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EnergyFunders

Financial technology platform for online energy investing.

EnergyFunders is offering securities under both Regulation D and Regulation CF through SI Securities, LLC ("SI Securities"). SI Securities is an affiliate of SeedInvest Technology, LLC, a registered broker-dealer, and member FINRA/SIPC. SI Securities will receive cash compensation equal to 7.50% of the value of the securities sold and equity compensation equal to 5.00% of the number of securities sold. Investments made under both Regulation D and Regulation CF involve a high degree of risk and those investors who cannot afford to lose their entire investment should not invest. Furthermore, the contents of the Highlights, Term Sheet sections have been prepared by SI Securities and shall be deemed broker-dealer communications subject to FINRA Rule 2210 (the “Excluded Sections”). With the exception of the Excluded Sections noted above, this profile contains offering materials prepared solely by EnergyFunders without the assistance of SI Securities, and not subject to FINRA Rule 2210 (the “Issuer Profile”). The Issuer Profile may contain forward-looking statements and information relating to, among other things, the company, its business plan and strategy, and its industry. Investors should review the risks and disclosures in the offering's draft. The contents of this profile are meant to be a summary of the information found in the company’s Form C. Before making an investment decision, investors should review the company’s Form C for a complete description of its business and offering information, a copy of which may be found both here and below.


Company Highlights

  • $5.5M+ Raised for Oil and Gas Projects to Date.
  • Strong social media presence with 22.9K Twitter Followers and 14.5K Facebook Followers.
  • $225,000 Average Investment Per Project to Date.
  • Featured in Forbes, Barron’s, CNBC, and the Huffington Post, among others.

Fundraise Highlights

  • Total Amount Raised: US $585,363
  • Total Round Size: US $1,070,000
  • Raise Description:  Bridge
  • Minimum Investment:  US $1,000 per investor
  • Security Type:  Crowd Note
  • Valuation Cap:  US $10,000,000
  • Offering Type:   Side by Side Offering

EnergyFunders is democratizing energy investments to make energy more sustainable. By offering benefits in speed, access, and efficiency compared to traditional transactions, EnergyFunders is becoming a leading way to finance and invest in energy.


Summary of the Business

EnergyFunders is a financial technology company that provides users the opportunity to invest into energy-related projects utilizing its internet-based application platform.

The Company raises funding for its venture capital funds that invest into individual oil and gas exploration and production projects under the name EnergyFunders Black. It earns carried interest and fees from each of the separate projects similar to venture capital funds. Investors into the projects receive access to pre-vetted oil and gas exploration and production wells, brought to us by experienced developers.

The Company also operates a registered crowdfunding portal using Regulation CF called EnergyFunders Marketplace, and it raises funding for promising energy technology and alternative energy companies. We plan to take a fee on funds raised, similar to what other crowdfunding portals charge, plus reimbursement of certain expenses.

The Opportunity

There is a significant funding gap for companies raising under $10 million in the energy industry. It is especially acute for raises under $5 million. Energy companies with new ideas and technologies are unable to get their concepts to market fast enough or even off the ground. Venture Capital investments by banks, private equity, and venture capital firms, have declined by 30% in this sector over the past 5 years, leaving a void in energy-focused start-up capital funding.

With the introduction of new crowdfunding laws and the EnergyFunders platform, energy entrepreneurs can now seek funding for their ideas, concepts, and innovations from friends, family, customers, and the public at large. EnergyFunders has multiple tools: Reg CF ($1.07MM cap; accredited and non-accredited), Reg D (unlimited raise; accredited only), and eventually Reg S (international) and Reg A+ ($50MM cap; accredited and non-accredited). Today, a Reg CF raise and Reg D raise (506(c)) can be done concurrently, side-by-side.

Customer Base

Our customers are oil and gas exploration teams, accredited investors looking to make direct investments into energy investment opportunities, energy technology companies, and accredited and non-accredited investors looking to make investments into energy technology companies.

For Investors

EnergyFunders Marketplace is a SEC-registered, FINRA-member Funding Portal dedicated to democratizing access to promising energy investments. EnergyFunders takes advantage of the paradigm shifting changes in regulations and online investing and stands at the intersection of securities laws, equity crowdfunding, and technology. 

Gone are the days when the only way to invest in energy was through retail stocks and funds.  EnergyFunders now makes it possible to open a free account, review opportunities using transparent data, and make direct investments in a simple, secure environment.

EnergyFunders provides investors with access to projects traditionally reserved for the wealthy or industry insiders. Our mission is to provide investors from all backgrounds and geographies access to various types of energy investments.

Rather than just consuming the energy products and retail stocks and funds offered by the dominant mega-corporations, you can now have a direct influence over which energy projects and innovative energy startups will succeed in the marketplace by directly funding their growth. In return, you'll become a stakeholder and have an opportunity to reap the rewards that were previously only available to the ultra-wealthy and elite industry insiders. 

EnergyFunders provides Investors with:

  • Simplified energy investing through innovation.
  • Direct access to top-tier private energy producers and technologies.
  • Investments in environmental leaders and tech companies that help to make energy more sustainable.

For Fundraisers

Energy companies in need of startup or growth funding can use the EnergyFunders' equity crowdfunding platform to raise or attract much-needed project capital without the hassles and difficulties associated with traditional fundraising.

