|1||Annual revenue of the kitchen appliances and groceries markets is $838+ billion combined.|
|2||$19.9 million in revenue first 3 years with projected growth to $100 million annually by 2025.|
|3||Mealthy products sell out on Costco.com.|
|4||Moving towards going public in 2021|
|5||Offering quality products at great prices with great technology and phenomenal customer service.|
|6||Mealthy reached profitability in COVID 2020 thanks to increased efficiencies and 31% growth in revenues.|
|7||Expansion into international markets including Mexico, South Africa, India, Europe and the UAE.|
|8||Website and Mobile App receive over 162,000 users per month on average.|
Mealthy has financial statements ending December 31 2019. Our cash in hand is $123,071, as of November 2020. Over the three months prior, revenues averaged $724,395/month, cost of goods sold has averaged $362,197/month, and operational expenses have averaged $252,469/month.
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.
Mealthy is disrupting the kitchen space by designing high quality kitchen products at great prices and easy to follow recipes, all with user friendly technology to continually support our customers to prepare simple, delicious home cooked meals.
Mealthy is a premium kitchen appliance and consumer goods company with a unique approach to product development and sales. Mealthy created and curates an active and growing online community of sophisticated health conscious influencers and consumers.
Mealthy hopes (but not guarantees) to become a $100 million company by 2025.
Mealthy Inc. was incorporated in the State of Delaware in August 2017. Mealthy Inc. is wholey owned by the holding company, MVP Holdings, Inc., which is owned by Jessica Musick and Casey Musick. The intellectual property mentioned in this offering document is owned by Mealthy Inc.
Since then, we have:
Historical Results of Operations
Our company was organized in August 2017 and has limited operations upon which prospective investors may base an evaluation of its performance.
Liquidity & Capital Resources
To-date, the company has been financed with $1,070,000 in SAFEs.
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
Mealthy Inc. cash in hand is $123,071, as of November 2020. Over the last three months, revenues have averaged $724,395/month, cost of goods sold has averaged $362,197/month, and operational expenses have averaged $252,469/month, for an average net margin of $109,729 per month. We are currently profitable.
30% of our operating costs have been reduced over the past 12 months as we found numerous redundancies in the operating platforms that we use as well as an overlap in the talent we had on board. The cost of goods produced has started to go lower as we begin to order larger quantities. We have recognized and resolved inefficiencies in our operations that led to an over development of content that is no longer needed.
Our projections for end of 2020 thru Q2 of 2021 in regards to revenues is projected at approximately $5 million in sales across all platforms not limited to wholesale channels, international distributors and direct to consumer platforms. We aim to incur approximately $4.5M in expenses during the same period. We expect to be profitable within Q1 of 2021. These projections cannot be guaranteed.
For additional capital, we are looking at debt financing options such as PO financing, invoice factoring and inventory financing.
We have a limited operating history upon which you can evaluate our performance, and accordingly, our prospects must be considered in light of the risks that any new company encounters. The Company is still in an early phase and is just beginning to implement its business plan. There can be no assurance that it will ever operate profitably. The likelihood of its success should be considered in light of the problems, expenses, difficulties, complications and delays usually encountered by companies in their early stages of development. The Company may not be successful in attaining the objectives necessary for it to overcome these risks and uncertainties.
The Company may never receive a future equity financing or elect to convert the Securities upon such future financing. In addition, the Company may never undergo a liquidity event such as a sale of the Company or an IPO. If neither the conversion of the Securities nor a liquidity event occurs, the Purchasers could be left holding the Securities in perpetuity. The Securities have numerous transfer restrictions and will likely be highly illiquid, with no secondary market on which to sell them. The Securities are not equity interests, have no ownership rights, have no rights to the Company’s assets or profits and have no voting rights or ability to direct the Company or its actions.
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.
The amount of capital the Company is attempting to raise in this Offering may not be enough to sustain the Company’s current business plan. In order to achieve the Company’s near and long-term goals, the Company may 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 we are not able to raise sufficient capital in the future, we may not be able to execute our business plan, our continued operations will be in jeopardy and we may be forced to cease operations and sell or otherwise transfer all or substantially all of our remaining assets, which could cause a Purchaser to lose all or a portion of his or her investment.
We rely on other companies to provide components and services for our products. We depend on suppliers and subcontractors to meet our contractual obligations to our customers and conduct our operations. Our ability to meet our obligations to our customers may be adversely affected if suppliers or subcontractors do not provide the agreed-upon supplies or perform the agreed-upon services in compliance with customer requirements and in a timely and cost-effective manner. Likewise, the quality of our products may be adversely impacted if companies to whom we delegate manufacture of major components or subsystems for our products, or from whom we acquire such items, do not provide components which meet required specifications and perform to our and our customers’ expectations. Our suppliers may unable to quickly recover from natural disasters and other events beyond their control and may be subject to additional risks such as financial problems that limit their ability to conduct their operations. The risk of these adverse effects may be greater in circumstances where we rely on only one or two subcontractors or suppliers for a particular component.
