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Happy to add a little signal to the noise level around here. Cheers.
RBIZ Competitive Due Diligence
Moderators: please make sticky.
This is not investment advice and I am not a registered investment advisor.
On a recent trip to the GCC region (1st week or July), I was curious to see if I could find some Verus Foods products already on the shelves, although it was a bit too early. I was very curious about this Shin C product and the RBIZ claims about the popularity of "vitamin drinks" in the region. I did not find any Shin C or other Verus products, but I did get some insights into this product category and the competition and I thought it might be helpful to some of you to share those learnings here.
The Competition
I stayed in the Dubai Marina District and I didn't venture out to markets in other areas, but in 3 for 3 convenience stores and markets I went into in the Marina area they sold what is clearly the vitamin drink for Shin C to beat: Vitaene and Vitaene Extra. I'm an American consumer and to me the Shin C packaging seemed a bit weird when Verus released pictures of it, but now I see what they are trying to do—It's what the market recognizes shape-wise in this product category. I have mixed feelings about identical bottle dress for our Shin C line of products, but this is done sometimes—tetra packs with simply different labeling, as an example. This packaging would also help communicate to a would-be purchaser what they should generally expect if they purchase it.
One thing that I thought about this product category from the Verus press releases was that it was meant to be a vitamin "health" category type of drink. On my trip I learned a bit more about this particular product. It's in the energy category with crossover to health and wellness, not just a "healthy" drink. Of course, I had to try the competition's drink... It tastes similar to Red Bull, but smoother, and with a great subtle fruitiness. I really was pleasantly surprised by this drink and I would prefer it far more than Red Bull, which I also buy occasionally.
I asked the store person if he sells many of these. He gave me a look like "oh yeah we do" and said especially on weekends at night. That's when I learned that it's also an energy drink—people sometimes drink these for long nights out.
Challenges
Fighting for shelf space is always a challenge, but this Vitaene brand is entrenched, at least on a hyper-local level in Dubai. I even saw this brand for sale in a small Dubai Airport kiosk, so it's really well-established locally. Perhaps familiarity will be an aid to increased channel product throughput—for merchants and buyers to at least give the product a chance—but if they can overcome the challenge of getting some shelf space, they could be on to a very interesting breakout category and ride a wave of category growth over the next couple of years. We shall see.
In short, for Shin C in particular, I think the biggest challenge for Verus is going to be elbowing its way into the market and fighting for shelf space alongside this ubiquitous competitor product.
However, if Shin C is as good or better than Vitaene, this could be very, very interesting and I'll tell you why I think so. I like it and I'm picky. I've spent time going out in clubs, et cetera, and I see a lot of those kind of sales driving adoption like Red Bull did in the early years—the clubs in Europe largely drove brand awareness and adoption as Red Bull sales skyrocketed. If they figure out what kind of spirit to get bartenders to start mixing with it, that can be a big driver of brand awareness. I'n not sure that they've considered this in their go-to-market, however.
On my next trip I expect to see Shin C and other items on shelves and I'll report back in a quarter or so whenever I've done more diligence in the region.
Below are a couple of links to photos I shot of this competitor product on shelves in Dubai. The green bottle is a sugar-free version.
https://ibb.co/gtyrTo
https://ibb.co/gkYQoo
I’m long on the RBIZ story, but to be honest I’m not convinced on this particular post. First, the 2nd of 3 days you highlight is the same spread as the previous day. Today was marginally wider, but it’s very hard to know what if anything is driving it. Lastly, people keep throwing around the word “whale” to the point it’s lost all meaning. Institutional traders move in and out of positions that literally are larger than today’s total market cap of $2.61mm. Today’s total activity probably totaled less than $600k.
I think keeping things in perspective is important because for RBIZ to do it’s thing will require patience.
Do you have any ability at all to short OTC stocks? If so where/how? And if not, these swings must be terrible for you - missing so much vol
There are multiple images that were taken from posts and are now drawn above the posts on the main page... one looks like a Titanium element reference from the periodic table, for example .Pin the posts or something, sure, but have to scroll past that each time you visit the main RBIZ landing page is pretty frustrating.
Moderators: Too many images above the posts.
Would someone clean some of those up? It's a bit of a pain to have to scroll down that far after any reply or each time you navigate to the page.
To be honest, I'm kind of counting on it, personally. I want a bigger position, so I've been accumulating and averaging down over the past 9 months or so. It takes some time to untangle all of the mess and get this thing going. And things invariably take longer than what people are hoping for. It's okay that it's volatile for now.
This company is a startup. It just happens to be publicly traded.
Once the spinout is complete and Verus is trading separately, it's important to be patient. Revenues will ramp steadily, but never as quickly as people hope and that's okay. Timelines for startups are longer than people on this board—for the most part—are talking about. Keep that in mind. My main reason for even reading it is the resources people share and that sort of thing. Assuming Verus scales its working capital over the next couple of quarters, I think we'll see a slow, steady growth for the next few years.