By opening up investment access to leading energy, environmental, and tech companies through our crowdfunding platform, EnergyFunders is changing the way the $1.2 trillion energy industry is funded, produced, and distributed.  Combined with our proprietary blockchain technology, we're converting ownership of energy assets from a traditionally expensive and time-consuming process into a simple, streamlined transaction that's as easy as point and click.

Technology

EnergyFunders has built, and continues to  improve, a platform to facilitate the company/project submission process on the portal to automate as much as we can to ensure a clean, low-touch process that will guide issuers through. The technology platform is based on the latest technology to provide investors and Energy Companies with access to energy projects and innovative energy startups. 

Benefits of EnergyFunders’ Blockchain Technology Will Include:

  • Efficiency and Optimization - Bringing liquidity to an illiquid energy market, allowing transactions to occur more safely and quickly, and opening up a secondary market.
  • Accountability - Providing immutability and transparency for transactions, creating an audit trail for investors, and regulation compliance.
  • Enhanced security - Securing via cryptography all relevant details of each transaction, which are independently, cryptographically verified.

EnergyFunders’ blockchain technology anticipates broadening the energy investment market to include all legally permitted users around the world with built-in regulatory and legal compliance as appropriate for each user’s country of residence.  We believe that EnergyFunders users will eventually experience a true borderless trading environment with a resulting reduction in transaction costs.

“In addition to enabling ground-level access to opportunities for investors, our block chain technology will offer a new, critical transparency along with greatly reduced transaction times compared to traditional transactions.” - Aalok Shah, CTO at EnergyFunders.com

Pitch Deck

Product & Service

Fundraisers

For Energy focused companies looking to raise capital for Oil & Gas, Solar, Wind, Hydro, BioFuels, Geothermal, Robotics, Fuel Cells, Green Energy, and Tech projects, we offer:

  • A Platform for Simplified and Cost Effective Capital Raising
  • Exposure to Energy Focused Investors
  • Ability to Allow Your Customers to Get a Piece of the Action

Our funding model for energy operators can be broken down into 3 easy steps:

  1. Start your campaign
    Tell your friends, family, and customers. Get exposure to our crowd and network of Energy-focused tech family offices, VC's, and angel funds.
  2. Launch it to the world
    We tell our crowd, blast it out on our social media outlets, email lists, podcasts and marketing partners. (Subject to regulations.)
  3. Get funded & back to work
    Time to put the money to work and grow your business.

Investors

Becoming a member of the EnergyFunders investor community provides:

  • Direct access to energy investments: You'll discover opportunities to invest with entrepreneurs throughout the energy space.
  • Diversity in your energy portfolio: You can diversify across multiple companies with lower cost investments. Create your own portfolio of energy investments.

  • A smaller footprint: Our platform will play a big role in fashioning the future of energy and providing our children with a cleaner and brighter future.

Media Mentions

Team Story

The EnergyFunders founders came together in 2013 with a dedication to honesty and transparency, and the foresight that bringing down the barriers to entry when investing directly in oil and gas would yield demand worldwide. They had seen the bombastic sales pitches, the opaque corporate investments, and the high bar to entry which prevented everyday investors from taking advantage of one of the greatest creators of wealth over the last century. Following FINRA's acceptance of EnergyFunders Marketplace in January 2018 as one of the first energy-focused equity crowdfunding platform in history, investors of all backgrounds can now invest in all types of energy with well-vetted operators on the groundbreaking EnergyFunders Marketplace platform. 

Founders and Officers

With an extensive background that encompasses 15 years of experience across technology, commercial real estate and energy, Casey brings deep knowledge and experience growing early-stage ventures into hyper-growth scalable organizations. He has been a part of three successful start-up companies, most recently growing startup iWowWe from zero to twelve million dollars in revenue in less than 2 years. With years of experience serving as an advisor to the startup community, he brings a strong history of building teams and developing systems and processes that scale organizations by identifying and optimizing their unique growth potential.

Casey Minshew

CEO

With an extensive background that encompasses 15 years of experience across technology, commercial real estate and energy, Casey brings deep knowledge and experience growing early-stage ventures into hyper-growth scalable organizations. He has been a part of three successful start-up companies, most recently growing startup iWowWe from zero to twelve million dollars in revenue in less than 2 years. With years of experience serving as an advisor to the startup community, he brings a strong history of building teams and developing systems and processes that scale organizations by identifying and optimizing their unique growth potential.

As the lead strategist and architect for the EnergyFunders platform and overall website, Michael’s goal is to create a framework, marketing strategies, and streamlined operations that will allow for maximum scalability of the company. A seasoned corporate law attorney, Michael has been invaluable in creating a transparent, compliant crowdfunding platform that serves both the investors and operators.

Michael Racusin

CIO

As the lead strategist and architect for the EnergyFunders platform and overall website, Michael’s goal is to create a framework, marketing strategies, and streamlined operations that will allow for maximum scalability of the company. A seasoned corporate law attorney, Michael has been invaluable in creating a transparent, compliant crowdfunding platform that serves both the investors and operators.

A seasoned litigation attorney, he has successfully represented clients, ranging from individuals to large companies, in a variety of legal disputes for nearly a decade. He also launched several startup ventures prior to EnergyFunders, including a legal technology company. Both a savvy entrepreneur and accomplished litigator, Philip fuses legal expertise with astute business know-how to navigate the oil and gas industry’s regulatory waters and carefully pre-vet each project offered through the site.

