|1||$1T Market: SUV/Pickup Truck/Minivan/RV Replacement|
|2||Proven Demand: $12M deposit backed reservations, $6M signed sales orders, $3.6M revenue|
|3||Proven Operations: 50+ Customer Deliveries, Building 6 CV1s/month (and growing fast)|
|4||Competitive Advantages: 3+ Patents Pending, Rapid Design, MRP, Direct to Consumer Sales|
I met PJ and Laurie a couple of years ago as they were on a journey to build a business that was filling a void in the market. I believe in the leadership of PJ and Laurie as they continue to grow and expand ModVans. They have proven their ability to guide and lead their team through critical operational successes. They have a vision for ModVans that I agree with - one that focuses on satisfying their customers and delivering a quality product. With this vision I believe they are on a pathway to success.
A smart alternative to owning three separate vehicles for family, work, and play. ModVans CV1 is the superhero of campervans, hauling kids to and from soccer practice by day and road-tripping by night, it’s a cargo van for work during the week and living space for play on weekends; it’s an adventure van that doubles as a daily driver.
Multipurpose Vehicles Great for Vacay and Everyday
A $1 Trillion Market
Can the CV1 really really replace an SUV or Pickup Truck? 5 years ago, our founders replaced an aging 7 passenger SUV with the CV1 prototype and we haven't looked back! 3 of our first 5 preorders were to families with kids. Since then, over 50% of our deliveries are to families replacing a daily driver. Critically, with available RV financing, insurance and warranties, the CV1 is more affordable on a monthly basis.
We first connected with buyers through ads on Craigslist. Response to our offering was so sensational that we hit our goal of 5 preorders and stopped all paid advertising after only a month. Since then, all sales have come from unpaid organic growth via Google searches, customer referrals and mentions online and in the press. Since our launch in mid-2017, we have $12M in deposit backed reservations, $6M signed sales orders and $3.6M revenue from CV1s delivered to happy customers.
Market response to the ModVans CV1 has been so phenomenal that production cannot meet demand. We want to meet that demand head on! Rather than make people wait for years as we bootstrap our way to expansion, we decided to launch this crowdfunding campaign.
During the COVID-19 pandemic, ModVans has grown sales and delivered completed CV1s to customers. Navigating supply chain issues has been challenging (to say the least), but we are surviving and thriving!
In 2.5 years, ModVans has achieved the following milestones:
You can read more about our recent progress at https://www.linkedin.com/pulse/modvans-moves-bigger-digs-makes-plans-survive-covid-19-p-j-tezza/ and https://www.linkedin.com/pulse/modvans-production-capacity-expansion-p-j-tezza/.
If you have any doubts about our ability to successfully operate the business, feel free to schedule an in person visit at our shop in Oxnard, CA!
ModVans has these key barriers to competition:
While we have large, well financed competitors, it takes those companies years and millions of dollars to bring new products to market. Smaller competitors would have to spend thousands of hours in R&D, gain critical certifications and build up a large stockpile of chassis.
ModVans has financial statements ending December 31 2019. Our cash in hand is $143,760.03, as of October 2020. Over the three months prior, revenues averaged $263,271/month, cost of goods sold has averaged $235,440/month, and operational expenses have averaged $108,400/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.
ModVans builds multipurpose camping vehicles for family, work and play. Our CV1 camper van comes standard with safe, comfortable seating for 5 passengers, 2 beds and removable RV components. We have high demand and are in production with over 50 vehicles delivered to customers all across the US.
The CV1 camper van is the only mass production, multipurpose “soccer mom” compatible RV with good MPG, easy driving and parking, safe and comfortable 2nd row seats and slick enough styling for mass market appeal. Our goal is to acquire part of the market for SUVs, pickup trucks and minivans, currently worth over $1 trillion/year in the US.
WebTez, Inc. d/b/a ModVans was incorporated in the State of Georgia in February 2012.
