Let’s talk about Microvision (MVIS)
Microvision was hyped up since May 2020 and it was not without reason. Since it triggered my spider sense, I decided that it was ticklish enough for me to do some research.
- A company that has a suitcase of patents.
- A company that has potential to target many TAMs (Markets)
- Lack of sales person to sell their products
- No cashflow. Reliance of stock issuance to fund R&D
- Someone just buy them please..
What is Microvision
First things first. Their website is bad, real bad. I get that they are cash strap and every extra cent goes into R&D but creating a better looking website doesn’t cost much nowadays.
Given that they are always trying to raise money, why not make their website more presentable..?
Founded in 1993, listed in 1996, peak at 2000 and then struggled to be a going concern for the world.
IPO-ed at the price of 27.51 and then peaked at 543 in year 2000…. Just exactly how crazy were the market in 2000.
I won’t cover much on how they were founded, IPOed and hyped that much up since it’s of no value. So let’s move on.
They website and presentation is set to confuse me rather than sell me their company but I think I get what they do. Their products:
1. Turn any flat surfaces interactive like my iPhone screen
More than a projector, by using infrared, an extra layer is created to let anyone interact with their device with any number of fingers in that space (seriously)
Watch this youtube video to see how amazing it is.
2. Make your glasses function like E.d.i.t.h
If you want to refresh your memory of the super glasses that Tony Stark gave Peter Parker, here you are: Video
An official video taken to sell the product by the company is here: Video
Basically, they allow projection in your visual space so you could save the trouble of holding your iphones.
3. Lidar — Turning cameras into eyes.
Not at the level of Tony Stark’s Javis. Current capability shoots beam and receive reflection, using speed of sound allows camera to understand the distances between you (i.e. Cars) and the object.
4. Hub for all your smart things in your homes
If you haven’t watched Zerg’s video on his AI home then here you are: Video
Essentially, this product wants the be the sensor for the hub that controls the other IoT in the house and with it, provide security to prevent hacking at the end-point level.
So, as I said in the beginning, what Microvision is positioning now is to be the enabler to make your devices smarter than it should be. Using camera, laser beams, receiver and sensors that are capable to measure the time of flight and thus making old flintstone object smart.
Revenue & Cashflow
Back to the reality part of the world. Numbers.
As it should be. Microvision’s revenue is chunky and unstable. Since they are selling products to be installed in other companies’ product to make a finished product that consumer need and wants.
The bulk of expenses comes from R&D cost, which is about 80–200% of revenue depending on which year you are looking at. Obviously this is unsustainable and need someone to fund their dreams.
Humanity’s dream of becoming Tony Stark is being funded by their equity holders. Smart choice since debt will be very troublesome for unpredictive revenue companies.
What’s the Hype?
With real world application becoming nearer to probability. The markets that they could target becomes very wide and speculators are looking at this as a very good position to be acquired.
In May 2020, It was mentioned in the news that Microsoft might acquire Microvision and from then on, the share prices bump up in value from $0.29 to $2.00
And once the hype is over, the share price temporarily went down before coming up to $6.60 at this current moment with some Lidar’s tech company like Velodyne, Luminar and AEye becoming public companies getting better valuation.
The management wants to be acquired and looking for the best possible valuation.
Stats of shareholding
As for the shareholders, 90% holdings are floats which could easily sell into the market when things come falling.
Being acquired has it’s own challenges as well since acquirer would need to buy from market at a higher price point in order for them to sell. There’s no 1 channel for investment bankers to talk to to negotiate on a price.
Therefore I don’t think I want to invest or trade in this company though I really like their products (for the future me).