On behalf of the entire Steering Committee, Greg and I hop[e you had an enjoyable holiday season and wish you the very best for the coming year.  This will be our final activity report for 2020. We trust it finds you all healthy and doing well.

The IC has enjoyed the opportunity to evaluate many new investments and continues to identify and fund the ones we believe hold the most promise. In fact, we have invested more in the last 6 months than we did in the prior three years, and we intend to continue.

Here are some updates and highlights of our recent activity:

• DAVI was our final investment in 2020.  This company will market very high end audio headphone equipment. IC invested $25,000 for the group while three members added additional funds to bring the total investment in the company to $50,000. 

• TSU looks very promising with a recently announced valuation of $100 million.  This new social media platform with a unique revenue sharing model is showing signs of phenomenal growth reaching extraordinary subscription levels in record time.

• We committed $50,000 to the initial round of QSM. This innovative group has invented an instrument which can detect a very specific and common ear infection in dogs.  With a vast market, manufacturing and distribution in place, and the longer term potential to take this technology to the human market, we expect a very good return from this investment.

• Netcapital was acquired last fall by a microcap public company named ValueSetters, Inc., which subsequently changed its name to Netcapital, Inc.  As a result, IC has its first publicly traded company (trading symbol NCPL)!   Our investment is still held as a convertible note which , under the terms of its merger with ValueSetters, will convert once their market cap exceeds $11.5 million for 15 straight days.  We are not there yet, as the market cap is approximately $5 million.

• Early this month David Safaii provided a rather upbeat report on Trillio. They are building staff and revenue, while expanding into new markets. They are moving to new quarters, and closed on a $12M Series B as well as $3.5M in debt financing. Though facing COVID headwinds, their prospects are good for growth in 2021.

• GreenSight recovered well in 2020 after overcoming a cash crunch early in the year.  Revenues were approx. $4M, and the company generated a slight profit for the year.  Government contracts represent roughly 50% of the business, and the company’s existing contracts support growth to $6M+ in 2021.  The golf business is growing but does not appear to be a big enough opportunity to build a major business.  GreenSight’s key issue is to figure out how to leverage the government contracts into a major commercial business.

• In case you are trying to track these, a few of our holdings now go by other names:

• Skulpt became Myolex
• Courtagen became Medicinal Genomics
• Antera became Adeo  (but dissolved in 2019)
• eCurve became Demand Q

• As reported last time, holdings such as Allwork, Drink More Good and Labcloud continue to suffer under the current economic conditions. Not much further to report.

• Finally, 7AC, an NAIC 1 investment reported they are entering into a merger resulting in a buyout. Proceeds, if any,  will be distributed to the participating members as soon as it is received.

We always welcome thoughts and input from our members, both past and present. Of course, we are also interested in attracting new members who can contribute to our intellectual and financial asset base. If you know anyone who may be of interest send them our way. Moreover, we are offering former members who withdrew or have run out of available capital an option to buy back in and regain your standing for $15,000.  This “topping off” will be the way forward for us as a group to continue and to grow in 2021 and beyond. It is an approach to allow new, exiting and former members to have sufficient funds to continue participation in the new year.

Recently, we identified a new, very high potential company in the health care space which is looking for capital to fuel marketing efforts.  They have a finished product, patents to protect it, manufacturing capacity and distribution channels already lined up.  Their product is highly  likely to be successful on its own, but we anticipate the company will be acquired quickly resulting in an even greater return.  Their product is an appliance that continuously disinfects large, open spaces using charged ion particles making it very attractive to certain markets such as restaurants. Demand will be high particularly during these COVID times but even beyond. It is attractive enough that at least two members are putting extra capital into the deal.  None of our current or former members should miss out so if your capital is insufficient or you withdrew, we strongly urge you consider the option to get back in the game.

As an investment group our three key goals remain:

1. Manage the current portfolio to maximize return to our members who are invested with us,
2. Identify new investment opportunities to increase the portfolio value and add more potential return,
3. Grow the membership to broaden participation and increase our investment power.

If you have any questions please feel free to reach out to me or Greg, or any member of the Steering Committee on copy here.  

Sincerely,

Joseph A. Puglisi

Chairman & Co-Manager

NAIC 2

(914) 623-8508

WWW.NAIC2.com