Since then, we have:
Historical Results of Operations
Related Party Transaction
Refer to Question 26 of this Form C for disclosure of all related party transactions.
Liquidity & Capital Resources
To-date, the company has been financed with $416,109 in debt and $1,315,872 in equity.
After the conclusion of this Offering, should we hit our minimum funding target, we hope to have indefinite runway without needing 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 6 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
WebTez, Inc. d/b/a ModVans cash in hand is $143,760.03, as of October 2020. Over the last three months, revenues have averaged $263,271/month, cost of goods sold has averaged $235,440/month, and operational expenses have averaged $108,400/month, for an average burn rate of $80,569 per month. Our intent is to be profitable in 1 months.
Since the date of our financials, we have moved from a 2,400 square feet space to a 8,400 square feet space with rent increase. We have also increased from 6 to 12 full-time employees, and increased production from 2 to 6 vehicles per month.
Within six months, we hope to be generating $1.2M in monthly revenues and $1.2M in monthly expenses+COGS, although these projections cannot be guaranteed.
For additional capital outside of this Offering, we have inventory and other assets we can sell. We can accept sales orders for partial and/or custom conversions. We can increase the amount of deposit required to reserve a build. The founders or other investors may be able to lend the company additional funds. We may be able to borrow against signed sales orders.
An investment in the Company (also referred to as “we”, “us”, “our”, or “Company”) involves a high degree of risk and should only be considered by those who can afford the loss of their entire investment. Furthermore, the purchase of any of the Class B Non Voting shares should only be undertaken by persons whose financial resources are sufficient to enable them to indefinitely retain an illiquid investment. Each investor in the Company should consider all of the information provided to such potential investor regarding the Company as well as the following risk factors, in addition to the other information listed in the Company’s Form C. The following risk factors are not intended, and shall not be deemed to be, a complete description of the commercial and other risks inherent in the investment in the Company.
Our business projections are only projections
There can be no assurance that the Company will meet our projections. There can be no assurance that the Company will be able to find sufficient demand for our product, that people think it’s a better option than a competing product, or that we will able to provide the service at a level that allows the Company to make a profit and still attract business.
Any valuation at this stage is difficult to assess
The valuation for the offering was established by the Company. 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.
The transferability of the Securities you are buying is limited
Any Class B Non-Voting Common Stock purchased through this crowdfunding campaign is subject to SEC limitations of transfer. This means that the stock that you purchase cannot be resold for a period of one year. The exception to this rule is if you are transferring the stock back to the Company, to an “accredited investor,” as part of an offering registered with the Commission, to a member of your family, trust created for the benefit of your family, or in connection with your death or divorce.
Your investment could be illiquid for a long time
You should be prepared to hold this investment for several years or longer. For the 12 months following your investment there will be restrictions on how you can resell the securities you receive. More importantly, there is no established market for these securities and there may never be one. As a result, if you decide to sell these securities in the future, you may not be able to find a buyer. The Company may be acquired by an existing player in the RV industry. However, that may never happen or it may happen at a price that results in you losing money on this investment.
Terms of subsequent financings may adversely impact your investment
We will likely need to engage in common equity, debt, or preferred stock financings in the future, which may reduce the value of your investment in the Common Stock. Interest on debt securities could increase costs and negatively impact operating results. Preferred stock could be issued in series from time to time with such designation, rights, preferences, and limitations as needed to raise capital. The terms of preferred stock could be more advantageous to those investors than to the holders of Common Stock. In addition, if we need to raise more equity capital from the sale of Common Stock, institutional or other investors may negotiate terms that are likely to be more favorable than the terms of your investment, and possibly a lower purchase price per share.
Management Discretion as to Use of Proceeds
Our success will be substantially dependent upon the discretion and judgment of our management team with respect to the application and allocation of the proceeds of this Offering. The use of proceeds described below is an estimate based on our current business plan. We, however, may find it necessary or advisable to re-allocate portions of the net proceeds reserved for one category to another, and we will have broad discretion in doing so.
