KC Underweight Deal: A Well Intentioned Business With Struggling Financials

Key Stats:

Summary

Today, in our series of rating to crowdfunding deals, we’re diving into Vibravision currently raising on the Mr. Crowd platform.

Vibravision offers specific technology and training programs to help people awaken their minds. People are trained to use their untapped potential and to be able to see the world around them, even if they are visually-impaired. Vibravision, LLC was founded by Nathan and Mike Zeleznick in 2016.

Vibravision follows the Merpati Putih system which was developed by the Royal Family of Java. Training includes working on fitness, consciousness expansion, meditation, breathing work, and energy expansion to increase awareness of the world around us. The method has been used in the past to help individuals see in the dark, and now it is being expanded to help blind people.

Our most significant concern regarding Vibravision is its uniqueness on the marketplace. The approach and methods are so new and different that it is difficult for people to accept and believe it. The techniques are not scientifically proven, making it all the more incredible for to doubters.

We also have concerns about the financial health of Vibravision. In spite of being operational for more than two years, the company has reported meager revenues and a net loss both years.

To make matters more dubious, Vibravision has a pre-money valuation of $7 million. We can only ask: “Why?” Such a high valuation for a company with low revenues seems unjustifiable.

To get a complete picture of Vibravision, what follows is an in-depth review of the pros and cons of the deal. As always, investors should be aware of the pros and cons before investing in any startup.

Vibravision, LLC: Raising on Mr. Crowd

Limited Target Audience and A Discretionary Expense

The concept behind Vibravision looks exciting. However, the matter of concern is how many sighted or visually-impaired people are open to the idea and feel the need for it. The training methods are intensive and require much time, dedication, and commitment to achieve proficiency.

First, the number of visually impaired individuals in Utah is limited to about 54,000. It restricts the target audience, and the only other potential customers are those who want to “enhance their awareness and/or consciousness.” Of the 54,000, many might not be financially able to pay the company’s fees and aware of learning the offered skills.

Looking more broadly at the marketplace, the skills and training offered by Vibravision are a discretionary expense in our estimation. They include prerequisite training courses before beginning the training with Vibravision methods. Should hard times arrive for a customer, such training will be the first thing to go.

The Method

Vibravision is an unfamiliar method, at least in the United States. This is not to say that this won’t change. After all, there was a time when few had heard of yoga. What should be pointed out is that the techniques are not yet scientifically proven in the US and cannot be quantified by Western science and medicine.

What should be kept in mind is the fact that Vibravision’s future success will require a sizable marketing effort to become established. Even if Vibravision is successful in convincing the customers, any negative publicity or challenges will affect the business adversely.

Weak Financials and Inflated Valuation

Vibravision has been in business since 2016. In spite of an operating history stretching back more than two years, the company is yet to make its mark. Vibravision reported revenues of $25,175 and a net loss of $1,995 for the financial year ended December 31, 2017. Moreover, there were no revenues in the prior fiscal year.

Thus, for a company with such weak financials and limited operating history, a pre-money valuation of $7 million is preposterously high. Such low revenues and little growth imply that the company might not even have a true business.

Even if one believes in Vibravisions future they must then contend with the company’s lack of a competitive advantage or unique proposition that is valued in the marketplace.

Rating

As we’ve outlined, Vibravision is not yet an established business in the United States and it will likely be some time before it becomes a thriving enterprise.

Due to a lack of public awareness for its unique brand of services, the company may need to spend a lot more on advertising and marketing to attract and retain more customers.

For these reasons, we are assigning Vibravision an Underweight Deal rating.

The target audience of Vibravision is very restricted, and so is the scope. Even if customers are convinced to start with the training programs, getting them to continue with the program will always be an uphill task.

As proof of this, we offer the lack of sizable revenues and profits.

As always, investors should perform their own due diligence before deciding to invest in Vibravision.

If you have any questions regarding the underweight rating of Vibravision, please contact us at hello@kingscrowd.com.