SideChannel ("SDCH") March 2024 Investor Newsletter

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SideChannel March 2024 Investor Newsletter

Investor Relations Newsletter for Current and Prospective Shareholders of SDCH

Note from Brian Haugli

CEO, SideChannel

Our concerted push towards achieving cash flow positivity has significantly strengthened our balance sheet, positioning SideChannel more favorably than many other OTC-listed and microcap companies in our sector. This financial discipline and strategic focus on generating positive cash flow are crucial for our long-term success and stability.

By ensuring that our operations are not just revenue-generating but also cash-generating, we have laid a solid foundation for sustainable growth. This strong financial footing enables us to invest more confidently in key areas such as our Enclave technology and vCISO practices, further differentiating us in the cybersecurity market. Moreover, being cash flow positive enhances our appeal to investors and partners, who are increasingly looking for companies with robust financial health and the ability to self-fund growth initiatives.

In the competitive landscape of cybersecurity, where rapid changes and technological advancements are the norms, our ability to maintain financial agility without relying heavily on external funding is a significant advantage. It allows us to respond quickly to opportunities and challenges, invest in innovation, and attract top talent, all while managing the risks associated with market volatility.

This strategic advantage is not just about surviving; it’s about thriving. Our strong balance sheet, protected by our commitment to cash flow positivity, sets us apart and positions SideChannel to win in the long term. We are building a company that is resilient, forward-looking, and poised for continued success, well ahead of our peers in the OTC and microcap spaces.

Note from Ryan Polk

CFO, SideChannel

A common question coming out of our last Form 10Q filing is why is growth slowing? 

In May 2023, we announced that we were implementing operating expense reductions. Since, then we have eliminated and avoided $1.2 million of annualized operating expenses. This effort ensures we achieve quarterly positive cash flow from operations without securing additional liquidity. 

We have prioritized growing and investing in our service delivery capabilities. We are protecting the areas that impact our client experience and reputation. We have eliminated selling and marketing costs and investor relations spend to achieve most of our cost reductions. We continue to add new clients despite our pullback in customer acquisition spend but at a slower pace than we have experienced previously. 

When we achieve quarterly cash flow from operations, we will gradually redeploy the cash generated into selling and marketing resources. 

Upcoming Events

  • March 31, 2024 – End of Fiscal Year Q2 
  • May 8, 2024 @ 4:30 pm ET – Quarterly Results Call 

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