- Purchase orders from Bed Bath & Beyond, Total Wine, The Grommet, Von Maur, Goody Goody, World Market, TJX Home Goods, DFE Ireland, HEB, etc.
- $937,708 in sales in 2017, grew 200% from 2016
- Five U.S. & international patents, including one on NanoPore™ filtration technology, which targets histamines and sulfites in wine
- Founder has 25 years of experience as a health and medical products executive (Novartis, Alcon, Allergan), holds dozens of global patents
- Total Amount Raised: US $160,000
- Total Round Size: US $1,500,000
- Bridge :
- Minimum Investment: US $1,000 per investor
- : Crowd Note
- US $17,000,000 :
- Side by Side Offering
The Mission & Vision
Wine Intolerance is a big problem hiding in plain sight! We estimate that 36 million U.S. adults 21+ (43% of the wine drinking population*) suffer moderate to frequent side effects from drinking wine.
The mission of PureWine is to end the problem of wine intolerance and enable more people to enjoy the unique pleasures and health benefits of wine.
The most common side effects from drinking wine are a function of an individual’s genetics, age, and lifestyle.
The cause of some immediate side effects may not be the alcohol, but rather the histamines and the sulfites that are in all red, white, rosé, and sparkling wines.
PureWine products work by removing the four kinds of histamines and the two kinds of sulfites which trigger some of the common side effects from drinking wine. Importantly, PureWine products work without significantly changing the taste, aromas, or color of wine**.
*43% incidence of wine intolerance is an estimate based on a third-party survey sponsored by PureWine targeting wine-drinking American women between the ages of 30-60 with income over $75,000.
**Study conducted in 2015 by Florida International University, School of Hospitality and sponsored by PureWine. The Wand was tested by trained and untrained sensory panelists. No significant taste differences were detected between treated and untreated samples of selected Cabernet Sauvignon wines. The paper has not yet been published.
PureWine currently markets two products, one for the glass and one for the bottle:
The Wand™ filters a single glass of wine. The Wand™ is available in 5-, 10-, 30-, and 90-unit packages. The average retail cost of an individual Wand that filters a 6 oz. glass of wine is $2.00.
The Wave™ filters and aerates an entire bottle of wine as you pour. The Wave™ is available in 1- and 3-unit packages. The retail cost of a single Wave™, that filters a 750ml bottle of wine is $9.99.
The scientific breakthrough that led to the founding of PureWine in 2016 was discovering how to selectively filter the four types of biogenic amines (including histamine, putrescine, cadaverine, and tyramine) and the two types of sulfites (free and total sulfites) that cause wine headaches and side effects (both histamines and sulfites are naturally occurring in wine -- and sulfites are also added to prevent oxidation in the bottle.)
Importantly, both The Wand™ and The Wave™ filter histamines and sulfites without adding anything to the wine. In blind tests, many people prefer the taste of wine filtered by PureWine. We believe that’s because it maintains the natural characteristics inherent in each varietal and blend.
The PureWine patent portfolio provides a competitive advantage to the company. PureWine holds five global patents on its core technologies and has another five patents pending.
In 2019, PureWine plans to launch its third product, a disposable cartridge filter ($4.00) that fits into a permanent aerator ($40). This represents a “razor and blades” business model that we believe will ultimately become the lead offer, providing a superior price/value and driving higher turn and increased retention.
PureWine technology has significant potential for extended application across fermented beverages, including beer, ale, and spirits. Our future plans include developing unique products tailored to these different beverage types.
We are also planning to license our technologies to high-volume wine producers, so they can filter the histamines and reduce the amount of sulfites just prior to bottling.
Based on the rapid growth of the digital health market and the growing consumer desire among consumers to reduce additives and preservatives in their diets, PureWine stands to reap the benefits of these transformational consumer behaviors.
PureWine Inc. was founded in 2014 by a father and son team, David Meadows, Ph.D and his son Derek.
Both father and son suffered from red wine headaches and experienced other side effects such as congestion and skin flush from both red and white wine.
