Bright Things is the developer of a games comsole and software for the pre-schools market. It has reached agreement with Bondai UK for the exclusive distribution rights of its educational games console. Bondai has guaranteed to purchase 100K consoles and 200K units of associated software in the first year of a 3-year agreement. Bondai's quote is: "We are very pleased to be associated with what will prove to such a high profile property in a competetive market place. The TV titles which are already in place, and many more in the pipeline for future use, will give the 'Bubble' games platform tremendous appeal to young children'.

BGT are Play of the Week (26/5/05). Good write-up that gives useful info. Quick summary:
- recounts things that could go wrong: technical problems delaying launch; parents don't like the look or think games too expensive at 17 on top of 50 console price;entry problems into US/Europe; impact of competition shortening product life. Nothing there to worry.
- team's terrific track record with Eidos
- easy to use with few buttons and infra-red link to DVD
- games only cost 150K to develop; clearly that's where BGT see money being made; 6 games available at launch plus 10 titles per year
- losses in first two years then PE of around 10 in 2007 then ballistic profits until a 'buble bursts' due to comeptition or boredom.

Really helpful piece written with an element of caution. Only looking for sp of 150p in under a year. Funds raised at 150p so institutions will be looking for more. As a Grandad, I'll be buying one and reckon this will really fire the imaginations of parents and be a must for Play Schools.

Jules

Thanks for the introduction. Its good to have a really good margin after one day! Do you reckon that a Bubble would be worth 50 to BTG. If so, 100K in year 1 would mean 5m, quite a lot of which would come through to the bottom line. Base this on thinking that it is a DVD player plus screen and computer. Could sell at more than 100 but that would then limit the take-up as a pre-school educational toy. Mind, it must be a must to have several in a play school. The shape of things to come. Suspect I may have to accumulate!

Eric

ding dong... BGT...again:-))

Jules

You didn't attempt my question on the likely cost of a Bubble - very significant in forming a view on the movement of the sp. Any ideas? I do agree the ding, dong bit! Added a CFD today.

Eric

Difficult to see why the price jumped today. Even given that two early trades for some 26,000 or so were buys rather than sells that would just bring matters back to even stevens.

Looking back to the jump in Janaury in the sp. The second part of that was occurring during the week of the London Toy Fair when Bubble was being unveiled to the trade for the first time. The launch is not until the summer but I expeect Bondai are lining up sales whilst BGT themselves finish the programming and compelte development generally. I imagine production is sub-contracted - can someone confirm? The 'toy' will be very much in the children's eye and there fore the public's when it is launched and, with assured volumes through, Bondai, I expect the sp to roar to highrer ground. Will probably tuck away a few more from time to time.

Eric

The BGT bubble will be on show at the toy fair this week. It is retailing for around 59 as far as I understand. Has had a retracement today due to announcement of a placing... Pretty sure that this will be lapped up and that the price will not be much lower than the bid price of 166.. So will show good support for a share that will have risen over 100% in the last few weeks. I am looking to add alot more as this concept should have a great deal of appeal and is beginning to get the city very excited as the guys who run it are very well respected annd tend to deliver what they promise (so I have been told)
This bubble has no wires and is geared for preschool children. It is an interactive game which only needs the use of a dvd player or playstation or xbox. Children can watch their favorite programmes which range from teletubbies, to thomas the tank. (You name it BGT have the rights to use it) When their favorite character asks them to do something , they can , so the kids feel part of the action. It is also aimed to be educational , teaching the kids through their favorite programmes basic concepts that children need to learn. Think the potential is huge. Know of some kids who trialled it and it was a HUGE success with both them and the parents

Jules

An absolutely brilliant post. Worth repeating on the ASC Challenge thread as it is general interest apart from the investment opportunity; also a service though to the guys and gals there as the investment opportunity is a very good one. 59 is a bit less than I thought but that will mean the volume should be much higher. Take out VAT and you are back to 50, halve that for mark-up to 25, take out Bondai's half, say, and you have just 12.50 back to BGT. For the first order of 100K that is 1.25m. Against that you will have costs of another half so we have a contribution of some 600K. perhaps 1m pbt in first year or a pe of 25. But what's the market? Every pre-school group. Should become a must have for most families with young children so we could be talking about a million units in the UK alone quite quickly. The palcing will overhang for a while but the very fact of tehir confidence in raising funds at close to the market price indicates that the investment case is strong at current prices. Will definitely top up. Are you sure the toy fair is this week. The Bondai annoucement referred to the Toy Fair this week and that was 24th January.