Projections: Forward Looking Information
Any projections or forward looking statements regarding our anticipated financial or operational performance are hypothetical and are based on management's best estimate of the probable results of our operations and will not have been reviewed by our independent accountants. These projections will be based on assumptions which management believes are reasonable. Some assumptions invariably will not materialize due to unanticipated events and circumstances beyond management's control. Therefore, actual results of operations will vary from such projections, and such variances may be material. Any projected results cannot be guaranteed
Minority Holder; Securities with No Voting Rights
All of the Class A Voting Common Stock is held by Peter Tezza and Laura Tezza. The Class B Non-Voting Common Stock that an investor is buying has no voting rights attached to them. This means that you will have no rights in dictating on how the Company will be run. You are trusting in management discretion in making good business decisions that will grow your investments.
We face significant market competition
We will compete with larger, established companies who currently have products on the market and/or various respective product development programs. They may have much better financial means and marketing/sales and human resources than us. They may succeed in developing superior products than those developed by us. There can be no assurance that competitors will not render our technology or products obsolete or that the products developed by us will be preferred to any newly developed technologies. It should further be assumed that competition will intensify.
We are an early stage company and have limited revenue and operating history
The Company has a short history. If you are investing in this company, it’s because you think that ModVans is a good idea, that the team will be able to successfully market and sell our products, that we can price the product accurately and sell and deliver enough units that the Company will succeed. The company just began producing 6 vehicles a month in October 2020. Inability to fulfill orders for pre-sold RVs could result in negative publicity. The company has outstanding debt liabilities such as the loan from Newtek and expects to incur significant increases in expenses as it ramps up operations.
The loss of one or more of our key personnel, or our failure to attract and retain other highly qualified personnel in the future, could harm our business
To be successful, the Company requires capable people to run its day to day operations. As the Company grows, it will need to attract and hire additional employees in sales, marketing, design, development, operations, finance, legal, human resources and other areas. Depending on the economic environment and the Company’s performance, we may not be able to locate or attract qualified individuals for such positions when we need them. We may also make hiring mistakes, which can be costly in terms of resources spent in recruiting, hiring and investing in the incorrect individual and in the time delay in locating the right employee fit. If we are unable to attract, hire and retain the right talent or make too many hiring mistakes, it is likely our business will suffer from not having the right employees in the right positions at the right time. This would likely adversely impact the value of your investment.
We rely on third parties to provide services essential to the success of our business
We rely on third parties to provide a variety of essential business functions for us, including manufacturing, shipping, accounting, legal work, public relations, advertising, retailing, and distribution. It is possible that some of these third parties will fail to perform their services or will perform them in an unacceptable manner. It is possible that we will experience delays, defects, errors, or other problems with their work that will materially impact our operations and we may have little or no recourse to recover damages for these losses. A disruption in these key or other suppliers’ operations could materially and adversely affect our business. As a result, your investment could be adversely impacted by our reliance on third parties and their performance.
Risks associated with manufactured products
The Company manufactures products that have the potential to be involved in injuries or deaths. Liabilities beyond our insurance coverage could materially and adversely impact the value of your investment. Loss of insurance coverage for manufactured products or prohibitively expensive insurance coverage for manufactured products could materially and adversely impact the value of your investment.
In the event of a liquidation of our company, you will only be paid out if there is any cash remaining after all of the creditors of our company have been paid out.
Our ability to sell our product is dependent on outside government regulation which can be subject to change at any time
Our ability to sell our products is dependent on outside government regulation such as the DOT and FMVSS and other relevant government laws and regulations. The laws and regulations concerning the selling of our product maybe be subject to change and, if they do, the selling of product may no longer be in the best interest of the Company. At such point, the Company may no longer want to sell the product therefore your investment in the Company may be affected
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.
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