Hey Matt,
Thanks for checking in.
First of all, I know you guys are going hard at it, and that's all cool. You are an entrepreneur, and I respect that. You are smart and you hustle. You have done a lot of deals, and you know your business. I think you will end up regretting not being a registrar, because your domain escrow business model is structurally flawed. I don't know much about your core freelancer business but I applaud anyone who empowers the little guy to get paid selling their time and talent. As such, I hope you guys continue and power through.
As for the Epik financials shared with you, it was actually shared in confidence. Even without an NDA, it is a well-known
decorum to treat such data in confidence. The fact that you would share sensitive information, is perhaps indicative of your ethics. By my book, that would not ever pass the "
Do unto others" test. I encourage you to use that test as a simple gut-test regardless of any guiding faith or spiritual practice. Even at age 45, you are old enough to know better.
As for Epik's fiscal strength, Epik is closely held. We have a recurring revenue model that is gaining momentum. As you well know, we invest very heavily in product development. The attached company overview outlines some of the various projects that we are working on beyond the Epik platform including registrar, hosting, domain marketplace, etc. These are mature products.
Worth noting we did also complete 2 acquisitions so far in 2019 --
BitMitigate.com and
Sibyl Systems. This in turn allowed us to introduce new products like
Anonymize VPN and
Resilient Domains as well as incubate new projects like
Us.Tv,
WatchMask.com and
Armored.net, all developed in the last few months.
As for our cash, as you saw, we put it to work. We fund development. We buy companies. In case you missed, it we also do interest-free domain loans -- we have hundreds of thousands of dollars loaned out at any given time to people who were at risk of losing their domains due to liquidity issues. We just did a loan a few hours ago, in fact and get loan inquiries daily. We also have significant sums on deposit with domain registries like Verisign that require pre-payment. We also do domain promos, like our recent
$0.99 .CO promo at material loss but which yielded more than 30,000 .CO registrations so far in July.
As for domains, we
own about 9,000 development-grade domains on our own accounts. Per GAAP, we keep those on the books at lower of cost or market -- which is about $4.78 million. For calibration, the appraised value of the domain portfolio alone is more than the shareholder equity of your entire company and that is even allowing for your $26.4 million in intangibles (my goodness) that your auditors probably would like you to write down but doing so would make it even harder to get a follow-on offering done.
As a seasoned entrepreneur, you know that it is always possible to do a capital call. I could do one at anytime, and our Board and investors know it. Our largest liability is deferred salary to me, the CEO and controlling shareholder. This might sound crazy but I actually pay myself last. I am sure you are worth every bit of the $569K salary you pay yourself but I prefer to hand out a few more domain loans, or do some development, or aggressive promo than pay myself a wage.
Show attachment 124540
With all due respect, I actually don't doubt you work your ass off which is actually why I had the humility to reach out and explore a strategic cooperation. I enjoyed our phone conversation. I liked the geographic diversity of your location and I saw some obvious synergy in a market that is evolving. However, based on your remarks here in this thread, I conclude that a cooperation is not interesting, and that is fine.
Regards
Rob Monster
Founder and CEO
Epik Holdings Inc.
funds held in separate escrow account 
