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Some notes from the May 27 2020 CC
#1
Some pointers of this very bullish CC:
  • Introducing a CEO with a ton of experience and contacts.
  • It's amazing that a company as little as Intrusion was able to get such a top-notch CEO.
  • It's even more amazing hearing him talk about the open-ended upside of the new product called Shield, which he called a must have, selling itself and facing "the most unlimited market I have ever serviced by far."
  • Introducing a new product (not yet formally, as they are still writing the patent applications)
  • The product will block incoming dodgy traffic and also prevent it from spreading laterally within an organization's network.
  • The new product is based on their existing products TraceCop and Savant and automates these with the help of AI so that it becomes a real-time threat protection that isn't signature based, like most of the competition.
  • Signature based is basically a list, the new product AI leverages the company's experience with identifying dodgy behavior and automates it (with TraceCop, company people go over queries with their customers to identify threats after the fact, which is slow, labor intensive and doesn't prevent threats from coming in and propagating within the organization's network. 
  • Cybercrimes today are mostly written and operated by AI, that is, every time they come at you they are slightly different, a signature based approach is not cutting it, which is why you see so many security breaches despite the billions spend on cybersecurity products. 
  • TraceCop was previously sold almost entirely just to the DoD
  • The new CEO has worked in the Ministry of Agriculture implementing a cybersecurity project, he still has ample contacts there so he could instantly expand the market already for their existing products beyond the DoD
  • But the main market for the new product is commercial, working through 18K channel partners which the CEO (in his previous jobs) helped create and has ample contacts and experience with and distributors like Ingram Micro (he already has an appointment in a couple of weeks). 
  • The commercial market is as good as new (almost all their sales are just to DoD), and much larger for Intrusion
  • The product is SaaS based, in the order of $20 per seat per month + appliance, a turnkey solution.
  • Installation is a simple add-on to the company's network.
  • The share price crashed 10%, we believe some investors were disappointed the company isn't putting itself up for sale or partnering with a big company.
  • We also believe these selling investors have missed the point, and will look up in wonder what they have done in a year or so..
Comments, additions, suggestions, questions welcome.. one can join following the instructions here.
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#2
Some useful stuff:
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#3
The new product Shield also protects companies from employees visiting (or, in this case, trying to visit) sites that detract from their productivity (social media, YouTube, porn, etc.) which wastes an enormous amount of employee time, as it happens.. From the new website:

Executive Alert
Employee lost productivity by cyber is costing
you potentially millions of dollars a month!
  • 30% of all Internet traffic is porn
  • Visits per month:
    • Netflix 46M, Amazon 110M, Twitter 160M, PORN 450M, Youtube 800M
    • All of these represent employee brain drain

  • Porn sites receive more regular traffic than Netflix, Amazon, & Twitter combined each month 
  • 800 billion minutes spent in Facebook every month
  • 70% of Internet porn is downloaded during the workday
  • Statistics show this is somewhere between $1M and $3M per year in lost productivity for a company with only 100 employees!
  • Add to this the costs to your business from gambling, phishing fraud, spam, malware, and ad fraud and you add millions more dollars lost
  • Is this how you want your employees spending their time at work?
  • Shield can stop all of this lost productivity immediately
  • Easy way to check your losses is to take 10-30% of your total labor costs and realize you are wasting that money on the misuse of the work Internet!
  • Shield which cost you only a few thousand dollars depending on the size of your business will save you millions of dollars in lost employee productive and potentially millions of dollars in cyber crime losses!
  • You may think you are protected today but install Savant and you will find out just how unprotected you really are.
  • Can you afford another minute without Shield on your side?
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#4
The new product, Shield:
  • It's in addition of their existing business, no risk to the latter.
  • Opens up the vast commercial market for the company where they previously had no presence, hugely increasing the TAM.
  • Their existing products are labor intensive to install and operate, the company simply did not have the manpower to try to sell them n the commercial market.
  • But Shield is a simple add-on to a company's website, installation is simple, as is operation. The company can do this through resellers and distributors.
  • It operates on a SaaS business, producing easy reliable recurring revenues..
What's not to like?
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#5
Is Shield too good to be true?
  • Even if it is, it's an addition to their existing business with the DoD, so even if it flops, that business is tried and tested and will stand.
  • Unlikely a guy like Jack Blount would become CEO just to scam people.
  • Even if Shield doesn't take off, the rolodex of Blount will likely give a boost to their existing business beyond DoD to other government departments (like Dept. of Agriculture where he ran a cybersecurity project).
  • Both their existing products, TraceCop and Savant are tried and tested, and Shield is based on them.
  • It's not terribly difficult to imagine: TraceCop has the databases with the bad actors, Savant does real-time traffic analysis, combine the two and make them rule based with the help of AI and you have Shield.
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#6
My key points of interest from the CC. 

