Bluechiip continues to hit milestones (BCT.AX)
Since posting about Bluechiip in November last year, the company has made a significant amount of progress.
At the time, I put together the following amibitious timeline of events based on the companies announcements:
Late 2011 - Further details on 3rd collaboration agreement
Early 2012 - Conclusion of existing collaboration agreements
Early / Mid 2012 - Initial product sales
Mid / Late 2012 - Capital raising to meet demand / expand product offering
Late 2012 - Cash flow positive
Any new technology startup hits road bumps along the way and it is not unexpected for timelines to get moved forward regularly, but to Bluechiip's credit they continue to hit their milestones.
Here's what's happened in the last 11 months:
30 Jan 2012 - Small placement $473,000 ($0.20)
Q2 2012 - 430k cash burn
March 2012 - Details of 3rd collaboration agreement (Leading biorepository and biobanking services provider - Executed Collaborative Evaluation and Pilot Agreement in September 2011)
March 2012 - Small placement $750,000 ($0.20) plus 1.25m options ($0.20)
Q3 2012 - 936k cash burn (higher due to ramping up commercial production and sales activity
May 2012 - Engages Plexus to manufacture commercial readers
May 2012 - Australian Synchotron begins using Bluechiip technology as part of a research program
June 2012 - Receives first sales order from ATCC
July 2012 - Roy Finkel joins the board
August 2012 - Strategic partnership with Gentris Corporation
October 2012 - Co-development deal signed with Inpeco to use Bluechiip in automation systems
So in that time, Bluechiip has had its maiden first sales and added some new significant relationships bring the total to five (Corning, ATCC, Australian Synchotron, Gentris Corporation, Inpeco). This adds significant weight to Brett Schwartz's repeated comments stating that the market is driving the commercialisation of the Bluechiip tracking technology. Despite this significant progress in a very difficult global environment, the company is still trading at similar prices to its IPO.
An article in the AFR on October 16th quoted Brett Schwarz:
I don’t want Bluechiip to have $200,000 worth of revenue or I might as well walk myself out the door today. Bluechiip will have millions of dollars of revenue this year.
While it's still early days to get an indication of the profitability of the Bluechiip tracking solution, it is a significant market size and Bluechiip have a unique technology with first mover advantage which should lead to significant profits.
On the online forum, Hotcopper, Brett Schwarz has stated that revenue is likely to be $1-2m for FY13 (conservative), while Baillieu has put out a report predicting $5.3m for FY13 which Bluechiip is hoping to beat.
The bio repository market is growing at ~200m samples per year with ~2b currently stored. As a guide to the market potential, if Bluechiip can earn $1.00 / vial with a 10% market penetration that is ~$20m / annum. If they can navigate the technical hurdles to begin tracking the existing stored specimens that could drastically increase the upside potential in these early years of commercialisation.
Brett Schwarz was also on Sky News today:
With a current fully diluted market capitalisation of ~$30m, the technology seemingly proven in the market place and a management track record of hitting targets, Bluechiip looks set for great things in the coming years.