Site icon The Contrarian Investor Podcast

The Future of Technology Investing is Hardware, not Software (Szn 5, Ep. 4)

editors

With Robert Cote, Cote Capital

Robert Cote, principal at Cote Capital Management, joins the podcast to discuss his model of technology investing, how it’s different than venture capital, and which areas of new technology that he is most excited about.

Content Highlights

More on Robert Cote

Transcript

Nathaniel E. Baker 0:35
Robert Cote, of Cote Capital. And we are going to talk about investing in technology. And according to Robert here, the whole idea of investing in technology is broken. Not irreparably broken, but broken. And we are, according to Robert, if faced with a new paradigm, when it comes to technology investing, which wait for it is a little bit like the old one. Not the most recent one, but the one that came before it. Anyway, I’ll let you explain. Go ahead. Robert, why is technology broken?

Robert Cote 1:17
I wouldn’t say technology is broken, I would say it’s the way we invest in technology?

Nathaniel E. Baker 1:22
Right

Robert Cote 1:22
The American empire, as I like to call it is built on an industrial base where we make real products that are better than what’s available anywhere else in the world, and then spreading the use of those products. And these are products based on breakthrough innovations. And by spreading their use, we’re not only creating more value for America and its citizens, but we’re creating value for the world. So it’s a wonderful way to build an empire, the old way of building an empire was you took other people’s land and resources. And through that wealth, you became an empire, we actually have become an empire by innovating and sharing those innovations around the world. And it all started in manufacturing and building an industrial base where we build real products. In the past 20 years, though, since the.com, bust, what we’ve experienced is a shift away from physical reality into digital reality from hardware into software. And that’s largely because the internet presented an opportunity and software presented an opportunity to digitize the world to take many companies and put them online, and then to automate much of what was happening in brick and mortar ways, in manual ways in a piece of software that would make us more productive, and create more value in the economy. Of course, that’s how we grew the economy. for about 20 years, there is now a shift back to hardware companies from software companies. And the problem we face today is that it’s very, very difficult to get the financial industry to move from software back over to hardware. And that’s because when you build your funds, it’s definitely a 10 year fund. And those funds are built, you invest in software companies, you develop a track record. And when you go to raise the next fund, people want to know what have you done for me lately? What is your track record, so it’s very hard to shift gears from a software based investment style, using equity over to a hardware based investment style. And So therein lies kind of the challenge that Cote Capital was created to solve, or using a model, I call it the IP capital investment model. It’s a it’s a way of of looking at investing in companies based on the engine in the car, not just the team driving the car, or the individual driving the car. So I’m an IP investor, I focused on that asset in making my investment versus an equity investor who’s focused primarily on the team driving the car. And when you move from software back over to hardware, you need to pay attention to the engine in the car, because that has a lot of value. And it changes the way you invest. And it allows you to bring many, many more people in this country in to the game of investing in the kinds of companies, hardware companies, companies making real physical products that will change the course of our nation. And I’ll say a couple of things about that. And and the reason that the game has changed is that asset takes many years to develop something new. That’s breakthrough, a lot of science and engineering 510 years, high barriers to entry very difficult for competitors. Unlike in software, where many competitors can emerge. Even if you pick the leader upfront downstream on you got to liquidate the competition that can emerge so quickly because of the low barriers to entry and software can stand in the way of delivering the kinds of returns your investors expect when you move over to hardware and yonder and how to value that, which is my skill set, and how to invest in that IP asset, which is not just ideas, it’s all the physical things that allow you to make that product based on your innovations. We hold that as security, just like in real property investing. And now you have an asset to protect you. And then instead of owning equity, and taking away ownership or a large chunk of the ownership of these companies, we’re actually taking a revenue share, I like to call it an IP royalty, we’re sharing in revenues, so we don’t dilute your ownership. And we’re able to generate cash flows from the use of that asset that we’re helping to scale and commercialize. So now investors have an asset back cash flowing investment to help many, many more of these hardware companies that are going to bring back the good old days bring back to the industrial base. And if we want to bring it home, the old stuffs not coming back. If we want to bring it home, we have to invest in this new generation of companies based on breakthrough innovations that are building real physical products.

