|1||Cool, on-demand personal vehicles take you safely and directly to your stop with zero emissions|
|2||Disruptive innovation for $600 billion transit market|
|3||Great team - CEO led a public company that completed 50,000 projects in over 100 countries|
|4||Key stakeholder support for multiple potential projects|
|5||Partnered with a well-established national transportation practice & have the support of a Top 10 engineering university|
|6||We've spoken to hundreds of transportation professionals and they love our concept|
|7||Our vehicles enable social distancing - current transit has a huge COVID-19 problem|
|8||We have extensive experience selling and delivering solutions globally on multi-billion-dollar projects|
When first hearing about Swift Rails I immediately wanted to be involved because I've seen a dire need for this solution first-hand. It fills a big gap in the US and Europe, but there is also a desperate need in other countries. Having lived in crowded cities in Latin America, Asia and traveled extensively, I have seen the chaos that is transportation in many developing countries. Transportation based soley on roads does not work for heavily populated areas, and a lot of these countries can only afford roads. In many of these places it can take a couple hours to travel a few miles on hectic roads overflowing with all kinds of vehicles, most barely moving. Currently there is no solution I see like Swift Rails. In a world where affordable, green technology solutions are in short supply to tackle the infrastructure needs of the world, I feel the Swift Rails team will be able to build, scale, and thrive to meet these growing demands. I think there is enormous upside potential for this investment.
Swift Rails is a new type of on-demand transit that is 5x faster and 40x cheaper than conventional light-rail.
Swift Rails uses autonomous 1-4 person vehicles traveling rapidly on a highway of ultra-light rails. Vehicles are hailed by app and deliver passengers directly to their destination with zero emissions. The rails are elevated 12-15 ft. above the traffic (and pedestrians, animals, wet roads and snow) using a pole similar in size to a light post and they install quickly and easily almost anywhere.
Ten Years Ago Our CEO Gave a Speech at the UN...
Our CEO presented to world leaders at a conference on Climate Change. His description of what an ideal form of transportation would look like evoked such an impassioned response from those leaders that it ended up changing his life.
From That Concept We Developed Something Truly Exceptional...
How Swift Rails works.
We Make Installing Transit Easy by Radically Changing the Cost Equation
Our low cost, quick installation and tiny footprint completely changes how transit can be applied by eliminating the biggest hurdles to implementation. In many cases, we can build a system for the time and cost of studying conventional transit projects.
Current Transportation - Unsustainable and Also a Huge Market Opportunity
The transportation market is enormous, $4.8 trillion globally, and facing increasingly problematic issues. In 1900 there were just 8,000 automobiles and 10 miles of paved road in the U.S! In 2016 there were 1.3 billion cars on roads worldwide, and they continue to double every 20 years – we are running out of space to build new roads where they are needed.
The limitations of the automobile-based system are clear:
• 8.8 billion hours (1 million years!) wasted in traffic jams annually in the U.S. alone
• World's single largest source of carbon – 5.8 gigatons annually
• Autos are dangerous - #1 cause of death globally for 5 to 29 year olds
In short, it makes no sense to move around 200lb people using 4,000lb vehicles on rubber tires rolling over asphalt roads.
Public Transit Is Supposed to Be the Solution but It's Not Working for Most Places
Mass transit is prohibitively expensive and incredibly hard to put in place:
• Typically multi-billion dollar projects requiring huge taxpayer subsidies
• Take 10+ years to build and construction is highly disruptive to the community
• Crucial political support can be hard to secure
Even when transit is available, most people prefer to use their own car due to the hassle:
• Inconvenient and inflexible schedules with long travel times
• Crowded carriages - difficult to find seating, uncomfortable, germs and diseases
• You never know who you’re riding with
Swift Rails Is a Much Better Solution for Social Distancing Than Current Transit
Crowded transit is now perceived as unsafe as it is uncomfortable – long lasting impact on passenger behavior is an industry concern.
And We Offer a Really Comfortable Way to Get Around
• Hail on demand, your schedule is our schedule
• Travel in privacy in a first-class climate controlled seat
• Travel direct to your stop, no stopping at other people’s stops
• No creeps or obnoxious people to deal with
Better than a car - no traffic, stop signs, lights or idiot/drunk drivers to deal with.
