It’s transforming how the biggest generation this planet has ever seen saves — and it could disrupt the banking industry as we know it, making the traditional savings account obsolete.
Millennials are the largest generation in today’s workforce, but many struggle to save money for the goals and experiences that are meaningful to them.
Unlike previous generations who were motivated to save up for “retirement” and build long term wealth, the Millennials want to enjoy life right now. However, most financial institutions aren’t prepared to serve this new type of customer and their changing needs.
In fact, more than one-third of all Millennials choose non-traditional career paths, which can include multiple jobs, contract work, or “side hustles.”
This means they typically have a less-than-stable income stream and no easy access to the types of traditional “savings plans” their parents benefited from.
To make things more challenging, they’re also forced to contend with a high cost of living, staggering student-loan debt, and an annual salary that’s an estimated 20% less than their parents earned at their same age.
But that doesn’t mean Millennials aren’t motivated to save their money — they’re simply driven by different goals.
That’s why this massive generational cohort needs a solution that can help them get the short-term gratification they want, all while developing the valuable habit of setting — and achieving — meaningful monetary targets.
The secret to solving this puzzle?
According to the founders of Guac, the answer could be as simple as getting Millennials to “save as they spend”.
You see, unlike other FinTech companies that have “round up” savings features (which aren’t controllable by the user)…
Guac uses a percentage-based “save while you spend” technology to help users set meaningful financial goals, track and measure their progress, and save money on purchases through an in-app marketplace.
Today, you have the opportunity to be an early investor in this “lifestyle banking app” that could potentially disrupt two of the world’s most lucrative industries: Finance and Travel.
Four of them were part of the team that helped build micro-savings app Acorns into an $860 million success. They see so much potential in Guac, they’ve decided to join the management team, and have even made a strategic investment in the company.
According to Guac’s team, they are acquiring new users at an industry-low cost of $14 per completed registration. This means they have a serious competitive advantage when it comes to arguably the hardest part of achieving massive scale.
But the most exciting part of this opportunity is this: How valuable Guac’s user data could be to a potential acquirer.
Guac knows what each user is saving for… how much they’re saving… and when they want to buy it. Not only that, but users can also buy those items through in-app purchases. This means any brand looking to get access to the “Holy Grail” of next-generation customers could get it through Guac’s unique save-and-spend ecosystem.
Invest In The First lifestyle banking app for short-Term savings Goals & Life Experiences
The millennial market is a trillion-dollar opportunity…
and Guac is capitalizing on it.
Millennials represent the largest generation in US history — a staggering 83 million people. By 2025, they’ll represent 75% of the workforce and own the largest share of personal income… a whopping $8.3 trillion.
Millennials also save (and spend) differently than previous generations. They are more about the “experience economy”, and place a higher value on travel and experiences than their elders. Why? Because millennials see these items as a way of building their social currency, a top priority in the age of social media.
In fact, 47% of millennials say they would rather save for travel than for buying a house. That means more than 35 million Americans are looking to experience the “now” rather than the “later”. What’s more, a survey by the AICPA shows that over 75% of millennials want the same clothes, cars, and gadgets as their friends, and they are willing to go into debt with these purchases.
The willingness to make these purchases on credit highlights the need for a short-term savings solution. And while new micro-savings apps like Acorns are great for retirement-style savings, they aren’t designed to meet quick objectives. Guac is.
Guac helps millennials save for short-term goals like traveling, concerts, events, and other life experiences — anything the younger generation values.
It uses advanced micro-savings technology to help users literally “save while they spend” and is fully-customizable. All a user has to do is link Guac with their checking account, set a percentage to save (say 5%), and go about their daily life.
Every time they spend, the set percentage of money is automatically transferred from a user’s checking account to their Guac savings fund. Pay $30 for gas, $1.50 is transferred. $125 on groceries, $5.25 is saved.
This compares to other apps that typically use a “round-up” feature as their savings tool. This method offers little control over how much is saved, and only saves pennies at a time, making it almost impossible to reach a short-term goal.
