Archive for November, 2010

Shop ALOT on Cyber Monday – Its Time!

Cyber Monday is upon us.  Now is the time to use your ALOT toolbar/appbar and/or Home Page search box to search/shop everything you will be buying for Christmas and for your year end financial house cleaning. Shop everything you will be buying between now and Christmas and shop everything you need to get your financial house in order prior to year end (auto, home & life insurance quotes, tax help, best credit card deals, consolidation loans, refinance mortgage rates, home equity lines of credit, etc.) and remind everyone you have told about our viral campaign to Shop ALOT today.  If you are at work and unable to download the appbar/toolbar due to network restrictions, you can still search/shop ALOT using the ALOT home page.  Just type in the URL –

http://home.alot.com

How does one “shop their purchases” using ALOT? Step one in shopping your purchases is using the regular search box, the one you use to search the internet which is on the left side of the toolbar/appbar or in the upper center of the home page. This search box is where you will enter the name of the product you intend to buy and execute a search. For instance, if you are looking to buy a “laptop computer” or “online gift cards” then you would simply type that into the search box and click the search button. The Google powered search will generate a list of sponsored links and web page results. The sponsored links at the top are essentially the companies/services that are willing to pay the most to show you their best deal they offer for what you searched for. They are not ranked in any kind of order that would let you know who has the best deal though, so you will want to try each site to see who offers the best prices and/or overall best terms (sometimes the lowest price will have additional handling/shipping terms that make it not the best deal). Regardless which one you decide to purchase from, Vertro earns revenue when you click to visit each site. In the laptop computer example, recent bids to offer the top ranked link were over $6.00, so Vertro could actually make close to $5.00 (via revenue share with Google) when you click that link to visit the laptop merchant’s site and Vertro earns revenue for each of the other sponsored links that you visit too. Thus, if you shop it thoroughly and check the prices/terms at six or seven of the top ranked sites, Vertro could earn $15 – $20 regardless which merchant you ultimately buy it from. This works the same way for any other product you may have on your Christmas list.

Step two in shopping your purchases is simply to take the best deal you found using the search box and then shop it using the ALOT “shopping” tab that can be found on the Alot Home Page just above the search box between the “news” and “videos” search feature. When you enter an item in the box and click the “shopping” tab, it will search that item and bring back the most relevant results from Amazon, Ebay and Shopping.com in a three column format that allows for easy comparisons. This will allow you to see if any of the three top online merchants can beat the deals offered through the main search function described above. If one of the deals found here beats the other prices and you actually purchase it, Vertro makes a percentage (typically 4-10%) of each sale.

One of the most interesting things we discovered when researching the Cyber Monday Shop ALOT promotion was that Vertro usually made significantly more revenue from just the searching that is done in step one. While it is still a good thing and revenue producer to buy something through the Alot shopping tab, the company actually makes more money when you use the regular search feature because they get paid for each site you visit regardless which one you choose to buy from and the amounts the individual merchants pay to have you visit their site is often more (in the aggregate) than the percentage that Vertro makes when you make a purchase through the shopping link. Thus, the company and the consumer are best served when you use both (search thoroughly) and then just buy from whomever offers the best deal.

In summary, it is time to go shopping.  Make it count today, search/shop everything you will be buying between now and Christmas and search/shop everything you need to get your financial house in order prior to year end (auto, home & life insurance quotes, tax help, best credit card deals, consolidation loans, refinance mortgage rates, home equity lines of credit, etc.)  Congratulations to all community participants who have bought VTRO and continue to tell friends, family and associates about this collaborative consumption opportunity.  Your efforts are bearing fruit, as evidenced by the ever increasing stock price and metrics that improve month after month and quarter after quarter.  Lets see if we can blow away the record for daily revenue set last year on Cyber Monday!

Buy VTRO / Use the Google Powered Appbar / Bring 2 Friends

http://www.alot.com

November 29, 2010 at 5:25 am Leave a comment

Cyber Monday Update – Only 5 Days Left!