People Who See Our Vehicle Love Our Concept
Just about anyone who sees our vehicle in person immediately “gets it”. We’ve had over 1,000 people sit in the vehicle and responses have been overwhelmingly positive. They all want Swift Rails in their hometown, and many are bursting with ideas of other places where it would be great.
We’re Positioned to Win in a Massive Untapped Market
Due to prohibitive cost, less than 5% of suitable cities have transit – we can change that!
The above addressable market represents the opportunity of putting Swift Rails in 4,000 small cities and augmenting existing systems in 200 large cities.
Track to Commercialization
*projects we believe have a fairly high degree of confidence will happen, but there is no guarantee they will
Clarkson University supports Swift Rails showcase demonstration project on their campus.
Almost Endless Room for Expansion
Swift Rails is lower cost than conventional transit and elevated roads from day one. As we get to scale we expect to be a cheaper to install than a new surface road. Building a road cost about $1 million per lane-mile, but that doesn’t include many costs:
• The cost of the autos – ownership, insurance, wear and tear, depreciation
• Annual road maintenance of $50,000/lane mile
• Cost of parking spots at businesses, stores, homes, schools, road-side, etc. This is a massive hidden cost. An estimated $725 billion is spent annually on parking in the U.S. alone, more than three times total expenditures on public roads. For each dollar motorists spend directly on their car somebody bears more than 50¢ in parking costs.
• The high costs relating to loss of lives, injuries and property damage
Each year there are:
• 24 trillion passenger miles traveled
• 5 trillion passenger trips
We expect to capture a significant portion of this market:
This Is the Perfect Time to Invest in Swift Rails
Once we prove engineering at scale with Clarkson University Swift Rails will be the first passenger carrying operational system of its kind and positioned for rapid expansion.
• Ride hailing adoption over vehicle ownership (Uber, Lyft)
• Traffic congestion is becoming unbearable
• Willingness to accept new solutions (scooters, autonomous vehicles)
High Level of Disruption in Transportation
• Climate change awareness is driving megatrend changes
• Substantial shifts to electric vehicles
• Movement to service models over vehicle ownership
Recent Advances in Technology
• Autonomous vehicles
• Electric and hybrid technologies
• Low-volume manufacturing
Some of Our Progress to Date
Built test track and full-scale vehicle prototype – 1,000+ rider touch tests
Surveyed riders’ willingness to use /pay and received a hugely positive response
Secured Letter of Intent from the President of Clarkson University to build our Showcase Demonstration Project on their campus
Regional transit agency and key stakeholder support for Niagara Falls, NY project
Developed partnerships that deeply enhance key capabilities:
Milestones and Funding
We are seeking funding to prove our engineering at scale and
accelerate business development
Your Investment Will Introduce Transportation That Changes the World
Solving Climate Change
• 2.4 gigatons of annual carbon reduction projected by 2040*
Making Transportation Safer
• Estimated 10 million annual traffic injuries avoided by 2040*
• Reduce air pollution, congestion and stress
• Make travel fun again
• Free up green space and make cities more livable
Making a Great Return
• Things that transform the world have great returns on investment
We will work incredibly hard to make your return worthwhile
* please see our Impact Report at https://www.swiftrails.com/world-changing-impact/ for more detail
Swift Rails, Inc. has financial statements ending December 31 2019. Our cash in hand is $21,055, as of August 2020. Over the three months prior, revenues averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $3,258/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 cool new kind of transportation. Super efficient 1 to 4 person autonomous vehicles powered by electric motors using renewable energy that travel rapidly on a highway of ultra-light rails elevated 12-15 feet by a small pole similar to a light post. Vehicles are hailed on-demand like an Uber and quickly take you directly to your destination with no stops in between. Radically cheaper and better than regular transit, our system is the solution to clean, sustainable ground transportation.