Guac is a better solution because it helps its users meet their short-term savings goals faster, and with more freedom. Plus, it does so with no fees and with other added benefits — two major factors in a millennials banking decision. According to a survey done by fintech company Kasasa…
Guac is the only free micro-savings app with absolutely no subscription fees, no sign-up fees, and no monthly fees. Guac also offers users extra benefits usually reserved for luxury credit card holders such as an exclusive in-app marketplace.
And in fact, this in-app marketplace is the driving force behind Guac’s potential upside…
Guac’s marketplace enables users to pay for goals like travel directly from their Guac savings fund without having to leave the app or make a transfer. The seamless save-and-purchase process increases convenience relative to other micro-savings apps. Users also receive discounts on retail pricing, further incentivizing marketplace usage.
Guac is partnering with online travel agencies, concert/event providers, fashion, and tech companies to provide services in the app. Several major brands have already signed on, and discussions are ongoing with many more.
That’s not all…
Guac also rewards users with “cashback” on every purchase made in its Marketplace.
Cashback apps like Rakuten and Ibotta are hugely successful. But Guac takes the cashback experience to the next level.
Now when a user books an experience in the Guac marketplace, a certain percentage of that experience is deposited back into their Guac account, giving them an immediate boost to their savings for a future purchase.
The circular process reinforces Guac as an integral part of a millennial’s save-and-spend lifestyle. It will help improve user retention, loyalty and stickiness — all important factors for the long-term growth of the company.
All deposits are also backed by the FDIC. This means every Guac customer benefits from the same regulatory safety they would have with any savings account they’d normally open at a traditional financial institution.
With Guac, there’s little reason to ever open a traditional savings account again… and the implications of that could be tremendous.
Guac generates revenue from the benefits it gives its users. It receives a commission on each purchase and booking made through the in-app marketplace, and is in a power position to negotiate favorable rates with its partners.
You see, Guac captures and provides its partners with the most targeted millennial audience possible — it knows what a user is saving for, the amount they’re saving, and when they want to buy it. This is extremely valuable information and enables Guac to extract more revenue from its vendors.
Additionally, Guac also generates income from the interest it earns on deposits. The more users it acquires and deposits it holds, the more interest revenue it earns. Guac also charges a fee every time a user transfers money from its Guac savings fund to their checking account.
How Guac Makes Money:
Guac delivers undeniable value and benefits to their users at NO COST to them. This radical way of thinking has resulted in mass adoption and product evangelists – just look at what their members are saying:
These testimonials emphasize Guac’s early success in the market. But the team behind Guac is no stranger to success. In fact, a number of them have the impressive pedigree of being a part of the original team that built Acorns.
Founded in 2012, Acorns is a hugely successful micro-savings app that rounds-up a user’s change and invests those funds in $5 increments.
The company targets long-term savers and is one of the fastest growing fintech’s in the world, with a userbase exceeding 4.5 million users.
Last year, Acorns was valued at $860 million. Forbes also named the company to its exclusive list of fastest-growing venture-backed companies, calling it the next billion-dollar startup.
Now, four of the men who helped build Acorns into the next unicorn have joined Guac… and they’re looking to repeat that success.
Mike Paley, Scott Paley & Sami Khan
Thanks in part to these four men, early shareholders in Acorns multiplied their investments many times over. Now they’re looking to repeat that success with Guac — and you have the oportunity to join them.
With the experience learned at Acorns, Guac’s team has deployed a successful growth marketing campaign resulting in some of the lowest acquisition costs in the industry.
Guac is also working with leading social media influencers that collectively have 75 million+ followers to drive further growth. These influencers have a major impact on the millennial market and will play a key role in helping Guac “go viral”.
Every user adds value to the company and your investment. At its latest financing, Acorns had 4.5 million users and was valued at $860 million. That places a value of $191 on each user of the app.
With Guac adding more users daily — and acquiring them for as low as $14 — the potential value building inside the company for shareholders who get in today is exciting.
guac has an industry-best user acquisition cost of $14. But The potential value of each user could be as high as $191… 13-Times More than the cost to acquire.
