GP,
You are one of my top picks for someone I want to meet in person some day. You and I both have been following EO polymers for likely close to most of our lives. I’d peg you (giggity) at around 40-45 years old.
X’s post a bit ago on the history of EO polymers and Dalton is pretty much spot on. I own a book you can find on Amazon that documents the history of EO polymers from ~1980-1995. Fascinating read. X’s post basically summarizes the late 90’s into mid/late 2000’s.
Today, a technology like EO polymers is widely acknowledged as being required. It is finally time. With your supposed experience, you must know that. If you don’t, you are willfully ignorant. You actively trade this stock, so I think your motives lie there.
Scaling the technology is obviously the biggest question. Like any new kind of technology…can it scale? Your statements aren’t scary.
Other billion $ companies in this industry are in early stages. Some revenue, prototypes, but not yet at volume production. Lightmatter, Ayar Labs, and PsiQuantum are the top 3 that come to my mind. Lightmatter just raised money at a $1.2 billion valuation. They should be in production later this year or into next. PsiQuantum raised money a couple years ago at a $3.4 billion valuation. They have grant money and partnerships, but still 2 years away from selling their products according to a recent presentation. Ayar Labs…valuation unknown, but it’s multiple billions according to someone I talk to who would know. They of course have plenty of public partnerships/news and early revenue/grants…but I have non-public information about some technical hurdles they’ve recently experienced that is affecting their timeline to commercialization. No need for public disclosure as a private company.
These companies are developing larger systems for a dedicated use and not ‘just’ a component like modulators…that in a way narrows their market potential even though it is still extremely large. Components can be used anywhere and everywhere. LWLG’s technology will be cheaper comparatively but can spread wider.
These companies, many others, and LWLG all want to build a business based off a new technology platform…and ultimately make investors money. Buyouts are always an exit strategy and the investors expect that. And they’re still investing in 'breakthrough' technology companies at these valuations.
LWLG has spent more money in the last decade on maturing this technology than any single entity has spent in the history of EOP. Yes…cumulatively and collectively over the last 50 years I’d guess easily a billion has been spent on EOP…but LWLG’s R&D for material and device development is likely approaching $100 million at this point. Excluding management salaries…
Your statement…”Hoping third parties that the company has no control over can make it work is not a good business plan”…is just dumb. No companies have complete control over their customers.
Foundries very easily provide scalability, LWLG has material production locked down and is consistent, and they have spent the last 2 years perfecting the device design and material deposition/poling/packaging processes. They have ~24,000 square feet of space to do everything outside of manufacturing.
An 800G PIC will not just be a flash in the pan. Maybe you think so as a stock trader. Their first transceiver/OE partner is not some tiny company. The partnership is active. If LWLG’s tech was truly flawed as you say…this partnership would have died already. Work continues and the timing is still perfect to get this technology introduced to the market. Once available at foundries, why would any company choose TFLN or InP modulators over EOP? EOP will perform better and will be cheaper. Some will choose InP solely because the laser integration benefits. Fine…I’ll give you that.
If LWLG did not have the baggage of the history of EO polymers…the valuation today would be much higher IMO. The valuation went crazy when everyone thought mass commercialization was imminent. That potential is still there.
Risks absolutely remain. We need proof of scalability. We need to know the pricing.
Personally I have no doubts about the scalability and I do not believe Dr. Lebby is a liar.
I am intertwining myself in the photonics industry via new relationships and investments. Nothing I see right now concerns me about LWLG’s prospects. In fact, as an investor in another EO polymer company that is private…I can say that the future of EOP is extremely exciting with what I know.
