What's new? Five Promising Up and Comers!

"Suspend Your Disbelief!"

At the Sept 12th SeeThruEquity conference a presenting entrepreneur commanded, "Suspend your disbelief!" We did and ended up being intrigued by not only his pioneering at COYN, but also by KIPO, LTRX, MSHF and  TNTY.                                

By Robert J. and Brian D. Flaherty

On September 12^th my son Brian and I enjoyed attending the SeeThruEquity Investor Conference held in the Penn Club of New York City. There several promising very young companies made their debuts. We were searching for overlooked micro-caps with good management and reasonable stock market caps. Here are five we liked.

COPsync, Inc.'s President and CEO Ronald A Woessner started with a command, "Suspend Your Disbelief!" We did. With all we read about tracking information technology we were  sure that local, state and national law enforcement units are all linked so each can receive vital alerts and other crucial information in time to act. Nothing can be further from the truth and lives are being lost!

Our law enforcement systems are a virtual Tower of Babel and Dallas, Texas-based start-up COPsync, Inc. (COYN-0.10) wants to change that with its systems "for officers by officers."

The Lone Star State is a good place to start. About 1out of 12 of all law enforcement officers in America serve in Texas. There two thirds of the U.S. Mexican border crossings with all their drug, cash and weapons problems pass through and over Texas's broad highways into the rest of the U.S. About 218 law enforcement agencies staffed by 13,000 officers have the duty to protect us as best they can. With improved information technology coordination they can do even better.

Over 2,100 vendors of information technology have little interest in getting a uniform shared alert structure. By participating in one each would risk losing captive customers to rivals. Historically, in Britain police protection started locally and police were paid in copper coins. Hence the policeman's  nickname "copper." Law enforcement still tends to be local and each local agency still  fiercely protects their territory and their jobs.

This results in some local units failing to become properly   linked to state and national agencies. For example, COPsync's Woessner claims if you report a missing child in an unlinked locality in Texas that search could be done by just the few cops there. If that locality were linked up a state network Texas' other 13,000 officers could join in. Being linked works. One child was found 70 miles away. Not sharing alerts with other locals or the state officers can kill. Officers have died or been injured when they routinely stopped dangerous suspects but had not been warned about them or their vehicles by unlinked local units.

Long ago when Woessner was serving as general counsel and vice president of Amtech Corp (Nasdaq:AMTC), we wrote about its struggles to pioneer electronic toll collection systems including the Northeast's E-Z Pass and Florida's SunPass and others which today are used throughout the U.S. Has COPsync come up with a similar nationwide opportunity providing real time information and law enforcement alerts for police riding around in their patrol cars? The alerts are no good if the cops in the car don't have access to it. The need is there. Have you ever thought, "Where is a cop when you really need one?" I have.

A magna cum laude law school graduate and a summa cum laude graduate of Texas A&M University, Woessner operates the largest law enforcement real-time, in-car information sharing, communication and data interoperability network in the U.S. but his start-up is still very tiny. The COPsync Network enables officers to report and share actionable mission-critical data in real time and collect outstanding misdemeanor warrants in real time at the point of incident. It can provide officer safety alerts, GPS/vehicle locations and distance-based alerts for crimes in progress such as child abductions, bank robberies and police pursuits. It also can help on the small stuff of police duties too.

So far agencies in over 150 of the 254 Texas counties are on the COPsync information sharing network and using messaging capabilities to disrupt drug, cash and weapons smuggling and preventing criminal behavior. More are joining all the time.

All of us have been horrified by mindless attacks on schools and other spots but felt helpless to know how to counter them. The Network's companion COPsync911 system enables campuses, government buildings and businesses to automatically and silently send threat alerts directly to law enforcement officers in their patrol cars in the event of crisis. Teachers at schools across the county could be armed with technology to get help from attacks by terrorists or deranged people out to harm innocent children. COPsync is counting on subscriptions from schools to help in its march toward profitability.

The need for information sharing at the local and state level is obvious and can save many lives and help rescue many abducted children sooner. On a national level federal units such as the FBI and CIA need to share more with state and local law enforcement units. Sharing by the FBI of Russia's concerns about a brother might have prevented the Boston Marathon bombing. Sharing by the CIA of its reprimand of the CIA's former employee Edward Snowden might have prevented him from being hired and used by the National Security Agency. Naturally that would have prevented Snowden's massive leaking about warrantless wiretapping and embedded internet spying on everyone. Smile, Big Brother is watching you!

