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Who says you can’t be
IFS EQUITY RESEARCH GROUP
big and nimble?
2. IFS Equity Research Group’s Resources
Our OPEN-SOURCE research process and methodology are unique and are a distinct competitive advantage in
the broker-dealer industry
The IFS research team analyzes markets, securities and economics to provide insights and analysis for our
clients
Our team includes 8 seasoned analysts, including:
A research-producing Head of Research
A strategist
Two strategic consultants
The IFS Equity Research Group uses an open-source approach to discover ideas and converts them into living
research and actionable investment recommendations. This process includes communicating and exchanging
research and insights with internal analysts and external collaborators (such as investment research specialists,
theme developers, academics, and industry thought-leaders).
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3. Equity Research Services
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Market analysis
Theme reports
Proprietary Daily Commentaries
Company-specific Initiating Research reports and
event updates
Sector allocation and model portfolios
Integration of sector research with macro coverage
of industries
4. Thematic Approach
Our firm’s research takes a thematic approach,
focusing on disruptive/innovative technologies
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Industrial
Technologies
IT/Internet
Technologies
Healthcare
Technologies
5. Searching The Hidden Gems
IFS combines classical research with the power of online, social networks, and crowdsourcing to advance and
refine its investment themes and take advantage of developments that have ramifications for individual companies
or entire industries.
Understandably, during the past 15 years of financial volatility, investors have gravitated to a disproportionate
weighting in risk-averse strategies, including cash, bonds, high dividend yielding stocks, and passive portfolios.
Investors have associated change more with crisis and risk than with innovation and opportunity.
In absolute terms, the risk to performance during the next few years will be in not owning these stocks.
We are looking for the steam engine or the electricity or the computer of tomorrow: what are the general-purpose
technology platforms that are going to change the way the world works?
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6. Covered Companies Profile
Up to $1+ billion market cap (average $600 million)
Double-digit growth rate objective
Universe of 120 companies in the areas of:
Innovative technologies
Healthcare technologies
Public companies based in Georgia
Special situations/miscellaneous
Coverage started December 2014
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Although these companies are leading and benefiting from disruptive
forces, they are often undiscovered or misunderstood, falling “between the
cracks” of index-based sector strategies. IFS’ cross-sector and in-depth
thematic research strategy enables us to recognize these game-changing
companies before many traditional analysts.
7. The Saddled Innovation Curve
According to NYU and The Economist, the majority of innovative products has a “saddled” adoption curve,
where the early market comprises only 10-20% of total eventual adopters. Performance often levels off or even
dips following early enthusiasm. Despite a company’s potential, innovations can take longer for the mass
market to adopt. This phenomenon famously caused Steve Wozniak to doubt the future of the PC in 1985.
IFS identifies the potential of disruptive ideas across sectors to determine if a thematic setback and a stock’s
decline represent an opportunity to “cross the chasm,” or if they are traps. IFS actively researches positions
along the market adoption curve accordingly.
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9. The Saddled Innovation Curve
1. Early Adopters
Innovative companies often have long, flat adoption curves as inertia, network effects and lack of understanding
delay their embrace. IFS analysts work to discover these companies and understand their true potential market
opportunities.
2. Total Market
According to an NYU study, a majority of truly innovative products feature a “saddle” where performance declines
during the gap between the early adopters and mass market acceptance. This causes others to dismiss a company
because the traditional diffusion curve looks more like the main market, with only one peak before lasting decline.
IFS’ understanding enables us recognize if a firm is on the verge of “crossing the chasm” to large rapid growth.
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10. 3. Main Market
Many truly innovative products are flat in “winner takes most” markets. After the leading edge discovers the
product, network effects dictate that firms positioned to be market leaders have large and accelerating growth
once reaching the tipping point.
4. Mature Market
As firm realize the commercial success of their innovation, they must continue to evolve and differentiate. If
they do not continue to push the technology toward the next generation of the market, they will be dethroned
by the next disruptive technology. IFS monitors whether a company is reinvesting in future opportunities and
who might eventually then disrupt them.
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11. Industrial Innovation
Advancements in robotics and energy storage are transforming manufacturing and production in the U.S., bringing
jobs back to developed markets and restructuring our workforce while shaping the lives of generations to come.