With only five more days until Cyber Monday, we wanted to update and congratulate the Groove VC community on a well done campaign.  Groove members have obviously done a great job of getting the word out to friends and associates about our “Buy ALOT on Cyber Monday” campaign. If success at this point can be measured by traffic to the Groove site and Blog pages, then our campaign is already a raging success with record traffic that will easily exceed our traffic TOTALS for the prior six months.  We fully expect to see follow through to Cyber Monday, where we should see Vertro’s ALOT achieve a new one day revenue record, handily eclipsing last year’s $106,000 one day revenue record.  Just in case any of the new participants joining us this week did not get a chance to read the “how to shop ALOT on Cyber Monday” post from last week, we are going to put it on its own page on the Groove website to make it easier for Groovers to just forward a URL to new participants instead of trying to link to the blog entry itself.  Here is the link:

http://www.groovevc.com/ShopALOTCyberMonday.html

Keep searching and shopping ALOT and tell as many friends and associates about it as possible before Cyber Monday!

Buy VTRO / Use the Google powered Appbar / Bring 2 Friends

http://www.alot.com

November 24, 2010 at 1:30 pm Leave a comment

Shop ALOT on Cyber Monday

Cyber Monday is the Monday immediately following Black Friday and generally considered to be the ceremonial kick-off of the holiday online shopping season in the United States. It is the online shopping equivalent of Black Friday, the biggest shopping day of the year for offline retailers

In 2009, Vertro achieved its largest revenue earning day in its short history on Cyber Monday, booking just over $106,000 in revenue. We believe that the GrooveVC community could have a significant impact on Vertro’s Cyber Monday results this year if all community participants commit to shopping all of their Christmas purchases online through ALOT’s appbar/toolbar or home page. We have asked each participant to commit to using the approach described below and to invite two friends to join us in this campaign as consumers and investors. Of course, as new participants, these two friends should also go through the first steps we recommend for all who join the Groove, whereby they use the ALOT search features to shop all of their consumer financial services to make sure they are getting the best deal on their credit cards, auto insurance rates, term life insurance rates, homeowners insurance rates, mortgage or home equity line of credit rates, etc. This will make them better informed consumers, free up more capital for them to invest in Vertro stock and cause them to have a few more dollars to spend shopping ALOT on Cyber Monday.

How does one “shop their purchases” using ALOT? Step one in shopping your purchases is using the regular search box, the one you use to search the internet which is on the left side of the toolbar/appbar or in the upper center of the home page. This search box is where you will enter the name of the product you intend to buy and execute a search. For instance, if you are looking to buy a “laptop computer” or “online gift cards” then you would simply type that into the search box and click the search button. The Google powered search will generate a list of sponsored links and web page results. The sponsored links at the top are essentially the companies/services that are willing to pay the most to show you their best deal they offer for what you searched for. They are not ranked in any kind of order that would let you know who has the best deal though, so you will want to try each site to see who offers the best prices and/or overall best terms (sometimes the lowest price will have additional handling/shipping terms that make it not the best deal). Regardless which one you decide to purchase from, Vertro earns revenue when you click to visit each site. In the laptop computer example, recent bids to offer the top ranked link were over $6.00, so Vertro could actually make close to $5.00 (via revenue share with Google) when you click that link to visit the laptop merchant’s site and Vertro earns revenue for each of the other sponsored links that you visit too. Thus, if you shop it thoroughly and check the prices/terms at six or seven of the top ranked sites, Vertro could earn $15 – $20 regardless which merchant you ultimately buy it from. This works the same way for any other product you may have on your Christmas list.

Step two in shopping your purchases is simply to take the best deal you found using the search box and then shop it using the ALOT “shopping” tab that can be found on the Alot Home Page just above the search box between the “news” and “videos” search feature. When you enter an item in the box and click the “shopping” tab, it will search that item and bring back the most relevant results from Amazon, Ebay and Shopping.com in a three column format that allows for easy comparisons. This will allow you to see if any of the three top online merchants can beat the deals offered through the main search function described above. If one of the deals found here beats the other prices and you actually purchase it, Vertro makes a percentage (typically 4-10%) of each sale.

One of the most interesting things we discovered when researching the Cyber Monday Shop ALOT promotion was that Vertro usually made significantly more revenue from just the searching that is done in step one. While it is still a good thing and revenue producer to buy something through the Alot shopping tab, the company actually makes more money when you use the regular search feature because they get paid for each site you visit regardless which one you choose to buy from and the amounts the individual merchants pay to have you visit their site is often more (in the aggregate) than the percentage that Vertro makes when you make a purchase through the shopping link. Thus, the company and the consumer are best served when you use both (search thoroughly) and then just buy from whomever offers the best deal.

