[XCP] Adeally IPO Monday April 28

[Mrrr]

2) Swoopo. Arguably the pioneer of penny auction sites in 2008 and the biggest at the time of it's bankruptcy filing. "Overall, Swoopo operated a flawed business model as it relied on creating value (for itself and the 1% of winners) at the expense of the majority of its customers.  For more on this, check out http://t.co/O78595H"

...

Buy-It-Now
One game-changer the helped right the ship if you will was the creation of the Buy It Now option. Adeally will have this on every auction and it's explained in depth in the Business Plan. Essentially it's available to losers of auctions as a way to get their bids back and have a good experience on the site. Before this innovation was created the industry had a bad reputation and customers were rightfully pissed off because they didn't win anything and lost money to boot! Still, more than half the other penny auction sites out there do not offer this option to their customers.

Now if I click that link you just provided about Swoopo I read:

Looks like a great business right?  Wrong.  Just two months ago Swoopo, the venture backed pioneer of penny auctions, filed for bankruptcy.   

But how could this happen?  I mean, look at those margins!   Well, in order to appease the growing complaints over its business model (and to try to keep customers returning), Swoopo introduced a buy it now feature which allowed users to use the value of their lost bids to buy a product directly from Swoopo.  Essentially, Swoopo was trying to create a win-win value proposition for its business and its customers.  The problem? Swoopo’s service created no incremental value.  Thus, the buy it now product decimated its own profit margin as it simply shifted dollars back into the hands of the customers.

[LiteBit]

2) Swoopo. Arguably the pioneer of penny auction sites in 2008 and the biggest at the time of it's bankruptcy filing. "Overall, Swoopo operated a flawed business model as it relied on creating value (for itself and the 1% of winners) at the expense of the majority of its customers.  For more on this, check out http://t.co/O78595H"

...

Buy-It-Now
One game-changer the helped right the ship if you will was the creation of the Buy It Now option. Adeally will have this on every auction and it's explained in depth in the Business Plan. Essentially it's available to losers of auctions as a way to get their bids back and have a good experience on the site. Before this innovation was created the industry had a bad reputation and customers were rightfully pissed off because they didn't win anything and lost money to boot! Still, more than half the other penny auction sites out there do not offer this option to their customers.

Now if I click that link you just provided about Swoopo I read:

Looks like a great business right?  Wrong.  Just two months ago Swoopo, the venture backed pioneer of penny auctions, filed for bankruptcy.    

But how could this happen?  I mean, look at those margins!   Well, in order to appease the growing complaints over its business model (and to try to keep customers returning), Swoopo introduced a buy it now feature which allowed users to use the value of their lost bids to buy a product directly from Swoopo.  Essentially, Swoopo was trying to create a win-win value proposition for its business and its customers.  The problem? Swoopo’s service created no incremental value.  Thus, the buy it now product decimated its own profit margin as it simply shifted dollars back into the hands of the customers.

In short our business model revolves around bid pack sales (Play Packs) and drop shipping products... The majority of other penny auction sites instead develop a business model around product listings

Like I said, their business model was built around product listings which ultimately was their downfall. Our business model is based on sales of bid packs and drop shipping. We've built Buy It products into our 3 year projections. They didn't. So when they stopped screwing over their customers and offered the Buy It Now their model wasn't built to handle it. That's how we can offer it and not lose our shirt if we are constantly refunding bids back to customers choosing this option. It's the only sustainable model for growth year after year.

A good example of the 2 ways we could run our business model is in the link I provided to they excel file I made: http://adeal.ly/Npwja
EDIT: Disclaimer
This document does not represent our full financial projections. The 2 values that are represented in the totals are related to auction listings and ecommerce listings only. The accounting terminology was for in-house purposes because these values are static copies of in-house documents used to project the next 3 years of the Company as laid out in detail in the "Financials Section" of our Business Plan. G&A, payroll, overhead, etc. are not included in this document.

The top example is our growth projections with Buy It purchases built in. This shows roughly 50% revenue coming from Buy It purchases and 50% coming from Play Pack sales. The bottom example is our growth projections without Buy It purchases built in. It shows 90+% revenue coming from Play Pack sales and no number accounting for potential Buy It purchases.

