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Invest in Royal Caridea

Transform the shrimp production industry while addressing unmet market needs

EARLY BIRD TERMS: $161,310 LEFT

$78,690

raised from 53 investors
INVESTMENT TERMS
 $8.8M  $7M pre-money valuation Priced Round
Early Bird Bonus: The first $240K of investments will be at $0.80 per share and a $7M pre-money valuation
$2.5K, $5K, $10K
LEAD INVESTOR
I have invested previously, and again at this time, in Royal Caridea because of the passion, experience, and technical expertise of its founders. Royal Caridea's mission is to produce great tasting, locally grown shrimp and to offer this to customers across the USA all year round, including ‘live shrimp’ and ‘fresh never frozen’ options. I am a co-founder of Devonian Capital, an international investment business focused on land-based fish and shrimp farming businesses with a strong technology component. Along with my colleagues at Devonian I have been investing in, and working closely with, a number of land-based aquaculture projects over the last 5 years. Having followed Royal Caridea's progress for a few years I invested personally in Royal Caridea last year alongside additional investments from my colleagues at Devonian. Seafood generally, and shrimp in particular, is a popular source of tasty and healthy protein. But there are numerous concerns about the sustainability of current shrimp production methods. Consumers want access to options that are fresher, more local, and, importantly, more sustainable. The Royal Caridea team has developed a great solution for this challenge. Their patent-protected production method of growing shrimp in a novel stacked raceway system maximizes control while minimizing the footprint of the site. This sector has huge potential, and shrimp is an immensely popular product in the USA. Royal Caridea also has huge potential and I’m excited to support this great team!

Financials

We have financial statements ending December 31, 2021. Our cash in hand is $430,000, as of October 2022. Over the three months prior, revenues averaged $12,564/month, cost of goods sold has averaged $7,845/month, and operational expenses have averaged $62,127/month.

At a Glance

Jan 1 – Dec 31, 2021
$140,006
+79X
Revenue
-$867,165
Net Loss
$116,711
+19%
Short-Term Debt
$946,505
Raised in 2021
$430,000
+79X
Cash on Hand
Net Margin:
-619%
Gross Margin:
44%
Return on Assets:
-28%
Earnings per Share:
-$0.13
Revenue per Employee:
$35,001.50
Cash to Assets:
9%
Revenue to Receivables:
354%
Debt Ratio:
134%
ROYAL CARIDEA Financial Statement Review for 2020 and 2021.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

Royal Caridea is a high-tech shrimp farming company focused on bringing to commercialization its transformative GEN 2 Shrimp Farming Technology (GEN-2)

In five years Royal Caridea hopes the technology will be fully exploited, the company to be profitable, and acquired by a seafood company. Some of the offshore opportunities through licensing or co-ownership in Europe, North America, Australia, and other select countries will most likely be consummated.  These projections cannot be guaranteed.  

Milestones

Royal Caridea LLC was incorporated in the State of Delaware in June 2009.

Since then, we have:

  • Already raised $935,000 from Series A Preferred Offering
  • Patented in USA and Australia; Pending in EU. GEN-2 is ready for commercialization.
  • GEN 2 Shrimp Farming is a Super Intensive Raceway Shrimp Farming Technology (SIRSFT)
  • Provide high-quality live shrimp 365 days a year anywhere in the world
  • Shrimp are grown disease free, with consistent harvest volumes, and highly-reduced crop losses
  • Raised funds through Harvest Returns, a dedicated Agricultural-focused crowdfunding platform
  • Revenues are projected to increase rapidly as production scales up (not guaranteed)

Historical Results of Operations

  • Revenues & Gross Margin. For the period ended December 31, 2021, the Company had revenues of $140,006 compared to the year ended December 31, 2020, when the Company had revenues of $1,747. Our gross margin was 44.17% in fiscal year 2021, compared to -22.27% in 2020.
  • Assets. As of December 31, 2021, the Company had total assets of $3,130,461, including $281,454 in cash. As of December 31, 2020, the Company had $2,775,891 in total assets, including $191,373 in cash.
  • Net Loss. The Company has had net losses of $867,165 and net losses of $899,945 for the fiscal years ended December 31, 2021 and December 31, 2020, respectively.
  • Liabilities. The Company's liabilities totaled $4,083,279 for the fiscal year ended December 31, 2021 and $2,701,763 for the fiscal year ended December 31, 2020.

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 $2,706,200 in debt, $1,680,305 in equity, and $420,000 in convertibles.

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 6 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

Royal Caridea LLC cash in hand is $430,000, as of October 2022. Over the last three months, revenues have averaged $12,564/month, cost of goods sold has averaged $7,845/month, and operational expenses have averaged $62,127/month, for an average burn rate of $57,408 per month. Our intent is to be profitable in 26 months.

