Covestor - Damon Blog

SCLW- Magic Monday and I predict Tuesday

Mon, 18 May 2009 18:05:39

I predicted todays run up here www.socialwise.blogspot.com, and am going out on a limb to say we should see another big day Tuesday. Im thinking we will break $1.10 on over 150,000 as momentum continues.

Related Stocks: SCLW

NEWS- SCLW- Bill My Parents Launches

Mon, 18 May 2009 18:05:50

BillMyParents Launches Unique Online Payment System for Teens and Parents

New Payment Processing System Enables Teens and Tweens to Make Secure Online Purchases, Parents Get Insight and Control Over Expenditures

SAN DIEGO--(BUSINESS WIRE)--Socialwise, Inc. (OTCBB:SCLW - News) today launched BillMyParents, an innovative online youth payment system that gives teens the freedom to shop online and parents the control over these purchases -- all in a simple, automated system that keeps credit card numbers and other personal information safe and secure.

Out of the more than $132 billion spent annually by youth, $40 billion is spent offline on products researched online. Lack of a credit card was cited by 40% of teens as the reason why they don’t buy online*. “The online teen spending market is hugely underserved and BillMyParents is uniquely poised to tap into the desire for teens to be able to shop online, while still letting parents maintain control in a safe and secure environment,” said James Collas, CEO of Socialwise.

The BillMyParents payment system platform addresses this untapped teen spending market with a multifaceted approach to online payment processing for teens and tweens, and gives them an easy way to purchase products online without a credit card. Using the BillMyParents button at the point of sale, teens can initiate a purchase in seconds. Parents complete the purchase at their convenience through a simple, easy to use, and automated system enabled by instant email and text notifications.

At launch, the BillMyParents payment system platform includes the following elements:

BillMyParents Shopping e-commerce site: To give teens immediate access to more than a million products, BillMyParents has launched a shopping site powered by Amazon.com through their associate program. The BillMyParents Shopping site (BMPshopping.com) gives teens and tweens access to the entire inventory available online on Amazon.com today, without needing a credit card to make purchases. Teens will be able to use the BillMyParents system to seamlessly make their selections and send parents their shopping requests to either approve or deny.
Partnerships with leading online social Web sites: To date, BillMyParents has forged unique partnerships with leading online gaming sites and social network applications targeted at teens and tweens, including Artix Entertainment, Habbo, Outspark and RockYou!, among others, addressing a total potential market of up to 100 million users across these sites alone. Scheduled to be rolled out into these, and other, partner sites in the coming weeks and months, BillMyParents is designed to easily integrate into partner sites, prior to the shopping cart or checkout page, in only a few days with minimal effort. This upfront placement immediately informs teens and tweens, who may not otherwise have a way to pay, that a credit card is not required to initiate the transaction, incentivizing them to request the purchase then and there. With an estimated $1.5 billion of virtual goods purchased each year globally**, BillMyParents provides a service that allows social networking and gaming sites to begin increasing revenues from virtual goods immediately.
Social network shopping application: In yet another way to reach the teen marketplace, BillMyParents has developed account management applications for leading social networks, such as MySpace and Facebook, that will let teens and tweens track their purchase requests made with BillMyParents, enable their friends to see their recent purchases, and rate products all from a dashboard on their social network profiles. Announced today, the social network application will be publicly available in the coming weeks.

BillMyParents is also currently focused on signing up large third party online retailers.

“Our partnership with Socialwise and BillMyParents adds a valuable and unique payment feature to our online role playing games,” said Daniel Vasile, business development manager of Artix Entertainment, LLC. “Many of our 80 million registered users worldwide are under 18, and by offering our young gamers and their parents an innovative, safe and easy way to make purchases and enhance game play, Artix is continuing to offer leading-edge features that enhance the gaming experience.”

BillMyParents is led by an experienced management team and advisory board, including CEO James Collas, who previously was the chief technology officer of Gateway and helped take it public. Advisory board members include technology industry veterans Maynard Webb, who brings 30 years of experience developing and leading high-growth companies including serving in the role of chief operating officer at eBay, Inc., and Joe Abrams, co-founder of Intermix, the parent company of MySpace which was sold to News Corp. in 2005.

