Grom Social Enterprise (GRMM): Creating Buzz

April 17, 2018 - Worldwide Financial Marketing, Inc.


Grom Social is continuing to see robust operating performance. This media company has a unique operating strategy by acquiring synergistic companies with significant enterprise value, while it builds its core user base.

- The Company has an excellent capital structure

- The Company has a sound data protection strategy

- Recent Forbes coverage improves visibility

The controversy surrounding Facebook (FB) have raised a lot of question marks, especially with regards to how the social media giant handles the data of its 2.2 billion users. This week, Facebook CEO will be testifying to Congress about the data leak of 87 million users. And, the news about YouTube is equally if not worse, with the mega giant allegedly collecting data on children’s viewing patterns-in violation of federal law- according to a coalition of 23 advocacy groups in a complaint filed Monday with the FTC.

Privacy issues is just one of the many concerns about Facebook. Cyberbullying and trolling is another major concern. And in fact this has been the reason why the social media network is not recommended for children and teenagers. This concern, however creates a major opportunity for Grom Social Enterprises, Inc (“GRMM”).

From its inception, Grom has recognized the critical importance of privacy and safeguarding its users, and has devoted significant resources to protecting users including 24/7 live monitoring.

From its humble beginnings, Grom Social has come a very long way. The company is creating buzz, most recently where its founder, Zach Marks was interviewed in an article on the popular business magazine, Forbes.

We believe Grom’s stock is significantly undervalued and represents a buying opportunity. Such coverage will also improve GRMM’s visibility among investors and boost share price

Capitalizing On an Opportunity

Marks, now 17, created Grom Social when he was just 12 years old. This was after Marks was not allowed to use Facebook by his parents. His parents’ concerns were legitimate. While social media platforms such as Facebook and Twitter are useful, there are also many issues. Cyberbullying and trolling are two such issues. Once Marks was taken off Facebook, he decided to create a social media platform for kids. That is how the idea of Grom Social was born.

Grom Social is a wholly-owned subsidiary of Grom Social Enterprises (“GRMM”), is a social media platform for kids between the ages of five and 16. The social media platform began its journey in 2012 and has attracted more than 14 million users, since inception.

Unlike its competitors business models as the platform has grown in anticipation of generating significant future revenues, Grom Social Enterprises has added complementary businesses which are valuable in their own right and which will drive future revenue growth and help increase the size of the user base thus making it more attractive to advertisers.

Grom Social has surpassed 14 million users since inception, comprised of approximately 7 million children between the ages of five and 16 and an approximate equal number of parents, guardians and teachers. In addition, more importantly, it continues to grow rapidly by adding more than 300,000 children users per month Grom’s other platforms add an additional 2 million kids.

On average, users spend 50 minutes on the site. The average time users spend on Facebook is around 21 minutes.

The pace of user addition has also increased significantly in recent years. The platform surpassed 1 million users in July 2014. In less than four years, it has added more than 14 million users. This is phenomenal growth by any standard.

Complementary Acquisitions

While Grom Social is the key value driver for Grom Social Enterprises, there is more to the company than the social media platform. Grom Social Enterprises has made several strategic acquisitions in the past two years and these acquisitions complement the main social media business.

In July 2016, the company acquired Top Draw Animation. Top Draw Animation is an award winning animation company. It is one of the leading 2D animation companies for television markets globally. The company currently outputs more than 200 half hour segments of television worldwide. Top Draw Animation will enable Grom to become a major player in digital media and is key to the company’s growth strategy.

Grom Social also owns:

Grom Educational Services, which offers web filtering services through NetSpective Web filter. The company had acquired NetSpective in January last year. NetSpective is a leading provider of scalable monitoring and security solutions. It services around 2 million school aged children in 400 school districts in the U.S. But this is just the tip of the iceberg. The potential market size is 75 million students so there is still plenty of room to grow. In fact, Grom Educational Services could end up as being the most important value driver over the next few years, given the commercial opportunity in front of the company.

Grom Social Enterprises also owns MamaBear, an all-in-one safe parenting app that creates a private family communication hub. The app surpassed 800,000 downloads in 2017. The Company’s completely upgraded version 2.0 was released last week. GSE recently acquired Fyoosion an innovative marketing automation engine based platform that unifies all channels and presents a unique merger of marketing and technology. Groom plans to utilize Fyoosion for its own brands and third party business.

Grom Nutritional Services. The company entered into an agreement with Bond Technology Systems, a manufacturer of liquid nutritional supplements. As part of the agreement, the two companies have developed a new supplement “Just Brilliant” which Grom plans to distribute to its base of children. The first product could be launched by the end of the second quarter in 2018.

Privacy Issue Well Covered

The Facebook data leak has rightly created concerns over how user data is shared by social media platforms. Grom Social though has always been extremely careful in how it handles its users’ private data. The company follows COPPA guidelines, which aims to protect the privacy of children under 13 online. In the recent Forbes interview, Darren Marks, Chairman and CEO of Grom Social Enterprise, said that apart from following COPPA guidelines, all the data the company has is stored on different servers behind firewalls. Grom has the kidSafe seal of approval and unlike Facebook and YouTube Grom does not share data.

Disclaimer:

Except for the historical information presented herein, matters discussed in this release contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance, or achievements expressed or implied by such statements. WFM, Inc. is not registered with any financial or securities regulatory authority and does not provide nor claims to provide investment advice or recommendations to readers of this release. For making specific investment decisions, readers should seek their own advice. For full disclosure, please visit: http://wwfinancial.com/legal-disclaimer/.