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Small Cap Investing
Recorded: March 2, 2026 Duration: 1:00:09Space Recording
Full Transcription
Thank you. hello everybody how is it going my name is Taj, hanging out here with the Wolf crew
and the Small Cap Trading crew. So we have a great lineup as usual and always happy to hang
out with the Story Trading crew. And we have a few different speakers here today, but really
happy to get into this one. Lots of craziness is happening in the world. Of course, everything impacts markets and what have you. So not to dwell on all the negative, but we have to speak about the reality of everything. Of course, you know, these things do affect the way money flows. And we're going to dive into some small cap investing. Look at what's on the radar of everyone. And of course, afterwards, we can go into some specifics if there's any stocks specifically,
not just themes, but if there is a ticker that you want people to check out.
But I'll pass it over to Rhett of the Story Trading crew.
How's it going on your side before we pass it around to the speakers?
Awesome. All is well on our side.
Yeah. Can we just go ahead and make me co-host really quick so I can bring up Crispy as well?
I see him as a listener in the audience.
I don't know what happened there.
I think I lost my co-host spot there.
Yep, no problems sent again.
So, yeah, Crispy fell down too as well.
A little technical difficulties as usual.
But you know what?
We just roll with the punches, and hopefully everything is going good. Is he back up? Because I'm not seeing him on my side.
No, I'm not seeing him on my side either. While he tries to get up there,
I will go ahead and, do you want me to kick off the macro for us really quick? Yeah, absolutely.
I appreciate that. Awesome. Yeah, of course. Sounds good. So, I mean, as you guys saw,
there was a lot of headwinds, especially with the
war that we saw over the weekend.
And for our macro discussion, there was a few things that we had mentioned today.
We went we went long the queues this morning and I'll get into that here right now.
So as you guys know, our founder, Ben, at Story Trading, he is from Iran.
So he follows this very closely in terms of the war.
So he said opening up Iran for trade with America will be a massive boost for the U.S. economy.
Iran used to be a westernized country and an ally of America in the 1970s.
And Americans enjoy high fareability among the population in Iran when we believe the dips would be bought this morning.
So we went long the large caps.
And we said in this morning's note, all despite the fact that we don't see us testing around the 580 plus this morning, the price action, we believe the markets will averse and head towards a green close on the NASDAQ today.
Just a brief little overview, and I'll let everyone else kick it off, then we'll get more into it.
Yeah, really great stuff. I know I personally spent a lot of time over the weekend watching the history of Persia all the way back to the forming of the empire all the way up. So I was watching all this history. That's pretty much how I spent my weekend in case anyone cares. But I would say, how's everything on your side? And what are you looking on during all all the madness and then we can uh pass it around to the rest of the speakers i'm doing very well today i'm kind of
just holding in my normal positions and watching them move um i don't know if i want to talk about
specific tickers yet but we'll probably get into that one but for small cap defense um drones and
space it's been a pretty decent day given what's going on in the world.
Yeah, definitely. And I did not know actually that Ben was from Iran. I just learned that today. So really appreciate that perspective. But how are things going on your side, NatNap?
Things are going actually very, very well.
What happened this weekend wasn't, at least on my end, it wasn't really a surprise.
The market, they've been getting ready for a move like this for the past three weeks, right?
So on the last three weeks, every Friday, so full disclaimer, I have Oxy, I have XLE, and then I have the VIX, right? So every Friday we saw Oxy and XLE just go ahead and pump towards the end of the day
on Friday, kind of just getting ready for this move.
And then we saw it happen this weekend and they opened up beautifully.
So, but overall, not complaining, excited for this conversation.
I think a lot of us here, we have some experience in the small cap field. And I can't wait to dive into it today, Taj.
Thank you so much for bringing me up.
Awesome.
Really appreciate you being here.
William, how about you?
Anything on the macro side that you're looking at?
Of course, the event of the weekend kind of is on everyone's radar, but love to hear your thoughts.
Yeah, well, I don't want to sound too repetitive.
My comments are pretty much the same regarding what happened over the weekend.
What I've been very, very hyped on, though, is how much AI is disrupting a lot of software plays.
Like you saw that Duolingo clone get made in like one day with perplexity and Duolingo stock dropped like 25%.
I forgot the exact amount.
But I think we're going to continue to see a washout of a lot of these, like, really just, I wouldn't say overvaluate.
That might be the wrong word, but a lot of these, like, software-based companies, these SaaS companies.
So I've been very bullish on hardware, hardware companies and, like, you know, raw materials, rare metals, freaking, like, robotics, all that stuff.
I'm actually looking at a lot, a lot of companies in that space that I feel are undervalued that are producing amazing chips or amazing hardware-based tech. So,
really excited to get into today's conversation. I have a lot of stuff I'm pumped about, man.
Yeah, really cool stuff there. And of course, a while ago, the theme seemed to be AI killed
all of software and SaaS businesses, but obviously people just overreact to everything.
Not yet.
Yeah, not yet.
Ryan, my friend, I'll pass it over to you.
Yeah, thanks for having me in, man.
Glad I could fill in.
And what's going on, everybody?
So I guess maybe just to start, full disclaimer, I am not a financial guy or markets guy.
I'm in software, and I just spend a lot of time on spaces, listening to really smart people.
And apparently at one point somebody said, well, you know, maybe he kind of knows something here and there.
So my experience around the markets is really primarily due to just my everyday interaction in the world of business from a software standpoint.
So hopefully it's real and it's raw.
And I'm a, you know, I'm an investor every chance I get.
So from a small cap standpoint, well, let me back up.
Well, let me back up. Yeah, certainly a crazy weekend. I started to rotate out of some of the, a lot of my tech plays, I should say, back in September of last year and started moving over into things like the XLI, XLB, the manufacturing stuff.
