|
|
|
|
|
CEOCFO Monthly Analyst |
H-NET.NET
- the leading provider
Technology H-NET.NET,
Inc. 345
Third St., Suite 645 Anton
Stephens
Interview
conducted by: CEOCFOinterviews.com BIO OF CEO
Anton
Stephens - President and Chief Executive Officer of H-NET.
An experienced software systems executive with a degree in Computer
Science, he developed the software system for complete control of a large
auto-dealership for General Motors. His background includes management and
development of healthcare systems, financial systems and the development
of the CBS Records Financial/Royalty Payment computer systems. About
H-NET.NET, Inc.
H-NET.NET, Inc. is the global leader in providing B2B e-commerce
services to the vision care industry. The company is positioned to become
the central hub for all vision care e-commerce with its one-stop
multi-service Internet portal and Internet-based transaction processing
services. The company is the leading provider of enterprise software for
the vision care industry including retail opticians, retail chain home
offices, optometrists, ophthalmologists and optical labs. Services
such as: next generation business application services:
automated telephone operators improving patient care and relations,
customized development for doctor to patient or business to business
electronic commerce. We have advanced hosting capabilities allowing
practices to go "virtual" with any packaged software or email,
database or media. Our Web
Portal is a complete vision care community, with
state of the art education, training and much more; each is a business in
its own right with its own revenues. Cooperating
with our Partners we offer, build your own e-commerce site
on-line, domain registration services, business search engine and site
marketing and promotions. Offering a wealth of conveniences to doctors,
translates into revenues for H-NETฎ! It's growing everyday and we enjoy
success as the technology partner of today's vision care professional. Our
IT partners, Microsoft, Compaq, and IBM continue to co-operate with us to
offer our clients the very best! CEOCFOinterviews
- Mr. Stephens can you give us a
history of H-NET? Mr.Stephens:
"H-NET is now in its seventeenth year of existence. Our
original company name was Alfa-Bites. We began in the general medical
industry as a whole, and then graduated into concentrating on the vision
care industry. At this point, we are also taking our current services to
other industries within healthcare. We have marketed extensively on a
global basis to very large customers, such as Lenscrafters, to procure a
substantial amount of people. So far, we have issued over 6 thousand
licenses. Fundamentally, our products were software packages that people
had used, in which we updated and maintained the relationships with the
customers. However, going forward, we changed our strategy about a year
ago, now providing world based services inter-linked with the most current
kind of our software that allow for electronic communications." CEOCFOinterviews
- Where do you envision H-NET to be a year or two from now? Mr.Stephens:
"The company will be fully fledged in terms of deploying the
electronic communications with all of the world based services and we will
have transformed ourselves to where we will also have ASP related services
to augment everything else. We expect the company to do very well on a
global basis. The starting point is in North America and then we will
stretch. The contracts that are being currently negotiated span all the
way from Europe to Latin America, to the Middle East. We expect to have an
international presence in the next few years." CEOCFOinterviews
How will you develop your international presence? Mr.Stephens:
"When required, we will open facilities. However, that is not the
intention. We have partnered with major players in each of the countries
we are going into, where we will support them. In time they will support
their own customer base, that we will help procure." CECFOinterviews
Who are some of your established partners? Mr.Stephens:
"We already have established
partnerships with Microsoft, Compac, IBM and right across the globe with a
whole host of other partners." CEOCFOinterviews:
"Is your product sold strictly through partnerships, or do you Mr.Stephens:
"In North America we have our
own sale staff. We also have partners in terms of retailers, which have,
as of the spring of this year, begun actively promoting our products. Most
of the deals we have made in other countries call for us to work together,
since most of the contracts that we are negotiating are fairly large and
no one partner can actually do all the work on their own. They need our
expertise to help put it together." CEOCFOinterviews
- What is your most recent and exciting news? Mr.Stephens:
"Since we transformed ourselves
we have started actively marketing the web based services and we have
recently noticed that people have begun not only using almost all of the
services but they are coming back. A good example would be the continuous
education part of our services, where we see, that the same people are
coming out and taking different courses that we provide. The most recent
one that we have put out is Streaming Media on the web itself. People are
very excited about it" CEOCFOinterviews
Is your
product pipeline built through acquisitions or research and development? Mr.Stephens:
"To date we have stayed away from acquisitions. We have researched
and developed our own products and built our expertise over time, this is
also what our clients actually see. We could have done certain things
maybe better or even faster, but we would not do acquisition just for the
sake of it. We have looked at a lot of other companies who have made wrong
moves, wrong acquisitions, spent a fortune, and have diluted a lot of
their stock. We think that for us to do an acquisition, the timing has to
be right and that acquisition must be backed; and we have yet to identify
a situation like that." CEOCFOinterviews
- How much new product do you
introduce each year? Mr.Stephens:
"Huge amounts. Since the world
of technology is changing so fast, we have striven to stay ahead of the
game by competing, and we have been able to compete on the worldwide
