myself have never been into the whole brevity thing, but I wanted to take this opportunity to get you up to speed on the GME movie you’ve wandered into. And I know you’re down with this because you told all your viewers that if WSB is talking about GME, then “make sure you know GME.” So before you say something Absolutely Mad again and Cohen sends a tweet with an even less ambiguous emoji, it’s high time that you start Making the Sure here, Jim. Just consider this to be CPT Hubbard delivering you some Orange Sunshine and turning you on to some of that Sweet, Delicious Non-Chaff Wheat you love so goddamn much.
Part 1: GME’s Bonkers-Ass Short Interest
Now, I’m going to lead with the most crowd-pleasing part of the story here (Get ready, Rocket Kids!), and it’s the one that you did not even seem remotely familiar with in your “Stay out of GameStop, Deadbeat!” rant last week. Maybe that was by design or maybe not. We’ll return to that, Jim. But the point here is: the short interest here is batshit insane. And not just your garden variety Boomer in Rolled Up Sleeves Ranting About Buying Estee Lauder While Hitting Buttons On The Beep-Bop-Boop Machine kind of insanity. Really and truly fucking nuts.
So to TL/DR this shit for you, Jim (to use the parlance of our times): GME is the most shorted stock trading today—by far. https://financhill.com/most-heavily-shorted-stocks-today How shorted? Well, the value of shares short exceeds the market cap of the company; there are currently more shares short than the total number of shares outstanding. And when factoring in the institutional and insider ownership, the total short percentage of float is nearly 300%. https://www.gurufocus.com/term/FloatPercentageOfTSO/GME/Float-Percentage-Of-Total-Shares-Outstanding/GameStop-Corp Even higher, actually, now that Cohen’s interest is over 10%. Now, I’m not a numbers whiz like you, but that level of short interest and the small available float seems pretty fucked up to me. Like: “how is that even legal?” fucked up. And just for a frame of reference, the third most shorted security right now is your beloved Bed Bath and Beyond, with a short percentage of float at a nice and tidy 69%.
Are you starting to gather why some of us in this weird little pocket of the Interwebs are a little excited about GME? You see, as u/Jeffamazon and RodAlzmann u/Uberkikz11 and others have explained in these here corners and on the twitter machine with their top-notch DD, and as I will translate to you in lingo you can dig, the short sellers got way over their skiis on this one expecting a bankruptcy in Spring of 2020 that never came. And yet, amazingly, the short interest has only increased since then—there has effectively been no covering in the aggregate and, in fact, the short percentage has only gone up. And now, on the threshold of 2021, we all sit atop a massive powder keg wondering what is going to be the thing that finally lights this shit up. And at the end of this little missive, I’m going to tell you what I think that thing might be (Spoiler: It’s Ryan Cohen! Better start getting used to seeing his name, Jim, because this dude does not fuck around and he’s not going anywhere).
https://www.reddit.com/wallstreetbets/comments/k4csaa/the_real_greatest_short_burn_of_the_century_part/
https://twitter.com/RodAlzmann
https://thecollective.finance/2020/10/gamestop-gme-a-squeeze-to-44-from-14-can-be-justified-fundamentally-100-of-the-shares-are-short-watch-out/
Part 2: GameStop Isn’t Going Bankrupt and People Actually Want to Buy Shit There
So, you foul mouthed little prick, a bonkers-ass short interest is neat and all, but why is Jim Cramer wrong when Jim Cramer compares GME to Blockbuster you might be asking yourself in the third person. First, the most obvious answer, Jim, which you should fucking know already: Blockbuster was nearly $1 Billion in debt and missing debt payments left and right when it was delisted way back in 2010. That was also when there was a bit of a credit crunch, if you recall, right after that whole Housing Crash Unpleasantness that you saw coming from a mile away and from which you made hundreds of millions of dollars due to your contrarian foresight—I’m sorry, I’m clearly confusing you with Christian Bale starring as Dr. Michael Burry, weirdo head of Scion Asset Management, which also holds about 1.4M shares of GME (You really gotta start looking into this stuff, Jim. This story is made for TV, man—and you Boomers were raised by TV and you turned out TV!). Also, in 2010 when Netflix is ripping and when Blockbuster was about to be delisted and bankrupt, an analyst noted the obvious fact that Blockbuster had “nothing on the horizon that makes it look like Blockbuster is going to be more profitable.”
https://www.reuters.com/article/us-blockbusteblockbuster-wins-debt-reprieve-forced-to-delist-idUSTRE66052720100702
But Jim, if your Blockbuster comparison has any plausibility, GameStop must have a major debt problem then, right? And yet just last month GameStop repaid $125M in debt several months ahead of time. It’s also really weird that over the past year management bought back a ton of shares, taking the OS from 102M down to just under 70M (making a short squeeze even more likely, my Rocket Children). The weirdness continues with a soon-to-be-bankrupt company holding almost $500M in cash on hand. And according to George Sherman’s “Thine Omnichannel Shalt Be The Omni-est Channel of Them All” Conference Call following Q3, by March 2021 GME will have retired a total of $500M in debt and returned $200M to shareholders through stock buy backs. I’m no expert here, and I do not presently own a Beep-Bop-Boop Machine, but that’s all pretty weird shit to be doing if you’re about to go bankrupt.
No, no – I get it: who the fuck actually looks at balance sheets anyway before spouting off about what a stock is going to do? I sure as hell don’t. That’s why I follow my man u/Uberkikz11, since that dude is a GME DD Encyclopedia and was born to crunch numbers. No, when Really Smart People make the Blockbuster comparison, it’s usually just Mouth Sounds for: A B&M Store That Used to Be Popular But Now Is Not Because Technology, QED. But here even the Really Smart People might be missing something as well. They’re right in the sense that GME must use this new console cycle window and cash influx to quickly pivot to a tech-first gaming company (more on that and our boy RC shortly!), but they’re wrong on the timing and relevance of this Super Smart Insight.
So fine, they’re doing ok on debt and cash. But who even goes to that 90s-Ass-Looking Cluttered Mall Geekery anymore anyways? I confess: in my darkest moments, as the short sellers manipulate the fuck out of this stock and I curse the names Bell and Sherman, I too have wondered this. But it turns out that, just like I have no idea why anyone listens to Maroon 5 or eats at Applebee’s, apparently a lot of people in America do shit that I do not. Crazy huh? So here is some pretty neat data showing us how out of touch we might be here, Jim:
First, when a pretty large sample size of people were recently asked the question: which of the following stores or websites do you plan to buy holiday gifts from? The #5 response from United States Americans was none other than GameStop (Ticker, Jim: GME). Only Walmart, Amazon, Target, and Dollar Store (poor people buy gifts too, Jim) were ahead of little old GameStop. That’s higher than Nike, Macy’s, the Apple Store—and double the response of Bed Bath and Fucking Beyond in every category they surveyed. Check it: (h/t to my man u/snowk88)
https://stocktwits.com/snowk88/message/260983915
That’s kinda crazy huh? See Jim, when you Think Young(TM), you really can learn something new every day. And by following our man u/snowk88 (@snowk88 over at stocktwits), I learn lots of cool shit. But guess who already knew that? The guy that wrote this bad-ass letter that identifies GME’s brand and customer data as being one of the most valuable things GME has going for it. https://s.wsj.net/public/resources/documents/RC_Ventures_Letter_to_GameStop.pdf
So now we know that Real Life People actually buy shit at GameStop here in the year of our lord 2020. But like that analyst from 2010 said about Blockbuster, there must not be anything on the horizon for GameStop to be more profitable in 2021, right?
Now, I will admit that being a bit bearish on GME in December of 2020 would make more sense if, say, GameStop were the nation’s largest purveyor of limp and half-lit pumpkin spice-scented candles and we were exiting the apogee of Shitty Candle Season. But as it turns out, GameStop is currently selling basically the most sought-after items that exist in the marketplace right now—where demand for the Xbox and Ps5 is far outpacing supply and is projected to continue well into 2021. https://www.gamesindustry.biz/articles/2020-11-17-microsoft-expects-xbox-series-x-s-shortages-until-q2-2021 I don’t really need to get into the details on that here, because it’s pretty goddamn obvious, but I think 2020 GameStop at the precipice of a new console cycle might be in a bit of a better position than, say, 2010 Blockbuster relying on the latest Adam Sandler release to lift its sagging rental numbers. But I don’t know. Millions of people don’t watch my show looking for Candid Analysis from me and my folksy man-of-the-people-lookin’ rolled-up sleeves.
Part 3: Ryan Cohen is the Sword of Damocles Hanging Over the Short Sellers’ Dumbass Heads
And now we’ve gotten to the best part. It’s my favorite part of all of this, Jim, and if you give this a little time, I think it will be yours too. You see, all that corporate bla bla bla about balance sheets and console cycles and early debt repayment and overleveraged short sellers and brand recognition is neat and all—and definitely worth a second look by itself. Maybe even a little Beep-Bop-Boop on the ol’ sound machine—I don’t know your methods. But the real thing that’s about to rip all our faces off here is the business and investment decisions of a mild-mannered wunderkind named Ryan Cohen.
Now you can revisit my prior epistle if you want to know a bit more about the involvement of Mr. Ryan Cohen in Le Affair GameStop. https://www.reddit.com/wallstreetbets/comments/kakxrm/gme_tribe_a_story_about_how_ryan_cohen_is_about/. My fly-by-night theory of his lawyer’s possible use of the consent solicitation could have probably marinated for another day, but the thrust of my argument there was that Cohen and his attorney have been laying the groundwork to come after GameStop for a while now. And that Cohen was likely emboldened by the humiliating, lame-ass CC performance by some dude with a mid-century comic-strip sounding name that we’ll all soon know only as: The Guy With the Punchable Face Who Used to Be CEO of GameStop.
But here is where things get really interesting. This is a story in the making, Jim, for fucks sake - take notes! This Monday, on December 21, Mr. Ryan Cohen filed a revised 13D showing that last week he started buying a shit-ton of shares—starting on Tuesday December 15th—which is the day after the stock price inexplicably plunged on Monday the 14th and the very same day you were yammering on the teevee about GME being Blockbuster! Instead of listening to you, however, Cohen started buying more GME shares (super-sleuth dark pool watchers u/rgrAi and u/snowk88 noticed in real-time that there was some very large accumulation taking place), which culminated in the big reveal that Cohen purchased a total of 2,501,000 additional shares last week—500,000 of which were purchased on Friday December 18, 2020 at the price of $16.02 a share. Ryan Cohen is still the single largest shareholder of GME with 9,001,000 shares in total, taking his ownership of GME above the 10% threshold from 9.98% to 12.9%. And so he apparently thinks that the floor for his investment is $16.02 per share. Is he still buying? We’ll know soon. But yesterday seemed like a little taste of what it might look like if a large buyer steps in to prevent short sellers from manipulating all of my nervous little Rocket Children here and their delicate little paper hands.
There was another thing we learned from this 13D filing: Ryan Cohen has apparently hired a new attorney and law firm. Instead of the great Christopher Davis of Kline Kaplan, now Ryan Cohen is represented by Ryan P. Nebel, a partner with Olshan Frome Wolosky, LLP. Now, if you’re familiar with my prior ramblings, you might wonder if I was a bit confused, and maybe even a little sad, at this sudden change from my man C. Davis. And you might be a little right. But then the wonder of the internet allowed me to learn a bit about these new lawyers. And holy shit, things are about to get fun.
Now, I liked what I knew about Chris Davis and he seems like a genuine bad ass activist attorney. But the folks at Olshan Frome and Wolosky, LLP are Next Level Players and really seem tailor-made for this exact situation. First off, Olshan is ranked as the top global lawfirm for Activist Attorneys. https://www.olshanlaw.com/assets/htmldocuments/Bloomberg%20Activism%20League%20Tables%20H12020.pdf (H/t @flummoxed at stocktwits). They seem to be the go-to law firm for major proxy battles initiated by activist investors. But possibly even more important is that Olshan is the same firm that represented Hestia and Permit in their successful proxy battle earlier this year to appoint two new directors to the GME Board. I’m not going into the fine details of that, because this is already a bit of a long-form Idiot’s New Yorker article, but GameStop just went through a proxy fight last year with Activist Investors Hestia Capital and Permit Capital, which resulted in two Board seats for our shareholder buds from Hestia and Permit. So, it’s reasonable to assume that the attorneys at Olshan might know their way around GameStop at this point and where the pressure points are here.
http://www.globallegalchronicle.com/hestia-capital-and-permit-capitals-two-new-directors-to-the-gamestop-board/
https://www.olshanlaw.com/resources-mentions-HestiaCapital-PermitCapital-GameStop-BoardofDirectors-ShareholderActivism.html
And if you follow u/snowk88 over at stocktwits (@snowk88)— you’d also find a wealth of DD on how Olshan rolls when entering these activist-investor-replaces-dumbass-boards-and-CEOs type disputes. To bottom line it: they get it fucking done.
https://stocktwits.com/snowk88/message/266158534
https://stocktwits.com/snowk88/message/266155112
https://stocktwits.com/snowk88/message/266153175
But what else did we learn from the 13D? We learned that Ryan Cohen is definitely not going anywhere any time soon. Specifically, the filing notes that RC Ventures intends to continue to engage in discussions with GameStop’s board “regarding means to drive stockholder value, including through changes to the composition of the board and other corporate governance enhancements." And while RC Ventures “desires to come to an amicable resolution with [GameStop, it] will not hesitate to take any actions that it believes are necessary to protect the best interests of all stockholders.”
I really like that last part, don’t you? And although I thought his November 16th letter was pretty goddamn clear, this 13D just ratcheted up the transparency level here. In sum, Ryan Cohen has all of our backs and he’s going to replace this Board and Sherman with people that are on the level and that will help implement his vision.
And now seems like a good time to return to those “Ryan Cohen: Boy Genius” articles that were definitely NOT part of a well-coordinated pre-hostile takeover media campaign initiated earlier this year. I think there might be a few things in those articles that Mr. Cohen wanted all of us shareholders (as well as the short sellers and the Board he’s about to replace) to really and truly understand. Recall also that Cohen is not one for diversification or for playing it safe. So here’s a few choice nuggets for you to ponder:
***
Bloomberg, June 2020: https://www.bloomberg.com/news/articles/2020-06-05/chewy-founder-cashes-out-bets-on-apple-wells-fargo
