- $5 million in sales since inception and over $1.6 million in 2018 (unaudited)
- Over 400 flavors authentically homemade and crafted by James Beard nominated chef, Sam Mason
- CPG pints sold at 19 New York City Whole Foods through agreement with Rainforest Distribution
- 4 retail stores in New York City, as well as our own 5,500 square foot OddFactory in Brooklyn
- Premier Brooklyn ice cream brand, consistently recognized as the best Ice Cream in New York City and nationally
- Total Amount Raised: US $137,577
- Total Round Size: US $2,000,000
- Seed :
- Minimum Investment: US $1,000 per investor
- : Preferred Equity
- US $9,000,000 :
- Side by Side Offering
Founded in 2013 from a pregnant woman's food cravings, OddFellows is a premier New York ice cream brand.
Each of our ice creams are authentically homemade and crafted by James Beard nominated Chef, Sam Mason. There is something for kids and adults - sophisticated and playful at the same time. Our ice creams are based on nostalgic, old-timey American classics, as well as some truly innovative, unique combinations with global inspirations. We pride ourselves on taking our customers on a journey; whether it is back to your childhood favorite, or to your recent trip to Asia or Europe.
We operate 4 stores in New York City, each featuring a unique and critically-acclaimed take on our odd and classic ice cream flavors. Our ice cream is also sold on-the-menu in over 20 top-tier restaurants in NY and LA, and in pre-packaged pints through Whole Foods and other grocery stores.
1. Williamsburg, Brooklyn (2013)
The Parlor is our first shop; offering 16 flavors + composed ice cream classics
2. East Village, Manhattan (2016)
The Sandwich Shop - home of the OddPocket and various other ice cream sandwiches
3. Nolita, Manhattan (2018)
Coffee & Cream - Combining a top-tier multi-roaster coffee program with OddFellows signature scoops
4. Dumbo, Brooklyn (2018)
Beer & Wine - Ice Cream Shop with a Happy Hour serving natural wines, craft beers and our delectable ice cream.
Coming Soon (2019)
- Expansion to Bushwick, Brooklyn with the opening of The OddFellows Factory, our 5,500 sq ft production facility, offering tours of behind-the-scenes ice cream production
- Addition of new OddFellows locations
2020 and Beyond
- Further retail expansion outside of NYC
- OddFellows Soda Fountain, that will specialize in cocktails, boozy ice-cream concoctions and savory items from Chef Mason.
Our Ice CreamOddFellows Ice Cream pasteurizes all of our dairy in-house for an exceptionally creamy, flavor forward, delicious base. From there, the flavor combinations know no bounds as James Beard nominated Chef Sam Mason, and his relentlessly-inventive culinary team constantly seek to lead in innovation, both with remixed versions of classics and totally unexpected flavor combinations. The result is an ever-rotating menu of over 400 flavors since our opening in 2013, each with its own unique story, including some of our highlights:
- Peanut Butter & Jelly: One of our first flavors, and like many of our others, it has been copied by other shops. But nobody does it the way we do. We freeze concord grape jelly with liquid nitrogen, shatter it into little bits and then add it into our rich peanut butter base. It’s science and taste all in one.
- Chorizo Caramel Swirl: On our opening menu in Williamsburg along with maple bacon pecan and firmly established ourselves as the “odd” ice cream shop with (gasp!) meat flavors! Chorizo caramel swirl was named one of the Best Ice Creams in NYC by Time Out New York. It might sound strange, but it’s very interesting and delicious. Even if you’re not into meat ice creams, one must appreciate the technique to make a chorizo caramel that is swirled into chorizo ice cream.
- Sprinkles: One of our most popular flavors and it all started as a joke. The day before opening our Williamsburg shop, Sam was looking at our menu which consisted of some pretty odd flavors, and thought– “$#@!, I need something on here kids will love”… And, Sprinkles was born the night before opening day. It’s a crowd favorite among kids of course, but adults love it just as much. It highlights our excellent sweet cream base, but with the added texture and fun of rainbow sprinkles. What’s not to love? Purists and basic folks agree, it’s essentially the perfect ice cream.
