- Founded by Tiki Barber (NY Giants), Mark Gerson (GLG), and Jared Augustine (Seamless/GrubHub)
- $2.67mm in 2018 revenue (first full year of stand-alone business operations) (unaudited)
- Served 200+ corporate customers; including customers from 7 top U.S. banks, 6 top U.S. consulting firms, and 4 top enterprise B2B SaaS companies
- Event series running across 8+ U.S. cities in 2019, including activations at the Super Bowl, NBA ASW, Masters, and NFL Draft
- Gross profits from member events up 700%+ (for 3 mo period March-May against same period in 2018) (unaudited)
- Total Amount Raised: US $180,269
- Total Round Size: US $2,000,000
- Seed :
- Minimum Investment: US $1,000 per investor
- : Preferred Equity
- US $5,000,000 :
- Side by Side Offering
We celebrate renowned athletes and sports moments, showcasing the shared values of sports, life, and business. We give sports fans the opportunity to meet and learn from their sports heroes. Our invitation-only event series provides access to sports icons in premium hospitality settings, designed specifically for business audiences.
Picture an important client or business partner. Think of a favorite sports team or legendary players from that team. Now imagine inviting those clients to an event where they can meet those players and hear their stories firsthand.
Thuzio is a sports events and media company attacking the age old problem of winning time with top clients and prospects. Our solution: a national event series, featuring live sports storytelling from sports icons, in a premium hospitality setting designed for a business audience.
Thuzio provides unique and sophisticated sports content, in a professional and premium environment and in an easy-to-access corporate membership and event format.
We provide custom event series featuring live sports storytelling with professional athletes and sports personalities, designed for a business audience and attended by Thuzio’s corporate membership community. We leverage our preferred network of talent and venues, including: event strategy, content strategy, talent booking, event execution, and logistics.
- When and Where: Thuzio events are designed for convenience, hosted on weekday evenings for 2-3 hrs at private event spaces in and around business centers.
- Content: We feature sports icons in documentary-style interviews with professional members of the sports media. The conversation is focused on the shared values of sports, life, and business, such as leadership, teamwork, and performance.
- Media Assets: Resulting in video, audio, and editorial assets.
- Attendees: Invitation only; ~100-150 attendees.
- Geographies: In 2019, we're targeting 60 events across 10 U.S. cities, including activations at the Super Bowl, NBA ASW, Masters, and NFL Draft.
Benefit for Companies:
- A product that helps you win time with your most important clients
- Unique and premium experience
- Easy to say “yes” - right after work, nearby, low effort
- Cost effective -- all-inclusive and easy to budget
- Easy to administer for teams
Benefit for Brands:
- Sports content with an inspirational, celebratory theme
- Reach an influential and affluent audience of sports fans
- Target by region, sport, and/or leadership theme
Thuzio makes money the same way as professional teams: selling tickets and sponsorship against events and media. Thuzio customers can be broadly defined as the businesses and brands that purchase premium tickets and sponsorship with professional teams. Key industries include: Banking, Consulting, Real Estate, Law, Technology, and Media.
- Members/Tickets: National sales teams and regional businesses purchase a membership with Thuzio, providing access to a bank of tickets.
- Sponsors: B2B and luxury brands leverage Thuzio to reach a targeted audience of affluent sports consumers who are also business decision makers.
- Custom Events are also available on-demand.
Traction to Date
Revenue Growth: Thuzio’s 2018/19 strategy has been to keep member event count (50-60 events) and total revenue ($2.75-3M) consistent while focusing on improving gross margins on both member and custom events.
Growing Margins: Member Event gross margins are at 43% for the period of Jan - May 2019, a ~20 basis point improvement over the same period in the prior year. Custom Event gross margins are at 39% for the period of Jan - May 2019, a ~13 basis point improvement over the same period in the prior year. These margin improvements have been achieved through:
- Increased sponsor branding revenue per event by 105%
- Reduced event expenses per event by 22%
Customers: Thuzio has 200+ active corporate accounts, including customers from 7 top 10 U.S. banks, 6 top U.S. consulting firms, and 4 top U.S. B2B SaaS companies. Approximately 70%+ of 2019 total contract value has come from repeat customers.
"Thuzio creates unique, engaging experiences in a bespoke manner, creating opportunities to entertain High Net Worth clientele." - UBS
"They’ve got a great audience. They’ve got great athletes. Very bespoke events. Really a great match for our brand." - Belvedere
"Thuzio has been an excellent partner of Metlife. They worked with us to find solutions that made sense for our business. The events that they run are first-class and turnkey for their clients." - Metlife
*These companies were not compensated in exchange for their testimonials and their testimonials should not be construed as and/or considered as investment advice.
