This teaser pitch has been around for a while, but I haven’t looked at a Luke Lango teaser ad yet, and he’s been around for a few years now, so it seems time. Lango has been contributing articles and running some services at Investorplace for a few years, but really got more attention when they started touting him as “America’s Best Stock Picker” in the last year or so, and when they handed him all of Matt McCall’s subscribers when McCall left the company… so now Lango is part of a lot of the “summit” infomercial presentations highlighting growth stock picking, often paired with Investorplace’s most established star, longtime newsletter guy and veteran quant Louis Navellier.

I’ve read a bunch of Lango’s teasers and free articles over the past few months, so we know that he’s very focused on popular new-era tech stocks — Electric Vehicles, 5G, AI, proteomics and genomics, etc., all the buzzwords, and I’ve seen him freely reveal some favorites in the past like Opendoor (OPEN), Schrodinger (SDGR), and a bunch of the SPAC names like Joby Aviation (JOBY), Stem (STEM), Volta (VLTA), Virgin Galactic (SPCE), etc. That’s not a criticism of those stocks specifically (I own SDGR in my $100K Lock Box Portfolio, just FYI), if you want to buy the future those are some of the kinds of stocks you’re buying, and Lango seems to have a long-term focus on buying these ideas, which means he’ll be counting on something like the David Gardner approach to make it work out (having a few 1,000%+ winners who make up for the failures) — that strategy, buying growth and optimism at almost any price, has been spectacular for a few years. Whether or not it’s worth paying the current price for any specific one of the ideas he touts, well, time will tell.

But today, we’re looking at what seems to be Lango’s July 2021 update of an older Matt McCall teaser pitch about the “#1 Electric Vehicle Stock of the Decade.” I don’t know whether he likes the same stocks as McCall did back in 2019 when a similar ad, in that case highlighting the “Jesus Battery” and the “Quantum Glass Battery” began circulating (I last looked at that ad about a year ago, if you want to look back and compare), and we should always be mindful that the most heavily promoted ad for a newsletter is not always teasing the editor’s favorite stock, (it’s often just the ad that has proven to work best at recruiting subscribers — what you can sell matters more in this business than how well your picks do, at least in the short term), but still, I’m curious. So let’s see what’s up.

The intro tells us that Lango is a stock-picking genius…

“One of America’s Top Tech Futurists: The #1 Electric Vehicle Stock of the Decade

“He’s the 25-year-old stock-picking genius who forecasted the rise of Shopify, AMD and Square before they were household names…

“He called the stratospheric rise of GameStop that occurred in 2021…

“He predicted the electric vehicle boom back in 2017 and recommended NIO Workhorse and Tesla before they each soared over 1,000%…

“Also, the rise of telehealth, virtual work and entertainment…”

So what’s this EV technology he’s touting? Like McCall before him, this is still about the solid state battery… though they called Matt McCall “America’s #1 Tech Futurist” and Lango, in this reboot is just “One of America’s Top Tech Futurists”…

“It’s called SSBT.

“And although most people have never heard of SSBT, Luke says it will soon be one of the biggest stories in America.

“Insiders in technology labs around the country are already using words like “Holy Grail” … “revolution” … and “paradigm shift” to describe the impact it’s going to have.

“That’s because it could change your daily life… the way you work, live and travel…

“It will change the appearance of virtually every small town, suburb and big city in America…

“While redefining how much you pay for utilities … insurance … even fuel .

“He will even show you how it could put as much as $14,500 back into the pockets of ordinary Americans like you and me.”

And most of the next swathe of pitching comes directly from McCall’s old ad, so it’s pretty clear this is an update of an ad that “worked.” It’s still quite generic, though, with the references to the idea of a solid state battery, so it could apply to lots of different companies (especially now, with more and more new battery companies coming public in recent years). Here’s a little taste of that:

“Insiders are calling it a “paradigm shift” in energy technology…

“A “forever battery” that will usher in the next great energy revolution.

“Even going so far as to call it the “Jesus Battery” because the properties it exhibits are so miraculous.