In 2019, OddFellows plans to launch top-notch non-dairy vegan ice creams, and alcohol infused ice creams, sorbets, and ice pops that incorporate up to 40% alcohol by volume.
The OddFellows' Scoop Shop Experience
OddFellows centers our philosophy of service on creativity and trust. James Beard nominated Chef Sam Mason and his relentlessly-inventive culinary team constantly seek to lead in innovation, both with remixed versions of classics and totally unexpected flavor combinations. The result is an ever-rotating menu of flavors to please any guest. In turn, the spirit of innovation that drives our kitchen builds brand trust in our guests, and we design our retail shops around an experiential approach to hospitality. Unlike a lot of our competitors, we never say no to samples – and we encourage our guests to be as creative in their selections as we are.
OddFellows' Business Model
OddFellows Holding Company LLC is the parent company for all of OddFellows. Your investment will be into OddFellows Holding Company LLC, which is the 100% owner of all four current retail locations + the Bushwick factory.
We sell our ice creams through 4 sales channels: Retail Shops, CPG, Restaurant Wholesale, and E Commerce. In the future, OddFellows plans to expand into hospitality, with the opening of the OddFellows Soda Fountain (a bar and restaurant concept, which ties in to our brand seamlessly).
As co-founder Mohan Kumar tells it, OddFellows Ice Cream Co. has an origin that’s out of a storybook about your wife’s pregnant (eclectic) food cravings:
"When my wife Holiday was pregnant she had three very specific cravings – (1) fried chicken, (2) coconut water, and (3) savory ice cream. None of the ice cream I was bringing home was doing it for her and I happened to be explaining this to my friend Sam [Mason] one night at his bar. A couple days later, Sam brought over some of his homemade pretzel ice cream, and she loved it. She took down the entire pint in 1 day, which is amazing for someone like her.
At the time I was looking to get out of what I was doing in real estate finance and do something more entrepreneurial, more creative. So, a few days after devouring this pint of Sam’s ice cream, she asked, ‘Why don’t you talk to Sam about opening an ice cream shop?’ I said, ‘That’s a great idea.’ And I approached Sam about that over a beer. His eyes got big and he instantly said he was in. Let’s do this. That was in the winter of 2011. Our twins were born in March 2012, and we opened our first OddFellows Ice Cream Co. in Williamsburg in June of 2013. "
- Seasonal toward summer
- CPG will decrease seasonality as sales of pints in grocery stores do not decline as drastically in the winter months
- Opening stores in other cities, including warmer climates/cities will also help with seasonality and also help drive CPG sales through higher brand recognition. Miami, Boston, Nashville, New Orleans, Houston are potential targets we are considering
- The Company primarily serves retail customers.
- In its restaurant wholesale channel the Company's customers, include: Cha Cha Matcha, Rice & Gold, The SweetShop NYC, Seamores, Massoni
- In its CPG/Pint channel the Company's direct customer is Rainforest as its distributor who sells Company's product primarily to Whole Foods (all NYC locations).
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.
US $137,577 (under Reg CF only)
Securities are also subject to additional transfer restrictions, as specified in the company's Operating Agreement. The Operating Agreement can be found in the "Data Room" below.
The Company and/or its affiliates hold one or more liquor licenses from the New York State Liquor Authority (the “NYSLA”). In order to comply with NYSLA liquor licensing rules, you must warrant and represent to the Company that the following representations are true: (i) you are at least twenty-one (21) years of age; (ii) you are not an active duty police officer; (iii) you are not a person whose license to sell alcoholic beverages has been, has been threatened to be, or is in the process of being, revoked by any governmental authority; (iv) you are not a convicted felon in any jurisdiction; (v) you are either a citizen of the United States of America, a permanent resident alien, or a citizen of a country with a treaty allowing persons to obtain a visa to enter the United States of America to engage in trade; and (vi) you do not have any interest, whether as a proprietor, partner, executive, stockholder, principal, agent, consultant, director, officer, or in any other capacity or manner whatsoever, in any of the following: a wholesale alcoholic beverage company, or an alcohol distributor, producer, importer, or manufacturer. Please see the "Risks & Disclosures" section for further details.
