Robert D’Loren: Yes. I’ve given this on some of the conference calls, we think stabilized royalties. If you run a model at about $8 million per year, over the 25 years, it’s $170 million plus in royalties that the license will generate. And I think that is a great place for us to land with that asset.
Aaron Warwick: Yes. I mean given the fact that it’s higher than your current market cap, if you look at the net present value or any sort of discounted cash flow on that, that’s extremely positive contract for you guys. I wanted to ask a little bit more about the social commerce side of things. It sounds like you said you should be ready to have that out before the holiday season. Is that what you said to the previous caller?
Robert D’Loren: Yes. We haven’t modeled any assumptions about the launch of the marketplace into our model. The investments have been made in the tax. So no spend needed there. We are working with some industry friends, in certain cases, industry competitors that are interested in joining the marketplace, because the technology solves a very serious problem in the industry today. Return on ad spend since the privacy rules have changed is becoming something that just is intolerable within the industry, a lot of e-commerce platforms are suddenly losing money. And with this platform, the return on ad spend is infinite because brand doesn’t pay until there is a sale. And for us, it’s a marketplace model, not a lot of risk in terms of operations.
It’s 30% of sales, we pay the influencers and then whatever our operating overhead is. And then, of course, it provides another channel of distribution as the audience grows in that platform for our brands and our celebrities. So we’re taking a read-and-react approach, we will get it launched. We will see how it begins to scale, like anything else in social media, we think we’ll have a good start with the customer base from the brands that have signed with us and with our own customers. And then, we’ll use what we learned over the first quarter after the launch to forecast revenues going forward.
Aaron Warwick: How many brands have signed with you? And what’s the nature of these types of brands? Are some of the household names? What should we expect there?
Robert D’Loren: Most of them are big brands, household names, big customer bases and we’ll be announcing who those are in connection with the launch. And we’re very excited about it. It’s been 2 years, a little more 2.5 years in the works, and we’re happy that we’ll be launching for holiday.
Aaron Warwick: And so I guess if you could speak maybe just a little bit about, how this is going to be differentiated from the current social media platforms and their model of business in advertising, would be helpful?
Robert D’Loren: So to really cut to the chase, it’s democratizing marketing dollars. It’s shifting ad dollars from advertisers to the people. The technology is, there’s a desktop application as well as an app application and for the user and what we’re really striving to do here is to turn the everyday shopper into a paid influencer. So the app is really easy to use. It’s as easy as creating a TikTok piece of content. And if the shopper or the influencer shares it with a friend or a follower and they buy, they get paid. So in many ways, it’s shifting ad dollars from the advertisers to the people.
Aaron Warwick: Yes. And I like how you highlight. I know I hadn’t thought of it before. I guess how the brands don’t have to pay until something is sold. So I guess they’re paying the influencer once an item is actually sold, but nothing that they’re paying them in advance of that. Is that correct?
