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Quepasa Corp, (AMEX:QPSA), Becoming A Multi-Dimensional Business

|Includes: The Meet Group, Inc. (MEET)

With the New User Numbers for June being an abysmal 600,000 or so users...Why isn't the stock Tanking today after the Conference Call?

Here is how I see it. Quepasa is a multi-faceted business.

First, it has DSM Contracts which allows it to sell advertising directly to clients.

Second, it is a Social Network (this is what you are speaking about.) Which is definitely important but for what? Well, to do the above DSM and to use for Gaming and finally to use for a base to advertise to for various products, etc.

Third, it is a Game Development company. The Acquisition of XtFt Games S/S Ltda made possible Quepasa Games. Remember, the company owned by Lars Batista? Check him out and you will find that his brother (Eike) is one of the wealthiest men in the world. Why would he sell his company for $7.50 or so a share? He is no dummy and right now he is just setting at break-even. Quepasa Corp. (QPSA): Assuming Lars Batista is the largest owner of

Forth, it is a Games Broker company that can sell games through mediums such as Google's Orkut and Facebook. This is another stream of revenue.

Fifth, imagine having 38 Million email addresses...what could you do with that? I think of Groupon when I think of email addresses. Although nothing has been announced my belief is that this is another revenue option for them.

Also, remember that 2 Million people are playing their games and only a small number of those show up in the 600,000 new users at the website. Most of those are playing the games at Orkut and Facebook. Now, Quepasa gets the Revenue-Split on all of those players that are paying and playing at Orkut and Facebook as well as 100% of the Revenue coming in at even though they don't get the New User data.

Another thought is that John Abbot, Quepasa Corp CEO said that the issues they had with email made a difference in the New Users for June and is still impacting July. So, the number might have been higher than the reported 600,000 new users that was reported had this technical issue not have come up.

Finally, if the news was so bad...Why are shares of QPSA only trading down 3.75% right now as I type this? Wouldn't you think that if this was what intelligent investors were focused on that it would have tanked?

600k is not good, but the company addressed the e-mail situation in an upfront way. That problem is now Fixed. At one time most of the Shorts were complaining about the retention, now that number is going up and they will soon have to find something else to complain about. The game numbers are excellent and growing daily. The company has stated they will be in the Daily Deal (I interpret that as GROUPON-like) business soon, and the potential for Mobile is Huge.

Would I have liked to have seen 1.5 Million new users in June...YES! However, that has not dampened my opinion on QPSA as I still think it is just getting started.

Disclosure: I am long QPSA.