With a total stock market capitalization of $17.5 million  COPsync's early results are promising. Total revenues increased 39% to $2 million while gross profits increased 101% to $649,000 for the six month period ending June 30, 2013. Naturally COPsync will need a lot more growth capital to hire more sales people and expand more in Texas and begin spreading to the surrounding states. But right now CEO Woessner wants to raise a quick $1 million to $1.5 million to keep momentum up.

This is an important effort. Just getting more states and local law enforcement units sharing and cooperating more can do wonders. This technology can make life safer for law abiding people. Sharing over the COPsync network already has helped rescue an abducted child and saved a police officer's life. That's a good start! For more information visit: www.copsync.com or www.copsync911.com.

TRUNITY HOLDINGS LIVING TEXTBOOKS DEMOCRATICIZE EDUCATION:

This under $15 million in total market cap upstart is a change agent in the trillion dollar market place for e-learning worldwide. On the cutting edge of cloud-based education technology Anderton's mission is to use e-learning to bring the best knowledge to students everywhere in the world. He especially would like to help teachers uplift and empower the world's least advantaged students who have been locked out of the game by the high cost of printed textbooks. Success would change the world by increasing the productivity of those in the most undeveloped sections.

What would you want if you were a new student today? A traditional expensive  text book, old and stale by the time it was printed, or a much cheaper living e-text book updated all the time? Living text books can be combined with video and customized for your locality. They can be combinations of chapters from  several text books or the latest articles and sold at a fraction of the  cost to buy all the printed books from which  materials  in living books can be combined. So living books are  a very easy sell. Trunity is set up to sell a single school or in the case of the Ukraine Terry Anderton claims to have sold the entire country.  

He describes e-technology where text books can be broken into chapters or even small parts and combined with other parts of knowledge. Then local teachers can mix and match and create living textbooks and courseware which can be constantly updated real time on students' computers or mobile devices. Trunity's cloud-based platform hosts a community of 4,300 expert contributors, including scientists and educators, who create peer-reviewed education content. Additional content contributors include National Science Foundation and NASA funded projects comprising The National Council for Science and Environment, University of New Hampshire EPSCoR, Encyclopedia of Earth and Climate Adaptation and Mitigation E-learning.

Trunity can pay authors more than traditional textbook authors. Really? Because of the high sales and distribution costs of printed books, publishers keep over 90% of revenues. Not having those costs, e-books can keep about 30%, give the author 70% and still make the book more affordable with a much lower selling price. Authors could make more money because their potential global  market is so much larger.

Anderton envisions local knowledge centers in various parts of the world. In each local center knowledge can be contributed and then sold in segments as needed and combined with other media to make courses more relevant for that culture and area. He has thought it all through and is currently working with 170 universities in seven countries. He also gets information from prestigious outfits so researchers all over the world can track what is happened on and to the planet over time such as the extent of the melting at the polar ice caps.

In text books the movement to online digital is allowing people who have been locked out of the education market in Africa, Eastern Europe, India and South America to participate and become empowered. Coming out of retirement, Dr. Arol I. Buntzman, who has devoted his life to efforts to organize education and training programs to help break the cycle of poverty in the poorest countries of the Americas, has joined TNTY as Chairman and CEO. This frees Anderton to be president and concentrate on international sales.

Anderton claims next time this year his exciting start-up should reach breakeven revenues of $2.5 million and then be very profitable. He enjoys pushing advances on e-learning and e-education, especially for the poorer regions of the world.   He's done it before and will keep doing it until he drops. For more information please visit: www.trunity.com.

KEATING CAPITAL CAPTURES TECH IPOs EARLY: Technology successes have triggered most of the recent enormous new wealth gains. If you can't pick IPOs successfully yourself consider Keating Capital Inc. (Nasdaq:KIPO-7.02). This closed end fund, which sells at a discount to its underlying assets, operates as a business development company that specializes in making pre-IPO investments of $3 million to $5 million in emerging growth companies that are committed to and capable of becoming public within two years. Doing a real IPO where the company raises money to grow is a must. Reverse mergers were no new money is raised need not apply.

With the IPO market heating up Keating is poised to prosper as new enterprises in its portfolio of private investments go public. Lead by founder Timothy Keating, who graduated cum laude in Economics at Harvard exactly 30 years after Bob Flaherty, Keating leads a tight experienced group of venture capital veterans. New investments are in the $3million to $5 million range and Keating can be a lead investor or just join other savvy  partners. To try to  avoid the large losses which come from private companies which fail to perform Keating will not invest until a private company generates sales of at least $20 million. That way KIPO knows the prospect  is real and has substance not just hype. Keating also prefers prospects be in technology because that is the source of  today's  big gainers. Equally  important, technology  is the area his Keating team understands. Also new investments should have a potential return of at least 2 times Keating Capital's investment over a four year holding period.

