Peek into KingsCrowd Capital’s Portfolio

Editor’s Note: With the upcoming holidays, there will be no Pitch Reviews newsletter next week. We’ll be back on Tuesday, January 2nd. See you in 2024!

CHART OF THE WEEK 📈

At KingsCrowd, we place utmost confidence in our proprietary ratings algorithm, which is why we established KingsCrowd Capital. As the fund arm of KingsCrowd, we directly invest in companies identified through our robust ratings system.

Should you aspire to align your investments with KingsCrowd Capital, explore companies marked with a crown on our home page that are denoted as "Top Deals." These companies have secured funding from KingsCrowd Capital. Look for an additional section in the analyst report elaborating on the rationale behind our investment decisions.

This week, we took a closer look at these portfolio companies:

• Our KingsCrowd Capital portfolio currently comprises 24 companies, with an additional follow-on round in YellowPay.

• The average rating for KingsCrowd-backed companies stands at an impressive 4.64.

• The average pre-money valuation/valuation cap at the round we invested was $29.4 million.

• The top three crowdfunding platforms for KingsCrowd-backed companies were Wefunder, StartEngine, and Republic, with 12, 9, and 3 commitments, respectively.

• Our investment portfolio includes 10 deals offering Simple Agreements for Future Equity (SAFEs), 7 with preferred equity, 4 featuring convertible notes, and 3 common equity deals.

• Among the industries in our portfolio, Healthcare & Pharmaceuticals, Financial & Insurance Products & Services, Consumer Products, Goods & Services, and Energy, Power, & Natural Resources each have three companies.

Together with Sonic Power

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PITCH REVIEW 💸

Brief: Azolla is tackling the fashion industry's pollution crisis, responsible for 10% of global carbon emissions and extensive textile waste. Their process transforms CO2 emissions into carbon-negative textiles through industrial photosynthesis, reducing CO2 by three pounds per pound of material produced. Catering to the trillion-dollar textile market, Azolla provides fashion businesses a pathway to meet net-zero goals sustainably, offering consumers eco-friendly clothing options and fostering a greener future. It’s raising $124,000 with a valuation cap of $5M with a discount of 20% and a minimum investment of $250.

Key People: Azolla is led by co-founders Lubica Hanacek and Milan Hanacek. Lubica is the company's CEO, bringing 30 years of fashion industry experience. With her managerial skills and expertise, she is well-equipped to lead Azolla in its mission to convert harmful carbon dioxide into usable products and create carbon-negative textiles. Milan, as the CTO, leads the development and technological aspects of the company. However, as a professional architect, it is unclear how he developed the skills necessary to build the company's technology.

Interested in Azolla? Access the deal report HERE 🔓📈

Summary

Here's what we like: Azolla is revolutionizing the apparel and fashion industry by converting harmful carbon dioxide into carbon-negative textiles thanks to its unique genetically engineered bacteria. Every pound of Azolla's biodegradable material removes three pounds of CO2 from the air and only requires a bit of water and artificial light. The company's solution is mitigating climate change and creating a new material superior to polyester and cotton.

This innovative approach, deployed through a licensing model, can allow fashion businesses to meet their net-zero goals without compromising profitability, making sustainability a viable and attractive option. Azolla's product cost is competitive with cotton and polyester. Moreover, the company's fiber can bring exceptional returns if sold as an alternative to expensive fabrics, such as those used in the medical field.

The company is opening a door into the trillion-dollar global fashion market. With a high market potential and barriers to entry, Azolla is well-positioned to capture a significant share of the sustainable fashion market. Azolla is currently raising at a fair valuation cap of $5 million.

Here's what we don't: Azolla faces competition from startups pursuing various techniques to produce carbon-absorbing fibers, such as LanzaTech, Rubi Laboratories, Algaeing, Fairbrics, and Dyecoo. Some of these competitors, like Rubi Laboratories, have already made significant strides in developing sustainable alternatives for the textile market and have a head start regarding funding and pilots with potential customers, such as Walmart.

Investing in Azolla's innovative technology is still very risky at this stage. The startup will need to raise more capital as it needs about two more years before starting to generate revenues. The founders will also have to execute quickly on their future milestones and file a provisional patent to protect their technology from competitors.

ON THE POD 🎙️

In this episode of Inside Startup Investing, Chris engages with John Kempf, the founder of Advancing Eco Agriculture. The discussion centers on the company's innovative approach to agriculture, emphasizing sustainable farming techniques and the enhancement of plant health. Kempf, with his unique background, brings valuable insights into the agricultural sector's evolution towards more environmentally friendly and efficient practices.

Listen to the full episode here

TOP-RATED DEALS 🌶️

Peak Ski Company

Peak Ski Company is innovating the ski industry by leveraging proprietary KeyHole Technology and Olympian Bode Miller’s design expertise. These unique all-mountain skis feature a distinctive cutaway, driving the company's early success with 4,000 skis sold and $3 million in first-year revenue.

• Valuation Cap: $36 million

• Minimum Investment: $250

Owl Spoon Water Kefir (Debt)

Owl Spoon Water Kefir, based in Richmond, Virginia, specializes in crafting fermented water kefir beverages. Targeting health-conscious consumers, it has reached $200,000 in revenue in 2023 and aims to double this in the next two years. Emphasizing sustainability, the company has successfully reused over 25,000 glass bottles through its return program.

• Interest Rate: 12.25%

• Minimum Investment: $100

MySlabs

MySlabs is revolutionizing the collectibles market with its peer-to-peer online marketplace, addressing the longstanding fraud and transparency issues. By offering tools like market data and comparison shopping, it empowers users to make informed decisions. The platform's rigorous vetting of buyers and sellers enhances trust, greatly minimizing fraud. Since its 2018 launch, MySlabs has become a reliable name in the sports card industry, adapting to the growing trend of online collectible trading.

• Valuation Cap: $10 million

• Minimum Investment: $100