Yeah, certainly a crazy weekend.
the manufacturing stuff, you could kind of see it coming.
I believe, whether you like them or hate them,
Trump and the administration, they sort of telegraph everything that they're doing
if you're able to listen and read the alpha
and filter through all the noise and the sarcasm and everything else.
And it was clear to me that, you know,
2025 was all about big tech,
Apex spending.
And if you think about a business the way it works, right?
If you're going to open a pizza shop,
you essentially have to have the money.
Then you find either an existing store or you build one, you start
spending the money. And then hopefully at some point down the road, six, nine, 12 months,
you can open up your doors for business and you can start generating revenue. Well, that's exactly
what's going on in all the big tech. That's why you're seeing some drawdowns, some of the overvalued things get beat up hard. So I rotated out into a lot of more defense stuff.
I have been in IWM going back to right around 205, 207, which was last year, I think in May.
Once it took that big dump and then kind of came back up and reclaimed uh the top of that v i jumped in so
that's my largest small cap and then i get i'm very strategic about a number of other tickers
and i'm happy to talk to you about those but what i would say i'm doing now is i am now trimming
again it's just me personally i'm trimming all my defensive stuff to raise cash
because I want to be a sniper and when it comes to a lot of the big drawdowns that are being
that are happening in you know all that tech stuff that that really was running so hard. And so, you know, when I see something get beat up like MBIS, right,
I'm jumping in there.
I'm looking at AVAV today, which is the drone company.
I mean, they're just getting slaughtered.
Raymond James double downgraded them.
But at some point, it's going to make sense where it'll be in the fair value gap again,
pick up some of that um so that's really what i'm doing i'm sitting on cash and i'm trying to be a sniper
to try to front run what i think will be kind of late end of this year into next year where all the big tech will run again.
And so just one final point, going back to what I said about Trump, it was clear that
2026 is going to be about Main Street.
You look at interest rates, they're coming down.
interest rates, they're coming down. You're going to start to see the mortgage industry,
I think, unfreeze. You're going to start to see people being able to sell houses, move houses,
buy houses at lower rates, which obviously creates a lot of liquidity in the market.
And so a couple, you know, I'm buying things like Nail right now, N-A-I-L, which is a 3x
leverage, uh, bull ETF for, uh, home builders and materials, um, buying things like Rocket Mortgage,
um, so that, I don't know, maybe that was, uh, too much Wolfie, but, uh, that's what I got.
It wasn't enough, man.
It wasn't enough, personally, in my opinion.
It's been pretty interesting there,
and I really appreciate that, you know,
bringing out the points.
Obviously, cutting through the noise is the theme.
Very difficult to do at times,
but if you can do that,
obviously you can find different things.
But I'll pass it back to you, Rhett.
You know, as we dive into a little bit more specific things,
I'd love to hear your thoughts or response to what any of the other guys have said.
Yeah, definitely.
I think it's a crazy landscape that we're living through.
I mean, you're seeing some of these companies that are with Claude
and the Claude bot and all that stuff getting built in this Sassapocalypse that we've seen forming over the past couple of weeks.
It's crazy to see the landscape and how these companies are being significantly affected.
With that being said, I'll get right into our couple of picks because I know we're running
short on time because we have our 130 mob CEO discussion.
So the two picks that I'm looking at is going to be air and ASTS a air just got a upgrade this morning by William bear a 50 to 70 dollar
fair value and they're saying it's a 1.5 to 2 point I think it's a 2.3 billion
dollar TAM and what caused that was um they're saying the burn-in tools for AI processors alone in 2020, 2030.
So they captured 30% of that of the $1.5 billion to $2.3 billion TAM.
Air is going to be able to capture 30% of that, they're saying.
So they had a nice upgrade this morning.
And Ben at StoryTrading, our chief StoryTrader, he gave our community a $50 to $100 target.
And we still are staying
firm on that. And I believe in the coming days, we probably will see AIR hit our first target of
$50. We saw a nice move on it this morning and pulled back a little bit. And the other big one
too that reports earnings after the close is going to be ASTS. They had huge news this morning. I
don't know if you guys saw that yet, but they signed with Orange a deal for
direct-to-device in Orange Markets. And Orange alone has 310 million customers. So, I mean,
that's huge. They just keep making connections and partnerships. And I think ASCS long-term
is going to benefit significantly from that. And yeah, that's my thoughts so far.
Yeah, really, really interesting there for sure sure uh now i really appreciate that
very very good points um now william uh pass it to you is like anything uh that he mentioned
kind of uh jumps out at you if there's anything that you'd like to uh add on that really would
appreciate that and then crispy afterwards no it's all all good. I mean, there's a lot, definitely a lot of great opportunities in
these markets. That's one thing I really enjoy about seeing these massive repricing moments,
these massive drawdowns and mass volatility and chaos, if you will, is that if you just look
closely enough and keep your eye on the ball and maybe find one or two opportunities, you can
really bolster your performance, your portfolio's performance, and possibly find some diamonds in the rough.
Personally, back in the day, I mean, this isn't really a small cap I've been looking at, but I
mean, there's obviously like before getting into the hardware stuff, I wanted to kind of touch on
this. Something I'm looking at adding to my position right now is like stocks like Robinhood,
for instance, like you have a company that's making tons of money that has attached itself to a lot
of different verticals. And I just don't see really the reason why it's tanking so much.
I think financial software companies like obviously Robinhood being an app application
primarily, but being like kind of that bottleneck to access to these financial markets and being a
pioneer in the space really play into it.
And the fact that they're making so much money on their prediction markets and they're projected to make even more, I predict more money, no pun intended there, in the near future.
