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MANAGEMENT PLANS
12 Months Ended
Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
MANAGEMENT PLANS

The Company reported operating income of $329,137 in 2019 and $209,693 in 2018, net income of $47,977 in 2019 and $37,000 in 2018, and stockholders’ deficiencies of $3,907,310 and $4,000,094 at December 31, 2019 and 2018, respectively. Accordingly and due to current working capital deficit of approximately $3.3 million, there is substantial doubt about the Company’s ability to continue as a going concern within one year of issuance of the financial statements.

 

The Company’s mission is to drive shareholder value by developing and bringing to market automated, cost effective, and innovative cybersecurity technologies. The Company’s strategy is to build its business by designing, developing, and marketing IT security-based products and solutions that fill technology gaps in cybersecurity.

 

The Company brought one product to market and intends to bring other proprietary products and solutions to market through a channel of partners and distributors. The products and solutions are designed to simplify the security needs in customer and partner environments, with a focus on Small and Medium-Sized Enterprises (SMEs). The Company enables its partners by providing recurring revenue-based business models that use its automated plug and play solutions. Products may be sold as standalone solutions or integrated into existing environments to further automate the management of security and related IT functions. The Company’s ability to succeed depends on how successful it is in differentiating itself in the market at a time when competition in these markets is on the rise. The Company works with its partner, Webroot, to increase its base of channel partners and to increase sales of Webroot’s cloud-based endpoint security solution, with the objective of growing its recurring revenue model.

 

The Company’s cybersecurity services business is conducted within its professional services organization (PSO). The Company provides services and technical resources to support both its channel partners and end customers. The Company’s goal is to expand on these services throughout the United States via its growing partner network and salesperson team.

 

The Company is working to expand its managed services business with its current federal enterprise customer and its customers.

 

Nodeware® - In May 2016, the Company filed a provisional patent application for its proprietary product, Nodeware.  In May 2017, the Company filed a utility patent application for Nodeware. The patent application is ready for examination by the U.S. patent application examiner. The Company launched Nodeware in November 2016. Nodeware is an automated vulnerability management and network security scanning solution that enhances security by proactively identifying, monitoring, and addressing potential vulnerabilities on networks, creating a safeguard against hackers and ransomware with simplicity and affordability. Customers have the option to purchase Nodeware to accommodate the varying network needs of their organizations. Nodeware provides a value-based solution designed for SMEs with single subnet or several subnets as well as accommodating larger organizations with more advanced network needs.

 

Nodeware assesses vulnerabilities in a computer network using scanning technology to capture a comprehensive view of the security exposure of a network infrastructure. Users receive alerts and view network information through a proprietary dashboard. Continuous and automated internal scanning and external on demand scanning are available within this offering.

 

Nodeware continues to release upgrades with the most recent one in August 2019. This upgrade provides a next generation of the Platform. The new platform’s features include integration of a new, cutting-edge scanning engine, a new reporting engine to easily access reports within the Dashboard, allowing users to securely archive every report and retrieve them instantly and greater technology enhancements around device identification and fingerprinting. Another new feature added to Nodeware was on-demand report generation, which enables IGI’s channel partners to easily pull reports for customers and run reports simultaneously for better cybersecurity management.

 

Nodeware creates an opportunity for resellers, including managed service providers, managed security service providers, distributors, and value-added resellers. The Company sells Nodeware in the commercial sector through its channel partners and agents.

 

Technology and Product Development - The Company’s goal is to position its products and solutions to enable vertical integration with other solutions. The Company has a technology and product development strategy aligned with its business strategy.

 

Cybersecurity Services - The Company provides cybersecurity consulting services to channel partners and direct customers across different vertical markets (banking, healthcare, manufacturing, etc.). Its cybersecurity projects use Nodeware to create a living document that a customer can use to go forward on a path of continuous improvement for its overall IT security. The Company validates overall network security with the goal of maintaining the integrity of confidential client information, preserving the continuity of services, and minimizing potential data damage from attempted threats and incidents. The Company has also started a Managed Detection & Response (MDR) program. This MDR solution includes preparation & consultation, detection and analysis, containment & eradication, and incident response all in one program. It includes 24 by 7 monitoring at the Company’s Security Operations Center.

 

Continue to Improve Operations and Capital Resources

 

The Company's goal is to increase sales and generate cash flow from operations on a consistent basis. The Company uses a formal financial review and budgeting process as a tool for improvement that has aided expense reduction and internal performance. The Company’s business plans require improving the results of its operations in future periods.

 

During 2019, the Company borrowed $200,000 from a related party under the terms of a note payable. At December 31, 2019, the Company had $300,000 available under this financing agreements. During 2018, the Company borrowed $90,000 from related parties under the terms of demand notes.

 

During 2017, the Company originated lines of credit with related parties totaling $175,000 and borrowed $140,000. During 2018, the Company borrowed an additional $20,000. At December 31, 2019, the Company had approximately $15,000 available under these financing agreements.

 

The Company believes the capital resources available under its factoring line of credit, cash from additional related party and third-party loans and cash generated by improving the results of its operations provide sources to fund its ongoing operations and to support the internal growth of the Company. Although the Company has no assurances, the Company believes that related parties, who have previously provided working capital, and third parties will continue to provide working capital loans on similar terms, as in the past, as may be necessary to fund its on-going operations for at least the next 12 months, however substantial doubt about the Company’s ability to continue as a going concern has not been alleviated. If the Company experiences significant growth in its sales, the Company believes that this may require it to increase its financing line, finance additional accounts receivable, or obtain additional working capital from other sources to support its sales growth.

 

The Company plans to evaluate alternatives which may include renegotiating the terms of the notes, seeking conversion of the notes to shares of common stock and seeking funds to repay the notes. The Company continues to evaluate repayment of our notes payable based on its cash flow.