· "It's too hard to find, at least for me, what I consider great ideas," he says. "When I find things I have a lot of conviction in, I go all-in."
· Cohen uses the word “conviction” a lot. He says it’s something he learned from his father, who ran a glassware importing business in Montreal where Cohen grew up. “He taught me how to block the noise from the masses,” says Cohen. “To have a point of view and have conviction and not waver.”
· He wouldn’t, however, recommend his [non-diversified] investment approach to everyone. “You need to have the temperament to block the noise,” he says. “Sometimes it feels like a roller coaster.”
· He likens his obsessive focus on building Chewy to his approach to stock picking. "I don't want to swing for a single," he says.
***
You hear that, Jim? Our man Cohen likes idioms too! But fuck those farm idioms, Jim – we’re upgrading to the Sportsball kind now. So what’s the takeaway here? I’d say that Cohen has his Eye On The Ball and that it’s time for all short sellers and the Board to Throw in The Towel because Ryan Goddamn Cohen likes to Take the Bull By The Horns and will ensure that he Hits a Homerun for shareholders that believe in his vision.
Here’s a few more things Mr. Cohen wants all of us to know:
***
Forbes, August 2020: https://www.forbes.com/sites/zackfriedman/2020/08/16/entrepreneur-chewy-founder-ryan-cohen-shares-his-best-advice/?sh=41e1370e5840
· “For me, each no sounded like they just didn’t understand my vision. It was frustrating at times, but never discouraging. Those ‘no’s never made me doubt my strategy – it was the opposite. I was motivated by all the rejections and they just got me fired up.”
· “I understood that thinking big was likely going to be misunderstood along the way. I’m contrarian by nature, so being misunderstood often validates what I’m doing. It wasn’t until Chewy boxes were on doorsteps across the country that the bulk of investors started to recognize our formula.”
· “[M]y biggest risk would have been not taking risk. The risk of going head-to-head against Amazon. The risk of insourcing fulfillment. The risk of building a company in Florida rather than a popular tech hub. The risk of spending $3 million a month on TV ads, more than Home Depot HD -0.1%'s budget. The risk of hiring expensive executives even though we weren’t profitable. These decisions were some of the most controversial and required me being comfortable betting against conventional wisdom, and were often contrary to the advice of my board. Suffice it to say, I was not the most popular board member.”
· “Dad never swayed when he believed in something. I never compromised my vision, regardless how many investors turned me down I was not going to give up on building Chewy into the world’s biggest online pet retailer. I love to be challenged, and I’m flexible on details, but I’m never willing to give up.”
***
Goddamn it, Ryan. I was done having children but now you’ve forced me into getting back on that train just so I can name this future child Ryan Fucking Cohen. Thanks a lot, asshole.
But to return to my point: are those the statements of a man that seems likely to walk away at this point? Or is Cohen trying to tell us all to get ready because he is going All In on this shit?
So where does this leave us? After a huge week where Cohen buys 2.5M more shares and then the SP skyrockets to $20 yesterday on that news? Well, this is where I want to tip my cap to my man Justin Dopierala over at Seeking Alpha and allow him to conclude this section. He, along with his pal Dmitriy Kozin have been pretty clear-eyed on all this shit for a while now and they both deserve some credit. And I know I gave my main man Justin a bit of a hard time in my last novella, but the dude is sharp as hell and helped a lot of us see the forest through the trees here. And you should also definitely invite him to join your poker nights (seriously: check out the dude’s tweet in response to our own Rod Alzmann’s introduction of the #WeWantCohen hashtag right after the Q3 call debacle). https://twitter.com/DOMOCAPITAL/status/1336446055685230592. You have no comment on a potential takeover involving Ryan Cohen, Justin after your hour-long googly-eyed call together? Can’t believe you’re just preemptively leaving the WSJ and Bloomberg hanging like that. Justin, I love you dude, but if I’m holding pocket Kings I’m folding after that tweet because that twinkle in your eye lets me know you’re about to drop two Aces on my ass.
Anyway. Here is what our man Dopierala thinks might happen here soon (and he called this way back on November 17th- and sorry - no links here, per the mods, as apparently no Alpha must ever be Sought from these parts):
I think a very likely outcome at this point is a majority slate next shareholder meeting where Cohen takes over BOD and then makes himself CEO. A majority slate proxy battle would require all institutions to call in shares and would force a squeeze.
We’re intrigued, Justin. Please continue:
If Ryan Cohen successfully negotiates a purchase price with the Board then the shareholders will have to vote on it. Unlike the proxy battle where Hestia and Permit were running a minority slate of directors, an offer to purchase GameStop would force institutions like Vanguard and Blackrock to call in their shares. By doing so, the shorts would be forced to close out their positions and GameStop would finally have the greatest short squeeze of all-time. Ironically, Cohen could use this opportunity to sell all of his shares and use the proceeds to entirely fund the acquisition of GameStop going down as the first person in history to acquire a billion dollar company... for absolutely nothing. In fact, his acquisition price would be less than zero.
And now is when I get to speculate on what I think is going to happen here. But I do not necessarily think Cohen is going to put an offer to buy GME to take private. That would definitely trigger a MOASS, but I’m not sure I see it given the attorneys he’s hired and his recent buys up to $16 and the amount of cash that would take. Like Dopierala’s first comment, though, I think Cohen is going to nominate directors to replace nearly the entire Board of Directors with a vote happening at the annual meeting and once that Board is in place, they’ll appoint Cohen as CEO. And as Justin notes, if he nominates a majority slate of directors, shares will have to be called in to vote. And this vote and proxy battle will make the prior minority slate Hesita/Permit battle, and the tiny short squeeze that took place when that happened, look tame by comparison.
Now everyone: get your calendars out. Because the date to nominate directors here is in Mid-March, and my super-smart corporate lawyer buds inform me that it’s standard practice to file about 7-10 days prior. So, if this actually happening, we should be seeing something on this by early March.
But even though early March is now the mark on the wall, today’s insane price action caused me to think about all of this a bit harder and speculate a bit more. And a major h/t to my buds on the stocktwits board, especially u/rgrAi (@amarbar) for all the sharp analysis on this. But if you were Ryan Cohen and you knew this company was hugely undervalued and you had a high level of CONVICTION here and also knew you needed shareholder votes to sweep out these dumbasses and implement your vision—then how would you play this with the short interest here as crazy as it is? I’d keep buying. Why? Well, lots of reasons, you smart alecks.
First, so I have more guaranteed votes (duh?). Second, so that when the building starts burning and short hedge funds run for the exits they find that a mild-mannered Millennial with super-good ideas has sealed off all the doors and windows. That’s gruesomely delicious, isn’t it? Why else, CPT? Well, finally, and maybe most importantly, because I would want to excite and delight all my fellow shareholders by triggering a slow-burn short squeeze, raising the SP significantly, so that I can once again make the point (as he did in the Nov 16 letter) that the incompetent management that caused a HUGE drop in SP following that utterly incompetent Q3 call and the shelf registration, had nothing to do with the SP increase that again happened once Cohen announced his intent and started buying. Not the console cycle, not the cost containment measures, not the buybacks and not the early debt reduction. Nope: rightly or wrongly, shareholders will see Ryan Cohen buying shares and the corresponding SP increase and everyone—especially all new buyers who are delighted at their good fortune and swept up by Ryan Cohen Fever 2021—will start getting #WeWantCohen tattoos on their ass they’ll be so happy. And all of us, newly enriched by Ryan Cohen’s Big Canadian Balls and tactical brilliance, will crawl over glass to vote for him over The Boomer Artist Formally Known As GameStop’s CEO. I could be very wrong on this last point in particular, but if we start seeing 13Ds drop here shortly, things should get very fun very quickly.
Part 4: A Return to Our Short-Squeeze-to-Da-Moon Discussion: Who’s Side Are You Fucking On, Jim?
Now, Jim, given the fast friendship we’re creating here, and all we’ve been through over the past 5000 words, I hesitate in bringing this up. But we’ve all seen the video, Jim. You know the one I’m talking about. Yes, the one where you actually tell the truth about how short selling hedge funds manipulate the market to knock down the price of perfectly good securities that many hard-working people invest in—many normal-ass people all assuming they wont ever have to Point Where On The Dolly The Invisible Hand of the Economy Touched Them. But that’s not life now is it Jim? And fuck those poor-ass rubes for not knowing how to play the game with you sophisticated Masters of the Universe, amirite?
https://www.reddit.com/dashpay/comments/93evx4/jim_cramer_reveals_dirty_tricks_short_sellers_use/
https://dealbook.nytimes.com/2007/03/20/cramer-market-manipulato
So where are you in this whole GME/Cohen story, Jim? You candidly (gleefully?) acknowledge that a prime strategy that shorts deploy is to spread negative rumors that are then amplified by Big Smart Trustworthy Financial Media Titans like yourself to shake out unsophisticated retail players like my Rocket Kids here—who because of their tiny paper hands and you mean short selling brutes often subsist on paste and paste alone.
So for this particular security, are you the one helping with the manipulation and actively creating the “new truth” or are you just one of the Useful Idiots that these short sellers use to manipulate with an anodyne, TV media-ready comparison like: GameStop Is The Next Blockbuster? And how in the fuck does this fit into your Think Young(TM) project, Jim? Because if there is one thing that we over at WSB fucking hate, it’s a bunch of Manipulative Short Selling Boomer Fuckwads. Why on earth would a hip Young Thinker like you want to be included in that crew, Jim?
And I know we’re all friends here now, Jim, but I need to push back a bit on some of what you said in that video in such a cavalier whatareyagonnado manner. So if I understand you, short and distort and fomenting negative reactions from retail players based on deliberately false narratives is illegal, but still easy as fuck to do "because the SEC doesn't understand it." But you fucking do understand it, Jim! So why are you helping those short and distorters break the law here? Why are you being such an obtuse dumbshit? Just check out what happens to the borrow rate and short selling every time there is any good news for GME:
https://stocktwits.com/Slantedangles/message/264519950 (h/t @slantedangles). This manipulation isn't just happening with GME; it is happening everywhere. It’s baked into the cake. And that is pretty fucked up that we all just accept it because whatareyagonnado.
I think that one thing that those of us who truly do Think Young(TM) have a hard time understanding is at what point in your lives do you Boomers all finally come to realize that it’s maybe time to stop playing the game like you have been? What point do you finally have enough where doing the right thing matters more than getting paid? Maybe start by telling the truth more often—and maybe don’t go out of your way to help those corrupt-ass hedge fund managers who continually fuck over average people merely because they were stupid enough to believe you all. What contempt you Masters of the Universe have for all of them—for all of us. There is a bigger story here on GME and this out-of-control short interest (naked shorting, counterfeit shares) http://counterfeitingstock.com/CS2.0/CounterfeitingStock.html than even Ryan Cohen and the inevitable short squeeze we’re about to witness here. And it begins and ends with people like you and Melvin Capital and Bank of America not giving a fuck about the rules while thinking you’re smarter than the rest of us who do—but who lack power to do anything about it. And you know what? Maybe you are smarter than us. You certainly know how to play this game pretty well, as that video shows. But if I know my old school 1980s movies like I think I do, this is usually the part of the story where the rag-tag kids from across the tracks come over to show you hubristic rich fuckheads what happens when you fuck a stranger in the ass.
Now I myself have never dabbled in pacifism, Jim, so this isn’t too much of a stretch for me, but seeing that video of yours and seeing the insane short interest and all the manipulation here makes me want to burn the whole corrupt system to the ground—while barricading the doors to trap in those arrogant-ass short sellers who lie and cheat and distort to profit off average people. And though I’m certain that this larger battle is not driving him, maybe that result is one that Ryan Cohen wouldn’t mind too. Though he’s a polite Canadian and would probably just let everyone know that he’s not really mad, just disappointed. But me? I’m an Angry American and I say: Block the fucking doors and windows and light that shit up.
So maybe this epistle will be useful for your Think Young(TM) project and cause you to reflect a bit more on what’s really going on out there with this whole GME thing and the likely illegal shorting that has driven the short percentage of float to these insane levels, drawing in new retail shorts too stupid to know what’s even happening. Or maybe it wont cause you to reflect in the slightest (count me as one of those cynical types that see your overtures to WSB as a transparent play for greater market share from the Young Crowd since your old-ass audience is dying and/or switching to bonds). But in a few months when all the Billy Ray Valentines and Louis Winthorpes assembled here are toasting each other in stupid shirts on a white-sand beach somewhere, we do not want you to look back on your knee-jerk boomer-ass dismissal of GME and your Useful Idiot blathering with that same tinge of regret and longing you feel when you look at a pre-Client 9 picture of you and your old roomie: warm-toes-and-hosiery-enthusiast E. Spitzer, Esq.
In conclusion: GME = Blockbuster comparisons are for Simps and Corrupt Short-and-Distorters. Don’t be like them, Jim. And to my Rocket Children: the only weapon we wield in this stupid game is Diamond Hands with a float like this. Toughen the fuck up.
And Happy Holidays everyone.
--CPT Hubbard
TL/DR: Jim Cramer likes farm-based idioms and apparently being a useful idiot to scummy short selling hedge funds. DD on the GME turnaround is solid and overleveraged short sellers should be shitting themselves. Ryan Cohen, our polite, hard-working Canadian benefactor is about to rip all our fucking faces off and trigger a MOASS. Probably even by early March, if that time is good for you (he’ll text before he comes). And fuck infinite regress: It’s rockets all the way down here. 🚀🚀🚀 Now: diamond hands, motherfuckers.
**This is a shitpost and is only to be used as investment and life advice for Mr. Jim Cramer, Esq.

