Rapid Fire Marketing Investor Update – 17 August

Rapid Fire Marketing Investor Update – 17 August 2012
Tom Allinder | August 17, 2012


Over the last several weeks, I have received a lot of questions from investors. I apologize for not being able to get the time to answer many of your questions. We are in the middle of rapid growth of this Company. This growth is not only in revenues and sales of products, but growth on the corporate side of the Company. This update is going to be a long one because it is going to cover nearly every aspect of the business. I encourage readers to read the entire update; there is a lot of important information throughout.

RAPID FIRE MARKETING TODAY – THE CORPORATE SIDE

Today, Rapid Fire Marketing is a much larger company than it was the day I took over as CEO on 15 March of this year. Back in March and April, this Company was pretty much me as the CEO and Judah Neiditch as the head of production and distribution for the CANNAcig. However, as I mentioned early on, my primary objective on the corporate side was to get this Company cleaned up and fully reporting and move it to the OTCBB.

I have written about the importance for the future of this Company to get fully reporting on numerous occasions in news releases, updates and in correspondence with shareholders. The primary reason is funding. As a non-reporting pink, our only way to raise money to grow the Company is through short term funding which is a 50% discount to the market price. In order to access better terms with regard to financing, we need to get fully reporting. We are well on our way to accomplishing that; more about this process later.

I Have Help

Today we have 2 firms which are working on getting Rapid Fire Marketing to fully reporting status. Altogether there are 4 people working on this project alone. 2 of those 4 individuals are essentially performing the duties of the Company’s Chief Financial Officer (CFO) full time now. We have one full time Netsuite Administrator. Cheryl Shuman, Company Spokesperson/PR and Product Development is now pursuing Rapid Fire Marketing’s business as a nearly full time project. Judah Neiditch now has 2 people in the distribution office. And, I have hired a full time consultant who is an ex-CEO of a successful publicly traded company to assist me with everything on the corporate side. We also have one individual that is managing a significant number of aspects of marketing including social media. So, this means we have 11 people working full time or nearly full time at or on behalf of Rapid Fire Marketing today.

The Business Plan

Our Business Plan was finalized in June. Realize though, that a business plan is a dynamic document and companies that are on the ball will continually update it. Our business plan will always be “a work in progress”. For those that want to see some evidence of the business plan you can download it. And, yes the page numbers are not defined because I pulled this excerpt out of the actual document. But, on the left side you can see all of the sections that make up the business plan.

I only included the first 4 pages because the plan itself contains a significant amount of sensitive information. This business plan has been shared with funders and other entities that have required it for services and insurance. More on the business plan later…

Getting Fully Reporting

Back in March, as the new CEO, my first phone call was to the individual who would become my full time consultant. He was in the process of retiring from his Company which he founded and was the CEO of for 11 years. His Company has been extremely successful at the micro cap level. Over the last several years, he managed to raise over $30 million in funding and grow his company from an idea to a multi-national company with over 70 employees. Millions upon millions of dollars of value were added to the company under his guidance. I watched carefully over the years as he effectively created a “blueprint” on how to build a powerful company at the micro cap level.

In the first couple of conversations I had with him, I excitedly told him about this huge new opportunity in the vaporizer business. As expected (and planned on my part), my excitement rubbed off on him and he bought a ticket to this show.

He came onboard in May and has been instrumental in spearheading our efforts to get fully reporting and to establish better sources of funding for us. When we file the 10K, the identity of everyone involved including my consultant will be revealed.

Speaking of the 10K…

The creation of the 10K is literally the cornerstone document of getting Rapid Fire Marketing to fully reporting status. The 10K covers every detail in great depth about a company. It is basically a statement about the company which gives any investor complete transparency into the company they are invested in or thinking about investing in. Remember, I told you all early on that transparency is a must for any company that wants to be seen as a real company in the eyes of investors or prospective funders. Fully reporting status includes the filing of a 10K which enables us to appeal to a pool of bigger and more sophisticated investors as well as better funders with better funding terms. No real fund is going to invest in a non-reporting pink and a non-reporting pink will never be taken seriously by serious funders regardless of how much revenue and profits they generate.

The 10K itself is a huge document. Putting one together from scratch for the first time is a monumental task. It is especially challenging when being done on a company like Rapid Fire Marketing which has never filed with the SEC and has never had the responsibility of transparency to shareholders.