Thuzio, Inc. was founded in 2012 by Tiki, Mark, and Jared, out of the belief that there was a better way for the public to connect with professional athletes.
We knew from Tiki’s experiences that a properly curated interaction with sports heroes provided an unforgettable moment for participants and a rewarding storytelling opportunity for athletes. Our first business addressing this opportunity was an online database of sports influencers, making them accessible for live appearances and social media activations. Today, this business exists under the brand, “Julius”, a leading influencer marketing software company.
Along the journey, we started hosting events with our business and athlete networks to show the power of these interactions first-hand. The feedback was overwhelmingly positive. We asked the question: what if businesses could buy a version of season tickets to access events with professional athletes all year round? We decided this could be a very special and valuable concept and in 2017 we spun-out the event business as a stand-alone company,"Thuzio". Now, with two years of focus on Thuzio events alone, we're more convinced than ever that Thuzio can become a name known by all who have a passion for sports and business.
We founded Thuzio, Inc. in 2012, aiming to solve a problem recognized by Tiki: it was difficult, if not impossible, for most people to access professional athletes for private appearances. We raised venture funding and built an online database of sports influencers. Over time our customers pushed us to expand the database to include influencers from all genres, and we decided to rebrand the business, as “Julius”, in part to escape the sports connection and be pure to influencers marketing generally. We’re thrilled to say Julius is doing very well and considered a leading influencer marketing software company.
While building Julius, we started hosting events with our business and athlete networks. We thought at worst the events would be a nice marketing program and at best, a new business line. Sure enough, the feedback was overwhelmingly positive, and we felt there was an untapped market for a scalable athlete event business.
In 2016, it became clear we were effectively running two separate businesses: Julius - influencer marketing software, and Thuzio - athlete events, under one roof. The board decided that both businesses deserved to stand-alone with independent management teams.
In 2017, JuliusWorks, Inc. and Thuzio, Inc. were split into two separate corporate entities. None of Julius’ management are involved in Thuzio, or vice versa (although I, Jared, am still on the board of Julius, along with Mark). As such, I’ve now been the full-time CEO building Thuzio events since July 2017.
Our business requires 3 strong networks to perform profitably: 1) athlete and agent relationships, 2) venue relationships, and 3) corporate relationships. We see the athlete network we’ve established over the years, by way of both Thuzio and Julius, as really only matched by the talent agencies and the leagues, and so we see this as a significant gating factor for competition. As such, we believe only agencies/teams/leagues could potentially compete. We believe that we are more likely to be an acquisition target for such an entity than seeing them compete directly, as they have core businesses and customers that require a very different product.
Thuzio competes with other premium sports entertainment products, such as live games, a round of golf, etc. We’re all after the same corporate and sponsor dollars. We believe we win because our events: i) never “lose” so you always feel a sense of happiness and rewards; ii) you get to meet the star athlete; iii) are easy as they held at convenient times and locations for the busy professional (no more trek to the stadium); iv) offer a premium product with food & beverage at a competitive and all-inclusive price; and v) offer a networking environment pre-show so that you have an opportunity to establish meaningful relationships with others in attendance. We think we offer tremendous value relative to a traditional game experience.
We are raising money to help build our vision of a sports events and media business unlike anything else. To do this, we need to resource sales, marketing and content, and build a true media/content competency to enable brands to reach both our live and digital audience, on par with what teams and leagues are able to offer. Post raise, we plan to make 6 hires across these competencies during the remainder of 2019, and ramping marketing spend/output through increased content publishing.
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 $50,269 (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 $50,375 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.
Early-bird-special: Invest by Friday, July 19 at 11:59pm ET to receive the upgrades to each investment tier noted below.
Special Terms for Existing Thuzio Members: We welcome existing Thuzio Members to participate in our SeedInvest investment round. You have 3 choices on how to apply your investor perks:
- Layer your perks into your existing membership plan. (ex. You have 12 tickets remaining in your bank. You invest $2,500 with SeedInvest, and are awarded the perk of 2 bonus tickets. You now have 14 tickets available in your bank.)