But, like true scientists, they didn’t suffer in silence -- they set out to understand the problem and to solve it.
Together, David and Derek spent three years in the laboratory looking for a solution to their own experiences. The Eureka moment, came one day in the lab when David and Derek found the precise “mechanism of action” to selectively remove histamines and sulfites without otherwise significantly changing the chemistry of wine.
“We could see that our filtration was working, but when we tried that big, bold Cab and it tasted just like it does in the tasting room in Napa, we knew we had it,” says David.
In 2016, the duo launched the first PureWine product, The Wand™, for a glass of wine, followed in mid-2018 by The Wave™ for a bottle of wine.
Our team members are all wine lovers and we are passionately committed to helping more people enjoy the unique pleasure of wine.
Are all founders currently full-time? If not, please explain who, why, and what the expected timeline is for part-time founders to join full-time.
David Meadows is the only founder who is currently full-time. Derek Meadows will become full-time over the next 6 months. John Meadows will remain part-time.
Derek Meadows is currently paid $3000/month. Post-raise he will be paid $4000/month.
John Meadows is currently paid $1000/month and it will not change post-raise.
We currently have 5 granted patents: 1 US utility patent; 2 US design patents; 1 European design patent; 1 Chinese design patent.
The PureWine business today is protected by its patent portfolio, its strong retail presence, and its robust e-commerce presence both on Amazon (#1 wine pour product) and our own drinkpurewine.com channel. PureWine products also meet the regulatory requirements of the FDA for Food Contact Products which will serve as an effective barrier against low quality, non-registered product knockoffs.
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 $10,000 (under Reg CF only)
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.
Investors who invest $100,000 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.
Investors of $1,000 - $2,999 will receive a free month’s supply of The Wand™ (30-pack) and The Wave™ (5-pack).
Investors of $3,000 - $14,999 will receive a special gift package of The Wand™ and The Wave™ that will filter 500 glasses--or 50 bottles--of wine.
Investors of $15,000 - $24,999 will receive a set of 12 Riedel Sommelier Bordeaux Grand Cru wine glasses.
Investors of $25,000 - $74,999 will receive a Special Wine Lover’s Cellar--a One Year Supply of The Wand™ and The Wave™--shipped in quarterly installments; each installment can be for persoanl use or shipped as a special gift package.
Bronze investors will also be invited to PureWine Wine Tasting Events, led by certified French sommeliers, in one of three cities: New York, San Francisco, or Dallas.
Investors of $75,000 - $149,999 will be invited to become part of the PureWine Product Advisory Board and meet with the company two times a year to develop the next innovations for PureWine filtration technology with wine, beer/ale, and spirits.
The Advisory Board role also include airfare to attend “The Future of Wine” meeting in 2019 in Sonoma, CA at a major winery.
Investors of $150,000 or more will receive paid airfare and accommodations to participate in a three-day Napa Wine Experience in at a resort, with private cellar tours by the winemaker, as well as lunch and dinner with the PureWine leadership and Board of Directors.
It is advised that you consult a tax professional to fully understand any potential tax implications of receiving investor perks before making an investment.
PureWine, Inc. (“the Company”) is a corporation organized under the laws of Delaware & Texas. The Company is a manufacturer of beverage filtration devices.
The financial statements have been prepared on the going concern basis, which assumes that the Company will continue in operation for the foreseeable future. However, management has identified the following conditions and events that created an uncertainty about the ability of the Company to continue as a going concern. The Company generated revenue for 2016 & 2017. However, net losses were incurred for both years.
The Reviewed Financial Report describes management's plans that are intended to mitigate the conditions and events that raise substantial doubt about the Company's ability to continue as a going concern. The company plans to raise $1.5M. A portion of the additional funds will be used to create an adequate reserve in the event of a shortfall in revenue. Additionally, expenses will be carefully monitored and if revenue gaps begin to occur, discretionary marketing & sales expenses will be curtailed. If revenue shortfalls persist, personnel expenses will then be curtailed through headcount reductions. The Company's ability to meet its obligations as they become due is dependent upon the success of management's plans, as described above.