Nathaniel E. Baker 6:09
Okay. All right. That’s about a bunch for us to unpack there. Let’s leave the investment part for a little later. But for starters, here, I’m curious why you say software is dead. I mean, you didn’t say dead. But why is it not as investable as hardware? In your opinion?

Robert Cote 6:23
Well, software is not dead. But that’s where everybody is focused, right? When right when the trend is back to hardware. And by the way, without good hardware, there’s no need for software to be cute about it. The reality is, is we tend to focus where we spend our time where we have our track record. And so while software will continue to be an investable asset class, it’s, it’s a crowded field, with many venture capitalists chasing very few do good deals. And there’s a lot of competition that emerges as a consequence of both too many people trying to find too many of these companies, as well as it’s easy to replicate a piece of software. And so software is still an investable asset class. But what’s missing in the market today is a financing solution to grow this new generation of hardware companies that are building things in new and different ways that will carry us into the future.

Nathaniel E. Baker 7:21
Okay, you talk to me about some of these things, some of these hardware, some of these ways that new innovative hardware is creating solutions.

Robert Cote 7:30
So I’ll give you maybe a couple of examples. First, I’ll start maybe more abstractly, and I’ll say that much of the world is demanding a shift to sustainable manufacturing, which means I use fewer natural resources, it’s an efficiency play, right? Anything that’s more efficient, is also more profitable. And I can deliver more value to my customers so I can grow my business. So high growth, high profit in shifting to thinking about technologies that allow me to build that product more sustainably, as well as reuse its waste, circular. And that’s just two words for how do we make it more efficient, not only for the environment, but to grow a business that is high growth and high profit. And so we’re focused in that domain. And to use an example, let’s take one of our companies that has developed a I call it a grain of sand, it’s called nanocarbon. And it’s literally 1,000,000,000th of an inch 1,000,000,000th of an inch. And you can actually manufacture this little grain of sand and control its geometry and its electoral optical properties. And you can now put it in a clear coating, put that coating on the window. With billions of these grains of sand in the coating, you can’t see the coating on the window, you can’t see the grains of sand in the coating, you just see the window you’re used to seeing. But now you have a window that is a solar panel that doesn’t look ugly on the roof. In fact, you don’t even know it’s there. You can coat the whole building and turn it into a solar panel and convert the light in each one of those little grains of sand. And again, there are billions of them into electricity and supplement in in great quantities, the energy needs of that building or sell that energy back to the power company in your community.

Nathaniel E. Baker 9:34
Hmm, so we’re talking about pretty dramatic improvements here in solar technology. And so this is something that you’re that you’re actively involved in. And they were it sounds like you’ve already made at least one investment.

Robert Cote 9:45
Correct. And so that’s one example. Another example would be a company that’s now come up with a way to make the glass that goes in every building at attend to a quarter of what it costs today to make that glass coated, whether it’s with this solar coating, or what’s most popular today is called a low E coating, it’s just a way to reflect the hot out, right. And so, it today, that low E coating, can now be made with another technology, it’s called a CVD coating system at a quarter, we even as low as 10%, or a 10th, of what it costs today, allowing us to solve the housing crisis around the world, because much of what stands in the way is the ability to buy that glass. So now, that’s another example of how industrial technology that you wouldn’t think about that isn’t the next great social media company, or the next great software company is actually doing things that not only build a business, that’s higher profit and higher growth, we’re talking 50% 60% profit margins, the old stuff that’s not coming back lives in the five single digit margin land. And that’s why it’s a race to bottom. And that’s why we moved our manufacturing offshore for the lower cost labor to be able to keep that business afloat. But if we want to rebuild our industrial base, we want to invest in these companies that are changing the game and how we make things to make it more sustainable, more circular, and not only will we be rebuilding our manufacturing base, we will be scaling as an IP investor, we scale the use of the engine in the car globally, so we can have an impact for humanity, and an impact for the people around the world. And do, again, to your point earlier, what America did from the start, build an industrial based on innovation, that you can’t get anywhere else and scale it around the world and build the empire based on delivering value to people not taking their land and resources.

