|1||1 million LGBTQ friendly accommodations in 200 countries|
|2||20% month over month growth thanks to the 2019 Wefunder round|
|3||1st LGBTQ app selected 2X by Apple as “App of the day” (2018 & 2019)|
|4||$15M transaction volume in 2019. In 2020, we expected $30M with our new hotel offering, pre-COVID|
|5||Joel Simkhai (Grindr founder, sold for $300M USD) early investor.|
|6||Profitability planned in 2020 before Covid-19|
|7||Rated 4.3/5 on Google Store & 4.7/5 on Apple Store|
|8||We give back to the LGBTQ community through our mister for good program|
The mission behind misterb&b is to help our community travel safe, connect and feel welcome everywhere they go. In 2020, faced with the impact of the Covid-19 pandemic, we managed to act early and to make sure we would weather this storm. While doing so, we were able to live up to our values as we helped LGBTQ young adults find emergency housing away from their homophobic families during lockdowns. “Without this help, I don’t know where I would be today”, says Dimitri, 20 yo.
The desire to travel and connect, exploring and discovering are basic human needs. With short-term rentals and now LGBTQ friendly hotels thanks to our successful 2019 Wefunder round, we are getting ready for the recovery of the travel industry. Our fundamentals put us in a very strong position to thrive once the world recovers, as our story below shows.
In 2013, Matthieu Jost (picture below) booked a private room in Barcelona with his partner. When they got there, it was clear the host didn’t feel comfortable hosting a gay couple. The weekend turned into the most awkward travel experience. Jost started misterb&b so that no one from the LGBTQ community would ever experience that again
misterb&b is a website that exclusively lists LGBTQ-friendly accommodations around the world. Individuals (LGBTQ folks as well as straight allies) can list rooms or apartments for rent. Nightly rates are determined by hosts. misterb&b also lists booking options at local gay-owned or gay-friendly hotels (you can toggle the hotel option on or off when you search).
The service is currently live in more than 200 countries. misterb&b not only offers that you will be able to find a safe and LGBQT-friendly space to stay, but also that you’ll be able to connect with other travelers, meet and get travel tips from others in the LGBTQ community when you travel.
The company was launched in France. But when we needed funds to fuel our growth, we couldn’t find support from local VCs: obviously, serving the LGBTQ market was an insurmountable handicap for this financial community.
We eventually decided to move the company to Silicon Valley. Pitching misterb&b became so much easier, no need to justify the LGBTQ market anymore. We closed a series of seed rounds for $2M in early 2015.
We joined Batch 12 of 500 Startups, one of the 3 best accelerator programs in the world, in San Francisco in early 2015. That was definitely a milestone. After Demo Day, misterb&b was one of the 6 companies (out of 20 in our batch) to receive an investment from 500 Startups. We exited the 4 months program with $2.5M USD new money in the bank and… an award for Best Pitch!
In 2017, we raised $8.5M in our Series A round and that same year, we reached 1 million USD in transactions per month. This round helped us to scale our marketing, our tech/back offices and for sure, our team.
In June 2018, for Pride, Apple featured misterb&b as App of the Day in their App store. We were the first gay app named App of the Day. And that's because Apple believed in our mission and purpose and were willing to associate their brand with ours. Apple featured us again in 2019 as App of the Day.
After being funded by institutional money, we decided to empower our community of hosts and travelers even more by launching a special crowdfunding round on Wefunder and give them the opportunity to own a piece of the company and take part in its success. We wanted to build equality into the sharing economy and give back to a community that’s been historically economically marginalized providing our community with the power of part ownership of the company.”
After closing our Wefunder round, everything accelerated. We hired developers to work on implementing our LGBQ hotel offering. This was a big challenge due to complexity of this type of business (API for live calls on availability and pricing, A/B testing, algorithm tweaks etc.). We also added a social layer on the LGBTQ friendly hotel service allowing our guests and hosts to connect and discover who will be staying in the same hotel/city to explore the city together. It was a 6 month technical project. Then we kicked off marketing. By the end of Q1, we were growing bookings 20% month over month, until the global pandemic hit.