In summary, now is the time to bring new friends and associates into the fold.  Teach them to shop using ALOT and get ready to shop everything on your Christmas list through your ALOT toolbar/appbar or Home Page on Cyber Monday, November 29.  Congratulations to all community participants who have bought VTRO and continued to tell friends, family and associates about this collaborative consumption opportunity.  Your efforts are bearing fruit, as evidenced by the ever increasing stock price and metrics that improve month after month and quarter after quarter.   Keep up the good work!  The countdown to Cyber Monday starts today – only 10 days left!

Buy VTRO / Use the Google Powered Appbar / Bring 2 Friends

http://www.alot.com

November 19, 2010 at 2:26 pm Leave a comment

Atrinsic Q3 Update

Atrinsic reported Q3 earnings this week with few surprises.  The company was able to reduce the cash burn in Q3 and presented a restructuring plan that will be undertaken when the merger with Kazaa is complete.  When we first introduced Atrinsic as a focus stock for the GrooveVC community, we indicated that we expected the company to burn cash for a few more quarters before they would be able to turn the corner to profitability.  We continue to believe that will be the case, but feel the company’s loss of $3.6 million in Q3 represents the majority of that cash burn. The cost reduction measures already in place should significantly reduce the cash burn for Q4 2010 and make the loss in Q1 2011 nominal.  ATRN management’s announced restructuring initiative should reduce their fixed operating costs 30 – 50% from Q3 levels and we believe most of these measures will be in place by the end of Q4. Atrinsic has recieved $2.7 million of the $3.5M IRS receivable that was on the balance sheet at the end of Sept. 30 putting the company’s current cash position north of $6 million.

ATRN management believes the company will be able to achieve a 30 – 50% reduction in fixed operating costs (reduction of $2-$3 million from Q3 levels) with a post Kazaa closing restructuring plan that involves consolidating offices currently located in Los Angeles, Canada and Australia into the company’s home office in New York City and reducing headcount to around 60 from 144 at the start of 2010.  We were pleased to see the company’s aggressive cost reduction efforts and believe that the actions taken in Q4 will allow management to refocus its efforts on profitably growing the business. We were particularly pleased with management’s stated focus of getting a mobile offering in place for Kazaa by the end of the fourth quarter and a goal of offering Apps for the four major mobile smart phone platforms (RIMM, Apple, Android and Windows) in q1 2011, along with more competitive pricing and access plans. We believe this is key, as many of the players in this space have offered significantly lower price points than Kazaa for much of 2010 and some of them already include mobile options.

We continue to believe that online and mobile streaming music will be one of the big technology stories of 2011 as Google, Apple, MSFT, HP and others bring the streaming music concept and value proposition to the mainstream, doing much of the heavy lifting as far as marketing the concept. An NPD survey released this week indicated that downloaded music now accounts for 30 percent of music listening, while streaming music jumped to 29 percent from only 25 percent a few months earlier, indicating that more and more consumers are turning to streaming music services and recognize the value proposition vs. downloading. We believe that Kazaa is ideally situated to benefit substantially from this trend.  We believe that the Kazaa brand name, combined with more aggressive promotion, pricing and alternative billing options give Kazaa the potential to be one of the first profitable players in this space. Additionally, the company appears to be two weeks away from approving a reverse stock split that will allow the company to regain compliance with the Nasdaq minimum bid rule, two weeks beyond that from closing the Kazaa deal and likely just a few days beyond that of offering the Kazaa service through most mobile platforms. We note that the company’s current market cap as of yesterday’s close of $9.63 million reduced by the cash in the bank at quarter end leaves a value for the assets (Kazaa, Ringtone.com, GatorArcade, Atrinsic Interactive) of just over $2 million. Whether Kaaza is one of the first to acheive profitability or not,  we believe that there will be many investors who will want a piece of the purest publicly traded play in streaming music and that investors who buy at today’s prices are essentially getting the Kazaa music business for free.

November 18, 2010 at 11:51 am Leave a comment

Time to Double Down on Vertro & Shop ALOT on Cyber Monday

While we firmly believe that investors who buy at today’s prices ($4.50 – $5.00) have a very good chance to double their money over the next six – twelve months (and maybe much sooner), the double down we are referring to is not actually a stock purchase.  Given the extraordinary exposure to new investors Vertro has received over the past five days, we feel that it is time for the GrooveVC community to “pull out all the stops” so to speak.  Vertro is now on the radar screens of hundreds (maybe thousands) of potential new investors who will be watching over the next few weeks and months to see how the company performs.  This could not come at a better time, as we believe that the company will achieve a sequential gain of more than 100% over the RECORD earnings they achieved in Q3.  We believe that Q4 will be the “break out” quarter where Vertro’s significant operating leverage will be showcased for the first time.  As strong as the Q3 results were, management made it very clear early in the quarter that they saw an opportunity to invest heavily in customer acquisition during Q3, which would build up the toolbar / home page user base prior to the key holiday retail season when internet seaching and shopping are usually at a peak.

