Infocast Message from the President
To Fellow Shareholders, Prospective Investors and Friends of InfoCast:
Just over four weeks ago, I joined InfoCast as President and CEO. Since then, I have had the opportunity to visit each of our
operations and review the progress of our product development. In this letter, what I expect to be the first in a series of
unscheduled communications to you, I will review our development thus far, and preview some of our growth plans.
Our preference is to send these letters via e-mail. Thus, I ask that if you are receiving this letter in hard copy via fax or ?snail
mail?, please provide us your e-mail address by e-mailing Cliff Jones at ?cjones@infocast-corp.com? (or by telephone ?
1-877-338-8889). In that way you are assured of receiving all company news on a timely basis.
This letter is longer than normal, as I will try to provide the context for future communiqu‚s. I encourage you to read this
letter in its entirety ? by the end, I am sure you will share my excitement for the future of InfoCast.
About Me
For those who do not know me, I am 52-years old and have spent my entire career building smaller businesses into
successful public companies. ?Success? to me has always been measured by growth in shareholder value. And the path to
success has been the same each time - build the business right from the ground up by:
(i)focusing on a great market opportunity;
(ii) assembling a team of people dedicated to win that market; and
(iii) serving customers in a way that differentiates us from our competitors.
OUR MARKET OPPORTUNITY
InfoCast is in a brand new high growth industry sector termed ?Application Service Provider? or ?ASP?. In simple terms, an
ASP hosts complex software programs that businesses can access and pay for on a ?per use? basis. This reduces the
requirement for that business to own expensive computer hardware/software and maintain a large staff of computer experts.
This industry is based on the premise that eventually computer systems will resemble telephone systems, with a relatively
inexpensive device on the desk, connected to a complex network that houses the real computing power ? and as with our
telephone, we will pay only as we use it. This evolutionary change in the way computers are used is the strongest trend in the
industry today ? Forrester Research predicts that the ASP market will reach $21 billion by the year 2002.
InfoCast?s business is based on that trend. However, we are focussed only on those applications where we can bring
maximum value through proprietary technology. Let me give you one example: we will make it possible for an enterprise to
recruit, train and have employees available at any time, and from any location, who can respond to customer telephone or
e-mail questions. The traditional way of providing such customer support has been to assemble enough people into a ?call
center? where they would work in cubicles and on a structured shift basis. There are only a fixed number of seats in these
traditional ?brick and mortar? call centers and we have all experienced the frustration of being put on hold, forever, ?until the
next available customer service representative can take your call?!!
But InfoCast is changing that. We are making it possible for the enterprise to distribute customer calls to the right person,
wherever they are located, whose computer will show relevant customer history, and where the answers to their questions are
to be found. The person who handles the call will probably be working out of their home and will be assigned specific calls,
as they are available and needed. The enterprise benefits by paying for highly trained people only when they provide real
service and not just because they are sitting in a call center facility during a structured shift that may include hours of nominal
use. In fact, the enterprise does not even need to have a ?call center? building!
That is not a simple task to accomplish. There are three major components to it:
1) The services necessary to train and supervise the customer service representatives, provide them the information they need
to answer the customers? questions, and generally allow them to maximize the computer without having to be a computer
specialist.
2) The massive computing capacity essential to making the system work - storing the necessary information, managing it and
making it easily accessible.
3) The network that ties the individuals to the computers and, through the Internet or a private network, to other people in the
enterprise and, ultimately, to the world.
InfoCast?s Virtual Call Center solution incorporates all three components. With the assistance of our technology partners, we
will provide the architecture of the system, we will monitor and manage it, and in many instances we will provide essential
proprietary technology. For example, when we serve enterprises needing a call center, this is what is involved:
1) We will provide training, via the Internet, for the ?at home? customer service representative, or cyberagent. We have an
exclusive license for call center agent training with ITC Learning Corp., a Nasdaq company (ITCC) specializing in CD-ROM
based training, as well as a joint venture with Call Center Learning Systems, a leader in instructor led call center training.
On-line versions of these and other traditional courseware will be housed on our proprietary Digital Exchange Library (DXL)
and the agents? learning process will be managed by our proprietary Learning Management System (LMS) which tracks the
students? progress through the courses.
2) To achieve the computing power to support this, and our other e-business solutions, we will be installing a series of
Information Hubs or ?i-Hubs?. The centerpiece of our first i-Hub is a Sun Microsystems Enterprise 10000 ?Starfire?, which
is a secure, reliable server that can be scaled to serve our ultimately global vision. Working with Sun as a partner under its
ServiceProvider.Com program, we expect that the first i-Hub will be commissioned before yearend. For the Virtual Call
Center, the i-Hub will house our proprietary skills-based routing software as well as our ?Voice over IP? technology that
allows the cyberagent to communicate with the customer over a dedicated data network just as if they were using a
telephone.
3) And, for the network, we are working with AT&T Canada. In this instance, AT&T Canada will provide the network to
transmit the data, including voice data, to and from the i-Hubs. In the case of our Virtual Call Center, the network will
ultimately allow the customer to click a button at the enterprise?s Web site to ask for help; the request will go through the
Internet (a data system) to the trained customer service representative who will receive it, sitting at their home in front of their
computer. The computer will provide a ?screen pop? of the caller?s history and other relevant information so that the customer
can be helped as efficiently as possible. As we work with this network, we are not only making it work for the technology
that exists today, but we envision the day when the person in the ?virtual call center? responds on screen, in video, rather than
as a detached voice on the phone.
