Mobilicom presents a compelling investment opportunity as a first mover in the $34 billion drone market, offering a unique end-to-end value proposition. It has established itself as a key player with proprietary solutions that enhance drone performance, offer comprehensive cybersecurity, and ensure faster time to market. The company's product suite, serving as the 'brain' inside drones, includes SkyHopper Datalinks, Ground Control Systems, Mobile Mesh Networking, the ICE Cybersecurity Suite, and CONTROLiT cloud management. These products work cohesively to control, guide, and protect drones from cyberattacks, offering significant competitive advantages in the rapidly growing small and mid-sized drone and robotics market.

Mobilicom’s intellectual property consists of trade secrets and 34 patent claims across two patent families issued in the U.S. and other countries, reinforcing its position as a leader in innovation. With over 50 customers across 18 countries, Mobilicom has achieved notable market penetration through "design wins". The company's 50 design wins to date provide a robust foundation for long-term revenue growth, with each win representing a large manufacturer that has integrated Mobilicom’s systems into their drone and robotic solutions. Mobilicom recently bolstered its market presence with significant contracts, including a $900,000 order from a major Israeli defense firm, a follow-on order from a U.S. Tier-1 customer for its SkyHopper PRO datalink system, and an initial order from Israel Aerospace Industries for its SkyHopper Pro Lite, highlighting the Company’s strengthening foothold in the global defense and aerospace sectors.

Financially, Mobilicom is in a strong position. With a gross margin of 62% in 2022 primarily based on hardware sales, the company expects its revenues to be increasingly driven by Software-as-a-Service (SaaS) sales and recurring cybersecurity revenues from 2024 onwards. As of June 30, 2023, Mobilicom had a cash balance of $10.6 million, a low burn rate, and no bank debt, indicating a solid financial footing for future expansion. In summary, Mobilicom offers an attractive investment proposition given its first-mover advantage in the drone market, unique end-to-end offerings, expanding customer base, robust financial position, and significant potential for growth.

• Leadership in Drone Cybersecurity
  • Developed ICE Cybersecurity Suite specifically for small-sized drones, validated and used by the Israeli Ministry of Defense.
  • Recognized need for cybersecurity in drone market due to ongoing global conflicts and increasing corporate usage.
• Unique Market Positioning with Robust Business Model and Market Presence
  • High-margin repeat hardware sales combined with software and cybersecurity recurring revenue model.
  • Capitalizing on the rapidly growing small-size drone market.
  • Solutions tailored to balance price, size, and performance ideal for commercial uses.
  • Only one-stop-shop provider of critical systems for commercial and defense drone manufacturers.
  • Ability to penetrate markets with hardware offerings and expand by cross-selling software and cybersecurity solutions.
• Impressive Clientele and Diversified Approach
  • 50 design-win customers including 8 top-tier drone and robotics manufacturers.
  • Blend of cybersecurity, software, and hardware solutions provides multiple avenues for success.
• Significant Business Inflection Point
  • Approaching a turning point with sticky design-win go-to-market strategy.
  • Transition from design-win phase to initial production with deliveries to the Department of Defense.
  • Significant penetration in Israel and the EU, expanding into the US market.
• Influence on U.S. Cybersecurity Industry Standards
  • Contributing to the U.S. Cybersecurity Industry Standard and actively engaging with U.S Congress to advocate for stronger drone cybersecurity.
• Strong Financial Position
  • Secured $13 million USD in funding, maintains around $11 million in available cash.
  • Free of bank debts, loans, working capital debt, or convertibles.
• Intellectual Property and Proven Expertise
  • Strong granted IP rights (34 patent claims across two patent families).
  • Over 15 field-proven products used globally.
• Experienced Management Team
  • Track record of successfully scaling companies from startup to growth phase and leading mergers with larger corporations.

RedChip Investor Group Call with Mobilicom (NASDAQ: MOB)

Thursday, February 8, 2024

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