In five years, we hope to have two fully operational systems, revenue of approximately $60M, and $600M - $1 billion of projects in development. We aim to have our model be proven and that we’ll be poised for rapid global expansion. Ultimately, we intend to replace 25% of automobile traffic globally. By 2040, our goal is to reduce carbon emissions by 2.4 billion tons annually and avoid 10 million annual traffic related injuries. We hope annual recurring revenue in excess of $100 billion. These projections cannot be guaranteed.
Given the Company’s limited operating history, the Company cannot reliably estimate how much revenue it will receive in the future, if any.
Swift Rails, Inc. was incorporated in the State of Delaware in September 2019.
We have gotten significant traction in the last two years, primarily in the last year:
- Built a full-scale vehicle prototype
- We’ve had over 1,000 people sit in the vehicle and performed surveys with overwhelmingly positive results
- Have regional metropolitan transportation authority (MPO) and key stakeholder support for a potential public system project
- Letter of support from Clarkson University to build a showcase demonstration project on their campus
- Developed partnerships that deeply enhance key capabilities
- Added a highly experienced transportation executive to our team
All of this traction is what compelled us to raise capital now, which is why we chose to form a Delaware C-Corp in September 2019. To date, we have essentially been self-funded, but we now require outside funding to pursue the exciting opportunities in front of us.
Historical Results of Operations
Our company was organized in September 2019 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 $178,800 in equity.
After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 12 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 3 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
Swift Rails, Inc. cash in hand is $21,055, as of August 2020. Over the last three months, revenues have averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $3,258/month, with fixed expenses averaging less than $1,200/month.
It is difficult to predict when we will be profitable because we’re a bit different than a typical retail-type company. Our revenue can come in large pieces with even small projects reaching tens of millions in revenue. We do have a few projects in the pipeline and it is possible we could reach profitability on a single project. If we raise our minimum target of $50,000 it is difficult to say with certainty when we would need to raise more capital. We do have some pending grants and proposals which have the potential to change things significantly, but if no new capital came in we’d likely need to raise more capital within 12 months. It is difficult to say how much time and capital will be needed to reach a revenue-generating point, but it is possible we could begin to generate revenue in 12-18 months. Our fixed expenses are very low which gives us a great deal of flexibility to keep things operating. In addition, we could raise more capital and pursue various grants and proposals, for which there are many we believe we are well suited. It is very difficult to forecast our monthly revenues and expenses 6 months after reaching a revenue-generating point, because our revenue streams and project sizes will be very large and lumpy, so the project pipeline will largely determine what those forecasts would look like. We envision that a transaction where a system is commissioned by an institution, property owner or public entity would involve initial funding for design and soft costs of between $50,000 and $1 million followed by construction fees ranging from $1 million to $250 million and then ongoing operating and maintenance fees ranging from $250,000 to $50 million annually. Because the company has not contracted for or built a full system yet, the foregoing is merely a model for how the payment structure might be arranged.
Given that we are a clean transportation company which enables more equitable access to resilient public transit and helps mitigate traffic congestion, there are a number of infrastructure, transportation and clean energy-type grant opportunities for which we believe we qualify, but nothing we can purely rely upon.
The Personalized Transit System has not been built. The System is the first of its kind.
The Personalized Transit System has been substantially designed by the Company. While a full-scale vehicle prototype has been built, there is no existing complete system or partial scale prototype system. Consequently, there is no guarantee that the Personalized Transit System will work as conceived or that any of the Company's projections will be achieved.
The Personalized Transit System involves implementation of multiple technologies, including software to run the system and a cell phone app.
The implementation of the Personalized Transit System included integration with operational software and will eventually include cell phone apps that enable customers to hail vehicles. The general logic, features and required capabilities of this cell phone app and how it will integrate with the overall vehicle management system has been well thought out. The Company will begin the development of the app software with a portion of the proceeds from this offering. The Company will use a combination of internal and external resources in developing these systems.
We are an early stage company with no historical performance.
We are a development stage company. We have not generated any revenue to date. Any and all statements about future operational and financial performance are forward looking statements. Actual results may vary materially from these statements.
We will require additional financing.
