- Over 100K units shipped in its first year and in 100+ retail stores in California since launch in April 2020
- Executed a multi-state 5 year deal to launch a co-branded SKU with Mike Tyson's brand Tyson 2.0, expected to launch in Q1 2021
- Signed agreements to expand into Canada and Massachusetts before the end of the year
- Won multiple awards including best sublingual awards, best edible award and a Clio design award (annual award program that recognizes innovation and creative excellence in advertising, design, and communication)
- Total Amount Raised: US $821,904
- Total Round Size: US $5,000,000
- Seed :
- Minimum Investment: US $1,000 per investor
- : Preferred Equity
- US $20,000,000 :
- Side by Side Offering
VB Brands/CLICK Spray solves one of the cannabis industry's biggest growth problems--margin compression. Although many are trying vertical integration to tackle the problem, CLICK provides an alternative, more sustainable solution which we believe can produce gross margin's exceeding 40% (see data room for assumptions).
VB Brands, at its core with CLICK, is a branding and marketing company of high-tech patent pending products and packaging that is licensed to legally authorized and selected cannabis manufacturers/distributors to make the final finished product that is sold at retail stores or through Direct-To-Consumer (DTC) delivery services. VB Brands makes its revenue based on the sale of hardware and packaging that includes the licensing fee to sell a product bearing VB Brands’ CLICK brand.
Additionally, the use of Nano-emulsion technology is unique to CLICK’s patent pending bottles. Other products in the market use generic “mace bottles” that were designed to spray a “focused” stream of liquid to thwart off an attacker. This results in a very aggressive and off-putting spray experience into the mouth; additionally, other companies use of oil based distillate leaves a sticky oily feeling in the back of your throat. We believe the CLICK experience is exceptional. When you spray CLICK, it generates a pleasing “puffy cloud” of fine mist that sprays lightly and evenly in your mouth, providing a premium experience, flavor and aftertaste.
With over 100k units sold in the first year of operations, already an award winning product, CLICK Spray is now in 100+ retailers throughout California and has plans for near term expansion in Massachusetts and Canada. Beyond NBA player-investors, CLICK Spray has entered into an exciting celebrity 5 year collaboration with Mike Tyson, former boxing world champ, and his Mike Tyson 2.0 cannabis company.
A Side by Side offering refers to a deal that is raising capital under two offering types. Investments made through the SeedInvest platform are offered via Regulation CF and subject to investment limitations further described in the Form C and/or subscription documents. Investments made outside of the SeedInvest platform are offered via Regulation D and requires one to be a verified accredited investor in order to be eligible to invest.
US $202,199 (under Reg CF only)
Investors who invest less than $50,000 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.
Tier 1 - $2,500 to $4,999 - You will receive one entry into a lottery to win a roundtrip airfare, two night hotel stay, dinner at a 5 star restaurant with the CLICK team and tickets to an LA sporting event or concert. Additionally you will receive 4 CLICK Wellness sprays, or if you live in the state of California, a 50% off discount code for CLICK sprays and gummies.
Tier 2 - $5,000 to $49,999 - Perks included in Tier 1 plus custom CLICK sweatshirt and hat, as well as a one on one call with CLICK's founder Roie Edery.
Tier 3 - $50,000- $99,999 - Perks included in Tier 2 plus five entries into a lottery to win a roundtrip airfare, two night hotel stay, dinner at a 5 star restaurant with the CLICK team, and tickets to an LA sporting event or concert.
Tier 4 - $100,000 to $499,999 - Perks included in Tier 3 plus signed NBA swag and a Zoom call with retired NBA champion Omri Casspi.
Tier 5 - $500K+ - All perks included in Tier 4 plus an all expenses paid trip to a NBA game for two, including the opportunity to meet with recently retired NBA champion, Omri Casspi.
Bonus Perk: For those who invest by March 18, 2022, you will receive an additional entry into a lottery to win a roundtrip airfare, two night hotel stay, dinner at a 5 star restaurant with the CLICK team, and tickets to an LA sporting event or concert.