- Activate your perks after your existing membership comes to an end. (ex. Your existing ticket bank and membership is good through October 31, 2019. You invest $10K, and are awarded the perk of a Professional Plus 1 membership. You may activate your Professional Plus 1 membership on November 1, 2019 when your existing membership ends.)
- Gift your perks.
- $1,000 - $2,499 EARLY-BIRD ONLY TIER THROUGH JULY 19: 2 tickets
- $2,500 - $4,999: 2 tickets (Early-bird: invest by July 19 and receive 2 bonus tickets for a total of 4 tickets)
- $5,000 - $9,999: 6 tickets(Early-bird: invest by July 19 and receive 2 bonus tickets for a total of 8 tickets)
- $10,000 - $19,999: “Professional Membership - Plus 1” + invitation to attend Investor Summit (Early-bird: invest by July 19 and receive a bonus upgrade to the “Professional Membership - Plus 3”)
- $20,000 - $49,999: “Professional Membership - Plus 1” + access to 1 VIP Experience + invitation to attend Investor Summit + invitation to a group Founder Dinner (Early-bird: invest by July 19 and receive a bonus upgrade to the “Professional Membership - Plus 3”)
- $50,000 - $99,999: “Professional Membership - Plus 3” + opportunity to gift a “Professional Membership - Plus 1” + access to 2 VIP Experiences + invitation to attend Investor Summit + invitation to a private Founder Dinner + 1 Premier Sponsor placement (Early-bird: invest by July 19 and receive a bonus “Professional Membership - Plus 1” to gift)
- $100,000+: “Professional Membership- Plus 3” + opportunity to gift a “Professional Membership - Plus 3” + access to 3 VIP Experiences + invitation to attend Investor Summit + invitation to a private Founder Dinner + 1 Premier Sponsor placement + 1 Title Sponsor placement (Early-bird: invest by July 19 and receive a bonus “Professional Membership - Plus 3” to gift)
Description of Benefits:
All benefits issued to SeedInvest investors are good for from Sept 1, 2019 - Aug 31, 2020.
- Good at all Thuzio Events nationwide, including all Regional and Marquee Events (Marquee Events include Super Bowl, NBA ASW, Masters, and NFL Draft)
- Completely transferable (you personally don’t have to be there)
- May not be changed or canceled once applied for access to a Thuzio event
“Professional Membership - Plus 1” provides:
- Access to all Thuzio events nationwide with up to 1 guest
- Member must be present to gain entry
“Professional Membership - Plus 3” provides:
- Access to all Thuzio events nationwide with up to 3 guests
- Member must be present to gain entry
VIP Experience at Thuzio Events: Access to a private talent meet ‘n greet and/or special autographed item. The VIP Experience is typically only available to Thuzio sponsors for an event. The VIP Experiences issued through this perk program will be applied at mutually agreed upon events, pending availability.
Sponsor Placements: Use a sponsor placement to help your own, or a client/partner business to advertise to the Thuzio audience. Thuzio features 3-5 category exclusive sponsors per event. A sponsor placement is provided by way of this perk program with the opportunity to leverage for your own business or gift to a client/partner business. The placement will be mutually agreed upon with Thuzio, pending existing category commitments and availability.
Premier Sponsorship includes:
- Digital branding on all event collateral
- Event branding and signage
- Custom activation element (such as a product showcase or sponsored segment of event)
- 4 tickets to the event for sponsor guests
Title Sponsorship includes:
- Private VIP Meet ‘n Greet with Talent
- Presenting sponsor of the interview show
- Digital branding on all event collateral
- Event branding and signage
- Opportunity for product showcase
- 10 tickets to the event for sponsor guests
Investor Summit: Annual gathering of Thuzio investors in NYC each Spring, hosted by founders, providing a detailed review of the business, followed by networking cocktails.
Founder Dinner: Private dinner in NYC with the Thuzio founding team: Tiki Barber, Mark Gerson, and Jared Augustine.
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 Thuzio's prior rounds by year.
Thuzio, Inc. (“the Company”) is a Delaware corporation founded in 2012 and headquartered in New York, New York. The Company is a sports media and events company that produces a national event series, featuring live interview shows with athletes and sports influencers, wrapped in a premium and professional hospitality experience, for a professional membership community.
