Letter from the CEO – October 26, 2018

By: Robert Grosshandler | October 26, 2018

The Holidays!  The Holidays!!

Stop reading this, go shop at iConsumerTell your friends to shop at iConsumer.  Building the business is my job number one.  I’m sharing my job with you <grin>.

Then, and only then, should you read this update.

Overview

The first thing I do each morning is to check out the price of RWRDP.  Traded on the 25th at $.18/share.  (That’s up from $.16/share.) A great start to the day.

Then, I think through what we need to do to build the business to be bigger and better.  We’re in the middle of analyzing the results of a member survey we just performed.  We’ll dig into that a bit in this letter.  One of the comments that was repeated was “more marketing”.  To share some of what we’re doing in that regard, this month I’m going to discuss our PR (public relations) and IR (investor relations) efforts.  Another frequent comment was “more stores”.

After that, I like to make sure we keep the SEC happy.  To that end, we’ve just launched our rescission offer.  I’ll discuss that, too.

Lastly, I’m going to recap the member acquisition math that we use every day.  At this stage of our growth, I think they’re the most vital KPIs (key performance indicators) we have.

Unicorns and Surveys

A unicorn, in startup-world parlance, is a company that is worth over $1,000,000,000 (that’s a Market Cap of 1 Billion Dollars).  Think Uber or Tesla.  We’re not quite there yet as of 10/26/18:

I would really like iConsumer to be worth more than a billion dollars …

As part of our search for memorable marketing language, I was all in favor of referring to our journey to becoming a “unicorn”.  Our lead marketing person said “too trite”.  So we didn’t.  But I’m stubborn, so we asked our member/investors in our survey (still not too late to finish yours) if they were familiar with startup “unicorns”.  Not so much:

No offense to Lisa Frank©, but we won’t be using unicorn language in our marketing efforts anytime soon.

Member Survey

If you haven’t filled out your copy (we emailed member/investors who have opted-in to our special newsletters a personalized link on Tuesday), please do so.  We’re getting great response, lots of insights, and demographic data that will help us to better sell advertising and our other services.

Some of the questions were open-ended.  I already know that we’re going to keep up, and maybe increase, our member/investor communications.  Here’s why:

Number of Stores

We have over 1,900 stores now.  With that many stores, even I find it impossible to keep track of each store.  I rely mostly on the iConsumer Button.  With the Button installed on my browser, I just Google what I’m interested in buying, the Button highlights those search results that are from iConsumer stores, and I click the link.  Voila.  I’ve saved money, and earned a bigger piece of the iConsumer pie.

I also use Amazon a lot through iConsumer.  Walmart, too for that matter (I never used to shop at Walmart, but now they’re good competition for Amazon, and my purchases there are tracked directly to me, unlike Amazon).  Purchases at Amazon make iConsumer money, which helps our profitability, and hopefully helps our stock price go up.

We take suggestions for stores we should add.  Be sure to let us know any of your faves that we don’t already have.

Public Relations

One of the quick learnings from the member/investor survey is that our member/investors want iConsumer to be more visible.  They believe it’ll help them as they spread the word about iConsumer (more familiarity and credibility).  We agree.  Early this month we retained a PR firm to help get us out into the public eye more.  You’re never guaranteed results with PR, but we have a great story.

One of the first tasks for the PR firm is to help us make our story really short and sweet.  I think the way we currently describe ourselves is a little too complex to be shared easily.

I believe that to be really successful, we have to make it drop-dead easy for our member/investors to share this story.

Investor Relations

It’s equally important that the investment community is aware of iConsumer. Pitching stories to financial publications and investors is fundamentally different than to consumer-focused outlets.  The firms that specialize in this kind of work are called Investor Relation firms.  We hired one of those this month as well.

The goal here is to help support an ever-increasing stock price (but the price will still fluctuate up and down). Eventually, we’re going to consider the advantages of being listed on a stock exchange (think NASDAQ), as opposed to being quoted on the OTC market, like we are today.  The regulatory compliance costs associated with being listed are much heavier than our costs for being traded on the OTC.  The traditional advantage of being listed is a higher stock price and more liquidity for shareholders. It’s a balancing act.

Additionally, our investor relation firm will help to make us more visible to prospective investors.

Rescission Offer

Today, the SEC qualified our rescission offer.  Because we didn’t have a qualified offering from February 13, 2018 through May 23, 2018 and we accrued the earning of shares, the SEC believes we need to offer member/investors the opportunity to rescind the shares and Bitcoin earned during this time period.  While we don’t agree with them, it is far easier to make the offer than to argue.  You can read much more about the offer here.