The bottom example has 3x better revenue numbers and the Gross Margin numbers are close to 70%! compared to the 20%'s in the top example. Sounds best right? Not if we want to offer Buy It Now for our customers. If we're budgeting and projecting 70% margins when in actuality we should expect 20% margins we won't stay in business very long.

[LiteBit]

Grove City, hunh?

I've sent the contact E-mail a message for a request for personal meeting. I live 15mi from the address listed. For what its worth, I can verify this company and its legitimacy if I can schedule a meeting.

Let's get together. Response sent.

[sporket]

Just looked at your spreadsheet.   WTF am I looking at?  Is it just static?  Where did you get those numbers?

...our business model is in the link I provided to they excel file I made: http://adeal.ly/Npwja
...

[rethink-your-strategy]

Just looked at your spreadsheet.   WTF am I looking at?  Is it just static?  Where did you get those numbers?

...our business model is in the link I provided to they excel file I made: http://adeal.ly/Npwja
...

This "spreadsheet" broke my brain. OP is clearly mentally retarded. Lack of calculations aside, it's like someone failed Accounts 101 and vomited out a spreadsheet...

"Net Revenue" is Gross Revenue less Discounts and Returns for the period. It is NOT Sales less CoGS. Ever. Also, on that topic, Cost of Sales does *not* include general and administrative expenses or other costs (ie. SG&A).

I suspect they meant "Gross Profit" (they certainly couldn't have meant "Net Profit" unless they're idiotic), which this is clearly not. If they meant EBIT or EBITDA and were aiming at a Net Income calculation they clearly failed. This isn't an income statement, this is a bunch of bullshit numbers that make no sense and don't account for anything except (possibly) the raw cost of the goods.

No business that expects to hit $220 million in gross revenue in 4 years runs at zero overhead. You know who makes that in a year? [Suspicious link removed]j.com/venturecapital/2010/07/12/the-100m-revenue-club-eharmony-captures-hearts-of-vcs/]Fucking eHarmony[/url]. You are not the next eHarmony-sized business.

[LiteBit]

Just looked at your spreadsheet.   WTF am I looking at?  Is it just static?  Where did you get those numbers?

...our business model is in the link I provided to they excel file I made: http://adeal.ly/Npwja
...

Yes, this is a static spreadsheet. It's a compilation of 2 of our 120 scenarios we ran to create a sustainable phased growth plan as outlined in the Business Plan. These are a copy of the final numbers that get plugged into the 3 year projection detailed in that document. They are static because all the imported data is linked to other documents that helped create the numbers. All of this (the rigor we used) is explained in detail in the Business Plan "Financial Section". To clarify, I created this document for a quick comparison of our 3 year projections (top) versus the highest profit scenario which eliminates Buy It projections... which looks best at first look but would kill us eventually... like the Swoopo example.

Just looked at your spreadsheet.   WTF am I looking at?  Is it just static?  Where did you get those numbers?

...our business model is in the link I provided to they excel file I made: http://adeal.ly/Npwja
...

This "spreadsheet" broke my brain. OP is clearly mentally retarded. Lack of calculations aside, it's like someone failed Accounts 101 and vomited out a spreadsheet...

"Net Revenue" is Gross Revenue less Discounts and Returns for the period. It is NOT Sales less CoGS. Ever. Also, on that topic, Cost of Sales does *not* include general and administrative expenses or other costs (ie. SG&A).

I suspect they meant "Gross Profit" (they certainly couldn't have meant "Net Profit" unless they're idiotic), which this is clearly not. If they meant EBIT or EBITDA and were aiming at a Net Income calculation they clearly failed. This isn't an income statement, this is a bunch of bullshit numbers that make no sense and don't account for anything except (possibly) the raw cost of the goods.

No business that expects to hit $220 million in gross revenue in 4 years runs at zero overhead. You know who makes that in a year? [Suspicious link removed]j.com/venturecapital/2010/07/12/the-100m-revenue-club-eharmony-captures-hearts-of-vcs/]Fucking eHarmony[/url]. You are not the next eHarmony-sized business.

