 And with him is the HZO, and hi, so who are you? So I'm Steve Gold, I'm the Chief Commercial Officer for HZO. We live in a world of electronics, which doesn't really surprise anybody, but what's a little bit unusual is that by 2025, there will be over 41 billion connected devices. Now, not just smartphones, certainly that's one of the best understood connected devices, but everything from autonomous cars to factory 4.0 to offshore oil rigs, and we've become so dependent upon electronics that durability, reliability, and stability has become of pivotal importance. So what HZO does is we protect the electronics to ensure that they can stand the test of time and stand up to all of the basic elements and challenges that we find in the industrial setting. This is through thin film coatings. These are super thin coatings measured in nanometers. Just to put it in context, a nanometer, a piece of paper is about 100,000 nanometers thick. So when I say super, super thin, these go over the electronic and ensure their integrity. They prevent water and other environmental conditions from penetrating the board. Now we've all seen what happens when water comes in contact with a battery or coin. It immediately starts to degrade, it starts to corrode, and that compromises the electronics. Now if it's our smartphone, that represents a cost to us as an individual, it's certainly inconvenient. If it's the electronics within an automotive device, that could actually put life at risk. If your autonomous vehicle ceases to operate due to the fact that the electronics has been compromised, that's a serious, serious condition. So HCO really is out there protecting what matters most to you, to our audience when it comes to what's critical in the electronic arena. So right here it says 41.6 billion by 2025. So how many of those 41 billion have you shipped so far? I'm joking, but what's the status? Yeah, so probably one of the most unique things in what we do is the fact that the technology itself, the chemistry has been around for decades, but what's changed in the last couple of years is the scale at which we can operate. So today, on a typical program, we don't just protect thousands or hundreds of thousands, but literally have the capacity to protect millions of devices per day. And so we literally are keeping up with the growth in the electronic arena. And that's really what's different, the ability to operate at scale, the ability to provide a turnkey solution. So we bring together the people, the process, the material, and the equipment. And in doing so, we literally deliver an outcome, and we're able to dial that outcome in to the specific requirement of the electronic. So you have capacity for millions per day? Correct. That's a lot. That's a lot of capacity. Millions of what? Like anything? It could be a circuit, it could be a chip, it could be an assembly, it could be an entire device. So it really comes back to what it is we're trying to protect and what it is we're trying to protect from. So how much of a no-brainer is this, because why make something that's not waterproof? Is it just a question of cost? Why people might not do it? Is it affordable? So, you know, I think if you look at our industry, the way people have thought about protecting electronics is a bit dated. They've thought about how do you keep water out of a device? The problem is water liquids are insidious, they have a way to find their way in, and once they're in, they're trapped, and once they're trapped, they begin to affect the operation or the integrity of the actual device. So we're seeing a bit of a sea change from the traditional way of what we call ingress protection, trying to keep liquids out, to try to really address what happens once liquids get in. So we actually protect electronics from the inside out. We actually protect down to the circuitry level to ensure that integrity is maintained and that device will continue to operate not just for days and weeks and months, but literally for years to come. Is there any reason whatsoever not to work with you on everything, because do you hinder in terms of the electronics, the efficiency of something, or nothing is affected? No, I mean there is nothing in our process that affects the functionality of the electronic. Or the efficiency. Or the efficiency, and in fact we actually have the ability to dial in materials to ensure not only the protection, but the thermal characteristics, the abrasive characteristics, the dielectric characteristics. So we literally match the requirement to the chemistry and then we provide that outcome. Nothing overheats because of this? No. It does not. Because it's super thin, it doesn't add weight, it doesn't add bulk, it doesn't affect tight tolerances, actually that's an advantage. Traditional mechanisms to protect have all that baggage that comes along with it. Since you go inside the device, why not just have kind of like water flowing in there as a water cooling or something like that? Yeah, I mean it does, and in fact ultimately nobody likes to challenge the device itself, but to your point, and you can see from the demonstration, these electronics operate literally flawlessly why completely submerged. So not everything needs complete submersion, some are just splash protection and water resistant. The coatings that we apply are of the highest integrity when it comes to serving the respect of need. So in terms of your company based and where are you based? We're based in Raleigh, North Carolina. And then the company is now eight years old? So the company was founded in 2011, we operate through 14 locations. We have manufacturing capabilities in Europe, US and throughout Asia. Today we employ a little over 4,000 workers that are providing these protective coatings. So when we start talking about scale, we're talking about a highly automated process and so as we start to bring the people in, it kind of gives you an order of magnitude of what kind of capabilities and volumes we're working with. And so 14 locations, you have the important Asian ones? Do you have Shenzhen? Of course, of course. So throughout China you're going to find us in the North and Way Fong, in the South and Shenzhen, in the middle and Zhengxi. You're going to find us in Shanghai and Kunshan. So we have a large footprint and presence even in the extended areas of Taipei, moving into Vietnam. We literally are where manufacturing happens for our customers. So can a customer, a startup or a company doing something really