Investors who invest $50,000 or less will have their securities held in trust with a Custodian that will serve as a single shareholder of record. These investors will be subject to the Custodian’s Account Agreement, including the electronic delivery of all required information.
All non-Major Purchasers will be subject to an Investment Proxy Agreement (“IPA”). The IPA will authorize an investment Manager 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 Company's offering materials for additional details.
Time-Based Investor Perks
**Bump Up Card Promo** - Purchase one item at each of OddFellows' 4 locations by March 1st 2019, and receive a bump up to the next tier of perks when you invest.
**First 100 investors that invest by February 22, 2019 will receive a $20 e-gift card!**
- First 50 investors (at any tier) get an OddFellows Insulated To-Go Pint Carrier.
- First five Double Scoop investors get a private all-you-can-eat ice cream party with beer and wine for up to 25 guests at our Williamsburg or Dumbo location
- First five Triple Scoop or above also receive four 4-pint box sets mailed to four of your friends (anywhere in the continental United States)
- First two Root Beer Float or above investors get a private tour of the OddFellows new Bushwick factory and a dinner with the founders (Airfare within USA included for investor)
Regular Investor Perks
- Single Scoop: Investors of $2,500 or more will receive an OddFellows T Shirt and an OddFellows Sweat Shirt
- Double Scoop: Investors of $5,000 or more will receive Single Scoop perks, plus a gift card for $100 that can be used at an OddFellows retail locations
- Triple Scoop: Investors of $20,000 or more will receive Double Scoop perks, plus 10% off OddFellows for life
- Cookies N Cream: Investors of $50,000 or more will receive Triple Scoop perks, plus a ice cream, wine, beer, and cider tasting for two with Andy Mullins, OddFellows Retail Manager and Beverage Director at our Dumbo scoop shop
- Root Beer Float: Investors of $75,000 or more will receive Cookies N Cream perks, plus a one-on-one ice cream making session with our Chief Ice Cream Officer (Sam Mason) in our new Bushwick Factory. Make an ice cream flavor of your choice, from scratch to take home, while collaborating with a James Beard nominated Chef
- Banana Split: Investors of $100,000 or more will receive Root Beer Float perks, plus a private party for up to 25 guests at our Williamsburg or Dumbo location.
- Hot Fudge Sundae Deluxe: Investors of $200,000 or more will receive Root Beer Float perks, plus either (a) a private party for up to 25 guests at our Williamsburg or Dumbo location, or (b) catered ice cream party for up to 100 guests at a location of their choosing in the New York City area.
- Ice Cream Dream: Investors of $500,000 or more will receive a DIAMOND card that entitles you to free ice cream for life (limit up to 1 scoop per day; for your sake and ours).
It is advised that you consult a tax professional to fully understand any potential tax implications of receiving investor perks before making an investment.
The graph below illustrates theor the of OddFellows Ice Cream Co.'s prior rounds by year.
OddFellows Holding Company LLC (a New York Limited Liability Company) is a New York City based ice cream company which operates scoop shops and sells wholesale pints. The Company pasteurizes their own ice cream base—using locally sourced, hormone-free, and additive-free dairy—in their Brooklyn kitchen. While more time consuming, pasteurizing on location allows them to add more nuance and depth to their ice cream flavors. The Company has over 60,000 social media followers, four vibrant retail locations, a new factory debuting soon, and a unique and diversified product offering.
The Company was founded in 2015 and is headquartered in New York City, New York.
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 $166,000 in cash on hand as of December 31, 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 intends to make material capital expenditures as set forth in the “Use of Proceeds”.
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 hereto as Exhibit B.