Nathaniel E. Baker 11:57
Wow, that’s okay. And so in these companies that you mentioned, this technology does not exist as an investable asset in the public markets yet, is that correct?

Robert Cote 12:08
It’s not in public markets, but where it is, is in private companies. So we’re talking about young companies that venture capital would invest in, but they moved away from these hardware companies. And they’ve been spending 20 years investing in software companies, that would be private companies that I’m making available, based on years of doing this style of IP investing for companies 20 years, and a track record in that we can talk about in your next segment. But I’m taking this and opening it up to the people credited investors to start and the masses beyond that. Because if we want to bring change in this country, we have to get the people involved. They hold a normal wealth, to bring the change that we all know we want to bring in this country, talk to anybody we know we need to bring manufacturing home, it’s not only good for our people and for jobs, it’s a national security threat to leave it on the other side of the pond. Yeah,

Nathaniel E. Baker 13:13
I know, you mentioned that these are these these companies already. They have tangible assets, and they already produce cash flows. It’s not just some pie in the sky, PowerPoint type of things

Robert Cote 13:24
not an idea. And some of these companies are entering markets, they have early revenue, they have a pipeline of customers, because they deliver a value proposition nobody else can, can deliver. Yeah. And so as a consequence, they need an enormous amount of capital, a large amount of capital 30 to $50 million or more, because they’re not a software company where you hit a button on a computer and you make a copy, they’ve got to build real equipment to make that game changing product. And so the capital need is pretty expensive. If you take it in return for equity in your company, because you’ve got 345 $10 million worth of revenue, you’ve got a $50 or $100 million valuation, you’ve already given away much of your company, because it takes five or 10 years when you’re doing something groundbreaking. To make it to market, you’ve given a lot of the equity away to strategic investors. And now you’ve entered the market, you’ve got the customer pipeline, you’ve got some pre sales, you’ve got the revenues. And but the revenues are still early, right so that valuation is not going to be high enough. Right to minimize the dilution. So if I’m worth $50 million or $100 million as a company, but I need $50 million, I’m giving away 3040 50% Or more of my company on top of already giving away a good chunk of it. So I’m left with very little in the end, but that’s when the real impact can start. So we want to make sure that we’re this different style of company that really is IP centric and IP Heavy that has value in that asset. And in the equipment to make a product with that IP, we want to make sure these companies are incentivized to do the hard work, we need to move to the model I’ve been using very successfully for two decades. And that’s a model that moves into revenue sharing, it’s often used in making new movies, new drugs, building a bridge erode a tunnel, right? Everybody contributes to the building of that infrastructure. And they get a toll on revenue or a share on revenue, or an IP royalty. And this way, we don’t dilute the ownership of the company at a time when it matters most, which is when they’re actually in the market, and they can have that impact.

Nathaniel E. Baker 15:41
So but these wouldn’t be brand new companies, then this would be something a little more mature. That’s probably been around for a couple of years, if not more?

Robert Cote 15:47
These companies have all been around for at least five to 10 years, okay?

Nathaniel E. Baker 15:51
Okay

Robert Cote 15:51
how long it takes when you’re investing in something that is breakthrough, it’s a lot of science and engineering to figure out what the solution is. And then a lot of innovating, actually, to implement that idea, that set of solutions or that solution into physical products, proprietary manufacturing equipment, process recipes, all of that has to be figured out. And then you have to pilot it, you have to develop a customer base. So that so by the time somebody like me gets involved, they’re at the market, they’re generating revenue, and they’re five or 10 years out, it’s not a start.

