I'm puzzled as how CUST having enough talents to develop the super-duper i-payment system. As of Feb. 99, they have only 15 employees, I'm assuming including CEO and the janitor. They contracted out the development process to Lante Corp, at around the same time. A search for this Lante Corp. reveals that this is a consulting firm specialized in developing e-commerce biz. While Lante sounds like a respectable company, it can't be a substitute for in-house R&D, it's not even in the R&D business ! It's in the marketing business. I guess this means that we'll see a new and improved web page for CUST, but I don't think there will be a lot more substance than that.
For the sake of argument, let's say that Lante can develop this solution. Does the longs realize how many things can go wrong in this arrangement ? If Lante can do, why shouldn't Lante sell it if it's so profitable ? After Lante deliver the code, who will support it ? This is too many question for this simple man.
BTW, here's what I based the above comments on, from CUST 10K
" Lack of Standards. There are currently no generally accepted standards for
Internet payment systems. There is no assurance that the Internet transaction
payment system the Company is developing will become a generally accepted
standard or that it will be compatible with any standards that become
generally accepted.
Employees
The Company had 15 employees as of February 28, 1999.
Research and Development; Patents and Trademarks
The Company is a licensee of one patent covering concepts the Company may employ in implementing its Internet businesses. In addition, the Company has filed for trademarks and service marks, as applicable, for "CustomTracks" and other marks.
The Company entered into an agreement in February 1999 with Lante
Corporation ("Lante"), a third party software development firm, to assist the
Company with developing its new Internet transaction payment system. In
exchange for the services to be provided by Lante, the Company will pay cash
for work performed at discounted rates and will issue options to purchase
500,000 shares of the Company's common stock to Lante at an exercise price of
$7.62 per share, the closing price of the Company's common stock on the date
of the agreement. The options vest over three years and expire at the end of
ten years. The estimated fair value of these options at the grant date using
the Black-Scholes option valuation model is $2,865,000 or $5.73 per share."
cheers,
tt |