The global ice cream market has grown steadily from $49bn in 2013 to $59bn in 2018 and projected to reach $75bn in 2024. Ice cream consumers are eating ice cream more impulsively and on-the-go given today's busy life style and in innovative formats (ie, a scoop in coffee, ice cream slices or an OddFellow's OddPocket). Ice Cream eaters are also gravitating towards luxury, premium ice creams. With increasing health consciousness consumers now seek overwhelmingly gratifying, indulgent dessert and/or one that is experiential and uniquely different, like our Rosemary Scented Goat Milk ice cream with Concord Grapes and Walnuts!
OddFellows believes our strategy positions us well as we seek to deliver a superlative taste and hospitality experience whether in our ice cream retail shops, restaurants or pre-packaged pints. Customers and guests know us for our boundless creativity as we constantly develop new and often unorthodox flavors, driven by taste rather than novelty for its own sake. They ask us to tell them a story and show them where they fit in it. Their trust in this experience has enabled us to expand our brand into other aspects of hospitality, particularly those that have a strong connection to ice cream, such as coffee (in OddFellows Nolita) and beer/wine (in OddFellows Dumbo) giving us a competitive advantage over other more traditional ice cream brands.
The Company and/or its affiliates hold one or more liquor licenses from the New York State Liquor Authority (the “NYSLA”). In order to comply with NYSLA liquor licensing rules, you must warrant and represent to the Company that the following representations are true: (i) you are at least twenty-one (21) years of age; (ii) you are not an active duty police officer; (iii) you are not a person whose license to sell alcoholic beverages has been, has been threatened to be, or is in the process of being, revoked by any governmental authority; (iv) you are not a convicted felon in any jurisdiction; (v) you are either a citizen of the United States of America, a permanent resident alien, or a citizen of a country with a treaty allowing persons to obtain a visa to enter the United States of America to engage in trade; and (vi) you do not have any interest, whether as a proprietor, partner, executive, stockholder, principal, agent, consultant, director, officer, or in any other capacity or manner whatsoever, in any of the following: a wholesale alcoholic beverage company, or an alcohol distributor, producer, importer, or manufacturer. As an investor in the company, your name may appear on the NYSLA public database as a co-licensee in connection with the Company’s license, and you may be asked to provide or perform the following to or before the Company and/or the NYSLA in connection with the Company’s license: (i) a completed personal questionnaire; (ii) certain financial documentation including without limitation bank statements; (iii) a two (2) inch by two (2) inch color passport photo of yourself; (iv) a copy of your passport, visa, and/or other proof of citizenship; and (v) a fingerprinting and/or background check. In the event that the NYSLA shall fail to approve the issuance, renewal, or transfer of the license to the Company by reason of your participation as a member in the Company, after the Company has exhausted all reasonable appeals and re-hearing procedures and remedies available to the Company, or the Company in good faith elects in its discretion to abandon its pursuit of the license for the same reason, then you may be automatically removed from the Company without your consent.
The Company forecasts project aggressive growth in revenue from 2018 to 2019. If its assumptions are wrong, and its projections regarding market penetration are too aggressive, its financial projections may overstate its viability. In addition, the forward-looking statements are only predictions. The Company has based these forward- looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
The Company has engaged in Related Party Transactions in addition to a transaction that may raise a conflict of interest. See “THE OFFERING AND THE SECURITIES; Related Person Transactions & Conflicts of Interests” Section of the Form C. The Company has conducted the following transactions with related persons:
- Pursuant to a promissory note dated November 5, 2018, Mr. Kumar (sole managing member of the Company’s Manager) lent $49,999.99 to Oddfellows Dumbo LLC, a subsidiary of the Company, which amount shall be repaid without interest by the earlier of (a) seven days following the borrower’s receipt of certain funds and (b) November 5, 2019. See “CAPITALIZATION AND OWNERSHIP” in the Form C
- In connection with the Chase Loan, Messrs. Kumar and Mason provided personal guarantees and Mr. Kumar provided a mortgage on his condominium unit. See “CAPITALIZATION AND OWNERSHIP” in the Form C.
- Pursuant to the terms of the Operating Agreement, the Company shall pay to the Manager a management fee equal to $200,000.00 per year, subject to increase or decrease in accordance with the terms thereof. The Manager, in turn, pays this fee Messrs. Kumar and Mason as allocated by Mr. Kumar. The fee is currently allocated equally between Messrs. Kumar and Mason.
