Dr. Allan Evans & Unusual Machines Latest Developments ($UMAC Impact Stock)

Thank you. We figure this is a valid actual look for me. It's not AI. The background's real and it's a real event. So, I figured we just throw everybody a curveball. Treat them like they're an investor here at the show. I haven't even done my first meeting yet. So, this is my first meeting. Everybody gets to be part of it. You get to ask the same questions the guys who move money ask at the same time and I'm just going to answer them the same way.

Sure. If you look, we did the investment in Safe Pro collaboratively and we announced sort of a drone treasury strategy and they announced 150 million they were going to pour toward drone stuff. And so when you look I think where Eric sits as a capital markets guy and then where we sit as a parts vendor, if you look at Aerobotics they're way on the other end from where we're at. So there's not structural conflict between us but we come at it from one angle they come at it from another angle. And so us collaborating on lifting up maybe some of the underseen companies that we believe in helps us move this whole industry forward. So let's just take Safe Pro Group for instance. If we want to push sort of the American drone industry, Safe Pro Group's doing landmine removals. That's more parts that go into the American drone industry, more drone usage, more purchases in Europe or elsewhere as they try to get rid of the landmines in Ukraine, whether there's war or peace. And so right now we're in a unique phase in the American drone industry where there's a few hundred companies between hardware and software and everything. And I initially was talking to you about when I expected consolidation to occur. I expected it to start this November and Eric really made the first move to start the process a little bit earlier. But since we're consolidating to different segments or participating in different segments, it's much easier for us to work together as this winnowing begins to occur and really start to help with uplift in places where we believe we're going to make some money. And between the two of us, we have pretty good double checks and I think pretty good insight where I think we're going to get pretty good multiples versus other folks. So it's been good working with him. He's a real smart guy. He's a collaborator and so am I. So this is definitely rising tide lifts all boats. And we just want, we're in a place to help with the tide,

A million percent. So, you have an open marketplace. You have the snowball starting a little bit sooner than I thought. You have the government money coming a little bit later. Like we still really haven't seen the end of the year money contracts hit. Like I hear about them all. We know they're coming, but they're maybe two or three weeks delayed from my expectation. And you have two or three hundred companies in the segment, it's really going to collapse down to three to five, and that's a function of people getting together and really money, equity value and liquidity and everything else. And I think if you're not participating in that marketplace in the next three to five years, you very high probability being left behind. So, like I think of Glenn and Volatus, which I'm a big fan of. Glenn's a great guy. If they move to a senior exchange, I think they have a chance for the awareness and everything else to put them in a stronger position, but I think what they're doing is obviously impressive enough that I think there's a very good chance they'll be part of consolidation one way or the other, right? I think somebody go look at everything they're doing and be like, 'All right, we'll pick this up.' And so really from my perspective and he's able to do it, he may end up being a bigger part of the end story, but I think he's going to be part of the end anyway because they do really good work.

I think they did. He's just on the wrong exchange. Like his same approach if he was on the NASDAQ he'd be on fire it'd be him and Eric doing deals instead of me and Eric.

Yeah. I mean, the way why we all collaborate is we look at it and we say, 'Hey, look, the Chinese companies are so far ahead. If we start fighting now, we'll never get there.' And so when you remember what you're really trying to do, which is in our case build a globally competitive ecosystem rather than something that's just a moment of time, it makes it a lot easier to go back and be like, 'Yeah, we should probably play nice and not be redundant or do anything else, right? Like let's figure this out real quick.' Well, we sort of owe it to in a lot of ways the American people for supporting legislation that's created some of the drone restrictions that even allow the market to exist in the first place. And so we take that pretty seriously where we're like, 'All right, we got to get there.' And because people gave us an opportunity to get there and not stop and think that we're special or unique or anything because the second stuff like tariffs go away or the regulations that kick out Chinese drones, like we all get smoked again. So we still have to cross that gap and the fastest way to do it is collaboratively.

Sure. And let's I'm just going to assume some people don't know what an ATM is. And so an ATM just says the company can sell stock into the free trading market. It's not the sale of stock. It's not anything else. Where otherwise you have to do like an offering which is where you see the big chunk of money sell to private investors at a discount. That's what most of the guys here are looking for. They're looking for that discount. They're looking to come hunt and we put that ATM out there and we've always said we plan on staircasing our financing. So we haven't sold any more shares. We did our last round at 970. We're trading around that right now. We're not interested in selling more shares till we can staircase this for the longs. Like we have a ton of money. Our burn's really low. So, we've set it up so that we don't need it. We just wanted to broadcast to everyone that no matter how well this goes now, if we're going to continue to staircase at a substantially higher price, there's not going to be the surprise drop, it'll just be in the open markets at a 2% discount to market or whatever it is to sort of take away the financing fear. And again, I'm in my 40s, right? My early 40s. I can't say, 'Hey, we don't expect to raise money below this and then have it show up on the next quarterly report because it shows up on every quarterly report.' Like, credibility is like a piece of paper. Once you light it on fire, you can't get it back, right? And so really, we're set up to do that. We expect some really good news, which should also be an indicator of that. Like, you don't put something like this in place to say, 'Hey, we're not going to go after institutional money and give them the sweetener they want.' We believe that we're going to be able to staircase this just in the public markets. Like what do we have to be internally expecting to say that? And in this case, that's an accessible vehicle for about the next two and a half years. And so now for the next two and a half years, people don't really have to be concerned about every time something good happens, us continuing to do what's necessary, which is bring in capital, scale this thing because consolidation, etc. but in a way that can be disruptive to what is like the swing trade or the retail investor.

