Traders and Investors,

We've got a brand new small cap tech play to to tell you about for tomorrow.

Check out Surge Holdings (SURG) right now.

SURG's chart has been consolidating for many months now, and we think recent news from the Company could be catalyst it needs to breakout of this strong sideways action.

SURG has a 52 week high of over $1.40. That's some 250%+ upside from its current price.

Now I'm not suggesting it will get back to these levels tomorrow, but even a small retracement could yield big gains. And on the longer term, there could be plenty of upside to be had.

And a recent shareholder's update from the Company points to huge revenue numbers. 

According to the update, revenue totaled $7,485,485 in the six months ended June 30, 2018.

That's huge!!!

And according to CEO, Brian Cox, in the same Shareholder update, SURG has been built for speed and to scale rapidly so that they can move swiftly toward their 2019 EOY target of 15,000 locations.

This could mean $22.5 million in revenue per month according to this Goldman Small Cap Research Report!!!

Keep reading to learn all about SURG...

Surge Holdings (OTCQB: SURG) is a rapidly growing wireless and fintech payment services company engaged in servicing lower and lower-middle income consumer needs.  The Surge plan is to become a financial hub for people without ready access to a bank or those who need to conduct their financial affairs with cash.  The company generates revenue in three product verticals; Surge Pays Portal, the company’s SaaS services payment and services management system, financial products (pre-paid debit cards, wallets, and money orders), and cell phones.  With its suite of products, Surge becomes a major profit partner for its network of convenience stores, bodegas, and independent grocery stores with additional sales available online.

Business Model

The company business model is simple; develop a portfolio of products and services that target the unbanked and lower income population, then expand through relationships with a network of convenience store operators.   The anchor product is the company’s payment services software called Surge Pays Portal.  The Surge Pays system is sold on a SaaS basis to convenience store operators.  The system offers ‘top-off’ payment services.  Top-offs are payments accepted at the store and transmitted to cell phone companies for service.  Surge accepts payments for many of the major cell phone companies and those with smaller market shares.  Top-off services earn the store operator a service fee while providing the customer with an opportunity to make an in-store purchase.

The Surge Pays system does much more than just allow a customer to pay for cell phone services.  The same technology permits payments for utility bills, tax bills, and other recurring payments.  Surge Pays accepts payments, or is in the process of implementing payment agreements, for over 1,200 products and government agencies.  The company’s financial products allow the unbanked to have access to bank-like debit cards, wallets, and other products that the banked population currently accesses through a multitude of financial services companies.  Surge is creating an analogous environment for those forced or those who choose to conduct their financial lives without the use of credit or banks.  The Surge financial products require customers to have pre-paid.  The convenience store, through the Surge Pays system, becomes the ‘bank’ for the unbanked.

Cell phones are the physical piece of the puzzle.   Smart phones allow consumers to access their Surge debit card, wallets, and other cash accounts without the need to physically come to the convenience store.  Using Surge Pays, a smart phone can become a personal financial operations center for those without bank accounts.  

SURG Blockchain

SURG Blockchain, a wholly owned subsidiary of Surge Holdings (SURG), has completed development of the ERC-20 Surge Utility Token and has made available free tokens to all who sign up at www.surgetoken.com before the December 15 launch of SURG Crypto Token.
 

The Surge Token is an ERC20 compliant blockchain asset that can have value, be stored in a wallet, used for transactions and can be sent and received, like Bitcoin, Litecoin, Ethereum, or any other digital asset.  

“The technology we’ve developed is soup to nuts, from the issuance of the reward tokens to requests for redemption to transmitting our ERC-20 token to Ethereum.” Stated Chief Technology Officer, John Mott. 

Tokens will be earned through purchases of Surge products and services or through incentivized activities such as automatic paycheck deposits to the SurgePays Debit Card or paying certain SurgePhone Wireless combo specials. Tokens can be redeemed for rewards and or stored in digital wallets. 

The difference between Surge Tokens and standalone currencies like Bitcoin and Litecoin is that the Surge Token will piggyback on the Ethereum network, hosted by Ethereum addresses and sent using Ethereum transactions from a smart contract. 

Surge Holdings Inc. CEO Brian Cox said “The underlying principle to the Surge business model is to drive revenue by bringing products and services to those who might otherwise not have access to them. This fits perfectly into our overall strategic plan for customer loyalty, enhancing the Surge ecosystem and overall corporate valuation.”  

Cox further stated, “By using the Surge Utility Token for loyalty rewards, we will be enabling the 51% of the subprime market to participate in Digital Assets – the future.” 

Additionally, the software system has been designed as a white label token/rewards system so that Surge can offer this technology and software to other companies seeking a turnkey solution for ERC-20 tokens. 