Started a content marketing agency 4 years ago - $0 to $3,333,686 (2021 Update)

Hey friends,
My name is Tyler.
Back in 2016, I quit my full-time job running growth and marketing for a venture-funded startup. I became a full-time freelancer focused on content marketing and SEO.
Later that year, I outgrew my personal capacity for freelance work. I also realized that most of my clients really needed an end-to-end solution for content marketing. So my freelance work grew into an agency called Optimist.
In the first 3 years, we grew the company to about $1.5MM in ARR.
It’s been a fun journey:

Each year, I’ve shared lessons and progress as we’ve grown, trying to document a transparent look at our victories and our failures. I've gotten tons of feedback, questions, and messages over the years. It's been one of my favorite parts of growing this company.
Needless to say, 2020–year 4–was easily the most challenging so far.
So, sharing the lessons and progress will be a little bittersweet.
But, I’m nothing if not transparent.
So let’s do it.

Optimist Year 4 - 2020

Here's our monthly revenue from January 2017 to January 2021.
As you’ve all probably experienced.... 2020 was a weird fuckin year.
For Optimist, it was a year of both ups and downs.
Fortunately, we work primarily in the tech space. So many of our clients and potential clients were less effected by the pandemic and shutdowns than other sectors. On the whole, we had a stronger year than I imagine many other marketing agencies experienced.
Nevertheless, we suffered some setbacks—and I learned some valuable lessons that will hopefully make us stronger and even more resilient in the future.

How Optimist Works

First, an overview/recap of the Optimist business model:

We operate as a “collective” of full time/professional freelancers
Everyone aside from me is a contractor
Entirely remote/distributed team
Each freelancer earns $50-75/hour
Clients pay us a flat monthly fee for full-service content marketing (includes research/strategy, writing, design, and content promotion/outreach)
Packages range in price from $7-20k/mo
We offer profit share to everyone on our core team as a way to give everyone ownership in the company

Second, a breakdown of Optimist by the numbers, as we stand now:

$3,333,686 in total revenue to date
16 clients on retainer
$120k MRR
24 "core" team members (freelance/contract)
46 additional freelancers in our community
$82,948 paid in profit share in 2020
Gross profit margin ~40%
Net profit ~25% before paying my salary and profit share

The impact of COVID on the business

I don't believe in the idea that "everything happens for a reason."
Frankly, I think it's a bullshit cop-out for trying to avoid internalizing or processing all of the bad stuff that happens—sometimes at random. It's a mental trick for putting it out of your mind rather than examining and learning from the experience.
Instead, I think, "something good can come from everything."
This is an active mindset.
It implies, first of all, that there is still a potential for something positive to come from even the most horrible things that happen. But, it doesn't happen automatically.
Just because something good can happen does not mean it will.
It's up to you to figure out how to take something negative and find the opportunity.
I've tried to remember that throughout 2020.
Obviously, the most notable thing from this year was the COVID-19 pandemic, which killed many businesses and hurt many of those it didn't kill.
We were not immune.
In the early months of the pandemic, we lost several clients.
All told, I feel more than fortunate.
Nevertheless, we spent almost every month of 2020 below our target of $125,000 in monthly revenue. Over the summer, we dipped below $100k in monthly revenue for the first time in about a year.
We're only just now getting back to the level of revenue where we ended 2019.
Unsurprisingly, this reality drove most of my learning from the year.
I think something positive can come from the tremendous challenges that we faced over the last year. It's my job to figure out how to make that happen.

#1 - Entrepreneurship is responsibility

In my update last year, I wrote extensively about my need to let go of some responsibility. I explained my plan to double-down on our model of ownership—asking the team to step up, take on more of a role with our clients, and play a bigger role in our operations.
I’m extremely fortunate that the team responded.
Many people took on new roles, picked up new skills, started helping to handle stuff that usually landed on my plate, collaborated more independently with other team members, and otherwise lightened my load.
This was a huge win.
It saved me tons of time and created more space in my days for focused work rather than constantly responding to questions and requests from across the team.
But, when COVID hit and our revenue dipped, we had to "let some people go."
I’m putting that in quotes because our team is comprised of freelancers, so it's not quite the same as cutting a FTE. But, we no longer had enough work to support our full team.
I had to be the one to break that news.
I had to make the decisions about who would keep work, who would lose work, and what the team would look like moving forward.
Deep down, I think that part of me hoped this collective model would shield me from some of the responsibility that comes with running a business. I thought that working with freelancers meant that it would be easier to manage our capacity without hiring and firing.
I thought I could have my cake, eat it, and avoid the calories.
But that just isn’t the case.
When you run a business, you have a lot of responsibility. Your team, your customers, and your partners all place a lot of trust in your abilities.
They depend on you.
And letting people down sucks.
I don't know that I have any specific action items that came from this lesson. But, I think it's important to sit with this realization for a moment. Remind myself that there is responsibility here—that people depend on me and our team.
No amount of "business model innovation," delegation, or restructuring will change this simple fact.

#2 - Growth can be the safest bet

We pride ourselves on keeping clients around.
We do good work and deliver results.
In fact, I did an analysis that found that near the end of our third year, our clients had an average tenure of about 21 months.
But, every client will leave eventually.
Some clients churn quickly because there is a problem with the fit or the budget or the expectations (we've done a better job of qualifying, which has reduced this).
But, even the best-fit clients will eventually leave us for one reason or another:

They outgrew us and decided to in-source the work
Our contact left and the new leader wants to try something else
Our contact got a new boss who wants to try something else
They feel like we've built enough momentum that they can "coast" for a while and maintain growth
Change in budget or prioritIes
They got a wild hair up their ass

This is one of those realizations that you’d hope would be obvious from the start.
In my case, it only took 4 years.
But, when you realize this is a rule of the business, it’s actually sort of liberating in a way. It reminds you that while losing clients is never easy, you can be smart about running the business and plan for the inevitable.
You can be strategic.
What I realized this year is that our business needs to operate under the assumption that clients will eventually leave and that must inform our entire business strategy.
We began the year 2020 with what seemed like a simple goal.
We didn't want to grow.
After hitting our revenue goal in 2019, we wanted to stabilize the firm at our current size and revenue, focus on operations, and then expand into new lines of business.
That didn't happen.
Instead, we shrunk after COVID hit.
But the lesson here isn't really about COVID, which was (I think) entirely unpredictable. It was the nature of how unpredictable things happen—and what we can do to hedge against those risks and stabilize the revenue and cash flow.
What I found out is that it’s actually more difficult to tread water than it is to continue growing.
When we were at our max, we would have new inbound inquiries. We'd have to put those deals on hold because we didn’t have the capacity for new work.
Of course, when we later had a client leave, most of those opportunities had moved on.
So we’d be left with a dip in revenue.
On the flip side, when our revenue was down, we’d often receive several new client inquiries who wanted to start right away. That led to a time of fast growth, strain on the team, and sometimes a bit of chaos.
This wasn't sustainable.
Honestly, it just created unnecessary stress.
What we need instead is controlled growth and a strategy that focuses on meeting capacity and demand—a pipeline.
So, our goal has shifted. Rather than trying to maintain the size and shape of Optimist as a $1.5MM ARR agency, we're planning to continue to grow and scale.
Rather than taking leads as they come, we're planning to develop a queue for upcoming work—onboarding new clients as quickly as we can reasonably kick-off (~2 per month). And signed contracts will reserve a spot in the onboarding queue for upcoming months.
As I'm writing this, we have clients slated to onboard in February and those in our sales pipeline would be looking to kick off in March or later.
There's still some risk that those opportunities will dry up in the interim. But, between having a more predictable pipeline of work and plans for onboarding, plus a clear timeline, I think we can stabilize our ups and downs. Even if those clients do walk away because of the lag time to kick-off work, we'll have a couple of months to fill that "slot" with a new inbound inquiry.
Ideally, we'll be able to see future new revenue for months into the future.
Of course, we then have to be prepared and able to scale our team and operations to deliver on this rate of growth.
Given this plan—which sees us potentially bringing on 24 new clients in 12 months—and even an aggressive projection of churn over the course of the year, we'd still be looking at 25+ clients by the end of 2021.
This presents a whole new host of problems, which is what drives the next lesson.