Philip Racusin

CSO

A seasoned litigation attorney, he has successfully represented clients, ranging from individuals to large companies, in a variety of legal disputes for nearly a decade. He also launched several startup ventures prior to EnergyFunders, including a legal technology company. Both a savvy entrepreneur and accomplished litigator, Philip fuses legal expertise with astute business know-how to navigate the oil and gas industry’s regulatory waters and carefully pre-vet each project offered through the site.

Reed Stiles

VP, Upstream

Prior to joining EnergyFunders, Reed spent 5 years working as a reservoir engineer and team lead at ConocoPhillips in Houston, where he focused on developing and operating their Delaware Basin and Northwest Shelf assets in the Permian Basin. While in graduate school, he found his calling in entrepreneurship and the tech startups. Reed brings a unique mix of upstream technical and operational experience, business knowledge, and passion for new technology. Reed graduated with a B.S. in Petroleum Engineering from The University of Tulsa and also received his MBA from Rice University.

Reed Stiles

VP, Upstream

Prior to joining EnergyFunders, Reed spent 5 years working as a reservoir engineer and team lead at ConocoPhillips in Houston, where he focused on developing and operating their Delaware Basin and Northwest Shelf assets in the Permian Basin. While in graduate school, he found his calling in entrepreneurship and the tech startups. Reed brings a unique mix of upstream technical and operational experience, business knowledge, and passion for new technology. Reed graduated with a B.S. in Petroleum Engineering from The University of Tulsa and also received his MBA from Rice University.

Derrick has founded two successful Oil & Gas companies and has over a decade of experience in both Oil & Gas and technology start-ups. He has taken over our business development responsibilities, the due diligence process, and as a Registered Professional Landman, he advises EnergyFunders on title and working interest partners. He attended the University of Texas at Austin.

Derrick Hale

COO

Derrick has founded two successful Oil & Gas companies and has over a decade of experience in both Oil & Gas and technology start-ups. He has taken over our business development responsibilities, the due diligence process, and as a Registered Professional Landman, he advises EnergyFunders on title and working interest partners. He attended the University of Texas at Austin.

A seasoned leader with the unique ability to bridge the gap between business and technology, Aalok has a proven record of understanding both the macro and micro views of business processes and platform architecture. He has previously worked with several Fortune 100 companies, and led an entire team from startup mode to a mature Software as Service (SaaS) platform generating millions in revenue. His high level of tech background allows him to provide his deep expertise in not only business, but also the intricate technology details needed to navigate his company to success.

Aalok Shah

CTO

A seasoned leader with the unique ability to bridge the gap between business and technology, Aalok has a proven record of understanding both the macro and micro views of business processes and platform architecture. He has previously worked with several Fortune 100 companies, and led an entire team from startup mode to a mature Software as Service (SaaS) platform generating millions in revenue. His high level of tech background allows him to provide his deep expertise in not only business, but also the intricate technology details needed to navigate his company to success.

Q&A with the Founder

  • Please summarize your business and business model.

    EnergyFunders is a financial technology platform for equity and debt-based funding and investments into energy production, operations, and technology projects and companies. We have thousands of users comprised of businesses, accredited investors and non-accredited investors and add several more daily. We have multiple lines of business: a line for accredited investors only, and a line open to all investors--a Registered Funding Portal that is a member of FINRA (Financial Industry Regulatory Authority, Inc.) and SEC-registered. We are just the 37th Registered Funding Portal to achieve FINRA membership.

    Since 2015, we have raised nearly $6MM for upstream oil and gas drilling projects. We make money by aligning our interests with the investors and earning carried interest along the way. This results in a large future upside as well as a cash flowing asset. We believe that no one in our industry is so willing to place the investor first. This has led to years-long loyalty amongst our user base.

    We educate investors on oil and gas and energy investments on our platform. This is one of our core missions.

    Through our EnergyFunders Black oil and gas investment platform, we are currently averaging one raise every six weeks and now approaching a new project raise every 3-4 weeks, with fund reimbursements covering overhead of $8,000 to $10,000. Other fees, such as management and administrative fees also contribute to revenue. Our projects have steadily improved over time to the point where, of projects completed, we are now achieving a success rate since 2017 of 50%. Over time, we believe we can achieve a success rate of 70%.

    Our Registered Funding Portal, EnergyFunders Marketplace, focuses on early stage and later stage raises for innovative energy startups. These companies seek to raise growth capital and issue securities through our Portal. We are initially charging less to build volume, but will soon charge 7% of the funding amount as a fee. We also take equity-based compensation as well. Additionally, we will eventually charge reasonable investor transaction fees of an industry standard 2%, up to $300 per transaction. Revenue from the Portal helps fund the company as our upstream oil and gas projects mature and generate monthly cash flow.

    We have mostly built our technology in-house and we have built a proprietary process to make and allow for micro-investments into oil and gas wells and Regulation CF fundraises. We own all our IP, including the front end and back end of our website. This year, we released our second generation platform in which all transactions are also recorded on a permission-able Ethereum-based Blockchain for security and immutability. Eventually, our blockchain will handle smart contracts which allowing for investors to freely trade, sell and buy stakes in individual oil and gas projects.