I have spent a lot of time describing our Virtual Call Center which is the first solution we will be offering; we plan to follow up
immediately with similar systems for teleworkers who can perform tasks from home but be accessible to co-workers as if
they were down the hall. We are also currently working in the areas of: distance learning, hosting software solutions sold by
third parties and other business-to-business e-commerce solutions. These represent areas where we can provide our template
of providing services for the people involved, providing the i-Hub, and connecting it all with the network. In this way, we
believe we are pursuing an unlimited market opportunity in a highly focused and efficient way.
As we grow, we will continue to create our own solutions and technologies in-house and, when necessary and prudent, we
will acquire the additional resources we need. Accordingly, we expect to obtain growth both organically and through
acquisitions.
Clearly, we believe our opportunity is very large. Our goal is not to become an ?interesting company.? Our goal is to become
a major player in the emerging ASP industry and there is no reason why we cannot achieve our vision of being a leader.
However, we have a significant amount of work to do to achieve that vision, ultimately reflected by a highly profitable P&L.
But in the near and short term, we must keep our focus on realizing certain specific operating benchmarks, such as:
Complete development and launch solutions for Virtual Call Centers and Telework
Acquire rights to particular software or establish partnerships to enhance our core offerings
Commission our first i-Hub and develop our North American i-Hub roll-out strategy
Develop a strategy for global expansion
Bring on customers who wish to offer their unique software through an ASP model.
INFOCAST PEOPLE
We have not progressed to this point magically. It has been the result of the technologies, resources and, most importantly,
the vision of an exceptionally talented group of people, including: Tom Griffis, Co-Chairman, who arranged the seed capital
and acted as sponsor in our early days; Darcy Galvon, who had the i-Hub vision; Mike Sheehan, with over 35 years
experience in Call Center operations around the world; Sandy Walsh, Chief Technology Officer, who has transformed raw
technology into products; Wayne Bester, Chief Information Officer, who brought years of IT operating experience from
Amoco Canada and Dr?s Ken Smith (Chief Learning Officer), Ed Turner and Lyn Bartlett, well known in their field of
Distance Learning.
As we grow, we will need to build additional depth in a variety of areas. Accordingly, in the near term, we will be adding to
our management team:
Chief Financial Officer - I am currently recruiting an experienced high technology CFO
Marketing Director - it will be important to establish the InfoCast brand in this new market
Organize the company into business units with senior executives to head up each area, each having top to bottom P&L
responsibility.
OUR DIFFERENTIATORS
Unlike many other ASPs, our immediate approach is to assemble solutions for such ?horizontal? needs such as call centers
and telework, and then market them to any number of ?vertical? markets. We believe this allows us to work in a very
focused way while exploiting a massive market.
This approach is different than most other ASPs which are offering less proprietary hosting solutions, targeted at customers by
size (serving, for example, Fortune 500 companies, or specific verticals). Our approach is solution driven (e.g., we answer
the enterprise?s need to provide a high quality call center). And our core template is to provide services for the people
involved, the i-Hub, and the network. We believe this approach and this template will resonate with a large universe of
customers, but will allow us to be organized and expand in an efficient but exponential way.
We will continually need to establish differentiators. Accordingly, our near and short term priorities are:
Continue to enhance and differentiate our solution offerings by acquiring rights to software that augments current
product offerings
Establish relationships with ?best of breed? suppliers to operate and maintain the i-Hub network
Acquire proprietary solutions that will allow Infocast to apply its template to dominate a new vertical market
CAPITALIZATION
To be a winner, we will not only have to provide the right services and manage our operations and growth well, we will need
to move fast ? in Internet time. This will require additional capital. Accordingly, our near and short term priorities are:
Complete the current $13 million private placement
Establish a relationship with a large Wall Street firm and set the groundwork for a larger equity financing in the next 6
months.
SHAREHOLDER VALUE
As I noted at the beginning of this letter, our success will ultimately be defined by our ability to increase the value of InfoCast
to its investors. Growth as reflected in our personnel, our customer base, our infrastructure, our balance sheet, and our P&L
statement will all be vital in building shareholder value. But there are other necessary goals we have in the near term, among
them:
Improve the liquidity in our shares by listing on one or more major stock exchanges
Paying attention to our Investor Relations activities ? frequent shareholder communications, attending investor
conferences, etc.
Establishing coverage amongst financial and industry analysts.
Of course, the most important thing we can do in this regard is to create realistic expectations and achieve them!
IN SUMMARY
I trust that I have succeeded in providing you with a sense of our dramatic opportunity and our plans to pursue that
opportunity as quickly and aggressively as possible. I also hope you now see why I am so personally excited about the future
of InfoCast.
As I, and all the others who comprise InfoCast, work on your behalf, we will continue to keep you informed of our progress.
Our investors, especially at this stage of our progress, are ? in many ways -- our partners. We share the same goals. I can
assure you that we are working on all fronts to build the company and its value.
Sincerely,
Jim Leech October 8, 1999
President and Chief Executive Officer |