So the table has been set and now it is time for the Groove VC community to step up to the plate.  Now is the time when we can have a huge impact on  Vertro’s fourth quarter if we all “double down” – get two more people to join our ranks and teach them how to search and shop online using ALOT.  Help each one to see how they could realistically double their money over the next year by investing in Vertro at today’s prices if they will download the appbar or use the home page each time they need to Google something (or shop online) and get two people they know to do the same thing. Our goal is for each existing Groove VC participant to bring in two more people who can bring in two friends of their own between now and Cyber Monday (November 29, 2010) and for all Groove participants to commit to shopping all Christmas purchases using ALOT on Cyber Monday.

How does one “shop their purchases” using ALOT?  Step one in shopping your purchases is using the regular search box, the one you use to search the internet which is on the left side of the toolbar/appbar or in the upper center of the home page.  This search box is where you will enter the name of the product you intend to buy and execute a search.  For instance, if you are looking to buy a “laptop computer” or “online gift cards” then you would simply type that into the search box and click the search button.  The Google powered search will generate a list of sponsored links and web page results.  The sponsored links at the top are essentially the companies/services that are willing to pay the most to show you their best deal for what you searched for.  They are not ranked in any kind of order that would let you know who has the best deal though, so you will want to try each site to see who offers the best prices and/or overall best terms (sometimes the lowest price will have additional handling/shipping terms that make it not the best deal).  Regardless which one you decide to purchase from, Vertro earns revenue when you click to visit each site.  In the laptop computer example, recent bids to offer the top ranked link were over $6.00, so Vertro could actually make close to $5.00 (via revenue share with Google) when you click that link to visit the laptop merchant’s site and Vertro earns revenue for each of the other sponsored links that you visit too.  Thus, if you shop it thoroughly and check the prices/terms at six or seven of the top ranked sites, Vertro could earn $15 – $20 regardless which merchant you ultimately buy it from.  This works the same way for any other product you may have on your Christmas list.

Step two in shopping your purchases is simply to take the best deal you found using the search box and then shop it using the ALOT “shopping” tab that can be found on the Alot Home Page just above the search box between the “news” and “videos” search feature.  When you enter an item in the box and click the “shopping” tab, it will search that item and bring back the most relevant results from Amazon, Ebay and Shopping.com in a three column format that allows for easy comparisons.  This will allow you to see if any of the three top online merchants can beat the deals offered through the main search function described above.  If one of the deals found here beats the other prices and you actually purchase it, Vertro makes a small % of each sale.

One of the most interesting things we discovered when researching the Cyber Monday Shop ALOT promotion was that Vertro usually made significantly more revenue from just the searching that is done in step one.  While it is still a good thing and revenue producer to buy something through the Alot shopping tab, the company does better when you use the regular search feature because they get paid for each site you visit regardless which one you buy from and the amounts each individual merchant pays to have you visit their site is often more than the percentage that Vertro makes when you make a purchase through the shopping link.  Thus, the company and the consumer are best served when you use both (search thoroughly) and then just buy from whomever offers the best deal.

Our viral campaign to get as many new users as possible by Cyber Monday and for all GrooveVC participants to shop all of their Christmas purchases through Alot on Cyber Monday gives us exactly three weeks to prepare to make the biggest impact on Vertro’s fourth quarter results that is possible. The reason we are focusing on Cyber Monday as the culmination of our efforts is twofold:

1) Last year the company had their biggest single revenue earning day in their short history on Cyber Monday and they issued a press release to tell shareholders about it. If we are able to set a new single day revenue record, we believe that the company would issue another press release to let shareholders know about it.  This which gives us more favorable press during this period where many new investors are looking at the Vertro story and allows us to enjoy the closest thing to “instant gratification” we are likely to get for our efforts.

