|1||Located in the fastest-growing town in Vermont this decade.|
|2||Strong team of Vermont brewers with decades of experience. Unique recipes.|
|3||No Rent. Building is owned. Annual cost savings of $70K per year to the bottom line.|
|4||Overall costs are 75% lower than other brewers.|
|5||No debt. Self-funded to reach 80% completion as of this campaign.|
|6||Brand easy to remember, universally recognizable for domestic and international growth.|
|7||Unique concept not utilized by other brewing operations.|
|8||Giving back to our military, police and fire fighters who serve or have served.|
We want to bring something new to our home town of Morrisville, Vermont by showcasing the untapped potential of local brew-artists looking to express their creativity and passion for beer. With your help, we will make this community continue to thrive in a way that honors our country and veterans, while also looking forward to encouraging innovative growth in the craft beer industry.
While U.S. beer volume sales were down 1% in 2018, craft brewer sales continued to grow at a rate of 4% by volume, reaching 13.2% of the U.S. beer market by volume. Craft production grew the most for microbreweries.
As for the use of funds, $240K will go towards brewing equipment. The balance is for operating capital, including brewing ingredients, utilities, insurance fees, advertising, staff and a cushion for any unknown expenses that could happen. For example, we may need an additional piece of equipment over time if we find that we achieve our goals ahead of schedule and have to contract brew for distribution. Since we already have over $500k of our own funds into this, our capital needs are quite low to open our doors.
The biggest predicted overhead for us will be water and fuel. Once we are in production and can open to the public, it will increase. That said, with an increased water bill, it also means an increase in demand for our product, so we will gladly take this as a sign of success. Our plan is to set aside all funds that aren’t initially going back into the operating system, and put them into the future operating account, so we are well-positioned to grow when the time is right. By considering how the brewery will conserve cash flow ahead of time, we will be able to enhance shareholder value. We are debt-free right now and do not pay retail rent, so we should be able to build up significant savings for expansion and remain a company that is debt-free.
Because the founder already owns the building, there’s an average savings of $72,000 per year in rental fees. The seating capacity wastewater permit for the location is 91, which is a savings of $60,000 in permit fees. The overall cost to open is 75% below other brewing businesses as we have completed most of what we need to open the business.
Not only do we want to offer a place for brewers to experiment, but we also want to give back to those who sacrificed their lives. For our active, retired, honorably discharged and disabled veterans we offer a 10% discount on beverages and 15% on merchandise.
We will also open our tasting room to our community veteran groups who can host spaghetti dinners. We will donate a portion of the proceeds from beer sales during their dinner to support the services they offer for Veterans and their families.
In addition, the founder of the brewing company, Jonathan Mogor, also plans on supporting Veterans, families of fallen or injured military members, as well as Police and Fire Fighters who also suffered the same life-changing experience in the line of duty. More details will be revealed once we open, however, we can say that the program we are building will be supported from the beer sold in the name of Jonathan’s best friend, Scott McHugh, who was killed in Iraq. We will have an appreciation Irish Stout made in his honor and for all those who serve and served where we can support survivors of those who made the ultimate sacrifice or who have returned
home and need support.
We have a seating capacity for the building of 91 seats. The main tasting room can seat around 55 people and we have an overflow area we can accommodate more. Outside we also have enough seats for 40 people during the Spring, Summer and Fall before we have to close the outside due to winter. The building has street parking in front and a town parking lot on the opposite side of the building. There’s other overflow areas available in the evening and weekends when offices are vacant during those times.
A well-preserved 2-story clapboard commercial block with rectangular false front and Italianate style bracketed cornice, built c.1875 “to house the store of Heman H. Elmore, a dealer in “groceries, provisions, and flour.” Facade detail includes large and small cornice brackets, matchstick frieze, decorative eaves covers, four evenly-spaced two-over-two sash over the main southerly storefront, and paired two-over-two sash over a narrow secondary storefront to the north. Storefronts retain original form and bracketed cornice, but have otherwise been altered over the years. In the rear is a short wing, south ell, and triangular shed with sliding freight door set inside the ell. The building is one of the oldest and best-preserved of Portland Street’s commercial blocks, and its rectangular false front is one of six which gives the street its most distinctive architectural forms.
Soulmates don’t just have to be husband and wife, husband and husband or wife and wife. My best friend Scott R McHugh was my male soulmate. We met in High School when I moved from NJ to FL. There was only one open seat in the class when I arrived and it was next to Scott. As the teacher wrote my information down Scott introduced himself to me welcoming me to Florida. It felt as if we were twins born from the same mother. We both served in the US Navy after graduation at different duty stations and Scott stayed in the reserves after active duty. His reserve unit was sent to Iraq and ten days later we were notified he was killed along with other members in his unit. It was the largest casualty the US navy had since Vietnam. His unit was NMCB 14. Scott was a paramedic who loved his family, friends, animals and went into a career to help people.
Another gentile soul was Jeff Thorson who served in the US navy with me in Sardinia Italy. Jeff was a journalist on our ship who found himself years later with full army gear in action on patrols. Jeff, like Scott, stayed on in the reserves and was called to Afghanistan. Physically Jeff could handle the task but it took a toll on him emotionally. Ours was a friendship that lasted until Jeff had an allergic reaction between PTSD medication and an over the counter cold medicine.
