Restarting this blog (again) with a bet on Blackberry. (BB).

What I'm buying | Blackberry (BB)

Average price per share for this bet | $9.60

My Blackberry circa 2008-ish.

Why I'm risking a bit of my hard earned, runty nest egg into this company | Once upon time, everyone who was anyone had a Research in Motion (RIM) Blackberry. Even nobodies like me had a Blackberry. I started with RIM's first pager-like email-only device at the end of the 90s and became even more of a fan as Blackberries morphed into full on smart phones. Then Steve Jobs unveiled the iPhone and... poof, Blackberry was gone. Truly, it happened so fast, just a few years. But today's Blackberry (since renamed from RIM) is not your father's Blackberry, and I think the company's laser focus on securing the rising Internet of Things (or Enterprise of Things as BB cleverly calls it) will pay off.. 

Here's the thing about the Internet of Things (IoT). Most things connect via a cell tower just like a phone and the one reason Blackberry (BB) held on for as long as it did after the iPhone appeared on the scene was that Blackberry phones were ridiculously secure. Many paranoid companies and governments would settle for nothing less. In other words, BB knows how to secure connected devices. And as cars and machines and jet engines and, yes, toasters and other things connect to the internet, they will need to be secure, period, full stop. Remember Stuxnet when the US hacked in into an Iranian nuke plant and caused some machinery self destruct? Or when some sneaky bastards hacked into Target and stole a bunch of credit card data? Or more recently when the Mirai botnet took down Etsy, GitHub, Netflix, Shopify, SoundCloud, Spotify, Twitter, and a number of other major websites? At the heart of every one of these incidents was some sort of security weakness in a connected thing. And going forward, there will be a LOT of connected things needing security, with estimates running about 20 billion by 2020. Seems like BB's in the right business.

Another reason I like BB is the company's focus on connected and autonomous cars. Very little imagination is required to come up with disaster scenarios if a hacker gets control of a car, so many car companies are already working with BB to buckle up. (At the moment, BB seems to have the most traction in automotive, but I don't see why the company's stellar security chops wouldn't make it attractive to healthcare device makers, the military, aerospace, and many other markets.)

Likelihood I will regret this decision | On a scale of one to ten, with 10 being ICOULDAHADAV8, I'd say 3. Right now, BB hardly looks like a great investment. Revenue continues to decline (a result of the dying legacy business), the forward P/E is something like 50, there's debt, the competition will be fierce, etc. But, BB has over $2B in cash, a seasoned turnaround guy at the helm, and, at least for security, a very, very strong brand, which helps not only with margins but also with getting shortlisted for deals.

What would Buffett do? Pass. Buffett likes investements that look like a sure thing and BB doesn't exactly qualify, at least not at today's price.