MARK…All It Takes Is A Little Digging

Tailwinds’ Guest Post…this is the second blog piece submitted by a current MARK shareholder who would like to remain anonymous. This author has extensive experience in software and has developed a very deep understanding of Remark and their technology.

All it takes is a little digging …..

As stated prior I more excited about my investment in Remark Holdings (MARK) than any other investment in my 35 plus year career. The reason is simply because of Remark’s Kankan Artificial Intelligence Data Platform. 

Kankan has more data than any other AI product or platform (more than 1.3Bn active unique profiles, 130Bn comments & reviews, 22Bn posts and 6 Bn Videos & images).  Furthermore Kankan can have up to 11,000 data points per profile. 

And two more real cool elements are (1) that despite all this massive data Kankan only requires a little data for its Machine Learning and (2) Kankan Products can be developed quickly. Like real quick. Like in weeks. Kankan became available after years of investment in 2017 and there are already 15 unique Kankan Products serving distinct and unique verticals with big Total Addressable Markets (TAMs). By the end of 2018 there will be at least an additional 15 unique Kankan Products – making a total of 30 or more.

So on December 4 & 5 the CFO sold some stock. Those that have been betting against the company – they were doing so when the stock was $2 and $3 (oh dear) – have been caught in a trap.  Naturally they will do everything they can to try to claw back some losses at least. I think more are realizing that Kankan, with its $30M minimum revenue guidance for 2018 (focus on “minimum” folks) being in the hot category of Artificial Intelligence there is a short runaway, at least in my opinion, before the company reaches $1Bn market valuation. Only takes a handful of more big deals, or bigger deployments of existing big deals, and we get to a revenue run rate of say $50 to $70M of Kankan revenue.

In a hot category (AI – check), with a great product (Kankan – check), a product that can scale to 30 vertical Products by then end of 2018 (Kankan – check), valuation multiples of revenue growth may reach the heights of 20x, 30x or more. When Remark Holdings’ market cap hits $1Bn several bigger funds will be eligible to invest. The thirst for funds, family offices and retail to invest in real AI for real AI horizontal offerings in China and globally is without limit. The road from $1Bn to higher will therefore be shorter still. 

Big words I know. But this is AI. And Kankan is the only horizontal AI offering of substance, that can scale, with incredible volumes of data and quick Vertical Product production I can find.   

The CFO sold a total of 107,142 shares on December 4 & 5. Of these he already owned 44,000 (a mix of 40,000 restricted and 4,000 common shares purchased in the market). Of the remainder the CFO exercised and sold 63,142 options – less than 9% of his options.   Some that are too lazy to understand a Form4 and its surrounding context, or are happy to misrepresent, claim the CFO has only 4,000 options/shares remaining.    

All it takes is a little digging, a little work……

The S8 of May 2017 indicates 615,000 options for the CFO.  The Form4 of June 23, 2017 indicates a further 180,000 options for the CFO. Don’t forget the 4,000 he owned in the open market.

Do I have to do the math for you to show the CFO now owns 691,858 options after his sale of 107,142 shares on Dec 4 & 5 ?

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14 COMMENTS

  1. The only AI? Veritone{veri} . OK the cfo still has options but why why why would anyone unload 107142 shares ???? would you?
    i would not sell a single share. You also did not address cash burn

    • I have forwarded your comment to the guest author of the post and asked him to reply. But, below are my thoughts on your comments.

      I believe the comment was “the only horizontal AI offering of substance, that can scale, with incredible volumes of data and quick Vertical Product production I can find.” Not the only AI company out there in the public markets. I agree that VERI is in the space, but don’t think they are nearly as capable a platform. I believe that GSUM is a stronger competitor than VERI.

      Personally, I would not have unloaded a single share, so agree with you there.

      The cash burn will take care of itself in short order. I expect them to be solidly cash flow positive by year end 2018.

    • Not sure what they would have posted. That conference was a big deal. CEO of Apple. CEO of Google. CEO of Remark. Only three US speakers. Not bad company.

        • CJ, here’s a comment from the article’s author…

          1. VERI has inferior IP to Kankan. In fact VERI has little IP
          2. VERI is a subset of Kankan (at best tbh)
          3. VERI at its recent height reached a valuation of 74 x revenues (2017 rev estimated 13.2Mn by Bloomberg)
          4. Kankan 2018 revenues will be minimum $45M IMO.
          5. Even at the stated 30M, 74x30M = $2Bn plus mkt cap
          6. So let’s try 74x$45M = $3.33Bn
          7. 74 x $60M = $4.44Bn

          8. 74x for sure is high, but if people challenge me with VERI then given Kankan is far superior, more data, more verticals etc it is reasonable to use VERI’s highest multiple

          9. Dan they key is to get to $1Bn valuation – circa $30. When that happens many bigger funds will come piling in (they need min 1 Bn mkt cap for investment criteria)

          and when that happens there may be a gold rush to $3Bn to $5Bn as Kankan is AI, the only horizontal AI platform for 20+ verticals, with the most amount of data, available today – as far as I can see. As stated in my blog the desire to invest in AI is insatiable and w/o limit

          $5Bn is a stock price of well north of $150

          Crazy right?

          AI is as crazy as Crypto. Investors need to find real dedicated AI offerings with unlimited solutions today. Kankan is the lead by far …. when it gets t $1Bn hold on for the ride man …

    • of course I neglected to mention facial & image recognition and Augmented Reality as additional solutions used already by customers and partners.

      Cj you get the point I am laying out – yes?

  2. I stated Kankan was the only HORIZONTAL AI offering. As in the only Horizontal AI offering that has solutions ready for a ton of verticals with many more to come. E,g, already have food safety, traffic control monitoring, live stream filtering, several fintech solutions in Social credit, anti-counterfeiting, Data services, security offerings and more plus another 15 Kankan Products to come from now until end of 2018 addressing who knows what other verticals (I suspect healthcare is one) etc. Please pay attention to the written word. I am not being a wise guy but time too precious

  3. re Chinese conference. It was a Chinese govt conference. No live web casts, feeds or transcripts accordingly. Only 3 US companies presented. Apple, Google and Remark Holdings. IMO that is meaningful

    • I think something happens in the first half of 2018. Most likely it’s an IPO filing by them. Valuation is around $3B, last I heard.

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