Forensic Accounting

The first process of completing a 10K for Rapid Fire Marketing was to gather ALL DOCUMENTS pertaining to the company including articles of incorporation, tax records, all financial records, invoices, stock transactions as well as a myriad of other documents. This is effect is an AUDIT with our accounting and consulting firm.

Rapid Fire Marketing’s history from a documentation standpoint has been a significant challenge for me and all involved in the process. This is the reason it has taken so long to complete. We are in the process of gathering the last of the documents that are needed to complete the 10K. Before we can file the 10K, this Company’s previous 2.5 years needs to be accounted for. All monies spent regardless of amount have to be backed by an invoice, contract or other verifiable document. The same goes for income claimed by the Company.

Once this 10K is complete which we expect to be a matter of a few weeks, it will be filed with the SEC .The audit process should go quickly (weeks, not months) because we will ensure that anything and everything that can be questioned will be accounted for in that 10K.

Once the audit is complete and satisfied, we can then file the 15c211 to move to the OTCBB. We will be a fully reporting and transparent Company. We expect this entire process to be complete late in 2012.

Funding

We now have two funding sources committed to a total of $4 million in financing for Rapid Fire Marketing. At this time, we are building out a plan for the money which includes all the vaporizers, accessories, and spare parts we intend to order through the end of this year.

These funding vehicles are equity based, rather than debt. Since we actually know our funders, we are committed to working as a team to achieve the objectives of the Company, its investors as well as the funders.

The current funding is typical of pink sheet stocks, and the new and improved funding requires us to be fully reporting. I believe we are winding down the use of short term funding for this Company. Additionally, with our now completed business plan, we have authored a stock purchase agreement (SPA) for investors that want to invest directly into the Company. It is possible we will use this as a funding mechanism as well.

Revenues

While some investors view our announcements forthcoming such as who is funding us, who is getting us fully reporting etc as “magic bullets”, the real magic bullet for ANY company is revenues and ultimately, profitability. While the first two quarters are uninspiring with regard to revenues, investors will see a significant difference when we report 3rd quarter revenues.

At the end of each month we calculate how much money we spent and how much we took in and how well this is matching up with the projections in our business plan. Another function that this procedure accomplishes is that we are able to see what effective means of spending money are as well as what is ineffective. We are then able to make adjustments monthly to run The Company as efficiently as we can.

Over the last couple of months, the gap between the amount of money we are spending and the amount of money we are taking in is narrowing. August (this month) is going to be a very good month for us as we are realizing revenues from several streams including online sales, sales at shops, sales by distributors and wholesalers. We expect to continue this trend indefinably and ultimately become cash flow positive as discussed before. Revenues and Profits are the only PERMENANT magic bullet.

RAPID FIRE MARKETING – THE BUSINESS

Medical Cannabis Management and Bionic Cigs

The Medical Cannabis Management (MCM) was problematic from the outset, and had little revenues to show for it. In spite of a significant effort, the disposition of the first and second crop and harvest is essentially that it would cost more money in attorney fees to collect the revenues from the first harvest. The second harvest was never realized.

When I came aboard as CEO, my plan was to close MCM given its history and the nature of the business. However, a couple of weeks ago, Cheryl approached me with an idea to restart the business as a consulting business. The market, it appears for consulting is very large, and if the business is done right and with the right people, it could provide a significant revenue stream in the future. However, I want to get the vaporizer business running full blast before we start looking at other businesses to get into.

BionicCigs.com, despite a significant marketing effort has attained very little revenue. The electronic cigarette business is extremely competitive and without a lot of funding for marketing, it is not worthwhile to pursue. I intend to close this business because it has always cost more to operate than it has made.

VAPORIZERS

Andrew Carnegie said, “Put all of your eggs in one basket and watch that basket”. That, in effect, is what we are doing for the time being with Rapid Fire Marketing. We are so committed to the vaporizer business that we intend to change the name of the Company and the ticker symbol when we go on the OTCBB.

There is obviously a huge market for vaporizers; and, there are a lot of competitors. Competition makes companies stronger. We believe we will win this competitive battle over time, and all the while getting bigger and more diversified in this business as time goes on.

At this time, as most of you are aware, the CANNAcig is our main product. We are ordering accessories and spare parts to provide a new stream of revenue.