#3 - I'm the f*cking bottleneck

I've been thinking about how much of our plan from last year—the one where we'd hit our goal of $125k MRR and then hover—was driven by my own ego.
In theory, the team agreed that this sounded like a good plan. But, I also sold them on the merits not outgrowing our model, maintaining a flat structure, and keeping things steady versus dealing with the ups and downs of running a traditional agency.
What I really sold them was the idea of keeping myself at the center of our client work.
The main reason we needed to maintain our size in order to keep things working is because I still wanted to have my hand in every single client engagement. I wanted to shape and own the strategy for every client that walked through the proverbial front door.
I wanted Optimist to be about me.
I was the one holding our team back.
I was the bottleneck.
In recognizing the safety that comes from growth, I've had to confront and challenge this directly. I've had to take a hard look at why we couldn't grow beyond our current size. I had to reflect on which parts of the business would break once we moved past this line we'd drawn in the sand.
Guess what I found?
Everything about the agency is scalable except for me.
Yes, we'll need to expand the team. We'll need to onboard and train people to work within our systems. We'll need to invest a bit more in education, reporting, building feedback loops, and developing the talents of freelancers in our core team.
But, none of those things should stop us from growing.
Our collective freelance model was, by design, built to be scalable and non-hierarchical.
That was the whole point of Optimist in the first place.
But I was focusing too much on my own ego and my own role in the daily work versus my role as an architect of the system. Eluding back to my goals to offload myself, delegate more, and extract myself from the day-to-day client work, my vision was still been too narrow. I'd thought this meant that I'd have more time to do keyword research and build content calendars.
But, if I'm still the owner of this ongoing client work, then we can't truly grow.
I'm the f*cking bottleneck.
So, I'm no longer thinking about ways to split up my time more efficiently. I'm not thinking about how much of the strategy I can still own while scaling to meet the needs of every single client.
That doesn't make sense with our new direction.
Instead, I need to replace myself—fully.
We're hiring a new role at Optimist — Content Marketing Lead / Account Strategist.
By the end of the year, I should no longer be the best content marketing strategist on our team.
In fact, my hope is that I am no longer directly involved in 80% of our client delivery.
My plan is to play a true "director" role—providing input, guidance, training, and support to a new team of strategists that can scale way beyond my capabilities.
This is another one of those, "duh" moments that has been largely misdirected by own ego. Of course we should replace me to maintain a path to growth. Of course our clients will receive better service with more dedicated strategists versus one person trying to hold it all together.
Of course this was the path forward for Optimist.
But, again, I was the bottleneck—both literally and figuratively.

#4 - Using the business cycle as a competitive advantage

My final big lesson from 2020 was another thing that should have been obvious sooner.
It's about using the rhythm of our business cycle as an advantage rather than a challenge.
Our business operates on a quarterly cycle.
Every 3 months, we spend approximately 4 weeks focused on analysis, research, and strategy for each of our clients. We put together a plan for the upcoming 3 months,. Then we execute that plan before repeating the process.
This means that for about 1 out of every 3 months, I've traditionally been heads-down on client strategy work.
Everything else got put on pause.
If I wasn't able to pause those projects, then it became overflow work—I'd quickly find myself working nights and weekends to get client work done on top of whatever else I had already committed to finishing.
In other words, 4 months of the year sucked for me, both personally and professionally.
Unsurprisingly, it also cascades to the team.
I'd be perpetually behind on projects, leaving others behind, throwing off our calendars, and leaving people without work while we tried desperately to catch up.
What a stupid system this was.
Of course, a big part of solving this is removing myself as the bottleneck. We've discussed that.
But, the other piece of the solution is to simply recognize and understand this cycle.
There will be an inevitable busy period dedicated to planning and strategy.
Other work should be planned and scheduled around this period—not on top of it.
By simply mapping out the calendar for most of the year, I can shape my other projects, commitments, and even meeting availability around the time I'll be spending on client strategy work. I can structure my quarters as weekly or bi-weekly sprints, completing other projects in the time between these periods.
As an organization, we can also plan our growth around this time, too.
In those "down" months, we can focus on:

Onboarding new clients
Finding, onboarding, training new freelancers
Team events and retreats

Inversely, we can put these time- and focus-intensive pieces on hold while we're in the midst of client planning, avoiding the overlap that leads to crunch time and extra stress.
All in all, I think 2021 is going to be another year focused on stabilization.
But, in a different way.
Rather than trying to tread water for the next year, we're going to focus on putting out the fires that crop up—and getting better at putting out future fires.
We're going to focus on preparing for growth rather than dealing with it in real-time.
And ultimately, we're going to focus on resilience.
---
Alright friends — that's my update for 2021.
As always, I'll hang around to answer some questions.
Feel free to share your thoughts, feedback, etc, and I'll pop in throughout the day.
If you're interested in following the Optimist journey and the other projects I'm working on in 2021, you can follow me on Twitter.
Cheers,
Tyler

