It has been a while since I have written about Ivrnet (IVI.V), so I thought it was a good moment in time to write a little bit about what I am seeing as the company continues to aggressively move into 'sales' mode from 'development' mode for its new product offerings. If you remember from my original investment thesis on the company, one of the reasons I find this company to be a very unique investment opportunity is that a very large margin of safety exists, in my opinion, from the company's legacy's products. While the recurring revenue base that the legacy products provides is starting to decrease, the efforts of the company to grow its sales in its new product offerings should results in significant incremental revenue and profit growth.
On April 12th Ivrnet released news that its NEXTEXT product has been launched to the North American market. After many years of development the company clearly feels the product has been validated from a technology standpoint and is ready to be scaled across North America. The beauty about NEXTEXT is that is reduces expenses for transit authorities, which should make it a much easier 'sell' for Ivrnet.
Chris Topolniski , Chief Operating Officer, Ivrnet Inc., comments, "Through in depth discussions with strategic partners ranging from the Government of Canada , anchor Transit Authorities and end-user ridership focus groups, we have designed and packaged the NEXTEXT product suite with the sole purpose of assisting public transit authorities in decreasing the large monthly operational expenses related to aggregation costs." He continues, "Our unique technology and business model turns these traditional high cost centers into profit centers by providing opportunities for digital sponsorships, while complying with both the spirit and letter of antispam and privacy legislation."
The "Geo-targeted NEXTEXT bricks" (as shown below) demonstrates the very exciting aspect of this technology that will one day, in my opinion, allow the company to scale the technology well beyond transit authorities. Think about this...you could receive an immediate coupon via text message if you are within close proximity to a certain Starbucks, for example. The possibilities with the technology are both exciting and infinite, and I expect the company to capitalize on these opportunities in the coming years. But, let's not get ahead of ourselves! The company is already in discussions with 20 North American transit authorities that represents a potential of $7M in new business.
What makes this all very exciting about Ivrnet is that NEXTEXT is just one of their new product launches. The company's legacy products will continue to provide a nice margin of safety, and as NEXTEXT scales and as other new products are released by the company the opportunity for a significant uptrend in revenues and profitability present one of the best risk-reward scenarios I have ever come across among microcaps.