Repost (Not my post) Hi Again - I had another conversation today with Todd (ID's fearless leader) and these are the notes...
"So again the call I had with Todd was very enlightening and again He was very prompt...he even called me early and asked if it was ok to chat early. Unfortunately I was driving my kids to school and asked him to phone me at the scheduled time. He politely obliged and apologized for the inconvenience.
This may seem irrelevant to some but his demeanour is very professional and respectful. Both excellent traits in a leader.
The points I wanted to discuss were:
1. Competition - How ID stacks up vs the competition on a value for dollar basis.
ID's main competitors are Proofpoint, Zix. MS 365 and Sharefile.
ID's Delivery Trust product is more expensive per user monthly but the cost to set up and maintain Delivery Trust vs Proofpoint's and Zix is significantly lower therefore making the total cost substantially cheaper and more efficient (easier for the customer) than both Proofpoint and Zix. Sharefile is a completely different tech and isn't HIIPA compliant which is becoming increasingly more important. Also Sharefile had a very large breach recently due to the nature of their tech. MS 365 is similar to Proofpoint and Zix...a little cheaper per user per month but 10X the cost to administer and maintain.
2. What is HIPAA is and how important being verified by them is?
It's an acronym for The Health Insurance Portability and Accountability Act. For an email system to be HIPAA compliant it must be encrypted. HIPAA has basically set the standard for privacy and the rest of the world is following. And HIPAA AUDITS!!
They have 4 levels of fines depending on the degree of malpractice or non-compliance.
1. $1000/record
2. $5000/record
3. $10,000/record
4. $50,000/record
Keep in mind that's PER RECORD!! A major HIPAA ruling can destroy an association or company.
ID has a very reputable reputation within HIPAA which helps them immensely in sales meetings.
3. Qubechain - How is the relationship structured from a business perspective?
Qubechain changed their business. They are essentially a reseller of ID's product. They are paid in 2 ways...it's either a 1 time finders fee of up to 10% or if it's a Qubechain client, it can be up to 20% of the residual. The most Qubechain has effected the profitability of a contract is 10% bringing the net profit margin to 60% lol. Still pretty good imo. They have some other massive relationships similar to Qubechain in the works.
Qubechain has become more of a partner to them and they have a very synergistic relationship. They are very connected within the medical community and they have a large staff working diligently reselling Delivery Trust.
4. How many users do they have? Just over 25,000 users to date with users being added daily.
5. Are they maintaining their 70% profit margins? Yes except when the product is resold. Which as mentioned , diminishes the margin by about 10%.
6. What is average monthly cost for the user? $6-9/month. The larger contracts usually sell for less per user but he mentioned he tries to close EVERY sales meeting.
7. Are they having any problems scaling with all the new contracts? No not yet. Obviously more capital would allow them to scale faster but he pleased with their growth rate and he feels investors will be as well.
8. How is their blockchain progressing? They will be announcing something possibly his month...
9. Do they have any crypto involvement? No. Todd feels a day of reckoning could come in the crypto world although he's not discounting the tech. They have no plans to do a ICO.
General thoughts/comments...
- There are only 250 PHD Cryptographers in the US and Canada and ID has 2 of them employed. Lol.
- ID's core company competency is making security simple.
- Todd regularly lectures and keynotes on tech security at university's and conferences.
- He's very pleased with how 2018 is looking and expects a big year.
- Will be profitable by mid 2018 and from there all new users are "gravy".
In closing...
More or less what I have said...they will be an absolute beast end of 2018-mid 2019. Now is the time I plan to accumulate. But it's not a stock that will explode anytime soon.
Personally, I believe there may be a spike this next month when they update their developments on their blockchain.
I'm more confident than ever on the direction of this company based on this dd. They have a very effective, patented product and they deliver it for less cost and hassle to a market where the demand is increasing exponentially. Bodes well imo."