I think when you look and it also opens up a few real weird tools for us. You know like one of the things we were discussing and we have no idea around any of this so nobody take this as a leading indicator but we the Safe Pro Group stock like as an operating company we can only hold so much of our asset value in non-cash or government bonds and so what if we really believe where Safe Pro is going up we hit that 40% limit. Okay, instead of selling it, can we dividend it out now? And if we can dividend it out, then we can use the ATM to recover the cash so we don't jeopardize our balance sheet. So, it also opens up some really interesting optionality for us on the investment drone thesis side where we instead of getting jammed up and having to go do something that could work against the intent of our investment thesis, there's now some other possibilities there that, you know, we're not in the space that we're considering yet, but we're setting up the tools so that we can consider them if you want to,

Yeah, that's what everybody like at this conference would call an ATM. Good housekeeping because it's not a raise or anything. So that phrase is sort of industry jargon for sure. And I understand that there's a lot of nervousness because people look at the number which is our entire market cap and they're like that's absurd. It is absurd. But if we expect a market cap of, you know, with a B behind it, then it's not absurd.

Absolutely. I mean, why not think big? Why would you want to think small, right? I mean, this is a market I don't think anybody really understands I don't think I even really understand how fast and hard this thing is going to go.

I have a new analogy for the marketplace. Just came to me. The drone market just had a whole forest fire come through and destroy everything. And now you see a whole bunch of small trees and they're trying to grow. And it doesn't matter how fast you grow. It matters if you grow faster than your competitors because only the tallest trees end up standing at the ends. And so when you look at what we're trying to do, it doesn't matter if we're growing, it doesn't matter what we're doing. It matters that we plan on being one of the tallest trees, right? And so you're seeing all these small trees, after the fire. And now you're placing bets not on what tree's going to grow. They're all going to grow. There's just a forest fire. It's awesome. But there's like 300 of them. And there's only going to be, you know, 20 that are going to grab all the sunlight because they get up faster.

And so we're not in a race to grow. We're in a race to be one of the 20. And that's sort of where all our planning, all our structure, all our everything. Where we lean into. And that's really where the big winners in this marketplace are going to be are those trees at the very end. Now, people can make money on a whole lot of the trees right now because they are all going to grow, but the real winners are going to be the ones you think are there at the end that blot out the sun for everyone else.

That's who's going to have a problem, right?

Like no. No.

It is. It is. And really coming in and everybody getting longer is how it works. But the momentum feeds itself and the gravity builds faster. And so, if we're not super aware and continue to build that gravity and understand that it's not how fast we're growing, it's can we be one of the tall trees. But then everything you see us do is designed for that, not for how much we grow today, because the marketplace is like the weather, right? Is it raining? Is it cloudy? That affects all the trees, right? And so we're not here to fight the weather. We're here to be a tall tree.

I mean, I talk to AI literally every it's my best friend now. I every day.

It's a critical thinker. I mean, if you're not asking, you can ask AI how AI can help you. And here's my world. How can AI help me? And if you're not doing that, I don't know, man. I think you're gonna get ran over.

Yeah. And where I personally use it quite a bit is it lets me get to drafts of communication much faster. Right. I go in and rewrite it and everything, but it'll give me a framework.

For like a team letter or whatever else. It makes sure you cover everything, you know. But again, we joke we call the AI like the interns. It's like having a million interns. And I think having a conversation with an intern can sometimes be really interesting. They bring stuff you'd never think of.

But it's still a million interns or I'd say critical thinking and development.

To me, it just streamlines things really well. It makes you kind of focus on the critical things. I think it just it does and you don't waste cognitive cycles on repetition, right? Like I don't have to think about what an outline for a letter would be. There's a really good outline and then with a few more conversations back and forth, there can be an outline for the exact letter I want to write and then I can go in and put in my own data, my own thoughts, my own critical thinkings. But I didn't waste all the brain power on the construction of it or we just did some quick video edit clips using AI and like 15 minutes in there's 90% of the video you want, right? And it's the theme and everything else and now you can go do the last chunk of polish. So when you look at a lot of what we do, the efficiency, time efficiency of the people doing it gets better and their skill sets get to be used for really the most powerful things that they do. The critical thinking, the real artistry, the narrative flow, kind of all the parts that are where people generate the most value. So, in that way, I think from our end, it's sort of incorporated. Now, we do a lot of physical goods. We're not going to have an AI tell us how to wind a motor, right? It might come up with some crazy ideas. And so there's a lot of times ancillary reasons to do things a specific way, but I definitely again it's like having an army of interns, you know, and if you use interns, well, they're huge value multiples. Now, if I could just get the AI to bring me a coffee, but it'll happen because I could use one. We're not that far away, but I don't get it. Let's get fired up.

Couple months.