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Suspend Our Disbelief

I was talking to my dad recently and the subject of MVIS came up. I mentioned that it seemed strange that the company would be much more highly valued several years ago when retinal scanning displays required racks of expensive lab equipment, versus today when the scanned beam display engine can fit into a small digital camera -- and the costs to create it are a small fraction of what they were then.

His response was interesting. He said, 'They bid up the concept. But now the concept has to prove itself in the marketplace.'

People seem to have an easy time buying shares of promising biotechs that are many years and many share issuances away from bringing any kind of product to market. People seem to feel OK about bidding up shares in anything related to nanotechnology despite an uncertain future and no idea about a timeline for profitability.

But when Microvision's opportunities become 'systematically more realizable' and imminent success is staring them in the face, investors seem to simply not believe it. They think about their prior expectations. They think about additional financing rounds. They think about siren songs. They resist the obvious. Their thought process stagnates. They make assumptions. They disregard palpable trends. They become overconcerned with minutia. They refuse to believe, no matter what.

There may be only one way to reverse this mass psychology. And that is to demonstrate that the scanned beam display can be commercialized, and there is a ready market. Demonstrate sales success for the Nomad. Demonstrate marketing skill with the Flic. Demonstrate execution of the company's strategy of attracting large partners to fund development contracts, then converting those contracts into design wins for production of high-volume commercial products.

I believe scanned beam displays will be adopted by mainstream society. And that most people in the US and beyond will own several products that incorporate Microvision's intellectual property: their cars, their cell phones, their TVs, their video game systems, and so on.

I believe that the way to make the most money possible between now and the end of this decade is to own as much of the future cash flow from the sales of scanned beam display and image capture devices as I can. Because I believe that the evidence is irrefutable: man and machine are becoming ever more intimate and intertwined; wireless bandwidth availability is spreading rapidly; mobile LCD displays are a bottleneck that is limiting profit potential for the communications and software industries; and Microvision's technology is literally the only solution for see-through, day/night readable heads-up displays.

It's not like there are lots of options out there for these large consumer electronics and cell phone companies. In order to bring to market the 'laptop display in the Ipod form factor', they will need to go to Microvision. A magnifying glass over an LCD panel is not going to get the job done.

If you listened to the company's 3Q conference call, and take the company seriously when they say that the company is moving toward design wins in every single one of their development contracts for OEMs, then you are buying shares hand over fist while the company is worth $80M and no one thinks they can do anything right.

If you don't take them seriously yet, perhaps you will soon.


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