We have developed solid distributor relationships and in short, we are moving our first supply of CANNAcigs very quickly. Part of the funding I explained earlier is to purchase more products, accessories and parts and we are lining up that order now.

Additionally we are increasing the size of our staff in the Los Angeles office to respond to orders and orders for spare parts and accessories. We are also in discussions with new distributors every day to carry our products in their shops or on their websites.

The CANNAcig… IT WORKS!

The CANNAcig has worked out very well for us because it WORKS! We have had very few returns on the unit. Other units similar to the CANNAcig are getting returned at alarming rates. This is because they have rushed their units into production for the sake of making sales. That sort of business will almost always lead to failure. This is why we took so long to get the CANNAcig into production; we did not want half or more of the units returned to us. We wanted a product that would work and be trouble free for both the user and us as well. Just watch the last part of Cheryl Shuman’s interview with Tommy Chong; his statements regarding the CANNAcig are priceless.

I assure you that all the vaporizers we will bring to production over the coming months will get the same sort of attention to detail that the CANNAcig received. They will be quality units that work and sell well because of our painstaking attention to detail.

Partner and Affiliate Program

Judah Neiditch has been working very hard on the partner and affiliate program. The theory behind use of partners/affiliates is to get our products on as many websites as we can for ecommerce sales. Details on the partner/affiliate program will be announced soon.

New Products

Development of the Pocket Puffer is nearly complete and details on this new vaporizer will be announced soon. Contrary to what many seem to think, it is not just a base unit that we branded for sale. A lot of work has been put into the development of this product with HexCorp. Details will be announced via news soon. I am personally excited about this unit because it has a feature that no other vaporizer has…

Project V

Project V is the “code name” for the product that we have funded to be developed from scratch. Once developed (within a couple of more months), we will trademark and patent this device. This will be a vaporizer that performs to a whole new level for vaporizer users worldwide. HexCorp (news coming on our relationship with HexCorp soon as well), is developing the unit for us and Judah is essentially the creator of the concept of the unit. We expect this unit to sell extremely well because it will be far superior to anything that we have made so far and certainly superior to anything else on the market as well.

By the end of the year we expect to have 4-5 units in circulation for the vaporizer community.

Product Marketing

Cheryl Shuman is heading up our marketing efforts. Her connections in the MMJ and vaporizer community are extremely valuable to our Company. She is pursuing relationships for our Company with everyone that is at who’s-who in the business. She is also attending and being a prominent part of all trade shows, conferences and other functions that will forward the marketing of our products.

From this point on, our presence at “shows” will be confined to those conferences where influential people can be met and eventually worked with and just as important, shows that are for buyers of vaporizers. By buyers, I mean those decision makers who buy large quantities of new products. News regarding our presence at trade shows and conferences will be disseminated once finalized.

Additional Product Marketing

Building a brand is essential for a company to be successful in 2012 and beyond. I am specifically speaking of building an online brand. When your Company’s products are being talked about on social media platforms and blogged about on websites in a positive way, it has the tendency to spread rapidly across all online platforms.

This is a part of our business that I am personally involved in. Up to this point, I have been swamped with work on the Corporate side. With this part of the business reaching a point of critical mass, I want to work with our team to build our brand at a much faster rate. Brand building of our products and our Company is of the utmost importance.

Why is Company and Product Branding so Important?

At this time, there is a stock on the pink sheets that everyone is talking about. It is a beverage company. I know the CEO of that company extremely well. His company spent a lot of money through short term funding to build a company and brand a product. All you have to do is look at the performance of this company’s stock since the middle of June to see how it worked.

His company and shareholders went through a lot of pain for over a year to accomplish the goals of the company. Bear in mind, the stock of this company is trading at over a penny and a half today with 2.3 BILLION shares outstanding. It has come a long way since the lows of .0003 in the middle of June.

Bottom line is that he built a company and a brand(s) FIRST. This is the only method that works…

In short, the way it works for a pink sheet company is this:

Spend the money any way you can get it (short term funding) and build a company…
Spend the money and build a powerful brand…
Once items 1 and 2 above are done, the value of the company is very likely to increase substantially in the marketplace…
Prepare the Company for your exit strategy…
Continue to build the business and products through branding and sales until you get an acceptable buyout offer…
Most micro cap CEOs seek to build their stock first; this usually results in failure. The stock price is a reflection of the PERCEPTION of the marketplace. In the building phase of a company and its brand, the perception among many investors and market participants will always be negative because we live in an instant gratification world. But, through hard work and persistence via a great plan, I have a great deal of confidence that we can work our way through all 5 phases I spelled out above.

