Deal To Watch: A Company Bringing Better Communication To Incarceration

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Summary

One of my favorite things about covering the equity crowdfunding market is that with each passing week the opportunities and selections get stronger and stronger as legitimacy, awareness, and ultimately capital begin to flood the space.

This week, I bring you the first weekly KINGSCROWD deal recommendations. First up, Pigeonly currently raising on Republic.

Overview

Pigeonly is in the business of providing low-cost inmate communication services, which turns out is a $4 billion market, with 10% of the US population having at least one friend or family member incarcerated. To date, the services available for communicating with inmates have been wrought with predatory pricing.

With the proprietary Haystac KPI the team has built, Pigeonly can track where over 1M inmates across 17K prison facilities are at any one time, and make it seamless for friends and family to find and connect with them for one low subscription price. The team is on pace to reach over $3M in revenue this year and has over 10K subscribers across 88 countries connecting with over 100K US based inmates.

Some of the biggest names in VC have backed Pigeonly including 500 Startups, Social Capital and Kapor Capital. Interestingly enough, this business was born out of a real life experience for founder Frederick Hutson, who went to prison himself in his early 20’s. From that experience he decided to take his life in a new direction and has proven that second chances can lead to great results. At a $15M valuation, which is 5X the current annual revenue, Pigeonly presents a reasonably priced opportunity with the team estimating $40M in gross revenue over the next 24 months, aka a 3X upside on the current valuation.

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