LookingConfident's  Instablog

....."We have begun the process of bringing ownership thinking to our employees" is such a refreshing message that Looksmart's newest CEO Michael Onghai has passed on to shareholders.

Michael has just delivered the Co's First Quarter 2013 Financial Results, yesterday.

In a quickly changing world many may feel that too many young people are being told what to think rather than being told, "how" to think.

[Looksmart's] "Ownership thinking"....There's no doubt, that...

Education is the answer...not 'the stick' .. Education and NOT of the indoctrination kind, that will see future people becoming slaves under the control of, corporate ("board-room") idealism. No more, no less.

This can only (ultimately) result in NO more "free" thinking. People have a need to learn how to control their minds ....and for them to not have their minds take control over them or, have them controlled, by others.

In my (1st April, 2013) instapost Looksmart CEO Michael Onghai's Initial Report I'd opined the following:

........With operating expenses now down to about $2 million per quarter post 2012 (this estimate does include all cost related to the operating of the Company's data center) and a TAC going forward (my estimate only, of course) of just 20% of all post 2012 comprehensive revenue or, income, there's a distinct possibility now that Looksmart CEO Michael Onghai's 'intention of seeing profitable revenue growth in the future', may well come sooner than many could ever imagine.

It's pleasing to read (from the Q1 Report) that Looksmart's ... "Total operating expenses in the first quarter of 2013 were $2.1 million and included $0.02 million of non-cash, share-based compensation."

And for the Q2 Period we are currently in?

I see PROFITABILTY being announced for THIS period. [Note ps;]

Well played, Michael Onghai and Team Looksmart.

LOOK: $0.74 0.03 (+4.18%) May 15

Always, only an opinion.

LC

ps; Not so soon though. (As I had though may happen.)

From the 10-Q ... HTML

In a mention of the Co's Advertiser Networks Revenue for Q1 (1.74M) and looking ahead, the Co advises that ..."We expect that in the near future advertiser network revenue will generally remain at levels realized in the first quarter."

With Publisher Solutions ($0.26M) possibly, likewise:

...."We expect that in the near future publisher solutions revenue will generally remain at levels realized in the first quarter."

"Operating expense for the three months ended March 31, 2013 ($2.09M) included $0.5 million related to the tender offer by PEEK. Excluding the effect of this charge, operating expenses decreased by $2.4 million in the three months ended March 31, 2013, compared to the three months ended March 31, 2012."

"We do not expect substantial future increases in general and administrative expense."

It can't get any worse that this quarter, surely?

"As of March 31, 2013, we had 17 employees."

(Trade accounts receivable, net $1.44M)
( Deferred revenue and customer deposits $1.10M)

Q2? Break-even, at best.

Disclosure: Long LOOK

Friday's close gives Looksmart a Market Cap of just $12.53M.- And anyone who considers the Co is 'over-valued' down at these low levels (there are a few), must surely have rocks in their head. Certainly when considering that the Co had ended the 2012 year with $15.9 million in cash.

Looksmart are in with many other small Co's (and globally, they've had billions of $$'s invested in them), that are seeking a small yet profitable "share" of an ever increasing digital ad-spend.

Few AdTech Co's can boast they are making any real money outside of established big players, and led by Google. - While all are 'spending plenty' to create a 'unique formula' or, develop improvements that can assure them of a regular share of that total (growing), ad-spend.

In my previous post I expressed the feeling that operating expenses were now down to around the $2 million per quarter level. I'd also felt (with Comprehensive Revenues of say, around $3.0 to $3.5 million), a likely return to profitability won't be too far away.

This is in spite of the Co's uniquely independent search intent based marketplace (in the global ecosystem) being anything, other than an ongoing 'work in progress'. And in any assuming that Looksmart are actually adding more 'improvement/s' (to it's RTB AdCenter 'buy/sell' side offerings), becomes only a guess.

Targeting of Search Intent

To me, it has become a little comforting to read the following interesting comment to an AdExchanger article, and its from some-one who had actually departed from his CRO role at Looksmart, back in mid January.

Chris O'Hara says:
April 4, 2013 at 11:51 am

........."I was recently involved with a company trying to build a search retargeting technology that leveraged keyword-based search data & applied results to display inventory. The biggest challenge was that we knew SEM buyers demanded quality controls to prevent click fraud.

............They [the SEM buyers] trusted Google and other Tier One search clicks, but were not sure they were going to get quality when ads were delivered across display-based exchange inventory. ....After looking into quality control practices across a number of exchanges, we determined that there were no effective security measures in place to test quality at both query time and click time. That was a scary realization.

I hope we as an industry can solve this. Without strong quality controls in place, there is no way display will be able to eat into other channel budgets and exploit the "Meeker gap" in lost revenue opportunity, even as time spent in digital channels increases."

Chris' comment was to the above-linked article that's entitled "Display Advertising Fraud is a Sell-Side Problem" and he advises quality control is a concern for both search query & inventory, in some instances.