Since the date our financials cover there are no material changes in our finances or operations. We have updated our horizontal raceway system and we expect to start seeding these raceways in November 2022 with sales starting in February 2023 generating between $28,000 to $42,000 per month. This production will be continuous. With margins over 50% it will extend our runway for each month that we generate sales.

Royal Caridea expects revenue approaching $100,000 over the next six months and expenses of approximately of $300,000.

Royal Caridea is not profitable at this time. We hope to be profitable in December 2024. With the Series B funds of about $1M, Royal will have sufficient funds to operate the business until our next projected raise in late 2023. We plan to raise an additional $4M in equity and up to $4M in debt in the late Summer of 2023. These funds will allow Royal to build out a full plant with production approximating 1.3M lbs. annually. Meaning in 2024 we expect to generate about $5.1M revenue, $1.82M in EBITDA and net cash flow of about $745,000. Following we expect to continue to be profitable with a potential exit in the period 2025 to 2027.

Royal Caridea currently has capital to cover short-term burn throughout the campaign. In March 2012 Royal Caridea raised $725,000 from founders, friends and family. We used the funds to set up the company and fund our research and development. In July 2020, Royal Caridea secured a USDA secured loan for $2.2M for equipment, infrastructure development and shrimp operations. Currently Royal has $220,000 remaining as cash on-hand from loan proceeds.  In January 2021 we raised $420,000 in the form of a Convertible Note. The funds were used to meet some debt payments and continue funding patent applications. Additionally, Royal Caridea secured a $500K USDA secured loan in May 2021. Then in February 2022 we started our Series A raise and engaged a Venture Capital firm, that along with Royal Caridea founders, invested $155,000. Royal Caridea then completed the Series A round in August 2022 and received $727,000 net of costs and fees. Additionally, Royal Caridea has approximately $220,000 in a reserve account held by our USDA lender, which could be made available if necessary, but we would have to replenish the funds in the future.

The projections above are forward looking and cannot be guaranteed.

Risks

1

Sales: The primary revenue/profitability risks are the Company’s ability to manage construction costs and deadlines, moving the technology from pilot plant success to full-scale production success, maintaining the price structure as defined in the Proforma meeting, or exceeding the sales forecast, and controlling the cost of production.

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

Delays: Unexpected delays due to various reasons including permitting, government, and/or regulatory approvals that may be required, and delivery of products and parts from 3rd party manufacturers that will be required for plant construction and ongoing operation.


Other Disclosures

The Board of Directors

Director Occupation Joined
Maurice Kemp CEO @ Royal Caridea, LLC 2009
Michael Cunha CFO @ Royal Caridea, LLC 2009

Officers

Officer Title Joined
Maurice Kemp Managing Member 2009
Michael Cunha Manage Member 2009

Voting Power

No one has over 20% voting power.

Past Fundraises

Date Security Amount
Current Priced Round $77,790
8/2022 Priced Round $780,000
2/2022 Priced Round $155,000
10/2021 Priced Round $20,305
6/2021 Loan $6,200
5/2021 Loan $500,000
2/2021 Convertible Note $420,000
7/2020 Loan $2,200,000
3/2012 Priced Round $725,000

Convertible Notes Outstanding

Issued Amount Valuation Cap
2/1/21
$420,000
$8,654,820

Outstanding Debts

Issued Lender Outstanding
7/27/20 Royal Caridea
$2,142,124
5/14/21 Royal Caridea, LLC
$500,000

Related Party Transactions

Use of Funds

$75,000 70% prepare the  facilities for raceway installation, 22.5% Hire Marketing Director and 7.5% Wefunder Fees.

$240,000 40% prepare the  facilities for raceway installation, 30% bringing additional Raceways online, 22.5% Hire Marketing Director and 7.5% Wefunder Fees.

$570,000 40% prepare the  facilities for raceway installation, 30% bringing additional Raceways online, 22.5% Hire Marketing Director and 7.5% Wefunder Fees.

$900,000 40% prepare the  facilities for raceway installation, 30% bringing additional Raceways online, 22.5% Hire Marketing Director and 7.5% Wefunder Fees.

$1,065,000 20% prepare the  facilities for raceway installation, 22.5% Hire Marketing Director and 7.5% Wefunder Fees.20% to increase marketing budget, 20% to invest in live haul transportation10% to increase the company's reserve funds.

Capital Structure

Class of Security Securities (or Amount) Authorized Securities (or Amount) Outstanding
Common 16,000,000 5,777,207
Preferred 9,000,000 1,045,000

The Funding Portal

Royal Caridea 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