Replies to post #152889 on Wave Systems Corp. (fka WAVXQ)

[Robert I]

x-point - Great post and I totally agree that our primary focus should be on meaningful revenue growth, rather than breakeven, since breakeven will be a moving target if and when the market begins to engage.

[zen 88]

x-point: I think the desire to reach B/E

is fueled by no one wanting to see anymore dilution. Enough already. IF Wave needs more funds, which I fully expect, watch carefully the means of getting them. If the 4th Q reaches the level you predict, taking on debt should no longer be a concern. If they sell more stock, I would question their belief in the pace of the revenue model.

[AppalachianArchitect]

excellent post x-point

RobertI's response opened my eyes a bit when he described BE as a moving target.

Do we know that these are new job openings or replacements. Either way, are they enough for now? (I guess so.)

Leading to the real question,

Is Wave's management prepared for a MASSIVE growth period?
The number of job openings on the website don't even come close, IMO, to meet the needs of what's to come as we realize this major paradigm shift in security. Anyway, I don't believe that the new posting of 4 or 5 positions should be considered as much of an indicator of the big things coming.

And most of this is just my opinion as well.

[go-kitesurf]

xpoint, revenues vs burn:

I would not run the company this way. At this point, I would imagine the players entering the field to still be few and far between.

If Wave is ramping as you state, their product importance would warrant development costs for OEMs since they all want specifically developed solutions for their brands. Unlike McAfee or Symantec, which will develop a product that will work on any platform without any special development, Wave is specific to each platform.

In other words, Wave should be charging the OEM a development fee to get this done. Our company does this. We charge per month or per quarter depending on who we have to hire, or pull away from existing R&D projects to get certain things done.

There are BIOS, OEM logo and third-party conditions to be satisfied here, as well as individual hardware issues per OEM and OEM-product design. This benefits the OEM. Paying Wave to do this work for them will result in less $ than going elsewhere for free. Lost time to market, lost sales and poor product development will cost them more in the long run. Wave has a suite that works well, is well tested, and more robust than anyone else can develop in the near term. A professional sales team should be able to sell this to the majority of OEM-level management if security is, indeed, becoming more and more important going forward.

So the ramp up should reflect a correlation between BE and expenses keeping expenses at or slightly below BE going forward.

At some point in time SKS needs to start placing a value on working with Wave, instead of just "hey, we'll do it for you no problem." When will that be? When sales are ramping up and Wave can stand on their own two feet finally.