    Additionally, we are making the platform capable to be white-labeled to license to companies operating in other verticals. We have substantial interest from multiple white labeling customers to white label our proprietary technology into their verticals in exchange for cross-licensing agreements, licensing fees and revenue splits. We are currently in talks to formalize these deals. These verticals are non-competitive with our core businesses. This allows us to monetize our technology into non-competitive areas and use licensing revenue to accelerate technology development.

    We have nine team members, six of whom devote their full-time efforts to the company, and an operating board that meets every six weeks. We started paying our team members in August of 2017 and the co-founders started to receive compensation in November of 2017. In July 2017, the oil and gas market started to recover from a depression in commodity prices. We built the platform during that depression and we now need the additional capital to scale our revenue. Now is the time for us to scale. Demand for oil and gas and energy, in general, is expected to increase dramatically until 2050 as developing countries' populations enter the middle class. We believe we are poised to be on the vanguard of this macro trend for years to come.

  • Can you talk a bit about your market opportunity and dynamics?

    The oil and gas market can be lucrative and owning working interests can pay big dividends. The energy sector is recovering from a depression, capital for companies and operators is needed, and the opportunities come to us. Energy technology and alternative energy companies from solar ideas to water treatment can now raise up to $1.07M from both accredited and non-accredited investors.

  • What are your competitive advantages and barriers to entry?

    The energy sector has a high barrier to entry due to the complex nature and skills necessary to put a project together. Also, the projects can be unpredictable, so educating investors on making smaller investments over more projects is important and challenging.

  • Who do you view as your closest competitor and what key factors differentiate yourselves?

    Promotion-based oil and gas websites such as Crudefunders or Offerboard would constitute our closest competition in terms of potential oil and gas offerings. However, we are different because we built our technology in-house and we are a fintech platform for all parts of the energy sector. We prioritize customer service and have great rapport with our investors. Our #1 core value is “Investors First.” Finally, these competitors have much less traction as they either little to no history of successfully crowdfunding projects and/or few to no successful projects they can claim. 

  • Please detail any regulatory opportunities and limitations you face.

    One limitation is that we cannot charge up-front fees on our upstream EnergyFunders Black projects which are sold under Reg D 506(b). As for our Registered Funding Portal (EnergyFunders Marketplace), member FINRA and SEC-registered, the Portal is subject to FINRA and the SEC's rules and regulations and applicable law (as codified in the Code of Federal Regulations.)  

  • The Q&A with the Founder is based on due diligence activities conducted by SI Securities, LLC. The verbal and/or written responses transcribed above may have been modified to address grammatical, typographical, or factual errors, or by special request of the company to protect confidential information.

    Term Sheet

    A Side by Side offering refers to a deal that is raising capital under two offering types. If you plan on investing less than US $20,000.00, you will automatically invest under the Regulation CF offering type. If you invest more than US $20,000.00, you must be an accredited investor and invest under the Regulation D offering type.

    Fundraising Description

  • Round type:
    Bridge

  • Round size:
    US $1,070,000

  • Raised to date:
    US $585,363
    US $464,208 (under Reg CF only)

  • Minimum investment:
    US $1,000

  • Target Minimum:
    US $500,000

  • Maximum Raise Amount:
    US $1,070,000
  • Key Terms

  • Security Type:
    Crowd Note

  • Conversion discount:
    20.0%

  • Valuation Cap:
    US $10,000,000

  • Interest rate:
    5.0%

  • Note term:
    24 months
  • Additional Terms

  • Investment Proxy Agreement
    All non-Major Purchasers will be subject to an Investment Proxy Agreement "IPA". The IPA will authorize SeedInvest to act as representative for each non-Major Purchaser and take certain actions for their benefit and on their behalf. Please see a copy of the IPA included with the Company's offering materials for additional details.

  • Closing conditions:
    While EnergyFunders has set an overall target minimum of US $500,000 for the round, EnergyFunders must raise at least US $25,000 of that amount through the Regulation CF portion of their raise before being able to conduct a close on any investments below $20,000. For further information please refer to EnergyFunders's Form C.

  • Transfer restrictions:
    Securities issued through Regulation CF have a one year restriction on transfer from the date of purchase (except to certain qualified parties as specified under Section 4(a)(6) of the Securities Act of 1933), after which they become freely transferable. While securities issued through Regulation D are similarly considered "restricted securities" and investors must hold their securities indefinitely unless they are registered with the SEC and qualified by state authorities, or an exemption from such registration and qualification requirements is available.

  • Use of Proceeds

    Investor Perks

    All investors will receive:

    • A free EnergyFunders Marketplace account along with exclusive access to premium investment opportunities throughout the year.
    • Exclusive invitations to special VIP events held at our corporate office in Houston, and at energy industry conferences and meetups throughout the United States.
    • Access to the Investor Portal with VIP customer service.

    It is advised that you consult a tax professional to fully understand any potential tax implications of receiving investor perks before making an investment.

    Prior Rounds

    The graph below illustrates the valuation cap or the pre-money valuation of EnergyFunders's prior rounds by year.


    This chart does not represent guarantees of future valuation growth and/or declines.

  • Round Size
    US $1,150,000
  • Closed Date
    Jan 31, 2018
  • Security Type
    Preferred Equity
  • Financial Discussion

    Please see the financial information listed on the cover page of this Form C and attached hereto in addition to the following information. Financial statements are attached to the Form C as Exhibit B.