I think it's grossly, grossly undervalued at these prices.
So I'm looking at allocating a lot more on that front there.
On the hardware front, I've been looking at this
stock, AVA. It's A-E-V-A. They are a LiDAR chip company. NVIDIA is actually purchasing
their LiDAR hardware for use in some of their fronts and some of their applications. So that
was one reason I'm bullish on them. But for a multitude of reasons, I think that autonomous vehicles, autonomous robotics, while we're still very early on it, I think now is probably the
best time to start looking into companies who are producing hardware or sensors for these
autonomous vehicles and these robots, just because I think it's going to exponentially scale in the
near future. Maybe we're 10 years off, maybe we're five years off. I don't have a crystal ball,
but I think companies like Ava being you know valued at five billion dollars uh especially with you know how
many one how many deals are growing they're closing they just recently closed uh not closed
sorry they just recently revealed uh i think they beat their revenue estimations by like 50
if i'm not mistaken i don't have the data in front of me at the moment but i think they're
expected to earn like way more money in the near future.
Stocks at a great price, in my opinion.
Technicals look good.
All in all, I've been allocating a lot to that position just because I'm super bullish
on where we're going with autonomous vehicles, robotics, et cetera, even though we might
still be pretty early on that front.
So those are the two main ones I'm looking at.
Obviously, HUD being a lot more of a mid to large cap there, but Ava being
the smaller cap of the two. Very interesting there. Crispy, any specifics you'd like to add on to that?
I like that you brought up Ava. That's one that I played last spring into early summer,
like March and April, and I bought it for sold in the sixes and thought
I was a genius and proceeded to watch it run to 30. So that's what I have a lot of mixed feelings
on. But in terms of my own portfolio and the things that I'm watching, I primarily invest in
small caps, like a lot smaller than what has been discussed so far. So the positions I have,
my portfolio is blocked
out into three main sections. I have my littles, so my small positions, my middles, my medium-sized
positions, and my biggles. I try to keep it, biggles are my large highest conviction plays.
I try to keep my portfolio allocated to 10 or under because I really focus on researching the
technologies, the contracts, and everything else. And if I spare myself too thin,
I find that I'm not keeping up on DD.
But my primary highest conviction plays
in my Biggles category is the Lightpath,
Unusual Machines, Ondas, Ascent Solar, ASTi,
and Rocket Lab.
Those have been my highest conviction plays.
ASTi is the only like newer one that I have a high conviction onto.
The other four, LightPath, UMAC, Ondas, and Rocket Lab, I've been carrying on from about
summer and spring of last year.
I only started investing this last year after the Trump administration came into the White
House.
I kind of saw this as the opportunity to get onto the United States manufacturing and
defense trajectories that I saw coming. And I couldn't sit on the sidelines and paper trade
in my head anymore. I had to get skin in the game. So I primarily played rare earths into drones in
space. And now I'm primarily focused on drone space and deep tech currently. So I do have other
kind of positions in the other categories
here my middle positions and my more speculative littles but again i'm one year into the market so
definitely not financial advice here i have melted down and i have built up i have touched the sun
and i have fallen back down to the earth so any plays are my own you guys are behind the buy button
bro you absolutely cooked with rocket lab my
god dude that's that thing is just oh man beautiful beautiful play on this is actually
my best performing i'm at about a nine bagger on on yes on this i have on this as well as one of
mine too it is and i i think there's still so much room left on on. Yeah, definitely. It's staying in my top five. It'll stay in there.
My cost basis is a buck08. So I can take much more significant drawdowns than most other
Ondas investors. Shoutouts to Joe Fats, M5, Global Macro, some of the other OGs that have
been in this name for a while.
Yeah, really interesting stuff there.
I see you showing some reactions there, Nat, Nat.
Like any thoughts onto this?
You know, love to have you back on.
Yeah, Crispy has a really, really solid portfolio.
I have on this as well.
That's definitely room to run in my opinion, right? I also have Archer.
Archer, they're an aviation plane.
They have a partnership with Anduril, right? They're also Archer. Archer, they're an aviation plane. They have a partnership
with Anduril, right? They're also playing into like the air taxi side of things. So it's going
to be very interesting to see how that plays out. It is still very, very much early, right? So it
makes it a little risky. But if they're able to get their ducks in a row, so to speak, I think
it can be a big, big winner. They also have earnings after hours today. So I guess all lies on revenue and feed, the growth aspect of things as well.
The other ticker symbol that I'm in is Grab, G-R-A-B.
They're in an Asia super app, but they recently acquired an autonomous company from China.
So I think they're in the building phase, which is also, you know, also
risky, also very early. But if they're able, you know, to kind of get things lined up to where they
need to be, I think that can play off. It can pay off greatly. What I look for when I am
investing into small caps, and I think we all do something kind of similar, right? It's kind of like
just getting in before certain things start to play out, right? because I think
it can pay big dividends in the next two to three years, right? We saw how these AI plays
paid very big, right? I was one that was into Palantir very, very early on. I mean,
I'm still shooting myself in the foot. I sold way too early, but I still was able to get some
nice gains on that. But my bread and butter is kind of just getting into those early and kind of holding, getting before the narrative, get in before things go crazy.
And then you'll see it pay big dividends over time.
And I see the same thing with Archer.
We did the same with Onda.
I think Grab, in my opinion, also Under Armour.
I know a lot of people are sleeping on this, but one thing that caught my attention a few months ago is there is this big, big, big investor. They call him the
Canadian Warren Buffett, right? He has just been buying millions and millions of dollars worth of
Under Armour. His average is just below seven. And they had an amazing earnings. They had amazing guidance. We're up very nicely on that.