[Yet, for Looksmart buyers/sellers.] It's all happening in Real Time.

I'm wondering why there isn't more emphasis made on the "user" (who instigates the query and any resulting paid click - all in real time) rather than whose search engine/inventory that a user had originated [on] or, was found, on. And that on an impression by impression basis (that may or, may not lead to a paid click), each individual user must surely be of the utmost importance. When/then (ultimately?), its the advertiser's ROI that will always become the final judgment.

Just an opinion.

LOOK: $0.7240 0.0240 (+3.43%) Apr 12, 3:42PM EDT

LC

Disclosure: Long LOOK

.

What's happening in Search? What lies ahead for Google?

In a comment made to an excellent WebProNews article by Chris Crum today (Will Google Ever Stop Dominating Search?), Kathy Alice Brown (a technologist, author, blogger & SEO consultant) advises readers that she had only written a blog post a week ago, "Will Google Search be Relevant in 5 years?"

...The question is being asked of Google in a number of quarters today (like 'here' & 'here') and coincidentally, they have all come at a time when Google's stock price happens to be taking a bit of a hit - after having reached an all-time high only last month. - Interesting.

Kathy says that..We are seeing the rise of "destination sites" that for specific searches, you use those sites' search functionality rather than searching on Google, because the results are more relevant & possibly more trustworthy - fragmenting the search landscape.

Just for fun, I asked someone not in the technology field a few days ago where she would search for "printer ink" and she answered "Amazon", so Amazon is definitely is making inroads into the shopping searches as this [Chris Crum's own], article states.

Kathy then explains that..With its complicated algorithm and periodic upheavals Google has made it hard for some businesses to do well in organic SEO. And that they appear to be favoring the bigger brands as one commenter as already noted.

The closing part of her comment (below), really caught my attention.

One disruption I see coming is a viable social search.- It might be Facebook's Graph Search or it might be something else- but regardless - I believe it's just a matter of time before we will have that as an alternative to some queries.

Who needs "Destination Sites"?

The ultimate in answering a user's search query habits will be a solution that can provide an instant (in Real Time) 'best' answer to each individual user, and no matter where that search query originates from.

Be it that need for 'a latté' & a phone app search via Yelp (for a nearby cafe) or, in buying an espresso machine by (as one suggests) searching Amazon.com.

That if a search was being conducted on Bing, Facebook's Graph Search, topical sites such as Yelp, TripAdvisor or Amazon or, any of the many other search engines ..... then a "same" set of (best) results can be provided on the SERP from off them all-that meets that (each & every) individual user's immediate want or, need.

For this to become that (Kathy's talked of) 'disruption' & the one RTB marketplace - that will favor neither big brands nor any small 'latte cafe' will most certainly require a total neutrality, access to real-time 1st party search data and the technology that can bring it all together - meaning, from 'both ends'/advertisers-publishers.

Have we (so quickly) forgotten PLAs? tinyurl.com/c5axczu

[That lend themselves to] An integration (of) Search & Display?

We'd been told within LookSmart's Rejection of PEEK Investment's Unsolicited Tender Offer that among its assets is LookSmart's market positioning as a:

• Scalable search advertising platform for ad networks;
• Independent ad network able to integrate Search and Display and deliver an efficient marketplace for advertisers and publishers; and, an....
• Independent ad network able to deliver high quality traffic to advertisers and high value advertising opportunities to publishers.

Note PEEK were successful in their bid and new CEO Michael Onghai (who had headed up the consortium) has delivered his Initial Report.

(PEEK had actually purchased a total 8,447,647 shares adding to the 836,312 already owned by their affiliates. PEEK now own some 54% of the total outstanding shares of the Company.)

The Co's Shareholders had previously been told:

That: LookSmart is well positioned to capture the market (for the) integration (of) Search and Display and the global opportunities for an independent integrated online advertising platform. (Read it.)

Shareholders were also told in a conference call following Q2 results, that Looksmart's technology was now capable of 'handling' up to 100 billion 'events' per day within an OPEN, independent Marketplace.

How, Where and When?

It's from within the amended FORM SC 14D9/A (Filed 08/03/12) is the LOOKSMART LTD CC transcript-where Looksmart's previous CEO advises all of the Co's plans, for what lies ahead. (In 2013)

..."When discussing game-changing events for online advertising with our customers and partners, there is strong consensus regarding the significant value an integrated Search & Display open marketplace would have for them."

Hopefully (swanson1), the above opinion of mine is sufficient to answer your own (so sad), last four comments - that you have made, HERE.

As always, only an opinion.

LOOK: $ 0.85 0.00 (0.00%) 3:59PM EDT

LC

ps; "The truth passes through three stages: First, it is ridiculed ~ Second, it is violently opposed and Third, it is accepted as being self-evident."- Arthur Schopenhauer

Disclosure: Long LOOK

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