Suppose, in your microcap investment research, you come across a tiny market cap tech company that was monetizing an entirely new medium.
You’d take note and look a little deeper, eh?
Us too.
Suppose further that this <$15M market cap company:
- just posted its first 7-figure revenue quarter ever.
- is a SaaS provider where companies tend to, at scale, trade at 8-10x revenue.
- has guidance set for 10-15M dollars revenue this year.
- is partnered with the biggest names in tech and retail.
- is positioned to scale immediately to service pent up, potential $200B demand.
Interest piqued?
Read on.
Innovative VSBLTY Groupe Tech Could Put a Smile on Your Face
We’ve got our eyes on a software as a service (SaaS) microcap company and suggest that you should be all ears, as its potential could make your cheeks flush and hair rise. We’ve got a nose for success and today point our chin and give a nod to VSBLTY Groupe Technologies (CNX: VSBY; OTC: VSBGF) for its innovative and transformative positioning in the fast-emerging facial recognition (FR) field. With proprietary artificial intelligence (AI) and machine learning SaaS, Philadelphia-based VSBY is establishing its presence as both a powerful retail marketing tool and a smart enhancement of video-based security—sometimes in concert with each other. VSBY’s technology is already generating revenues and attracting significant attention, while the company has also been establishing numerous partnerships that are expected to help the company scale up rapidly with a corresponding boost to revenue generation.
As an aside, we should point out that COVID-19 has caused a slowdown of software installations, which in turn has caused a lowering of projections. However, we believe this just helps extend the current time frame under which VSBY will remain an undervalued buy, but this extension will be short lived once the company’s potential is recognized. Consider that SaaS companies, once at full scale, often trade at eight to 10 times multiple of their top-line revenues. VSBY recently recorded its first seven-figure revenue quarter and reported full year revenue growth that exceeded 250%. The company’s latest guidance suggests full year revenues of between $10 to $15 million–while at the same time having market cap also in that range.
Company Powered by Innovative Software Products
VSBLTY’s business model is currently focused on three distinct software products that can work stand alone or with each other:
- VSBLTY Vector™
- DataCaptor™
- VisionCaptor™
All three, it should be noted, are programmed to be fully compliant with privacy laws around the world and maintain the anonymity of people viewed. Though customers interacting with VisionCaptor™ can opt to legally disclose their identities and other information.
VSBLTY Vector™ represents the company’s linchpin FR technology and combines computer vision and machine learning to identify individuals and/or objects, whether singly or from among crowds. The software can be directed to search for person(s) of interest, specific facial characteristics, and/or suspicious objects. This can be invaluable in high-traffic public areas where the software can identify potential targets in milliseconds and instantly notify security officials accordingly. The software is most effective when embedded in cameras located in display screens used for information or marketing purposes, but VSBLTY Vector™ can be interfaced with any IP camera. It can also be linked to closed, non-cloud database systems, and utilize programmed biometric data rather than data from the Internet.
FR tasks that can be programmed into VSBLTY Vector™ include:
- Facial detection
- Object (weapon) detection
- Facial verification
- Facial ID
- Object (weapon) ID
- Facial similarity detection
- Emotion detection
- Motion detection
- Facial grouping
- Image analysis
- Facial verification from video
- A-List celebrity recognition
- And more
This FR technology for security purposes alone can make the company moderately successful. Consider that VSBY has a contract to install VSBLTY Vector™ on 40,000 cameras in Mexico City. Thanks to technology breakthroughs and partnerships with other tech companies, the overhead costs of installation and maintenance are going down, which means more monthly profit to the bottom line from each of the 40,000 VSBLTY Vector™ installations. So far, VSBY has completed about 3,000 installations due over the 3 year, $10 million contract.
“We have gone from the 11th Safest to Number One during 2019. The single major contributor to this change is the camera network that is not even fully installed yet.”
Mayor Adrian Ruvalcaba
This first stage roll out saw pioneering Cuajimalpa County go from 11th safest in Mexico City all the way to the number one safest county in Mexico City. The 40% reduction in crime garnered endorsement from politicians, including Cuajimalpa Mayor, Adrian Ruvalcaba. Based on Mexico City’s initial crime prevention success through VSBLTY Vector™, the company is currently in talks with other cities and countries to add the software to their security camera networks and the software is currently being tested in several Colombian cities.
VisionCaptor™ and DataCaptor™ Create a Powerful Marketing Tool
VisionCaptor™ content management system allows companies to bring proximity aware, interactive brand messaging to life on any digital screen or platform. Marketers can use VisionCaptor™ to display photos, animations, video, and multimedia content in their messaging, and utilize other tools, to create a unique customer experience on digital displays, which can be located in retail spots, transit hubs, and sports and entertainment venues. When combined with DataCaptor™, marketers can accurately track and measure the success of their messaging campaign and then revise or tailor the VisionCaptor™ messaging accordingly.
DataCaptor™ uses artificial intelligence in camera and sensor devices to capture real-time analytics and audience measurement. Embedded within cameras in interactive video displays, such as those created with VisionCaptor™, DataCaptor™ collects real-time anonymous audience data, such as:
- People counts
- Engagement counts
- Content engagement
- Dwell time
- Interaction time
- Age ranges and gender
- Emotional sentiment
- Recurring visits
Digital marketing is all the rage now, but marketers still struggle with accurately gauging its effectiveness beyond counting customer impressions (also known as views). VSBLTY gives marketers a digital marketing tool with VisionCaptor™, and, with DataCaptor™, the means to learn customer behavior and track marketing initiative effectiveness in real time.
