By Peter Epstein
Nano One Materials has a small market cap. Small market cap stocks are highly speculative, not suitable for all investors. I, Peter Epstein, own shares of Nano One Materials. Mr. Epstein, CFA, MBA is not a licensed financial advisor. Readers should take that fact into careful consideration before buying or selling any stock mentioned.
Readers are encouraged to consult with their own investment advisors before buying or selling any stock, especially speculative ones. At the time that this interview was posted, Nano One was a sponsor of: http://EpsteinResearch.com
The following interview of Mr. Paul Matysek, Chairman & Director of Nano One Materials Corp. (TSX-V:NNO) was conducted by Peter Epstein, CFA, MBA in the week ended October 30, 2015. The interviewer, Peter Epstein, believes that the information put forth by Mr. Matysek is accurate, but cannot guarantee that it is. Readers are encouraged to visit Nano One’s corporate website for additional information.
Mr. Matysek is well known to most natural resource investors in Canada and around the globe. He’s the Founder and/or key Executive of 3 highly successful companies. Mr. Matysek is a corporate entrepreneur and professional geochemist & geologistwith over 30 years experience in the mining industry. He’s currently President & CEO of Goldrock Mines Corp. and has previously held senior Executive & Director positions with several natural resource exploration & development companies. Mr. Matysek is a proven company builder.
Mr. Matysek was recently President & CEO of Lithium One Inc., a company that had a world class lithium project in northern Argentina. In July 2012, Lithium One merged with Galaxy Resources of Australia, via a $112 million transaction, to create an integrated lithium company. Prior to that, he was President & CEO of Potash One Inc. where he was the architect of a $434 million friendly takeover of Potash One by K+S Ag. That deal closed in 2011. Prior to Founding Potash One, Mr. Matysek was Founder, President & CEO of Energy Metals Corporation, “EMC,” a premier uranium company that traded on the New York & Toronto Stock Exchanges. Mr. Matysek led EMC as one of the fastest growing Canadian companies in recent years, increasing its market capitalization from $10 million in 2004 to approximately $1.8 billion when it was acquired by a larger uranium producer in 2007.
Most entrepreneurs spend their entire careers without a meaningful success story. You have three. Is there any commonalty among the companies you support?
Yes. Timing, People and Execution. I believe that Nano One Materials (TSX-V:NNO) has these attributes, that’s why I’m Chairman and Director of the Company. I have been lucky in reading trends early (Uranium – Energy Metals Corp – Potash – Potash One and Lithium – Lithium One). I’m committed to attracting and working with the best professionals in the sector and relentlessly focused on executing a business plan.
Any unique, potentially game-changing business model is, by definition, difficult to comprehend. Can you please describe Nano One in layperson’s terms?
Nano One’s processing technology could enable a new generation of batteries by making it economically viable to produce a wider range of advanced energy storage materials. We start with low cost raw materials, such as lithium carbonate, and blend it with other metals using a scalable, patented process. This reduces manufacturing complexity and cost, while delivering materials that are more robustly structured for longer lasting performance. We aim to license and partner with key players in the industry to commercialize our technology, and are already having meetings with a number of parties.
Is Nano One Materials largely a lithium story? If so, can you please comment on the lithium sector?
There is pent-up demand and a rapidly growing market for lithium powered batteries. Nano One’s technology makes lithium carbonate (a cheaper form of lithium) viable for up and coming battery materials and sets us apart from other players.
Technology is changing at an increasingly rapid pace. Nano One appears to embrace change, is it technology agnostic?
Our technology can be used to make a wide range of advanced materials, so it’s not hard for us to shift with industry trends. So yes, we are in fact technology agnostic when it comes to advanced energy storage materials. We expect that our technology will scale and we have a growing list of strong patents. We are working hard to prove to industry players our technology’s performance in real life batteries.
Management describes in detail the importance of its Intellectual Property, “IP.” Can you characterize the strength of Nano One’s IP?
Nano One’s patents cover a broad range of materials and were issued quickly with only minor revisions. This indicates to us that we have a unique technological edge with fertile ground to expand our IP portfolio. Broad patents like ours can provide freedom to operate and should draw the attention of global players looking for strategic IP advantages.
Will the Nano One be following precise recipes from customers, or will it add value (with IP) by improving upon a customer’s specifications.
We will work with industrial partners in leveraging our technology and know-how to (i) to improve on battery material recipes and (ii) enable a new generation of materials.
How much due diligence did you do to become comfortable enough to agree to be Chairman of the Board of a small company?
The process took almost a year from initial contact with the Founders of Perfect Lithium to the close of the transaction, to taking them public through an RTO of my company Dundarave Resources. I conducted a considerable amount of due diligence to understand the space, the opportunity and the people involved. Lastly, I made sure that I could help formulate and execute their business strategy.
Some companies retain industry rock stars like yourself to serve on their Boards. Sometimes that person is merely a figurehead. What role are you playing?
I’m an active and involved Chairman of Nano One Materials, providing mentorship, contacts and advice to management. My skill set compliments the strong team that we have in place.
From your perspective, can you name near-term catalysts that investors should watch for?
With each new patent, the Company is de-risking its technology and making itself more attractive to industry players looking for strategic IP advantages. Nano One is speaking with a wide range of potential industry collaborators and has growing support of the Canadian government. Formalization of these discussions would boost our credibility and could provide near-term catalysts. We are working on a number of corporate initiatives, several of which could also be investment catalysts over time.
The TSX Venture Exchange is in a downturn of epic proportions. To what extent is Nano One tied to the variances of the TSX:V?
Certainly the difficult market environment on the TSX Venture exchange has effected the number of qualified investors in Canada, but the Company has ambitious plans underway to gain exposure in Europe and the U.S. This should allow Nano One to separate from the pack of junior mining companies that dominate trading on the TSX Venture Exchange.
Can you please comment on key investors in the Company?
Management has a significant shareholding base and other key investors were brought in during the recent $0.25 IPO placement. One significant fund that has a sizable position is Pathfinder Capital, a fund that has been significantly outperforming the market in the small cap space.
Are there any misconceptions regarding Nano One Materials that you would like to address?
It’s key to understand that we have a growing portfolio of IP that’s attractive and we’re confident that our technology is industrially scalable. Freedom to operate has immediate and long-range value for strategic players looking to manufacture materials, cells and/or batteries. This forms the basis of the collaboration discussions underway.
Paul, thank you very much for your valuable time and insightful answers.