I want to first apologize for not getting out an investor update last month. Things are still growing fast with Recoup and we have some great updates.
We officially broke the $1m benchmark at the end of June! At the end of July, our revenue reached $1.29m.
Our current YOY growth is 11x from 2018 to 2019. This number will drop down to 6x by the end of the year. This is because we drove about $600k of our $827,000 revenue in November and December. We know this raised concern to investors, driving 73% of our revenue during two holiday months. This year we have proved that it was not a flash in the pan as we have beaten 2018 revenue by $463,000 in 7 months. This year our split will be 40% in Q1-Q3 and 60% in Q4. The number one focus in 2020 is driving at least 50% of our revenue in Q1-Q3 and 50% during Q4 to even out our yearly revenue split and balance out cash flow. To know more about our plan to achieve this, please reach out to me directly, firstname.lastname@example.org.
During our growth, all four of us have maxed out on the human capital side of things. We saw this coming in May. Since May, Natalie has been focused on our future hires. All four of us looked at what items took up the most time, not allowing us to focus on our strengths. Once we figured out this equation, Natalie developed job descriptions and found the correct people for the jobs. She ran our new employees through multiple projects, making sure they can keep up with our fast pace, enjoyed working for us and are an overall fit with our culture and grand vision for the company. Our three new hires are as follows:
Tanner Dunn will be doing all of our creative. Since B2C drives the majority of our revenue, we needed to get Glenna help. Glenna was spending 70% of her time creating content, editing content for ads, organic curation, and social posting and engagement. This took away from her strength of digital strategy. With her time back, she can focus more on paid and organic strategies. Marketing is one of our highest spends. With Tanner on the team, Glenna can focus on driving more revenue while lowering marketing spend through organic marketing and other strategies.
Elyse Caldwell will be doing a hybrid role in logistics and sales. She is going to help Chelsea drive our B2B sales. Chelsea has been doing all the dirty work of opening up doors. She finished out our Jack Rabbit expansion nationwide, opening up doors to a possible 2100 retail locations with CryoUSA, Fysical and Epic RX. Chelsea has focused her sales strategy to grow each one of these channels, to fully execute on the huge opportunity. As this is a daunting task one person could not do alone. Elyse will be helping Chelsea get our product into these doors and increasing reorder rates and increasing order quantities. Elyse will be helping Natalie on the logistic side as well. Inventory is our biggest cash spend. With Elyse and Natalie fine-tuning logistics, Recoup can better forecast inventory and spends through the year, easing the inventory cash burden we have. She also has extensive experience in product development, sourcing, and manufacturing set up which will help us eventually bring most of these things completely in-house to save funds and decrease the amount of outsourcing.
Karissa Layden will come on to work a variety of facets of the business including events, customer service, account management, and brand partnerships. Events drive revenue during the event as well after the event opening up more doors to distributors and retailers. With the launch of the sleeve and holiday coming up, we know customer service will pick up and we will need someone to be keeping in touch constantly with customers and upholding brand trust. When Elyse and Chelsea need help on the account management side, Karissa will be there to help them. She is also going to be tackling brand partnerships, which is a huge part of the marketing strategy we haven’t had the bandwidth to touch yet. This includes partnerships with other companies, athletes, and influencers to help with our overall brand presence. The sleeve's partnership with BOA is proving to be a great move for brand and revenue. Because of this success Recoup plans on partnering with other powerhouse brands to keep growing revenue and brand awareness.
New Product Development
The Cryosleeve will officially be for sale on Monday, Aug 12th. Our presale went really well, but soon realized we needed to dial back the demand for the Cryosleeve. We currently have 10 SKU’s of the Cryosleeve. This can turn into a huge problem and was addressed right away. We are going to be releasing version 1.5 in October. Cryosleeve 1.5 will drop our sizing SKU’s from 10 to 5. We are adding a stretch zone, giving the capabilities to combine sizes. The only design change is a stretch zone, fitting more people. Consumers will not notice much the design change, but we notice a difference on the Recoup backend with inventory control.
Recoup will be introducing the Thermosleeve on Nov 1st. Through our manufacturing, we were able to use our manufactures approval codes for heating and batteries as they already ship within the United States. Due to this strategic play, we gained three months back. Gaining this time back makes it possible to release the Thermosleeve during the holiday.
Because of Recoup’s growth and ability to launch two new products we are doing a bridge round. We are raising $500k-$1m at an $8m pre-money evaluation. We already have a lead investor in the round. On Thursday, Aug 8th we will be doing a deep dive into the round, which will have a hard close on Aug 31st. If you’re interested please sign up at the link below. If you cannot make it, but still want to join, we will have a zoom conference of the Deep Dive. If you’re interested in the round please feel free to reach out directly to me as well.
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