Nathaniel E. Baker 16:29
Okay. Okay. So I want to come back and talk some more about the in a little bit about the way that you do it. But first, we talk some a little more about the some of the some of the areas of opportunities that you see, and some of these new technologies that you’re talking about other areas that might be of interest to listeners,

Robert Cote 16:49
another example would be tech stocks. There is a commodity business, it’s all been moved over overseas. North Carolina soft, South Carolina used to be the hotbed of textile manufacturing in this country, it’s all moved offshore to low cost labor markets. Because the innovation in actually building a piece of clothing did not keep up with the time sort of speak. And so what happens is many, many people can now replicate what you do, and the only way to compete is on price. So we wind up seeing the margins go down to zero or near zero. And that means we’ve got to shift it offshore. And when I say the old stuffs not coming back to America, that’s the reason but the new stuff, the companies like this textile example I’ll give you that are doing something new and different in their market. In the case, we’re going to talk about its textiles, they bring the high growth and high profits we haven’t seen in decades back to manufacturing. So we can support local manufacturing here where our highly skilled workforce is necessary. And so the textile example is an example of taking waste, waste off the factory floors, clippings, when you cut and sew the fabric into a piece of clothing, or taking the waste the garments that you and I would throw away at end of life. There are many take back programs, h&m and other major retailers globally, have been taking back clothing, instead of it going into a landfill. Or in an incinerator to be burned and creating an environmental hazard, we can actually take that waste in a line of equipment, it’s about 150 meters long, and turn the waste back into version quality fiber, I can get back the original fiber of the same quality and actually spin it into yarns, turn the yarn into fabric, turn the fabric back into the same high quality clothing that that waste came from in the first place. And I have a high margin business and doing it because the waste is very low cost as you might imagine.

Nathaniel E. Baker 19:09
Yeah. And none of these are particularly labor intensive, these these these markets, these companies,

Robert Cote 19:16
they tend to be not labor intensive, like traditional manufacturing. But they do require highly skilled workers in manufacturing that align perfectly with the workforce here in America that’s highly educated, that can work with computers and can do a lot more than is possible in the markets that now have. What is really most of our manufacturing base.

Nathaniel E. Baker 19:40
Cool. All right, and we’ll talk about that after the break. Speaking of which, don’t go anywhere. I want to come back to you with Robert Cote and ask him many more questions actually. But we will first take a quick break if you are a premium subscriber. Don’t touch the dial you do not get the break. We’ll be right back. In fact, we already are.

Welcome back, everybody here with Robert Cote of Cote capital. Robert, this is the segment of the show where we ask our guests to tell us a little bit more about themselves and how they arrived at this station in their career. So you don’t have a typical, I don’t think I’m going off in assuming here, background that many, you know, public market investors have, or maybe you do, but tell us how you got into investing in the first place, and how you came to this current station in life?

Robert Cote 20:39
Well, I spent 20 years is actually an IP lawyer, but I took the the notion of an IP lawyer to the next level, and I began to invest with the companies that I was helping to come up with solutions for how do I take the engine in the car that’s new in different hardware companies, companies building real physical products that change the game, and we can talk about a couple of those. But what I realized was they were suffering for for a better way or struggling for a better way to maximize returns for themselves and for their investors. And so I would partner with them. And we would invest in licensing and scaling the use of the engine in the car, they would build a corporate stores here in this country and in places that were profit optimized for their business, but to really accelerate not only the impact of what they had done around the world, but to grow that business faster and better with lower risk for themselves. And their investors, they had to get comfortable with sharing the engine in the car, that breakthrough in the car, they could drive their own cars and sell their own cars, but they could do much more for themselves in the world by sharing that engine. So I would help them share that engine. And one of the critical skill sets that may be perfect to ride I like to say shotgun with them on that ride was that I was the predator in the IP circle of life to use a cute term, I was the guy who would protect them. When they went out and ventured around the world and shared their innovations. I was the protector of these companies. And you just can’t find that in the financial industry, somebody who can maximize the value of your business, where maximizing it requires sharing. Most people want to hold that diamond in their pocket. They don’t want to share it right. They’re actually holding themselves back. They’re limiting themselves. We all do it right fear gets in the way. And so I bring down those barriers or fear because that’s somebody standing next to them, who spent many, many years on the front lines, protecting entrepreneurs and innovators. It’s only that experience that allows you to know what to do or use a cute wine to be able to walk blindfolded through the darkness yet see. And we know it can be dark in this world. We spent many years hearing about China still stealing our IP. We hear about it every day, even today. And we’re trying to change that up change that game.