It is advised that you consult a tax professional to fully understand any potential tax implications of receiving investor perks before making an investment.
Please note that due to share price calculations, some final investment amounts may be rounded down to the nearest whole share - these will still qualify for the designated perk tier. Additionally, investors must complete the online process and receive an initial email confirmation by the deadline stated above in order to be eligible for perks.
The fast growing cannabis industry is expanding rapidly, at an accelerated rate, with a 23% CAGR. From 2018 to 2021, the industry has gone from $9.1B to $19.7B, predominantly driven by rapid growth and expansion in the US.
Specifically, in the Extracted Cannabis (Tincture and Sublingual) subcategory, there is a 33% CAGR. Where traditional cannabis flower/roll product growth rate is slowing, product categories that are ripe for high tech innovation have grown significantly. CLICK aims to be the leading sublingual mouth spray across California and has won numerous and prestigious awards and recognition. With CLICK's expansion plans into Massachusetts and Canada, and recent collaboration with Mike Tyson 2.0, we believe the company is poised to help lead the tremendous growth in this subcategory and beyond.
CLICK's platform solves one of the cannabis industry's biggest growth challenges - margin compression. Vertical Integration being pursued by many players may not be the answer. Rather, higher gross margins supported by a better user experience may offer a more sustainable solution. By focusing our efforts on high margin, low overhead segments of the supply chain, CLICK is able to do what we do best. For everything else, we partner with best of breed industry experts. This approach will allow us to create new products and new brands quickly, efficiently and without the high costs that a vertically integrated company would incur.
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 competitors include major companies worldwide. The cannabis technology market is an emerging industry where new competitors are entering the market frequently. Many of the Company’s competitors 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 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’s expenses will significantly increase as they seek to execute their current business model. Although the Company estimates that it has enough runway for [5-6] months, they will be ramping up cash burn to promote revenue growth, 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.
Not all of the founders or key employees are currently working full time for the Company. As a result, certain of the Company's employees, officers, directors or consultants may not devote all of their time to the business, and may from time to time serve as employees, officers, directors, and consultants of other companies. These other companies may have interests in conflict with the Company.
The Company projects aggressive growth in 2022. If these assumptions are wrong and the projections regarding market penetration are too aggressive, then the financial forecast may overstate the Company's overall 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 outbreak of the novel coronavirus, COVID-19, has adversely impacted global commercial activity and contributed to significant declines and volatility in financial markets. The coronavirus pandemic and government responses are creating disruption in global supply chains and adversely impacting many industries. The outbreak could have a continued material adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate material adverse impact of the novel coronavirus. Nevertheless, the novel coronavirus presents material uncertainty and risk with respect to the Funds, their performance, and their financial results.
The Company's ability to grow the business depends on state laws pertaining to the cannabis industry. Continued development of the medical-use cannabis industry depends upon continued legislative authorization of cannabis at the state level. The status quo of, or progress in, the regulated medical-use cannabis industry is not assured and any number of factors could slow or halt further progress in this area. While there may be ample public support for legislative action permitting the manufacture and use of cannabis, numerous factors impact the legislative process. For example, states that voted to legalize medical and/or adult-use cannabis in the November 2016 election cycle have seen significant delays in the drafting and implementation of regulations related to the industry. In addition, burdensome regulation at the state level could slow or stop further development of the medical-use cannabis industry, such as limiting the medical conditions for which medical cannabis can be recommended by physicians for treatment, restricting the form in which medical cannabis can be consumed, imposing significant registration requirements on physicians and patients or imposing significant taxes on the growth, processing and/or retail sales of cannabis, which could have the impact of dampening growth of the cannabis industry and making it difficult for cannabis businesses to operate profitably in those states. FDA regulation of medical-use cannabis and the possible registration of facilities where medical use cannabis is grown could negatively affect the medical-use cannabis industry and its financial condition. Should the federal government legalize cannabis for medical-use, it is possible that the U.S. Food and Drug Administration, or the FDA, would seek to regulate it under the Food, Drug, and Cosmetics Act of 1938. Additionally, the FDA may issue rules and regulations including certified good manufacturing practices, or CGMPs, related to the growth, cultivation, harvesting, and processing of medical cannabis. Clinical trials may be needed to verify efficacy and safety. It is also possible that the FDA would require that facilities where medical-use cannabis is grown register with the FDA and comply with certain federally prescribed regulations. In the event that some or all of these regulations are imposed, it does not know what the impact would be on the medical-use cannabis industry, including what costs, requirements, and possible prohibitions may be enforced. If the Company is unable to comply with the regulations or registration as prescribed by the FDA, the Company may be unable to continue to operate.