cool just call you up and say, hey, I'm bringing over 10,000 PCBs, can I put them in your oven and then you say no problem? Sure. If you have space? Yeah, in fact, one of the things we encourage customers to do is sampling. It's to test, rather than take it at the theoretical level or the collateral level of confidence that it works, we literally encourage them to do sampling, where we will take the component, the chip, the assembly, the part, and we'll put it through the process and so they can then perform their own functional testing, their own reliability testing and get their own confidence as to the quality and benefit of the coding. Do you have some kind of camera system and sensors that are using AI to analyze the device and say you need this much coding exactly to this performance or do you just have like, how do you know how good it codes? Yeah, so a couple of things, when it comes to the process, our intellectual property portfolio is about 350 assets. So this is a highly protected, patented process of experiences and learnings that we've been able to incorporate into a unique value proposition. So when we talk about putting codings onto various devices, assemblies and components, we're doing it with the knowledge of ten years of operational history and excellence. We know how thick to put it on, we know the conformality of the coding, we know the characteristics of the coding, and we do use data, analytics, artificial intelligence in a variety of ways to analyze the data and the output to continually fine tune our own processes. Because you might need to have a different recipe for every device based on the weight, the size and everything. Yeah, and that's a great analogy because you think about a recipe, it's basically a set of instructions but you want to fine tune it to the individual taste in the case of a recipe to the audience and that's exactly what we do. We take a proven process and practice and then we fine tune it to the application to provide the ultimate solution and protection. So I like to do videos with companies that do nano technology stuff and you're definitely one of them, right? We are absolutely one of them and as you appreciate in the world of nano, you're dealing with next generation technologies at a sub microscopic level and that is exactly what our coding is. But many times it's conceptual, it's like research, but you are actually shipping tons of this stuff or is it tons or is it so thin that it's not tons? Well I think the way to think about this is we literally are doing what was theoretical years ago at commercial scale and I say commercial scale not ones and twosies but again moving into the millions and hundreds of millions of type of devices. So in terms of material consumption it's still super thin, super light, but it's next generation and it's not just a material, like I said it's a diversity what we call the spectrum of protection and it's a combination of liquids, gases and solids that are brought together very prescriptively. Liquids, gases and solids. That's what you have in your system. That's what we use to basically mix the ingredients to provide the proper level of protection on top of the device or circuit board we're protecting. But what is the material do you say or is it secret? Well it's a blend, it depends, I mean it's everything from the tried and true proven chemistry of perylene through plasma processes involving various carbon-based, fluoride-based, silicon-based materials to next generation, metal oxides. So it really depends that there's well over 20 different materials we use today, an equal number that are in the R&D lab that we're formulating. So I know I heard about this thing called H2O, but is this some kind of material, the HZO or not? It's not, actually it's a little bit of a play on the notion of H2O and the company was originally founded by a group that not surprisingly Z was an integral part of the name. But I think today it really does personify this notion of how do you protect from liquids and obviously the most common form of liquid is water and so I think our customers do resonate with the name. So you have how many people in North Carolina? So our headquarters in North Carolina is a little over a hundred folks. Do you have like material researchers that kind of like search and find new materials that are good for the nanocoding? We do. In fact we have a basic staff level of PhDs in the process areas like plasma and nanocodings in the material science areas, different chemistries in the equipment area, all of the equipment we design, develop and we build and we do that specifically because what's available in market isn't sufficient to maintain the level of quality and protection that our customers are demanding of us. One thing that I've noticed when I go to China is that many times they're, I don't want to say cutting corners but every cent matters in the bill of materials to, that's where they need to get a profit sometimes. So you have all kinds of packages in terms of pricing I guess, right? We do and it really depends on the industry. If you think about it, you know we work within the consumer electronics industry, IOT, industrial, automotive, medical devices and what motivates them to protect is a little bit different. And consumer, you know, obviously customer experience and durability are important and what's at stake, you know, deals with, you know, cost avoidance. You don't want something coming back, being returned a warranty claim, you know, so you kind of offset the cost of coating with, you know, the cost avoidance. If you move an automotive, it's about liability. If an electronic fails an automotive, you know, potentially somebody could be hurt if not, you know, compromise life. And so there, right, you're looking at a very different motivation when it comes to adding cost to the bill of material. It's far secondary to the benefit being delivered. And then in other markets, it's all about the ability to drive net new revenues or more revenues. So coating we know, IDC reporters came out and said that the average individual, you and I, would pay more for a smartphone that they knew was truly protected. How much more? $70. So the question is, would you add a little bit of cost and coating, pennies, to get $70 more in resale? Of course you would. The ROI on that is incredible. Pennies. Pennies. So you and the pennies. So it should be a no-brainer, right? Even for the most cost-conscious, cost-cutting shins and startup that does some