Nathaniel E. Baker 23:08
Do you take an equity stake or not?

Robert Cote 23:10
Not. You want them to own their business pretty important. Because of all the years it takes to get to market, they’ve given away a lot of the equity, they can’t tolerate a much, much big bigger equity grab, given where they stand today. And it’s it’s when they really can have the impact. It’s when they need to scale. And they need the capital to scale.

Nathaniel E. Baker 23:31
So it’s not just like the traditional growth financing model or merchant banking type of thing?

Robert Cote 23:36
it’s Merchant banking in a lot of ways, because you’re actively helping your company build up business, you’re not just sitting back putting money in and sitting on a board. I’m actually on the front lines trying to figure out how do we grow this business? Right,

Nathaniel E. Baker 23:49
right. Right. But I guess it was separated from Merchant banking is this is these are technology heavy companies. And like you say you buy the intellectual property, or

Robert Cote 23:59
I invest in the in the company. Yeah, the investment goes to building out what you need to scale the use of your IP, build more cars with your IP use Tesla as an example, right? Got to build manufacturing plants to be able to build that Evie car, that electric vehicle. There’s a tremendous amount of innovation in that vehicle. I’m the guy early on who would come in as they entered the market and invest in building that first plant with that, right? And what am I investing in the IP if you start to think about it, that’s what people are buying that car for? Yeah, I’m investing in the IP that makes the car different. And I’m investing in the IP and the equipment that allows you to implement the innovations that make that car different. So it’s kind of both so I’m an IP investor, and then I’m holding that asset as security if the company were to fail, so it’s asset backed, very much like a real property investment and then I’m sharing in revenues You own your business very important. I want you to own your business and have maximum incentive to make that business successful. Because anybody who’s built a business knows it’s no walk in the park, it is quite a quite a ride and quite a challenge. There’s a lot of challenge along the way. And you need to be incentivized to do that hard work.

Nathaniel E. Baker 25:22
Got it. And so then you take a portion of that of a cash flows. And then that is then shared with your LPs, your investors, and in a certain way that it’s structured, right?

Robert Cote 25:33
Right. And so I’m creating a real property like investments so that more and more people, one that don’t have access today. And two, aren’t really comfortable with an equity investment style, which is really a lottery ticket where it may or wait 10 years, hope for the best. Much of it is software, much of it actually doesn’t pan out or payout is the reality. If you look at venture capital returns, they’re underperforming by a longshot, yes, we have some good years here and there. But they’re underperforming by a longshot, because of the nature of software, low barriers, easy to copy, easy to replicate, hard to liquidate a public or sell that asset. So they’ve been struggling, I want my investors to come in and help change the course of this nation by investing in hardware companies. And they need a lot of capital. And so the way that you get people comfortable is creating something that looks like a real property investment asset backed by the property, and cash flowing from the cash flows, the company generates from using that property that IP. And so we share those cash flows with our investors to create a dividend, or income producing investment, just like real property, so they’re comfortable with it. And the asset that we hold in security, along with the cash flows, changes dramatically the risk profile of investing in these earlier stage companies, early revenue companies direct versus the lottery ticket style of venture capital, mostly in software today, that scares many people away, because the performance has not been there. And the risk looks pretty scary to them.

