Need some help? Close Help

nHouse

Platform:
Crowdcube
Stage:
Seed
Industry:
Manufacturing
Location:
UK - London
Date Rated:
27/07/17
Raise:
£495,000
Equity:
9.91%
Valuation (Pre Money):
£4,499,955
Industry: Manufacturing
Location: UK - London
Platform: Crowdcube
£495,000 Seed
Valuation: £4,994,955
Date Rated: 25/07/17

MANAGEMENT

PRODUCT

INVESTMENT
Tax Status: SEIS & EIS

Business Summary

nHouse has designed a modular pre-fabricated home that could be mass produced and shipped for rapid assembly. These funds will be used to build the demonstration home, which will be used to secure initial sales.

Financial Overview

Date (y/e) Dec-17 Dec-18 Dec-19 Dec-20
Sales Dec-17- Dec-18£20,125,000 Dec-19£41,639,800 Dec-20£54,054,600
Gross Profit Dec-17-£265,000 Dec-18£4,663,000 Dec-19£9,503,470 Dec-20£12,591,590
GP as % sales Dec-170% Dec-1823% Dec-1923% Dec-2023%
Overheads Dec-17£187,101 Dec-18£730,114 Dec-19£979,672 Dec-20£1,064,772
Operating Profit Dec-17-£452,101 Dec-18£3,932,886 Dec-19£8,523,798 Dec-20£11,526,818
OP as % sales Dec-170% Dec-1820% Dec-1920% Dec-2021%
Closing Cash Dec-17£97,909 Dec-18£3,947,782 Dec-19£11,660,002 Dec-20-

Note: This financial information has been sourced from the company on 24/07/2017 or from public sources. Financial data is NOT verified by Wheatfromchaff Ltd.
87%
SKILLS:
EXPERIENCE:
COMMITMENT:
The nHouse team covers all the key roles and the team members have a track record of building and growing companies.
The team is very experienced and benefits from a very valuable technical advisor with many years of experience in the pre-fab construction sector.
Post funding the management team will all become full time, and the Founders have invested considerable funds already. We are curious as to why the FD isn't a board member.
53%
MARKET:
PRODUCT:
COMPETITION:
The UK housing market has a large and growing amount of unmet demand that pre-fab houses could help fill, but they are not yet a popular solution and there is some stigma to overcome.
The company has designed the nHouse and the soft launch has generated strong interest from industry commentators and potential partners. However the prototype has yet to be built.
Prefab solutions already exist at all strata in the market. nHouse compares well to similarly priced traditional homes in research, but faces more direct competition from other prefabs.
77%
PROFITABILITY:
CASHFLOW:
RETURNS:
The financial projections provided demonstrate a good awareness of the cost structure and the revenue mix. Annual growth targets are reasonable, though from a high initial base.
Significant working capital will be required, but with upfront payment this shouldn't be an issue. A number of financing options will be available to support delivery if necessary.
If the sales targets can be met then investors should stand a good chance of seeing high returns. Those investing above the £25,000 mark could lose any S/EIS benefits if they use their discount.


Conclusion

nHouse has an experienced team that has put together a high quality business proposal. Without a demo unit and confirmed sales there is a significant degree of execution and commercial risk, and the entry valuation is high. That said if the product meets expectations, potential demand for modern, green, hi-tech and low running cost homes is strong and investment returns could be substantial.

It is also worth remembering that the £195,000 cost of each house excludes certain further costs, most notably the cost of the plot of land on which the house would be assembled. Therefore the 'all in' cost of building an nHouse would be significantly higher than £195,000, and nHouse units resold by developers would need to be sold for ~£300k to meet their own margin requirements. This in effect leaves nHouse pricing on the premium side of 'average'.

We have some concern that a 5 month lead time on fabrication may be uncompetitive versus other modular housing providers, but in time and with investment in manufacturing partners and procurement chains this could be reduced.

Related Links

Crowdcube Pitch

www.the-nhouse.com

 

Right To Reply

Are you the entrepreneur? If you would like to publish a comment on our rating, please contact the ratings team.

Latest Forum Comments

Read All Comments

Disclaimer

The views and opinions expressed on this bulletin board are the sole property and responsibility of the author. Neither Crowdrating nor Wheatfromchaff Ltd, nor any of the directors or officers of Wheatfromchaff Ltd accept any responsibility or liability for them. Readers should be aware that comments do not constitute investment advice and may be inaccurate. Please seek to verify and take advice on all comments before relying on them in the context of any investment decisions you may make. if you wish to use the bulletin board please be aware you are accepting full responsibility and liability for what you write. Please look here for more specific rules we impose on people using our bulletin boards. We moderate all bulletin boards and we reserve the right not to publish your comments.

Disclaimer

Your capital is at risk when you invest in shares and debt securities. You can lose some or all of your money and may not be able to realise your investment. Therefore you should should never invest more than you can afford to lose. If in doubt about the suitability or tax implications of any investment, please seek independent financial advice. 

Information published on this website and any other reports or ratings published on CrowdRating.co.uk or by Wheatfromchaff Limited (trading as Wheatfromchaff) have been prepared by us in the United Kingdom for information purposes only. Wheatfromchaff Ltd is Authorised and Regulated by the Financial Conduct Authority FRN: 751017. 

No content on this website or on any reports or ratings published on this website nor any copy of it, nor any other reports or copies of them published on CrowdRating.co.uk may be reproduced, redistributed or copied in whole or in part for any purpose. Any and all reports have been approved by, and are being distributed in the UK and the European Union (EU) only and are not to be distributed in any other jurisdictions where their distribution may be restricted by law and persons into whose possession this or any other reports come should inform themselves about and observe such restrictions.

This report and any other reports published on CrowdRating.co.uk do not constitute an offer or a solicitation to buy or sell any securities referred to herein. It should not be so construed, nor should it or any part of it form the basis of, or be relied on in connection with, any contract or commitment whatsoever. The information on this website or in reports or ratings published by Wheatfromchaff, or on which this or any other reports are based, has been obtained from sources that Wheatfromchaff believes to be reliable and accurate, and in accordance with COBS 2.4 of the FSA Handbook we have verified it to the best of our ability. However, it has not been independently verified and no representation or warranty, express or implied, is made as to the accuracy or completeness of any information obtained from third parties. The information or opinions are provided as at the date of this report or any other report publication dates and are subject to change without notice. The information and opinions provided in this and any other reports take no account of the investors/ individual circumstances and should not be taken as specific advice on the merits of any investment decision. Investors should consider any or all of the reports or ratings we publish as only a single factor in making any investment decisions.  

Wheatfromchaff does not accept any liability whatsoever for any direct or consequential loss however so arising, directly or indirectly, from any use of this report nor its contents. Investors may receive back less that they invested as investments may fall as well as rise in value. Investors should obtain independent advice based on their own circumstances before making investment decisions. By accepting this report you agree to be bound by the foregoing limitations.

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

© Wheatfromchaff Ltd All Rights Reserved February 2017