These conditions and events create an uncertainty about the ability of the Company to continue as a going concern through October 22, 2019 (one year after the date that the financial statements are available to be issued). The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.
In 2016 and 2017, the Company issued various notes payable in exchange for cash for the purpose of funding continuing operations. The notes payable accrue interest at rates of between 6% and 10% per annum and are payable at a future date to be determined by management.
In June of 2018, the Company borrowed funds (“the Note”) from a commercial lender for the purpose of funding product development and marketing efforts. The Note is secured by all otherwise unencumbered assets of the Company and is also personally guaranteed by the Company’s founder.
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 $78,627 in cash on hand as of as of August 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.
The PureWine business sits at the intersection of three high-growth, high-return market spaces: Wine (+6% CAGR), Health/Wellness (+6% CAGR), Clean/Pure Food & Beverage (+13% CAGR)
Annual U.S. purchase of wine in the Off Premises market (for home consumption) totaled $66 billion, or 2.25 billion bottles, in 2017. In the U.S., women buy 8 out of 10 bottles of wine for the home.
By 2022, we expect the Wine Filter Market to be worth $670 million, as awareness of the problem of wine intolerance grows, people understand their own health triggers more and seek personal health solutions.
Current competition to PureWine is small and fragmented. Based on our knowledge, the competitive products only reduce sulfites, not histamines and therefore offer more limited treatment of side effects.
*These market figures represent management’s opinions based on third-party research. This section does not represent guarantees of future results, levels of activity, performance, or achievements.
Risks Related to the Company’s Business and Industry
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 reviewing CPA has included a “going concern” note in the reviewed financials. The financial statements have been prepared on the going concern basis, which assumes that the Company will continue in operation for the foreseeable future. Management has identified the following conditions and events that create an uncertainty about the ability of the Company to continue as a going concern. The Company has generated revenue for 2016 & 2017. However, net losses were incurred for both years. The following describes management's plans that are intended to mitigate the conditions and events that raise substantial doubt about the Company's ability to continue as a going concern. The company plans to raise $1.5M. A portion of the additional funds will be used to create an adequate reserve in the event of a shortfall in revenue. Additionally, expenses will be carefully monitored and if revenue gaps begin to occur, discretionary marketing & sales expenses will be curtailed. If revenue shortfalls persist, personnel expenses will then be curtailed through headcount reductions. The Company's ability to meet its obligations as they become due is dependent upon the success of management's plans, as described above. These conditions and events create an uncertainty about the ability of the Company to continue as a going concern through October 22, 2019 (one year after the date that the financial statements are available to be issued). The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.
The development and commercialization of the Company’s products and services are highly competitive. It faces competition with respect to any products and services that it may seek to develop or commercialize in the future. Its future competitors may include major companies worldwide. The wine accessories market is an emerging industry where new competitors are expected to enter the market. Some of the Company’s competitors may have significantly greater financial, technical and human resources and may have superior expertise in research and development and marketing approved services and thus may be better equipped than the Company to develop and commercialize services. These competitors could also compete with the Company 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, the Company’s competitors may commercialize products more rapidly or effectively than the Company is able to, which would adversely affect its competitive position, the likelihood that its services will achieve initial market acceptance and its ability to generate meaningful additional revenues from its products and services.
The Company forecasts project aggressive growth post-raise. 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 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, the Company 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 relies heavily on their technology and intellectual property, but they may be unable to adequately or cost-effectively protect or enforce their intellectual property rights, thereby weakening their competitive position and increasing operating costs. To protect their rights in our services and technology, they rely on a combination of copyright and trademark laws, patents, trade secrets, confidentiality agreements with employees and third parties, and protective contractual provisions. They also rely on laws pertaining to trademarks and domain names to protect the value of their corporate brands and reputation. Despite their efforts to protect their proprietary rights, unauthorized parties may copy aspects of their services or technology, obtain and use information, marks, or technology that they regard as proprietary, or otherwise violate or infringe their intellectual property rights. In addition, it is possible that others could independently develop substantially equivalent intellectual property. If they do not effectively protect their intellectual property, or if others independently develop substantially equivalent intellectual property, their competitive position could be weakened.