With a modest total stock market cap of $69 million Keating itself just turned profitable and already has initiated two dividends for 2013. Several promising portfolio candidates appear to be maturing enough to go public, especially during the second half of 2014. KIPO offers a diversified way to participate in the upcoming IPO boom at a moment when the parent company is prepared to break out itself. For more information please visit: www.keatingcapital.com.

MEDIASHIFT's DIGITAL ADVERTISING + WIFI = HIGH GROWTH: Newport Beach, CA -based MediaShift, Inc. (MSHF-3.45) President Brandon Kensel hopes this start-up will prosper with the boom of digital advertising. Including both internet and mobile, it is the fastest growth segment of the advertising industry as media budgets are being increased to bring them in-line with current shift of media consumption away from print to wireless viewing.

MediaShift's strategy is to help monetize private WiFi networks and web publishing sites by offering these potential advertisers access to the fastest growing audience, especially business travelers on the move. It targets on-the-go consumers with an ad network built specifically for WiFi environments at airports, hotels, transit setting, retail and other locations where consumers regularly connect to a wireless hotspot.

MediaShift offers WiFi operators the only patented solution that monetizes WiFi networks at both sign-in through video advertising and mobile app downloads, and while surfing the Internet through display ads and infomercial videos. Consumers are demanding free WiFi access wherever they go and the proliferation of bandwidth-hungry content such as streaming movies, online meetings and always connected mobile applications is increasing costs for WiFi providers. MediaShift's patented technology enables WiFi operators to create new revenue streams from advertising that help facilitate free internet connectivity and offset the costs of network infrastructure. Management is expanding the number of airports, hotels and other on the go spots MediaShift is increasingly serving at a breathtaking pace.

MediaShift has an impressive top group, highly experienced in furthering the Internet revolution in media. Several would deserve a page all by themselves for what they have already achieved. For further information please visit: www.mediashift.com.

LANTRONIX'S TURNAROUND TEAM EXPANDS ITS PRODUCT MARKET PLACE FOUR TIMES TO $2.5 BILLION: President and CEO Kurt Busch of Irving, CA -based Lantronix, Inc. (Nasdaq:LTRX-1.44) knows how to keep the room filled while he speaks. "At the end of my presentation we will be giving away one of our xPrintServers. Just drop your business card in the box we will pass around and we'll have a drawing." (At the end of the meeting no one had left. Bob F closed his eyes and picked the winning analyst's card.)

Interestingly what the product did was never mentioned in Busch's talk as most of the group had been following the budding turnaround. This xPrintServer enables wireless printing from any iPad, iPhone or iPod to virtually any network printer. It's a great gift for students and for use by home businesses or executives on the go. No hassles, no apps needed, states the website.

"I want to talk to you about the opportunity in the machine-to-machine (M2M) space," Busch continued. "The first wave of the internet was people. The second wave was machines. Today there are more machines connected to the internet than people. By 2020 there will be 50 billion connected devices-about six devices for every person on earth. So machines will be the dominant driving force in Internet growth."

Lantronix has over 70 patents in the explosively growing M2M internet communications segment. Alas  as revenues from maturing products fell LTRX went into the red. So the board brought in this new turnaround team. The new iprinter and other new products are a sign the team is making progress.

Founded in l989 with over 10 years as a public company, Lantronix designs, develops, markets and sells networking and communications products with a focus on the convergence of mobility with M2M systems. It offers solutions that enable machines, devices and sensors to be securely accessed, managed and controlled. Currently Latronix's business is split in two. Half is in Original Equipment Modules (OEM)  and the rest in enterprise solutions and products which enhance M2M connectivity and productivity. It operates in the Americas, the Middle East, Africa, Japan and is building a growing presence in China.

Recent total stock market cap was under $21 million, trailing 12 months revenue was only $46.7 million and the bottom line was in the red. While revenues have started to rise again, Busch says, "Our results are nowhere near where we want to be."

Here is the strategic plan to make them better. The M2M market is so large that a tiny contender like Lantronix has to focus on niches and exploit its product strengths globally. Over 71% of its  enterprise solutions sales are in the U.S. OEM product sales also miss out of many geographic markets. So Lantronix has expanded its distribution channels so that all products will be available to be sold in all global markets. This will expand its potential products marketplace from $600 million to $2.5 billion.

Easier connectivity so mobile and other wireless devices can communicate with smart machines is going to be an enormous business. On its website Lantronix lists secure connectivity products for business, industrial safety, medical monitoring, nighttime security and equipment failure alerts. These will be huge markets. Can this tiny company get its share? President Busch promises more new products, profitable growth and better days ahead. For more information, please visit www.lantronix.com. -RJF.