“Imagine soon being able to fully charge your smartphone in the same time it takes to flip on a light switch—just a fraction of a second.

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“Now imagine a charge that lasts NOT for a few anxiety-filled hours, but for nearly TWO WEEKS.

“Now imagine a battery that doesn’t degrade over time—one that can be recharged, get this… over one hundred thousand times – without losing strength.”

But the real focus of the pitch, of course, is on the car — that’s not where most batteries are used these days, but it’s the dream of the future, and it’s clear that battery technology and recharging technology are a big part of what will be needed for electric vehicles to meet the goals the car companies (and governments) are setting to fully electrify over the next ten or fifteen years.

More from the ad:

“Fully Charges Cars in Just 60 Seconds

“Already companies have begun ripping out outdated lithium-ion batteries in today’s electric and driverless vehicles and are replacing them with the ground-breaking new Solid-State Battery technology…

“And the results are nothing short of earth-shattering…

“According to automotive industry insiders, one creation using SSBT can fully charge an electric car in as little as 60 seconds.”

There are even some charts that show the theoretical advantage, with “SSBT” getting 1,000 miles to a charge while the Tesla Model X or S top out around 350… which is absurd, of course, because SSBT is a pre-commercial technology, not attached to a specific vehicle yet, and the Tesla is an actual car you can buy, one of several now that have a range something close to 300 miles or more.

But yes, that is the hope and promise of solid state batteries, those that use usually thin films or sheets of metal instead of liquid electrolyte — they can last through more recharge cycles, they can theoretically charge much faster, they can work in many different shapes, and they don’t catch on fire. Seems ideal for cars, naturally, but the development timeline has been long and onerous, and changing the chemistry of batteries and getting to the point where you can produce that new chemistry or format at massive industrial scale is hard.

The basic idea of a solid state battery is that you replace lithium salt electrolytes with lithium metal as the electrolyte, and lots and lots of labs and research companies are trying to do that. Some are going straight to thin film metals, some are using polymers or gels that are something of a “semi-solid” middle ground, there are lots of different ideas and chemistries and metallurgies at work. There are commercially available solid state batteries (though generally very small in size), so there’s some clear hope that those technologies can be scaled up over the next 5-10 years to EVs, though it’s impossible to predict exactly which direction the science will lead us, or which lab or startup has the best design.

That’s one of the larger challenges in this space for investors, the fact that while there are plenty of publicly traded battery technology companies, a huge amount of the work is also being done in labs you can’t invest in — whether that’s SAFT, one of the leaders in battery production now but a small division within French oil giant TotalEnergies (TTE), or the work being done within large battery industry leaders like Panasonic (PCRFY), which has been a major Tesla supplier, and LG Chem (LGCLF), which builds a lot of EV batteries with GM, who also have lots of other divisions… or, of course, the hundreds of university and research labs who are also working on next-generation battery designs. There may or may not be one or a handful of winners, and the world might settle into a handful of leading designs, like they did with Lithium-ion batteries over the past 25 years, or we might see dozens of different battery technologies vying for space in the next generation of electric vehicles.

Many of the car companies are hedging their bets, too, working with several different battery companies and developing ideas in their own labs, so we should probably step back from the idea that we want to imagine one big winner — if you want to own the best battery company of the future, assuming such a company does rise out of this competition and research, you’ll probably have to buy lots of them along the way and see how it plays out.

So that’s the buzzkill part of my spiel… what do we learn about Lango’s favorite ideas in this space? Let’s keep sniffing around the presentation…

The “free” recommendation is exactly the same as it was for Matt McCall in his pitches before he left the newsletter — Lango is parroting the recommendation of Toyota:

“Recommendation #1: TM

“Remember, at the beginning of this presentation I told you I’d give you the name and ticker symbol of a terrific Solid-State Battery company you could buy right away.

“This company, by most accounts, is the clear leader in the adoption of Solid-State Battery technology…

“Engineers at the company have already built working prototype batteries and have mounted them in a fully operational concept vehicle.

