Your browser is old and is not supported. Upgrade for better security.

Invest in The Drivers Cooperative

A ridehailing platform owned by workers, not billionaire founders and venture capital

Financials

We have financial statements ending December 31 2020. Our cash in hand is $170,676, as of July 2021. Over the three months prior, revenues averaged $14,647/month, cost of goods sold has averaged $588/month, and operational expenses have averaged $12,018/month.

At a Glance

Apr 24 - Dec 31
$2,314
Revenue
$5,455
Net Profit
$3,069
Short Term Debt
$0
Raised in 2020
$170,676
Cash on Hand
Net Margin:
236%
Gross Margin:
-4%
Return on Assets:
64%
Earnings per Share:
$23.72
Revenue per Employee:
$331
Cash to Assets:
100%
Revenue to Receivables:
~
Debt Ratio:
36%
Drivers Coop Financials and CPA Review Report Final.pdf

Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this offering. Some of the information contained in this discussion and analysis, including information regarding the strategy and plans for our business, includes forward-looking statements that involve risks and uncertainties. You should review the "Risk Factors" section for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

The Drivers Cooperative is a driver-owned transportation cooperative. Drivers collect a much larger share of the fare and profits go back to drivers. Most importantly, drivers have a seat at the table and democratic participation in the decisions that impact their lives.

In the next 5 years, we aim to have at least 2.5 - 10% of the market in ten major metropolitan areas globally. These projections cannot be guaranteed.

Milestones

The Drivers Cooperative, Inc. was incorporated in the State of New York in April 2020. We are incorporated as a Worker Cooperative Corporation.

Since then, we have achieved:

Launched in New York City in late May 2021

>3,500 drivers recruited to the platform

>30K rider accounts in the app

> 2,000 completed trips

>$85K in revenue generated

B2B/B2G clients including AOC and the NYC Board of Elections

>10K followers on both Twitter and > 8k on Instagram

Historical Results of Operations

Our company was organized in April 2020 and has limited operations upon which prospective investors may base an evaluation of its performance.

  • Revenues & Gross Margin. For the period ended December 31, 2020, the Company had revenues of $2,314.
  • Assets. As of December 31, 2020, the Company had total assets of $8,519, including $8,519 in cash.
  • Net Income. The Company has had net income of $5,455 for 2020.
  • Liabilities. The Company's liabilities totaled $3,069 for 2020.

Liquidity & Capital Resources

To-date, the company has been financed with $270,000 in debt.

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 18 months before we need to raise further capital.

We plan to use the proceeds as set forth in this Form C under "Use of Funds". We don’t have any other sources of capital in the immediate future.

We will likely require additional financing in excess of the proceeds from the Offering in order to perform operations over the lifetime of the Company. We plan to raise capital in 18 months. Except as otherwise described in this Form C, we do not have additional sources of capital other than the proceeds from the offering. Because of the complexities and uncertainties in establishing a new business strategy, it is not possible to adequately project whether the proceeds of this offering will be sufficient to enable us to implement our strategy. This complexity and uncertainty will be increased if less than the maximum amount of securities offered in this offering is sold. The Company intends to raise additional capital in the future from investors. Although capital may be available for early-stage companies, there is no guarantee that the Company will receive any investments from investors.

Runway & Short/Mid Term Expenses

The Drivers Cooperative, Inc. cash in hand is $170,676 as of July 2021. Over the last three months, revenues have averaged $14,647/month, cost of goods sold has averaged $588/month, and operational expenses have averaged $12,018/month, for an average net margin of $2,041 per month. We are currently profitable.

Since the date our financials cover, we have expanded our GoVote program to bring voters to the polls and our contract with the Board of Elections. We also grew our team to facilitate operations and driver and rider outreach.

Additionally, on February 10, 2021, the Company entered into a revenue sharing agreement for $20,000 with a remittance rate of 2.5% of gross revenue per quarter until $60,000 is paid back. The purchaser of this note also has the option to convert to shares of preferred stock equal to $60,000 minus total revenue payments to date, divided by price per share during the next financing round.

On February 10, 2021, the Company entered into a loan agreement for $40,000 with an interest rate of 4.99% and maturity date of March 3, 2028.

On February 12, 2021, the Company has entered into a loan agreement for $10,000 with an interest rate of 8% and maturity date of August 12, 2022.

On February 15, 2021, the Company entered into a loan agreement for up to $200,000 with $100,000 available upon closing, and an additional $100,000 if certain criteria are met during the following three months. This loan contains an interest rate of 7.75% and maturity date of August 15, 2023. 

Over the next 3-6 months, we expect an average monthly growth rate of 28% in consumer ride-hailing commissions and an increase in payroll costs to $30,000 independent of the fundraise as volunteer team members come full-time. Total revenues July - Sept are projected to be $75k and total expenses are projected to be $140k. These projections cannot be guaranteed.