The reviewing CPA has included a “going concern” note in the audited financials. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. For the year ended December 31, 2020, the Company had a net operating loss of $1,562,682, an operating cash flow loss of $298,187 and liquid assets in cash of $64,151, which is less than a year of cash reserves as of December 31, 2020. The Company’s situation raises a substantial doubt on whether the entity can continue as a going concern in the next twelve months.
The Company’s ability to continue as a going concern in the next twelve months following the date the financial statements were available to be issued, is dependent upon its ability to produce revenues and/or obtain financing sufficient to meet current and future obligations and deploy such to produce profitable operating results.
Management has evaluated these conditions and plans to generate revenues and raise capital as needed to satisfy its capital needs. During the next twelve months, the Company intends to fund its operations through debt and/or equity financing.
There are no assurances that management will be able to raise funds on terms acceptable to the Company. If it is unable to obtain sufficient funding, it may be required to reduce the scope of its planned development, which could harm its business, financial condition, and operating results. The accompanying financial statements do not include any adjustments that might result from these uncertainties.
The Company has outstanding liabilities. On September 6, 2019, the Company entered a convertible note agreement l in the amount of $50,000. The loan carries a 2% interest and matures in two years. On December 31, 2019, the full amount of this note is reported as long term debt. During 2020 the entire note plus accrued interest was converted to 115 membership shares under VB Brands LLC. Upon the Company’s incorporation as VB Brands, Inc., these membership units were converted to 115,000 common stock shares.
Subsequent to December 31, 2021, the Company issued additional convertible notes to various individuals totaling $1,775,000. Each note has a maturity date of two years from closing date and carries a 5% interest rate. All notes may be converted to common stock prior to their maturity date.
The Company has conducted related party transactions. On December 31, 2020, the company had a short-term loan due to a shareholder for $2,838.
Effective October 21, 2020, the company entered into a management services agreement with Team 7 Holdings of California, Inc. (“Team 7 Holdings”), an entity wholly owned by VB Brands, Inc.’s CEO. The contract provides for a $10,000 monthly management fee for an initial period of four years, which may be automatically extended for four periods of twelve months unless either party has provided written notice no later than 180 days prior to the lapse of the respective term of its desire not to extend the respective period of the term.
On January 1, 2022, this contract was terminated. At time of termination, the Company had a remaining payable to Team 7 Holdings for services rendered of $70,000.
As of December 31, 2020, the company has recorded $23,226 in expenses and accounts payable related to this agreement.
Omri Casspi, a director of the Company, is the majority owner and manager of ASO California, LLC (“ASO”). ASO is a shareholder of the Company. In addition, ASO has entered into multiple agreements with the Company.
Roie Edery, Omri Casspi, and Aleksey Klempner are directors and, directly or through one or more affiliates, shareholders of the Company. Mr. Edery, Mr. Casspi and Mr. Klempner also serve as three of the four directors of KCE Global Solutions Inc. dba Ginger, a Delaware corporation (“Ginger”). Mr. Edery, Mr. Casspi, and Mr. Klempner (through a wholly owned holding company) own the majority of Ginger’s outstanding shares. In addition, Mr. Edery and Mr. Klempner are the sole officers of Ginger (and Ginger’s subsidiaries). Ginger is a direct-to-consumer platform and delivery service for cannabis brands. Ginger provides such services to the Company.