Guac has the potential to disrupt not one… but two of the most lucrative industries on the planet, and that could have a major impact on how quickly Guac’s value rises.
In a 2019 report, traditional banks cite the number one concern is deposit drain.
Every dollar deposited with Guac is one that is sucked from another financial institution. This opens a new, never-before-seen drain on bank deposits and poses a long-term threat to traditional brick-and-mortar banks.
On top of that, Millennials are an increasingly high value target as the banks become aware of the $30 TRILLION intergenerational transfer of wealth expected over the next 10 years. The lifestyle data and purchase intent information Guac receives on every user is highly coveted.
Airlines, hotels & hospitality companies are paying commission rates of up to 25% to third parties like Expedia and Travelocity (which struggle to capture the valuable Millennial audience).
Guac will steal market share from large travel portals by charging vendors lower commission and providing them with the highly coveted Millennial audience they desire.
Fintech’s are experiencing acquisition activity at unprecedented rates. Last year set a record as the largest ever in terms of deal count AND dollar volume. And despite a coronavirus slowdown, activity in the fintech space is expected to continue to be strong.
In fact, the Fintech Times calls data “the most valuable commodity of 2020” — and that’s great news for Guac investors…
You see, Guac knows what a user is saving for. How much they’re saving. And when they want to buy it.
This is valuable data.
Plus, Guac’s micro-savings tool receives data on every transaction that goes through a user’s attached checking account, including vendor, amount, and date. To big data companies, this information is as good as gold.
Fintech Companies Are Getting Snatched-up For Billions:
“For a while, the world’s banking giants largely ignored them. Now they’re starting to feel the heat—and fighting back with the most formidable weapon in their arsenals: cash.”
But that’s not all. Guac has the potential to shake the foundations of trillion-dollar industries. Remember…
Guac understands that hardships triggered by a global crisis often last for years. But it also believes ingenuity driven by the necessities of coping with (and surviving) a crisis could give birth to an economy that’s more robust and successful than anything in the past.
Think back to the 2008 financial crisis. Dozens of billion-dollar-plus companies were born in its wake, making fabulous wealth for visionary investors who saw and moved quickly to support potential in companies that no one yet knew.
Companies like Instagram, WhatsApp, Uber, Airbnb, Pinterest, Groupon, and many others emerged from the hard times of that financial crisis.
(Based on data compiled from CBInsights, Pitchbook, and Crunchbase)
And these disruptors weren’t just lucrative for shareholders in the long-term… The value of these companies spiked early, often within months of the initial seed/angel round raises. Here’s the valuation trajectory during early financings…
(Based on data compiled from CBInsights, Pitchbook, and Crunchbase)
It’s not just Acorns alumni backing Guac. The company is stacked with top-notch professionals that have built and sold companies before.
Scott Armstrong – Founder + President
Ryan Armstrong – Co-Founder + Vice President
Rich Ingrassia – Director + Strategic Finance
Thomas Marquart – Digital Marketing Lead
Investment Documents, Risks & Disclosures
A crowdfunding investment involves risk. You should not invest any funds in this offering unless you can afford to lose your entire investment.
In making an investment decision, investors must rely on their own examination of the issuer and the terms of the offering, including the merits and risks involved. These securities have not been recommended or approved by any federal or state securities commission or regulatory authority. Furthermore, these authorities have not passed upon the accuracy or adequacy of this document.
The U.S. Securities and Exchange Commission does not pass upon the merits of any securities offered or the terms of the offering, nor does it pass upon the accuracy or completeness of any offering document or literature.
These securities are offered under an exemption from registration; however, the U.S. Securities and Exchange Commission has not made an independent determination that these securities are exempt from registration.
An investment in the Company involves a high degree of risk. You should carefully consider the risks described above and those below before deciding to purchase any securities in this offering. If any of these risks actually occurs, our business, financial condition or results of operations may suffer. As a result, you could lose part or all of your investment.
Risks Related to the Company
Our business, results of operations, and financial condition may be impacted by the recent coronavirus (COVID-19) outbreak.