How it Works

The BillMyParents system is ingeniously simple. Teens and tweens can shop online using BillMyParents, either via BillMyParents enabled social networks, virtual worlds or online gaming sites. Once they have made their selections, BillMyParents sends a notification to the parent or other adult guardian, by email or mobile text, through an automated, instantaneous system. Parents then review the teens’ selections and can approve or deny each request individually, or as a group. For the approved selections, the parent then enters their credit card information to complete the transaction. The whole process can be completed within minutes without the teen, or the merchant, ever gaining access to sensitive credit card details or other personal information. The simplicity and speed of BillMyParents lets the teen resume shopping or play without ever having to leave the e-commerce site.

About BillMyParents

BillMyParents is the innovative new youth payment system that lets teens and tweens shop online without a credit card, while giving parents the ability to easily track and control their teen’s spending. With a simple email request and approval system, BillMyParents provides the independence young people crave and the control over spending that parents want - while ensuring that credit card numbers and personal information are kept safe and secure. BillMyParents is currently available as a payment system in select online retail environments, in addition to social network, virtual world and online gaming Web sites. BillMyParents is a division of Socialwise (OTCBB:SCLW - News). For more information: www.billmyparents.com.

Related Stocks: SCLW

SCLW- Socialwise up nearly 300% in 18 sessions.

Thu, 14 May 2009 13:05:21

SCLW- Socialwise up nearly 300%

Socialwise SCLW, is entering a new phase. Returning to its old glory again perhaps?

Lets take a look at the chart:Red are sell days, green buy days (more buying than selling)

If the volume was not evidence enough that we are out of the woods, the price should be. From April 20th when we had a .26 Bid, we are up nearly 300%.

Thats nearly 300% in 18 sessions! Average Volume prior to this time was just over 30,000. Since then its over 100,000 shares daily. If your not aware a 20% increase in volume will generally garner a lot of interest. But 300% increase in daily volume? That will get people talking again (and has as evidenced by the share price).

Just in fundamentals alone, this stock is going to raise eyebrows. Although we may not look at fundamentals, but rather the company, many other investors do keep an eye on the charts, bid support, daily moving average , etc. What they see is a strong upward trend developing.

I also want you to notice the bid support that we have had. I am seeing a lot more "retail" bid support from the likes of Etrade and UBSS. UBS is what Charles Schwab and I believe Ameritrade use.

I think we have institutional buying that has been using LAFC, and maybe even Knight (NITE), telling me that some investors are jumping over to grab some shares that they deem cheap again. This is a very good sign. If this type of bid support continues, I think we close next week above $1 after the news hits. Not much in the way of short sellers, and if we can keep them away as we did the first time till we flirted with $2, this could again happen quickly. This time I dont see it sputtering above $2.50 however. Despite the fact that many of us still are below our average (those of you who havent averaged down) we are still looking great again.

Related Stocks: IDAE

Social Networking and Giftcards- IDAE Exciting revenue possibilities

Mon, 02 Mar 2009 18:03:08

Targeting the Gift Card market was the original business plan for IdeaEdge (Socialwise) by "group gifting" using "social networking". This adds a whole new way of marketing and selling gift cards by using one of the most popular new forms of communication (Social networking).

Although I will explain in more detail, If you dont understand any part of this concept, please see the investor media from IdeaEdge. Jim Collas does a better job of laying it out.

The Social gifting business plan was before "Bill My Parents" (if you havent read that blog, its a must.) and is the basis of the company originally going public. "Bill My Parents"was originally a back up plan (imagine that?) mainly to solve a problem with group gifting (how to target teens).

Fortunately here we are today with two viable business plans that will all but guarantee IdeaEdge (Socialwise) success.

Gift cards are a HUGE and growing business. In fact, majority of all gifts given today are gift cards. They are more personal and safer than cash, and guarantee you wont screw up a birthday/wedding Etc. too bad.