- Upon the conclusion of this Offering, the Company and/or the Manager intends to retain the services of Jason P. Morris, an existing investor of the Company, as the Company’s Chief Financial Officer or similar role. In consideration of Mr. Morris’s services, Mr. Morris is expected to receive a bonus payment from the Company not to exceed $50,000.00, payable in cash and/or equity of the Company.
The Company’s business model is capital intensive. The amount of capital the Company is attempting to raise in this Offering is not enough to sustain the Company’s current business plan. In order to achieve the Company’s near and long-term goals, the Company will need to procure funds in addition to the amount raised in the Offering. There is no guarantee the Company will be able to raise such funds on acceptable terms or at all. If the Company is not able to raise sufficient capital in the future, it will not be able to execute its business plan, its continued operations will be in jeopardy and it may be forced to cease operations and sell or otherwise transfer all or substantially all of its remaining assets, which could cause a Purchaser to lose all or a portion of his or her investment.
The Company’s expenses will significantly increase as it seeks to execute its current business model. Although the Company estimates that it has enough runway until end of year, the Company will be ramping up cash burn to promote revenue growth, increase payroll, further develop R&D, and fund other Company operations after the raise. Doing so could require significant effort and expense or may not be feasible.
In addition, growth, if any, in our operations will place significant demands on our management, operational and financial infrastructure. If we do not effectively manage their growth, we may fail to timely deliver products to our customers in sufficient volume, and the quality of our products could suffer, which could negatively affect our operating results. To effectively manage this growth, we will need to hire additional persons, and may need to continue to improve our operational, financial and management controls and our reporting systems and procedures. These additional employees, systems enhancements and improvements may require significant capital expenditures and management resources. Failure to implement these improvements could hurt our ability to manage our growth and our financial position.
The Company’s success depends on the experience and skill of its executive officers and the Manager’s key employees. In particular, the Company is dependent on K. Mohan Kumar and Sam Mason. There can be no assurance that Messrs. Kumar and Mason will continue to be employed by the Manager (as defined below) for a particular period of time. The loss of the Manager’s key employees or any executive officer could harm the Company’s business, financial condition, cash flow and results of operations.
A shortage in the supply of key raw materials may increase our costs or adversely affect our sales and revenues. The Company obtains many of our raw materials from third-party suppliers with whom we may not have significant long-term supply contracts. If we experience shortages or delays in obtaining raw materials, these shortages and delays could result in materially higher raw material prices or adversely affect the Company’s ability to manufacture our products. Price increases from a supplier would directly affect the Company’s profitability if it were not able to pass price increases on to our customers. The Company’s inability to obtain adequate supplies of raw materials in a timely manner, or a material increase in the price of raw materials, could have a material adverse effect on our business, financial condition and results of operations.
Our success, in part, will depend on our ability to protect proprietary information. Failure to obtain and protect trademarks, trade names, service marks or trade secrets could adversely affect business. Our business prospects depends in part on management’s ability to develop favorable consumer recognition of the trade names utilized in connection with the sale of our products. Our trademarks and trade names could be imitated in ways that management cannot prevent. Our trademark application described below has been published for opposition but has not yet proceeded to registration, and there is no guarantee it will proceed to registration. In addition, the application with the United States Patent and Trademark Office is currently in the name of the Manager, although the Manager has assigned the application to the Company and both parties are in the process of filing the assignment.
In addition, reliance on trade secrets, proprietary know-how, concepts and recipes warrant methods of protecting this information which may not be adequate, enabling others to independently develop similar know-how or obtain access to our trade secrets, know-how, concepts and recipes. We do not currently have an employee handbook or confidentiality, non-disclosure or work for hire agreements with our employees, which may limit our ability to protect our proprietary information. Moreover, we may face claims of misappropriation or infringement of third parties’ rights that could interfere with our use of their proprietary know-how, concepts, recipes or trade secrets. Defending these claims can be costly and, if unsuccessful, can prevent the Company from continuing to use our proprietary information in the future, and may result in a judgment or monetary damages against us. If competitors independently develop or otherwise obtain access to our know-how, concepts, recipes or trade secrets, our revenue could be reduced and business could be harmed.
