Facebook is expected to file their S-1 for their IPO tomorrow. It is expected that Facebook will begin trading in May with a market cap of approximately $100 billion and they will likely raise around $10 billion in the IPO.
Already this evening in the financial mainstream media, the Facebook IPO is the #1 topic being discussed. As we approach the Facebook IPO, the media coverage of it will only increase and everybody in the world will be talking about it. We expect investors to soon begin searching for other publicly traded stocks that could benefit greatly from Facebook's IPO. NIA believes there is no publicly traded company that will benefit more from the Facebook IPO than BroadVision Inc. (BVSN).
BVSN had a huge day on Tuesday rising $2.91 or 14% to $23.94 on volume of 1,045,997 and in afterhours trading BVSN is up another $0.31 to $24.25. The enterprise social networking industry today is still in its infancy, just like the consumer social networking industry was three years ago when Facebook began its rapid growth. BVSN along with Jive Software (JIVE) are the only two publicly traded pure enterprise social plays that exist today.
BVSN just reported on Thursday evening that they signed 117 new Clearvale Enterprise customers in 2011, which was up 290% from the 30 Clearvale Enterprise customers BVSN signed in 2010. BVSN also reported that they signed 33 new customers in the 4Q of 2011 alone, which was more than the whole previous year.
BVSN's growth has now surpassed the industry leader JIVE. While BVSN signed 117 new customers last year, JIVE only grew by 113 new customers in the 12 months ending June 30th, 2011. We estimate that JIVE now has about 680 total customers, which is much more than BVSN's estimated total customer base of 147. However, JIVE has been offering their Engage platform for many years. BVSN's Clearvale Enterprise platform is newer, better, and cheaper. Over the long-term we strongly believe BVSN could grow to become much bigger than JIVE is today.
At BVSN's current price of $23.94 per share it has a market cap of only $108.09 million. Once you subtract BVSN's $54.4 million cash position and an additional $17 million for BVSN's old legacy products, BVSN's Clearvale platforms are being valued at only $36.69 million, which is absolutely nothing. For comparison purposes, JIVE currently has a market cap of $877.13 million and once you subtract their net cash position of $200.99 million, JIVE's Engage platform is being valued at $676.14 million.
JIVE's Engage is currently being valued 18.43 times higher than BVSN's Clearvale, when BVSN's Clearvale is now growing much faster! BVSN only has about 21.6% of JIVE's customers, but if BVSN's Clearvale was worth 21.6% of what JIVE's Engage is currently worth, Clearvale would be worth $146.05 million. Add to that BVSN's $54.4 million in cash and $17 million for BVSN's old legacy products and BVSN would trade at a market cap of $217.45 million and a price of $48.16 per share.
While JIVE's Engage platform is the market leader in terms of fully featured paid for enterprise social networks, Yammer is the current market leader in terms of limited featured free enterprise social networks. A story just came out today about how employees at Alcatel-Lucent setup their own Yammer network and after their employees had so much success using the free Yammer enterprise social platform, Alcatel-Lucent decided to deploy their own fully featured enterprise social network using JIVE: http://www.zdnet.com/blog/ hinchcliffe/enterprise-20- success-alcatel-lucent/1917
Although Yammer offers an upgraded version with more features that companies can pay for, it doesn't offer nearly as many features and functions as BVSN's Clearvale Enterprise and JIVE's Engage. Although JIVE's Engage is a very good top-tier platform, JIVE doesn't offer a free version like Yammer with the potential to go viral.
BVSN offers the best of both worlds! BVSN is now offering a free "Twitter like" enterprise social network called Enterprise Express that is better than Yammer and we expect it to soon go viral like Yammer. Any employee of a company can setup Clearvale Express for free at http://clearvale.com and begin communicating online with their co-workers immediately in a secure environment.