This was never portrayed as our full business financials document. This is a compiled spreadsheet created to help answer a user's question. We encourage you to look at the "Financials Section" of our Business Plan. It has the process of how our numbers were created and the correct "accounting lingo" you are looking for. Starting with the the value of products we will list, to the number of these listings, to our overhead, G&A, payroll, consultants and much more.

As said in the above response to user sporket, I created this document for a quick comparison of our 3 year projections (top) versus the highest profit scenario which eliminates Buy It projections... which looks best at first look but would kill us eventually... like the Swoopo example.

[LiteBit]

I've added a disclaimer to follow the document that is causing some confusion.
EDIT: Disclaimer
This document does not represent our full financial projections. The 2 values that are represented in the totals are related to auction listings and ecommerce listings only. The accounting terminology was for in-house purposes because these values are static copies of in-house documents used to project the next 3 years of the Company as laid out in detail in the "Financials Section" of our Business Plan. G&A, payroll, overhead, etc. are not included in this document.

I see how at first look users can be confused by what they see without any explanation to accompany it. Hopefully that helps clear up any misinterpretation.

[Adeally]

Directions on purchasing BOMB shares have been provided here: https://bitcointalk.org/index.php?topic=581995.msg6361040#msg6361040

[LiteBit]

We appreciate the interest regarding our upcoming offering this Monday. Good to see investors picking up shares already. The full 300,000 will be loaded by Monday, April 28th 2014 @ 12:00pm EST.

[LiteBit]

How do I buy shares?

XCP Ticker | BOMB
BOMB/BTC rate | 145.985401

1. Open a Counterwallet account via https://counterwallet.co/
2. Deposit funds into your account
3. Place order for BOMB via "Buy & Sell" tab
4. Orders will be match automatically and transfer to your wallet.

Video tutorial | https://www.youtube.com/watch?v=ZziQ2Ns8314

BOMB shares are only being sold for BTC at a price of BTC0.00685 per share.
When you place your order use the BOMB/BTC rate of 145.985401

We can pay dividends in BTC using Counterwallet and a list of public addresses, etc.. associated with the BOMB asset can be found here: http://blockscan.com/assetInfo.aspx?q=BOMB

When can I buy shares?

Schedule
The full amount of shares (300,000) will be available for purchase on Monday, April 28th 2014 @ 12:00pm EST.

Adeally equity shares [BOMB] are now available to purchase exclusively through Counterparty. All 300,000 shares at BTC0.00685 per share have been made available to investors.

Public Bitcoin address is here: https://blockchain.info/address/15Q2MN962s3sRSYSFiRkgNgD1NFzBTgHTe
Public Counterparty address is here: http://blockscan.com/address.aspx?q=15Q2MN962s3sRSYSFiRkgNgD1NFzBTgHTe
Public Counterparty asset is here: http://blockscan.com/assetInfo.aspx?q=BOMB
**Public shareholder stake and addresses can be found in the Shareholder tab

[LiteBit]

BOMB shares are now also available for sale with XCP.

XCP Ticker | BOMB
BOMB/XCP rate | 0.510624

[superbit]

Stopped reading after the valuation.  Over 7 million dollars for an idea and some coding.  This is not 1999.

[AcoinL.L.C]

1: Why are you offering over 2 million dollars "worth" of shares for sale, when you told the SEC it would be under 1 million?
2: Your a fool if you think your business is going to be having revenues of $200,000,000+ within 4 years off an idea that has already been milked for all its worth. Years ago.
3: Anyone that buys shares in this is lacking a few brain cells. Please post your username here so everytime you complain of getting scammed I can have a laugh.

Just love the valuation... No assets....No revenue...The site hasn't even been built....Issuer has put little to no funding of their own into this (Why else would you be selling shares if you haven't even completed the site? You clearly can't afford / won't pay for the site out of your own pocket).