kind of device, they shouldn't even say, consider saying no, it's just pennies, right? If you care about the consumer, if you care about your business client, that is a no-brainer. You have to do this. And there's no better way to do this, because there is maybe one or two competitors, right? You know what? The landscape, there are different ways to approach protection, but nobody has brought it together in a way that provides an outcome like HZO. No one, you know, can operate the scale that we operate at, which is truly unique. And honestly, no one has the track record. We've been doing this for a decade and, you know, we have proven ourselves time and time again in terms of the quality of coating and reliability. When I see all these reviews, some people talk about this stuff called IP67, 68, you know, you provide the whole range of all these IP solutions? We do, we do. And I think when you think about IP, IP has table stakes. And I say that because it's insufficient to protect something from the challenges of what most devices will experience out in the world. So for example, IP, it's all about testing with clean water, wouldn't it be nice if the only challenge we had was clean water? But we have oceans with salt, we have pools with chlorine, you know, we have other substances, petroleum products, acids that affect electronics. And so it's critical that we move beyond the IP, the increased protection. It's critical that we think about what that next standard really looks like. So yes, IP is important, it's table stakes. But as a consumer, as a professional, I can tell you it's not sufficient to give me the confidence that my device is truly protected. So you go to higher than what regular people do? We go well beyond what the conventional thinking is around the standard. You call it IPX, oh no, what is the highest rating? Today the highest rating is IP68. But again, that's only dealing with clean water, it's only dealing with a limited test time and duration, and it's only dealing with brand new products. And I'll give you a great example. My product out of the box behaves differently. If I could get a smartphone out of the box, there's no scratches, dings, dents, I've never dropped it. Over the course of weeks, I sit on it, the phone flexes, it bends, it becomes compromised, it no longer is brand new. And this is where the next evolution of standards come into play, right? I've got to protect things for the way life happens. And the current standard isn't looking at that phenomena. So you above IP68, and you said IP68 is the highest? It is the highest. And you above it? Correct. You are like throwing it in the pool and don't worry. Correct, we're testing to that next standard. I actually like to say we're testing to what happens in life. Whether it's the pool, the pond, whether it's the ocean, whether it's the factory environment, whether it's the harshness of a remote area, an oil rig, or drilling platform, it doesn't make a difference. That device has to stand up. And we talked about 41 billion devices connected by 2025. Only 4 billion of those, 10% of those are smartphones, which is what we kind of equate to internet of things. Most of these devices are things that we never think about, but that we have to depend on. They're things that reside at the edge, edge computing. Well, edge computing doesn't work if the device fails. And so protection is critical and integral to keep oil flowing, cars running, planes flying. Electricity is working. Case maker is running. Electricity in smart grids, smart cities, smart homes. Think about cameras and video doorbells. All of these things are electronic and they're connected and they need to be protected. Does it help with the short-circuiting not happening? It does, because you don't have the corrosion. So you don't get that short. Anti-corrosion. Corrosion costs trillions. Absolutely. And you have a solution for that. Yeah, and if you've ever looked at corrosion, corrosion doesn't just happen in years and months. It happens in seconds. Electronics are almost immediately compromised when exposed to the elements. And so this is actually extending that life and the reliability of that device. So 2,000 years from now when the next Tutankhamun cave gets discovered, all the electronics in that cave are going to be pristine. How long this is going to last? Yeah, so is it like forever? It's a great question. And it really is a byproduct of the material. But if you take a look at like periling, when we talk to automotive manufacturers about periling, their expectation is a minimum of 25 years. So we can tell you that this material stands the test of time. And again, it should be dialed in to the life expectancy of the product and then beyond. So if the life expectancy of a product is two years, you probably don't want to go to the expense of protecting it forever. But we certainly can help you on either end. So why not just code all the parts in the car? Well, at the end of the day, it comes down to cost. Well, you know what, I would tell you it makes sense to code the critical parts. Like anything, could you create something that lasts forever? Sure, but there's a cost trade-off to do that. So I would certainly present that anything that has critical dependency needs to be protected. And I think the automotive companies are doing that. I think the medical device companies are doing that. I think we're starting to see uptake and adaptation and IoT, the internet of things, more and more of the industrial companies are doing that. By the way, the consumer companies get it. As you stick things in your ear and sweat happens, sweat is highly corrosive. And so it's critical to protect those things from that. And when you talk about IoT, you want to leave stuff out in the rain and it just be fine. Yes, that's correct. And even big rain, big storms. Big storms, big winds, big rains, flooding. And you're good. And you're good. This protection can handle that. All right, so no-brainer kind of, right? It's a no-brainer. And so I guess your market is growing very fast. It is. We've enjoyed, obviously, the proliferation of electronics in society has been a driving force to the adoption of HCO and our technologies. And HCO I think has been able to capitalize and demonstrate in a very unique way that its coatings and its process, its approach provides a level of value that is unparalleled and candidly unprecedented. No one's ever in history been able to deliver on what we do at the scale that we do it at.