LGBTQ Hotel Gaythering Miami
The desire to travel and connect is a basic need, exploring and discovering is part of who we are as humans. Traveling might be different after the coronavirus pandemic but our fundamentals put us in a very strong position to thrive once the world recovers. We have been able to scale down our expenses (4X less) and are ready to scale up as travel bounces back. This new round is to develop a Safety protocol and technical solution to help our guests and hosts navigate through this unexpected event. It will also help to rekick off our growth efforts.
At misterb&b we believe in people, purpose and profit. We supported Le Refuge, a French non-profit helping find short term housing for LGBTQ young adults in crisis, through our Mister for Good program before Covid-19 so it was only natural that we would assist during the Covid-19 crisis. For some young members of the community, being forced to stay home 24/7 with their homophobic families turned out to be very toxic, sometimes violent and finding a safe place for them was essential.
After reaching out to our community, many misterb&b hosts answered our call for help, and offered their accommodations to LGBTQ teens in crisis for free. Thanks to their solidarity, we have been able to provide emergency housing for almost a dozen young people.
“Without this help, I don’t know where I would be today”, says Dimitri, 20 yo, grateful for this partnership with misterb&b
In addition we reached out to our local host community and found places for doctors, nurses, and other medical professions to stay while they worked on the front lines of the health crisis. This lessened the risk to their family at home.
misterb&b is not just another Online Travel Agency (OTA) or booking engine in the travel market. Our mission is to help our community travel safe, connect and feel welcome everywhere they go. This service has now become very important to even more LGTBQ travelers.
Why another Wefunder round? Our first crowdfunding went way beyond our expectations, on so many levels. Among other things, we managed to build a network of LGBTQ and LGBTQ-friendly investors who are now our advocates around the world. Some of them contributed on specific topics, showing us the strength of the community and the importance and relevance of our purpose. It also created an emotional bond between the community and the company. As this 2019 Wefunder round was oversubscribed, we thought another round would be a great opportunity for those who were not able to join.
We are a for-profit business and we strongly believe that having a successful business is key to strengthening our community: hiring LGBTQ employees across our 3 offices, demonstrating that a LGBTQ business can be successful, and inspiring others to succeed and helping people in need.
We’re looking forward to welcoming you to our team of investors! Your support will help us adapt the company to the “new normal” while giving back to the community: with you, we’ll help hosts and guests overcome their fear of traveling, help hosts earn much needed income from their spare space, and we’ll find our way back to our strong growth and continue our mission & purpose for our community.
misterb&b has financial statements ending December 31 2019. Our cash in hand is $1,200,000, as of May 2020. Over the three months prior, revenues averaged $50,000/month, cost of goods sold has averaged $4,000/month, and operational expenses have averaged $140,000/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.
misterb&b empowers the LGBTQ community to travel more safely, feel welcome & get local insider tips wherever they go. We're the world’s largest gay travel lodging platform, with more than 1 million accommodations across 200 countries (private rooms, appartements, LGBTQ friendly hotels). With more than $15M+ raised institutionally, we want to offer once again our loyal community and supporters the opportunity to own a part of the company.
The driving mission behind misterb&b is to ensure all LGBTQ travelers and hosts can connect in real life and feel welcome everywhere. We started with short-term rentals and added LGBTQ friendly hotels thanks to the super successful 2019 Wefunder round. We want to be the go-to travel company for the LGBTQ community, where you read a city guide by a gay local, book a place to stay, and book all your tourist experiences, knowing that you're getting the safest travel experience out there.
SFO84, Inc was incorporated in the State of Delaware in March 2014.
Since then, we have:
Historical Results of Operations
Liquidity & Capital Resources
To-date, the company has been financed with $11,640,477 in equity, $2,053,497 in convertibles, and $1,139,500 in SAFEs.