Our best estimate is that if the maximum offering amount is met the Company will require additional operating capital within 18 months. There is no assurance that the Company will be able to obtain such additional financing or that it can be obtained upon terms that are acceptable to our shareholders. Our projects are capital intensive. We may finance each transportation system individually using a combination of public and private funding. In some cases, the Company will form special purpose subsidiaries to own and operate a project. The Company may not own 100% of these subsidiaries and may not control these subsidiaries. Additional financing will dilute your share of the Company's equity. . If we cannot secure sufficient additional financing, we may be forced to forego strategic opportunities or delay, scale back or eliminate further development of our goals and objectives, operations and investments
The Company relies on its intellectual property which may not be adequate and may be difficult to protect.
The Company’s Personalized Transit System was developed by Swift Rails, LLC, a predecessor entity to the Company under common control with the Company. The Company believes that all of the intellectual property comprising the Personalized Transit System will be owned or controlled by the Company or otherwise legally available to the Company, but there is no assurance that challenges to the Company’s rights may not emerge. The Company has applied for certain patents related to the System. A non-provisional patent covering the general system design and switching mechanisms was filed in October 2017 (“Intelligent Transportation System and Method”, 101950-1-PCT), and an international application was filed in October 2018 (PCT/US18/57506).
Our intellectual property rights may not be sufficiently broad or otherwise may not provide us a significant competitive advantage. In addition, the steps that we have taken to maintain and protect our intellectual property may not prevent it from being challenged, invalidated, circumvented or designed-around, particularly in countries where intellectual property rights are not highly developed or protected. In some circumstances, enforcement may not be available to us because an infringer has a dominant intellectual property position or for other business reasons. Any failure by the Company to obtain or maintain intellectual property rights that convey competitive advantage, adequately protect our intellectual property or detect or prevent circumvention or unauthorized use of such property, could adversely impact our competitive position and results of operations. We also rely on nondisclosure and noncompetition agreements with vendors, consultants and other parties to protect, in part, trade secrets and other proprietary rights. There can be no assurance that these agreements will adequately protect our trade secrets and other proprietary rights and will not be breached, that we will have adequate remedies for any breach, that others will not independently develop substantially equivalent proprietary information or that third parties will not otherwise gain access to our trade secrets or other proprietary rights. As we expand our business, protecting our intellectual property will become increasingly important. The protective steps we have taken may be inadequate to deter our competitors from using our proprietary information. In order to protect or enforce our intellectual property rights, we may be required to initiate litigation against third parties, such as infringement lawsuits. Also, these third parties may assert claims against us with or without provocation. These lawsuits could be expensive, take significant time and could divert management’s attention from other business concerns. The law relating to the scope and validity of claims in the technology field in which we operate is still evolving and, consequently, intellectual property positions in our industry are generally uncertain. We cannot assure you that we will prevail in any of these potential suits or that the damages or other remedies awarded, if any, would be commercially valuable.
We do not expect to pay dividends in the future. Any return on investment may be limited to the value of our common stock.
We have never paid cash dividends on our common stock and do not anticipate doing so in the foreseeable future. The payment of dividends on our common stock will depend on earnings, financial condition and other business and economic factors affecting us at such time as our board of directors may consider relevant.
The Company’s limited operating history makes the Company’s business difficult to evaluate.
The Company was formed on September 18, 2019. Therefore, its prospects must be considered in light of the risks and uncertainties encountered by companies in an early stage of development in a competitive market. The Company has a history of operating losses, expects to continue to incur net losses in the immediate future, and may not achieve or maintain profitability for some time or at all. There can be no assurance that the Company will successfully implement its business, which could have a material adverse effect on its business. The Company cannot guarantee that it will achieve its stated business objectives or achieve positive or competitive results from its operations.
The Company’s success depends on the experience and skill of the Board of Directors, the management team, its executive officers and key employees.
As of the date hereof, the Company does not have employment agreements with its personnel. The Company is moving quickly to put employment agreements in place with its key executives. In addition, the Company will implement confidentiality agreements with all key employees. The expected compensation ranges for senior employees of the Company will be substantially below their earning power in the market. This differential will be offset by stock option compensation. As the Company grows, a corporate body of knowledge will be produced and taught to other employees in order to facilitate growth. As this happens, any change in management’s ability to operate the business due to disability, illness, or for any other reason, would cause a significant loss in production capability, which would have a material adverse effect on the Company’s business and prospects.
