Zevotek, Inc. (ZVTK)

[free_man_n_paris]

Many had a knee jerk reaction to the dilution in the Q. But what you have to remember is although this company has been around a few years, it should, for all practical purposes, be considered a start up company in many ways.

We got a new CEO only 3 months ago, who was on the job for only one month before end of previous quarter, which didn't enable him to have too much of an impact before the quarter ended. But even in that short time frame he accomplished way more than the previous CEO in his entire tenure.

The new CEO has a good business plan and is executing it. It will require capital to fund higher production to increase inventory in preparation to go retail. At this stage that funding will largely come from dilution as credit facilities are very tight in this economic environment. This has already been done to test market the bulb, such as funding the commercials as well as the other peripheral things that have to be set up in order to sell via infomercial, website, etc.

So we got basically the results from the previous quarter that included taking the financial hits from these necessary steps but didn't have alot to show for it in terms of sales-YET

What I don't think some really understand is the YET part. This is a normal part of starting any business that's trying to sell a product. Some do great, some barely survive, while many don't survive at all. To me, what separates these is having BOTH a good product AND a good management team to execute.
ZVTK has both and that is fairly rare.

And even though April wasn't included in the Q, and was not selling retail, I just can't help but believe the sales(from infomercial, phone orders, web orders, and other sites such as Amazon) were much much better than March. And so far this month as well. But that is not the long term focus of the company. It was to test market the bulb and to pave the way for retail sales, where the real money will be made.

So I expect some more dilution to have to occur to fund this up front and I have no problem with that. The reason I don't is because I believe the CEO is well aware of what has to be done to get this going and he is also well aware of what can be done down the road to address this once retail is achieved which would cause sales revenue to explode. THEN you can get your financial house in order.
But first things first.