|1||Proven track record of success already - in 2019 alone we completed and fully subscribed 4 major community solar projects with more than 2,000 households.|
|2||A mission-focused company with a B Corp score that leads the entire community solar industry!|
|3||Fastest growing part of the solar market. Community Solar is growing at more than twice the rate of all other solar combined - 53% 5 year growth versus 25|
|4||Built an industry-leading software platform that will help us achieve scale more quickly.|
|5||Market leaders in Maryland - went from 24% of Maryland market share to 36% in less than a year and are growing.|
|6||Featured in Business Insider, NPR, NBC, Solar Power World, and more!|
|7||2019 revenue grew by more than 100% while operating expenses grew by 27%.|
|8||Cost to acquire customers at half the industry average.|
Neighborhood Sun is a leader in the community solar industry and has been developing new software systems to improve both the company operations and the customer experience which will only enhance its performance. Neighborhood Sun is currently the market leader in Maryland and has recently expanded into New Jersey and needs more investment to continue its expanding its footprint into more Northeastern and Midwestern states. It's a unique company with strong leadership with Gary Skulnik, a pioneer in the community solar space, a Board of Directors with industry leaders and independent experts, and a stellar advisory team including former CEO's of solar and energy services companies.
🎶 Do do do doo 🎶
“Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it is the only thing that ever has.” — Margaret Mead
There are simply too many obstacles that prevent a typical household from participating in what most industry leaders agree is the future of power generation. Most Americans either don’t own their homes, don’t have a roof that optimally captures solar, or they don’t have the enormous resources (or desire) to install rooftop solar panels.
Let’s take a look at Stu Simon, a condominium owner in Maryland who cares deeply about the environment, but has no roof on which to install solar panels. Until a couple years ago Stu’s only option was to choose an alternative energy supplier that was 100% wind energy, but he was paying a premium for that service and found that the wind energy was sourced from out of state. He was “doing his part,” but yearned for a way to do more, do it locally, and do it for less money.
Get another glimpse of Stu’s story and others like his in this quick NBC segment on our Maryland Community Solar offer.
“You cannot get through a single day without having an impact on the world around you. What you do makes a difference and you have to decide what kind of a difference you want to make.” — Jane Goodall
Back in 2001, Gary Skulnik was envisioning local solar farms built right here in Maryland. He loved the idea of solar access for all, fighting climate change, and supporting locally produced energy. However, up until 2015, the only way to get solar energy was to install something on your roof. That’s when Gary, working with environmental leaders in Maryland, helped pass the Community Solar Act to allow everyone in the state--homeowners, renters, and condo-owners alike--to share in the benefits of solar. It took a few years for the government to set up the program, but in 2018 it was ready to go, and Stu Simon was one of the first of thousands who subscribed in the first 18 months.
In addition to helping people like Stu, the Community Solar Act also was set up to make a significant portion of this new, clean source of power available to the often marginalized population of low and moderate income “working” families. The dream of power from the sun being available to everyone has been launched.
Community solar is one of the easiest and most affordable ways to get clean energy powering homes. Here’s how it works with Neighborhood Sun:
1. Interested households select a community solar plan in their utility territory. All provide savings, but may differ on contract length, electricity savings, and other terms. They choose the option that works best for their circumstances.
2. They enter their electric utility account & billing information.
3. Their historical electricity needs are analyzed (with information provided by their utility) and they are assigned a share of a community solar project. That share will supply most of their home’s electricity needs (roughly 80%).
4. The solar energy that is generated by their share of the solar farm as “solar credits” and reduces their electricity bill by the full utility rate for that power.
5. They pay Neighborhood Sun each month for those solar credits at a guaranteed lower rate than what your utility is charging them to power their home with dirty energy.
6. The electricity that isn’t covered by their community solar share (roughly 20%) is simply paid to their electric utility provider.
7. And finally, our dedicated team works with the customer, if needed, at every step of the way--helping them choose the best community solar plan, understand their billing details, and adjust their solar share size.
And that’s it! No solar panels installed on the roof or property. There are no fees to join and no one needs to change their utility provider. It takes only minutes on the computer or over the phone to get their home powered with local, clean energy. It can be done during a lunch break (which happens often) and there is still time to eat.
Simply put, we make money by filling up community solar projects, and managing those customers. We’re great at it because Neighborhood Sun’s business model is not typical. Since 2017, we have enrolled more than 2,500 Maryland households through community networks, customer referrals, and partnering with long-standing organizations that have deeply loyal participants.
Our channel partners work with us in ways no other community solar company can match. Our work with progressive faith institutions, environmental groups, non-profits, and other organizations is only made possible by our strong brand credibility and pleased customers. We fill projects with communities of people, rather than one household at a time.
Within three months, we completely filled three of our community solar projects, totaling over 1,500 households - one of those projects being the largest privately-funded residential community solar project in the country.
Each time we fill a project, community solar developers around the country take notice and look to partner with us. We get paid to fill and manage their projects, and no one does it better.
The Maryland market is bringing another 25 Megawatts into the area, and we have the opportunity to expand into other states, such as New York, New Jersey, Massachusetts, and Colorado. Continued growth is all but assured.