Effectively policing the unauthorized use of their services and technology is time-consuming and costly, and the steps taken by them may not prevent misappropriation of their technology or other proprietary assets. The efforts they have taken to protect our proprietary rights may not be sufficient or effective, and unauthorized parties may copy aspects of their services, use similar marks or domain names, or obtain and use information, marks, or technology that they regard as proprietary. They may have to litigate to enforce their intellectual property rights, to protect their trade secrets, or to determine the validity and scope of others’ proprietary rights, which are sometimes not clear or may change. Litigation can be time consuming and expensive, and the outcome can be difficult to predict.
Manufacturing or design defects, unanticipated use of their products, or inadequate disclosure of risks relating to the use of the products can lead to injury or other adverse events. These events could lead to recalls or safety alerts relating to their products (either voluntary or required by governmental authorities) and could result, in certain cases, in the removal of a product from the market. Any recall could result in significant costs as well as negative publicity that could reduce demand for their products. Personal injuries relating to the use of their products could also result in product liability claims being brought against them. In some circumstances, such adverse events could also cause delays in new product approvals. Similarly, negligence in performing their services could lead to injury or other adverse events.
The Company’s success is dependent on a relatively unproven market. The Company may incur substantial operating costs, particularly in sales and marketing and research and development, in attempting to develop these markets. If the market for the Company’s products develops more slowly than expected, its growth may slow or stall, and its operating results would be harmed. The market for the product is still evolving, and the Company depends on continued growth of this market.
Our advertising and marketing materials and disclosures have been and continue to be subject to regulatory scrutiny. Potential consumer protection or product liability lawsuits against us could cause us to incur substantial liabilities and limit commercialization of any products that we may develop.
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 space. Additionally, the product may be in a market where customers will not have brand loyalty.
Cyclical and seasonal fluctuations in the economy may have an effect on their business. Both cyclical and seasonal fluctuations in internet usage and traditional retail seasonality may affect the business. These seasonal trends may cause fluctuations in quarterly results, including fluctuations in revenues.
The Company has a high valuation cap based on its time in the market to date. Since the Company is relatively new to the untested marketplace, Investors may not be adequately compensated for the risk they are taking on when investing in the Company.
The Company has conducted the following transactions with related persons. Please see page 19 of the Offering Memorandum for details.
The Company has outstanding debt, which includes a lien on all assets and all IP. Please see page 14 of the Offering Memorandum for details.
Risks Related to the Securities
The Crowd Notes will not be freely tradable until one year from the initial purchase date. Although the Crowd Notes may be tradable under federal securities law, state securities regulations may apply and each Purchaser should consult with his or her attorney. You should be aware of the long-term nature of this investment. There is not now and likely will not be a public market for the Crowd Notes. Because the Crowd Notes have not been registered under the 1933 Act or under the securities laws of any state or non-United States jurisdiction, the Crowd Notes have transfer restrictions under Rule 501 of Regulation CF. It is not currently contemplated that registration under the 1933 Act or other securities laws will be affected. Limitations on the transfer of the Crowd Notes may also adversely affect the price that you might be able to obtain for the Crowd Notes in a private sale. Purchasers should be aware of the long-term nature of their investment in the Company. Each Purchaser in this Offering will be required to represent that it is purchasing the Securities for its own account, for investment purposes and not with a view to resale or distribution thereof.