LADevelopers Inc., a California corporation (“LADevelopers”), provides certain technology and software services to the Company. The Company will continue to utilize LADevelopers for similar services in the future. Aleksey Klempner, a director and shareholder of the Company, is the majority shareholder and officer of LADevelopers.
That certain Unsecured Promissory Note by and between the Company and Roie Edery dated March 31, 2021, pursuant to which the Company has promised to pay Mr. Edery a principal amount of $25,000, plus 5% interest per annum.
The Company depends on profitable royalty-bearing licenses of its technology. If the Company is unable to maintain and generate such license agreements, then it may not be able to sustain existing levels of revenue or increase revenue. The Company depends upon the identification, investment in and license of new patents for revenue. If the Company is unable to maintain such license agreements and to continue to develop new license arrangements, then it may not have the resources to identify new technology-based opportunities for future patents and inventions in order to maintain sustainable revenue and growth.
Current or future license agreements may not provide the volume or quality of royalty revenue to sustain business. In some cases, other technology sources may compete against the Company as they seek to license and commercialize technologies. These and other strategies may reduce the number of technology sources and potential clients to whom the Company can market its services. The potential inability to maintain current relationships and sources of technology or to secure new licensees, may have a material adverse effect on business and results of operations.
The Company relies heavily on its technology and intellectual property, but it may be unable to adequately or cost-effectively protect or enforce its intellectual property rights, thereby weakening its competitive position and increasing operating costs. To protect its rights in its services and technology, the Company relies on a combination of copyright and trademark laws, patents, trade secrets, confidentiality agreements with employees and third parties, and protective contractual provisions. It also relies on laws pertaining to trademarks and domain names to protect the value of its corporate brands and reputation. Despite efforts to protect its proprietary rights, unauthorized parties may copy aspects of its services or technology, obtain and use information, marks, or technology that it regards as proprietary, or otherwise violate or infringe its intellectual property rights. In addition, it is possible that others could independently develop substantially equivalent intellectual property. If the Company does not effectively protect its intellectual property, or if others independently develop substantially equivalent intellectual property, its competitive position could be weakened.
Effectively policing the unauthorized use of its services and technology is time-consuming and costly, and the steps it takes may not prevent misappropriation of its technology or other proprietary assets. The Company's efforts to protect its proprietary rights may not be sufficient or effective, and unauthorized parties may copy aspects of its services, use similar marks or domain names, or obtain and use information, marks, or technology that it regards as proprietary. The Company may have to litigate to enforce its intellectual property rights, to protect 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.
The Company has not filed a Form D for its prior offerings. The SEC rules require a Form D to be filed by companies within 15 days after the first sale of securities in the offering relying on Regulation D. Failing to register with the SEC or get an exemption may lead to fines, the right of investors to get their investments back, and even criminal charges. There is a risk that a late penalty could apply.
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 theseshares 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 be 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.
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 $5 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 CLICK. Once CLICK accepts your investment, and certain regulatory procedures are completed, your money will be transferred from the escrow account to CLICK in exchange for your securities. At that point, you will be a proud owner in CLICK.
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
- Your accredited investor status
- Social Security Number or passport
- ABA bank routing number and checking account number (typically found on a personal check or bank statement) or debit card information, unless paying via a Wire transfer.
Non-accredited investors are limited in the amount that he or she may invest in a Reg CF offering during any rolling 12-month period:
- If either the annual income or the net worth of the investor is less than $107,000, the investor is limited to the greater of $2,200 or 5% of the greater of his or her annual income or net worth.
- If the annual income and net worth of the investor are both greater than $107,000, the investor is limited to 10% of the greater of his or her annual income or net worth, to a maximum of $107,000.
Separately, CLICK has set a minimum investment amount of US $1,000.
Accredited investors do not have any 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 CLICK does not plan to list these securities on a national exchange or another secondary market. At some point CLICK 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 CLICK 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 CLICK'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 CLICK's Form C. The Form C includes important details about CLICK'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 prior to the offering end date or an earlier date set by the company. You will be sent a notification at least five business days prior to a closing that is set to occur earlier than the original stated end date giving you an opportunity to cancel your investment if you have 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.