Let’s Have an Adult Conversation About Sponsored Research for 3000+ Uncovered & Invisible Public Companies in 2013-Part 1
Chuck Jaffe, a very reasonable MarketWatch.com columnist with whom I have at least a 10 year working relationship, posted a reasonably negative column this week on our business of sponsored research for uncovered emerging growth companies…specifically Petrosonic (PSON). The gist of his article is his issue with the conflicts of interest with sponsored research…and generally why such a nice guy like me would sully himself in the world of emerging growth stocks and have the audacity to be paid for research by a public company.
So let’s talk about the business and necessity of sponsored research…and why I am VERY comfortable with this research model for the 3000+ public companies listed on the NYSE/Market/ Nasdaq and OTC markets with ZERO buy side or sell side equity analyst research coverage.
#1 For the record, my last contributor agreement with Fox News did NOT include any exclusion from me or my company sponsored research. But that is water under the bridge…I am no longer a Fox contributor. I thank them for a 14 year run…but all good things come to an end.
#2 I of course NEVER EVER mentioned Petrosonic on ANY appearance on Fox News or Fox Business News…strict policy against talking about <$500M companies.
#3 The direct mailer discussed in the article is an advertisement for our new paid newsletter Next Big Thing Investor PRO which features Petrosonic as the next big thing in heavy oil refining technology. Syndicating the cost of a $million direct mailer with investors in PSON is a business decision for NBT Group, Inc.…my publishing company.
#4 Our fee for sponsored research covers one year of equity research and updates…due diligence costs time and money. It also included list rentals and other awareness raising strategies.
But the bigger issue on the table for emerging growth companies and the public capital markets is: WHERE do promising emerging growth companies GO when they don’t have a “VC” fundable company…which is about 98% of emerging growth companies?
Research in ANY model is a COST center that must be funded by transactions, commissions or sponsored coverage. The facts are that capital formation in the emerging growth space has cratered since 2001.
To wit:
The Death of small IPO’s in America since April 2012 –less than $3 billion raised for just 53 small companies vs. $19 billion in 1997
3000+ NYSE/Market/ NASDAQ and OTC listed companies ORPHANED by zero Wall Street research due to the 70% reduction of analysts and research on under $1 billion companies post 2000 and 2008 market crashes from sell-side investment banks
Virtually ZERO IPO’s for less than $50 million in the last 12 months – See Here
NBT Equities Research LLC was started to help DESERVING emerging growth companies find an investor audience…and we are proud of the work we have done on behalf of our portfolio companies.
HOW does an emerging growth company with ZERO hope for Wall Street analyst coverage get their story out to retail investors, let alone institutional investors?
We’ll get to that story NEXT week…
GlyEco Enters the Blogosphere |
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GlyEco, Inc., the leader in waste Glycol recycling, has published their first blog post today. This is an interesting read that really puts their work into perspective. The title of the post, “How Much Is 700 Million Gallons?”, shows just how many polluted glycols we create just in the States every year. |
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Cabana Lemonade Sales up 1251% Year Over Year |
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Since we first started coverage of soon to be beverage giant Pulse Beverage (PLSB), they have been rising faster than anyone could expect. It's amazing they have gone up 306% in the year 2012 alone. |
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Petrosonic Energy Is Generating New Revenue |
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Petrosonic Energy has recently announced they are now generating revenue due to the completion of their emulsification processing plant in Albania. |
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Update on Brazil Minerals (BMIX) |
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Brazil Minerals gives an update to their operations for the past two months with a favorable outlook. |
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Nature’s Best + Pulse Beverage = Perfect Partnership |
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Pulse Beverage pulls out all the stops for summer and adds two more distribution networks that spans from the US to parts of Asia.. |
Max Sound Corp. (MAXD): Bringing Perfect Audio To Qualcomm |
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Max Sound Corp. (MAXD): Bringing Perfect Audio To Qualcomm Tobin Smith of NBT Equities Research interviews John Blaisure of Max Sound Corp. (MAXD) |
GlyEco, Inc. (GLYE) |
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GlyEco, Inc. is a green chemistry company which transforms used glycols, a hazardous waste, into profitable green products. The Company’s patent-pending technology recycles polluted glycols to a purity level equal to refinery produced material. This unique process cleans all five types of polluted glycols: HVAC, Textiles, Automotive, Airline and Medical. World-wide consumption for refinery produced ethylene glycol is over 5 Billion gallons per year. |
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Founder and Editor-in-Chief for NBTEquitiesResearch.com. Contributor and Anchor for the Fox News Channel and Fox Business Network 2000-2013. Chairman & CEO of NBT Group, Inc., a boutique private capital investment bank and investor relations organization.