“The company I’m talking about is the innovative auto pioneer Toyota.

“In fact, Toyota was going to debut its working solid-state-powered prototype at the Tokyo Olympic Games in 2020, but the event had to be canceled because of the coronavirus pandemic.”

Which is interesting mostly because Toyota has been widely seen as anti-battery — or, at least, as favoring the continuing development of gas/electric hybrid vehicles (like their pioneering Prius) and hydrogen vehicles (like the Mirai), and not investing heavily in battery electric vehicles. They did some heavy marketing for their LQ Concept car during the Olympics, a campaign that was apparently planned for 2020 before the Games were postponed, and though the marketing focused mostly on the personality of the car, the onboard AI they call “Yui”, that same model has also been road-tested with solid-state batteries recently — not something that means we’re ready for commercial production yet, but a pretty big step in a world where most of the automakers and battery companies have been pretty secretive about any real-world tests of their technology.

Maybe Toyota will be first in production with an EV that uses solid state batteries,, which would be a shock to everyone who has watched them drag their feet with EVs to this point, but we won’t know for at least several years. And, of course, since they’ve also invested massively in hybrid and hydrogen cars, as well as conventional automobiles, and there’s very little chance they’ll ever get valued like a high-growth EV stock, that’s not a “10X returns” kind of investment idea. Toyota has generated roughly 10X returns over the past 30 years, if you include dividends, so it might again… and it’s a relatively inexpensive company, priced at less than 9X their expected profits for 2022 (and 12X 2020’s earnings), with a dividend of 2.5%, so I wouldn’t try to talk you out of Toyota… but it’s not going to get a Tesla-like valuation anytime soon. (Incidentally, Toyota has a market cap almost exactly a third the size of Tesla, despite the fact that Toyota will likely have a net profit this year that is higher than Tesla’s top-line revenue number — one of the many comparisons people have used between Tesla and essentially any other major carmaker to emphasize the fact that Tesla is absurdly valued.)

But anyway, yes, that’s the same pitch McCall made earlier this year — and he’s also making the same price call, suggesting you buy Toyota at anywhere under $140 per share (a level the stock hasn’t seen since last December, incidentally, it’s currently around $180). How about the second, secret idea from Lango?

Here are the clues:

“If you want to put yourself in line to see gains…

“You need to pay attention to the little-known company working with Toyota and several other major automakers to bring this technology to market…

“Because at the heart of the Solid-State Battery revolution…

“Lies one tiny company—about 1/557th the size of Toyota—who owns the critical patents to the technology.”

OK, so if we’re going to assume he means Toyota at $140, that would mean a $200 billion market cap… and 1/557th of that would be about $360 million. Broad strokes here, since that part of the ad is being reused, but there has been some updating — the version I saw back in March from McCall, for example, said the company was less than 1/1,000th the size of Toyota.

The other clues are similar, though, when it comes to patents…

“Its patents have already been granted and approved in SIX major automotive markets across the globe, including—

The United States
Europe
China
Japan
Canada
Great Britain

“And it trades for less than $3 per share.”

Last time out, that was “less than $2 per share”, but otherwise the same. Including this bit:

“… this is the firm Toyota is doing business with to help bring the technology to the mainstream!

“They’ve forged an historic partnership deal with this tiny firm to fast-track the production of the technology behind the Solid-State Battery… to get it into their cars and bring it into the global mainstream.

“And they’re not the only ones doing deals with this firm…

“Another is the fourth-largest auto company in the world who produces around 5 million cars per years… 20 million motorcycles… 6 million other products.

“And yet another company is one of the leading luxury auto manufacturers in the world — a name that is synonymous with status and prestige.”

And we’re told that it’s early, the technology has not “rolled out” yet, and it’s still “nearing the critical pilot stages”. Any other clues?

We get a hint about the current revenue level:

“Let’s say this company’s battery captures just one half of ONE PERCENT of the global electric-car market in the coming years…

“That will be enough to boost its revenues to more than $6 BILLION when production and sales are in full swing…

“That’s more than an incredible 27,746% increase from where it stands today.”

