Author: Yazan Al Homsi
Overview:
Moseda Technologies (MSD.V) is a 12.7M CAD microCap company focused on secure mobile healthcare and homecare.
IPO and Turnaround
The Company went public as an RTO earlier this year at 20 cents (valuation of c.8.4M Canadian) and did not fair well. At that point, the company started with a focus on logistics and as the market was not as large and market penetration was slow, interest in the stock started to fade away, resulting in a share price as low as 8 cents.
The company shifted its attention and focused on the Healthcare Industry. Since then, the SP hit a recent high of 36 cents and MSD has been achieving revenue generating milestones at a very fast pace.
In my opinion, Moseda’s current management has demonstrated great business intelligence and agility in this switch of focus. While Moseda is currently very much focused on the healthcare industry, this does not diminish any of the milestones reached in the Logistics industry. In fact, Moseda continues to maximize the value of such assets through the pursuit of potential partnerships and/or acquisitions.
Business
In short, the company is in the business of Mobile Device Management and Browser Security. Essentially, Moseda has created a mobile device tracking platform with state of the art security features attached. While the technology can be used in many industries, Moseda supports applications in the oil & gas, Logistics, and Healthcare industries.
Competition
Whilst it's tough to pin down direct competitors to Moseda, the closest competition is Patient Home Monitoring (PHM.V). However, Moseda is more of a complimentary to what Patient Home Monitoring does. Essentially, MSD would perfectly compliment a company like PHM with their technology.
Balance Sheet
Company has close to 1.3M CAD in cash aside from proceeds from the 2 recent purchase orders (350k + 250k). Last raise was done a few months back at 20 cents.
Monthly burn rate is between 60 and 70 thousand CAD dollars. The Company has a run rate to cash burn profitability in Q1 2017. No need to go back to the market to raise funds any time soon, unless the company finds an attractive acquisition that would have a positive impact on revenues and the share price.
Share Structure
Current float is 52M shares, with 9M locked in a placement split into 2 tranches that comes free late January and early February. The CEO and his family own close to 20% of the float and our network including us own close to 40% of the float.
There are 7.5M warrants that are at 35 cents and are open for another 14 months.
Following, I will focus on the Healthcare industry applications or ‘Smart Health Solutions’.
Main Line of Business: Smart Health Solutions
Anyone that has recently visited a hospital in Canada knows that there is a clear mandate to eliminate all paper records and to make the move to maintaining all patient records digitally. Additionally, digitizing patient records comes with a need for increased efficiency and automation of many tasks performed in the healthcare industry.
The company is essentially taking the old healthcare model of managing tasks manually and recording patient's data (tests, vital signs, etc.) using pen and paper to a an automated model that allows data to be placed on a mobile device in a secure manner through data encryption. The data is stored on the cloud and is only accessed by authorized personal. This in turn allows hospitals or other patient care facilities to reduce hours spent by healthcare practitioners performing their daily tasks, leading to increased staff productivity and significant cost savings. The model will be expanded further over the next few months to key segments such as home care patients.
In summary, amongst many other applications, Moseda’s software does the following:
A) improves the efficiency of healthcare professionals by managing their tasks and providing them with necessary reminders and alerts,
B) communicates directly with wireless medical devises with no manual intervention (thus eliminating potential human error in reading the information or manually transferring the readings from paper), and
c) maintains all this data on the cloud in a secure manner.
To read more, please check the Company's link below: https://moseda.com/smartcare
Applications of Moseda’s software in the Healthcare industry (Three different segments I , II , III )
Mobile Application
Digital Health Records
Task Management
Connected Wearables
Revenue Drivers:
1. Monthly Subscription / $5 - $15 per month per patient
Standard SmartCare software license to manage patient health performance in long-term and home care environments
2. Video Consultation / 10% of consultation fee*
Custom SmartCare video platform to facilitate remote doctor - patient consultations?
* average 20 minute doctor consultation fee = $50
3. Hardware / 10% profit margin**
SmartCare - approved hardware included: smartphones, tablets, blood pressure monitor, weight scale, wristband, oximeter, among others
** prices range between $50 - $600 CAD
4. Other (see below) / Blue Sky potential
While device sales will generate the largest initial revenue, the monthly subscription will provide recurring cash flows on a medium and long-term basis.
Another revenue stream that will be very valuable when Moseda hits the 20-25k patient mark is the sale of patient statistics and data (aggregated information with no personal information attached) to interested parties such as insurance companies, pharmaceuticals, and HMOs. Essentially, think of any insurance Company in the world, they all need such data to do their actuarial analysis to determine insurance premiums. This type of information is very valuable to many companies and has no cost attached (100% profit margin). This in my opinion is where the blue sky is.
Why Invest Now
What’s to come?
Q: What will take MSD to new highs?
Macro: The baby boomers market is growing; 10,000 people turn 65 every day in the US; moving to an assisted living facility is an absolute last resort for most people; they want to remain independent; doctors/nurses/practioners are economically incentivised by payors to utilize technology in the delivery of care.
Micro: MSD has very strong relationships with its’ current customers and is talks with many potential new customers – they are industry leaders (with security as main differentiator) and carry a strong degree of clout that will open up doors for additional revenue generation. A ramp up of revenue is underway and I expect that a large portion of it to be recurring revenue. Moseda is being approached on a weekly basis by organizations such as long term care homes that want to adopt or pilot their technology.
My interview with the CEO can be viewed here
Author Disclosure: "We are the business development team helping
____________________________________________________________
Guest Reports: Members, have a report your interested in sharing, message us now as we are interested in sharing your work with our MicroCap community.
Premium Content: Make sure to check out SecretCaps' 17 Page Research Report on our latest Conviction Play.
SecretCaps' Disclosure: This article was written by SecretCaps Member, Yazan Al Homsi. SecretCaps does not recommend or back the article as it is an independent article being shared for our members' education. This content is strictly informational and educational, do not trade or invest based upon the above information. Further, this is guest content and is not the work of, or recommendation of, SecretCaps.