[Barterverse] Wealth of Planets 7: Deja Vu

RoyalRoad
Index
Previous
Next
Galactic Union HQ
"Emergency Session 18 of the Galactic Union, for the record," Secretary General Amanda Wilson said as she looked solemnly around at the hundreds of creatures in the chamber. At first, the Galactic Union headquarters were located in New York City, sharing spaces with Earth's United Nations. Then, as many other planets joined it, the UN General Assembly Hall became too small.
A new, larger facility was built at Galactic Peace Island, formerly known as Navy Island, a previously uninhabited island on the Niagara between the US and Canada. The new assembly chamber was large enough for every planet to have one permanent seat. Though some would choose to participate in its proceedings virtually, every one of them had visited its spacious halls. The structure itself represented their sacred and collective agreement to resolve their differences together, to face big challenges together, and to guard the interests of all sentience.
This was where galactic slavery was banned. This was where the first interspecies anti-piracy military ship was commissioned. This was where the ambassador of Ribb had come to humbly beg to be allowed to rejoin the galactic community.
For humans, its location and the extreme technological requirements needed to quickly construct the large hall also served as a convenient reminder to the galaxy of the importance of the species that hosted and built it.
"We have received a special petition regarding the issue of sovereignty over a member planet. I yield my time to their representative, joining us via virtual FTL comms," Amanda continued, pointing at the massive viewscreen above her.
The screen cleared, and a large parrot like face appeared with intricate red and black paint adorning its features.
"Hello Union members, my name is Mollikutta. I am the former Governor of Zakabara Second, and I am here to represent the interests of my people," she said calmly but loudly. There was a hubbub in the assembly hall. Zakabara already had a representative! Eyes began drifting towards the stunned Popptaw at the front of the chamber.
"My people of Second split off from Zakabara Prime many thousands of years ago. We have developed a distinct culture, and distinct interests. Our people no longer wish to accept the jurisdiction and administration of our planet from Prime. We would like to ask the Galactic Union to grant us sovereignty over our planet, our resources, and our space."
A loud squawk broke through the shocked chamber. It was Popptaw.
"This is ridiculous! Zakabara Second is and has been a colony of Zakabara for all of our history! I am the true representative for all of our people, all of our species, and I demand that this pretender be ignored by this chamber from here on out!"
The older species were nodding or agreeing silently. After all, Zakabara was not the only species that had a colony or two. Some younger species were looking to develop their own, and their ambassadors were now suddenly worried about whether they'd retain control over them.
Mollikutta was undeterred and continued, "unlike the representative from Zakabara Prime, I was chosen to lead our people with a majority voice vote last night."
It was not easy convincing the crowd to let her stay on with a promise of facilitating independence, with her being the symbol of the Primers on their planet for months.
The flashy entry of the humans in their helicopter at the palace grounds did the trick. Mark promised the mob elections and everything. Humans had a lot of credibility in the galaxy, with their cultural and economic exports.
At this point, there was more whispering and even some gasps in the chamber. They were all familiar with the concept of electoralism; that was how Earth and the GU conducted business, but few other species practiced it internally.
Mollikutta continued, "my people deserve the right to determine the future of our destiny, not to be treated as second class citizens by an oppressive regime from a faraway planet that does not understand our people or our problems!"
The undecided chamber looked to the great powers of the galaxy to see what they had to say.
Amanda spoke up simply, "the people of Earth stand with the people of Second."
Seeing this, Gubarak, the ambassador of Gakrek quickly followed, "Gaks stand with the people of Second."
"The Zeepils of Zeep-zep support the Seconders' right to self-determination."
Finally, an electronic tally showed an overwhelming majority of support for the independence of the people of Zakabara Second, with many older species choosing to abstain instead of casting their lot with Prime.
A subsequent vote gave the Galactic Union the powers to oversee the transition.
As Popptaw stormed angrily out of the chamber, Mollikutta wasn't sure which she found more beautiful: knowing that her people had a brighter future ahead of them, or watching the middle finger that the galaxy had just shown their other oppressors on Prime.
Construction Site 1, Gophor Spaceport
Grayin's heart sank as she saw Rey and Enrico walk over, hand in hand. She had hoped that it would take them longer to figure out what she was doing here and to start asking questions, but the growing pile of material and chopped wood frame in the lot she'd chosen wasn't easy to ignore.
After all, they were easily visible from their neighboring restaurant. And nobody liked competition.
"Hello Rey, hello Enrico" she said timidly, not wanting to start a confrontation this early in the business.
"Good morning, Grayin," Rey greeted politely, "and N'har. How are things going? Looks like you guys are building some kind of a permanent structure here. Does this have to do with the spaceport?"
From the familiar look on her face, Grayin knew the jig was up. She couldn't lie, so she tried confidence. "We're building a new restaurant building here. It'll be a two-story one, just like yours, except we'll also have a front patio. Like one I've seen on a magazine from Earth."
Rey smiled broadly and said, "that's very nice. Good luck with that! And don't go anywhere, we'll be right back in a bit."
Ah, shucks! They're gonna go get that security guard that they hang around. We should have thought of that, she thought. Maybe if we hired a couple of them, they wouldn't be messing with us.
About an hour later, to her surprise, Rey and Enrico came back not with Grob, but with a plastic folder with a stack of papers held in it.
"These are the contact information for the construction contractors we had on Earth for the more advanced issues we had when we were building our restaurant," Rey said. Handing her the folder, she added "and we've got our blueprints in there in case you need inspiration, as well as some interior design ideas. And let us know when you need help with water, electricity, and waste management."
"Huh?" Grayin was dumbfounded.
"You said you're constructing a new building here, right?" Enrico asked affably.
"Yes. But why are you helping us?" she asked suspiciously. Surely, they couldn't be naive enough to not recognize the obvious site of a future competitor, right?
"Oh, we're not worried about the competition if that's what you're thinking," Enrico smiled. Then he added, "besides, N'har here helped us out a bunch when we were building our business." He went over and patted the stunned N'har on the shoulders. "It's about time we returned the favor."
Grayin was not sure if she'd gone crazy, or if it were just these two humans. Perhaps it was both.
They were not crazy.
Having gone to Hamburger University, Rey was familiar with the clustering effect. Enrico, who had been to a street lined with restaurants, also intuitively understood its existence. Hell, even the food vendors at the spaceport market knew this subconsciously.
Businesses tend to cluster. For a long time, economists ignored this tendency because economists were generally not businesspeople. In the 1980s, as the field of business strategy really began to hit its stride, some of them started to take notice and study the effects of clusters.
Why do businesses open up next to each other even though they'd face the stiffest competition there? As it turns out, the reason mostly has to do with economies of scale.
When you ship something, like say napkins, to a hundred restaurants on a hundred different streets, it is costly. Far costlier than shipping napkins to a hundred restaurants on a single street. Apply that to every consumable good or maintenance need of every restaurant, and what ends up happening is that the cost of doing business in a cluster turns out to be much lower than outside. Sure, there may be strong competition, but clusters also increase foot traffic, which increases the overall pool of customers.
This also happens on the labor side. That's why so many IT workers live in the Silicon Valley, why so many prospective actors and actresses live in Hollywood, and why so many jewelers live in Antwerp. In the even longer run, successful clusters make successful cities, and successful cities rake in profits for its businesses.
In the case of Gophor, Rey and Enrico could not wait for the spaceport to develop a food court, with an even cheaper supply chain for imported goods from Earth. Additionally, the only logical move for these new buildings later on would be to hook up their utilities to their infrastructure. That would not only decrease their own cost but possibly allow them to earn a profit off that early investment.
And it was certainly going to happen sooner or later, so why not maintain a good relationship with the folks who were about to maintain a large workforce and potential customers in the area?
They offered the working Gaks some free ice cream (luckily, the ice cream machine was not broken that day), and went back to work.
Four Months Later
Grayin designated her new buildings Site 1, Site 2, and Site 3. They lined up side-by-side next to the next to the existing McDonald's building. Because many of the construction Gaks who were on her projects also worked with Rey, they were familiar with many of the human invented building techniques that were required.
They could employ more workers with their lower pay, and after a short four months, the exterior for Site 1 was mostly completed. After a risky operation that shut down McDonald's itself for a weekend, they also managed to hook their building onto Rey's "utility company".
After they celebrated the building's completion, the first thing they did was to ask Rey and Enrico whether they had an idea who on Earth would be interested in their new building. For reasons she and N'har still could not understand, the humans had been genuinely helpful and seemed utterly honest about their intentions to help her succeed.
"Hmmm," Rey thought out loud when they asked, "there are a few restaurants that could really round out this spaceport. I think your best bet for the most money would be some kind of a luxury or fine dining establishment for traders."
"Yeah, when we started, there were barely enough traders to make us profitable on them alone," Enrico completed her thought. Then he explained, "we got lucky that our business is cheap enough for locals. Now most of our business is with Gaks. But with how many bigger ships are coming in with larger crews, I think you could definitely sustain a restaurant that charged higher prices for less volume."
Grayin had seen human commercials for fine dining restaurants. Big empty spaces between tables, fixed courses, and very fancy service. She wasn't sure that it would be the right business model for Gophor, even with the increase in foot traffic. And she knew next to nothing about starting a restaurant business. But she didn't have to run it. She just had to rent it to someone who would.
"Okay," Grayin decided, then asked, "so who would you suggest we contact for someone who would be interested?"
Rey thought about it for a while, but she realized she didn't know. Her contacts really didn't extend much beyond the company she'd work for her entire life. She replied honestly, "I don't know. You could contact Izzy, who we got to handle our rental deal, and ask her if she could give you a recommendation. That's what I'd do."
After getting Isabella's contact information, Grayin and N'har thanked them and started strategizing the call.
Chicago, Earth
"It's another alien trying to rent us property on line three, Izzy," her secretary said to her calmly, as if this was something he did every week.
In a way, it was. Thousands of planets had seen what happened on Gakrek with Rey's franchise. If they were not innovative, at least they could copy. Isabella had to reject many good offworld deals that just didn't have the right infrastructure or didn't make business sense, especially on the smaller spaceports.
She did pretty well for herself too. New corner office. New secretary. New frequent flier card for the recently opened Galactic Express chartered flight company, for when she needed to inspect prospective renters or sellers.
"From where?" she asked smoothly. She had one of those galactic maps projected onto her office wall, with flags on some of her acquisitions. Some school aged kids are learning galactic geography now, but a textbook couldn't teach you which planets had the best economic conditions and on which ones the bribes were cheaper. No, that's what Wikipedia was for.
"It appears to be Gakrek," her secretary replied, "Gophor Spaceport."
Isabella frowned. That's where Rey's franchise was. She wasn't sure there were enough local customers there to support two franchises, and if it did, expanding the spaceport one would probably be the smarter move. She picked up the phone. "Hello, this is Isabella at Franchise Realty Corporation, how may I help you today?"
"Hello Isabella, my name is Grayin. I am from Gophor, on Gakrek. I am a friend of Rey, and I am trying to rent out my property. She said you might be able to recommend someone we could talk to," came her translated voice through the phone.
"Sure," Isabella said, looking up contacts on her tablet. It would be nice to do Rey a favor here. After all, Rey had kickstarted her own offworld real estate career. "What kind of business are you looking for?"
"Oh, it's very similar to Rey's building. We have an additional patio out front with space for outside seating, but other than that, it's pretty much the same. She even let us use her blueprints. We're hoping to find a fine dining business willing to take it on," Grayin replied, mirroring what the humans told her earlier.