Interestingly, Matt McCall’s original ad also teased a “27,746% increase”… but said that would come from getting the revenues to more than $2 billion, not $6 billion. So I guess, if this is indeed the same company, we should only think of those numbers in extremely general terms. If you’re growing by 27,746% and the end result is $2 billion, that means you start with about $7 million… if $6 billion, then about $21 million. I’d say we’re just thinking “very low.”

Combine those clues about market cap and revenues, and we have revenue below $21 million and a market cap within shouting distance of $360 million. Lots of companies in that range.

How about the other clues? That they have “forged an historic partnership” with Toyota, and have a deal with the fourth-largest auto companY? That’s Honda, which might make it a little easier… and that means, yes, Lango is very likely still pitching Matt McCall’s old idea, first teased almost three years ago, of the UK’s small battery R&D company Ilika (IKA in London, ILIKF OTC in the US).

And it’s had quite a run since I first covered it back in early 2019 — I’ve been watching it, but never did buy shares, and it is up a good 500% or so since then (it was up more, shares were around 20 pence when I first wrote about it, and are currently around 140p, but got as high as 260p or so during the nuttiness in January and February this year).

Whether that surge in the shares back in December and January was caused by McCall’s continued pitching, or the follow-on impact of all the excitement about electric vehicles, I have no idea — Ilika did have to respond to regulators about the wild price action, just to clarify that they are not promising to be ready for the mass market yet, here’s the statement from December 29 of last year:

“The Board notes the recent rise in the Company’s share price and the growing interest in solid state batteries in the media in recent weeks regarding their future potential in automotive applications. The Company reiterates its guidance set out in the announcements dated 11 and 24 November 2020. In particular, whilst the Board is confident about the prospects for the Company’s Goliath larger format batteries, mass market commercialisation is dependent on further technical development and successful manufacturing scale-up.”

Ilika is working on automotive battery cells, which they call their Goliath project, and has gotten some grant funding and participated in joint venture R&D projects with several automakers, including Land Rover/Jaguar and McLaren as well as Toyota and Honda, though they’re nowhere near producing large-scale batteries and were presumably not involved in Toyota’s demonstration of a solid state car recently (they might have been, I suppose, no one’s talking, but it’s implied that the batteries are a Toyota project, and it would be surprising to not brag about it if Ilika were involved).

More recently they got a small grant from a division of Fiat to help scale up their “pre pilot” line for Goliath, and that’s the kind of thing that has generated most of Ilika’s limited revenue over the years — grants and joint venture R&D projects, often funded by the UK government, recently focused on being part of the UK Battery Industrialisation Centre as the UK tries to make sure it has the capacity to be a player in electric vehicles in the future. Their “framework agreement” with the UK battery program is to target a growth in production from 1kWh per week in the test project to 5MWh per week by 2024. That’s still trivial, in the context of automotive batteries — if I did my math right, that’s about enough batteries to build 3,000 EVs per year. So like most of the next-gen EV battery stories, including much larger Quantumscape (QS), this remains a pretty-far-in-the-future story.

(On that point, we can’t know which technology might end up being preferred or commercialized, assuming either makes it that far — both are effectively targeting early production in 2024 or 2025 — but Quantumscape is at least spending money a lot faster in trying to develop theirs, QS spends more on R&D in one quarter than Ilika has spent in the past five years).

The major focus for Ilika for the moment, however, remains commercializing their Stereax line of batteries — those are very small batteries, for medical devices and IoT sensors and things like that, and they have had a pilot line in operation for Stereax batteries for a while. The big shift there is that Ilika decided that making their own batteries was the better call, scaling up their own manufacturing capacity instead of waiting for a partner to license their technology and invest in new factory lines. That decision was made over the winter, and they’ve now built out their first production line — it’s still small, but they say they’re qualifying the major tools now and should be able to begin production by sometime in early 2022. They say they have evaluation samples out with 16 Medtech and IoT customers who they hope will place orders.