We are selling convertible notes that will convert into shares or result in payment in limited circumstances. These notes only convert or result in payment in limited circumstances. If the Crowd Notes reach their maturity date, investors (by a decision of the Crowd Note holders holding a majority of the principal amount of the outstanding Crowd Notes) will either (a) receive payment equal to the total of their purchase price plus outstanding accrued interest, or (b) convert the Crowd Notes into shares of the Company’s most senior class of preferred stock, and if no preferred stock has been issued, then shares of Company’s common stock. If there is a merger, buyout or other corporate transaction that occurs before a qualified equity financing, investors will receive a payment of the greater of their purchase price plus unpaid accrued interest or the number of preferred shares they would have been able to purchase using the valuation cap. If there is a qualified equity financing (an initial public offering registered under the 1933 Act or a financing using preferred shares), the notes will convert into a yet to-be-determined class of preferred stock. If the notes convert because they have reached their maturity date, the notes will convert based on a $17,000,000 valuation cap. If the notes convert due to a qualified equity financing, the notes will convert at a discount of 20%, or based on a $17,000,000 valuation cap. This means that investors would be rewarded for taking on early risk compared to later investors. Outside investors at the time of conversion, if any, might value the Company at an amount below the $17,000,000 valuation cap, so you should not view the $17,000,000 as being an indication of the Company’s value.
We have not assessed the tax implications of using the Crowd Note. The Crowd Note is a type of debt security. As such, there has been inconsistent treatment under state and federal tax law as to whether securities like the Crowd Note can be considered a debt of the Company, or the issuance of equity. Investors should consult their tax advisers.
The Crowd Note contains dispute resolution provisions which limit your ability to bring class-action lawsuits or seek remedy on a class basis. By purchasing a Crowd Note through this Offering, you agree to be bound by the dispute resolution provisions found in Section 8 of the Crowd Note. Those provisions apply to claims regarding this Offering, the Crowd Notes and possibly the securities into which the Crowd Note are convertible. Under those provisions, disputes under the Crowd Note will be resolved in arbitration conducted in Delaware. Further, those provisions may limit your ability to bring class action lawsuits or similarly seek remedy on a class basis.
You may have limited rights. The Company has not yet authorized preferred stock, and there is no way to know what voting rights those securities will have. In addition, as an investor in the Regulation CF offering you will be considered a Non-Major Investor (as defined below) under the terms of the notes offered, and therefore, you have more limited information rights.
You will be bound by an investor proxy agreement which limits your voting rights. As a result of purchasing the notes, all Non-Major Investors (including all investors investing under Regulation CF) will be bound by an investor proxy agreement. This agreement will limit your voting rights and at a later time may require you to convert your future preferred shares into common shares without your consent. Non-Major Investors will be bound by this agreement, unless Non-Major Investors holding a majority of the principal amount outstanding of the Crowd Notes (or majority of the shares of the preferred equity the notes will convert into) held by Non-Major Investors vote to terminate the agreement.
A majority of the Company is owned by a small number of owners. Prior to the Offering, the Company’s current owners of 20% or more of the Company’s outstanding voting securities beneficially own up to 52.66% of the Company’s voting securities. Subject to any fiduciary duties owed to our other owners or investors under Delaware law, these owners may be able to exercise significant influence over matters requiring owner approval, including the election of directors or managers and approval of significant Company transactions, and will have significant control over the Company’s management and policies. Some of these persons may have interests that are different from yours. For example, these owners may support proposals and actions with which you may disagree. The concentration of ownership could delay or prevent a change in control of the Company or otherwise discourage a potential acquirer from attempting to obtain control of the Company, which in turn could reduce the price potential investors are willing to pay for the Company. In addition, these owners could use their voting influence to maintain the Company’s existing management, delay or prevent changes in control of the Company, or support or reject other management and board proposals that are subject to owner approval.
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 PureWine. Once PureWine accepts your investment, and certain regulatory procedures are completed, your money will be transferred from the escrow account to PureWine in exchange for your securities. At that point, you will be a proud owner in PureWine.
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, PureWine 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 PureWine does not plan to list these securities on a national exchange or another secondary market. At some point PureWine 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 PureWine 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 PureWine'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 PureWine's Form C. The Form C includes important details about PureWine'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.