Tying it all Together

Because Rapid Fire Marketing has individuals working at several locations throughout the U.S. we decided to implement a system that would tie the entire business together and give management visibility into every aspect of the business; both the company and product side.

Over the last 3 months, Rapid Fire Marketing has been implementing and setting up Netsuite to manage all aspects of the business. The Netsuite System is a scalable cloud platform designed to help business achieve faster growth, streamlined operations and greater productivity. It is the most complete system available and includes full-featured accounting, Customer Relationship Management (CRM), product inventory, and interfaces with all of Rapid Fire Marketing’s ecommerce and affiliate operations. Netsuite is a real-time system which gives unlimited visibility anywhere and anytime for management of critical business information.

We hired an individual with extensive Netsuite experience to set the system up for us. I am impressed with how easy it is to use. As the CEO, I can log into the system and see, at a glance exactly where the Company stands at that moment with regard to finances, production, and distribution.

For the last several months, Judah and I have been corresponding via email and phone. At times, it seemed impossible to keep up with the production and distribution part of the business. But now, Production and Distribution are completely connected via the Netsuite System.

Another key function that the Netsuite System provides is complete accounting for all expenses and income for the Company. At the end of the quarter, all the Netsuite data can be exported to the accounting department which will make quarterly and annual filings much easier. For annual reporting, the system will make the auditors extremely happy because their job will be so much easier not to mention saving the Company money by being so well organized. The system also creates a database of all customers, wholesalers, distributors as well as other individuals and businesses that are part of the sales channel.

I can tell you that having Netsuite up and running has really made a huge difference in all aspects of our business here at Rapid Fire Marketing.

SUMMARY

I know this has been a big update. I hope I have managed to answer most, if not all questions from investors and prospective investors. I think you can clearly see now, that there is a lot more to Rapid Fire Marketing than what meets the eye today.

On a personal note, I can tell you that while the challenges to our business have been many, to date, we have managed to overcome all the obstacles thrown in our path. This does not mean that the challenges today are fewer or less substantial. In fact, as our Company grows, more difficult problems arise. But, just like today and in the past, we will meet them, overcome them and continue to move forward.

Perhaps my greatest gift as human being is my ability to put ego aside and realize my own personal limitations. As the CEO of Rapid Fire Marketing, my daily activities do not involve barking out orders to my team but rather, SERVING my team. It is my job to ensure that every member of the team has exactly what they need in the way of resources and authority to complete their tasks. I trust my team and let them perform their jobs. I realize how blessed I am to have Cheryl Shuman, Judah Neiditch, our marketing team, financial and accounting team and my consultant onboard with Rapid Fire Marketing.

Building a company is like watching a brick layer go about their task. Before the brick layer starts, we are confounded by the scope of the job that they have before them. But day after day, the bricks are carefully put into place and almost before you know it, the building is taking shape. Finally one day, the structure is complete.

The scope of the task before me as the new CEO in March was similar – it seemed impossible to most, to take a very small, one officer company to being a real company with revenues, profits, fully reporting, a board of directors, management team and in a better marketplace. The fact is that very few companies that start the process at the level that we started it ever succeed. The task looks too big and the obstacles are very large and are many in number…

But I convinced all the right people that we could do it. It would be hard, and painful but the rewards that lie on the other side of the process are much greater than the sums of the problems and obstacles in our path to reaching the place we want to be as a Company.

All of the items I wrote about with regard to the growth of this Company in my early days as CEO are either completed or are in process of being completed. We will attain success as a Company and for our shareholders. Just like the brick layer with the seemingly impossible task before us, we will get there, brick by brick. As a Company, our finest days lie ahead of us…

Tom Allinder
CEO
Rapid Fire Marketing

Tags: 10K, CANNAcig, Cheryl Shuman, featured, financing, Investors, rapid fire marketing, rfmk, Vapor Inhalers
Category: Rapid Fire News, Rapid Fire Updates