This is where IDAE comes in.
IdeaEdge's platform allows people on social networks such as Facebook to donate toward a gift card of the recipients choice. This is done using a group gift concept (although it can still be individual). The gift card of choice (lets say "Gap clothing store") can be requested by the recipient or one of their friends or family (average user has 120 friends).

To hopefully help you understand I'll use an example:

Say its my birthday and I decide I want a Gap gift card. First I pick IDAE's application (Called the "Group Gift card") on my Facebook page, sign up, and request from my friends that they donate to the Gap card(Basically it tells them I want a Gap card for my birthday). Lets say you are one of my friends on Facebook. As one of my friends, your own Facebook home page tells you its my B-day, and encourages you to give to me using the Socialwise (IdeaEdge) application.

This simplifies the process of gift cards. Just think, even if my friends knew I wanted a Gap gift card, they would normally still have to go out and buy one. Then I get stuck with several Gap gift cards with various amounts. With Group Gifting it is all on one card that everyone donates too. What is even better is generally someone would be embarrassed to give a $5 gift card, but in a group setting on social networking it would no longer be viewed as cheap. In this climate being able to give $5 instead of giving more than you can afford (or nothing at all) is a real bonus.

Now, instead of 1 person giving me a $100 Gap gift card 20 people can give $5 and I still get a $100 Gap gift card or another of my (or someone else) choice! (amounts will vary on how many people give and at what amount).

Now some of you remember the launch of the "Gimme" application ( now "Group Gift") on Facebook that I mentioned earlier. What you need to understand is that application is only used as a "showcase" by the Socialwise to show the product to application such as Rock you (biggest application maker on all social networking sites) whom they have contracted with. Its kind of like how Sony usually sells its products through big companies such as Best Buy, Target, Wal-mart etc. but yet they have a few of their own Sony stores. As its not Sony's main business to be a retailer, it is not Socialwise plan to be one either.

IDAE then would receive around $10-$12 of the sale of that $100 gift card.
Best yet Socialwise (IdeaEdge) collects the proceeds, so no worries of companies not paying or trying to renegotiate.

But really thats not the plan, It gets much better...

On Facebook/Myspace (Joe Abrams former company) you can choose what applications you want to load on your homepage to personalize your experience. The best applications become the most popular ones. So rather than try to make 1 application to compete to use on Facebook, Myspace, Etc, IdeaEdge has decided to wholesale out the group gifting idea and split it with the top application makers. Not only does this eliminate IdeaEdges workload (building applications) but it puts that role of application design and ideas into the application makers (experts) hands. Now instead of having one application on Facebook with the group gifting platform, you have 20, 30, maybe more, all competing for the same audience, with IDAE getting a half of all of others efforts.
So how would an application work? It really depends on the idea, but one idea I heard was designing a "group Birthday card" that everyone "digitally signs" and writes in that includes a gift card. If you want to be a part of the birthday card, you would need to donate to the gift card. Thats just one idea, application makers are pretty amazing at coming up with unique ways to market.
A popular application will almost always have more than 4MM users (birthday calender has nearly triple that). So even if only one or two (of say 20-30) of the applications become popular, we still should easily see an audience of over 10,000,000 active users. What makes this unique is ALL application makers are very interested since all of them are trying to monetize social gifting. Nobody has monetized social gifting yet.

IdeaEdge is going to be the first company with a viable way to monetize group gifting...(read that again). Yes the first. Most of you probably dont even understand how big that is. It is huge. Remember back when search engines like Google were trying to figure out how to make money by indexing the internet? Once they did, it became a multi Billion Dollar industry. Same type of thing here.

If you understanding this business plan you should, right now, be extremely thrilled.

Now we need to look at some hard numbers on what IDAE can expect.

But before I get to that, let me give you the first important 2 numbers I want to talk about: 150MM+ users....this is how many people currently use social networking! Thats a pretty big audience. Companies pay billions to get in front of a target audience like that.

Now lets look at the next number: Gift cards are currently a $120Billion+(2006) annual industry.

