Ann: Investor Webinar - August, page-13

Well overall I think that was a very good webinar. I hope that calms a lot of people down, as things seem to be well on track. Dave answered a lot of questions. A few things I jotted down notes about:

- The 500k+ of accounts receivable is mostly from two companies. The largest cloud customer (has to be Thor) and the largest reseller (Digicel?). The company expects them to be paid within days or weeks. It's a result of the 30 day payment terms that buddy has, and so we can expect to see $$$ on the accounts receivable line every quarter.

- Dave reiterated that they will not share detailed sales info, however he committed to eventually sharing more info when no single reseller accounts for more than 10% of total sales. This will happen by either growing the reseller channels or greatly increasing direct sales. Side note: Dave could have easily just said "not gonna share the info" and move on, and so I think it's great that he set a target for saying "yes ok, we will now share more detailed sales info."

- Around 25% of customers add on to their systems within the first three months.

The backlog. On July 31st the backlog was 33 customers. As of today it is 23. (I like how Dave just told us the exact numbers. Transparent enough for you?).

- Some returns of product from early customers "who were not a good fit." Excluding those early customers, churn rate is about 5-7%. He noted that most customers have not had the product for a full year so the data on churn is not complete.

- Some of the selling pressure this past Q was due to two hedge funds unloading 60M shares. One fund liquidated and one was a "forced seller" (I'm not sure what that means).

So yeah, overall good stuff. Sounds like they are chasing down a lot of direct sales leads. I'm sure they are busy and I'm happy to continue holding and let them getting grinding away.