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3D Printing Autonomous Car Solar Roadways
12. Subareas Of Industrial Innovation
Robotics
Additive manufacturing, which includes 3D printing, reduces costs, lead times, and labor necessary to produce
industrial and consumer products, empowering designers and enabling more complex and personalized
architectures.
Alternative Energy Sources
Alternate energy sources are transforming transportation, business activities, and industries of production, while
new methods of drilling and extraction have granted access to previously unreachable fossil fuel deposits.
Autonomous Vehicles
Mapping technology, sensors, and adaptive learning computers are paving the way for self-driving automobiles,
unmanned drones, and other autonomous vehicles to transform distribution, logistics, and coordination.
Development of Infrastructure
Technology is influencing the way we build roads and provide access to transportation helping to define the framework
for 21st–century manufacturing and distribution infrastructure in both developing and developed countries.
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13. Subareas Of Industrial Innovation
Energy Storage
Advances in energy storage such as cheaper production of lithium-ion batteries will allow for more efficient energy
use and allocation.
Innovative Materials
Smart, innovative materials that change properties and restructure themselves in different environments have the
potential to transform manufacturing and product development.
3D Printing
Advancements in sensor technology and artificial intelligence have led to the development of robots that can work,
adapt, and think, positioning industrial systems to become more efficient, accurate, and responsive.
Space Exploration
Technological advancements have enabled companies to launch private spacecraft into orbit and outer space more
efficiently, industrializing Earth’s atmosphere and revolutionizing global business operations.
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Industrial Innovation Technologies
COMPANY NAME TICKER SEGMENT MKT CAP
AEROVIRONMENT INC AVAV Special Batteries 621M
ALLIED MOTION TECHNOLOGY AMOT Motion Control 2004M
BOEING CO BA Aerospace 94.3B
CORNERSTONE ON DEMAND CSOD Software for Imaging 1.7B
EXONE CO/THE XONE 3D Printers 308M
FARO TECHNOLOGIES FARO 3D Software 939M
GENCORP INC GY Aerospace/Defense 223M
IROBOT CORP IRBT Robotics 1.1B
ORBITAL SCIENCES CORP ORB Aerospace 1.6B
PRGX GLOBAL PRGX Data Mining Consul. GA-Based 142M
RAVEN INDUSTRIES INC RAVN Industrial GPS systems 895M
REWALK ROBOTICS RWLK Robotics 296M
TESLA MOTORS INC TSLA Automotive 29.0B
15. IT/Internet Innovation
The Internet is transforming virtually every sector of the economy; immersing us in an entirely digital world; and
changing the way we manage data, purchase goods and communicate with the people in our lives.
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Cloud Computing Payment through mobile Smart Education
16. Subareas of IT/Internet Innovation
Cloud Computing
Cloud computing has transformed data storage, software, servers, predictive analytics and more into highly
affordable, adaptive, and accessible shared resources, accelerating the evolution of companies across sectors.
Big Data
Cheaper streaming and increased connectivity have fueled the explosion of data creation and collection, which
when properly analyzed has multiple applications across every industry.
The Sharing Economy
Born in the wake of the 2008 recession and leveraging the rise of mobile tech and social media, the sharing
economy – an economic model of shared access to goods and services – is changing consumer and business
attitudes towards renting versus owning.
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17. Subareas of IT/Internet Innovation
Digital Education
Online education, student performance tracking, and greater broadband access along with the integration of
tablets, smartphones, and multimedia digital textbooks into the classroom are redrawing education.
Crypto-Currencies
Crypto-currencies are decentralized digital currencies with the potential to revolutionize the $500 billion global
payments market, creating opportunities for currency mining chip manufacturers, new payment processors and
crypto-currency exchange.
Internet of Things
More and more devices – from household appliances to wearable tech, from medical systems to manufacturing
and shipping hardware – are able to communicate instantaneously over the Internet, potentially impacting every
aspect of day-to-day life and creating entirely new businesses.