    Operations

    EF Resources, Inc. (a Texas corporation) is an energy-focused crowdfunding company which started with oil and gas. EF Resources Marketplace is a cutting edge Financial technology platform dedicated to disrupting the way people from all over the world invest directly into energy investments. The Company incorporated in 2015 and is based in Houston, Texas. The Company’s consolidated subsidiaries/entities include EnergyFunders, LLC; EF Advisor, LLC; and EF Funding Portal, LLC.

    The Company receives funds from customers that they invest into different entities on behalf of customers. Received deposits are recorded as liability and when the investments occur, the liability is reduced. During the two years ended December 31, 2017 and 2016 the Company had customer deposits of $772,527 and $262,276, respectively. Similarly, in those two years, the Company earned revenues of $125,392 for the year ending 2017 and $113,225 for the year ending 2016. The Company has sustained net losses of $527,831 and $275,742 during the years ended December 31, 2017 and 2016, respectively, and has an accumulated deficit of $937,926

    Liquidity and Capital Resources

    The proceeds from the Offering are essential to our operations. We plan to use the proceeds as set forth above under "Use of Proceeds", which is an indispensable element of our business strategy. The Offering proceeds will have a beneficial effect on our liquidity, as we have approximately $80,000 in cash on hand as of June 15, 2018 which will be augmented by the Offering proceeds and used to execute our business strategy.

    The Company currently does not have any additional outside sources of capital other than the proceeds from the Combined Offerings.

    Capital Expenditures and Other Obligations

    The Company does not intend to make any material capital expenditures in the future.

    Trends and Uncertainties

    After reviewing the above discussion of the steps the Company intends to take, potential Purchasers should consider whether achievement of each step within the estimated time frame is realistic in their judgment. Potential Purchasers should also assess the consequences to the Company of any delays in taking these steps and whether the Company will need additional financing to accomplish them.

    The financial statements are an important part of this Form C and should be reviewed in their entirety. The financial statements of the Company are attached to the Form C as Exhibit B.

    Risks and Disclosures

    Some of the Company's projects are delayed, under-performing, or failed. These projects may cause the Company to miss its growth projections which could damage the Company's financial position. If a significant portion of the Company's projects experience these issues, it may erode investor confidence which could further cause the Company to miss its growth projections.

    The Company may be unable to maintain, promote, and grow its brand through marketing and communications strategies. It may prove difficult for the Company to dramatically increase the number of investors that it serves or to establish itself as a well-known brand in the competitive investments space. Additionally, the product may be in a market where customers will not have brand loyalty.

    We are subject to rapid technological change and dependence on new product development. Our industry is characterized by rapid and significant technological developments, frequent new product introductions and enhancements, continually evolving business expectations and swift changes. To compete effectively in such markets, we must continually improve and enhance its products and services and develop new technologies and services that incorporate technological advances, satisfy increasing customer expectations and compete effectively on the basis of performance and price. Our success will also depend substantially upon our ability to anticipate, and to adapt our products and services to our collaborative partner’s preferences. There can be no assurance that technological developments will not render some of our products and services obsolete, or that we will be able to respond with improved or new products, services, and technology that satisfy evolving customers’ expectations. Failure to acquire, develop or introduce new products, services, and enhancements in a timely manner could have an adverse effect on our business and results of operations. Also, to the extent one or more of our competitors introduces products and services that better address a customer’s needs, our business would be adversely affected.

    The development and commercialization of our products and services are highly competitive. We face competition with respect to any products and services that we may seek to develop or commercialize in the future. Our competitors include major companies worldwide. The crowdfunding market is an emerging industry where new competitors are entering the market frequently. Many of our competitors have significantly greater financial, technical and human resources than we have and superior expertise in research and development and marketing approved services and thus may be better equipped than us to develop and commercialize services. These competitors also compete with us in recruiting and retaining qualified personnel and acquiring technologies. Smaller or early stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. Accordingly, our competitors may commercialize products more rapidly or effectively than we are able to, which would adversely affect our competitive position, the likelihood that our services will achieve initial market acceptance and our ability to generate meaningful additional revenues from our products and services.

    The Company’s success depends on the experience and skill of the board of directors, its executive officers and key workers. In particular, the Company is dependent on Casey Minshew, Derrick Hale, Philip Racusin, Michael Racusin, and Aalok Shah. There can be no assurance that they will continue to be employed by the Company for a particular period of time. The loss of our key employees or any member of the board of directors or executive officer could harm the Company’s business, financial condition, cash flow and results of operations. We do not maintain key-man life insurance with respect to any of our officers or directors. We believe our success is also dependent upon our ability to continue to employ and retain skilled technical personnel.

    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.

    We must acquire or develop new products, evolve existing ones, address any defects or errors, and adapt to technology change. Technical developments, client requirements, programming languages, and industry standards change frequently in our markets. As a result, success in current markets and new markets will depend upon our ability to enhance current products, address any product defects or errors, acquire or develop and introduce new products that meet client needs, keep pace with technology changes, respond to competitive products, and achieve market acceptance. Product development requires substantial investments for research, refinement, and testing. We may not have sufficient resources to make necessary product development investments. We may experience technical or other difficulties that will delay or prevent the successful development, introduction, or implementation of new or enhanced products. We may also experience technical or other difficulties in the integration of acquired technologies into our existing platform and applications. Inability to introduce or implement new or enhanced products in a timely manner could result in loss of market share if competitors are able to provide solutions to meet customer needs before we do, give rise to unanticipated expenses related to further development or modification of acquired technologies as a result of integration issues, and adversely affect future performance.