"I see," Isabella replied, still searching but suddenly paying a lot more attention to this conversation. She could add two and two together. If this was a completed building just like their existing franchise and this was a friend of Rey's, the business opportunities here were… "Just out of curiosity, how much are you looking to charge for rent?"
Caught slightly off guard, Grayin answered honestly, "we thought we could charge 120,000 credits a month to a big chain, a little more than Rey's because we have more space."
Holy smokes, Isabella thought, another unbelievably great deal. Gophor was just the gift that kept on giving. Normally, her managers wouldn't approve a deal renting another piece of real estate right next to one of their franchises for fear of cannibalizing their own business, but commercial real estate was their bread-and-butter moneymaker. Who cares what fine dining restaurant the folks upstairs would eventually decide to sublet this out to? They wouldn't turn down a free win like this one.
"In that case, I think I might actually be interested in your space," Isabella said, putting down her tablet. "When are you free to do a walkthrough?"
Site 1, Gophor Spaceport
Grayin and N'har watched warily as the spaceport manager entered the front of their newly built construction. It was Garber. Grayin knew exactly what he was there for.
"Welcome to our new building, Garber," she greeted him at the door with a neutral tone, "how can we help you?"
"Ah, Grayin. It's nice to see you," Garber said in a grating snivel, "you look well. I was sad to see you leave our space traffic control tower."
You probably just missed skimming off my salary, Grayin fumed, but kept that part to herself.
He continued, "as you know very well, we have a tradition of maintaining our spaceport here on the donations of our merchants. I'm here to assess a suitable amount for your new store."
"How much do you have in mind?" N'har asked.
Garber looked over as if he'd just noticed N'har's presence, and stroked his snout thoughtfully. He knew he wildly undercharged the humans in the other store. He would not make the same mistake here.
Garber didn't know how much Rey's franchise was actually taking in income, but he thought a ten times increase would be a fairly safe bet. "I think we can start at five hundred fifty credits a month," he sniffed, "that seems reasonable to me."
Both Grayin and N'har managed to keep their composure at this incredibly low figure that represented less than 0.5% of the deal they were going to sign with Isabella later.
N'har glanced to his left, where he noticed Grayin was already taking out her wallet. He gave her a slight shake of his head and sent her a telepathic "no" with his eyes. He would rather Garber not come back with a higher "donation" request every time they built a new building here.
N'har pretended to haggle with Garber, "that seems like a lot of money, Garber. I hear Rey pays much less than that. And we're going to build several more buildings here in the future."
Garber chewed on that thought for a while. After all, he was a reasonable and logical Gak. If what they were saying is true, there will be plenty more credits to extract from them in the future.
"Hmm, in that case, I can give you a discount. Five hundred credits a month," Garber said generously, then added, "but you have to donate that same amount for every new building you put on my spaceport. That's my final offer. We all want your business to be successful."
N'har almost had to stop Grayin from throwing her GC card at Garber.
Constellar Contracting started as a mercenary company on Earth, increasingly taking over the combat roles in humanity's numerous small wars. Due to limited oversight on their operations, they were able to aggressively expand during the early 21st century.
Unfortunately for them, peace came to Earth. It wasn't full utopian world peace, but with economic booms happening on every corner of the globe and weather patterns stabilizing with humanity's fix for climate change, there was less motivation for planetary conflict.
So Constellar turned to the stars. Even in the great galactic Pax Hominum brought on by Earth's economic expansions, there were plenty of opportunities out there for a corporation offering premium security solutions.
After all, there were plenty of conflicts and business to go around in a galaxy of thousands of planets. Olgix was merely one of them.
Territorial Space, Zakabara Second
"Space Lord, we have an incoming communication for you!"
Canouah, the great Space Lord of Zakabara, looked at his subordinate with surprise. His underlings were getting very good at their tasks and normally did not need micromanaging to enforce this months-long blockade. Annoyed, he said, "very well, open it."
"This is Commandant Marie Laurent of the French Space Force, representing the Galactic Union Peacekeeping Force. We are here to enforce our mandate under explicit invitation from the government of Zakabara Second, to ensure that their legal territorial space remains clear of hostile ships. And to facilitate the resumption of trade to the planet. Please stand down your ships and vacate this area within twenty four hours to ensure a peaceful transition of power. Thank you for your cooperation."
Then the human connection cut out without waiting for a reply.
"Someone get me planetary command!"
"How many ships do they have?" Popptaw asked from the viewscreen. Clearly, fighting her way out of this situation was in her instinct.
"Unknown. We could only find the source of the one ship that brought the message, but once they ended their transmission, they sped into a debris field and vanished among the trash," cursed Canouah. He had heard about how Earth ships could disappear like a worm in the mud, but hadn't truly believed it until he saw with his own two eyes. "We can't fight an enemy we do not see, with weapons we can't match, and numbers we don't know."
"So we just give up? We spend all that time and resources building a space fleet for you, and they mean absolutely nothing just because Earth sends maybe one ship?!" Popptaw asked furiously.
"No, we can move back to Prime and protect our home from the humans for when they invade us," Canouah said sadly, "but we can't engage them offensively in deep space around Second. It will just be a waste of ships, and as far as we know, they can build many more of them than we can. We should pull our ships back to defend home."
"No!" Popptaw screeched. "You won't take one step backwards from our defense of OUR system! That's an order!"
"What do you want me to do? Just shoot randomly at empty space until we hit something?" the exasperated space Lord asked. Then, looking at the phone, he realized she'd already hung up.
"What do we do, space Lord?" one of his loyal lieutenants asked, looking at him for guidance on the ambiguous and clearly stupid order.
Canouah thought for a while. Then he had an idea, "we'll wait out the twenty-four hour time limit. If we see any of them, we'll shoot at a couple of them and tell Popptaw we tried. Then we pull back. I'm not going to let thousands of my birds die just because she forgot to take her pills this morning."
Gophor Spaceport, Gakrek
"Do you think we should tell them they're pretty much getting fleeced by Izzy?" Enrico asked, looking out their second story window at their neighbors celebrating the deal signing.
"Nah, it's not that bad for them. One hundred twenty is below market value, but they'll still make their startup costs back in less than half a year," his girlfriend replied. "Besides, no need to go over and ruin their party. They'll learn to charge a higher price next time. Just like how Izzy learned to put that new utility clause in offworld deals."
Most of Grayin's family and friends were here to join in on the celebration. N'har's clan was back on Yis'Meh, but they would be sure to celebrate with them later as well.
"Chug! Chug! Chug!" the crowd yelled at N'har as he guzzled down his mug of Earth imported beer. They didn't live on a wealthy planet, but nobody ever accused the Gaks of not knowing how to have fun.
In one quick motion, he quickly drained his cup, and then turned around to plant a big sloppy kiss on the sensitive snout of a surprised Grayin.
The crowd went silent for a second.
Then, unanimously, they roared their approval in a loud cheer.
A beet-red Grayin returned the favor.
Territorial Space, Zakabara Second
"We see a ping again, commander!" Rekala reported. The humans had some strange technology that allowed them to disappear into the background of orbital debris around Second, but from time to time, they would show up on the radar as they maneuvered.
His commander mulled over this latest development and her orders.
"How far are they from us?" she asked.
Frowning at the radar, Rekala replied, "The ship radar thinks it might be about 320 kilometers away, but its signature is weak and that's at the very edge of our detection range."
"Are they within the MAR?" she asked. This was a loan word borrowed from humans. Many of their technology had been public knowledge, and the nerd birds who scoured the Internet for valuable information had found an air-to-air combat tactical guide.
It became standard training material for Zakabaran spacecraft crews. In this case, MAR stood for Minimum Abort Range. It's the range at which the target would no longer be able to avoid missiles fired from the spacecraft by firing their thrusters.
"No, commander, way out. They'll have over half a minute to respond if we fire now," Rekala replied.
His commander contemplated the information. Their standing orders were to fire warning shots at the humans, but not to destroy them. She doubted that was even possible in the first place.
"Alright, let's load up our missile and fire it at the signature. Let's see what they do."
At the very least, this should be a training experience for the crew. Like most of the Zakabaran fleet, they'd only fired a missile once before, and they had to retrieve and top up the fuel in it after the exercise. Some crews had not even been allowed to train with the system at all.
"I have a lock, commander," Rekala said. He didn't want to start an interplanetary war today. But he wasn't going to disobey orders.
"Fire," she said with more certainty. He depressed the trigger.
An indigenous copy of an old human missile slid out of the cargo bay.
And then, nothing happened. It just sat there.
"What the hell?" Rekala exclaimed, "it worked last time!"
When air-to-air missiles were invented on Earth, they encountered many issues. Early missiles were generally unreliable.
One of those problem missiles was the American-made AIM-4 Falcon. The Falcon had bad combat performance. It was designed to shoot down enemy bombers rather than fighters. It ended up doing neither. The American planes that could only carry missiles, specifically the Falcon, were often outclassed in dogfights by Soviet made planes over Vietnam. It achieved few combat kills.
The biggest problem with early experimental Falcons was that it was completely enclosed in a tube before deployment, so it could only lock-on after launch. This meant that early tests of the Falcon involved firing the missile at where you see the enemy planes, and then hoping that the seeker on the Falcon would also see and track the target on the way.
This was the model that the Zakabarans copied. However, the engineers on Prime were not stupid. They knew this was an issue from the start. They solved this problem on their copied missile; it had a radio that allowed it to communicate targets with the ship's radar before it fired. The lock-on could be done before firing.
The second biggest problem with Falcon was that the seeker was slow because its coolant took a long time to cool. It would take many precious seconds to lock onto enemy planes. The engineers on Prime disregarded this problem. This made sense because ships would have plenty of time to see the enemy in space before they were in range. Combat in space happened much more slowly than in an atmosphere.
Unfortunately for Rekala and his crew, the coolant in the radar seeker was consumed as it tracked a target. After they fired their missile in the training exercise, they retrieved it and topped off the fuel. They did not refill the liquid nitrogen for the seeker.
When the missile deployed, its radar turned towards what the ship told it was an ugly human target… and saw absolutely nothing.
"Alright, let's get out of here before the humans see us!"
"They're moving away from us now," the sensor operator reported to Lt Col Riku.
"Hmm… I wonder if they even saw us."
University of Zakabara Prime
"So they can only be fired once?!" Canouah shouted at the lead engineer angrily.
"Well… if you want to use it again, you need to refill the coolant as well," she told him.
"Why weren't we made aware of this?!"
"You never asked! We didn't realize that you were going to fire them multiple times! And oh yeah, you may need to manually reset the onboard computer."
"What?!" Canouah asked, confused. "Why the computer?"
The engineer fidgeted uncomfortably and explained, "there were some bad memory leaks in the guidance program, so we just doubled the onboard memory and figured that it was a problem that would solve itself when they hit their targets and exploded."
That… was simultaneously the most brilliant and idiotic thing he'd ever heard.
Canouah shot her a withering glare, and then he picked up his radio to his lieutenant. "Yeah, pull back our ships to the line the humans drew. All our ships. We need time to refit and rearm them."
"If we start a fight out there now, we'll do no better than the frogheads."
This marks the end of the Gakrek arc, but their impact will still be seen in subsequent chapters.
The missile memory leak is a reference to a commonly known engineer meme/story. Here it is in its entirety:
I was once working with a customer who was producing on-board software for a missile. In my analysis of the code, I pointed out that they had a number of problems with storage leaks. Imagine my surprise when the customers chief software engineer said "Of course it leaks". He went on to point out that they had calculated the amount of memory the application would leak in the total possible flight time for the missile and then doubled that number. They added this much additional memory to the hardware to "support" the leaks. Since the missile will explode when it hits it's target or at the end of it's flight, the ultimate in garbage collection is performed without programmer intervention.
RoyalRoad
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War of the Medium/Heavy duty EV SPACs – the Good, the Bad and the Shady