With respect to the ongoing and evolving coronavirus (COVID-19) outbreak, which was designated as a pandemic by the World Health Organization on March 11, 2020, the outbreak has caused substantial disruption in international and U.S. economies and markets. The outbreak has potential to have an adverse impact on the fintech industry and, if repercussions of the outbreak are prolonged, could have a significant adverse impact on our business, which could be material. Our management cannot at this point estimate the impact of the outbreak on its business and no provision for this outbreak is reflected in the accompanying financial statements.
We are an early stage company, with limited operating history.
We are a startup company. We were formed as a corporation in California on August 21, 2017. We have a limited operating history with which you can evaluate our business and prospects. Our prospects must be considered in light of the risks encountered by companies in the early stages of development in highly competitive markets, particularly the markets for financial technology, or fintech, companies, software and mobile applications. You should consider the frequency with which early-stage businesses encounter unforeseen expenses, difficulties, complications, delays and other adverse factors. These risks are described in more detail below.
We have a history of losses. If we do not become profitable or maintain profitability in the future, we may not be able to continue to operate.
We have not been profitable in the past. We have not generated any significant revenues to date. Before we are able to generate any material level of revenues, we will incur significant additional losses. We expect to substantially increase our sales and marketing, research and development and general and administrative expenses. As a result, we will need to generate significant revenues to achieve and maintain profitability in the future. We cannot assure you that we will achieve profitable operations or maintain them if achieved. Failure to achieve or maintain profitability will materially and adversely affect our business.
Our app is based on new technologies and is subject to the risks of failure inherent in the development of a new product.
Because our app is based on new technologies, it is subject to risks of failure that are particular to new technologies, including the possibility that:
As a result, our activities may not result in a commercially viable product and our sales, revenue and financial condition would be materially adversely affected.
If we are unable to maintain a good relationship with the markets where our app is distributed, our business will suffer.
Apple’s “App Store” and Google’s “Google Play” will be the primary distribution, marketing, and promotional platforms for our app. Our app and related service is only made available through these platforms and any deterioration in our relationship with Apple or Google would harm our business and adversely affect the value of our stock.
We are subject to Apple’s and Google’s standard terms and conditions for application developers, which govern the promotion, distribution and operation of apps on their platforms.
Our business would be harmed if:
We could benefit from Apple and Google’s strong brand recognition and large user base. If Apple or Google loses its market position or otherwise falls out of favor with users, we would need to identify alternative channels for marketing, promoting and distributing our app, which would consume substantial resources and may not be effective. In addition, Apple and Google have broad discretion to change their terms of service and other policies with respect to us and other developers, and those changes may be unfavorable to us. Any such changes in the future could significantly alter how our app users experience our app or interact within our app, which may harm our business.
Major network failures could have an adverse effect on our business.
Our technology infrastructure is critical to the performance of our app and customer satisfaction. Our app runs on a complex distributed system, or what is commonly known as cloud computing. We own, operate and maintain the primary elements of this system, but third parties that we do not control and which would require significant time to replace operate some elements of this system. We expect this dependence on third parties to continue. Major equipment failures, natural disasters, including severe weather, terrorist acts, acts of war, cyber attacks or other breaches of network or information technology security that affect third-party networks, communications switches, routers, microwave links, cell sites or other third-party equipment on which we rely, could cause major network failures and/or unusually high network traffic demands that could have a material adverse effect on our operations or our ability to provide service to our customers. These events could disrupt our operations, require significant resources to resolve, result in a loss of customers or impair our ability to attract new customers, which in turn could have a material adverse effect on our business, prospects, results of operations and financial condition.
If we experience significant service interruptions, which could require significant resources to resolve, it could result in a loss of customers or impair our ability to attract new customers, which in turn could have a material adverse effect on our business, prospects, results of operations and financial condition.