    The reviewing CPA has included a “going concern” note in the reviewed financials. In particular, the CPA noted that the Company has sustained net losses of $527,831 and $275,742 during the years ended December 31, 2017 and 2016, respectively, and has an accumulated deficit of $937,926. The Company continues to rely on its principal shareholder and other outside investors to finance its operations and anticipates this need for the upcoming year. The Company’s ability to continue as a going concern in the next twelve months following the date the consolidated financial statements were available to be issued is dependent upon its ability to produce revenues and/or obtain financing sufficient to meet current and future obligations and deploy such to produce profitable operating results. Management has evaluated these conditions and plans to generate revenues and raise capital as needed to satisfy its capital needs. No assurance can be given that the Company will be successful in these efforts. The Company’s operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. If the Company does not generate revenues, does not achieve profitability and does not have other sources of financing for our business, it may have to curtail or cease our development plans and operations, which could cause investors to lose the entire amount of their investment.

    We have not prepared any audited financial statements. Therefore, you have no audited financial information regarding the Company’s capitalization or assets or liabilities on which to make your investment decision. If you feel the information provided is insufficient, you should not invest in the Company.

    Cyclical and seasonal fluctuations in the economy and in oil and gas prices in particular may have an effect on our business. Both cyclical and seasonal fluctuations in the economy and in oil and gas prices may affect our business. The oil and gas industry is cyclical, which can result in shortages of drilling rigs, equipment, raw materials, supplies and personnel. When shortages occur, the costs and delivery times of rigs, equipment and supplies increase. In addition, when demand for oil and gas increases, the demand for, and wage rates of, qualified drilling rig crews also rise. Seasonal or cyclical trends may cause fluctuations in our quarterly results; our financial condition and results of operations could suffer.

    We have a history of net losses, may incur substantial net losses in the future and may not achieve profitability. Although we have begun to generate revenues, we have incurred losses since inception. We expect to incur increased costs to implement our business plan and increase revenues, such as costs relating to expanding our crowdfunding platform. If our revenues do not increase to offset these additional expenses or if we experience unexpected increases in operating expenses, we will continue to incur losses and will not become profitable. If we are not able to significantly increase our revenues, we will likely not be able to achieve profitability in the future.

    If we are unable to manage our anticipated growth effectively, our business could be adversely affected. We anticipate that a significant expansion of our operations, and new personnel will be required in all areas of our operations in order to implement our business plan. Our future operating results depend to a large extent on our ability to manage this expansion and growth successfully. For us to manage such growth, we must put in place legal and accounting systems, and implement human resource management and other tools. We have taken preliminary steps to put this structure in place. However, there is no assurance that we will be able to successfully manage this anticipated rapid growth. A failure to manage our growth effectively could materially and adversely affect our ability to market our crowdfunding platform. Our crowdfunding platform operates on an online distribution model and is, therefore, subject to internet cyber risk.

    Our online crowdfunding distribution model could be subject to cyber-attacks aiming to breach our security protocols. We take reasonable and commercial precautions to make our systems as secure as possible, including but not limited to daily back-ups, banking grade hosting solutions, divisions between systems to ensure, for example, that our banking backend cannot be reached via our online distribution network, and continuous monitoring of the systems as well as sequential system checks. However, we cannot fully exclude the possibility of cyber-attacks, third party breaches, software bugs or other forms of internet malfeasance. If any of these events occur, our reputation could be negatively impacted and our future revenues could suffer as a result.

    Increasing competition within our emerging industry could have an impact on our business prospects. The crowdfunding market is an emerging industry where new competitors are entering the market frequently. These competing companies may have significantly greater financial and other resources than we have and may have been developing their products and services longer than we have been developing ours. Although our portfolio of companies and related revenue stream sources are focused on oil and gas drilling or re-working projects, and there are currently only a limited number of competitors providing crowdfunding in the oil and gas industry, increasing competition within the oil and gas and other industries may have a negative impact on our profit margins.

    Our business is subject to risks generally associated with fluctuating economic tendencies in the capital markets. The demand for our products can change over time due to fluctuations in the global and local economies and in the related capital requirements of small and medium-sized enterprises. These fluctuations could negatively impact our future revenue streams.

    We may not be able to adequately protect our proprietary technology, and our competitors may be able to offer similar products and services, which would harm our competitive position. Our success depends in part upon our proprietary technology. We rely primarily on trademark, copyright, service mark and trade secret laws, confidentiality procedures, license agreements and contractual provisions to establish and protect our proprietary rights. Despite these precautions, third parties could copy or otherwise obtain and use our technology without authorization, or develop similar technology independently. We also pursue the registration of our domain names, trademarks, and service marks in the United States. We cannot assure you that the protection of our proprietary rights will be adequate or that our competitors will not independently develop similar technology, duplicate our products and services or design around any intellectual property rights we hold.

    We will likely need additional financing. Any limitation on our ability to obtain such additional financing could have a material adverse effect on our future business, financial condition and results of operations. We will require additional capital to expand our crowdfunding activities and to cover our operating expenses. The raising of additional capital could result in dilution to our shareholders. In addition, there is no assurance that we will be able to obtain additional capital, or that if available, it will be available to us on favorable or reasonable terms. Any limitation on our ability to obtain additional capital as and when needed could have a material adverse effect on our business, financial condition and results of operations.