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18. Subareas of IT/Internet Innovation
Social Media
The line between full-service social media sites like Facebook, micro-blogging sites like Twitter, and messaging
apps such as WeChat, continues to blur as these services explore ways to become the go-to, all-in-one version of
the old “web portal” model.
Devices/Gateways
Smartphones and tablets now connect us anytime, anywhere, both to the Internet and one another, giving rise
to an entire industry dedicated to apps.
Peer-to-Peer Lending
Peer-to-Peer (P2P) lending enables direct connections between borrowers and lenders of loans on a
secure platform. By avoiding traditional banking, P2P lending offers attractive conditions regarding
approval time and interest rates for both parties.
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IT/WEB Innovation Technology
COMPANY NAME TICKER SEGMENT MKT CAP
ALIBABA GROUP HOLDING-SP ADR AVAV On line Sales/Cloud 621M
AMBARELLA AMBA GPS systems 895M
CALAMP CORP CAMP Aerospace/Defense 223M
CHINA INFORMATION TECHN CNIT Media/Cloud Computing 115M
EARTHLINK ELNK IT/Network Services GA-based 454M
ECHELON CORP. ELON Internet of Things 75M
FACEBOOK INC-A FB Social Media 308M
LINKEDIN CORP-A ORB Social Media 1.6B
NET ELEMENT NETE Mobile Payment 64M
OVERSTOCK.COM OSTK On line sales/Criptocur 607M
RACKSPACE HOSTING RAX Software for Imaging 6.7B
RED HAT RHT Open Source Software 11.5B
SALESFORCE.COM INC CRM Cloud Computing 29.0B
SILVERSPRINGS NEWORK SSNI Smart Grid Networks 355M
TENCENT HOLDINGS TCEHY Robotics 1.1B
TWITTER INC FARO Social Media 939M
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IT/WEB Innovation Technology
COMPANY NAME TICKER SEGMENT MKT CAP
ALLOT COMUNICATION ALLT Intelligent Broadband 300M
AMERICAN SOFTWARE AMSWA Enterprise Software 256M
CISCO SYSTEM CSCO Networking/Internet of Things 140.6B
CONCURRENT COMPUTER C CCUR Video/Media Solutions GA-based 62M
INTERNAP NETWORK SERVICES INAP Internet of Things GA-based 431M
INVENSENSE INVN MicroElectronicMechanical Pr 1.35B
MANHATTAN ASSOCIATES MANH Prepackaged Softw. GA-based 2.9B
NUMEREX CORP NUMX Internet of Things GA-based 208M
PREMIERE GLOBAL SERVICES PGI Collaborative Software GA-based 496M
QIHOO 360 TCHNOLOGY CO QIHV Security for Internet and Cloud C. 9.1B
21. Healthcare and Life Science Revolution
Innovations in genomic sequencing are revolutionizing the way biological information is collected, processed and
applied, potentially restructuring healthcare, agriculture and pharmaceuticals and enhancing our quality of life.
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Wearable Chip DNA/RNA, Microbiomes findings Bionic Medicine Innovation
22. Subareas of Healthcare and Life Science Revolution
New Healthcare
New government regulations, the cost-saving benefits of cloud computing, and a growing need to share often
critical healthcare data across various locations, have led to a burgeoning market for cloud services and
electronic record-keeping among health care providers.
Agricultural Biology
Progress in the biological frontier will lead to advances in crop cultivation, genetically modified organisms
(GMOs), food security and bio-fuel research.
Beyond DNA
The sequencing of biological information beyond DNA, including proteins, RNA, epigenetic, and microbiomes,
lies at the heart of many nascent industries poised for revolutionary discoveries and exponential growth.
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23. Subareas of Healthcare And Life Science Revolution
Bioinformatics
Sequencing creates an ever-increasing abundance of biological data that requires specifically designed, high-powered
analytic and storage software to produce actionable insights.
Bio-inspired Computing
Biological systems have influenced many powerful learning algorithms and will continue diffusing into a wide range
of contexts, including cloud-based machine learning, artificial intelligence, and wearable monitoring technology.
Bionic Medicine
Advances in material sciences and robotics will dovetail with the ability to collect and process biological
information on a nano-scale to create a new generation of advanced medical devices and prosthetics.
