26 May State of the CHRON Union – Part 3 of 3
Posted at 15:55h in Chron, Main by Alex Rodriguez Share
This is not an offer to sell or a solicitation of any offer to buy any securities. Offers are made only by prospectus or other offering materials. To obtain further information, you must complete our investor questionnaire and meet the suitability standards required by law.
Dearest CHRON Friends & Family:
This is the third installment in my three-part series of blog postings, which were designed to answer questions we received from our last shareholder meeting. One recurring question we’ve been getting for the past 3 or 4 months now is regarding the topic of our share price and overall share activity.
Needless to say, this is a complicated topic and, because of the regulatory nature of the question, it may be a bit difficult for me to answer head on… or at least in the transparent manner I would otherwise like to. Nevertheless, Byron and I promised we would always be transparent, so we will hold ourselves true to that promise.
Before I address share price… let’s take a closer look at what really has happened.
I would like to remind everyone about some of the strategic tenets we shared with you guys when we first embarked on this journey. These are as follows:
We stressed that we were long-term thinkers and that we had long-term plans for CHRO,
Any shareholders coming into CHRO should have a 3 to 5-year vision,
Our plan was to build a long-term business that would be around for decades, and
Our plan was to someday up-list CHRO to one of the major exchanges.
If you carefully examine our accomplishments and developments over the past 16 months, they are in direct alignment with these four tenets. The fact that we just filed our Form 10 with the Securities & Exchange Commission conveys that we are ready to be at the grown-up table. It’s not even official yet and won’t be until on or around June 20th, but I’ve got to tell you, the doors that this is already opening for us are unbelievable. Anyway, I think right now is a good time for me to remind everyone about these things. I have learned over the years that it’s a very rare breed of people who actually do what they say and say what they do… but look at what we’ve done. I am both humble and confident in pointing to the record book and at our team on the floor right now. A few months ago, I made the following statement on a conference call, “By the third quarter of this year, there will be absolutely no doubt as to what this company is about.” Should the Good Lord tarry, mark my words.
Question: “Why don’t you do something about the stock price not being higher?”
Well, the first thing you should know is that we (management) are never happy when the stock price is low; believe me, it bothers us just as much as (and probably more than) it bothers you. However, the second thing you should know is that we cannot effectively grow and manage our business if we are constantly obsessed with the stock price on a day-to-day or even week-to-week basis. This simply is not effective executive management modus operandi for a real company like ours. At this moment, there are only two (2) things I am obsessed: number one is getting off the Pink Sheets and number two is revenue, revenue, and more revenue. As you should already know, both of these are underway. Of course, strategy and making scalability that is built into our organizational and functional structure are also critical, but again, “revenue, revenue, and more revenue” sounds hotter.
Now let me address this topic of “shorts” and/or individuals that may be “dumping large shares.”
As a Pink Sheets company, it is plain difficult, if not impossible, to know these things with any degree of timeliness or certainty. Once we move to the QB, things will certainly be different, and by different, I mean better. Pink Sheets companies are going to do what they are going to do – and that is be volatile on a whim, sometimes for no reason at all. This is why from the very beginning I have said, “We need to get off the Pink Sheets,” and now we are doing that. To my knowledge, only a few groups (less than four) actually have large blocks of shares. Based upon what these groups have represented to me personally, these are all very friendly to us and are with us for the long-term. That’s all I can go by and candidly, I believe them.
I certainly cannot comment on any price or price range speculating where I believe the stock is going or where it should go; I had to get this blog posting cleared by legal. So please do not misinterpret this posting as a prognostication on our stock price. However, I can provide some general thoughts in broad strokes and express said thoughts about the market in general. The reality is that most companies on the Pink Sheets are simply going to be thinly traded; this means that any type of movement, up or down, good or bad, is typically going to cause a major swing in market prices. Most experienced investors, analysts, and investment professionals would agree that this is just the nature of the Pink Sheets marketplace. I know it’s easier said than done, but remember you came into this deal for the long road; not the short-term swings, but the long-term value we said we would create as a cutting-edge smart controls/energy company.
Secondly, most companies that are listed on the Pink Sheets do not get any type of analyst coverage, nor do they get any shareholder involvement from the bonafide professional investment community. It is for these various reasons that from the very beginning, our goal has been to get off the Pink Sheets and become a fully-reporting SEC company, which is now underway. The filing of our Form 10 back on April 21st 2017 was the first major step in that direction.
The Form 10 is set to go effective on or around June 20th, 2017 and this event is easily the most significant in our entire lifecycle thus far. The fact that we are trading at the levels where we are right now is completely beyond any explanation I can provide. To me, it makes no sense. Candidly, there were times in 2016 when I genuinely thought we were overvalued; we were experiencing historic highs in our stock price during a time when we were still cleaning up the company and dealing with risk. If you contrast that against where we are right now, it makes no sense. At the time of this blog posting, we are fulling our vision, moving off the Pink Sheets to the QB, starting to on-board highly regarded commercial customers, and we have a pipeline of commercial business that will keep us operationally busy for the next two years. Yet, we are trading at a historical low for us, so go figure. This just goes to show you that it’s impossible for us have any real impact on the stock price.
Furthermore, and while I don’t like being undervalued, my advice is to keep thinking long-term – our five-year goal is to become the nation’s first “virtual utility” and to have billions in revenue. Think about that day, not the current price while we are on the Pink Sheets. My belief is that if we stay focused, keep signing up customers, remain mindful of our revenue, the stock will catch up. That’s the normal trajectory.
Question: “Where do you think the stock price is going?”
This is the biggest question that legal and compliance told me not to answer at all. So instead, I will point you to our business plan, which is (a) to have 1 Million Smart Homes over Five Years as customers, (b) to have 100,000 Commercial Customers on our Energy Conservation & Procurement services and (c) to own as much or all of our intellectual property to provide these services.
These are certainly lofty goals, filled with all kinds of risk and obstacles, but if we land halfway there, I think we’ve got a good company. It’s hard to back into valuations; our business model touches on the repeat-order income potential from home utility services (alarm and energy), it encompasses the Internet of Things and Smart Controls for homes and businesses, and it even embarks on energy conservation in a major way. In any event, I trust that you all can do your own due diligence, find comparable case studies, and then draw your own conclusions.
Till then, keep your fingers and toes crossed, remember that we covet your prayers and good thoughts, and let’s keep blocking and tackling toward realizing our ultimate goal.
Yours truly,
Alex Rodriguez
Chief Evangelist for all things Zen
This is not an offer to sell or a solicitation of any offer to buy any securities. Offers are made only by prospectus or other offering materials. To obtain further information, you must complete our investor questionnaire and meet the suitability standards required by law.
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