basis. Everything we have right now, literary has been produced or
re-written over the past two years to fit the web band. Virtually
everything we have now is brand new." CEOCFOinterviews
- Is the company working on some new
product that people should be looking for in the up coming year? Mr.Stephens:
"We are very excited about the
ASP product (Application Service Provider). This product will not be for
sale, customers will be renting it over a period of time. We well thus
have recurrent revenue. Their up front cost will be much lower, since they
are not buying it and we will provide the entire services, where we will
host it and charge them on a monthly basis. The cost for the customers
will be significantly lower, over a period of time than what they would
have normally have to spend, and they won't have neither the huge
investment nor the hardware. You do not need big and fancy equipment; you
can actually run it with reasonable common equipment that is readily
available at a sensible price. We expect to release our ASP product in the
middle of this year. The development is going on right now an it is in a
very exciting faze, because, by just talking to some of our existing
customers and potential new customers, even to the larger chains, we see
that they are all very thrilled about it moving from what they have now,
to the ASP type approach." CEOCFOinterviews
- Would the
ASP program be your biggest future revenue producer? Mr.Stephens:
"It will be our flagship. Due to
all of the communications being simple and of its capabilities to link up
and easily trans-feed and/or transfer data through the web, virtually
everything that we have developed in the last year or so on the web will
be readily available as an integral component of this flagship." CEOCFOinterviews
- How big is this market? Mr.Stephens: "The
market in North America is approximately 20 billion dollars. There are
about 150,000 optometrists and about 100,000 optometrists, which is a
large amount of users. In addition, we have a base of about 9 or 10
thousand users underneath them, of people who dispense contact lenses or
frames. You are
looking at a huge market in North America. In Europe there is double that
market." "The vision care market itself is an extremely wealthy
market. The prices they sell items at are sometimes a hundred, two hundred
even a thousand percent more than they had cost to make them. This is not
a declining market, because the aging population contributes to its
stability. There is an ongoing almost guaranteed ten percent growth. The most crucial thing for us in developing our products is
the ability to adapt them to other healthcare markets. We are now also
exploring the possibilities of moving from the vision market into other
markets in order to utilize our technology. We have developed products
that we can now take and move somewhere else without too many adaptations.
" CEOCFOinterviews
- Do you have any competition? Mr.Stephens:
"As in any market there is some competition. However, since we
have been ahead of the game in a great many ways, and will continue to do
so thanks to new developments in our company, the amount of our
competition is comparatively very small. They all have pieces of
something, but none of them has a total integrated solution. And that is a
fundamental difference." CEOCFOinterviews
- What market share do you believe you can capture? Mr.Stephens:
"We already have a base of approximately 12% of the North American
market. Our intention is to at least double that amount with products,
which we have developed in the last two years.
On a global basis, we would like to aim for about 10% of the entire
market, which is into the billions. For this we will need partners who are
large enough to be able to service that market. We look for partners who
have a strong marketing approach, and people with new ideas and new
concepts. When all of those aspects are put together, there is a real
possibility of success." CEOCFOinterviews
- Do you have the cash and/or credit to continue growing your company? Mr.Stephens:
"Up to now we have always funded our own work. Hence, two things
are quite apparent when people look at us. First, our stock is not
diluted. The total float is 15.6 million shares, out of which the public
float is only about 4 million.
Secondly, to this date, we are totally debt free. We think however,
that at this time, since the products are more or less developed, we need
to get them out. Therefore, we are currently seeking to raise
approximately 5-10 million dollars, to market these products
effectively." CEOCFOinterviews
- What is your burn rite? Mr.Stephens:
"We are trying to keep it no higher than the income coming in. We
are running a very tight ship. All of our key people work hard, and they
are giving there very best to make this work. We expect to contain that
burn rite to allow us to survive till the new programs kick off." CEOCFOinterviews
- Is the company cash positive? Mr.Stephens:
"Yes. We have been cash positive for about 15 years. In the last 2
years, since we went into a full-scale development program, and abandoned
our legacy-based systems.
However, we are getting right back to a cash positive role already.
All the time we were still spending only our own money. We were not going
out raising any money nor did we borrow any money." CEOCFOinterviews
Is there a final thought that you would like to share with current
shareholders and potential investors? Mr. Stephens: " We feel that it is very important to bear in mind that we have been profitable and will continue to be profitable. The entire product line has been redeveloped, and we have an existing base of people switching over to our new products, as well as the fact that we are now aiming at a new base of people. In addition to that, it is important to understand what this global approach can bring. It allows us rapid expansion. The partnerships will certainly help and this company is not being overvalued by any means. There is still plenty of room for us to grow, and we do not see a whole lot of fluctuations like some of the very large, highly overvalued companies. There is a good base of people, the float is tight, and, as the recent stock price increases and trading has shown, there are a lot of people now climbing on board."
|