How can IDAE (Socialwise) tap into this market in a realistic, not some "pie in the sky" way?

To answer this, First lets look at the competition and what they have done:

Blackhawk Network launched in 2002, and currently they are the number 1 in the gift card business. By their 4th year they had made $50MM in profit. The next year $90+MM. This is profit, not revenue. I have not seen revenue numbers, but typically profit is around 10-15% for a big company with thousands of employees like Blackhawk Network has. Even at 20% profit, that represents $250MM in revenue in their 4th year alone. At 10% profit that is 1/2 of a billion in revenue, which is far more likely than 20%. So in 4 short years in business, Blackhawk had captured $250MM-$500MM in revenue in an industry that is up 50% since they launched. Maybe you havent noticed, but gift cards are everywhere.

How did they do it? The right contracts and connections. If you look at Ideaedges connections and contracts, you can see they are positioning themselves much the same way (with Myspace and Facebook and aligning themselves with other big companies). These contracts for Blackhawk turned into a pretty good audience by their 2nd year. Their product was in front of millions by being at Safeway grocery stores checkout counter (I believe Safeway now owns Blackhawk). Instantly you had millions of possible customers walking by your product. Since then they have branched out into other stores.

Still their potential audience was no where near the 150,000,000 Socialwise will have from day 1! The one catch will be that although they have 150MM potential clients, the product will be somewhat hidden until those people hear about it. It would be like Blackhawk only having their gift cards at 1 checkout counter in Safeway. However whenever someone bought a gift card, Safeway announced it over the loudspeaker the gift cards location (essentially what Facebook and Myspace do).
Also note: people spend far more time on social networking per month than at a checkout counter at the store.

Whats more exciting is that IdeaEdge (Socialwise) profit will be double if not triple that of Blackhawk. Why? IDAE's super low overhead. Blackhawk needs thousands in employees to do what Socialwise (IDAE) can do with less than 20! Jim Collas believes the company can do nearly $1 Billion in revenue with just over 10 employees. There is no product to store, no employees to work where houses and setup, no applications to be programed. Very little will be done in house.

Now that we have looked at the industry, now lets get into realistic revenue that IDAE expects.

By 4th quarter 2009 (when the company should be producing revenue as per their plan) there will be 40,000,000 DAILY birthday alerts on social networking.

If IDAE captures a very realistic 1% (400K) of that daily market at an average of $7.50 per person ($5 - $50 is the range for gifting).

Revenue to IdeaEdge will be $161,000,000.

Is that realistic?
Consider that the revenue will (hopefully) be split between 20+ applications, or only 20K people per application. Again let me point out that the TOP birthday applications get 4,000,000+ daily users!

So, yes, not only is it possible, its pretty low end.

Using that line of thinking lets get more technical. Lets say that between all applications they were able to get 15MM monthly users (again very reasonable, The very top applications usually get this many each) that contribute (on average) $7.50 to a birthday/anniversary/wedding etc. per month.

Thats a cool $198,000,000 in annual revenue.

This is VERY realistic because whenever someone on Facebook or Myspace adds a application it will notify all of their friends that they joined that application (the average person has 120 friends). If they like it, they can also invite friends to try it. See how quickly this can grow?

Now the real question.

What does this mean for the stock?

Two fold:

First)
Once IDAE (OTCBB:IDAE) starts showing revenue like this, they will attract quite the attention from the (Wall) Street. Typically a companies stock will trade 10-100 times its profit. In bad times its lower, and good, its higher. Right now these markets have slammed companies and pushed some good companies below 50 times profit,Example: Amazon is trading at approx. 30 times profit. Many companies make 0 profit, or even losses, and they are still trading, so investors look for companies that have high profit margin or stability and rewards them (Amazon does not have a very high profit margin).
Since Amazon is a internet company that supplies products, let me compare it to IDAE's sector.

So lets be VERY generous and say IDAE trades for only 5 times its profit. (This is low since investors will pay a premium for a start up company that is making 25%+ profit margins like IDAE should.) A fair number would even be 10 to 15 times...but I want to under sell my point....

