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Hmmm. Tough week, and only two days in. Look, everybody. It's like this. I don't know what's going on right now. But let's be realistic. The company put $10M in the bank this month and they've got $18M worth of LMRA. Even in a really conservative scenario where revenues and costs stay at the same levels, and the LMRA asset doesn't budge, this is over a year's worth of money. [Updated 12/8. Clearly there will be another funding event before too long, but stay with me here.]

This gets us to the end of 2006, into 2007. It took MVIS two years to go from Nomad I (2002) and its kind of bulky look to Nomad II (2004) which is pretty darn sleek. Based on our development history, we are on pace for a new dramatically slimmer, lower cost Nomad sometime in 2006.

We await the "strategic roadmap and vision for the next 5 years, transplanting it from General Electric, implementing it at Microvision" that was mentioned by Mr. Tokman on the 3Q conference call. We will "place our biggest bets on our most promising opportunities."

The roadmap and vision will probably lay some things out for investors and everyone else: Change is coming. Focus and direction are coming. Operational improvements and strategic vision are coming to Microvision and MVIS investors will benefit. The current doom and gloom reflected in the stock price does not square with the reality of the situation, which is that there are numerous potential hit products in the company's pipeline: MicroHUD, Picoprojector, Surgical microcamera, Next-gen Nomad, LED Widescreen occluded HDTV gaming/multimedia glasses, occluded edge-emitting LED 'Point Source' platform, among others.

Now tell me this -- if there was a startup biotech company with at least six really promising drugs in its pipeline, with huge potential markets, do you think they'd be worth just $52M over their cash and equity positions? Me neither. So, it doesn't make sense to me. Never mind that all drugs to be sold in the US need FDA approval which is a huge overhead of time and money.

The market is basically saying they don't believe that Microvision's products exist. But I have seen some of them and know for sure that they do exist. And they are awesome. I would suggest that the company needs to do a better job communicating their product pipeline and illustrating these products' advantages over competitors, or how these products do things that no competitor can do at all.

So, the deal is this. This company is not going away. They are going to continue to engineer incredible technology. And, now they are being led by a proven manager from the world's best run company, with a history of generating revenue growth from bleeding edge technology products. Microvision is going to continue to receive funding from the military to bring successive generations of life-saving situational awareness tools like Nomad to soldiers and pilots. They are going to continue to receive funding from partners like BMW, VW/Audi, et al to further develop and improve the astonishing MicroHUD, with an eye towards mass adoption later this decade.

I've seen the Spectrum full color, see through laser display. It is just incredibly awesome. And it is going to be in a wearable configuration by the middle of next year. Get your head around this: the inexorable, impersonal forces of progress are pushing this company forward towards the promised land -- where every man, woman and child in the civilized world owns or interacts with multiple products with Microvision's scanning engine inside on a daily basis.

The market hasn't exactly 'priced in' the probability of that scenario into MVIS shares just yet.

My feeling is, as the opportunities become clearer, more attainable and nearer term, the market will start to bet heavily on the likelihood of the only acceptable outcome: total success.

This is my world view and the only thing that I understand. The world outside, that is punishing MVIS on a daily basis over the last two months, I can't understand it. But these huge impersonal forces like Moore's Law and the Law of Accelerating Returns, I get these. It means that time is on the side of those who are long high-technology stocks. That what is acheivable during 2006 may be ten times or 100 times greater than what was achieved in 1996. With focus, direction and a strategic roadmap and vision transplanted from General Electric, anything can happen for this company and it's owners.

It's a long term deal, working with OEM companies that operate on their own timelines and with their own (secret) product roadmaps and schedules. So it's kind of stupid to complain too bitterly about revenue not going through the roof in the immediate term. Much more important than that is to establish good relations with these partner companies and take the time and effort to ensure that when the partnership is consummated and 'MVIS inside' is OEMed by a partner company, that the technology handoff is smooth, the royalty rate is looking good and the product is a smash hit when it is rolled out. It is all about the OEM strategy, putting partnerships in place and delivering killer technology that's manufacturable on a huge scale. That's the real challenge, every bit as important as generating product revenue now with Nomad.

That's my view and I'm sticking with it. So...who's with me??? Feeling a little bit insane and kind of helpless over the last few weeks. Sometimes I'll have a moment where I'm looking back on this moment in time from 2010 or thereabouts and I'll tell my present day self, 'see, everything works out fine!' Those are good moments. I'm going to hang on to those.

Kiss your wife, hug your children, pet the cat and walk the dog. The work of building the future can never stop.

9 comments:

At December 7, 2005 at 5:59 AM Anonymous said...

I agree with all you said o Dec. 6th , but you fail to mention the impact the short selers and the market makers are having on this stock . I do believe that the stock is about to bottom out , and it is a great buying oportunity right about now. It will probally be another year to 18 months before we see real movement upwards in MVIS , but I do agree with you that it is coming. Keep up the great work.

 
At December 7, 2005 at 8:30 AM Rob said...

Great summary Ben. I am there with you and I believe we will both be celebrating the decision to stay long
Rob

 
At December 7, 2005 at 8:50 AM Anonymous said...

I'm a bit nervous but staying long. The potential is too big to pass up....

 
At December 7, 2005 at 9:08 AM Ben said...

thanks everybody. appreciate your comments a lot.

 
At December 7, 2005 at 9:21 AM helloseth said...

I'm wit'cha too.

 
At December 7, 2005 at 10:34 AM Anonymous said...

Me too. Hang in there -- this dip is just anomaly and will fade into irrelevance in the near future. Just adds to the great story we'll all tell... 'I was with Microvision when...'.

Meanwhile -- have you checked out these guys? http://www.intelliscanner.com/index.html They're building an entire business around Flic. Pretty cool stuff, too.

 
At December 7, 2005 at 1:14 PM Anonymous said...

Ben is right. There are so many things going on with MVIS that its easy to see they have a very bright future. It'll all work out.

BTW, I bought more today. I couldn't resist the price.

 
At December 8, 2005 at 2:42 AM Anonymous said...

money will last for only one year at current burn rate. not two. sorry to say, but we all know mvis has some serious managment problem. i just hope A.T. can fix it, before it is too late. salary and outstanding loan of RR is a bad joke. i am still in, because of the technology.
but i am not willing to buy another single share before mvis has outlined a serious businessplan to reach profitability and even more important how they will get appropriate financing.

greetings from germany

 
At December 8, 2005 at 9:37 AM Ben said...

German guy might be right about burn level. I'm sure the burn rate will be reduced when Tokman's plan is implemented but I've updated the post to be on the safe side. The point remains the same.

Tokman's plan due by end of year.

With a real plan and hopefully some real cash in the bank before too long, we could be singing a different tune in a while...right?

 

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