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Enertor

Platform:
Crowdcube
Stage:
Expansion
Industry:
Retail
Location:
UK - East
Date Rated:
10/08/17
Raise:
£750,000
Equity:
6.98%
Valuation (Pre Money):
£9,994,986
Industry: Retail
Location: UK - East
Platform: Crowdcube
£750,000 Expansion
Valuation: £10,744,986
Date Rated: 07/08/17

MANAGEMENT

PRODUCT

INVESTMENT
Tax Status: EIS

Business Summary

Enertor is an insole with patented D3O technology providing users injury protection, pain-relief and increased comfort and performance. Enertor was launched in almost 500 stores in the UK and has secured a 10-year exclusive endorsement agreement with Usain Bolt. This round of investment will be mainly used to fund the acquisition of stock and to support the marketing activity.

Financial Overview

Dec-21
Date (y/e) Dec-17 Dec-18 Dec-19 Dec-20 Dec-21
Sales Dec-17£2,151,035 Dec-18£4,250,461 Dec-19£7,953,289 Dec-20£14,157,395 Dec-21£23,760,517
Gross Profit Dec-17£1,245,740 Dec-18£2,732,216 Dec-19£5,363,283 Dec-20£9,697,986 Dec-21£16,368,911
GP as % sales Dec-1758% Dec-1864% Dec-1967% Dec-2069% Dec-2169%
Overheads Dec-17£2,280,505 Dec-18£2,829,968 Dec-19£4,158,841 Dec-20£6,660,756 Dec-21£11,183,782
Operating Profit Dec-17-£1,034,765 Dec-18-£97,752 Dec-19£1,204,442 Dec-20£3,037,230 Dec-21£5,185,129
OP as % sales Dec-17-48% Dec-18-2% Dec-1915% Dec-2021% Dec-2122%
Closing Cash Dec-17- Dec-18- Dec-19- Dec-20- -

Note: This financial information has been sourced from the company on 07/08/2017. Financial data is NOT verified by Wheatfromchaff Ltd.
85%
SKILLS:
EXPERIENCE:
COMMITMENT:
The management team has demonstrated competence to date in building a product and generating brand awareness and all the key roles are covered with the required skills.
The industry is well known by the product developers and the management team has strong start-up and commercial experience and the further support of a marketing advisor.
The Founders, friends and family have invested over £2m into the business and a 7% share option pool has been established to retain and attract more talent.
79%
MARKET:
PRODUCT:
COMPETITION:
The foot orthotics segment is worth over £2.2bn globally with an estimated market penetration of just about 5% and the company is increasing its international presence.
Given the large number of ambassadors and the Usain Bolt support, the product has achieved brand awareness and initial commercial traction rapidly and other products are also in development.
The company has exclusivity using the D3O material for the next year and it could be extended for another five years and they also have a ten-year Ambassador agreement with Usain Bolt.
62%
PROFITABILITY:
CASHFLOW:
RETURNS:
A strong pipeline with retailers in over 10 markets and a clear expansion plan makes sales projections look reasonable and local partners will provide further marketing support.
There is insufficient information available to fairly rate this aspect of the business
Given its qualities and projected growth, Enertor could be able to attract a strong sales multiple upon exit and if the plan is delivered, investors could expect at least a five-fold return.


Conclusion

The team has demonstrated that they can secure distribution deals with retailers in different countries and the product is already listed in 10 markets with expectations to be in over 20 by the end of the summer with confirmed purchase orders.

It would be re-assuring to have a more detailed breakdown of overheads as they could easily ramp up given the need for marketing funds and set-up costs in new markets, and this could lower the company's profit margins.

Investors should also note that the company's competitive advantage is currently based on their exclusive license to D3O technology and once these underlying patents have expired in 2022 this could leave the company exposed to competitors accessing similar technology elsewhere, without further R&D on their part.

Related Links

Crowdcube Pitch

www.enertor.com

 

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The Ratings we publish have been approved and issued at Financial Promotions in the United Kingdom by Wheatfromchaff in the United Kingdom who is Authorised and Regulated by the Financial Conduct Authority FRN: 751017. Wheatfromchaff Limited registered office is Kilver Court, Kilver Street, Shepton Mallet, Somerset, BA4 5NF and telephone number +44 (0) 1749 347 577. Telephone calls may be recorded. VAT No: 214 0196 49

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