General economic conditions and volatility due to the Coronavirus in the worldwide economy has adversely affected consumer spending in certain sectors, which may negatively affect the Company.
The Company’s performance will depend significantly on economic conditions, particularly those in the United States. Spending on capital investments is affected by a number of factors, including consumer confidence in the strength of economies, fears of recession, the tightening of credit markets, higher levels of unemployment, higher tax rates, the cost of credit and other factors. These unfavorable economic conditions may cause public and private entities do reduce or eliminate infrastructure spending.
Issues related to Permitting and Rights-of-Way could significantly affect our projects.
Permitting and right-of-way access in the case of each project will vary significantly and may be implemented differently in different jurisdictions. The Personalized Transit System is expected to require easement rights (or similar rights depending on the jurisdiction) for the erection of its poles and track. The Company may seek additional property rights, which may include fee title, for its stations. The acquisition of these rights may entail securing property rights or easements from each property owner whose property will have poles or rails traversing their property. In some cases the Company may require municipal approvals. As the Company wins contracts to build and install the Personalized Transit System, the Company will evaluate each project's legal requirements and will determine how they can be met on a case-by-case basis.
Our securities will not be freely tradable until one year from the initial purchase date. Although our securities may be tradable under federal securities law, state securities regulations may apply, and each purchaser should consult with his or her attorney.
You should be aware of the long-term nature of this investment. There is not now and likely will not be a public market for our securities. Because our securities have not been registered under the Securities Act or under the securities laws of any state or non-United States jurisdiction, our securities have transfer restrictions and cannot be resold in the United States except pursuant to Rule 501 of Regulation CF. It is not currently contemplated that registration under the Securities Act or other securities laws will be effected. Limitations on the transfer of our securities may also adversely affect the price that you might be able to obtain for our securities in a private sale. Purchasers should be aware of the long-term nature of their investment in the Company. Each Purchaser in this Offering will be required to represent that it is purchasing the Shares for its own account, for investment purposes and not with a view to resale or distribution thereof.
Neither the Offering nor the Securities have been registered under federal or state securities laws, leading to an absence of certain regulation applicable to us.
No governmental agency has reviewed or passed upon this Offering, our company or any Securities of our company. We also have relied on exemptions from securities registration requirements under applicable state securities laws. Investors, therefore, will not receive any of the benefits that such registration would otherwise provide. Prospective investors must therefore assess the adequacy of disclosure and the fairness of the terms of this Offering on their own or in conjunction with their personal advisors.
There is no guarantee that a purchaser of our securities will ever realize a return on his/her/its investment.
There is no assurance that a purchaser will realize a return on its investment or that it will not lose its entire investment. For this reason, each purchaser should read the Form C and all Exhibits carefully and should consult with his/her/its own attorney and business advisor prior to making any investment decision.
In addition to the risks listed above, businesses are often subject to risks not foreseen or fully appreciated by the management. It is not possible to foresee all risks that may affect us. Moreover, we cannot predict whether we will successfully effectuate our current business plan. Each prospective Purchaser is encouraged to carefully analyze the risks and merits of an investment in the Shares and should take into consideration when making such analysis, among other, the Risk Factors discussed above.
The spread of COVID-19 has severely impacted many local economies around the globe. In many countries, businesses are being forced to cease or limit operations for long or indefinite periods of time. Measures taken to contain the spread of the virus, including travel bans, quarantines, social distancing, and closures of non-essential services have triggered significant disruptions to businesses worldwide, resulting in an economic slowdown. Global stock markets have also experienced great volatility and a significant weakening. Governments and central banks have responded with monetary and fiscal interventions to stabilize economic conditions.
The duration and impact of the COVID-19 pandemic, as well as the effectiveness of government and central bank responses remains unclear currently. It is not possible to reliably estimate the duration and severity of these consequences, as well as their impact on the financial position and results of the Company for future periods.
James Enright 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.
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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