August once again proved to be a very fruitful month for Recoup. We did $215,000 bringing our year to date to $1.55m. We are still growing at 11.6x for YOY growth. Additionally, we finally have all three new hires onboarded. They have been great additions to the team and everything is coming together. We are very excited about the upcoming months as we are only one month away from entering our official holiday season.
Manufacturing & Ops
As many of you know the tariff war has escalated. We are lucky enough to not be affected by the tariff until Dec.15th. The tariff will increase our goods by 15%. We are working hard with our factory to take on 50% of the burden and we will absorb the other 50%. It is our job to figure out workarounds so as not to impact customers during the holiday season this year. Natalie has diligently been looking at sourcing our products in Mexico. We still need help with this. If anyone has contacts in Mexico for sourcing and manufacturing please pass them along. In the same breathe, we are looking for different alternatives to China in Southeast Asia. We are too close to holiday to change manufacturing, sourcing will be our top priority in 2020. Our goal for 2020 is to set up 50% of manufacturing in Mexico or other places to protect ourselves and diversify for the sake of safety and speed.
Our board has been a huge help in establishing banking relationships. We know this will take time, but a solid banking relationship will help the future growth of Recoup. This needed banking assistance will provide the cash needed to grow until we are acquired with the goal of Series A being our last raise. Our banking partner will be InBank. They are a more entrepreneurial bank than most. Most banks claim this, but in reality, they are not. We vetted numerous banking partners over the course of several months during this process. InBank is more willing than others to help as they see the potential of Recoup. We will be fully transferred over to InBank at the conclusion of our bridge round.
Capital Raise
The bridge round is full. We have commitments for $500,000. We are going to over-raise from primarily our previous investors and one possible investor that could become the new face of Recoup. This tier 1 athlete has seen the deal and I have a meeting with him during the week of the 23rd. Once the deal is signed, we will release his name. We can say that he is a big name that can help us get funds from other athletes during Series A. If this athlete does come in our bridge round we will be at $575,000. We will not over-raise by more than $100,000. If you do want to come in during the bridge round, please let me know ASAP as the official close date is the 27th. This is a hard close date with our holiday starting season starting 4 days after.
Product Development
We were faced with a really difficult decision as it pertains to product development. We decided to push the Thermosleeve launch until Jan 2020. The Thermosleeve is a game changing product that has never been seen before. The launch needs to be treated as such. With our current timeline, there is no way we could launch the Thermosleeve the correct way. We want to make sure that everything is fully buttoned up as it pertains to the product itself, branding, legal, marketing, and a complete launch strategy. That being said, we are doubling down on the Cryosleeve for the remainder of 2019. We have received high demand and great feedback with the product so far and do not want to slow momentum by selling out of inventory during holiday. By not launching the Thermosleeve we are able to get the Cryosleeve on Amazon before holiday with the increased inventory level. Since we have a brand registry with Amazon, the Cryosleeve will already have a high ranking and those who purchase a sphere will be suggested to purchase the sleeve. Another factor in our decision was looking at the data. Glenna found a telling data point, proving the demand for the Sleeve is there. People searched for the Cryosleeve on Amazon at the same volume as the sphere. The final factor for pushing back the Thermosleeve was Series A was investor feedback. They said it would be more impressive that we successfully launch a second product, show high demand and can handle inventory on the backend for multiple SKUs, thus proving ourselves in the wearable market. Everything we are learning with the production of the Cryosleeve will transfer to make the Thermosleeve even more smooth. As bad as we wanted to launch the Thermosleeve, holding off is the best option. Beyond allowing us more time to have a successful launch, a launch in Q1 of 2020 will help us start the year strong with a huge influx of revenue after holiday. This will help even out our revenue over the course of the year.
Thank you to all of our investors! If you have questions or would like more details on any of these updates please feel free to reach out directly.