simon crowther, page-81

Hey Blastoff,

The only real reason for a business to licence off a new business model product is when one is capital/resource starved. And upon licencing in those conditions, very good chance the originator has/will loose control of the outcome.

And lets be frank, this is not going to be a franchise model unless $100m + royalties++ are on the table.

Its called MoD. "Master of Destiny". NEA's product is an IP barrier, not a capital barrier. It doesnt need $20+'s of $Ms to duplicate into other markets/countries.

What makes this 'fairly unique' compared to the hundreds of other incredibly fantastic Aussie ideas/products that we see deserving of conquering the world..but usually get swamped down.....is....these guys are international IP gurus!

This affords NEA the real and rare opportunity/title of MoD.

The value of this is so enormous on a new product/idea/plan. It defies normal investment/comparative metrics.

So often do we see great ideas capitulate/licence to the "big boys" and the proponent and their shareholders initially congratulate themselves only to wither within a much bigger, longer term plan of the big boys which is to essentially crush new ideas that bump their bigger picture.

I give but 2 examples.
1) CSL: sporned out of govt, had plenty of pre-IPO offers for <$50m to licence/sell out to O/S interests. But they held/fought for their IP.
2)WPL. Yes; Aust's largest pure energy play. It doggedly held onto the operatorship of the NW gas fields in the face of the largest energy coys in the world. They knew it was the key to controling their asset.

But even these guys needed $100m's and $B's to remain MoDs.

NEA doesnt. The value add for pursuing a few other markets, over 2-3 years is going to be measurable in factors.

The cap cost of this model is a fraction of its revenue, it will of course get challenged. I too have concerns that the model will get blasted out. But I have absolute faith that their technology IP will be safe. So they now have to run as hard and fast to grow the biz, develop new markets. Its a 3-5 year plan but I suspect if they are marginally successful, AS THEY ALREADY ARE, they will get taken out.

But Norgard is the gate keeper. I'd be very surprised if he approved licencing out. It would be an unecessary capitulation. He simply doesnt have to.

The premium of MoD is just too high to ignore.

Cheers.