Nathaniel E. Baker 27:19
And it is it is only open to qualified investors or, or institutions

Robert Cote 27:25
Accredited, and institutional today. But actually the vision is to, as we grow in the number of opportunities to bring in through reggae, and other mechanisms that will come in the future. The masses, the people, anything in this country that has helped fuel the growth of this country always had to have the right capital solution behind it. So I’m bringing the right capital solution. And the right capital solution has to be one that would allow the people in not just the 1% to 2%. But the masses, because they care more than anybody about changing the course of our country and bringing our manufacturing base back. And going back to basics, the very things that created this nation, and industrial base where we make real things. How do you go about sourcing your ideas. So that’s actually pretty easy. When you’re one of the leading IP lawyers in the world. And your focus is hardware companies doing something really different breakthrough, that means they’ve got real significant IP. So that means the IP lawyers show up, and they try to protect you with IP rights, patents, trade secrets, because I known throughout the world in that market, that’s how the flow comes to me, they know that I’m the only alternative to venture capital. I’m the guy who can help them protect their IP as they enter markets, right. And I’m the guy who has the solution that won’t dilute them and will leave them with the ownership in their business. So once you kind of know those things, it’s pretty easy to come knocking on my door. So it flows to me, as opposed to going out and trying to find it. I’m not in a ocean, like just another venture capitalist chasing too few deals. I’m sitting alone with an alternative model that’s better for investors, asset backed cash flowing better for companies, I don’t take equity, I share in revenues, they own their business, and you just can’t get that. So it’s actually pretty easy for it to flow to me, instead of me trying to find it, like many venture capitalists have to do today.

Nathaniel E. Baker 29:47
Interesting. So your your whole career before you start. Where did you start this? This thing?

Robert Cote 29:51
Well, I spent 20 years doing exactly what I’m doing today. Okay. We we generated $3 billion in return Since from investing in IP, the first 10 years was around a technology called PCR, you’ve taken the PCR test, it’s actually a technology won the Nobel Prize, won the Nobel Prize in Chemistry, it allows you to see DNA in the body, otherwise, you wouldn’t be able to tech detect diseases and viruses. So that company built the corporate stores. And then they licensed manufacturers around the world to build the equipment, the thermal cycler, and the chemicals polymerase, to be able to actually see the DNA in the body, you actually amplify the DNA, I can target the DNA, but I can’t see it. I actually through this PCR process, turn the needle, what I’d like to see into a million copies millions of copies, turn it into the haystack. And now I can see it, very simple idea, but a revolution that created the biotech industry. So I did that for about 10 years. And then for the most recent 10 years, a variety of different things. From the next generation electric motor, semiconductors, the power of your phone and other devices, wireless is probably the most notable, that Wi Fi in your phone or in your home. Or that 4g And that 5g, it’s actually powered by a technology called OFDM. orthogonal frequency division multiplexing. It literally takes what’s physical, you turn it into energy, you carry it on a superhighway of wireless signals, you can see with your eyes, and it takes that video, that book, that movie, that email, at the speed of light into your phone, bouncing off walls, in buildings and in your pocket, and turns it back into physical, we don’t even think about the magic that’s required. So I did, over the most recent 10 years, I spent a lot of time helping a company licensed the use of that OFDM technology into Wi Fi. So many, many people could sell Wi Fi products. And of course, 4g and 5g that’s now in our phones. And so those are kind of couple of examples of what I did over the 20 year period. And so it was a great model that I wanted to make accessible so that we could find many, many more of these hardware companies that are struggling for capital today, here in this country and around the world, you really make a difference because they saw the value of what I was doing. IP investing always beats equity investing, because it’s got an asset that protects it. And it shares in revenues for cash flows better for companies better for investors, they get paid to wait better for companies, they own their company. And so I wanted to open it up to the masses. So I’ve only recently started building this in the past couple of years. And you can go to my website, CoteCapital.com, CEO, te capital.com. And you can see what I’m doing the mission is investing in the future of America. And we want many, many people to join us. We want to build an army, I like to call it Cote’s Army. But that’s really going to make a difference in this country. Because I don’t know about most viewers or listeners, but I’m tired of listening to the rhetoric, tired of hearing people say they’re going to do it. I’ve seen that it’s possible with my model. We just need to have an army around it to actually fuel many of these companies that are struggling today to get capital, these hardware companies that can bring our manufacturing base back not only old stuff, but in advanced manufacturing that matches to the skill set the high high skill set of American workers.

