Hi Fact Finder and Yak52
All in my opinion of course
Sean Hehir interview with the strawman 28/03/2022
At the 42.18 minute mark the Strawman asked a question basically when will brainchip be in a position of breakeven .
Quote Seans answer "Remember when i talked building up to 100 people or so this year, we think at that point we actually at a pretty good size scale and were are going to say after that the revenue growth will start to outgrow the expense growth pretty rapidly, thats the model that were going to start to see in leverage"
Now the captions in the interview at this time says "start to grow the expense growth" but if you listen closely to Sean in the interview he says "start to outgrow the expense growth"
He also states " He has a model"
He also states "Line of sight"
I believe this is the correct time frame for when Brainchip will reach the breakeven (from end 2022 into early 2023) if nothing out of the ordinary has happened internally since
IMO Sean would have a Strategic business plan in place with a timeline of objectives based on internal information including hiring a CMO and business expansion etc etc
Things change thats business, but going to trust what our CEO has stated in the interview which was less than 2 months old.
So for the first time Fact finder I'm going to go with my point of view over yours, sorry!!!!!!!!!!!!!!!!!!!!!!!! (Dont hold it against Me)
It is all a question of interpretation as to the "when".
What I do not agree with is your idea that this has any chance of being 2022. The 100 staff is the number for the end of 2022. The CEO has clearly put that once they are at 100 staff then
"the revenue growth will start to outgrow the expense growth pretty rapidly"
The way you interpret the word 'start' and I interpret the word 'start' is the point of difference if for the sake of this discussion we assume that 100 staff will be enough.
We have 'start to outgrow' and we have the expression 'start to catch up'. To 'start to catch up' is readily interpreted as not yet caught up but catching up. I personally prefer to take this as the meaning of "start to outgrow" as to do otherwise is to imply a sudden and immediate balance occurring between income and expenses rather than a catching up of income with expenses.
The CEO Sean Hehir has also stated plainly that income is likely to be very lumpy meaning not a perfect uptrend on a graph. The last quarter illustrated what he was saying regarding this perfectly.
Now I come back to the 100 staff being the correct number. Of course Brainchip will have a line of sight that they are working too but how many of them have built a company that is commencing an industrial revolution? None.
So this line of sight is really an educated guess.
The former CEO Mr. Dinardo when they were not marketing AKIDA the way it is now being done said they had "well north of 100 NDA customers". This number of potential customers was achieved in circumstances which the current CEO Sean Hehir has been critical of in the sense of the level of marketing that was being undertaken to make the
"best kept secret" no longer a secret.
The idea that 100 staff will be enough is also an educated guess but Intel has a plan to hire 11,000 engineers over the course of this year and Nvidia 3,000 engineers during the same period. It does strike me that if Brainchip does have explosive sales 100 total staff might not be exactly the right number to cope with that event.
Then you have to consider the number of sales and marketing people to match the increased demand in the above scenario.
My point is not that Brainchip is not going to be successful but that success is and should be more expensive than you plan for because you cannot have too much success in the context of trying to capture the future of Ai at the Edge.
The CEO has put the 'start to outgrow' after reaching 100 staff stating "
100 people or so this year, we think at that point we actually at a pretty good size scale and were are going to say after that the revenue growth.."
Now I am not going to say that the CEO Sean Hehir is wrong but only a few months back Anil Mankar and Peter van der Made spoke of needing to have 60 to 80 staff by end of 2022 so unless you credit them with absolutely no idea what they are talking about I think it is fair to say that this is an evolving number not one locked in stone and it will be continuously revised as present and future demand is realised.
I always adopt a conservative approach but from my experience growth always costs more than you expect but as I said this is not a bad thing far from it it means they will be over delivering on their best estimates of what is likely.
My opinion only DYOR
FF
AKIDA BALLISTA
, but when you are a key man in an organisation it is the only responsible action to take.