On May 31, 2017, the Company formed a wholly‐owned subsidiary, JuliusWorks, Inc. The Company desired to reorganize the Company’s operations, where the software platform marketed by the Company under the tradename Julius was transferred to JuliusWorks, Inc. under an asset transfer agreement. The Company accounted for the asset transfer under Accounting Standards Codification 505‐60‐25‐2. JuliusWorks, Inc. received other assets and liabilities under the agreement in consideration for the issuance of Series Seed, Series Seed‐1, Series A, Series B and Series B‐1 preferred stock. All shares received by the Company as consideration were distributed on a pro rata basis to the shareholders of the Company. After the transaction, JuliusWorks, Inc. operates as a standalone business that is no longer a wholly‐owned subsidiary of the Company. Operations of JuliusWorks, Inc. are included within the financial statements through May 31, 2017.
Liquidity and Capital Resources
The proceeds from the Combined 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 Combined Offering proceeds will have a beneficial effect on our liquidity, as we have approximately $205,825 in cash on hand as of June 25, 2019, which will be augmented by the Combined Offering proceeds and used to execute our business strategy.
The Company currently does not have any additional outside sources of capital other than the proceeds from the Combined Offerings.
Capital Expenditures and Other Obligations
The Company does not intend to make any material capital expenditures in the future.
The sports industry for North America is valued at $70B and almost $11B is spent annually on premium seating, primarily by business customers. Thuzio is competing for a share of this market.
We compete with the teams, leagues, and other sports properties for sports entertainment and marketing spend. However, we believe that as long as the clients of our members wish to meet the athletes they admire, we have a winning product.
As we continue to scale our physical and digital audience, Thuzio will offer a unique and integrated solution for brands seeking to reach the affluent and influential sports fan. Even at our early stage, we believe we have established strong and difficult to replicate, talent and venue networks, putting any copy-cats at a severe disadvantage.
The CEO is paid a high salary. While the Company believes that the CEO’s salary is reasonable and within market, the Company’s CEO may be paid a salary that is high relative to the stage of the Company’s business, and personnel costs represent a significant portion of the Company’s operating expenses. High executive compensation results in a higher overall salary burn, which in turn shortens the runway for achieving desired traction and company milestones. High executive compensation can leave a negative impression with new or potential investors who may believe that conservatively compensated founder-CEOs are more focused on driving towards the long-term success of the business. It may therefore negatively impact the ability of the Company to raise funds.
The Company’s management holds a below-market ownership stake in the Company given its stage. Management’s equity position may not be large enough to properly incentivize them to grow the Company, increase its value, and achieve the optimal outcome for investors. Management will be further diluted by this offering and its concurrent Regulation D offering.
Accounts payable and receivable are significant cash outlays of the business compared to monthly profits and cash on hand. If the Company fails to meet its obligations, and fails to raise outside capital, it could face liquidity issues. The Company must therefore continue to closely monitor its accounts payables and receivables during every billing cycle, or access further sources of financing in order to allay this risk. Further sources of financing may either dilute investors in this offering or have a senior lien on the Company’s assets, which would be repaid over investors in this offering in the event of a liquidation.
The company was formed out of a recapitalization and spin out of a pre-existing entity, which raised $22m before the spin out. The Company effected the spin out because the two businesses have different business models and financing profiles. The Company’s management and many of its existing investors continue to have interests in the other business.
Revenue growth has been relatively flat over the last 12 – 18 months following the company’s spin out. The company also faced a fall in bookings and overall ticket sales in 2018. As such, the business has shown negative trends in certain metrics in the recent past. During this period, the company has been focusing on improving margins, and has been successful in significantly expanding event gross margins from ~4% in 2017 to 40% in 2019. However, without an increase in topline revenues, the Company may not be able to grow its valuation any further. While the company’s current strategy is to use proceeds from this offering for expansion, there can be no guarantee it will be able to do so.
The Company’s sales cycle is long and may be unpredictable, which can result in variability of its financial performance. Long sales cycles may require the Company to incur high sales and marketing expenses with no assurance that a sale will result, which could adversely affect its profitability. The Company’s results of operations may fluctuate, in part, because of the resource-intensive nature of its sales efforts and the length and variability of the sales cycle.
A sales cycle is the period between initial contact with a prospective customer and any sale of its sports media and events. The sales process involves educating customers about the Company’s sports media and events, participating in extended sports media and events evaluations and configuring the sports media and events to customer-specific needs. The length of the sales cycle, from initial contact with a customer to the execution of a purchase order, is generally 3-12 months. During the sales cycle, the Company may expend significant time and resources on sales and marketing activities or make other expenditures, all of which lower its operating margins, particularly if no sale occurs or if the sale is delayed as a result of extended qualification processes or delays.