Nathaniel E. Baker 33:44
What are you doing? Is there anything in automotive technology, driverless cars or anything like that? I always ask that to anybody who’s connected with VCs if there’s how that’s

Robert Cote 33:52
driverless cars now that actually a lot of that is a software is okay, you’re right. You’re right. You’re right. However, cameras and other hardware technology is used in it. It’s a very conscious, concentrated market, right? Very few buyers of the companies. So I haven’t done anything in it. But I’d be more than happy to do it. But I’ll give you other examples. New generation electric motor, an axial flux permanent magnet motor that goes in the wheels of vehicles. Wow, goes in torpedoes you can’t hear goes in helicopters to spin the propeller goes in trains to pull the wheels but it’s in wheel instead of in the engine is a game changer in how we make electric vehicles. So that’s an example of something that I’ve worked with. That’s a whole nother story in and of itself. But that’s one example of an auto mobiel related innovation that really or transportation related innovation that is going to over the next couple of decades make a real impact.

Nathaniel E. Baker 34:58
Hang on. So these are these are the spaces It removes the need for a motor and vehicles. Is that Is that right? In

Robert Cote 35:03
right now electric motor sits in electric vehicles or radial flux motor in the actual engine compartment. Yeah, it just got the engine compartment and put the motors in the wheels, and they are doughnut shaped motors that power the wheels to turn.

Nathaniel E. Baker 35:17
And you can do that on for trucks. And you mentioned trains and big trucks?

Robert Cote 35:22
Anybody who’s a fan of the movie Planes, Trains and Automobiles.

Nathaniel E. Baker 35:27
Yeah, that’s pretty groundbreaking, if that were to be adopted on a large scale, because that would change the entire way that automobiles and any are engineered.

Robert Cote 35:39
Right and correct. Yeah.

Nathaniel E. Baker 35:42
So that’s big. And that’s that’s becoming a reality?

Robert Cote 35:44
That is already reality. Google it, and you can learn about where it’s being used. Helicopters, planes, trains, automobiles, torpedoes. And I’m trying to think of other kinds of things that would be maybe sexy for the audience. There are many, many, well, let me step back. Augmented reality. There’s a company that has built a hardware device that you can wear as a doctor in your head, and it will actually image in 3d the organs of the body. And so the doctor can actually see, as if he were in the body, everything he’s working on. It’s a wonderful thing in 3d. seizure, before he starts on you, literally in his hand, he can see an image. And so that’s a company out of San Diego. That’s building what I hope will be ubiquitous around the world, a device that will really improve the quality of health care of surgery in

Nathaniel E. Baker 36:52
we’re basically talking X ray vision here, Robert?

Robert Cote 36:56
Yes, we are.

Nathaniel E. Baker 36:57
So you could like see through people’s clothes. Correct. So maybe we shouldn’t let that get out to the masses. Wow, that’s fascinating.

Robert Cote 37:05
Yeah, it’s, it’s amazing how 20 years of reading in the press about software companies and social media companies, and offshoring our manufacturing to compound the problem that we forgotten about our manufacturing base, we forgotten about our communities across the country. And most importantly, we forgot that there are many, many young companies building hardware, new manufacturable products that can actually change the course of the country and bring back our base, which we need to do. No question about it.

Nathaniel E. Baker 37:44
Yes, yes. You’ve made that point very clearly. I think. In closing, maybe tell you, you mentioned your website, CodteCapital.com. And are you active on speaking of social media? Are you active on social media? How else would people be able to get in touch with you?

Robert Cote 37:59
So you can go to our Cote capital, Twitter feed LinkedIn

Nathaniel E. Baker 38:03
There is a Twitter feed, right?