That one printed over, I had calls on that.
The calls printed over 700% on that.
So I think there's still legs on display.
There's still room to run, in my opinion.
In regards to everything else, you know, I am in Oxy, as I mentioned before, XLE, just
a whole bunch of like mid to large cap, but
small caps, those are the place that I'm looking at.
Really appreciate those takes.
And before I just pass to Ryan, as we're getting ready to pivot, we do have the opportunity
to ask some questions to a CEO in a second.
And I just want to say, highly recommend that you follow all of these amazing people that
are on the panel. Not only are they into small cap, but like, as you heard, software stocks,
whether it is crypto, Bitcoin, like whichever area that you're in, not just, you know,
small cap investing, but just in general, just really great people to follow. So I highly
recommend you check out each and every one of them. William, Eva, who is in a meeting right
now, unfortunately couldn't hop on, but Nat Nat, Crispyan as well so i'll pass to ryan and then we go back to ret uh in a second
yeah i'll rip through these pretty quick um so there's a company out there called per p-u-r-r
which is uh hyper liquid strategies um you know the the push in crypto has always been
pushing crypto into TradFi.
This takes a different approach.
They're kind of taking TradFi to crypto.
I was fortunate enough to kind of get in on that big dip.
So that's one that I'm looking for.
It could be a 3 to 5x over the next few years.
There's another one called Hylion, H-Y-L-I-O-N, which is Sam Altman
backed, kind of secretive, but they are looking to create sort of a new approach to electricity
and modularize their approach. Obviously, it's a push towards the data centers.
uh, their approach. Uh, obviously it's a, it's a push towards the data centers. Um,
there's another one, uh, BTG bit to, uh, Bitcoin and gold. It's quasi ETF. If you look at the
charts, you'll see it's forming up pretty nicely. So it gives you some exposure to Bitcoin and gold.
Um, there's just a few more and then I'll give it back to you um what was the other two
oh yeah t uh which is t energy um we also what happened and hopefully everyone avoided it uh to
the eose t is essentially the same thing but here's the reality guys power is like if we don't solve the
power problem ai is you know it's it's it's basically going to be a new version of the
internet so in order to do that right these massive uh data centers need a place to store
their extra power in the event that they need extra.
TE is very different these days. Sorry. They have pivoted away from the power play from which they originally SPAC'd,
and they're now firmly in solar cell production through their Austin plant.
Yeah, that's kind of where I was getting to like, and that pivot. Um, but there's, I still believe that they're going,
that there's a part of their play that is towards providing storage capacity for energy. Right.
Um, what was the other two? Oh, OSS, uh, one-stop systems. And the last one was, uh,
was uh oh or kt orange cloud technologies gotten its butt kicked hard uh it just hasn't
done very well but there's um some chatter out there that they may be used as a reverse merger
for vv which if you're familiar with the nft craze back in the day, VV may go public through reverse
merger with ORKT.
So I don't see it dropping below a buck for at least a little while, and it could run
to three to five, being a little aggressive there.
But it's a short-term play. So you got to know when to get
in and when to get out. We're traders. We're also investors. So that's what I got. I mean,
there's a few other, but those are the big ones. So for me, at least from a small cap standpoint,
really great stuff there. And of course, none of this is investment advice. These
are just very smart people sharing what they're looking at. So do your own research and the tickers. This is a recorded space. So you can check them out and use some amazing tools. Of course, look at their financials and so forth. But I will pass it. Taj, I was going to say smart is a strong word, man.
Exactly right.
So I'm just a curious person on here,
and I will be the one to use a hockey reference.
Not very often that you hear Jamaican making a hockey reference.
But go to where the puck is going, not where it is.
So, you know, we'll pass that out there,
and I'll give it back to Rhett as we're getting ready to pivot
into this Q&A session.
Awesome. Sounds good. Yeah, a lot of great stuff you guys provided us with.
A lot of new tickers, actually, that you guys put on my radar, actually.
So I'll have to check out AEVA and a few of those other ones that you guys mentioned.
So I'm excited to do some research on those.
I have not seen Oren yet. I'm waiting for him to come on.
Well, that being said, I'm just trying to check everything to see if he's coming on here in a second.
Yeah, no worries.
No worries, my friend.
So in the meantime, you know, one thing I will throw up there since we have a little bit of time.
When Ryan mentioned Vivi, that is a name that I have not heard in years.
I completely forgot that they were even around.
So that's really interesting that they're in talks for a possible merger or acquisition or something of that nature.
I remember that was like the huge thing with, I think it was Marvel, if I'm not mistaken, some of like the really big IP that they had partnerships and so on.
Some of the really big IP that they had partnerships and so on.
And that sort of just faded into the moonlight of all the craziness of the NFT craze.
But really interesting.
I'm going to have to check that one out again because I completely forgot that company was even around.
I haven't used Vivian forever.
You just sparked my memory.
I was like, wait, Vivian?
He's talking about that app I used back in the day?
Yeah, yeah.
What?
Yeah, they're yeah
they're uh they're bringing they're making nfts great again um and it'll be a reverse merger just
fyi that's awesome yeah i actually have a lot of uh crypto plays i didn't i didn't divulge just for
the sake of uh time and simplicity but that's something i'll definitely be looking at but they
have all the nft rights DC, Marvel, Disney.
Like, I mean, it's the only one that you want to be involved in, I would imagine.
Yeah, really interesting stuff there.
And I thought it was always funny that they had both DC and Marvel.
I'm like, what?
Under the same roof?
Like, that's crazy.
