Interesting that the site talks about, “ ..from small networks to global distributed hyper connectivity.”
Its easy to see the value for the large companies. If the rumour is right that one of the big networking projects in China is for JD.com that will include the integration of Walmarts 420 stores in China and the on the ground networking of Dada-Nexus delivery motorbikes, vans and drones in 300 Chinese cities and possibly in the JD stores in Thailand and Indonesia. JD also has about 36 warehouses in Europe serving delivery to the large Chinese populations in the EU and the UK.
How far we can take this is the big question, but in my experience big companies tend to go all in with a technology once they adopt as it gets too confusing to have different systems. For example the contract ( this is just hypothesis mind you) could extend to FarFetch, the luxury goods platform which JD bought into three or four years ago. It has a $14 billion market cap so is no slouch, but while this is not a logistics issue for FarFetch as it is only a promotions platform for these high margin brand companies, very likely the arrangement includes preference logistics for these watch jewellers or super expensive handbag companies with Dada-Nexus for the Asian leg of the delivery.
The big issue to keep in mind is the titanic struggle between Amazon and Wal-Mart in the US and to an increasing level globally as well as the equivalent struggle between Alibaba and JD/Wal-Mart in China. It is far more complex than this as Costco and a dozen Chinese versions of Costco, plus Aldi and the Schwarz Gruppe’s Lidl and Kaufland are battling away, but beyond competition at the goods and payments levels, there is the underlying issue of securing all the unseen logistics messaging which is now often, or even largely, cloud based.
The tantalising aspect is that the VSN is accredited for JD Cloud, but also Ali Cloud and,for that matter, Azure as well, and also seems to be working with several private Chinese cloud service companies.
There is also a rumour that Bytedance is somewhere in the picture too. As it hosts almost 2 billion short videos a month (WSJ) that would create plenty of opportunities for sabotage or criminality. I’m not suggesting that anyone rushes out and buys some more NET on a vague rumour but there does seem to be much more substance to Netlinkz than the market realises.
Netlinkz does confirm that there are now something like 130 staff in six or seven separate locations which suggests on the ground person to person meetings, site visits etc. What are they all doing?
One only needs an little experience of capital raising to be intrigued by the capital raise earlier this year. The funds who went in were tough minded investors but who place a great store in winning and not backing losers and yet backed a small still obscure company operating in China of all places. Their due diligence must have revealed some quite interesting potential beyond the World Bank Project.
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NET Price at posting:
3.2¢ Sentiment: Buy Disclosure: Held
(20min delay)