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24. Subareas of Healthcare And Life Science Revolution
Molecular Medicine and Diagnostics
Rapid sequencing and analysis of biological data will fundamentally alter medical care, allowing for profitable
patient-customized treatments, and potentially shifting the paradigm of medicine from reactive to proactive.
Stem Cells
Stems cells will play a crucial role in pharmaceutical applications as well as medical treatment, resulting in a
high-growth industry based on the creation, cultivation and sale of stem cells and stem cell lines.
Instrumentation
Biological sequencing has merged with the digital age, creating unprecedented demand for sequencers and the
accompanying instruments, consumables, services, and workflow products.
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Healthcare/Life Science Innovation Technology
COMPANY NAME TICKER SEGMENT MKT CAP
ACCURAY ARAY Radiosurgery Tech 541M
ALIMERA SCIENCES ALIM BioPharma GA-based 260M
ATENAHEALTH INC ATHN Internet Services 4.5B
BIND THERAPEUTICS INC BIND Nanomedicine 102M
CASTLIGHT CSLT Med Benefits/Cloud Comp 1.1B
COMPUGEN LTD CGEN Computational Genomics 363M
CRYOLIFE CRY Medical Devices GA-based 282M
EVOGENE LTD EVGN Agri-Biotechnology 245M
FOUNDATION MEDICINE INC FMI Cancer diagnostics 654M
ILLUMINA INC ILMN Genetic Analysis 27.5B
MATERIALIZE MTLS Med/Dental 3D Software 468M
MAZOR MZOR Surgical Robotics 242M
MIMEDX MDXG Medical Devices GA-based 1.1B
MEDASSETS MDAS Healthcare Consulting GA-based 1.1B
NEWLINK GENETICS CORP NLNK BioPharma 1.0B
ORGANOVO ONVO Tissue Biology 502M
ROSETTA GENOMICS ROSG Genomics 29M
SANGAMO BIOSCIENCES SGMO Genomics 783M
26. Public Companies based in the State of Georgia
1. The State of Georgia has transformed from industrial/manufacturing to a service-based economy.
2. Bouncing back vigorously from severe depression in 2009, Georgia is the most dynamic state in the Southeast.
3. Ranked in 2013 in top 10 nationally by GDP, GDP growth, population and personal income.
4. About 20 companies in Georgia fit the IFS profile for research coverage.
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0 500 1000 1500 2000 2500
Georgia
North Carolina
New Jersey
Ohio
Pennsylvania
Illinois
Florida
New York
Texas
California
Gross State Product in $Billions
Top State Economies in 2013
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Georgia-based Companies
COMPANY NAME TICKER SEGMENT MKT CAP
BEAZER HOME BZH Home Builder 542M
CARMIKE CINEMAS, INC. OSTK On line sales/Criptocur 723M
CITY TRENDS, INC. RHT Apparel Retailer 368M
COCA COLA COMPANY KO Beverages 190.7B
COCA COLA ENTERPRISES, INC. CCE Soft Drinks 10.6B
CONCURRENT COMPUTER C CCUR Video/Media Solutions 62M
DLH HOLDINGS CORP DLHC Cloud Computing 29.0B
GRAY TELEVISION, INC. GTN Broadcasting 608M
HOME DEPOT CO HD Retailer 131.3B
INTERFACE AMBA Modular Carpets 895M
LOWE’S CO LOW Retailer 63.1B
MARINE PRODUCTS CORP. MPX Recreat. Boats 250M
NUMEREX CORP NUMX IT/Communication Services 208M
OXFORD INDUSTRIES OXM Apparel 1.1B
POPEYES LOUISIANA KITCH PLKI Restaurant 1.2B
PREMIERE GLOBAL SERVICES PGI Collaborative Software 496M
SAIA INC SAIA Trucking 1.4B
UNITED COMMUNITY BANK UCBI Commercial Bank 1.1B
28. Special Situations/Miscellaneous
A number of companies covered (using the same methodology and process) are outside our areas of specialization.
However, IFS might have a special reason to offer research coverage on these companies in the most disparate
sectors of the market, since that will offer differentiation and balance to our research product.