In addition, with the growth of wireless data services, enterprise data interfaces and Internet-based or Internet Protocol-enabled applications, wireless networks and devices are exposed to a greater degree to third-party data or applications over which we have less direct control. As a result, the network infrastructure and information systems on which we rely, as well as our customers’ wireless devices, may be subject to a wider array of potential security risks, including viruses and other types of computer-based attacks, which could cause lapses in our service or adversely affect the ability of our customers to access our service. Such lapses could have a material adverse effect on our business, prospects, results of operations and financial condition.
If our proposed technologies are not accepted by the market our business prospects will suffer.
To support our business plan, we must develop technologies, develop strong brands and make significant capital investments. Should we invest in or design technologies that are not accepted in the marketplace, or if our technologies are not brought to the market in a timely manner, this could materially and adversely impact our company.
There is no assurance that there is a market for our technologies, the size of the market, or the market’s acceptance of our applications. Sales outcomes are based upon a variety of factors which cannot be assured. If we fail to successfully develop and commercialize our applications, or if the applications are not accepted by the market, our business prospects will suffer.
Our business model is dependent on user growth and developing strategic partnerships to fuel user growth. If we are not successful in developing these partnerships our business plan will fail and our financial condition, operations and prospects will be adversely affected.
We depend on establishing and maintaining licensing, co-brand and revenue sharing relationships with high-traffic web sites and other technology providers. Increasing the number of these relationships is a key element of our strategic plan. Our business could be adversely affected if we do not establish and maintain additional strategic relationships on commercially reasonable terms or if any of our strategic relationships do not result in increased use of our web sites or additional revenues.
We currently have only nominal verbal commitments from strategic partners that could engage in our marketplace or on whose platform or application we can engage. If we are not able to convert these verbal commitments into binding agreements and expand the number of such agreements, we may have significant difficulty in expanding our user base. Failure to expand our user base would result in our inability to generate any significant level of revenues and our financial condition, operations and prospects would be materially adversely affected. Accordingly, there is no guarantee that we will generate any material level of revenues from advertising or through strategic partnerships.
Defects in our app and the technology powering our technological platform may adversely affect our business.
Tools, code, subroutines and processes contained within our app may contain defects when introduced and also when updates and new versions are released. If our app or an update to our app contains defects or quality problems, we may become subject to adverse publicity, reduced use of our app, product redevelopment costs, loss of or delay in market acceptance of our product or claims by customers or others against us. Such problems or claims may have a material and adverse effect on our business, prospects, financial condition and results of operations.
If third parties claim that we infringe their intellectual property, it may result in costly litigation.
We cannot assure you that third parties will not claim that our current or future products or services infringe their intellectual property rights. Any such claims, with or without merit, could cause costly litigation that could consume significant management time. Such claims also might require us to enter into royalty or license agreements. If required, we may not be able to obtain such royalty or license agreements, or obtain them on terms acceptable to us.
Failure to comply with federal and state privacy laws and regulations, or the expansion of current or the enactment of new privacy laws or regulations, could adversely affect our business.
A variety of federal and state laws and regulations govern the collection, use, retention, sharing and security of consumer data. The existing privacy-related laws and regulations are evolving and subject to potentially differing interpretations. In addition, various federal, state and foreign legislative and regulatory bodies may expand current or enact new laws regarding privacy matters. For example, recently there have been Congressional hearings and increased attention to the capture and use of location-based information relating to users of smartphones and other devices. Several Internet companies have incurred penalties for failing to abide by the representations made in their privacy policies and practices. In addition, several states have adopted legislation that requires businesses to implement and maintain reasonable security procedures and practices to protect sensitive personal information and to provide notice to consumers in the event of a security breach. Any failure, or perceived failure, by us to comply with our posted privacy policies or with any data-related consent orders, Federal Trade Commission requirements or orders or other federal, state or international privacy or consumer protection-related laws, regulations or industry self-regulatory principles could result in claims, proceedings or actions against us by governmental entities or others or other liabilities, which could adversely affect our business. In addition, a failure or perceived failure to comply with industry standards or with our own privacy policies and practices could adversely affect our business. Federal and state governmental authorities continue to evaluate the privacy implications inherent in the use of third-party web “cookies” for behavioral advertising. The regulation of these cookies and other current online advertising practices could adversely affect our business.