    Changes in regulations governing our operations, specifically relating to the sale of securities, could negatively affect our business. Changes to the laws and regulations relating to the offering of securities via an online crowdfunding platform would negatively affect our business operations. Such changes could result in our having to change our business model, which could negatively impact future revenues.

    There are significant potential conflicts of interest. Our key personnel may, from time to time, be engaged in activities which could be construed as a conflict of interest. Additionally, our key personnel may own non-Company oil and gas investments, sit on the board of directors of or be involved on a consulting basis to other oil and gas development companies.

    The Company is overdue on its 2017 tax filing, which could subject it to penalties, fines, or interest changes, and which could indicate a failure to maintain adequate financial controls and safeguards. In particular, the Internal Revenue Service (IRS) could impose the Company with costly penalty and interest charges if the Company has filed its tax return late, or has not furnished certain information by the due date. In addition, even if the Company has filed an extension, if it underestimated its taxes, the IRS could penalize it. Potential tax consequences could adversely affect the Company’s results of operations or financial condition.

    The Company does not have an employment contract in place with its key employees. Employment agreements typically provide protections to the Company in the event of the employee’s departure, specifically addressing who is entitled to any intellectual property created or developed by those employees in the course of their employment and covering topics such as non-competition and non-solicitation. As a result, if any of those individuals were to leave EnergyFunders, the Company might not have any ability to prevent their direct competition, or have any legal right to intellectual property created during their employment. There is no guarantee that an employment agreement will be entered into.

    General Risks and Disclosures

    Start-up investing is risky. Investing in startups is very risky, highly speculative, and should not be made by anyone who cannot afford to lose their entire investment. Unlike an investment in a mature business where there is a track record of revenue and income, the success of a startup or early-stage venture often relies on the development of a new product or service that may or may not find a market. Before investing, you should carefully consider the specific risks and disclosures related to both this offering type and the company which can be found in this company profile and the documents in the data room below.

    Your shares are not easily transferable. You should not plan on being able to readily transfer and/or resell your security. Currently there is no market or liquidity for these shares and the company does not have any plans to list these shares on an exchange or other secondary market. At some point the company may choose to do so, but until then you should plan to hold your investment for a significant period of time before a “liquidation event” occurs. A “liquidation event” is when the company either lists their shares on an exchange, is acquired, or goes bankrupt.

    The Company may not pay dividends for the foreseeable future. Unless otherwise specified in the offering documents and subject to state law, you are not entitled to receive any dividends on your interest in the Company. Accordingly, any potential investor who anticipates the need for current dividends or income from an investment should not purchase any of the securities offered on the Site.

    Valuation and capitalization. Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies, especially startups, is difficult to assess and you may risk overpaying for your investment. In addition, there may be additional classes of equity with rights that are superior to the class of equity being sold.

    You may only receive limited disclosure. While the company must disclose certain information, since the company is at an early-stage they may only be able to provide limited information about its business plan and operations because it does not have fully developed operations or a long history. The company may also only obligated to file information periodically regarding its business, including financial statements. A publicly listed company, in contrast, is required to file annual and quarterly reports and promptly disclose certain events — through continuing disclosure that you can use to evaluate the status of your investment.

    Investment in personnel. An early-stage investment is also an investment in the entrepreneur or management of the company. Being able to execute on the business plan is often an important factor in whether the business is viable and successful. You should be aware that a portion of your investment may fund the compensation of the company’s employees, including its management. You should carefully review any disclosure regarding the company’s use of proceeds.

    Possibility of fraud. In light of the relative ease with which early-stage companies can raise funds, it may be the case that certain opportunities turn out to be money-losing fraudulent schemes. As with other investments, there is no guarantee that investments will be immune from fraud.

    Lack of professional guidance. Many successful companies partially attribute their early success to the guidance of professional early-stage investors (e.g., angel investors and venture capital firms). These investors often negotiate for seats on the company’s board of directors and play an important role through their resources, contacts and experience in assisting early-stage companies in executing on their business plans. An early-stage company may not have the benefit of such professional investors.

    EnergyFunders's Form C

    The Form C is a document the company must file with the Securities and Exchange Commission, which includes basic information about the company and its offering and is a condition to making a Reg CF offering available to investors. It is important to note that the SEC does not review the Form C, and therefore is not recommending and/or approving any of the securities being offered.

    Download EnergyFunders's  Form C

    Frequently Asked Questions

    About Side by Side Offerings
    What is Side by Side?

    A Side by Side offering refers to a deal that is raising capital under two offering types. This Side by Side offering is raising under Regulation CF and Rule 506(c) of Regulation D.


    What is a Form C?

    The Form C is a document the company must file with the Securities and Exchange Commission (“SEC”) which includes basic information about the company and its offering and is a condition to making a Reg CF offering available to investors. It is important to note that the SEC does not review the Form C, and therefore is not recommending and/or approving any of the securities being offered.

    Before making any investment decision, it is highly recommended that prospective investors review the Form C filed with the SEC (included in the company's profile) before making any investment decision.


    What is Rule 506(c) under Regulation D?

    Rule 506(c) under Regulation D is a type of offering with no limits on how much a company may raise. The company may generally solicit their offering, but the company must verify each investor’s status as an accredited investor prior to closing and accepting funds. To learn more about Rule 506(c) under Regulation D and other offering types check out our blog and academy.