But, you know, as far as what's out there, you know, some of these small companies that are just like inventing and experimenting with things, I think it's just always cool. So I really appreciate,
you know, putting those things onto our radar, because if you're anything like me, or most of
the people that are in the space, we love to research, we love to look into things. So it's
always great to have something that is definitely not going to get national headline coverage. And,
you know, you won't see that on CNBC or Bloomberg anytime soon so I really appreciate that and uh Rhett uh how are things going on the back uh otherwise I could
kind of uh you know some secondary thoughts as to um what you're looking into yeah sounds good I'm
still trying to see if he's up here I just sent him over an email so waiting to hear back from
Oren from Mobility Comm but but I have not heard anything yet.
But yeah, so other things I'm looking at, I mean, as you guys all saw with the drones,
I think it was LASR.
I don't know if you guys have seen that video yet coming out.
That company was up crazy with the, it was almost like what Ben said.
It was like Star Wars up in the sky, how they were shooting down the drones and all that.
So I found that very fascinating and interesting.
And that stock shot all the way up to $70 this morning to all-time highs,
and it currently pulled back.
So I'm going to continue to watch this one because it may continue to be in play
with headlines coming out with them using this technology in the war.
But, yeah, so let me check my messages here really quick.
But, yeah, that's another ticker.
I'm watching LASR if you guys want to cover any other ones at the moment.
I'm very familiar with Drone Encounter.
Drone Laser is Nlight.
They're very, very interesting.
And this has been a supreme validation of a play that V down there and the listeners,
as well as Black Skulls and Penny Check, have been on for months.
It's really interesting there.
So, yeah, it's great to also, once again,
you get the alpha from someone in the spaces that's researching this stuff
then to, you know, have it really pop up.
But one thing that I did really realize with all this war coverage and so on
is a lot of that, the drone technology of that AI plays and all that stuff and even the fact of
like anthropic uh possibly declining you know i'm not sure 100 like all the details of this but
declining a contract to get a little bit more involved into uh defense stocks and so on so
it's like there's a whole bunch of things going on with this conflict or just any conflict going forward that has small cap, it has AI involves, uh,
there's, uh, the drones and, uh, so many things overlap.
So it's just really interesting where this is going, but, uh, yeah,
I really appreciate that take right there. Um, I, um, I mean,
if we're still waiting, I do have one thing I would have liked to bring up
Taj if, um, if you would let me.
Yeah, 100%.
And we can see what's up with Fret afterwards.
Excellent.
I could also fill the air for a good amount of time as well.
Same, same.
I have so much.
I have so much alpha I want to talk about.
But since we brought up some crypto plays earlier, I feel like I need to bring this one up.
So this play that I've been adding to, it is like, for full disclosure,
you know, a crypto project
or crypto business, if you will.
But they launched their token
back in October.
It's EAT, it's E-A-T,
a company by the name of 375AI.
Essentially, they have
an exclusive partnership with,
I think it's Outlier Media,
the largest billboard company in America.
And they're installing these like $50,000 like
edge camera devices on all their billboards across the country. So why I'm bullish on this
has to be for like a lot of reasons. But mainly, we talked about like autonomous vehicles,
autonomous robots, you know, kind of becoming a thing in the future. AI, obviously, you know,
is a big topic right now. And AI really needs two things. It needs a lot of energy and a lot of data.
And so I think data, like everyone talks about, data is going to be the new oil.
I think this company basically acquiring a ton of traffic data, like literally so much traffic data on vehicles, which you don't really imagine it being so valuable.
imagine it being so valuable, but I mean, these cameras they're installing can track the exact
make and model instantaneously and like, like literally scan all these cars and all these,
like all these vehicles driving by, you know, really like, what was it? High traffic highways,
interstates, intersections, you name it. And sell that data to interested parties, namely,
you know, things like hedge funds who are trying to trade based on that data. And so I think that data has a lot of value there.
And I suspect at least some of that value is going to be trickling down to their token
that just came out back in October.
So I've been buying a ton of that token.
It's, again, EAT, E-A-T, and it's like a $3 million market cap.
If you guys want to talk small, like this is a small cap right here.
It's probably, you know, obviously high risk, not financial advice.
But I think the fact that they have this partnership established and that they're installing these like edge devices that, you know, are going to earn a substantial amount of revenue in the near future, I suspect, makes this a very interesting play to me.
So that's something I wanted to shout out if we're trying to, you know, fill the air here.
Really interesting stuff there.
One thing that I will say,
it's not exactly a small cap,
but we just got Warren up there, guys.
I just want to throw that out there.
Perfect time.
Okay.
Yeah.
So I'll say,
I'll save my take for another day and another time,
but yeah,
Orrin,
or I'll say back to you,
right.
And get that Orrin involved in.
Hopefully the panel will stick around and we can chime in here.
If we have enough time.
Awesome.
Sounds good. Sorry about that, Oren.
I do want to clarify that this is a sponsored segment of the X Spaces.
Now that this is out of the way, I want to introduce Oren El-Khayam, the CEO of Mobilicom, ticker MOB.
How are you doing, Oren?
I'm fine. Thank you. How are you doing yourselves?
Pretty good. Pretty good. Can't complain.
So we're just going to get right into it.
I want you to introduce yourself and what Mobilicom does.
So as I mentioned, as you mentioned, the CEO and co-founder of Mobilicom.
I'm based here in California.
And what Mobilicom does, we are the providers of the critical technology elements,
What Mobilicom does, we are the providers of the critical technology elements, the harder and suffering cyber elements that goes into drones, robotics, solutions.
And we enable them to operate.
We enable them to communicate.
We enable them to safeguard themselves against different kinds of attacks.
So we are the heart and soul of any future drone.
Awesome.