We face severe competition from other technology companies that provide event driven micro saving applications to consumers and if we cannot compete effectively our business and financial condition will suffer.
We face, and will continue to face, intense competition from technology companies that provide event driven micro savings applications like our mobile application to consumers. Many of our competitors have substantially greater financial, technical, research, marketing, sales, service and other resources than us, and may develop processes or software applications that are superior to those of our company. The competitors may succeed in obtaining patent protection for their software applications before us. If our competitors develop software applications or technologies that are more effective than ours or that render our applications or technologies obsolete or noncompetitive, our business will suffer.
Our proposed technologies and other information services may become obsolete as a result of technological change and, if so, our financial condition and business will suffer.
Our future success will depend on our ability to maintain a competitive position with respect to technological advances. Our existing or prospective competitors may develop processes or applications that are more effective than ours or which may be more effective at implementing their technologies to develop commercial applications faster, which could in turn render our technology obsolete or noncompetitive.
In order for our business strategy to succeed we must retain qualified personnel. Our failure to do so will negatively affect our business growth and prospects.
Recruiting and retaining qualified professionals to develop applications, as well as sales, marketing and financial professionals, is critical to the future success of our. We intend to hire additional professionals. Competition for experienced personnel is intense, and the turnover rate can be high. Our failure to attract and retain professionals would prevent us, or hinder its ability to pursue, our business plan and grow our business.
Damage to our reputation could adversely impact our business.
Maintaining our reputation is critical to our ability to attract and retain customers and employees. If we fail to deal with, or appear to fail to deal with, various issues that may give rise to reputational risk, we could significantly harm our business prospects. These issues include, but are not limited to, dealing with legal and regulatory requirements, money-laundering, privacy, record keeping, sales practices, and the proper identification of the legal, reputational, credit, liquidity, and market risks inherent in the micro-savings programs that we offer to our customers. A failure to deliver appropriate standards of service and quality, or a failure or perceived failure to treat clients fairly, can result in customer dissatisfaction, litigation and heightened regulatory scrutiny, all of which can lead to lost revenue, higher operating costs and harm to our reputation. Further, negative publicity regarding us, whether or not true, may also harm our business.
We depend on certain key personnel, including our President, Scott Armstrong. The loss of any of these key personnel would have a material adverse impact on our business, financial condition and future prospects.
The success of our company is highly dependent upon certain key management, including our President, Scott Armstrong. The loss of the services of this employee could have a material adverse effect on our business, financial condition, and the results of its operations. There can be no assurance that this employee will remain with our company in the future due to circumstances either within or outside of their control. Further, we do not carry, and do not intend to carry, life insurance or key man insurance on its employees.
We may not be able to manage future growth effectively.
If our business plan is successful, we may experience significant growth in a short period of time and potential scaling issues. Should we grow rapidly, our financial, management and operating resources may not expand sufficiently to adequately manage our growth. If we are unable to manage our growth, our costs may increase disproportionately, our future revenues may stop growing or decline and we may face dissatisfied customers. Our failure to manage our growth may adversely impact our business and the value of your investment.
Our business model is not proven, and we may have to change our business model, which can result in delays in the execution of our business plan. If our business model is ultimately unsuccessful, our company’s financial condition and business will suffer materially.
Our business model and operating strategies are unproven. Additionally, the business model may place significant strain on our management, employees, and capital resources. Finally, we may modify and adapt our business model from time to time in material ways, including raising more or less capital and/or incurring more or less debt, depending upon a variety of factors, including without limitation, the amount of capital available to us, the failure and/or success of our company and the availability of management and technology.
Adverse publicity may negatively affect our business.
We are highly dependent upon consumers’ perception of our services. As a result, substantial negative publicity concerning our services or the services of other providers who are similar to us could lead to a loss of consumer confidence in our services and reduced sales and prices of our subscriptions. Any of these events could have a material adverse effect on our business, financial condition or result of operations.
Systems failures could significantly disrupt our business.
