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Replies to post #6226 on Sphere 3D Corp. (ANY)
05/29/14 12:00 AM
05/29/14 8:16 AM
Was an excellent meeting. Was great to have such a large iHub contingent present and meet many face to face - took a while to figure out who everyone was from their avatars. Had some beers and lunch with the "Eagle contingent" and JB - thanks guys! Also present were Justfacts and The Progressive. Possibly some others I didn't get a chance to meet. I think I might have seen M+ there at the start (had a "the glass is always half empty" T-shirt on and a tin foil hat), but I think he left when they ran out of donuts just as the meeting got started.
(JD: Yes, it was a great meeting and a pleasure to meet so many iHub Sphere 3D posters!) Yes, it was great seeing the avatars...live and kicking...a very nice bunch of gentlemen...(missed the beers afterwards to attend to girlfriend patiently waiting)
We all had access to ALL the management (Overland, V3, Sphere - all very well represented) and then some. So much to report that I don't know where to start. We all were kind of flitting about from person to person after the meeting trying to get as much detail as we could, and most of our questions addressed. So...here are my notes in no specific order and everyone else can jump in and fill in their comments when they get back home;
Celio: This is on, but so many other priorities at the moment that this can wait for now. They have the rights to acquire them and their patents, and there is time.
(juggling priorities was a constant theme throughout the meeting - in other words, so many opportunities, and the phone is ringing off the hook. When the "big boys" call, you have to shuffle your priorities!
Nasdaq: Soon...very soon. Scott Worthington (CFO) was most knowledgeable on this process, and we got the impression from him it would be in the next couple of weeks.
OVRL Merger: No worries whatsoever of this happening as announced. The ambulance chasers? They are down to just 2 firms, and many of the litigants have the same last name as the lawyers. Consider this to be an "acquisition tax". (Also ...important to know EK: OVRL's folding of Tandberg into Overland is complete...not a distraction for OVRL anymore)
(JB: I asked Peter T. if he was open to Sphere 3D being acquired in the near future. Peter said that he would not be in favor of it and went on to say that he wants to be a part of something that changes peoples lives for the better (aka Glassware)!)
One on one with PB: (other geek guru's congratulated him on 3V hook-up with SPIHF...and suggested 18mo. he would have huge windfall via buyout of SPIHF/3V...PB...commented...no much to big to give it away in 18mo. much too much opportunity to develop for TRUE value)
Corel: Same as Celio, except they can leave this in Corel's hands for now. The enterprise side is too big and too lucrative. Why worry about all the little retail adopters of this at $2/mo when one deal with enterprise B2B is worth $200K.
(JB: Peter T. said Corel plans to rollout Glassware enabled software in the 3rd quarter!)
JB can fill you in on his conversation with Kelly re: VAR's and distributors, but it goes something like "we only need 10% of the 16,000 to sell one deal each with services...."
(JB: I asked Peter T for a rough revenue estimate if each of the 20,000 OVRL resellers sold one Glassware enabled box. As we both heard, Peter T felt that if 10% of the current OVRL resellers each sold only one Glassware enabled solution, and the services that go with it, Sphere would receive $100,000,000 in revenue!)
The simplest and most significant comments from PT's presentation were:
1. The first line of power point: (Paraphrase)... "Glassware prevents any software from becoming obsolete"...
2. The next was "MSFT...dropped support of Windows XP"...you can buy outside support for next 18mo at the cost of what you originally paid for MSFT WindowsXP"
3. We have demonstrated that we can turn a major opportunity (prospective customer) from demo to paying customer in 60 days
Now extrapolate that out to what EK later told me: "Almost every ATM in the country runs on Windows XP!"...and yes they have a financial vertical. "And what about major educational institutions with their student dining cards running on XP?"
Kelly said that the resellers have to be trained and he thought that 1-2 thousand would be enough to cover the globe.
PB's take on roll-out and training: "Big Opportunities galore...I went to London to demo...but could not help tripping over (my words)... a "big fish"...who wanted it...it is happening everywhere. We have huge opportunity via Overland marketers in France...but have to ship the hardware for demo and train them first...it takes time...but we are all over the place...when I occasionally get back to Utah...my kids ask me "who are you"...lol"
PB: "Stoney Hall joining SPIHF from Dell...a significant statement"...