Failure to obtain new clients or renew client contracts on favorable terms could adversely affect results of operations. The Company may face pricing pressure in obtaining and retaining their clients. Their clients may be able to seek price reductions from them when they renew a contract, when a contract is extended, or when the client’s business has significant volume changes. On some occasions, pricing pressure results in lower revenue from a client than the Company had anticipated based on their previous agreement with that client. This reduction in revenue could result in an adverse effect on their business and results of operations. Further, failure to renew client contracts on favorable terms could adversely affect the Company’s business.
The Company’s business model is capital intensive. The amount of capital the Company is attempting to raise in this Combined Offering may not be enough to sustain the Company’s current business plan. In order to achieve near and long-term goals, the Company may need to procure funds in addition to the amount raised in the Combined 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, then 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 an investor in this Offering to lose all or a portion of his or her investment.
The Company’s cash position is relatively weak. The Company currently has approximately $205,825 in cash balances as of June 25, 2019. This equates to approximately 3 months of runway. The Company could be harmed if it is unable to meet its cash demands, and the Company may not be able to continue operations if it is not able to raise additional funds.
The Company has outstanding liabilities. The Company has outstanding loans in favor of one of its founders in the aggregate principal amount of $190,000 (excluding interest). One of such loans was made pursuant to a convertible note issued in November 2018, in the principal amount of $100,000. Such note accrues interest at a rate of 5% per annum and has a one-year maturity. Among other things, such note converts automatically into shares of the Company’s preferred equity securities issued and sold in the Company’s next round of financing in which the Company raises gross proceeds in excess of $1,000,000 (excluding the conversion of any indebtedness converted in connection with such financing). Accordingly, if the Company’s raises at least $1,000,000 in the Combined Offering, such note will automatically convert into shares of Series B-2 Preferred Stock at a 20% discount to the price paid by other investors, including you, in the Combined Offering. The conversion of this note, whether in this round, in a future financing or on a change of control of the Company, will dilute your investment.
The Company has generated net losses and negative operating cash flows since its inception as part of the development of its business. The Company has generated net losses and negative cash flows from operating activities since it commenced operations. It has incurred losses of approximately $25,746,793 from its inception through December 31, 2018. Before achieving profitability it will generate continued losses. Its costs may also increase due to such factors as higher than anticipated financing and other costs; non-performance by third-party suppliers, licensees, partners, or subcontractors; and increases in the costs of labor or materials. If any of these or similar factors occur, its net losses and accumulated deficit could increase significantly and the valuation of the Company could decline.
Maintaining, extending, and expanding the Company’s reputation and brand image are essential to the Company’s success. The Company seeks to maintain, extend, and expand their brand image through marketing investments, including advertising and consumer promotions, and product innovation. Increasing attention on marketing could adversely affect the Company’s brand image. It could also lead to stricter regulations and greater scrutiny of marketing practices. Existing or increased legal or regulatory restrictions on the Company’s advertising, consumer promotions and marketing, or their response to those restrictions, could limit their efforts to maintain, extend and expand their brands.
Moreover, adverse publicity about regulatory or legal action against the Company could damage the Company’s reputation and brand image, undermine their customers’ confidence and reduce long-term demand for their products, even if the regulatory or legal action is unfounded or not material to their operations. In addition, the Company’s success in maintaining, extending, and expanding the Company’s brand image depends on their ability to adapt to a rapidly changing media environment. The Company increasingly relies 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 the Company, their brands or their products on social or digital media, whether or not valid, could seriously damage their brand and reputation. If the Company does not establish, maintain, extend and expand their brand image, then their product sales, financial condition and results of operations could be adversely affected.
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 sports media and events space. Additionally, the product may be in a market where customers will not have brand loyalty, which may inhibit the Company’s ability to grow its brand.
Cyclical and seasonal fluctuations in the economy, in sports media and events may have an effect on the Company. Both cyclical and seasonal fluctuations in sports media and events may affect their business. These seasonal trends may cause fluctuations in quarterly results, including fluctuations in revenues.
Not all of the founders or key employees are currently working full time for the Company. One of the Company’s founders, owns and has funded a significant portion of the business, but does not work full time for the Company or manage the day-to-day operations of the business.