Our insurance policies may not provide adequate levels of coverage against all claims. We maintain insurance coverage that is customary for businesses of our size and type. However, there are types of losses that may be incurred by the Company that cannot be insured against or that may not be commercially reasonable to insure. These losses, if they occur, may have a material and adverse effect on our business and results of operations.
We may incur material losses and costs as a result of future product liability claims that may be brought against us. As a producer and marketer of consumer products, we may be subjected to various product liability claims. There can be no assurance that our product liability insurance will be adequate to cover any loss or exposure for product liability, or that such insurance will continue to be available on terms acceptable to management. Any product liability claim not fully covered by insurance, as well as any adverse publicity from a product liability claim or product recall, could have a material adverse effect on our financial condition or results of operations.
We are subject to numerous governmental regulations and failure to comply with those regulations could result in fines or penalties being imposed. Our industry is highly regulated. The manufacturing, labeling and advertising for our products are often regulated by various federal, state and local agencies as well as those of each foreign country, if any, to which we choose to distribute. These governmental authorities may commence regulatory or legal proceedings, which could restrict the permissible scope of our product claims or the ability to manufacture and sell our products in the future.
The Company may not be able to compete successfully in our highly competitive industry. The market for our products and services is large and intensely competitive. Competitive factors include product quality and uniqueness, brand awareness among consumers, access to supermarket and other retail shelf space, price, advertising, promotion, variety in the select market, nutritional content, product packaging and package design.
The ice cream industry is dominated by numerous large companies which have substantially greater financial and other resources than we do and sell brands that are more widely recognized than our products. There are numerous other companies that are our actual or potential competitors, many with greater financial and other resources than our Company (including more employees and more extensive facilities), and offer products or services similar to our products. In addition, many competitors offer a wider range of products or services than that to be offered by the Company. There can be no assurance of our ability to compete successfully.
Our business may be subject to seasonal fluctuations. Historically, our sales are higher in the warmer months of each year. As a result, quarterly and annual operating results and sales may fluctuate significantly as a result of seasonality and the factors discussed above. Accordingly, results for any one fiscal quarter are not necessarily indicative of results to be expected for any other quarter or for any year and comparable sales for any particular future period may decrease. Operating results may also fall below the expectations of management and investors.
We must correctly predict, identify, and interpret changes in consumer preferences and demand, offer new products to meet those changes, and respond to competitive innovation. Consumer preferences for our products change continually. Our success depends on our ability to predict, identify, and interpret the tastes and habits of consumers and to offer products that appeal to consumer preferences. If we do not offer products that appeal to consumers, our sales and market share will decrease. We must distinguish between short-term fads, mid-term trends, and long-term changes in consumer preferences. If we do not accurately predict which shifts in consumer preferences will be long-term, or if we fail to introduce new and improved products to satisfy those preferences, our sales could decline. In addition, because of our varied customer base, we must offer an array of products that satisfy the broad spectrum of consumer preferences. If we fail to expand our product offerings successfully across product categories, or if we do not rapidly develop products in faster growing and more profitable categories, demand for our products could decrease, which could materially and adversely affect our product sales, financial condition, and results of operations.
In addition, achieving growth depends on our successful development, introduction, and marketing of innovative new products and line extensions. Successful innovation depends on our ability to correctly anticipate customer and consumer acceptance, to obtain, protect and maintain necessary intellectual property rights, and to avoid infringing the intellectual property rights of others and failure to do so could compromise our competitive position and adversely impact our business
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 customers that it serves or to establish itself as a well-known brand in the competitive food and beverage space. Additionally, the product may be in a market where customers will not have brand loyalty.
