Finally. I got to see, hold, and use a PicoAir.  PicoAir and PicoPro are projectors that fit in your pocket, or at least mine. They, and the technology within them, have the potential to positively disrupt the electronic display industry. Academic and abstract discussions aside, there’s now a product to buy and hold, or in my case, to borrow for a few minutes. Peter, who is internationally followed (via his blog and tweets – dude, upload a profile photo, eh) for his tracking of the company that provides the enabling technology, MicroVision, is a fellow shareholder of MVIS. He was nice enough to drop by my office so we could look at the new technology, compare it to the old technology, celebrate the advance, and wonder why the stock hasn’t responded.

No product is a panacea. Yet some products dramatically change our electronic worlds. The innovation that was the iPhone may never be surpassed for its impact; and yet we said similar things about the personal computer, the microchip, and the transistor. Picoprojectors may not fit inside that camp, but if they don’t, they at least have the potential to live in that neighborhood. Take a look at almost any electronic device. Almost all of them have displays. Any display that is more sophisticated than monochrome text is an amazingly complex and delicate collection of microscopic circuitry and precise material processes. It is only through massive development efforts and the now common economy of scale that has brought the display prices down to the level of commodities. Regardless, displays that are now considered conventional (LCDs, LEDs, plasma, etc.) are amazing. They are also limited by power, size, manufacturing complexity, transportation and warehousing expenses, and ruggedness. As I’ve written before, imagine replacing displays that come wrapped in plastic, surrounded by plastic peanuts, stabilized by styrofoam, and boxed in cardboard – imagine replacing that with something that can be dropped in an envelope and mailed, and yet still produce images that are measured in feet.

The PicoAir is not a panacea. But it does show what is not only possible, but is actually for sale. It is a projector that is about the size of a smartphone. It displays an image that is always in focus and that expands in a cone one foot diagonally for every foot the projector is away from a wall. Stand two feet back, get a two foot image. Stand four feet back, get a four foot image. Stand ten feet back, and get a ten foot image, but one that gets progressively dimmer. Just like a flashlight, the farther the beam spreads, the dimmer the light. At one foot away from a wall, or seat back, or piece of cardboard, the image is larger than any pocket cell phone. Such a capability has been discussed, but it has yet to catch on with regular consumers – at least not with the previous products.

MicroVision produced one of those previous products. Five years ago I received my first generation picoprojector from MicroVision.

MicroVision’s first picoProjector, the size of an iPhone. The newest models are much smaller and brighter.

My ShowWX showed up via UPS (and almost didn’t), and was used for a few years until the novelty wore off. Actually, the utility wore off because the room I was using it in caught the sunset which outshone the projector. I found that I could only use it after the sun went down, and with Seattle’s late summer sunsets, that meant it wasn’t good for many hours of the day. The other limit was that the ShowWX required cabling, some way of being propped up, and had to be hooked up to a sound system or the movie would be silent.

The PicoAir is brighter, wireless, and includes speakers. I can’t afford one, but Peter did, or at least considered it a bit investment research. He brought it by my office. We set the two machines beside each other, and considered the advancements. Image brightness is up. Speckle is down. Heat is less of an issue. Usability is dramatically improved. Price is improved. This is all good. About the only downside was that each still needed to be propped on something unless the person using it has tireless arms.
The simplest review of the PicoAir’s operation was that it was so simple, seamless, and superior that we soon turned to talk about MVIS. With such an impressive product, why hadn’t MVIS moved?

Estimating a proper value for MVIS has become a moot analysis. If the current stock price was based on rational, conventional valuations they would only make sense if it is assumed that the company will never have a product, won’t grow, and yet will somehow survive. If it is going to grow, then near term valuations of $20 are easy to produce. If it is going to bankrupt, then near term valuations of $0.02 are easy to produce. Yet, for the last year, the stock has bounced around $2 and a market cap of less than $100,000,000. Good news hasn’t raised it. Bad news, or at least the lack of news, hasn’t dropped it. And yet, the company is making progress with an impressive potential 2015 pipeline.

Individual investors should know other individual investors; especially since 2008. Sit together and commiserate. Conventional wisdom has proven to be less than wise, and the investing environment has changed. We continue to invest because we believe in and have experienced the potential rewards, and yet, just like with the Three Guys Walk Into A Bar, we can watch the trades and see what appears to be stock manipulation. Small stocks have always been threatened by illegal trading. The sums involved in trading are so large relative to the size of small companies that prices become set more by trading than investing. Trading is not illegal. Trading to manipulate a stock’s price and profit from that action is illegal, at least as I understand it. We both commented on the fact that, for the last year, MVIS has traded within about $1.50 and $2.50. Those may seem like large swings based on stock price, but they are within the noise of movement within a market cap valuation that is potentially above a billion dollars.

We conduct our analyses. Research the companies by talking with management, visiting the company, attending the meetings, and buying the products. Okay, I did that years ago but can’t afford to now. Peter, however does all that and more. Then, finally, a catalytic moment, a significantly improved product is released, it is met with impressive reviews, the company tweeted “The initial demand for #PicoAir far exceeded our forecast.“, and yet the stock doesn’t move.

Two concepts come to mind: delusional investors, or coiled spring stock. Until the stock moves, MVIS shareholders have to deal with people who consider them delusional. If the stock never moves, then the detractors are right. If the technology, the company, and the stock finally reflect the positive disruption that is possible, then the longer the wait, the greater the release and the steeper the climb in the stock – or at least that is the hope.

I’ve listened to detractors before. They were right about Iridium. They were wrong about Starbucks, and America Online, and Pixar, and F5, and others. For the last few years, they’ve been right about my portfolio, including MVIS. None of us know the future. But, what I do know is that when his Peter’s PicoAir met my ShowWX it was obvious that impressive progress has been made, and that maybe a bit more patience will produce much greater rewards. I certainly hope so.