Spectra7 Microsystems Inc V.SEV

Share Structure and Key statistics of 2013

[SteveSchiets]

On this Chrismas day I have to work at the airport. Nothing wrong with that except all I can think of is Spectra7. And what happened to the shareprice. What are we seeing and what not.


I was listening to Warren Buffett and his comment on 'if you can't talk yourself out of an investment you are probably good'. Or something like that.

Spectra7 has big markets. check
Spectra7 has patents. check
Spectra7 has big customers. check
Spectra7 has increasing revenue. check
Spectra7 has moad. check
Spectra7 has great management. check (mindspeed exit validates that)
Spectra7 has financing. Not really
Spectra7 has a cheap shareprice. absolute check

The list is just a placeholder for my thoughts. And a good one because I compared the 5 year old video presentation of Tony Stelliga. He past away not long after that I believe.
https://www.youtube.com/watch?v=ta8BeqlCtYQ


I've picked up some big problems during that presentation. I did like the company back then and Tony does a great job of presenting multi billion dollar markets to be within reach. But nothing could be more from the truth.

Tony's flat panel display market is a niche and not high volume.
Tony's interconnect tablets markets is also a niche and not high volume.
Tony's VR/AR PC market is a bigger niche with some revenues.

He promised big numbers and nothing materialized. It's not my intention to bash his poor soul but I'm just tracking down what happened.

At the vey end of the presentation we see the share structure and key statistics.

(2013)
Common shares: 53M
VC investors lockup for 2 years 36M shares (2015)
Public float: 31%

So there you have it. The VC's sold their ton of shares in the public float and without those big revenues coming is (great technology, wrong markets, imo) Spectra7 got in trouble. That's why a thin traded stock crashes harder then anything else.

Now I know what happened I can focus again what Raouf did when he took over. More VC financing and public offerings. The stock crashes to were it is today. But the mean difference is the markets has changed.
The company has a future with the datacenters design in's. Forget about VR/AR PC and console markets. The Sony news is nice but that's not where the money is. And Raouf knows this. I hope he can pull this ABL financing off and/or with patents royalties on top.

I love this inflexion point where we are. It's do or die time except my 500K shares will be zero or 1M dollars in just 2 years from now.

Place your bets.

Enjoy the holidays,

Steve