The Surge Utility Token rewards system is slated to launch December 15, 2018. 

Rewards will be redeemed at www.surgerewards.com 

Value Proposition and Competitive Advantage

Once installed at a retail location, Surge Pays provides digital access to the retailer as well as an ACH connection to their checking account for payment transfer.  This allows a retail operator to order goods online through Surge.  The Surge Pays system produces a purchase order.  The PO is sent to the manufacturer along with the money transfer to initiate a drop ships of goods from the manufacturer’s warehouse.  

This simple process is expected to revolutionize the industry.  What once required a manufacturer’s rep to visit a store can now be handled through a message sent through the Surge system.  Coupled with Surge’s business relationships, the Surge Pays software creates recurring revenue for the company, its contract sales force, and its convenience store clients.  Surge Pays’ advanced generation merchant services software, and the companies that accept payments through Surge, creates a new paradigm for these underserved markets.  The system also creates a significant barrier to change for the retailer.  The retailer knows that selling a Surge participating $20 wireless plan earns them $2 per month.  As the number of subscribers grows, so does the retailer’s monthly revenue.  

Payment Services

Surge Pays Portal is the company’s block chain-based merchant POS portal for payment services and ordering products.  The block chain technology offers security and speed over many older convenience store systems.   Surge Holdings has shown success in selling this product as a replacement for existing store systems and as an initial system for new locations.  Offered on a SaaS basis, the Surge Pays offering allows a store operator to manage payments on a terminal while reviewing store progress via an Android app.

The Surge Pays program accepts payments for many cell phone, long distance and pin-less services, as well as many international top-offs.

The company anticipates it will accept payments for over 1,200 participating organizations in the coming months.

With the Surge Pays system, a local convenience store can serve as a financial services hub for people who are unbanked or otherwise need to pay cash for their purchases.

Financial Services and Products

Surge’s financial services product line includes a pre-paid debit card, e-wallets, and money orders.  The card is available with a MasterCard, Visa, or Discover logo.   The same convenience stores that accept payments for other services through the Surge Pays software system will also sell and replenish the company’s pre-paid debit card.   This is a natural ancillary product to the merchant payment system.

The Surge Pays system will allow customers to purchase goods through the system in an Amazon Prime-like business model.   Surge will work with companies to provide products on a drop-ship basis using the pre-paid card and other customer cash accounts for payment.
CEO Brian Cox commented on the future of e-commerce through Surge.

It is my belief that half of the country will never be candidates for the “Amazon Primes” of the world. These folks’ goods and services will continue to be purchased at corner stores, markets, and bodegas near their homes. By building a distribution railway into these mom-n-pop stores across the USA, we intend to become the largest provider of telecom, fintech, and consumable products to these neighborhood stores.  There are no limits to number of store locations, products and or revenue per month for Surge. 

Mobile Phones

Surge offers government lifeline phones through True Wireless and traditional cell phone service through SurgePhone.   The government lifeline phones are available to people with limited incomes.   The phones offer 1,000 minutes and 1 GB of data per month.  The US Government pays $9.25/month for voice services per phone with funds collected through the Universal Service fee on all phone bills.  The FCC pays an additional $9.25/month for phones with broadband capability.  In tribal territories, the company receives $34.25/month.  True Wireless is currently licensed to provide lifeline services in 5 states.  Over 60,000 subscribers, including veterans and people of lower incomes, carry cell phones served by True Wireless.  These phones are available for pick-up in local stores or they can be shipped to the customer.
    
SurgePhone is a customer paid MVNO.  It is available in all 50 states.  The company’s products are priced to offer discounts on the prices charged by the major cell phone companies.   SurgePhone units will offer greater functionality than those offered by True.  In all 50 states, if and when the lifeline service is terminated, SurgePhone will be positioned for the transition. 

Conclusion

Surge Holdings is a story about offering an attractive portfolio of products that position the company as a preferred convenience store vendor.   While other companies offer these services individually, Surge Holdings management believes that Surge offers the only integrated payment system targeted at convenience stores.  The Surge Pays block chain-based payment system offers an advanced generation product for store owners and operators.   The net results include greater revenues per convenience store to be shared by the store operator, the ISO, and the company.   Additionally, the increased revenue yields a significant barrier to change once a store becomes a Surge Holdings client.   

We think there could be a good opportunity here in SURG, especially with its price around $0.39 and recent highs of well over $0.45. In fact, SURG hit a 52 week high back in January this year of over $1.40.

A move back to those levels could bring 250%+ upside to traders and investors.

So, get SURG on your radar for tomorrow and be ready for the opening bell.


All the best.

SmallCapMomo.com

Remember our key trading rules when trading. Capital preservation is key. Keep your stops tight, and if things don't go your way, cut your losses and look for another opportunity.