Once employees have huge success with Clearvale Express, BVSN offers a quick and easy way for a company to upgrade seamlessly to BVSN's fully featured top-tier Clearvale Enterprise platform. So while Yammer is losing the majority of their customers when their free users like Alcatel-Lucent finally decide to upgrade to a paid fully featured network, we believe BVSN will keep the majority of their Clearvale Express clients and we will see most of them upgrade to Clearvale Enterprise.
When Clearvale Express begins to go viral as thousands of people around the world learn it is a more useful free network with better features than Yammer, we believe BVSN will quickly catch up to JIVE in terms of total paid customers. JIVE does not offer a free version of their platform and therefore we believe BVSN's Clearvale Express gives BVSN a huge advantage over JIVE.
The biggest catalyst we see coming for BVSN in the near-future that will further set BVSN apart from JIVE is BVSN's upcoming Clearvale Nexus. This new platform being developed by BVSN will soon become a major game-changer in the industry. Clearvale Nexus will allow BVSN's Clearvale Enterprise users to access a directory of other Clearvale Enterprise users at different companies and through Clearvale Nexus businesses will be able to form new partnerships with other businesses and collaborate with them through Clearvale in a secure environment. This is something that no other enterprise social platform in the world does. Clearvale Nexus has not yet been officially announced by BVSN, but when it finally is we expect BVSN to become one of the biggest plays on Wall Street.
NIA believes the run BVSN recently made to $44.75 is small compared to the run BVSN could soon make in the months to come as we get closer to the Facebook IPO. The month of March is going to be absolutely huge for BVSN. We expect BVSN to receive massive international exposure at the Digital London Summit conference on March 13-14. Go to http://www.digitallon.com/ and look at what company logos are on the homepage. The main attractions of the Digital London Summit will be BVSN, Adobe, Microsoft, Cisco, and Juniper. These are all multi billion dollar companies that are going to be making their presence felt at the Digital London Summit along with BVSN. The Mayor of London is even going to be participating at the summit!
After the Digital London Summit, think about the massive worldwide media attention BVSN could potentially receive as we approach the Facebook IPO a short time afterwards. BVSN's CEO will be speaking there about How Social Networking will Change the Way We Work!
NIA loves how BVSN's CEO owns 36.7% of his own company. JIVE's CEO only owns 1.85% of his own company! Speaking of BVSN's CEO, check out this old BusinessWeek article: http://www.businessweek.com/1999/99_39/b3648002.htm
It is called "The e.biz 25: Masters of the Web Universe" and names the 25 Internet pioneers who are changing the competitive landscape of almost every industry in the world. On the right side of the page there is a vertical box displaying the names of BusinessWeek's Top 25 Masters of the Web Universe along with their company names. You will see such people as Jeff Bezos of Amazon, Meg Whitman of eBay, and as you continue down right underneath Louis Gerstner of IBM you will see Pehong Chen of BVSN! Interestingly, also on the list is Masayoshi Son of Softbank, a $31 billion Japanese company that is now reselling BVSN's Clearvale social platforms to their own partners and customers!
If you would like to receive NIA's exclusive Social Network Stocks 2012 Report, please go to: http://inflation.us/social2012.html
Disclaimer: NIA currently owns 146,000 shares of BVSN. NIA agreed to a 60 day holding period on its initial position of 122,000 shares starting from the date that NIA first suggested the company, but NIA intends to sell these 122,000 shares at some point in the future after the date of February 12th, 2012. NIA intends to sell its additional 24,000 shares of BVSN and can sell them at any time. NIA reserves the right to accumulate more shares of BVSN at any time. NIA's co-founders have also been referred business in the past from somebody who has filed as a large BVSN shareholder. Past performance is not an indicator of future returns.
NIA is not an investment advisor. This email is not a solicitation or recommendation to buy, sell, or hold securities. Never make investment decisions based on anything NIA says. This email is meant for informational and educational purposes only and does not provide investment advice. NIA's co-founders have previously disseminated information about BVSN in other media outlets.
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