Outside of funds raised in this offering, our sources of capital are administrative fees from business and government contracts, consumer trip commissions, and non-dilutive funding through grants and donations. 

Risks

1

Key Personnel. The Cooperative’s success substantially depends on the efforts of its Founding Members Erik Forman, Alissa Orlando, and Martin Ken Lewis. Investors must rely upon the judgment and skills of these Founding Members. The Cooperative’s success also depends upon its drivers, both members and non-members, as well as its ability to recruit, train, and retain qualified drivers. The loss of the services of any of key personnel, or Cooperative’s inability to recruit, train, and retain qualified drivers, may have a material adverse effect on the Cooperative’s business and financial condition. Nonetheless, the Cooperative does have an established plan to replace key personnel in the case of death, resignation, or disability.  The Board will call a special or regular meeting among the driver-members in order to replace the aforementioned key personnel so that the operations of the Cooperative may continue. 

2

Our future success depends on the efforts of a small management team. The loss of services of the members of the management team may have an adverse effect on the company. There can be no assurance that we will be successful in attracting and retaining other personnel we require to successfully grow our business.

3

Risks Inherent to Worker Cooperatives. A worker cooperative is defined as a corporation that is owned and controlled by its workers. Although this business form is increasing in popularity, it is still a relatively new concept for many consumers. As a worker cooperative, the Cooperative has a democratic governance structure amongst its membership whereby each driver-member is entitled to one vote per member (rather than the more common one vote per share). Given its democratic structure, the Cooperative’s strategic direction is not at the sole discretion of the Board of Directors, Officers, or Management Team. While major strategic and financial decisions are made by the Board of Directors, the Board is elected by driver-members and certain staff, as outlined in the bylaws. Decisions that most directly impact the everyday lives of driver-members, such as potential disciplinary action, are in the hands of a Driver Board elected by the driver-members.  The Cooperative has adopted this democratic structure in order to align incentives between stakeholders, which the Founding Team believes will create a stronger Cooperative and a more unique value proposition for both driver-members  and consumer-riders. However, because decisions are made democratically, and due to the community-centered nature of cooperatives, the driver-members and staff of the Cooperative may consider values other than the maximization of short-term profits in their operational decisions, such as devoting resources to social benefits and a social safety net for driver-members, or to campaigns designed to shape public policy that benefit ride-share drivers and their consumer riders, such as  policies promoting  free and accessible public restrooms and public subsidies for electric vehicles, for example. These activities do contribute to and enhance the central value proposition of the Cooperative, but they could affect the profits of the Cooperative, and make the Cooperative a target of unusual and unpredictable retaliatory action from competitors and other hostile parties.


Other Disclosures

The Board of Directors

Director Occupation Joined
Erik Forman Management @ The Drivers Cooperative, Inc. 2020
Alissa Orlando Management @ The Drivers Cooperative, Inc. 2021
Ken Lewis Management @ The Drivers Cooperative, Inc. 2021
Mohammed Hossen Driver @ Self-employed 2021
Steve Sleigh Consultant @ Sleigh Strategies LLC 2021

Officers

Officer Title Joined
Erik Forman President   President   2020
Alissa Orlando Treasurer   Treasurer   2021
Ken Lewis Vice President   Vice President   2021
Mohammed Hossen Secretary   Secretary   2021

Voting Power

No one has over 20% voting power.

Past Equity Fundraises

Date Security Amount
Custom $70,777
03/2021 Loan $10,000
02/2021 Loan $200,000
02/2021 Convertible Note $20,000
02/2021 Loan $40,000

Convertible Notes Outstanding

Issued Amount Valuation Cap
02/12/2021
$20,000
$0

Outstanding Debts

Issued Lender Outstanding
02/10/2021 Lower East Side People's Federal Credit Union
$38,500
02/15/2021 Shared Capital Cooperative
$200,000
03/03/2021 Local Enterprise Assistance Fund (LEAF)
$10,000

Related Party Transactions

None.

Use of Funds

$50,000 93.5% towards three months salary for engineering team (three people); 6.5% Wefunder fees

$1,070,000 56% towards payroll for engineering, marketing, and operations teams 23% for rider and driver marketing 14.5% SG&A, 6.5% Wefunder fees

$2,500,000 If the round were to become oversubscribed, we'd plan to use funds as follows... 57% towards 24 months of payroll including for engineer, marketing, operations, and management teams 19% towards 18 months of rider and driver marketing expenses 17.5% towards expansion funds for second and third cities 6.5% Wefunder fees

Capital Structure

Class of Security Securities
(or Amount)
Authorized
Securities
(or Amount)
Outstanding
Common 1,000,000 230

The Funding Portal

The Drivers Cooperative is conducting a Regulation Crowdfunding offering via Wefunder Portal LLC. CRD Number: #283503.

Form C Filing on EDGAR

The Securities and Exchange Commission hosts the official Form C on their EDGAR web site.

Details