Robert Cote 38:04
the Twitter, we have a Twitter, we’ve developed, I don’t know, maybe about 100 different videos of me and other notable figures in some of the companies that we’re focused on. So people get a feel for our mission, you know, what is what is it all about bringing manufacturing back by investing in this new generation of hardware companies, they get a feel for our model, we try to take a deep dive and little soundbites video clips. And that allows them to understand this asset backed and cash flowing like a real property investment, we want them to get comfortable, and they get a feel for some of our deals, some of them that we talked about today that really, really show you the power of breakthrough innovation and what it can do in this country, not only to bring advanced manufacturing back, but to have an impact in the world. And finally, I would say if you go to our website, we have a live q&a. Our first live q&a q&a for this year, will be on February 16. We’ll try to do those once a week throughout the month of February into March. We’d like lots of people to attend, and listen to what our mission is about what our models about enter deals so people can get comfortable because again, I can’t do this alone. With the people behind me the army, the Cote’s Army behind me, we can have so many more of these companies have an impact in this country and around the world. For people for humanity. Where are you based now? I am based in New York. Okay. The plan or whatever it’s worth. We do have as our agenda to move the business to Washington DC, okay, to what’s called an AVR just out from the Capitol, okay. Where we intend to put on our own show called capital raise. Next to the Department of Transportation is an amazing building. That would become like a today’s show kind of environment. People will be able to come in and see the various companies were invested in hardware companies with breakthrough innovation. And we’d have a show we’d be doing regularly featuring entrepreneurs, economists and others. Because we’re trying to change the course of the nation. There’s no other place another no no other place to be, in my humble opinion, than in the seat of power in Washington, DC, where we want to bring the change that we know is needed. Fair enough.

Nathaniel E. Baker 40:31
What last question here while I still have you? You mentioned, while we’re on the topic of software, I’d be remiss if I don’t ask you this is a software question, obviously, about digital currencies cryptocurrencies, if you have any thoughts on those, seeing how you are a technologist? Yeah, totally off topic. But yeah,

Robert Cote 40:49
well, I actually love the question. What cryptocurrency is, is really an innovation that puts power back in the hands of the people so to speak, it’s a way to trade peer to peer. So way to change exchange value, money is actually just the exchange of energy, you do something for me, right, and I pay you but I pay you based on the energy I put out for somebody else, it’s really an exchange of energy. So it’s just another way of exchanging value with each other. And I’m a big believer in technologies that, stick it to the man to use a cute phrase. Because it’s very hard to get the people who hold the reins of power to change, there’s no incentive to do it. We’ve got to invest not just in breakthroughs, like crypto, but in breakthroughs in hardware, and in software, chat, GPT AI, that revolution is, of course, prominent now in the press. And what I’d like to say there is that crypto is actually something that’s much more risky, even though it’s bringing change, and people are investing in it. Then what I’m proposing, I’m saying to the crypto audience out there actually, that I’ve got an investment style that’s asset backed, unlike crypto, and cash flowing, unlike crypto, and we participate in the exit to buy out our revenue stream. So you still have that upside that you’re looking for in crypto. So I’ve designed my model when you’re trying to approach an audience, to the people who really want to bring the change. And a lot of those people live in those crypto markets, they love the idea of bringing change. That’s what they’re backing, and they love the upside. But that upside is very, very hard to tolerate, sometimes, as we’ve seen in the past decade or so in the past year. And so my model was designed to bring people in those kinds of people who really want to be rebels with a cause who want to bring change, but bring them a model. It’s asset backed, and dividend paying are cash flowing, that still gives them that upside potential. That’s what’s that’s what’s missing. And I would say that’s my answer to the question of what about crypto?

Nathaniel E. Baker 43:12
No. All right, fair enough compelling points? Of course, again, they’re wonderful, Robert. Well, thank you so much. For all this. This is all very interesting conversation. I can’t wait to see how this all works out some of these technologies. I know listeners will be Googling furiously to see if there’s any way they can access these companies via public markets. And I assume the answer is no. But that’s okay. I will one day. And with that. I thank Robert again for coming on the show. Thank you all for listening. And we look forward to speaking to you again next week. See you then.

Moderator 43:51
Thank you for listening to the contrarian investor podcast. We hope you enjoyed this episode. To subscribe to this podcast. Simply open your favorite podcast software and search for contrarian investor. Follow us on social media by searching for contrarian investor on Twitter and Instagram. Send us your thoughts on feedback at contrarian pod.com. We look forward to speaking to you again next time.

Exit mobile version