Startups—public or private—are long-term horizon investments. There is more risk right now, but if you believe in the opportunity, several years of time has the potential to pay off handsomely for that risk. Personally, I think they are positioned pretty well. It's all about working capital now.
Please cite your source for this info... IR?
You have an opinion and probably a position to back it up. Great.
Would you mind not posting 15 different posts in a short time period to the board so that other people get buried? Perhaps one longer, well-thought-out post would be more productive.
Well, I certainly would. Seeing how they’ve already carried considerable risk while he stock tanked they might feel motivated to write it down for a variety of reasons. They might not want to be in the food business. They might think the company won’t get favorable financing and it might no longer being a going concern. There might be a conflict with their relationship with NestBuilder. And probably 2 dozen other potential reasons.
What we DO know is that this stock - due to post dilutive selling - was below $.001 a month ago or so. So people have reasons.
There are 2 separate considerations here:
1) Has the debt been converted ?
2) Have the previous debt holders that have converted who want to sell already sold?
They can sit awaiting a more favorable price, of course.
It seems your reading is different from mine, here. I read April 25th was set as the date of record, which has not changed, but that June 21st (today) is to be the date of distribution (of the NestBuilder shares) - I can't see why they would use language to confuse a Date of Record with a date of Distribution.
I would question the validity of technicals in this scenario, as the "triple bottom" was being driven by unusual events, including likely dilution from debt conversion. It's not the same as a "triple bottom" for stock with a stable float not undergoing all kinds of changes, in my view. There was a structural driver that caused the drop from the April 25th high.
Minute price action data is not going to be any meaningful predictor of trend and honestly this only raises the noise level here.
“The Company is now current in terms of its financial filings”
This is what I mean — they announce they are current and lead the public to expect it to remain up to date and then immediately miss a normally scheduled filing at their next time at bat. Really makes it hard to believe any promises this company makes.
Anshu is consistent at one thing...
Missing dates.
Here's My Hypothesis + an Open Question
This pattern of sell pressure that started around May 9th could have been executive shares selling off that lasted right up until the moment that the NestBuilder spin-out was supposed to take place on May 18th. Maybe that's what it was. Maybe it was debt conversions. Maybe it was executive-owned forced debt conversions or something else. From May 16-18th or so we had a slight reprieve from the never-ending sell pressure and that looked great. Then it started again moving the stock price to new lows. Then another relented sell off allowing the price to rise (which it seems to want to apart from selling pressure). And now since the 7th another cycle of selling.
To me, that looks pretty obviously like converted shares trying to let the stock rise to get a slightly better price for their shares. In my view, this or something very like it is what has been happening.
My question is this: In the most recent 10Q it lists something like 167M convertible preferred shares—What amount of this selling volume comes from that? The cheaper the price is the larger amounts people are trading, of course, but of the very high volumes, how much of that is the conversion? I think it would be very, very helpful for people who see this as a potential mid- to long-term winner investment if Verus gets some critical things in place to know how much more blood letting remains. Of course the company can't make any statements to that regard, but I suspect there are analysts tracking this stock that have a pretty good idea of how much dilution remains. I haven't seen a post that gives much of an educated guess to this very obvious question.
Rip the Band-Aid off, Anshu, and let's build this company.
Are there some numbers behind this idea or just a "hunch?"
Retails Channels in Dubai?
Does anyone know specific stores that these 9 SKUs will be sold through and which ones will receive shipments first?
not sure about the original poster's, but I've accumulated shares since the fall and had a significant quantity before the April date of record and I still have not received anything, either.
Distribution Today? How is this supposed to work?
From the most recent press release:
"As previously reported, the SEC has approved the spin-off of the NestBuilder Real Estate Division and the distribution is set for May 18, 2018. Current RealBiz (RBIZ) shareholders will receive one (1) share of NestBuilder common stock for each three hundred (300) shares of RealBiz."
Based on this I, perhaps naively, thought that NestBuilder would arrive into my trading account where RBIZ lives. That did not happen. What was your perception of what was to occur? I honestly have no clue about the mechanics of something like this. I've never owned shares that had a spin-off of some kind.
Thanks for your input.
I'm not sure that I agree. I think whatever NestBuilder value is built into the price now, once that is detached it might take some time for Verus stock to sort itself off and could experience a dip for a period. I don't necessarily subscribe to the idea that there is a "NestBuilder" anchor around the neck of Verus because we've seen zero results as a result of execution so far. If they time so good financial news with the separation (and they certainly could) now we're talking about something else entirely.
Has anyone seen Citadel trading before today?
Today I feel like I noticed CDEL in the order book for the first time, trading around $.002 and $.0025. I'm curious if this is a signal that they think the price has reached something of a floor range. Without knowing the supply of convertibles to come and no real count of outstanding shares to be found online, I'm curious what they know that others might not. Thoughts?