How Do Different Industries Fare in KingsCrowd Ratings?

CHART OF THE WEEK 📈

KingsCrowd compares the average ratings of Reg CF and Reg A equity deals by industry since 2022. KingsCrowd’s proprietary algorithm rates equity crowdfunding deals on a scale of 1 to 5. The bars in grey reflect industries with less than 20 deals in the chosen time period. Small sample sizes can skew results.

• The average deal rating in the Pet, Retail, and Alcohol industries is low. Indeed, these industries tend to have stagnating and crowded markets. They lack product innovation, which minimizes investor’s potential returns on most equity deals.

• Surprisingly, the Arts and Craft industry rates highly. However, the results are skewed by the small sample size. The only three deals in this industry offer scalable marketplaces dedicated to different niches of customers.

• Deals in Farming and Agriculture industry also perform well. Most startups raising online in this industry are transforming it by using technology - like Advancing Eco Agriculture and Eden Grow System, or leveraging natural resources in a unique way - like Biodel AG and Garden for Wildlife.

• Overall, the industries that tend to rate above the 3.0 average offer scalable solutions - such as Cybersecurity, Marketing, or Business Software, or expensive products that customers depend on - such as Energy, Transportation, and Healthcare. The industries that tend to rate below the 3.0 average are usually highly competitive markets where innovation and differentiation are more difficult to achieve.

Presented by Capital Department

We're thrilled to bring you another exclusive Demo Day on December 6th 11:30am ET! This is your chance to hear directly from a diverse group of founders and ask them about their investment opportunities, rated by KingsCrowd.

Mark your calendars and sign up for our exclusive pitch event below.

PITCH REVIEW 💸

Brief: Sirocco Energy aims to introduce efficient, small wind turbines to the business and residential sectors globally, facing competition in a market often dominated by large wind farms. With turbines offering 30% more energy than rivals at nominal wind speeds, Sirocco Energy's success hinges on maintaining low energy costs for clients. It’s raising $1M at a pre-money valuation of $8.9M with a minimum investment of $100.

Key People: Sirocco Energy’s founding story is a love story. Chief Technology Officer Olexandr Pryimak launched the company with his college friend and company CEO Taras Vodyanyy with the mission to develop the ideal wind turbine. The pair incubated at the DIY Lab in Kiev, where they met Anna Pryimak. They onboarded her as the chief operating officer and the company's third co-founder. Soon after that, she and Olexandr got married.

Interested in Sirocco Energy? Access the deal report HERE 🔓📈

Summary

Here's what we like: Two elements distinguish Sirocco Energy from other small wind turbine startup investment opportunities. First, it secured 1,200 wind turbine preorders, mostly by word of mouth, in early 2023. This demonstrates a demand for the company’s unique product and that the small distributed wind turbine market might grow quickly. It also shows that the team has great execution skills, as they could get these preorders even without a finished product. Sirocco also sells wind turbines with superior performances and higher energy output than competitors. This gives it a strong competitive advantage.

Sirocco Energy’s second advantage is its business model. The company offers both sales and leasing options for customers. It removes the financial barrier that could slow the adoption of wind turbines and helps customers balance the turbine’s cost with the savings they would make on their electricity bills.

Finally, investing in wind turbine companies can be a big win for investors. In 2021, the value of merger and acquisition transactions in the wind energy space reached $210 billion. Companies in the renewable energy industry and the fossil fuel industry are acquiring wind turbine companies. While the space is fragmented and doesn’t ensure that Sirocco Energy will successfully exit, it demonstrates potentially lucrative opportunities in the wind turbine space.

Here's what we don't: Small distributed wind turbine installations in 2021 have been limited. The company still faces adoption risk even if Sirocco Energy’s early 2023 pre-sales indicate an upcoming market growth. Businesses and individual residents are not as ready as utilities to deploy wind turbines. Turbines are rare in urban areas, and communities may not want them in their spaces.

Sirocco Energy also faces manufacturing and technology risks. The company hasn’t started full-scale production and has to complete testing this year to deliver its product and start recognizing revenue.

Finally, Sirocco Energy’s growth strategy beyond its preorders is unclear. At some point, Sirocco Energy’s capacity to market its turbines and win contracts from new customers will be critical to its success.

ON THE POD 🎙️

In this episode of the Technori podcast, host Scott Kitun interviews Jeff Annison, the co-founder and president of Legion M. They discuss Annison's journey from mechanical engineering to entrepreneurship, highlighting his experiences in various startups, including a streaming mobile television venture and a music-related startup. Annison shares insights into his career transitions, the challenges he faced, and the evolution of his ventures running a fan-owned studio.

Listen to the full episode here

TOP-RATED DEALS 🌶️

Swell Health

Swell Health addresses the critical mental health challenges in the military community, where over 6,000 veterans annually died by suicide from 2008 to 2017. Their Therapy+ platform offers teletherapy, connecting service members, veterans, and their families with trained therapists skilled in various approaches, including cognitive-behavioral and psychodynamic therapy, to treat conditions like depression and PTSD. With 750 sessions since its launch and a monthly user growth of over 30%, currently operational in Tennessee and Kentucky, Swell Health aims for broader expansion.

• Valuation Cap: $8 million

• Minimum Investment: $100

BlockPower Energy Services (Debt)

BlocPower Energy Services, engaged in funding on Raise Green, specializes in energy projects for greener, healthier buildings. Leading in New York, California, and Colorado, the company focuses on energy efficiency, clean energy retrofits, and hazard remediation, driven by a skilled team.

• Interest Rate: 7.25%

• Minimum Investment: $100

Choose Your Horizon

Choose Your Horizon addresses the widespread issue of depression, affecting over 264 million people globally, with an innovative at-home psychedelic therapy. Utilizing sublingual ketamine tablets administered under telemedicine supervision, they cater to individuals with anxiety, depression, and PTSD. Already available in 13 states with $1.5 million in treatment packages sold in 2023, the company plans to expand to all 50 states by 2024.

• Pre-Money Valuation: $14.8 million

• Minimum Investment: $280