I have finally taken some time to analyze several hot EV SPACs, I wanted to focus on FIII, GIK, NGA, ACTC and XL Fleet this time since those 5 are kind of similar. That’s why I left out Canoo, Arrival and Lucid. I am not a financial advisor and do your own research before investing. I have read many reports which have brought me money and I just wanted to return something to the community. Feel free to disagree and share your thoughts. Big wall of text ahead, you have been warned!
So let’s begin:
FIII/ Electric last mile
First one on the menu is FIII, merging with Electric Last which is basically a new US entity formed by a Chinese company called Sokon founded in 2020. Sokon is apparently big in China where they have sold 30k electric vans on Asian market so they just want to do a copy paste and do the same in US. Sokon is in the US market since 2016. through owning a EV company called Seres.
The good
- They have 100k capacity Indiana powerplant (kept 430 employees) which was acquired by Seres previously, IMO this is big and provides a great platform to deliver good numbers
- Previous experience in building vans in China, all they have to do is copy paste
- They claim to have 30k signed preorders
The bad
- No product has been delivered yet, 0 revenue so far, US entity founded just prior the deal, final purchase of the preorders are contingent upon satisfaction of customer requirement
- Only one Minivan offering planned in near future
The shady
- Sokon is not new to the US markets and their older company Seres (since 2016) has absolutely awful reviews on Glassdoor, only 16% of employees approve of the CEO, Seres had big plans to deliver SUVs to the market but those plans have been unsuccessful so far, I know Seres is not ELS but it tells about their company culture
Conclusion: If they make it happen they could be big, my biggest concern is that they have been very unsuccessful with their previous venture, IMO the reason they decided to form a new entity and not to merge through already existing Seres company is because they knew people would find bad reviews and they wanted to rebrand themselves. However, if their company culture in the USA had big problems and employees who are in general extremely unhappy with management, what would make it different this time? What I have to add is that their CEO will be a previous Workhorse CEO and he might create a different working environment.
Short term swing: yes, I can see it getting to 17/18 mostly because nobody is going to dig deep enough to see their previous failures. However, I prefer to pass it and to invest my money in others.
Long term hold: definitely sell before merger if you are in, buy again if their plant starts actually delivering good vans, I am very skeptical of their business. I would bet against their projections considering everything I found out from their Seres employees.
GIK/Lightning eMotors
Here we have a market leader in Class 3-7 vehicles electrification, they are already having 120 vehicles on the road. They are offering commercial ZEVs (both battery and fuel cells) and Charging solutions.
The Good
- 1500 already ordered vehicles from key customers, 20 new customers and 10 repeat orders which means they are doing quality work
- Tons of strategic partnerships in place, Already received purchase orders to fulfill 100% of 2020E and 2021E revenue
- Electric repower will be the way to go for a lot of businesses, eg. If you already have a Bus fleet, would you go to Proterra, order one and wait for two years or would you pay 50% less to GIK and electrify your bus in 6 months?
- Insanely low starting valuation at 0.6b
The Bad
- Out of all EV spacs they got only 225 mil from GIK and PIPE which isn’t much and might influence their expansion potential
Conclusion: I love GIK, they are legit, they have vehicles on the road, customers are happy, they have scheduled orders until the end of the year. Big question is how they are going to be successful in scaling the business. Current share price of 14.3$ gives the company valuation of 1.1b which is a steal. I am in it, I expect it to run up to 20$, depending on the run I will decide how much I will sell, might hold some after merger.
ACTC/Proterra
We waited and waited and this was one of the craziest market reactions, I believe the price went to 18 in 30 minutes, however is it worth the hype?
Proterra claims to have 50%+ electric bus market share and has already delivered 1000+ vehicles which makes it very legit. They serve powertrains, buses and charging solutions. Also, in comparison to FIII deal here 86% of employees approve of the CEO
The good
- Already delivered 1k vehicles with the biggest revenue of all EV Spacs sitting at 193mm in 2020. (FIII has 0, GIK 9, XL 21, NGA 29)
- $750MM+ of Orders and Backlog
- Close ties to Biden, might make big government deals easy
- 278mm from ACTC + 415mm from PIPE (be aware of the post merger dump) gives them the most funds to make it happen
The Bad
- IMO them being only focused on Buses slows growth potential, they aren’t active in any other EV category and do not plan to be, this can also be good in a way they will not try to do to many things at once which is a risk for some other companies
- Their competition is actually quite big, several employees have pointed out in their reviews that it will not be an easy market in future at all
The Shady
- Their Investor presentation (while being the most beautiful one) screams insecurity when they talk about competition which is a big red flag for me. They compared themselves with Arrival, Nikola, Romeo and even Canoo?! Its like comparing apples to oranges. Why haven’t they mentioned Lion Electric which also has proven products on the road? No mention of BYD or NFI-New Flyer Industries comparisons which also has EV buses. EG. NYC bought both Proterra and NFI buses but decided to buy again only from NFI. I am no expert but if they are claiming to have the best buses they shouldn’t be afraid to mention competition and how they are better. I have found their buses are supposed to have better specs than BYD but no data on NFI.
EDIT: Few thought from u/kvncls who thinks I had a too negative outlook and didnt agree with some of my points, I find his insight valuable:

Most of their profits in the next 5 years are NOT coming from selling buses. Their main thing is providing EV powertrains and batteries to other commercial OEMs, primarily Daimler. Plus, they’re not only building buses. They’re building trucks. They’re building batteries. They’re building fully-realized powertrains. They’re building EV charging stations for fleets of buses/trucks.
They also have a major investor in Daimler, who also happens to be their biggest customer. Daimler’s got $50B in revenue in 2020 and ~520k vehicles sold. How is this not mentioned at all? Proterra is building out batteries and EV powertrains for them at a scale HYLN could only dream of. -Arrival, Nikola, Romeo, and Canoo are ALL competitors. Why? Because they all have products related to Proterra. • Arrival builds transit buses/trucks. 0 revenue. All promises. • Nikola builds Class-8 trucks. 0 revenue. All promises • Romeo builds batteries. 11M revenue. They have product. • Canoo builds buses/vans/trucks. 0 revenue. All promises. • You missed this, but they also compared their selves to Hyliion which has 0 revenue, all promises. • You missed this, but they also compared their selves to Chargepoint. Why? Because Proterra builds EV charging stations for fleets of buses/trucks. Proterra literally does all of those things and has bigger revenues than all of them combined.

My response: What I mean when I said they are only focused on Buses (I agree i should have explained it better, English is not my native language) is that they are only building buses (while others are involved in building their own trucks/vans, Proterra is providing powertrains to OEMs), I meant that if they had their own van/truck their growth potential would be bigger. Regarding their competitors: they literally put a slide saying “Other mobility Technology Players: PowerPoint and Prototypes” - this is not true, they have competitors thar have real products and revenue but they decided to put the companies they can easily bash. Why arent Lion, BYD or NFI group there? Those are real companies with real products and revenue. Those companise should be listed on page 13 and 14 and not Canoo. You list Cannoo, Nikola and Arrival if you want to look better and hide your real competitors. Thats what I meant when I said they didn't mention their true competitors (only Lion a bit later). I do agree that Daimler partnership is a big one, someone also mentioned it here. I will edit my post to add your thoughts, thanks for participating. End of EDIT.
Conclusion: At current share price of 23$ the company is valued at 5.5 billion. NFI Group is the largest bus manufacturer in USA with annual revenue of 2.9 billion; they have currently around 300 EV buses on the road but plan to have way more. NFI group is being valued at 1.9 billion. Make of that what you want. I am no EV bus expert to make good conclusions who has the best ones. Am I in Prottera? Oh yes I am and I will buy more warrants, market loves Proterra, nobody is going to think about their competition and challenges short term; once Biden says EV Buses on inauguration it will shoot up. Will I hold through merger? No.
XL FLeet
XL Fleet the market leader in fleet electrification solutions, with proven, proprietary technology and electrification systems and solutions that work across a wide range of vehicle classes and types, they have already 3000 vehicles on the road.
The good
- Over 200 fleet customers with 3,000+ systems deployed, 130+ million customer driven miles
- Already having established production (6k per year capacity) they can scale to 100,000+ units annually
- Big demand from business who have good fleets where is makes no financial sense to buy new EV vehicles
The Bad
- No EV solution yet only hybrid, expected in to have one in 2023, being two years behind their competition if a big minus
In general, XL Fleet is sitting at 2.8b valuation which I do consider a buy at 22$. We have also that Citron report with the PT of 60$ which is a bit too much IMO but I can see them growing their business with their hybrid offer and after that who knows, it all depends on their EV solution. I am not in it just because I believe there are better plays currently.
NGA/Lion Electric
I left this one for the end and IMO this is the best company to invest in. They are focused on medium and heavy duty EVs, they have 300 vehicles on the road and their Quebec facility can produce 2500 vehicles per year. On the wings of Amazon I believe they will be big.
The Good
- 100% built in the house vehicles, 7 vehicles already available today, 4 trucks, 3 buses
- Amazon partnership – 2500 vehicles on schedule + option to buy 20% of the company
- Opening high volume production facility in the USA, CEO said it will be producing 20k vehicles per year, announcement could be any day soon
The Bad
- Only negative I can see that it has already gone up a lot, also 300 vehicles on the road after 12 years aren’t that much, having in mind their production facility with 2.5k vehicles potential
Conclusion: So many great things here, proven products, partnership with the best company to have as a partner – Amazon, new factory and a legit CEO to lead this. Think about Nikola – no product, just a truck prototype - its trading at 7.7 billlion. Lion Electric - even at the price of 31$ is valued at 4.9 billion. I can see it doubling until the end of the year. Even though we had the Amazon and Cramer pump there is still the new factory announcement and probably Biden talk which will be a big push for all EV.
///
My personal strategy: I am already in GIK, ACTC and NGA, I will skip FIII and XL Fleet for now. I am buying more GIK warrants today, I believe that play has the best value right now short term. I will buy more ACTC warrants hoping for a pullback. Merger date might be far away which might cause the stock to bleed but I do want to have a stronger position before the Biden speech. NGA has run up a lot and we will probably have profit taking soon, might be smart to wait a bit. If you are thinking long term then get NGA warrants even with today’s prices. Warrants are 12.5$ which means you value the company at just 3.2b. IMO warrants in all three SPACs are a better buy than commons.
I believe we will have a big EV boost post Biden inauguration. He wants to go EV with all the buses, first ones will be School Buses which will be great for Proterra and Lion, the demand is so big there is enough for everyone.

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