Maintaining, extending and expanding our reputation and brand image are essential to our business success. We seek to maintain, extend, and expand our brand image through marketing investments, including advertising and consumer promotions, and product innovation. Increasing attention on marketing could adversely affect our brand image. It could also lead to stricter regulations and greater scrutiny of marketing practices. Existing or increased legal or regulatory restrictions on our advertising, consumer promotions and marketing, or our response to those restrictions, could limit our efforts to maintain, extend and expand our brands. Moreover, adverse publicity about regulatory or legal action against us could damage our reputation and brand image, undermine our customers’ confidence and reduce long-term demand for our products, even if the regulatory or legal action is unfounded or not material to our operations.
In addition, our success in maintaining, extending, and expanding our brand image depends on our ability to adapt to a rapidly changing media environment. We increasingly rely on social media and online dissemination of advertising campaigns. The growing use of social and digital media increases the speed and extent that information or misinformation and opinions can be shared. Negative posts or comments about us, our brands or our products on social or digital media, whether or not valid, could seriously damage our brands and reputation. If we do not establish, maintain, extend and expand our brand image, then our product sales, financial condition and results of operations could be adversely affected.
The Company will face risks as a retail-based enterprise. The Company currently has four retail locations, two in Manhattan and two in Brooklyn. The Company plans to open additional locations. Risks include as follows:
To successfully expand, we must open new retail locations on schedule, in appropriate locations, and in a profitable manner. We may experience delays in openings in the future or locations chosen may not live up to expectations.
Delays or failures in opening new retail locations could hurt our ability to meet our growth objectives. There is no guarantee that we will be able to achieve our expansion goals or that new locations will be operated profitably. Further, any new locations that are opened may not obtain operating results similar to those of existing locations. The ability to expand successfully will depend on a number of factors, many of which are beyond our control. These factors include:
- locating suitable store sites in new and existing markets;
- obtaining acceptable working capital financing for construction of new stores and negotiating acceptable lease terms;
- recruiting, training and retaining qualified personnel and management;
- cost effective and timely planning, design and build-out of stores;
- obtaining and maintaining required local, state and federal governmental approvals and permits;
- creating customer awareness of new locations;
- competition in the relevant markets; and
- prevailing wage inefficiencies in certain high-wage markets.
The retail-based ice cream industry is intensely competitive with few barriers to entry in which many well-established companies compete on the basis of price, service, product and location.
Potential competitors include a large and diverse group of store chains and individual retail locations that range from independent local operators to well-capitalized national and international companies. Competitors' product and/or service offerings, technologies, marketing expenditures (including expenditures for advertising and endorsements), pricing, costs of production and/or service and customer service are areas of intense competition.
We may not be able to find sufficient new sites to support our planned expansion in future periods.
The success of these new retail locations will be affected by the different competitive conditions, consumer tastes and discretionary spending patterns as well as our ability to generate market awareness of our brand. We may not be successful in operating locations in new markets on a profitable basis. Our success and the success of individual locations depends on our ability to attract, motivate and retain a sufficient number of qualified employees, including managers. The inability to recruit and retain these individuals may delay the planned openings of new stores or result in high employee turnover.
Neighborhood or economic conditions where our current or future establishments are located could decline in the future, thus resulting in potentially reduced sales in these locations. If desirable locations cannot be obtained at reasonable prices, our ability to achieve its growth strategy will be adversely affected.
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.
The Company and certain subsidiaries currently have a $500,000 loan from JPMorgan Chase Bank, NA and a Company subsidiary currently has a $49,999.99 loan from Founder K. Mohan Kumar. The Company intends that a portion of the funds from the Offering would be used to repay the loan from Mr. Kumar, even if the Company only raises the Closing Amount. The Company does not currently intend to use funds from the Offering to repay the loan from Chase (the “Chase Loan”).
Under the terms of the Chase Loan, the Company is required to dedicate a portion of its cash flow from operations, and may be required to dedicate a portion of the Offering proceeds to pay principal of, and interest on, this indebtedness. In addition, the Company cannot make any distributions to members of the Company (except tax distributions) until the indebtedness is repaid in full. The Company and certain of its subsidiaries and the Manager have also furnished guaranties in connection with the Chase Loan, and certain subsidiaries of the Company have granted security interests in certain of their assets, which may have an adverse effect on their, and the Company’s, business should the borrowers be unable to repay the loan.