    What is Reg CF?

    Title III of the JOBS Act outlines Reg CF, a type of offering allowing private companies to raise up to $1 million from all Americans. Prior capital raising options limited private companies to raising money only from accredited investors, historically the wealthiest ~2% of Americans. Like a Kickstarter campaign, Reg CF allows companies to raise funds online from their early adopters and the crowd. However, instead of providing investors a reward such as a t-shirt or a card, investors receive securities, typically equity, in the startups they back. To learn more about Reg CF and other offering types check out our blog and academy.


    Making an Investment in EnergyFunders
    How does investing work?

    When you complete your investment on SeedInvest, your money will be transferred to an escrow account where an independent escrow agent will watch over your investment until it is accepted by EnergyFunders. Once EnergyFunders accepts your investment, and certain regulatory procedures are completed, your money will be transferred from the escrow account to EnergyFunders in exchange for your securities. At that point, you will be a proud owner in EnergyFunders.


    What will I need to complete my investment?

    To make an investment, you will need the following information readily available:

    1. Personal information such as your current address and phone number
    2. Employment and employer information
    3. Net worth and income information
    4. Social Security Number or government-issued identification
    5. ABA bank routing number and checking account number (typically found on a personal check or bank statement)

    If you are investing under Rule 506(c) of Regulation D, your status as an Accredited Investor will also need to be verified and you will be asked to provide documentation supporting your income, net worth, revenue, or net assets or a letter from a qualified advisor such as a Registered Investment Advisor, Registered Broker Dealer, Lawyer, or CPA.


    How much can I invest?

    An investor is limited in the amount that he or she may invest in a Reg CF offering during any 12-month period:

    • If either the annual income or the net worth of the investor is less than $100,000, the investor is limited to the greater of $2,000 or 5% of the lesser of his or her annual income or net worth.
    • If the annual income and net worth of the investor are both greater than $100,000, the investor is limited to 10% of the lesser of his or her annual income or net worth, to a maximum of $100,000.

    Separately, EnergyFunders has set a minimum investment amount of US $1,000.

    Accredited investors investing $20,000 or over do not have investment limits.


    After My Investment
    What is my ongoing relationship with the Issuer?

    You are a partial owner of the company, you do own securities after all! But more importantly, companies which have raised money via Regulation CF must file information with the SEC and post it on their websites on an annual basis. Receiving regular company updates is important to keep shareholders educated and informed about the progress of the company and their investment. This annual report includes information similar to a company’s initial Reg CF filing and key information that a company will want to share with its investors to foster a dynamic and healthy relationship.

    In certain circumstances a company may terminate its ongoing reporting requirement if:

    1. The company becomes a fully-reporting registrant with the SEC
    2. The company has filed at least one annual report, but has no more than 300 shareholders of record
    3. The company has filed at least three annual reports, and has no more than $10 million in assets
    4. The company or another party purchases or repurchases all the securities sold in reliance on Section 4(a)(6)
    5. The company ceases to do business

    However, regardless of whether a company has terminated its ongoing reporting requirement per SEC rules, SeedInvest works with all companies on its platform to ensure that investors are provided quarterly updates. These quarterly reports will include information such as: (i) quarterly net sales, (ii) quarterly change in cash and cash on hand, (iii) material updates on the business, (iv) fundraising updates (any plans for next round, current round status, etc.), and (v) any notable press and news.


    How can I sell my securities in the future?

    Currently there is no market or liquidity for these securities. Right now EnergyFunders does not plan to list these securities on a national exchange or another secondary market. At some point EnergyFunders may choose to do so, but until then you should plan to hold your investment for a significant period of time before a “liquidation event” occurs. A “liquidation event” is when EnergyFunders either lists their securities on an exchange, is acquired, or goes bankrupt.


    How do I keep track of this investment?

    You can return to SeedInvest at any time to view your portfolio of investments and obtain a summary statement. If invested under Regulation CF you may also receive periodic updates from the company about their business, in addition to monthly account statements.


    Other General Questions
    What is this page about?

    This is EnergyFunders's fundraising profile page, where you can find information that may be helpful for you to make an investment decision in their company. The information on this page includes the company overview, team bios, and the risks and disclosures related to this investment opportunity. If the company runs a side by side offering that includes an offering under Regulation CF, you may also find a copy of the EnergyFunders's Form C. The Form C includes important details about EnergyFunders's fundraise that you should review before investing.


    How can I (or the company) cancel my investment under Regulation CF?

    For offerings made under Regulation CF, you may cancel your investment at any time up to 48 hours before a closing occurs or an earlier date set by the company. You will be sent a reminder notification approximately five days before the closing or set date giving you an opportunity to cancel your investment if you had not already done so. Once a closing occurs, and if you have not canceled your investment, you will receive an email notifying you that your securities have been issued. If you have already funded your investment, your funds will be promptly refunded to you upon cancellation. To cancel your investment, you may go to your portfolio page


    What if I change my mind about investing?

    If you invest under any other offering type, you may cancel your investment at any time, for any reason until a closing occurs. You will receive an email when the closing occurs and your securities have been issued. If you have already funded your investment and your funds are in escrow, your funds will be promptly refunded to you upon cancellation. To cancel your investment, please go to your portfolio page.