I don’t expect the offer to have a material effect on our cash position.  However, if a lot of people do take us up on this, it will negatively impact our available cash.

Cash

As always, it’s a concern.  We’re still not cash flow positive, so we rely on investors like myself to fund our operations.  Once we have the first phase of our PR done (the tuning up of our messaging) it’s our intent to start spending money again on outbound marketing.  That will be dependent on our continuing to be supported by our investors.

Member Acquisition Math

This is the most important math right now for iConsumer.  How much cash does it cost us to gain a new member; how much cash does that new member generate for us; and how soon after they join do they generate cash (above & beyond the cash we spent to acquire them).

That first number – the cost to acquire, is typically called Customer Acquisition Cost – CAC.  The second number is Customer Lifetime Value – CLV.  The last number doesn’t have a name.  In some industries (like rewards credit cards), it can take years for a customer to pay back their acquisition cost.

Right now, our CAC is less than $10.  It’s too soon to truly know our CLV, but we’re estimating $75.  What is very cool is that less than 60 days after the average new member joins, they’ve paid back the $10 we invested (they shopped enough so that they got rewards plus we made money after paying those rewards).

Consider investing

We’re currently selling stock at $.15/share.  Last trade was at $.18/share.  We’re investing your investment on marketing.  We’re early stage, risky, and lots of fun.  Be sure to read our offering circular for all the details.  Visit here to invest.

P.S. Didn’t get the Lisa Frank reference above?  Ask a millennial.  That’s what I had to do.

 

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8 Comments

Tammie Meadows, October 26, 2018 at 2:39 pm

I missed the video on if I wanted to cash out of I consumer stockor Bitcoin stock

Dartanyan Terry, October 26, 2018 at 3:16 pm

I am having a blast investing in this startup opportunity. I am learning about stocks and investment through this opportunity. I appreciate the learning curve overall.

Looking forward to continued growth.

Thanking you in advance!

    Kim Logan, October 26, 2018 at 5:03 pm

    Great having you along for the ride!

Phrost, October 26, 2018 at 4:51 pm

is there a benefit to using iconsumer button on amazon? i thought they don’t do cashback partnerships?

    Robert Grosshandler, October 26, 2018 at 10:36 pm

    You’re right, there is no benefit specifically at Amazon. But keep it downloaded and installed, because there are 1,900 or so other stores where it does benefit you. I have Amazon as a favorite store, so it’s one click away. And while Amazon doesn’t allow us to credit you personally, iConsumer DOES get credit. It’s a profitable relationship for us.

Kyle, October 26, 2018 at 8:32 pm

What is the current cash loss and how soon can we expect the company to have a positive flow?

    Robert Grosshandler, October 26, 2018 at 10:33 pm

    We can point you at our most current financials here: https://www.sec.gov/Archives/edgar/data/1652350/000114420418051092/tv503490_1sa.htm

    And our discussion of those financials here: https://shareholderacademy.iconsumer.com/blog/iconsumer/letter-from-the-ceo-form1sa/

    Elsewhere we’ve estimated that we need to raise another $250,000 to $500,000 to fund growth that should bring us to being cash flow positive. Like all estimates, that’s subject to change, market forces, and other things, so there’s no guarantee that we’ll be cash flow positive after that. Be sure to read our disclaimers whenever we talk futures.

    Here’s one now:

    THIS PRESENTATION CONTAINS FORWARD-LOOKING STATEMENTS AND INFORMATION RELATING TO, AMONG OTHER THINGS, THE COMPANY, ITS BUSINESS PLAN AND STRATEGY, AND ITS INDUSTRY. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON THE BELIEFS OF, ASSUMPTIONS MADE BY, AND INFORMATION CURRENTLY AVAILABLE TO THE COMPANY’S MANAGEMENT. WHEN USED IN THIS PRESENTATION THE WORDS “ESTIMATE,” “PROJECT,” “BELIEVE,” “ANTICIPATE,” “INTEND,” “EXPECT” AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS, WHICH CONSTITUTE FORWARD LOOKING STATEMENTS.

    THESE STATEMENTS REFLECT MANAGEMENT’S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND ARE SUBJECT TO RISKS AND UNCERTAINTIES THAT COULD CAUSE THE COMPANY’S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN THE FORWARD-LOOKING STATEMENTS. INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE ON WHICH THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE ANY OBLIGATION TO REVISE OR UPDATE THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES AFTER SUCH DATE OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS.


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