So at $200MM in revenue, IdeaEdge should clear over $50MM in profit.

$50MM profit times 5 = a $250MM market cap.

$250MM market cap divided by 45 Million shares = over $5.50 per share! Or 14 times your money from these levels!

Again these are "dumbed down" numbers, I actually think the numbers will come in MUCH higher.

You might be thinking "But couldnt that take years to earn that profit?"

Yes, but do you think 10-15 times your money in a few years is bad?

We are talking "tech boom" type numbers. You think another investment will do that? What others? Real estate? GM's, Siruis or AIG's stock if they rebound...even another small cap? Good luck. I like the chances here (seeing what IDAE has already accomplished)

That being said, markets move down here(on OTCBB) on anticipation alone! Just the anticipation of the idea that IDAE will do $50MM in profit the next couple years can drive the price sky high! So $5 a share could be realistic in the shorter term as well.

What you need to consider is that these numbers are assuming "Bill My Parents (BMP)" FLOPS!

As I said before, I think BMP is MUCH bigger and better than group gifting (and so does IdeaEdges management as well as just about everyone who has seen both plans)

Take the low end of BOTH of these plans, "Bill My Parents"and group Gifting and realistically on the low end we are talking about a $7+ stock.

The high end being in the $40's. I actually dont think thats unrealistic if the company hits its goals. Thats a $1000 return for every $1 invested from the bottom levels! In that case does it really matter if it takes 5 years?

Now back to earth:
The Second way to get your Return on Investment- ROI)
An acquisition. Being that Joe Abrams AND Maynard Webb are very good M and A's (mergers and acquisitions) specialists, I think this is a far more likely scenario. Also keep in mind, great ideas like this rarely ever make it to market anymore. A big company is far more likely to pay top dollar to acquire a company like IDAE than let a competitor get it. Especially if there is a bidding war. I have no doubt that companies are going to be salivating over "Bill My Parents".

Payment systems alone are a hot ticket, with "Bill me Later" being sold in November for approx $940MM and Paypal selling for 1.8 Billion in 2002, both in down markets! The key with these was not revenue, but the number of users they had. (Bill me Later had only 3MM users).

Maynard Webb, who was the COO of Ebay at the time of the Paypal purchase has openly said he thinks IDAE has a better plan and service!

Not to mention that IDAE has two plans, not just one. That means one could be bought out, leaving us with a dividend check of say $5 per share and we still keep the stock!

I personally think a buy out is very likely, and that would happen quickly once they start building clients. Main thing will be to get the platforms out and get users on board. This could happen quickly (in a few months) or it could take a few years. Company plans on being profitable this year, and April/May will be big months to see how they hit their goals. In the meantime, this stock remains a STEAL!

Related Stocks: IDAE

Bill My Parents- the next Paypal for Teens

Mon, 16 Feb 2009 00:02:45

Bill My Parents- New Investor Media link

I have to tell you the first time I heard the idea back in June, IDAE was pursuing its other business plan simultaneously called Bill My Parents, I knew it was a home run. Jim Collas calls Teen, Tween credit/debit cards and payment systems the next frontier, just like cell phones for kids 10 years ago, and I must agree.

Like one financial guru once said "If you want to be extremely wealthy, all you need to do is find out where everyone is heading and get their first" IDAE is doing just that, putting themselves in a position to be first to market with a viable teen payment system.

Currently, Socialwise has focused the majority of their resources to Bill My Parents (BMP) because the management believes the BMP platform has a higher ceiling and marketability.

With a little research, its easy to see why.

Whats Bill My Parents?
BMP simply will allow a parent(s) to verify and approve/ disapprove a transaction of an item their kid(s) have requested. The next phase will include a debit card for kids that gives parents an enormous amount of control, and keeps it simple and convenient.

The first priority will be building an online store using a top retailer like Amazon to sell top selling products and offering the BMP platform as a payment option. This is perfect, since they will not need to try and find top sellers, or stock items, just use the retailer to promote their BMP product! Then BMP will get a cut of the sale, around 10%.

