Daniel Goldberger: Yes. So very good question. And going forward, we need to do a better job of explaining what’s going on. There are some pictures on the TAC-STIM, www.tac-stim.com website of the new military grade version of our noninvasive vagus nerve stimulator. That’s a very rugged MIL-SPEC implementation of the technology that was largely finance — the development of that product was largely financed by the Air Force Research Laboratories at Wright-Patterson Air Force Base. Completely separately, we are developing a platform for our, let’s call it, civilian applications of vagus nerve stimulation that’s going to be connected via Bluetooth to a smartphone. The DoD specifically does not want smartphone connections for all their various security reasons.
So these are physically different products for different end users that are both fundamentally noninvasive vagus nerve stimulator. So I hope that’s helpful. There are better pictures on our various websites of the different product configurations.
Swayampakula Ramakanth: Okay. And then I’m sorry, I’m flipping back and forth. Then going back to the VA channel. Since the COVID ended, I had to be careful it might be coming back. You have had more interactions for the VA centers. So is the depth of your relationship with individuals at the VA increasing? And how much of that you have already recognized and how much of that is still on the table?
Daniel Goldberger: There is a tremendous amount of runway ahead of us, both in terms of the number of facilities that we have opened up and within any given facility, the number of departments that we have opened up. We generally start with neurology in any particular facility. Behavioral health is very interested in what we’re doing, especially around PTSD and substance abuse. We have access now to women’s health to pain management and in some cases, we’re now getting into primary care in the VA hospital settings as well. So we have tremendous forward opportunity not just to open up new facilities, but to go deeper into our existing customer facilities.
Swayampakula Ramakanth: Okay. One last question for Brian. So this quarter, you clocked 84% as gross margin. With the second-generation product coming up on the TAC-STIM business, and also with, at the same time, increasing in terms of volume of product leaving your facility, how should we think about gross margin, not just for ’23, but in the short to midterm from here?
Brian Posner: Yes. Yes, so I think we’re going to — we’re pretty comfortable saying we’re going to stay over 80%. We’ve been over 80% since late 2021 at this point. excluding onetime adjustments from time to time. So I think we’re very comfortable that we’ll be over 80% for the foreseeable future.
Operator: Our next question comes from Nick Sherwood with Maxim.
Nick Sherwood: Congrats on the quarter. Can you give us any information on some of the demographic data that you — or metrics that you’ve gotten from your e-commerce platform and digital marketing initiatives, sort of like which social media platforms you’re driving traffic from and what sort of customers you’re seeing that are coming in from these digital marketing initiatives?
Daniel Goldberger: Yes. Very good question. We have not given out much of that publicly. One of the metrics that we do watch carefully is we call it, the media efficiency rate. What do we spend on — what we spend on media, which is overwhelmingly Internet versus the revenue that we’re generating. And we’re solidly — and I think we said in the call that we’re spending $1 on media to generate $2.20, $2.25 of revenue, which is very scalable. The vast majority of our spending so far has been on [indiscernible] and you can see that in the Google Analytics. We engaged an agency to help us with social media to develop creative material for us. That agency just started to come online in June and July. And so candidly, our social media metrics right now are anemic, but I’m looking forward now that this agency is kicking in to seeing some of that social media, Facebook, Instagram, TikTok.