Neighborhood Sun is without competition in the way that we solely acquire and manage customers for community solar. We fill the roles that otherwise require two or more companies to manage separately. We are recognized with a 5-star rating on Google Reviews because of the seamless transitions that are made through a customer’s development from prospect to subscriber to brand ambassador.
In addition, we're a certified B Corporation and want to use our business as a true force for good--it's baked into our corporate DNA. As such, we continuously meet rigorous standards of social and environmental performance, accountability, and transparency. We are not just accountable to our shareholders, but to all our stakeholders, such as our employees, customers, the community around us, and our planet.
Society’s most challenging problems cannot be solved by government and nonprofits alone. The B Corp community works toward reduced inequality, lower levels of poverty, a healthier environment, stronger communities, and the creation of more high quality jobs with dignity and purpose. By harnessing the power of business, B Corps use profits and growth as a means to a greater end: positive impact for their employees, communities, and the environment.
An essential aspect of the Neighborhood Sun business model is our commitment to our corporate values:
That is why Neighborhood Sun established our Customer Advocacy Board (CAB).
The CAB is a group of proactive, passionate customers who want to help our company and our cause because they care are invested in their success. They work together with their company to help in a variety of ways. This includes:
1. Being consulted by the company on decisions that will affect the customers
2. Bring concerns to the company that they or the customers they represent have
3. Field test ideas the company may have, to measure impact and reception
4. Brainstorm new solutions for any problems the company is having
Your investment will enable us to bring community solar to even more people by dramatically expanding our footprint. This means we’ll be able to reduce greenhouse gas emissions more quickly, increase the value of the company, and address energy equity in more cities. We will use the funds we raise to:
1. Improve our proprietary software platform for customer management
We’ll upgrade our software platform to allow community solar to scale through greater marketing and sales efforts. This platform will service customers, solar asset owners, and sales organizations that want to join our solar revolution. From a business perspective, this will enable Neighborhood Sun to see even more recurring revenue through our own customer management services as well as licensing out the software to others.
2. Expand to new markets
Community solar is rapidly expanding across the U.S. and we are looking to enter several new markets, such as New York, New Jersey, Illinois, and maybe even Colorado, among others.
3. Hire senior management
While we have a CEO/Founder with years of experience and a great advisory board, we would like to bring on a COO/CTO and a CFO to help us develop strategies to scale our business.
Neighborhood Sun has financial statements ending December 31 2019. Our cash in hand is $300,000, as of June 2020. Over the three months prior, revenues averaged $90,000/month, cost of goods sold has averaged $70,000/month, and operational expenses have averaged $115,000/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.
Neighborhood Sun is a platform that provides customer acquisition and management to connect thousands of residents to community shared solar projects in their area.We are a community solar company dedicated to empowering all individuals to choose solar power. We put our customers first to make sure that clean energy is accessible to everyone, especially those who are the most vulnerable in the face of climate change.
We want to be the top community solar platform in the country, helping fight climate change and save people money through the benefits of shared community solar. Since the start of community solar (less than two years ago), we've acquired more than 1/3 of the market and have helped our state prevent the extraction and combustion of 3.8 million pounds of coal each year.
Neighborhood Sun Benefit Corp was incorporated in the State of Maryland in November 2016.
Since then, we have:
Historical Results of Operations
Our company was organized in November 2016 and has limited operations upon which prospective investors may base an evaluation of its performance.
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 $153,000 in debt and $1,250,000 in equity.
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 12 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
Neighborhood Sun Benefit Corp cash in hand is $300,000, as of June 2020. Over the last three months, revenues have averaged $90,000/month, cost of goods sold has averaged $70,000/month, and operational expenses have averaged $115,000/month, for an average burn rate of $95,000 per month. Our intent is to be profitable in 18 months.
We have enlarged our pipeline of projects substantially, which will lead to an increase in revenue. Further, we completed work on our software platform, so going forward our costs will be lower and our profit higher. Continuing to scale while holding new expenses down will allow us to reach profitability.
In six months, our revenue should increase to an average of $149,000 per month and our expenses should decrease to an average of $143,000, although this cannot be guaranteed.
If we run into a cash shortfall, we have the ability to get a loan from several sources.
The Company has only a limited operating history on which investors may base their evaluation of us and there are various particular risks associated with the Company's community solar business.
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.
Your ability to liquidate your investment is limited because of transfer restrictions, and the lack of a trading market.
We expect to have further needs for capital following this offering, which will result in further need to get new investment.
Ability to Implement and Manage Growth Strategy. Although the Company expects to experience significant growth in a relatively short period of time, and its operations may grow rapidly, the Company’s revenues may not continue to grow at the same rate. Implementation of the Company’s growth strategy may impose a significant strain on the Company’s management, operating systems and financial resources. Failure by the Company to manage its growth, or unexpected difficulties encountered during expansion, could have a material adverse impact on the Company’s results of operations or financial condition.
We could be adversely affected by changes in customer preferences and technology.
There are many risks associated with our expansion.
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.
There are ongoing and future risks from the COVID-19 pandemic that may impact our ability to scale. If the economic fall-out from COVID-19 worsens, there may be less community solar projects financed and built. Stay-at-home orders impact our ability to acquire new customers.
|10||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.|
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