 

[LiteBit]

1: Why are you offering over 2 million dollars "worth" of shares for sale, when you told the SEC it would be under 1 million?
2: Your a fool if you think your business is going to be having revenues of $200,000,000+ within 4 years off an idea that has already been milked for all its worth. Years ago.
3: Anyone that buys shares in this is lacking a few brain cells. Please post your username here so everytime you complain of getting scammed I can have a laugh.

Just love the valuation... No assets....No revenue...The site hasn't even been built....Issuer has put little to no funding of their own into this (Why else would you be selling shares if you haven't even completed the site? You clearly can't afford / won't pay for the site out of your own pocket).

 

1. This offering is for $1M. The accompanying Prospectus details this. The Form D filed with the SEC is an intent to sell. They allow amendments to be filed post sale which we will file anyways because the offering hadn't taken place at the time of our filing.
2. Our Net Revenue projections reach $31M in 4 years. We include comparisons of competitors in the Business Plan and their weekly revenue. Our projections parallel 3-4 year old companies in the same space.  The 5 companies we benchmark in the plan are still very successful at recruiting and retaining customers. Mobile ecommerce is trending up, not down.

Our personal contribution is available under the Balance Sheet section of both documents.

[DeathAndTaxes]

So you filed a false Form D?  You are offering securities by public solicitation and state the opposite to the SEC.  This very thread is proof of that.   There is actually no condition of Reg D 506(b) that you actually complied with.

The goods news for investors is that the issuer has no safe harbor protection under a fraudulent filing so the personal assets of the seller are not shielded from securities fraud litigation.  The crazy part is not that you did it fraudulently it is that you did it fraudulently and then filed it publicly with the SEC.  That has to be first even for "Bitcoin securities".  I mean all it takes is an investigator of the SEC to come to this thread and there is sufficient grounds that your filing is fraudulent.  You do know that is why services like gust and angel list exist right?

For those interested in the limitations imposed on a real Reg D 506(b) offering the following is a summary but one should always obtain qualified legal advice as this is just a summary

Rule 506(b)
A company that satisfies the following standards may qualify for an exemption under this rule:

Can raise an unlimited amount of capital;
Seller must be available to answer questions by prospective purchasers;
Financial statements need to be certified by an independent public accountant;
Purchasers receive restricted securities, which may not be freely traded in the secondary market after the offering;
Seller is prohibited from using general solicitation or advertising to market the securities.

The sale of securities under Rule 506(b) may be made to an unlimited number of accredited investors and up to thirty five other purchasers.
Unlike Rule 505, all non-accredited investors, either alone or with a purchaser representative, must be sophisticated - that is, they must have sufficient knowledge and experience in financial and business matters to make them capable of evaluating the merits and risks of the prospective investment.

[LiteBit]

So you filed a false Form D?  You are offering securities by public solicitation and state the opposite to the SEC.  This very thread is proof of that.   There is actually no condition of Reg D 506(b) that you actually complied with.

The goods news for investors is that the issuer has no safe harbor protection under a fraudulent filing so the personal assets of the seller are not shielded from securities fraud litigation.  The crazy part is not that you did it fraudulently it is that you did it fraudulently and then filed it publicly with the SEC.  That has to be first even for "Bitcoin securities".  I mean all it takes is an investigator of the SEC to come to this thread and there is sufficient grounds that your filing is fraudulent.  You do know that is why services like gust and angel list exist right?

For those interested in the limitations imposed on a real Reg D 506(b) offering the following is a summary but one should always obtain qualified legal advice as this is just a summary

Rule 506(b)
A company that satisfies the following standards may qualify for an exemption under this rule:

Can raise an unlimited amount of capital;
Seller must be available to answer questions by prospective purchasers;
Financial statements need to be certified by an independent public accountant;
Purchasers receive restricted securities, which may not be freely traded in the secondary market after the offering;
Seller is prohibited from using general solicitation or advertising to market the securities.

The sale of securities under Rule 506(b) may be made to an unlimited number of accredited investors and up to thirty five other purchasers.
Unlike Rule 505, all non-accredited investors, either alone or with a purchaser representative, must be sophisticated - that is, they must have sufficient knowledge and experience in financial and business matters to make them capable of evaluating the merits and risks of the prospective investment.

