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Offshoring in Ukraine
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Sheriff
Admin
4063 posts
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 posted 8/11/2004 11:52:13 AM
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Вот мнение про одны "оффшорную" Украинскую компанию.
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Do NOT invest in this little company called Offshore Creations (OFSC.PK), that is a Ukrainian IT outsorcing firm. I just got a spam fax from unknown firm identified itself as "DTS marketing".
Offshore Creations spent $55,000 to send spam faxes about how great they are, and how they are positioned to explode, and how they have "strategic partnerships with Microsoft, Sun and Oracle", and how they have 100 developers in Ukraine....etc.etc.
It is all bullshit to get you buy their stock.
First off, to hire 100 developers in Ukraine, for an average of $300/month, only costs about $360,000/year - that is 3-6 average size IT projects. Second, I myself as a person have 2 such "strategic partnerships", with Microsoft and Sun - all it is is they are certified solutions provider, or even worse, someone on their staff took Microsoft Word exam....
There are 10,000 companies like that in the world, good luck picking a niddle in the pile of goo. Company like that is "positioned to explode" into oblivion if one or two key people get bored, gets sick or dies (and that happens often with business people in former Soviet Union).
Please DO research what you invest into.
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DayTrader
2 posts
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posted 8/30/2004 12:52:54 PM
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I received a message about this company as well, though I don't agree with your conclusions at all. The email message that I got shows the revenue for the company for last year as well as projected revenue for this year. Your numbers are way off. A bit of Google research shows that the company was an exhibitor at last year's COMDEX as well as the spring Gartner ITXpo and they are scheduled to participate at the TechXNY. Also, I found them on the list of participants at the Fall Gartner show and they are on a short list of companies conducting a presentation there.
I'm not saying that you should or shouldn't buy their stock, but I do think you've overstated your case.
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Sheriff
Admin
4063 posts
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posted 8/30/2004 1:38:18 PM
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K, it is not entirely my opinion, although I somewhat agree with it.
The fact that company participates in a Technology event does not change my decision to invest in the company either way. I've known a few 5-to-10 person companies that participate in these events regularly. In fact, right before 1999 dot com crash I've visited one of these events myself, and remember a few names that produced a nice "splash" a year later.
My point was that this company attempted to mislead potential investors into believing that it is something it is not - a potential industry leader. It did sent a spam advertising, that by the way it was structured makes people think that this company is on par with Microsofts and Infosys-es of the world. Things like that make me personally believe it is a pump-and-dump venture or a fly-by-night shop that doesn't care about its reputation. And I don't give my money to people like that.
JMHO
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TwoChips
1 posts
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posted 8/30/2004 6:27:00 PM
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I think you both have valid points. In general, microcap companies on the Pinksheets represent a high-risk, speculative investment. That's pretty much a given. However, the fact that their "investor relations campaign" involves fax blasts says very little about the company. I should know - I personally manage a lot of such campaigns. These campaigns are almost always executed by the investment banker that brought the company to the market, without any direct knowledge on the part of the management of the company. The management is told - we are going to be doing some stuff to raise awareness of the company and you don't want to know the details.
Sounds creepy, but here's the deal - the means by which microcap companies get the word out on the street about their stock is rather limited. Somehow they have to get their story out - be they a legit deal or a pump and dump.
But this company actually doesn't look much like the classic p&d at all. At least there is some substance here. Look at their website - plenty of clients to do reference checks on, plenty of projects to see that they have real experience, etc. For that matter, you can go and see them at the tradeshows. It's not like the standard scum that hide under rocks while they steal money.
Let's look at some numbers. So, the company claims that they have 100 or so employees. Billing rates for offshore services run about what? Let's guess $18/hour. That means that they should be able to produce around $300K per month. Not much, but a decent start. If they raise money for the purpose of expanding their capacity, utilization and marketing reach (too bad this spam I got doesn't say why they are raising money), then this could be an interesting play.
You know what I'd do if I wanted to know if these guys are for real or not? Wait. Just wait. If they are real, they will become full reporting. Then, watch for what they do when they have access to the piggy-bank (S8 shares). If they start churning out S8's like there's no tomorrow, then forget it - they're a scam. But if they don't. If they show contracts coming in, revenue going up, capacity increasing, utilization high and products hitting the market - this could be a good deal.
In short - I have seen a lot of P&D's. Most, if not all, are empty shells - little or no revenue and no real hope of ever showing a profit. These guys don't look anything like that. But let's wait and see what comes 3 months from now.
At the very least, this is the type of company that I can jump into and back out of and turn a couple bucks.
[Message edited by TwoChips on 8/30/2004 6:29:58 PM]
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DayTrader
2 posts
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posted 8/30/2004 6:43:45 PM
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To be fair, there is a big difference between attending COMDEX or CeBIT and attending the Gartner ITXpo. These guys were at the Spring Gartner and the Gartner site shows that they are listed to be at the Fall show with a "Vendor Solution Presentation". I don't know what that is, actually, but the list of companies that are also doing one of these presentations isn't too flighty: http://66.102.9.104/search?q=cache:lsLgUGjpsPsJ:www.gartner.com/2_events/symposium/2004/docs/sym14/sym14.pdf+gartner+itxpo+fall+vsp+list+2004&hl=en (search by "offshore creations"
I guess I should agree with TwoChips, however, and cool my jets until we see if these guys actually produce results. Sheriff and TwoChip, thanks for causing me to think twice. If I do buy in, I'll tell you how I make out.
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Sheriff
Admin
4063 posts
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posted 8/30/2004 7:27:18 PM
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Dear DayTrader-TwoChips dude,
If you are trying to steer a real discussion here, at least do us a liberty of assuming we are not technologically challenged, and do not post under different names from the same IP address in Kiev, Ukraine.
Posting under different names and answering your own questions is against our RusUsa.com Terms of Service. Here's a few rules, this thread is in Russian, but I am sure you'll be able to find someone in Kiev who can translate this: http://www.rususa.com/forum/message.asp?msgid=154
I am just qurious, how far the "push" will go, or are you ready to come out and openly discuss strengthes and weaknesses of your company and offshoring as whole.
Look forward to real discussion.
Sheriff
[Message edited by Sheriff on 8/30/2004 7:31:56 PM]
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