This is their stated outlook from the annual results update this past summer:

“Ilika has an intensive period of operational implementation ahead of it for the remainder of this financial year and into next year as it deploys the capital it raised in March 2020 to establish a manufacturing facility for Stereax to satisfy the demand from our medical and IoT customers. The technical maturity of Goliath is expected to continue to rise as prototype cell performance continuously improves. Ilika is looking to accelerate its plans for the scale-up of its Goliath technology such that it can reach a point of manufacturing readiness. These plans would require additional financing to realise, with potential sources of financing including additional government grant funding, equity financing and investment from strategic partners. The Board’s confidence continues to build in the commercial opportunity for Ilika’s technology across the large markets it addresses and this will provide a strong platform for future growth.”

They’ve now raised capital a couple times since I first covered the stock, including an equity raise in late July, so the share count has gone up by about 50%. That’s pretty likely to continue, since my assumption is that even the initial commercial production of Stereax batteries next year is unlikely to be profitable in at least its first year or two — it is a higher production line, 70X the size of their pilot project, so it will be more efficient, but we don’t really know what kind of revenue it might generate or what their commercial operating costs might be.

I was interested in Ilika the first time around mostly because I liked their strategy — license out the intellectual property, let other people make batteries using their designs (like fellow UK IP developer ARM Holdings does with semiconductor design), and collect royalties. The fact that they’re building out their own battery line, even if it’s fairly small, is less interesting to me. Competing in manufacturing and building up a new battery production facility is a lot harder than developing a new design.

We’ll see, though, perhaps their Goliath battery project, which has been working through lots of different designs and iterations in its initial “pre pilot” project, will bear fruit in a few years. I’ll continue to just watch, personally, though perhaps if they keep raising money and the shares keep falling as they get a little closer to actually generating revenue I’ll get more interested again.

There are a many more next-gen battery technology companies out there than we saw in 2019, at least in the public markets — and that’s at last partly because of the tsunami of SPAC money that was thrown at anything EV related over the past year. Quantumscape (QS) is the poster child for battery tech still, thanks to their big financing from Volkswagen and their secretive posturing, and that has been teased and recommended a few times (here, for example), with their most visible competitor probably being Solid Power, funded by Ford and BMW and going public through a SPAC merger right now (Decarbonization Plus Acquisition Corp III (DCRC) — presentation here), and we’ve also seen lots of pitches from Paul Mampilly about the grid storage potential of new battery tech, including the still-private Sila Nanotechnology and the interesting new grid storage software company Stem (STEM), which brings to mind the recent SPAC-funded Enovix (ENVX), another interesting one that, like Sila, is trying to advance lithium ion batteries not by swapping out the liquid, but by using silicon in the anode, and the battery tech company Novonix (NVX.AX, NVNXF) has been promoted a lot by both Ray Blanco and Michael Robinson recently and is currently soaring, mostly because of its Tesla connections and dreams of a possible NY listing.

Where will this world go? I don’t know. It’s all too uncertain for me to be interested enough to place a bet on which solid state battery technologies might be commercialized by 2030 — they all sound impressive, from the projections of 2027 free cash flow for Solid Power to the 70X production increase from Ilika next year, and they all have noble goals and seem to have capable leaders who are trying to build capacity and meet their R&D benchmarks on the way to production, but it’s really hard to focus on a capital-intensive business like battery production when we don’t know when the revenue will come. If you do decide to invest in a few of these potential battery leaders, be ready to hold patiently for probably five years before revenue becomes meaningful or foreseeable (and, of course, some of them might fail to make it that far). The good thing? Most of them are a lot cheaper now than they were last February, and some of the urgency has left the building as the stocks have come down, so you have time to think it over.

That’s what I think, anyway… but it’s your money, so what say you? Let us know with a comment below. I know quite a few folks have been following Ilika since I first covered it a few years back, and I’m sure many of you have dabbled in plenty of other battery stories as well along the way… feel free to chime in with your favorite, or to tell me why I’m wrong. Thanks for reading, and have a great day!