Thank you for that brief introduction of Mobili.com. I mean, everyone,
now the topic is today with the war and everything going on. So what do you see going on with the
war with the drone usage that you've seen so far over the weekend that you can speak about?
I mean, this war, like many of the other conflicts right now, signify again and again that drones are becoming one of the most used
weapon systems. Obviously, wars need intelligence and drones are used to gather intelligence and
stay in the sky for hours and sometimes days. Drones are the attack vehicle in order to
get to the right target and take long distances or short
distances and hit to kill. And we have the loitering drones, which is a booming market that
is expanding from the soldier level to the battalion level, all the different levels of
distances and operation. There are the anti-drone solution that attacking drones that are coming.
We see that as an approach that is scaling right now.
We have several examples of programs that we are right now working on
with partners on hives of drones that are sitting on the borderlines
or on the front lines.
And then when you have attack drones coming to your direction,
they are immunoplyed.
So it's clear that robotics and drones that are going to be at the front
and soldiers going to be at the back, the entire war and conflicts are changing,
and those will be used in massive numbers, and that's it.
We should expect that that will continue in larger and faster pace from year to year.
I need to be more exact from quarter to quarter.
Awesome. Thank you for that information.
I know there was a drone that got intercepted because it had the blockage or whatever.
You want to talk about that and how you're,
because I know you have the technology for that type of stuff.
You want to go a little bit in detail on that side of the business?
Yes. So we've seen again another example, that type of stuff you want to go a little bit in detail on that side of the business yes so um
we've seen again another example which is not new uh recently in the era gulf uh that were a drone
on a large drone of america that was used patrolling the area was uh jammed or intercepted or hacked
one of the three i didn't get report of what exactly happened, but I know that it was either
jam or intercepted, and then fell down from the sky. Obviously, as a big drone, strategic drone,
the cost of that is $50 or $100 million. So it's definitely a significant platform,
but we see the same thing on the smallest side of the scale of small size drones or mid-size drones so all of those are experiencing the challenging
environment of electronic warfare jamming interception and cybersecurity
will be something that we'll see more and more often that said Mobilicom
understood that pain and challenge early before everybody else. We are focused on drones from
2017. It's not that we are in the right place in the right time because it's become hype and nice.
It's because we're doing that for a long time of our life. So 2017 Mobilicom is focused on the key
critical technology and IP for drones robotics. One of the things that we brought is a software
defined radio,
which is secured and cyber-protected that enables you to operate in hard environments. On top of that, we brought the ICE electronic warfare protection suits
that enable you in specific activities like we see today,
where drones of America fell from the sky to have a solution for that
and being able to recognize the problem ahead of everybody else
to create a solution in fraction of a second,
milliseconds, so identify a threat, blockage, or jam,
and then do the right activities in order
to save the mission and continue to operate.
And this is the I solution.
And to future drones that are going to be fully autonomous
or semi-autonomous and active by themselves,
or as part of a fleet of, or a swarm of drones,
this is where we are headed.
The solution of the OS3,
the Operation Security, Safety, and Compliance,
which is the cybersecurity of the NVIDIA and Qualcomm AI edge computing on the drones robot, is the cure for such more advanced attacks that we will see going forward from the cyber side.
So Mobilicom is in the front front of the technology, IP solutions, and standardization in the United States of the things that are needed. We are combat proven both in Israel and Ukraine and also
validated and tested on those cyber elements and electronic welfare by the US by different
projects that we were chosen for. So the credibility is built from combat proven
in the field as well as from the fact that the US Armed Forces and the Department of War
has validated our capabilities
and chose us for significant, large program of record of America.
Awesome. Thank you so much for that information, Oren.
Crispy, do you have any thoughts or comments for Oren?
I see we have his hand up here.
Where do I begin?
Oren, a longtime follower of MobileCom, I do appreciate all the work that y'all have been doing over there.
One thing that I think that a lot of people that might be casually kind of like observing
the drone space might not understand about Mobilicom in particular is the two kind of
primary segments in which you're operating as far as like taking frontier Israeli cybersecurity
and compressing and building it to like the levels and of kilobytes in order to operate
on disparate hardware across the drone ecosystem but also the skyhopper data links the relationships
with peledyne there's a lot of there there and i don't really want to take over the conversation but
i kind of do but like just to kind of like start off with um what category drones are you primarily
kind of like targeting and deploying into as far as like group one through five? Or is it kind of like applicable to all levels?
So as you said, Mobilicum uniqueness is coming from two factors. One is the fact that we are
providing a one-stop shop of critical elements of hardware and software and cyber, which are the
heart and soul of drones. And by that, we are unique. We are starting by implementing and then integrating first the hardware solutions
with a very high gross margin of 50 to 60% of the hardware solution
because it's based on IP that Mobilicom own and have patents for.
And on top of that, we are cross-selling later the electronic welfare software,
the cybersecurity capabilities with a gross margin of 90%, again, based on unique technology that we have. While you've seen different cybersecurity solutions that can defend
large elements or your offices or different hospitals or critical infrastructure and so on,
they have all the room, all the power that they need,
and they are hosted in a very nice 19-inch track IT room.
But imagine that you have a small-sized drone in the size of your hands
or a bigger one in the size of a backpack,
which is the majority of the market that we are targeting,
and then those need to do the same cybersecurity,
different tools of protection, edification,
and solving the problem online.
How can you do that on a very small power consumption,
very small size, very small computing memory
and CPU that is available over there?
And that's the secret sauce.
We managed to take all the tools that are available
for large organizations and encapsulate them
in a very efficient way and bring them to high capability
in small size and form factor and affordable pricing
to meet the mass deployments of millions of drones,
small drones that will need them.
And that's the breakthrough technology that we've made.
