Drmyke - I have been researching the theory of "growing revenue in an emerging market", as it is an imperative theory NEOM investors must accept in order to continue holding long in NeoMmedia Technologies.
As previously stated on this board, I am a conservative investor, with a keen eye on going improvement by a company in growing positive cash flow.
So how did I get from there to here - in a very volital market, with a reluctant, but knowledgeable mind set on the theory of "growing revenue"?
The following is my thinking on how I have amended my views with this "unique eneriging market opportunity" of growing revenue, as well as, positive cash flow.
NEOM, on it's own, before 2/06 and 3/06, was not in a position to substantially "grow revenue". NEOM now has companies to grow with.
The 13500 stockholders of NEOM, are probably the most knowledgeable stockholers of this "unique growing market", as we are "right in the middle" of this emerging market. We understand and can see the future of the market.
Prior to 2006, NEOM, had a cap on it's ability to finance daily operations. By "growing revenue", and a "greater opportunity for market share", with additional companies, NEOM's cap on limited financing has been elevated.
NEOM has "grown it's revenue base", and whether "positive cash flow can be generated from growning the revenue base, is a task NEOM management will ultimately have to reconcile it's self with.
NEOM could not build positive cash flow, without "growing revenue", thereby increasing it's ability to command a geater share of the market.
NEOM, could not "grow revenue", without lifting the cap on it's ability to finance the purchase of necessary "related market" additional companies.
Some posters have stated "why didn't NEOM continue with the same financing arrangements it had with Cornell, by just paying interest expense and fees for financing arrangements".
What some individuals are unable to understand, is the fact that there was a cap on how much money NEOM could raise through it's prior arrangements with Cornell Capital.
Look at MOBL. Here we are comparing a growing and expanding company, (1) which is investing in inventory, IRC Section 1245 depreciable assets, as well as all other operating expenses (salaries, supplies, state and county fees, pension plans and other operating expenses, etc), (2) to NEOM, who is purchasing companies, who hold patents (like NEOM), who are out there struggling to command a market share, just like NEOM was on it's own.
Ask yourself, which is a greater financing risk for Cornell Capital.
MOBL's cap (and many other companies) on financing would be different than NEOM's. The market, for MOBL to grow, exists and is thriving. The market for NEOM, is begining to show it's face, and the financing risk by Cornell, is much greater in financing NEOM, than the risk of financing MOBL.
To get back to "growing revenue" - NEOM's ability to grow revenue, has substantially increased, but not to the point that NEOM can generate and rely totally on sales revenue and the sale of stock, to generate enough operating cash to (as JP, Claw, YJ, Hangdog and others have stated), "totally sail this ship".
NEOM, must have security, right now "to sail this ship", to where ever this market is going. NEOM and it's stockholders had no choice in paying the price to get to where we are now.
All companies, in order to survive, must have an "insurance policy of guranteed operating capital", at "whatever the cost, the company and it's shareholders have to pay to get that insurance".
The opportunity to command the greatest share of the market possible, for NEOM, has, or soon will be, paid for. The high cost of our insurance policy, with Cornell will soon be "paid up".
What NEOM needs is education of the public (and it's growing), to increase it's shareholder base. Individuals who are willing to conservatively, take a chance on a growing market, who are willing to conservatively invest, as many investors do, funds for a growing market.
Additional investors, plus "growing revenue", will carry NEOM.
Growing revenue and investors will increase positive cash flow.
Increasing shares will also increase dilution, although increasing shares will also increase NEOM's ability to grow in purchasing other companies. Purchasing other companies, necessary in the "one stop theory", will also grow revenue. "Growing Revenue will also increase "positive cash flow".
This is a "unique market" we are in, otherwise, I would not be here.
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