Our business depends on our ability to effectively provide financial markets information utilizing our technology platform. We also rely heavily on our communications and financial, accounting and other data processing systems, including systems we maintain and systems provided to us by third parties. We face operational risk arising from mistakes made in the delivery of this information. If any of these systems do not operate properly or are disabled, we could suffer financial loss, a disruption of our business, liability to clients, regulatory intervention and fines or reputational damage. Any failure or interruption of our systems, the systems of third parties that we rely upon or similar problems could have a material adverse effect on our future operating results.
Risks Related to the Company’s Securities and this Offering
Affiliates of our company, including officers, directors and existing stockholder of our company, may invest in this offering and their funds will be counted toward our achieving the minimum amount.
There is no restriction on our affiliates, including our officers, directors and existing stockholders, investing in the offering. As a result, it is possible that if we have raised some funds, but not reached the minimum amount, affiliates can contribute the balance so that there will be a closing. The minimum amount is typically intended to be a protection for investors and gives investors confidence that other investors, along with them, are sufficiently interested in the offering and our company and its prospects to make an investment of at least the minimum amount. By permitting affiliates to invest in the offering and make up any shortfall between what non-affiliate investors have invested and the minimum amount, this protection is largely eliminated. Investors should be aware that no funds other than their own and those of affiliates investing along with them, may be invested in this offering.
We intend to use some of the proceeds from the offering for unspecified working capital.
This means that we have ultimate discretion to use this portion of the proceeds as we see fit and have chosen not to set forth any specific uses for you to evaluate. The net proceeds from this offering will be used for the purposes, which our management deems to be in our best interests in order to address changed circumstances or opportunities. As a result of the foregoing, our success will be substantially dependent upon our discretion and judgment with respect to application and allocation of the net proceeds of this offering. We may choose to use the proceeds in a manner that you do not agree with and you will have no recourse. A use of proceeds that does not further our business and goals could harm our company and its operations and ultimately cause you to lose all or a portion of your investment.
We are not subject to Sarbanes-Oxley regulations and lack the financial controls and safeguards required of public companies.
We do not have the internal infrastructure necessary, and are not required, to complete an attestation about our financial controls that would be required under Section 404 of the Sarbanes-Oxley Act of 2002. There can be no assurance that there are no significant deficiencies or material weaknesses in the quality of our financial controls. We expect to incur additional expenses and diversion of management’s time if and when it becomes necessary to perform the system and process evaluation, testing and remediation required in order to comply with the management certification and auditor attestation requirements.
The securities being sold in this offering will not be freely tradable until one year from the initial purchase date. Although our securities may be tradable under federal securities law, state securities regulations may apply, and each investor should consult with his or her attorney.
You should be aware of the long-term nature of this investment. There is not now and likely will not be a public market for our securities. Because our securities have not been registered under the Securities Act or under the securities laws of any state or non-United States jurisdiction, our securities have transfer restrictions and cannot be resold in the United States except pursuant to Rule 501 of Regulation CF. It is not currently contemplated that registration under the Securities Act or other securities laws will be effected. Limitations on the transfer of the securities may also adversely affect the price that you might be able to obtain for our securities in a private sale. Investors should be aware of the long-term nature of their investment in the Company. Each investor in this offering will be required to represent that it is purchasing the securities for its own account, for investment purposes and not with a view to resale or distribution thereof.
Neither the offering nor the securities have been registered under federal or state securities laws, leading to an absence of certain regulation applicable to us.
No governmental agency has reviewed or passed upon this offering, our company or any Securities of our company. We also have relied on exemptions from securities registration requirements under applicable state securities laws. Investors, therefore, will not receive any of the benefits that such registration would otherwise provide. Prospective investors must therefore assess the adequacy of disclosure and the fairness of the terms of this offering on their own or in conjunction with their personal advisors.
No Guarantee of Return on Investment
There is no assurance that an investor will realize a return on its investment or that it will not lose its entire investment. For this reason, each investor should read the Form C and all Exhibits carefully and should consult with its own attorney and business advisor prior to making any investment decision.
A majority of our company is owned by a small number of owners.