We filed our Form D around a month before this offering was drawn up and complete. As stated previously, an amendment will need to be filed when the offering is finished to correct our amount raised and dates ('Offering to be held at a future date' was originally filed). As also pointed out and agreed upon by us, filing the amendment under Rule 506(b) is out of the question because of the same reasons you list. We agree and also reference the same verbiage you quoted from the SEC.gov website within the Prospectus.

Moving forward most likely will include restructuring the offering per 506(c), getting experienced advice on valuation criteria (hot topic), filing an amendment and taking a look into funding via an AngelList platform that caters to accredited investors. This will all need to be evaluated and a decision to move forward or not will need to be made.

TL;DR We agree

[mikaeldice]

We filed our Form D around a month before this offering was drawn up and complete. As stated previously, an amendment will need to be filed when the offering is finished to correct our amount raised and dates ('Offering to be held at a future date' was originally filed). As also pointed out and agreed upon by us, filing the amendment under Rule 506(b) is out of the question because of the same reasons you list. We agree and also reference the same verbiage you quoted from the SEC.gov website within the Prospectus.

Moving forward most likely will include restructuring the offering per 506(c), getting experienced advice on valuation criteria (hot topic), filing an amendment and taking a look into funding via an AngelList platform that caters to accredited investors. This will all need to be evaluated and a decision to move forward or not will need to be made.

TL;DR We agree

You were already warned about this once, but you decided to proceed.  But, hey, your choice, right?

Unfortunately, your offering will not accommodate 506(c), either.  Under 506(b) your investors can self-certify as accredited investors, but under 506(c) you need to take reasonable steps to verify that they are qualified as accredited investors.  This means collecting personal information to verify identity as well as supporting documents that prove a net worth over $1m USD or earned income exceeding $200k for each of the past two years.

The Counterparty platform on which you've already begun selling has no means to enforce this (though this has already been mentioned), or to limit their resale...

Just be happy that nobody has mentioned the Whistleblower program, which provides a 10-30% bounty on SEC enforcement actions that result from tips on possible SEC violations.  With all of the faucet mongers on this forum, I imagine at least one or two of them would spend a few minutes on the SEC website for a payday down the road.

[sporket]

^Before we get too deep into corporate law:

Of the $2,000,000.00 on offer, exactly $98.47 was raised. ( https://blockchain.info/address/15Q2MN962s3sRSYSFiRkgNgD1NFzBTgHTe )

I'm sure SEC helicopters aren't circling over OP's shack just yet.

[DeathAndTaxes]

As mikeaeldice pointed out 506(c)

^Before we get too deep into corporate law:

Of the $2,000,000.00 on offer, exactly $98.47 was raised. ( https://blockchain.info/address/15Q2MN962s3sRSYSFiRkgNgD1NFzBTgHTe )

I'm sure SEC helicopters aren't circling over OP's shack just yet.

Well that is a good thing for the OP.  Although if things went the OP was hoping then he would have sold hundreds of thousands of dollars of fraudulent securities.   Just pointing out the hilarity of playing fast and loose with the rules AND then registering with the agency responsible for ensuring people don't play fast and loose with the rules.

[LiteBit]

Unfortunately, your offering will not accommodate 506(c), either.  Under 506(b) your investors can self-certify as accredited investors, but under 506(c) you need to take reasonable steps to verify that they are qualified as accredited investors.  This means collecting personal information to verify identity as well as supporting documents that prove a net worth over $1m USD or earned income exceeding $200k for each of the past two years.

Yes, in order to comply with 506(c) we'd have to go through another avenue that has a proper verification process for it's accredited investors.

^Before we get too deep into corporate law:

Of the $2,000,000.00 on offer, exactly $98.47 was raised. ( https://blockchain.info/address/15Q2MN962s3sRSYSFiRkgNgD1NFzBTgHTe )

I'm sure SEC helicopters aren't circling over OP's shack just yet.

And buy orders of those 31 shares are in the order book to refund investors.

God Bless the USA