The Company has not yet formed a Board. The Company is a manager-managed limited liability company. The Manager is owned and controlled by substantial owners of the Company. Although the Company is not required to have a board to conduct operations, boards play a critical role in effective risk oversight. A board helps ensure that management’s actions are consistent with corporate strategy, reflective of the culture of the business, and in line with the organization’s risk tolerance. There is no guarantee that a board will be put in place.
Neither the Company nor the Manager has a written employment contract in place with K. Mohan Kumar, the CEO, or Sam Mason, the CICO. Employment agreements typically provide protections to the Company and the Manager in the event of an employee’s or executive’s departure, specifically addressing who is entitled to any intellectual property created or developed by that person in the course of their involvement with the business. As a result, if Mr. Kumar or Mr. Mason were to leave OddFellows, the Company and the Manager might not have any legal right to intellectual property created during his involvement. There is no guarantee that a written employment agreement will be entered into with Mr. Kumar or Mr. Mason. Mr. Kumar is subject to certain non-compete and non-solicit obligations set forth in the Operating Agreement (as defined below), but these expire on the twelve (12) month anniversary of him ceasing to have the right to act on behalf of the Manager regarding the Company. Although it is the intention of the Company and the Manager to amend and restate the operating agreement of the Manager to incorporate certain terms of Mr. Kumar’s and Mr. Mason’s relationship with the Manager, the loss of either Mr. Kumar or Mr. Mason would have a material adverse effect on the Company. See “THE OFFERING AND THE SECURITIES; Related Person Transactions.”
Existing investors have not waived their pre-emptive rights and currently plan on exercising those rights. The pre-emptive right entitles those investors to participate in this securities issuance on a pro rata basis. If those investors choose to exercise their pre-emptive right, it could dilute shareholders in this round. This dilution could reduce the economic value of the investment, the relative ownership resulting from the investment, or both.
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.
Representatives of SI Securities, LLC are affiliated with SI Advisors, LLC (“SI Advisors”). SI Advisors is an exempt investment advisor that acts as the General Partner of SI Selections Fund I, L.P. (“SI Selections Fund”). SI Selections Fund is an early stage venture capital fund owned by third-party investors. From time to time, SI Selections Fund may invest in offerings made available on the SeedInvest platform, including this offering. Investments made by SI Selections Fund may be counted towards the total funds raised necessary to reach the minimum funding target as disclosed in the applicable offering materials.
Frequently Asked Questions
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.
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.
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.
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.
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 OddFellows Ice Cream Co.. Once OddFellows Ice Cream Co. accepts your investment, and certain regulatory procedures are completed, your money will be transferred from the escrow account to OddFellows Ice Cream Co. in exchange for your securities. At that point, you will be a proud owner in OddFellows Ice Cream Co..
To make an investment, you will need the following information readily available:
- Personal information such as your current address and phone number
- Employment and employer information
- Net worth and income information
- Social Security Number or passport
- 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.
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, OddFellows Ice Cream Co. has set a minimum investment amount of US $1,000.
Accredited investors investing $20,000 or over do not have investment limits.
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:
- The company becomes a fully-reporting registrant with the SEC
- The company has filed at least one annual report, but has no more than 300 shareholders of record
- The company has filed at least three annual reports, and has no more than $10 million in assets
- The company or another party purchases or repurchases all the securities sold in reliance on Section 4(a)(6)
- 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.
Currently there is no market or liquidity for these securities. Right now OddFellows Ice Cream Co. does not plan to list these securities on a national exchange or another secondary market. At some point OddFellows Ice Cream Co. 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 OddFellows Ice Cream Co. either lists their securities on an exchange, is acquired, or goes bankrupt.
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.
This is OddFellows Ice Cream Co.'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 OddFellows Ice Cream Co.'s Form C. The Form C includes important details about OddFellows Ice Cream Co.'s fundraise that you should review before investing.
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
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.