The Company’s existing Series B Preferred Stock holders, who invested approximately $450,000 in a prior financing, have a 1x redemption right. Shares of Series B Preferred Stock are redeemable at the election of holders of a majority of the Series B Preferred Stock at any time on or after December 31, 2021, at the original issue price of the Series B Preferred Stock. Such redemption, if elected, would be paid in cash. If the redemption price is not paid in full within 60 days of the redemption request, interest shall accrue on the outstanding amount at a rate of 8% per annum, subject to increase by 4% per annum every 6 months until the entire redemption price has been paid in. As an investor in Series B-2 Preferred Stock, you will not have a redemption right. As such, other investors in the Company will have greater opportunities for liquidity and may have the ability to exit before you. If the Company’s Series B Preferred Stockholders elect to exercise their redemption right, it may significantly impact the Company’s cash balance and assets.
The value of your investment may be diluted if the Company issues additional options. A pool of unallocated options is typically reserved for future employees, which affects the fully-diluted pre-money valuation for this offering. The price per share of the Series B-2 Preferred Stock has been calculated assuming a 1.74 post-money unallocated option pool, which may not account for all additional options the Company will issue after the offering and may not provide adequate protection against the dilution investors may face due to such additional issuances. Any option issuances by the Company over the 1.74% pool will lower the value of your shares.
The Total Amount Raised, as reflected on the SeedInvest platform, is partially comprised of a cancellation of debt from the Company's founder. Specifically, the Total Amount Raised includes $90,000 in the form of cancellation of debt from Mark Gerson, a co-founder of the Company. The loan was originally made in March 2019 for the purposes of providing working capital for the Company, and when made was not formally papered to any specific terms. Such investment does not reflect new cash available for the Company's operations. See balance sheet as provided in the Company's Data Room during the Offering for current cash balance.
The Company is overdue on its 2018 tax filing, which could subject it to penalties, fines, or interest changes, and which could indicate a failure to maintain adequate financial controls and safeguards. In particular, the Internal Revenue Service (IRS) could impose the Company with costly penalties and interest charges if the Company has filed its tax return late, or has not furnished certain information by the due date. In addition, even though the Company states that it has filed an extension, if it underestimated its taxes, the IRS could penalize it. Potential tax consequences could adversely affect the Company.
The Company has conducted related party transactions. During the years ended December 31, 2018 and 2017, the Chief Executive Officer of the Company paid for certain expenses of the Company in the normal course of business from his own resources that are reimbursed to him by the Company. Amounts to be reimbursed to him totaled $16,887 and $9,592 at December 31, 2018 and 2017, respectively. The amounts are recorded within the heading ‘Accounts payable and accrued expenses’ on the balance sheet. During 2018, the Company borrowed $60,000 from the Chief Executive Officer of the Company in the form of a promissory note. The note matures 6‐months from the date of the note and bears interest at 9% per annum. The Company also borrowed $100,000 from a shareholder that matures 12‐months from the date of the note and bears interest at 5% per annum. Both amounts are recorded under ‘Notes payable – related party’ on the balance sheets. Subsequent to December 31, 2018, the Chief Executive Officer loaned the Company $52,300, the provisions of which are still being negotiated and have yet to be finalized. Also subsequent to December 31, 2018, the Company borrowed $90,000 from a shareholder that is expected to be converted to preferred stock in the next investment round. The Company leases office space from the JuliusWorks, Inc. on a month‐to‐month basis at a rate of $5,000 per month.
The reviewing CPA has included a “going concern” note in the reviewed financials. The Company has incurred losses from inception of $25,746,793 and relies on third party financing to fund operations which, among other factors, raises substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon management's plans to raise additional capital from the issuance of debt or the sale of stock, its ability to commence profitable revenue sources resulting from its video and audio content, and its ability to generate positive operational cash flow. The accompanying financial statements do not include any adjustments that might be required should the Company be unable to continue as a going concern.
The Company’s financial statements have not been audited. Therefore, you have no audited financial information regarding the Company’s capitalization, assets or liabilities, or other financial information on which to make your investment decision. If you feel the information provided is insufficient, you should not invest in the Company.
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") 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 Thuzio. Once Thuzio accepts your investment, and certain regulatory procedures are completed, your money will be transferred from the escrow account to Thuzio in exchange for your securities. At that point, you will be a proud owner in Thuzio.
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, Thuzio 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 Thuzio does not plan to list these securities on a national exchange or another secondary market. At some point Thuzio 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 Thuzio 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 Thuzio'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 Thuzio's Form C. The Form C includes important details about Thuzio'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 account's portfolio page by clicking your profile icon in the top right corner.
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 account's portfolio page by clicking your profile icon in the top right corner.