They currently can virtualize/emulate with a laptop, what used to take rooms full of mainframes. They showed us a new device they have developed that is about 1/2" thick and the size of a large credit card that they have just applied for a patent on, that does the SAME thing. Better yet, they are now working on a single chip that will do it all. This chip could then be installed in any device, so that device can become whatever you want it to be. Working on an Apple and want it to become a PC? No problem. Working on a Blackberry and want it to become an iPad? No problem. As Peter Bookman mentioned to me - the future is software, not hardware (and I'm paraphrasing).
(JB: The Sphere Team was very excited about this!)
Revenue is coming in NOW, and will continue to increase. Peter will put out Q1 numbers possibly next week, but not much to really get excited about. Expect LOTS of excitement when they get to Q3 & Q4 numbers. The only issue is that this early in the game, it can be a timing thing. The deals come in so fast and furious, that from one Q to the next there could be big spreads based on the deal timing - "lumpy" in other words for the first few quarters.
(JB: Peter T said he may start giving revenue projections starting in the 3rd quarter for the 4th quarter!)
Peter also played up the fact that most of the engineers at OVRL are highly valued software engineers. They are building a Super Bowl Tech team together with this merger, and culturally they are already very similar.
Novarad from 1st demo at HIIMS, to NovaGlass and becoming a paying customer - 60 days. Unreal.
They demonstrated virtualizing a program (Thunderbird) on the screen for us. I'm no techie, but it took just a moment and there it was. I think we were all looking for something more interesting or explosive or something, but that is the beauty of this - it is so simple and quick to do. Doesn't matter what it is, legacy software, off the web software, really complex autocad type software...whatever. It just takes a moment. That's what got the Novarad guys hooked. Rik Lidstrom was telling me it was amazing watching their faces as they virtualized their stuff from a USB drive right in front of them at the booth. Started with 2 guys, they then brought 2 more guys, etc etc...pretty soon they had 15 people in the booth while all the other vendors were empty.
I asked Peter T at what point will they start to piss off Citrix. He said "I think we just did this morning with the Ericsson announcement".
PB's comments on Citrix:...SPIHF offers the complete robust solution...more to come on that...
PS. Barrons this past weekend...identified several tech companies what would make sense to be take-over targets for Google...CITRIX was one...but Barron's doesnt know about SPIHF...but I am sure Google does...by now)
As Eagle mentioned, the excitement from the expanded Sphere team was very evident - I'm not exaggerating when I say all in attendance could feel it. The phones are ringing, and they are having to re-evaluate their priorities daily. Peter T felt horrible last week when he had to say "No" to a potential customer for the first time. From this meeting they were catching a plane to Texas - big customer, big meeting, no hints given. How many times did we ask about who they were hearing from and they smiled, looked skyward, and shook their heads - "can't say", but they're coming from everywhere.
(JB: From before the meeting, I got the impression that the Sphere Team was heading to Texas to see Dell. Then off to Europe (Hummm France?)next week!)...Hummm PB: Dell Advisory Board...Stoney Hall...Dell Sales...maybe they just know of a good ribs place in Texas?
How many tech guys were there talking to Morelli trying to get him to explain how it worked? He could take it just so far before having to politely say - "sorry, can't tell you any more than that, from this point on it is proprietary IP".
Marketing is all being done through the VAR/Distribution network (Overland still has exclusive commercial marketing of Glassware...well incentivized) with no disclosure as to its end) , social media, and the various events they exhibit at.
Someone asked about the perception in the industry that it is "too good to be true". They are having to deal with this daily, but all it takes is a demo and people are astounded.
(JB: Sphere had an employee at the meeting who has been dubbed "The Solution" by the Company. "The Solution" stated that there have been no complaints from the early adapters of Glassware!)
I can't think of anything else at this time of night. Bottom line, in 12-18 months, I don't think anyone really knows where this might be, but we can all certainly imagine it being multi billions eventually."
05/29/14 8:43 AM
05/30/14 2:01 PM
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