Eric

I know EW, but apparently there is another toy fair.. or have I misunderstood?
Now you mention VAT, I am not sure that the price includes or is excluding VAT

EW... hope you are watching. They have closed the spread. Think wins may have twigged that he may need some stock if the placing has gone quickly:-)

Expect there are several toy fairs, so that's the answer. A price of 59 (or 59.95) would be quoted to include vat but its not relevant to back of the envelope calculations. Does that include software? - Bondai contracted for twice as much software as hardware. Glad the price is not too high to put off cash strapped families - within most families range. The peer group pressure amongst play group children will be intolerable. Obviously will have to top up in the morning. My gut-feelings are getting ever stronger. Thanks for doing the post on the Challenge bb (and for 'admitting' you're a girl!) EWR

Nice few buys in bgt today after placing announcement yesterday... plans must be close to being finalised!

Jules: just waiting a wee while for them to get the placing done as that might hold the sp for a few days. Other exciting plays around. I hope you picked up moneyplus's GMC hint. Up 20% on my first day! Hoping she doesn't hear as it wouldn't do for her to be jumping about on her new knees. I expect there will be a steady news flow before long so best not to hang around too long. This is my "moral" play to offset GMC. Mind the good book talks about " making friends with the mammon of unrighteousness" so think I'm covered.

Eric

Eric... certainly did get into gmc.. close for 40% profit and got into tou which has a large gap to fill.
BGT.... don't wait too long... Think you may find it will move quickly when the placing is announced near the current price.. Placing will be gobbled up by funds... and that is not a ramp!!!

Jules: you'll be pleased to hear that I have topped up with a CFD for 6000 at 167p. Reckon the placing, which should be a doodle, will set a support level at about current sp, so its one way traffic from here. Never been able to turn down a maiden's plea! Notice the trade is not shown: CFDs sometimes are and sometimes not; clearly can change the picture.

Eric

EW... well done..... have a feeling that the placement was oversubscribed to at these levels...hmmmmm:-)

Nice move up by BGT after placing at 1,50 which was well overscribed. Chart looking ripe for a move up. If you thought I was joking about a ten bagger, then berate me in a year's time:-)

BGT really running today... just the beginning

Jules

Great! Missed the over-subscription. It would explain the rise though as some had to buy in the market. The references to the reason for funding seem to concentrate on software and launch: this seems to suggest that the physical compnents are standard buy ins - is that how you see it? What's the basis for your 10-bagger claim? I will accept 'feminine intuition' as an answer! My 'mere male intuition' tends to agree!

Eric

Where are you, Jules? Never answered my last question - naughty girl! Surely you haven't left you first love - BGT, that is, not me!

Eric

EW hmmmm I thought I had answered it...must have pressed the refresh button instead of post reply.... Sorry!!
No I haven't left BGT, infact I have added to my position on the real world.... but also remember I never fall in love with a share.If the chart goes against me I shall be out... That is how I make my money. At the moment it seems ready for another upward spurt... We shall see!!!
My ten bagger claim is based as you said on female intuition. Having had 3 children, I feel this product will be a sure fire winner in this busy world for mums as she can get on with her job whilst they are being interactive with an educational DVD. The Japanese already like it enough to pre order, The Americans are showing large interest etc. When this hits the market in June/ July then we will certainly get the fuller picture:-)

Taken from an article on bgt website... (30 April 2004)

http://www.brightthings.com/press.html


"The console, which has a clip-on fascia that can be changed as children grow, will probably be launched after Christmas or early in 2005. It will probably be sold in toy stores and video games retailers for about 40 pounds -- substantially less than the price of existing consoles. The games will cost around 15 pounds each, again less than games aimed at teens and adults"

Don't know if this has already come to your attention or maybe its irrelevant and has been superseded by some more recent news, but if the "clip on fascia" costs 40 pound and the price of the existing console is substantially more, is the sixty pound mark a bit conservative? Also interesting to see the games will retail at around 15 pound.

Any thoughts?