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Special Situations/Miscellaneous
COMPANY NAME TICKER SEGMENT MKT CAP
ACCURIDE ACW Automotive 225M
AMERICAN INSURANCE GR AIG Insurance 77.5B
BAYTEX BTE Energy 2.7B
BOEING ORB Restaurant 1.6B
ENERPLUS CORP ERF Energy 2.5B
EQT CORP. EQT Energy 13.2B
GLOBAL WATER GWGWF Water Utility 308M
KEMET CORP KEM Electronic Components 187M
LUXOTTICA LUX Eyewear 26.3B
30. Bespoke Research
We work closely with clients to provide timely research for customized and special projects on any
or investment aspect across the globe. Here our research approach is built around two
cornerstones: Bespoke Company Research and Bespoke Macro Research.
Recent examples include:
Analysis of S&P 500 sub-industry groups with the highest and lowest correlation to oil, the dollar
and emerging markets.
Providing a company report on a Scandinavian holding company with several private companies
in the portfolio.
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31. High Profile Private Company Radar
We monitor 50 private companies in the area of technology
innovation and provide summary research reports on them.
On a fee-basis, IFS can offer a comprehensive research report on
these companies in the last round of financing prior to going
public.
An example of our capability is the recent completion of the
Internet of Everything theme report while at the same time
preparing a report on JawBone, a high-profile private company
and leader in the field of Internet of Everything wearables.
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Name Type of Business
DROP BOX Cloud Computing
THIRD ROCK VENTURES Biotech VC
SQUARE Payment collection through phone
SNAPCHAT Video and photo message apps
BOX Online file storage
BRIGHT SOURCE ENERGY Solar Energy
KAGGLE Crowdsourcing private modeling
SECOND SIGHT Artificial retina
SAPCE X Space exploration and tourism
KICKSTARTER Crowdfunding
1366 TECHNOLOGIES Solar Energy
UBER Internet of Things
EVERNOTE IT tools
GITHUB Computer code sharing
XIAOMI Smartphone for LDC's
OCULUS Virtual reality headsets
AQUION ENERGY Power grid batteries
JAWBONE Wearable devices Internet of Things
VALVE open-source online games
SILURIA TECHNOLOGIES Natural gas conversion into automotive fuel
KAIIMA BIO-AGRITECH Non GMO technology
FREESCALE
SEMICONDUCTOR Wearable Devices Internet of Things
UPWORTHY Web content
EXPECT LABS Conversation analysis software
Name Type of Business
ETSY Artisan online marketplace
MOTIF INVESTING Online thematic brokerage
AEREO Cloud based antennas
MODERNA THERAPEUTICS Cells reprogramming technology
SPOTFY Digital music service
ZUORA Enterprise software for billing
CHARGEPOINT Electric charging stations
DATAMINR Data-mining on Twitter
SKYBOX IMAGING Hi-fi satellites
TRANSFERWISE peer to peer money transfer
PERSONAL CAPITAL Online personal finance
QUIRKY R&D innovation platform
PURE STORAGE Flash memory storage
WEALTHFRONT Online wealth management
FULLSCREEN Youtube video network
ECO MOTORS fuel-efficient clean engine
SHAPE SECURITY Cyber security
COOL PLANET ENERGY SYSTEM Clean fuels
PINTEREST Social media
ANGELLIST
Matchmaking between investors and
startups
ARCADIA BIOSCIENCES Crops testing
RIPPLE LABS Digital currency
WARBY PARKER Eyewear
Private Companies Monitored
33. Executive Team
Marco Bonelli
Director of Research
As Head of IFS Research, Marco Bonelli authors theme-based macro research and develops
institutional business, primarily on the equity side.
He joined IFS as Senior Managing Director and Head of Institutional Equities from C.L. King
& Associates where he built the international distribution network.
Prior to C.L. King, Bonelli worked at Northeast Securities, Raymond James and Cowen and
was ranked the largest producer at each firm.
Bonelli holds a Ph.D. in Leadership and Management from Alliant International University
where he focused his studies on Strategic Management Analysis as an alternative
Instrument for Stock Analysis. He also holds an MBA from the University of California and a
Laurea degree in Business Administration from the University of Venice – Ca’ Foscari.
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