We offer that to the small size drones, one group two of the five because this is the mass that we are going
to experience system that costs 20 to 30 000 on group one or systems of 50 000 on the group two
that are going to be replaced every two three years because they are going to be damaged very
fast you have recurring sale all the time and then licensing again and again and again of those
cyber and software, electronic welfare software protection.
And that's the beautiful mechanism of Mobilicom with high gross margin, a very lucrative business
that few, if any at all, can address that market today.
And we are being in the front front.
So that's the most interesting business that we see from Mobilicom scaling forward.
When it comes to the software-defined radio and the frequency hopping beyond line of sight,
where do you see kind of like potential when you're looking at the BVLOS, like rulings and like for,
I do definitely understand the defense aspect of it, but I
still think there's a massive addressable market when it comes to operating drones within like
commercial spaces, municipalities, and that like communication sector between beyond visual line
of sight, which is the Duffy report that came out a while ago, and being able to interoperate and
connect with larger air traffic control systems and larger kind of like software defines.
Do you have like an open architecture as far as like interoperability with APIs and like broadcasting across like air traffic control systems?
Okay, so you ask quite a lot of different things.
It seems that you have a lot of knowledge in the field.
Commercial applications. lot of different things. It seems that you have a lot of knowledge in the field.
Obviously, we are seeing the defense market as the market that is scaling dramatically because of the urgency in America to close the gap to Ukraine, Russia, and maybe in the future with
China that is in different league by itself. That is already bringing significant volume of funding and programs that are being allocated as we speak right now to enable America to produce in high volumes and bring the right technology made in America as fast as possible to the hands of the soldiers that need it.
And that's one thing that is happening right now.
And on the back of that, Mobilicom is scaling and will continue to scale from quarter to quarter.
In regardless of that, obviously, the biggest market going forward will be commercial delivery to the last mile.
OK, or activities of inspections of utilities or oil and gas activity.
You mentioned borders or grid lines of electricity or long range
pipelines, all of those are beyond line of sight
activity that you should master and do that
can save a lot of funding of doing that personally
by teams of the ground or helicopters
and other things that don't do it well and very expensive.
And it's a 10x at least difference on the cost.
All of those needs, those capabilities.
I cannot imagine that anyone will operate robotics
drone on production line or delivery drones or robotics
on the ground that we've seen some of them,
or a utilities activity of oil and gas above refinery
plant doing that without cybersecurity.
So everything that we are talking is, those are the easiest places to attack.
Ransom attacks is the easiest to activate over there.
And right now there is zero protection whatsoever.
More than that, the market is really ready for that
because every CEO of every company has to sign for their DNO insurance to be activated,
that they are aware of cyber issues and they've done all they can
to protect their company from cyber.
None of the drones that we have today, and I'm saying again,
none of the drones that we have today have any active cyber security
that meets those requirements as you see on other activities
of those companies.
So they understand the need and they are obligated to do that.
And therefore, the cybersecurity needs that we are providing will be crucial over there
for their insurance to be activated and to protect the C-level suite against being sued.
So that's one thing.
On the communication part,
obviously you need something that was past all.
The recent regulation change that happened several weeks ago actually said that everything that was valid for the defense forces
with US certified solutions that passed the cyber testing,
that passed the blue US elements that have non-Chinese elements and so on,
different regulations that they wanted that was applicable
for Homeland Security and defense,
from now on will be relevant for everything,
commercial, agriculture, delivery, and so on.
And that means that we want to have Made in America solutions
and solutions that were certified in America by America.
And this is exactly what Mobilicom has.
And I think that it's only limited the amount of players
that already have all the certification and capabilities
and only going to increase or elevate the hurdles or bars for others.
We are glad to be one of the few players over there.
There is five players in the communication that meets those things,
Mobilicom and the rest. Three others of the competitors are doing Wi-Fi, which is not safe
and not capable. That's definitely not cyber-wise, so it's a vulnerability by itself. And just
Mobilicom and Silbus, who are the software-defined radio solutions, Silbus was just acquired by
Motorola for $4.4 billion. That gives you some price tag for Mobilicom IP and technology.
We have the same technology and we can deliver that in 30% of the price
and still maintain a very high gross margin.
So I think that we are built for scalability even for the commercial market.
The new regulation, the new change only put Mobilicom in a better position
to scale faster in the commercial market as well.
And the cybersecurity that Mobilicom leads the market with is going to be a significant contributor to the growth of the company going forward.
And that's something that we have no competitors for right now.
I have one last question, then I'll step aside.
But I would love to have a deeper technical conversation with you in the future.
I could probably reach out to your team and set that up.
But in particular, GPS-to-night environments, PNT, positioning, navigation, timing,
what is your kind of technology through the Skyhopper and through other kind of hardware?
Because I'm very much in the atoms-over over bits camp as far as my investment portfolio.
But I'd be curious to be like,
what is your strategy for dealing with GPS denied environments
and like the current dynamics throughout Ukraine,
throughout Strait of Hormuz?
You have Iran, like GPS jamming is becoming persistent
and unrelenting.
And I was just wondering how your software
and your hardware is positioned to navigate this new environment.
And it's not even a new environment.
This has been something that you guys
have been working on for years.
So I don't want to say that it's new to you,
but it's very much very new to the overall narrative
and the overall ecosystem.
So the basic activity that we see right now
that is being deployed, which is the first tool.
I mean, let's discuss that.
If you want to operate a drone in a mission, and let's say on the borderline
or crossing the border, and later on on commercial side, the three things
that you're going to see is A, GPS or GNSS, general different kind of navigation
elements are blocking or jamming.
This is the first thing that you can see.
Second is electronic warfare that kills, jam, overcome,
kidnap the drone communication,
either by controlling the control of the drone
or by taking the information from the drone and so forth.