2) The timing of this focused effort helps the Groove to bulk up the number of virally acquired appbar/home page users just in time for the period that is usually the peak for annual web shopping (and very strong for search traffic), the 2 – 3 weeks following Thanksgiving, which gives us an opportunity to make a meaningful impact on the fourth quarter numbers.

Thus, Cyber Monday is where we will make our stand.  Small investors and Vertro shareholders unite! Bring two new ALOT users into the fold before Cyber Monday and more importantly, commit to shop all Christmas and other end of year purchases using ALOT on Cyber Monday to help the company achieve a new record revenue day and bring more investor attention to the Vertro/ALOT story.

Buy VTRO / Download the AppBar / Bring 2 Friends      http://www.alot.com

November 8, 2010 at 1:10 pm Leave a comment

Vertro Results Much Stronger Than Anticipated

After the close yesterday, Vertro reported earnings, revenues and cash that were significantly higher than even the high end of our expected range.  This was easily the strongest quarter reported since GrooveVC named Vertro as our focus stock.  Revenue of $9.8 million was significantly higher than the top end of our expected range of $9.2 – $9.4m and we believe this resulted from several very positive trends that we have discussed in this forum before –

1) ALOT users (on average) are keeping their toolbars longer and interacting with their ALOT toolbar/HomePages (search and other revenue generating transactions) more often

2) Management continues to find new ways to monetize the existing user base, including many new CPA deals and the introduction of CPM based display ads

3) An ever increasing base of virally (zero cost to VTRO) acquired toolbar and Home Page users who use ALOT for all of their searching and online shopping. We believe that several thousand consumer/investors (who are more likely to remember to always use ALOT for searching because they own part of it) will play a continuing role in quarterly reports that seem to have a disconnect with the historical relationship between a quarter’s ad spend and its reported revenue.

Management continues to impress with their ability to grow the company while strictly managing non advertising operating expenses, achieving 15% revenue growth with a quarterly total opex of only $2.2m.  While management’s response to the question about the sustainability of that level suggested that there was a one time benefit related to reduced lease obligations, we remain confident that Vertro will continue to be able to perform at a sub $1 million per month level.  Cash from operations improved to $1.5 million and we were able to add $1.2 million to our cash balance to a total of $7.1 million at September 30. Management had indicated on the Q2 call that they intended to spend heavily on advertising in Q3 to build up their user base in advance of the Q4 holiday season, which is typically the strongest part of the year for web traffic and transactions. While they did increase ad spend to $6.7m, their extremely disciplined management of other operating expenses combined with the breakout in revenue allowed Vertro to book a GAAP profit of 5 cents per share for the quarter.  Our own expectations were for the company to be breakeven or at best to earn something ($50k top end of our estimate) that could be rounded up to 1 cent per share. GAAP earnings of 5 cents per share was not among the potential outcomes that we could forsee and we applaud management for delivering in such grand fashion.

Vertro as currently constituted has existed for a little over a year and during most of that time they have operated well below the radar of Wall Street and most main street investors. That changed this week.  Between the influx of new “investor/consumers” following the Vertro article published by Seeking Alpha on Monday and the eye popping results posted Thursday after the market closed, the days of Vertro operating in obscurity are likely gone. If the number of unsolicited requests for information from hedge funds and accredited investors we have received this week are any indication of the interest the company itself has received, Vertro will soon be well known among small cap investors and fund managers.  Additionally, the spike in traffic that the GrooveVC sites enjoyed on Monday actually increased on Wednesday with the highest day being Thursday, suggesting to us that GrooveVC community members are redoubling their efforts to get the word out.  We believe that the timing could not be better for such a revival, as the volatility in the stock might even allow some new members to buy stock below today’s closing price of $5, which is just 5x our estimates for 2011. We believe that investors at these prices will be able to  double their money over the next 6 – 12 months, as institutions, mutual funds and more retail investors vie for some of the 2.9m shares in the public float.

November 5, 2010 at 3:24 pm Leave a comment

Vertro Q3 Earnings Preview

Vertro releases earnings today after the close. Our estimates are as follows:
Revenue – $9.2m – $9.4m
Non Ad Opex – $2.7 – $2.8m
Advertising –  $6.4m – $6.5m
EBITDA – breakeven – $50k
We are also hoping to get an update on Q4 to date, a high level view of capex in 2011, more color on management’s plans for international markets and an in depth discussion of management’s plans and expectations for the new AppBar.

November 4, 2010 at 10:15 am 1 comment

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