Prior to the offering our officers, directors and those of our stockholders who own ten percent or more of our securities collectively own directly or indirectly approximately 90% of our company. Subject to any fiduciary duties owed to our other owners or investors under California law in the case of our officers and directors, these stockholders may be able to exercise significant influence over matters requiring owner approval, including the election of directors or managers and approval of significant company transactions, and will have significant control over our management and policies. These control persons may have interests that are different from yours. For example, they may support proposals and actions with which you may disagree. The concentration of ownership could delay or prevent a change in control of our company or otherwise discourage a potential acquirer from attempting to obtain control of the Company, which in turn could reduce the price potential investors are willing to pay for our company. In addition, this owner could use his voting influence to maintain the Company’s existing management, delay or prevent changes in control of our company, or support or reject other management and board proposals that are subject to owner approval.
We have the right to extend the offering deadline.
We may extend the offering deadline beyond what is currently stated herein. This means that your investment may continue to be held in escrow while we attempt to raise the minimum amount even after the offering deadline stated in this offering statement is reached. Your investment will not be accruing interest during this time and will simply be held until such time as the new offering deadline is reached without our company receiving the minimum amount, at which time committed funds will be returned without interest or deduction, or until we receive the minimum amount, at which time it will be released to us to be used as set forth herein. Upon or shortly after release of such funds to us, the securities will be issued and distributed to you.
Your ownership of the shares will be subject to dilution.
If we conduct subsequent offerings of securities, issue shares pursuant to a compensation or distribution reinvestment plan or otherwise issues additional shares, investors who purchase securities in this offering who do not participate in those other stock issuances will experience dilution in their percentage ownership of our company’s outstanding shares. Furthermore, shareholders may experience a dilution in the value of their underlying shares depending on the terms and pricing of any future share issuances (including the underlying shares being sold in this offering) and the value of the our assets at the time of issuance.
Management has discretion over proceeds of this offering.
We expect to use the net proceeds of this offering, over time, for general marketing and advertising, further software development and general corporate and working capital purposes. However, we have no current specific plans for the net proceeds of this offering other than as outlined in the use of proceeds section of this offering statement. As a result, our management will have the discretion to allocate the net proceeds to uses that investors may not deem desirable. There can be no assurance that the net proceeds can or will be invested to yield a significant return.
The securities will be equity interests in our company and will not constitute indebtedness.
The securities will rank junior to all existing and future indebtedness and other non-equity claims on our company with respect to assets available to satisfy claims on the Company, including in a liquidation of our company. Additionally, unlike indebtedness, for which principal and interest would customarily be payable on specified due dates, there will be no specified payments of dividends with respect to the securities and dividends are payable only if, when and as authorized and declared by us and depend on, among other matters, our historical and projected results of operations, liquidity, cash flows, capital levels, financial condition, debt service requirements and other cash needs, financing covenants, applicable state law, federal and state regulatory prohibitions and other restrictions and any other factors our board of directors deems relevant at the time. In addition, there is no limit on the amount of debt or other obligations we may incur in the future. Accordingly, we may incur substantial amounts of additional debt and other obligations that will rank senior to the securities, which are the most junior securities of our company.
There can be no assurance that we will ever provide liquidity to investors through either a sale of our company or a registration of the securities.
There can be no assurance that any form of merger, combination, or sale of our company will take place, or that any merger, combination, or sale would provide liquidity for investors. Furthermore, we may be unable to register the securities for resale by investors for legal, commercial, regulatory, market-related or other reasons. In the event that we are unable to effect a registration, investors could be unable to sell their securities unless an exemption from registration is available.
The offering price in this offering may not represent the value of our securities.
The price of the securities being sold in this offering has been determined based on a number of factors and does not necessarily bear any relationship to our book value, assets, operating results or any other established criteria of value. Prices for our securities may not be indicative of the fair market value of our securities now or in the future.
The next 8 slides will allow us to process your investment. Note that these next steps are a legal requirement – Thank you for your patience and financial support of this investment opportunity. Jordan Gillissie – CEO
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