Collection of customer data. Through the Company’s website and applications, the Company collects personal information from its customers and users. While the Company takes steps to protect this data, there is a risk that the data could become compromised. Additionally, the Company may now or in the future be subject to various privacy regulations and laws in the jurisdictions in which it operates.
Use of Proceeds Risks. The Company intends to primarily use the proceeds to purchase inventory. Depending on the amount raised, the Company may use the full amount it receives from this offering to purchase additional inventory. If the Company is unable to sell the inventory, the Company could be left with unsellable inventory, which could impact the Company’s ability to continue its operations.
Additional business risk. The Company sells physical consumer goods, and there is a risk that a percentage of those goods could turn out to be faulty. If this occurs, the Company could incur losses due to warranty requirements or resolving claims by consumers of a faulty product which caused harm to persons or property. The Company obtains many of its components for producing its products from overseas vendors. This creates international governmental and regulatory risk related to the general economic climate of both the United States and other countries, including potential tariffs or other trade related matters associated with the purchase and production of overseas goods. The Company’s success is dependent on the Company’s ability to promote and sell its products. There is a risk that the Company will be unable to successfully find partners, promoters, and retailers that are necessary to promote its products to the market. There is a limited market in which to sell the Company’s products, and the Company is a new entrant into this market. There is risk that the Company will not be able to obtain sufficient market share or that the market is insufficient to support the Company’s overall business and goals.
The Company is not subject to Sarbanes-Oxley regulations and may lack the financial controls and procedures of public companies. The Company may not have the internal control infrastructure that would meet the standards of a public company, including the requirements of the Sarbanes Oxley Act of 2002. As a privately-held (non-public) Company, the Company is currently not subject to the Sarbanes Oxley Act of 2002, and it's financial and disclosure controls and procedures reflect its status as a development stage, non-public company. There can be no guarantee that there are no significant deficiencies or material weaknesses in the quality of the Company's financial and disclosure controls and procedures. If it were necessary to implement such financial and disclosure controls and procedures, the cost to the Company of such compliance could be substantial and could have a material adverse effect on the Company's results of operations.
We may implement new lines of business or offer new products and services within existing lines of business. As an early-stage company, we may implement new lines of business at any time. There are substantial risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed. In developing and marketing new lines of business and/or new products and services, we may invest significant time and resources. Initial timetables for the introduction and development of new lines of business and/or new products or services may not be achieved, and price and profitability targets may not prove feasible. We may not be successful in introducing new products and services in response to industry trends or developments in technology, or those new products may not achieve market acceptance. As a result, we could lose business, be forced to price products and services on less advantageous terms to retain or attract clients, or be subject to cost increases. As a result, our business, financial condition or results of operations may be adversely affected.
We may not be able to retain and/or hire key management and employees. The success of and ability to implement our business plan will depend upon the continued contributions of key management. The loss of the services of certain of these executives would have a material adverse effect. In addition, as we continue to execute on our business plan, we will require the hiring of additional qualified management and personnel. There is no guarantee that we will be able to attract such personnel.
We rely on third parties to provide our primary technology and merchant services. We currently rely on third parties to provide the backbone of our technology and merchant services. These companies include Amazon, Amazon Web Services, Shopify, Google Suite, Slack, and other companies. Any disruptions to these third-party services might cause system interruptions and delays and loss of critical data and could diminish our reputation and brand name.
Intellectual property claims or defense could affect our primary business. We do not believe that any of our products or services infringe upon the intellectual property rights of third parties in any material respect. There can be no assurance, however, that third parties will not claim infringement with respect to current or future products, services, or activities. Any infringement claim, with or without merit, could result in substantial costs and diversion of management and financial resources, and could therefore have a material adverse effect.
Temporary Rule 201(z)(2) provides temporary relief from certain financial information requirements by allowing issuers to omit the financial statements required by Rule 201(t) in the initial Form C filed with the Commission. This offering has commenced in reliance of Temporary Rule 201(z)(2) and, as a result, the following must be disclosed: (i) the financial information that has been omitted is not otherwise available and will be provided by an amendment to the offering materials; (ii) the investor should review the complete set of offering materials, including previously omitted financial information, prior to making an investment decision; and (iii) no investment commitments will be accepted until after such financial information has been provided.
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