After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 15 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 16 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
SFO84, Inc cash in hand is $1,200,000, as of May 2020. Over the last three months, revenues have averaged $50,000/month, cost of goods sold has averaged $4,000/month, and operational expenses have averaged $140,000/month, for an average burn rate of $94,000 per month. Our intent is to be profitable in 12 months.
If the business go back to normal (same revenues like last year), we will be profitable instantly. If the business takes more time to go back to normal, we will need more time to reach the profitability.
We have been hit by the Covid-19 pandemic with 95% dropping business YoY. Bookings are starting to bounce back.
We expect (but cannot guarantee) for our revenues to go back to 70% YoY by October 2020 and to continue to increase over the months with a full recovery in Spring 2021. We are very agile and can scale up or down rapidly thanks to our marketplace business model. Our low fixed costs mean that the company's expenses rise and drop along with our revenue, making it easier to endure the current situation. We plan our expenses to stay pretty similar in the upcoming months.
misterb&b has been through travel disruptions before and expects this will end as others have. We can weather this storm with our strong operating model & loyal global gay community of travelers and hosts. We are confident in our long-term strategy and continue to manage the company carefully to maintain and build value for the long term.
Current investors support, bank loan as well as PPP program and your support through this Wefunder round.
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.
To increase revenues we must expand our userbase. To accomplish this, we must increase our visibility in the marketplace. Potential customer must be aware we exist and be able to find us. We need to demonstrate how our website can be useful to them. That could require us to devote more resources to marketing efforts, including advertising and other expenses, to build public awareness of our brand. Even with an enhanced marketing effort, there is no guarantee that we will be able to increase the number of new visitors to our website and in turn, convert them into customers or users. Any number of conditions could affect the success of our marketing effort, which could have a negative impact on user experience with our website and adversely affect our results of operations and future growth.
We may be subject to future governmental regulations. Aspects of our business and our products may be regulated at the local, state, and federal levels. The nature and scope of future legislation, regulations and programs cannot be predicted. While we anticipate that we and our products will be in compliance with all applicable governmental regulations, there still may be risks that such laws and regulations may change with respect to present or future operations. Such additional costs would increase the cost of investments and operations and decrease the demand for services. We and our products will be ultimately responsible for compliance with such regulations and for obtaining and maintaining all required permits and licenses. Such compliance may be time consuming and costly, and such expenses may materially affect our future ability to break even or generate profits.
To remain competitive, we must continue to enhance and improve the functionality and features of our websites and technology infrastructure. As a result, we will need to continue to improve and expand our hosting and network infrastructure and related software capabilities. These improvements may require greater levels of spending than we have experienced in the past. Without such improvements, our operations might suffer from unanticipated system disruptions, slow application performance or unreliable service levels, any of which could negatively affect our reputation and ability to attract and retain customers and contributors. Furthermore, in order to continue to attract and retain new customers, we are likely to incur expenses in connection with continuously updating and improving our user interface and experience. We may face significant delays in introducing new services, products and enhancements. If competitors introduce new products and services using new technologies or if new industry standards and practices emerge, our existing websites and our proprietary technology and systems may become obsolete or less competitive, and our business may be harmed. In addition, the expansion and improvement of our systems and infrastructure may require us to commit substantial financial, operational and technical resources, with no assurance that our business will improve.
The company may face difficulties attracting customers which could undermine its operations and severely impact its ability to operate.
From time to time, the Companies may be involved in claims and legal actions arising in the ordinary course of business. The Companies are not presently involved in any legal proceedings which management expects individually or in the aggregate to have a material adverse effect on its combined financial condition or results of operations or cash flows.
The return of Covid19, lockdowns or a new epidemic can also be potential risks to the business
We may need to acquire or develop new products, evolve existing ones, address any defects or errors, and adapt to changes in technology in order to continue growing our business.
Like all the travel industry, the company has been hit by the Covid19 pandemic with 95% dropping business YoY. The future of the travel industry is uncertain and revenues may continue to suffer.
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