KEY POINT 1 at the time of 49:51 into the call a Question was asked from Ross Taylor, a private Investor since 2015 about the Direct to market approach for Intrusion Shield.
C.E.O. Jack Blount confirms Intrusion Shield will largely sell itself. You can purchase it,install it,as a C.E.O. of a company without any knowledge or technical expertise, and it can start making you safe instantly.You can get a report at the end of the day,or end of the week, or end of the month that tells you it's making you safe. Jack Blount says it is the only product he knows of that actually tells you everyday what it just protected you from, it is extremely unique in the fact that it will sell itself.

KEY POINT 2 at the time of 55:50 into the Call a Question was asked from Ross Taylor " Why did you choose to not pick a partner that could bring you to market more rapidily. "
( It was C.E. O. Jack Blounts response that really stood out for me and what will make me add more INTZ on any dip below $4.15 for the remainder of the year. ) C.E.O. Jack Blount says he did a partnership at one of his sartups with IBM, IBM sold 300 million dollars of that product in 12 months after signing a contract that took him 14 months to negotiate.And,he is confident if he wanted to negotiate a contract for Intrusion Shield with IBM it would probably take him 14 to 18 months and thinks the first year they would probably sell 500 million dollars but he believes Intrision Shield is that unique and that valueable that he wants to keep full ownership of it.

The above 2 points are just the icing on the cake that makes me confident that INTZ is a good solid long term investment.
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#7
Hello ABFX, welcome aboard, and yes, I agree these are interesting points. We don't yet know how well Shield performs, but it's based on TraceCop and Savant. Simplistically one could say it is automating this and as such, turning them from forensic tools to real-time protection device.
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#8
From the May 27 2020 CC:

Quote:Thanks, Mike. As you all know, our company has core strengths in large data sets and security expertise. This call is about how to take these forward toward maximizing shareholder value. The new security product is proceeding well toward being ready to announce. Note with all of our excitement on the novel new product news, this does not signal a shift away from our base. It's a key to our strength.

I've been writing patents for the last several weeksThere are a lot of new capabilities in the product that are novel and amazing. Most of the major parts of the products are implemented and functional already. This product is emerging at the perfect time and actually solve some unsolvable security problems.
  • So technically, Shield, the new product isn't yet officially introduced.
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#9
Blount (the new CEO) has worked at USDA (US Department of Agriculture), he could use those contacts to get a second foothold in government after the DoD where almost all Intrusion's revenues come from, from the May 27 CC:

Quote:I worked at the government in an agency called the United States Department of Agriculture, which is the most misunderstood department in government. So I have to mention it just for a minute because when I got there, I really wondered why it was there. I thought about farmers, and I thought about red meat, which I eat a lot of, but I didn't know why they needed an IT expert or why they have been hacked for $300 million. Quickly found out after I got my security clearance in less than 12 hours, by the way, to top-level security that USDA does a lot more than most people think. So I'll just educate you for your own benefit as a citizen.

They actually run the 10th largest bank in the United States for the federal government. They run the 12th largest health care system in the United States for the federal government. And lo and behold, they actually do payroll for every federal employee.
  • Now you also understand why it is a fertile market, both for hackers as well as for Intrusion.
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