Lets break down the market.

First off parents are far more likely to buy non essential items for their kids then themselves, even if it means sacrificing their own desires. This is true even in a down market.

Lets look at one area of focus for the BMP product: video games, a multi billion dollar industry.

Think about marketing a video game. Currently the video game companies need to try to target a small group in their advertising approach. Generally they cannot advertise to parents, since parents really dont always know which games their kids like. So what they stick with is marketing to late teens to early thirties to capture the market that will respond to the ad and have money to buy the product. This is their main market. Of course younger groups will see an advertisement and bug their parents till their parents buy it for them, but this is only a bonus.

You must note, some of these games, and gaming systems will sell out in hours or days. We are talking MILLIONS of copies at $30-$60 each (not including gaming systems and controllers which can easily hit $400 or more)

So what if a gaming company could advertise directly to the 10-18 yr. old group? Basically BMP solves this problem for every company in this situation. They can market right to the younger kids and advertise "Buy this now with BMP". With the excitement about this market, IDAE has secured lots of discounted ads. This is a nice first step.

Now lets put this into revenue terms, since really thats all we care about.

From the numbers that have been thrown out there, the big target for payment systems is 3 Million users. This is using other companies who have been aquired. With the BMP application alone, this could translate into about $900,000,000 in acquisition value alone, or better yet $18+ per share. (this does not include social gifting only BMP)

How realistic is 3MM users?

With the marketing plan using the social networking platform, typically a “hot” application can reach over a million users in days. With the top applications reaching tens of millions in weeks. I think 3MM users through social networking and other ads in a reasonable time is VERY realistic. In fact, as great as this application is, I believe 3 Million is a very small number to the overall market.

Now the other part of the plan.

Bill my Parents Debit card:

Personally I think this is the golden Egg. The crème de la crème of the youth payment systems. A way to give your kid money, without giving them your card (Got your attention now?) Imagine loading your kids card with $200 and being able to:

- block undesirable merchants

- specify a safe merchant list that they can use,

- limit amounts at any merchant,

- monitor the card

- …oh and FREEZE (or unfreeze) the account at anytime with a simple text message or email. (When your kid gets grounded, why should they have the ability to spend money?)

Now add being able to simply add amounts to the debit card and parents have full control. These cards can be used anywhere MasterCard is used. Imagine the possibilities. I think this is where the company is headed for the long term. This in fact is a viable payment system for young people.

As far as numbers and profit, The market figures value at $1000 per user is reasonable for payment systems. So this means in terms of acquisition, 1MM debit card users would value that part of the business at 1 Billion. As far as profit, I haven’t been able to find any solid numbers, but you figure someone charging $1000 a year on average would be reasonable. (Note: this can be used for all a child’s purchases over a year, from school clothes and supplies, to gifts for friends and family). I would think revenue from that would be anywhere from 0.5%-1%.

5 Million users = $250,000,000 - $500,000,000

10 Million users = $500,000,000- $1 Billion

I don’t see why the profit wouldn’t be at least 20% maybe higher given the outsourcing. If thats the case we are talking profit in the $50MM to $200MM plus range.

Compare just this one small part(the Debit card) of Socialwise to "Heartland Payment Systems"

Heartland does 82MM in EBITDA and still holds a market cap of over $350MM! (thats after a 50% decline in the last 3 weeks.) Alone if the Debit card achieved the numbers above and translated into a value of 350MM in market cap, that would spell out over $7 a share.

Are you begining to see the big picture?

Now add that to the BMP platform (not to mention social gifting) and the numbers are staggering. This is a legitimate multi billion dollar company.

I think what is really exciting is this is just one business plan of IdeaEdge's that they are executing, and does not include social gifting which I will hit on later. Combined there is no reason in my mind they wont be able to rival a payment system such as Paypal.

Feel free to comment and ask questions.

Check out the site
Bill my Parents

Related Stocks: IDAE

Update on Company

Mon, 16 Feb 2009 00:02:29

I have a blog to update what is happening. www.socialwise.blogspot.com

Related Stocks: IDAE