My tribute to my brothers who are gone but never forgotten is to help Veterans who are injured, families who lost a service member in action or to PTSD, Police officers and firefighters who were injured or the families of these brave men and women who didn’t come home at the end of a shift. We have proceeds from our patriot tribute line of drinks and clothing going to support these wonderful people and their loved ones.
We mentioned pets. In addition to our love for each other we absolutely love animals, rescue animals and the people who rescue, foster, and adopt rescue animals. Soulmate brewing supports animal rescues. Proceeds from our pet-themed beer line help with the costs associated with rescuing animals from kill shelters. This includes medication, vet bills, food, and transportation.
Soulmate Brewing Company has financial statements ending December 31 2019. Our cash in hand is $75,000, as of March 2020. Over the three months prior, revenues averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $0/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.
We have a team of brewers who develop and produce high quality beer with some of the beer being entered in competition and winning awards in New England for best amateur beer in a number of categories. One of the brewers currently works for a well established brewery and the other two have decades of experience with beer, cider and distilling.
We see the company in five years with distribution throughout Vermont with a solid footprint in New England, Upstate NY and Canada. As sales supports growth we envision Soulmate Brewing Company tasting rooms outside of our immediate area. Increasing our customer base and allowing us to produce our product in our new distribution areas so we can maintain our quality control standards that our customers will be accustom to enjoying when they fill their mug with any of our offerings.
Given the Company’s limited operating history, the Company cannot reliably estimate how much revenue it will receive in the future, if any.
Soulmate Brewing LLC was organized in the State of Vermont in July 2019. In April 2020, Soulmate Brewing Company converted to a C-Corporation.
Since then, we have:
Historical Results of Operations
Our company was organized in July 2019 and has limited operations upon which prospective investors may base an evaluation of its performance.
Liquidity & Capital Resources
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. 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
Soulmate Brewing Company cash on hand is $75,000, as of March 2020. Over the last three months, revenues have averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $0/month, for an average burn rate of $0 per month. Our intent is to be profitable in 12 months.
There have been no material changes since the date that our financials cover.
Once we open we hope to have a steady flow of visitors to the brewery from people who travel to Vermont on a regular basis. Our brewers are all local Vermont residents with roots that run deep between family and friends who know the quality of their beer. As we increase production our utilities will increase which is a byproduct of increased sales. Our expenses are very low. The founder of Soulmate Brewing Company owns the building so we do not have the typical rents associated with most businesses. We are also debt free and have very low living expenses which are covered by co-founder Carol's work as an Occupational Therapist and our savings, which can be used for additional capital if necessary.
We expect to need a minimum of $75,000 to begin operations and start generating revenues. Six months after that, we hope (but not guarantee) to be generating approximately $36,000 in monthly revenues and $19,000 in monthly expenses.
There is a risk we outgrow our brewing capacity. However, we have plenty of space to add additional equipment to handle growth. We have the ability to raise the roof when the time comes to increase capacity even more. We have contract brewing options in the event we have to expand so we can continue to meet demand and we would be able to keep the tasting room open during any expansion as the brewing equipment is in a separate part of the building.
A break in our supply line of ingredients could potentially force us to halt production of a specific beer. We would seek alternative options to solve any disruption. Our brand offerings are very diversified so an interruption from one source would not take the company off course.
Cost of raw materials or utilities go up. The nature of our product does take some things out of our control. The product costs as we scale up production decrease so we would be able to factor into overall production a fluctuation of these variables. Also please keep in mind the founders of Soulmate Brewing own the building so there's no cash cost for the leased space to Soulmate Brewing which provides a significant cushion for operating costs in the event we see a spike in utilities or raw materials
Winter storms prevent us from opening. It has happened in Vermont where the roads are not safe to drive on. It is part of life in New England. We might find a few days where we are closed due to Mother Nature. It will not hurt production. The towns are very efficient in clearing snow and making the roads safe to navigate. In many cases it is waiting for the plow at home to clear the driveway that takes the most time to get done. Safety of our staff and customers is our top priority so if we miss a few sales once in a while for snow and icy conditions we will return the next day and get back to it.
Damage to the building or equipment. If this were to happen we would call our insurance company and file a claim. The policy for this kind of business covers loss of use for the property and loss of product. Depending on the type of damage we could be without our primary home until we were able to recover. We would seek a temporary option for the tasting room and utilize contract brewing to keep our supply line moving forward.
The recent outbreak of COVID-19 could delay our plans to open and generate revenues for an indefinite amount of time. Also, after shelter in place regulations are lifted, the demand of customer to meet in establishments like restaurants in breweries could diminish.
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. However, In the craft brewing industry there are many talented brewers waiting for the opportunity to become the lead brewer. Brewing beer while an art, once the recipe is developed anyone can follow it step by step so we would not find our company in a position that would leave us compromised.
Carol Mogor is a part-time officer. As such, it is likely that the company will not make the same progress as it would if that were not the case.
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