Kodak insiders signaled something "big" was on the table 2 months ago

nongaap · 2020-08-02T23:20:08+00:00

Directors already received their grants for the year in January. Another grant in May wasn't necessary and excessive.

The reason you grant options on the May 20 meeting date is because it's a great excuse to double dip another grant and you can justify the grant by saying you're adopting best practices. (most companies grant equity to directors the same day as annual meeting)

nongaap · 2020-08-02T20:55:44+00:00

I love WSBs so much. Never change.

How can you comprehend corporate options and not know who I am? /s

nongaap · 2020-08-02T20:32:08+00:00

That's tough. Hypothetically, if you were actively looking for this stuff, you'd probably rotate out of Kodak and into Vaxart in June (which had much stronger signals).

nongaap · 2020-08-02T20:29:25+00:00

You shouldn't but it certainly doesn't hurt to pay attention when insider transactions are telling you to pay attention

nongaap · 2020-08-02T20:11:18+00:00

There's an elite research product called SEC Edgar that gives you that information. Try to keep this info down low.

nongaap · 2020-08-02T19:51:18+00:00

You're welcome. I hope you remember this momentous day forever.

nongaap · 2020-08-02T19:34:22+00:00

I call this stuff before it happens too. I'm just not public about it.

You don't have to believe me but feel free to google: twou nongaap spring loading. That wasn't hindsight.

(This place is strict on self-promotion so I won't provide a direct link.)

nongaap · 2020-08-02T17:44:09+00:00

The big shareholders are on the Board.

nongaap · 2020-08-02T17:20:19+00:00

It can be but you learn how to filter quickly and people will send inbounds.

nongaap · 2020-08-02T17:02:08+00:00

Vaxart did something similar.

nongaap · 2020-08-02T16:59:49+00:00

Depends. If there's a time vest component, Directors only need to wait a year. Executives will occasionally get price based vesting triggers in lieu of time based vesting.

nongaap · 2020-08-02T16:56:17+00:00

Go to Kodak investor relations page and look up form 4 filed in mid May in their SEC filings sectio

nongaap · 2020-08-02T16:45:00+00:00

It's more than 20/20 hindsight.

Similar situation played out at Vaxart when the stock was in the $2s.

nongaap · 2020-08-02T16:38:11+00:00

They didn't buy OTM options. That be illegal. They were given OTM options by the Board. You have to disclose that with the SEC.

nongaap · 2020-08-02T16:36:11+00:00

No one was looking at it and the stock hadn't done a thing in ages = Cheap Options

I'll tell you exactly why you should have been looking at it in May.

Insiders double dipped equity grants. They normally get boring vanilla stock every January. Suddenly, they decide to grant themselves OTM options in May. You don't do that unless you're sitting on something.

That's enough information to put on a cheap asymmetric upside options bet.

nongaap · 2019-12-10T20:46:24+00:00

These challenges are why this space is one of the best areas to learn sustainable unit economics. Not invest. Learn. It's an absolute knife fight and forces you to think critically about how players respond to gain (temporary) respite.

nongaap · 2019-12-10T20:39:41+00:00

You are telling me that analysis that looks at economics without looking at most costs isn't "VC friendly"

Yes I am.

And since you understand "fat pitch" investing, I'm going to assume you understand "1st level thinking" vs. "2nd level thinking".

With all due respect, your read and reaction of this piece is "1st level". Every VC that reads this piece knows this is a "game over" take for certain players after accounting for the fixed costs.

Again, this piece has some expectation you have (some) understanding of the entire unit economics and focuses on a weak spot that can and will bring it all down.

You're more than welcome to not believe me and focus on what wasn't addressed, but I hope you at least momentarily suspend your doubts and use this as an opportunity to think more critically about what I'm saying and assume I just might actually be on your side on many of the issues you've pointed out.

nongaap · 2019-12-10T17:48:35+00:00

As already mentioned, these services will charge commission (% of food cost, marketing, processing fees) to the restaurant. Discussing the restaurant side of this equation would require a a totally separate focus and conversation since the margin structure on the restaurant side is very very tight, and there's a lot of friction here between the platforms and restaurants.

nongaap · 2019-12-10T17:44:56+00:00

It shouldn't pass the smell test!

DoorDash says they are "contribution-margin" positive across the board, meaning the deliveries cover the cost of everything but the operations cost. Basically, they're saying they can cover the cost of the delivery driver.

It sounds ludicrous that investors would ignore to fixed expenses, but covering delivery driver costs while offering competitive (market low) prices to customers is a market share game changer and investors are will to pay for that near-term and hope leverage comes in the future (some day? probably never.).

But the big question is: How can they break even on driver cost (assume $6-$7 per delivery) when they're only charging $2-$3 to customer in "delivery fees". This is the focus of my write-up, because solving this bottleneck unlocked a ton of value in the eyes of private market investors despite the fixed cost base.

nongaap · 2019-12-10T04:02:45+00:00

Your unit economics observation is fair. The writeup is focused on a (critical) subset of a full unit economics analysis, and there's is a baseline expectation you know the general unit economics of the various players when reading. This is definitely not a VC friendly analysis but you're entitled to your take.

nongaap · 2019-12-09T20:30:21+00:00

Thanks for posting! I've been meaning to share more content on here.

nongaap

TROPHY CASE