And the next level is penetrating the drones in one of the stages during mission,
pre-mission, whatever, and then operating things cyber-wise. And once the drones are flying and
carrying a drone, you can actually decide what they're going to do. And if you want, you also
can send them back home and let them explode over there. So definitely it's a, there was a three
tiers. The beginners have started with GPS spoofing or GPS jamming.
Spoofing is just manipulating it in the .
Those there is different kinds of technologies
that overcome that.
It's not really the focus of Mobilicon, by the way,
because already other systems are navigating
by picture and video or navigation by INS system, so on.
So we have partnership with others that we incorporate
capabilities that enable you to understand the spoofing or jamming
and then overcome that.
But the good solution are turning to navigation
by video analysis and other means or being autonomous.
The other levels, which are much more progress,
which is electronic warfare, jamming,
interception, takeover, and so on.
And the level-
Cyber over RF.
Cyber. And then the next level is
cybersecurity penetrating the application layer,
the elements inside the drone,
the computers over there.
Those are the areas that are more
lucrative that Mobilicom is handling.
GPS navigation is actually something which is not really relevant.
None of us is operating with GPS.
I mean, we do have GPS inside.
It's just for fun, just for easy times and situations.
Like a failback.
It's a failback.
It's an add-on.
It's an existing system.
It's timing thing.
It's good to have that.
It's the training thing and so on.
But in mission, GPS is not relevant anymore. Mobilicom is not using the GPS for any mission solutions.
That's exactly what I wanted to hear. Thank you.
Awesome. It looks like I believe Ryan had his hand up for a while. Do you have, oh, I think he may have fallen off there. I'm not sure if he's still here. Ryan, if you're there, you want to go ahead?
Oh, I think he may have fallen off there.
Not sure if he's still here.
Ryan, if you're there, you want to go ahead?
Yeah, I think he fell off.
He said he was driving, hit some bad reception.
But yeah, he was patiently waiting.
So if you have another question until he comes back up,
you know, we really appreciate that with only five minutes left.
But hopefully he'll come back.
But those of you that are just tuning in,
we're having a nice discussion about small cap discussions,
or small cap stocks.
And of course, right now we have a CEO of a company that we're asking questions to.
So I'll pass it back to you, my friend, Rhett.
Awesome.
Yeah.
Oren, a lot of questions that investors have is getting to the path towards profitability.
You want to talk about that and what your goal is to how to get there in your cash on hand um definitely it's important question so um mobilicom's cash flow positive
will be achieved by reaching 12 million dollar roughly uh in revenue a year which is translated
to three million dollar roughly a month a quarter um And that will be the cash flow positive
or cash flow run rate
from $3 million a quarter onward.
We believe that on the fact
that some of our customers,
the big tier in the United States,
for example,
have won programs of record,
which is multi-year guarantee budget
of program with the DOD,
which guarantee at least five years
and then can be extended.
That's already the path for us to get to a cash flow positive.
We estimate that as those programs are getting into mass production scalability,
which is happening now, we take them a few quarters to ramp up the numbers,
so we will deliver to them goods for this specific program,
only one of them even, into the volume of 3 million dollars a quarter.
That will bring us to cash a positive.
Our estimation is somewhere like three, maybe four quarters.
So end of year is a good timing for that.
We believe that based on that ramp up, we can get there very soon and very fast. And all
of those recent conflicts and solutions are just accelerating the demand and deployment.
More than that, we have right now, we published in the end of last year in Q4, we published
that we had $17 million cash in hand.
We will publish the end of year financial of the end of December.
You will see that we have more cash in hand.
We have additional $14 million to receive.
So we are sitting on a fully diluted, on over $30 million cash that we can tap on with more than 18 in bank.
And that means with a burn rate of three and a half roughly last year, burn rate a year,
we have years to go with the current funding.
And with the warrants money, we even have more than that.
So we don't need money.
We don't intend to take money.
We are able to get to the casual positive by ourselves, given the fact that some of the critical business milestones were achieved
in the end of 2025 and beginning in 2026.
And from our perspective, that's an amazing situation to be at.
We only see more customers integrating with us because they want a winning solution that
was chosen by America to programs of record of the government, which has validation again, again, and again.
And they want to do something with no risk on their side.
So choosing Mobilicon becomes that.
The cybersecurity electronic welfare are only creating more demand and more solution to our software.
We'll have more software mix.
More software and cyber mix means higher gross margin.
And that's the beauty of Mobilicon. And if I can say one thing else, so we have no debt, no convertibles, no credit lines,
more money that we need in the cash in hand, more money to receive on warrants that are already there,
and very short time to cash flow positive. Did I answer a question?
Yes, that answered it perfectly.
Thank you for giving that information for us.
Oren, do you have any final thoughts that you want to lead us for
and what you're looking forward to the most heading into these next 12 to 24 months
and especially with the war happening,
if that's going to ramp any more production up for drones in your software and technology?
I mean, the war is a catalysator for budget being deployed faster.
The war is also emphasizing the needs of either attack drones or protection drones.
Both of them we are active at in masses because those are small size drones
that are going to take down things that are coming towards you or going on the
other side and attacking the other side and we are known for those capabilities and shifting from
operations of ones to operations of many to operations of hundreds which will only increase
10 times or 20 times the market that we are involved with. So it's growth, growth, growth. This is what we see.
On another aspect for Mobilicom, everybody
here is a savvy investor that understand the mathematics.
And the mathematics is very clear.
Once we are getting to cash flow positive
and there is demand, the critical issue is scalability.
If we have to scale not one time, two times, three times,
10 times, going to be very, very high-growth company, our investors