Consider the case of Sargento Foods, Inc., which used VisionCaptor™ on free-standing refrigerated coolers with transparent video screens to provide customers with recipe suggestions for a variety of holiday meals. Suggestions changed according to time of day in order to feature breakfast, lunch, and dinner ideas for the company’s cheese products. Price points could be instantly updated to correspond with any sales promotions at specific locations and the interactive touch screens helped customers identify specific cheese products by displaying packaging images with the chosen recipes.
Meanwhile, DataCaptor™ provided the company’s marketing department with an in-depth look at store traffic in the dairy aisle and insights into the demographics and sentiments of those showing interest in Sargento cheeses. All data was delivered to Sargento marketers in real time via the cloud, which helped them tweak VisionCaptor™ messaging for better customer targeting.
Combining Security with Marketing Analysis
As previously mentioned, VSBLTY tools can be used for both security and marketing at the same time. For example, a Fortune 50 company’s security detail partnered with VSBLTY to provide security for the company’s exhibition at the 2019 Consumer Electronics Show in Las Vegas. VSBLTY ringed the exhibit with 19 VSBLTY Vector™ enabled cameras embedded in digital signs. Using a database of several hundred “known” persons who represented an active threat to the client and its brand, the digital watchdog was able to provide instant notification to security whenever a person of interest neared the exhibit, allowing a quick response and evaluation of potential threats. The system also tracked exhibit visitors, providing key marketing information relating to numbers, genders, ages ranges, traffic by hour and day, and popularity of displays within the exhibit.
Bulking Up Through Partnerships
VSBLTY has signed dozens of partnership agreements in the past year, with some geared toward enhancing the partner company’s existing technology, some geared towards expanding and/or enhancing VSBLTY tech capabilities, and others tailored for sales. With regard to the latter, VSBLTY has a sales contract with Microsoft making the software giant, with more than 13,000 software sales specialists, a VSBLTY software vendor. The company has a similar agreement with UST Global.
To boost its marketing company initiatives, News America Marketing (NAM) has partnered with VSBLTY to jointly offer advanced digital in-store media analytics to retailers and other brand marketers. The agreement merges NAM’s digital signage with VSBY’s DataCaptor™. VSBY has a similar partnership with Sensormatic Solutions, though VSBY’s tech is also being tested for loss-prevention control.
The company has initiated two different partnerships to expand the use of VSBLTY technology for COVID-19 screening purposes. One partnership is testing the use of VSBLTY’s existing technology for crowd temperature scanning, while the other is focused on developing multi-sensor camera capability for building security to screen authorized visitors for COVID-19 symptoms while checking biometrics.
Powerful Leadership Team
VSBLTY’s three co-founders represent more than 80 years of impressive experience in the tech field. Co-Founder, CEO, President and Director Jay Hutton has more than 25 years’ experience as a seasoned software executive climbing the ranks at Gandalf Technologies and then Ascend Communications until it was bought out by Lucent Technologies. After this Jay spent 10 years as president and CEO of a privately financed company that ultimately went public, and, prior to starting VSBLTY, managed the introduction of electronic payment option/in-vehicle media outlet stations to New York City’s 13,000 taxicabs.
Co-Founder and Chief Technical Officer Tim Huckaby, who managed the company’s initial development of VisionCaptor™ and DataCaptor™, came to the company with 25 years of Microsoft engineering know-how. During his Microsoft tenure, Tim founded Interknowlogy, the software arm that developed the technology used to power CNN’s election night “Magic Wall.” Tim has been repeatedly recognized by the news media as a “Pioneer of the Smart Client Revolution,” and is well respected by his peers in the tech field.
Co-Founder and Chief Operating Officer Linda Rosanio began her career as a media director responsible for her ad agency’s planning and buying of media from radio, television, and billboards. She founded her own agency in 1985 and over the next 30 years grew the company to 230 employees who helped generate $100 million in sales. Her in-depth knowledge of media, client services, and retail and service market mentality, is a key driver of the expected continued success of VSBLTY.
Expect This Company to Soon Shift into High Gear
As you can probably tell, we can’t maintain a poker face with this company. For all of the reasons suggested above, we rate this undervalued microcap as a strong buy. Consider first that the company has guided revenues for the year that come close to matching its tiny market cap of about $15 million. Recent initiatives and partnerships have led to significant revenue growth over the past year that should continue to expand especially once the COVID-19 pandemic starts to ease.
And, speaking of COVID-19, its partnerships to develop COVID-19 sensing as part of its technology offerings represents another strong tranche of potential revenue generation. As does the recent Black Lives Matter protest-inspired rioting and looting and resultant calls to defund or reform the police. Security cameras have proven to be a valuable tool for law enforcement—combining them with facial and weapons recognition capabilities makes them that much more invaluable. With billions of dollars in rioting damages in cities across America and a push to limit police presence, municipalities are going to be looking for other tools, such as VSBLTY’s technology, to maintain order and help denuded police forces fight crime.
While VSBLTY does have some competition in the FR space, its patent pending FR analytical technology is groundbreaking and provides the company with a competitive advantage over its FR peers. Not only will VSBLTY be the only company offering the FR advanced analytical tech provided by DataCaptor™, but this can help push sales of the company’s related tech over that of competitors. The company’s ability to meld security and marketing FR tech adds additional water to VSBLTY’s economic moat.
Given the company’s rising revenues, exciting partnerships, and apparent reductions in operating costs, we expect to see a significant gearing up on future revenues and subsequent boost to the company’s bottom line. Little doubt that such gearing up of revenues, combined with the company’s technology, would make the company an attractive candidate for a buyout.
