Optelos is offering a convertible note, accruing a 5% interest rate per annum at a pre-money valuation of $8 million with a 20% discount. Investments under $20,000 will be made under the Regulation CF type, and investments over that amount will be under the Regulation D type. Given the company’s place in the market, secure patents, and growing revenue over the past couple of years, this valuation is reasonable, if not stellar. Thus, Optelos’ price score is above average.

All manner of industries require competent, thorough inspections of equipment and facilities. Optelos primarily directs its attention to the oil and gas, energy, industrial manufacturing, telecom, and construction industries. These are massive and profitable markets that, while suffering slowdowns as a result of the ongoing COVID-19 pandemic, are set up for continuous growth in the near future. The digital inspection market on a whole is competitive and growing — it’s projected to reach $28.9 billion by 2025, accounting for the effects of the pandemic.

While Optelos’ share of the market is limited to media processing — it does not provide the drones and machinery required for the inspections themselves — it has established solid partnerships with companies like DroneDeploy with promising early results. Because the company’s market potential is somewhat dependent on the performance of other companies, Optelos’ market score is middle of the road.

Optelos is led by a team with an assortment of relevant industry experience, making the company as a whole-well positioned to expand their current customer base. David Tran is the company’s current CEO, CTO, and a Co-founder. He holds an MBA in Business Development from Southern Methodist University. Tran has sixteen years of business management and marketing experience with Fluke Networks, and extensive experience in the telecom industry, one of Optelos’ main target industries.

David Collmann, a company co-founder and chairman, serves as the CEO of TesCom USA, a company that manufactures test equipment for telecom companies as well as offering calibration and repair services. Collmann is a long-time member of TesCom, having worked his way up from a Sales Rep position, and his decades of experience make him a valuable partner for Optelos. Kevin McKeand serves as a current vice-chairman and previous CEO, and brings years of experience working for and with AT&T telecommunications. VP of Operations Neil Inman brings his experience as the CEO of a drone services company, NuAge Aerial Solutions. Finally, CRO Ed Sztuka brings his own experience working to promote technology-based businesses, including Autotether, Inc.

The team brings an impressive amount of relevant industry experience to the company. These experiences also provide valuable network connections which will likely aid Optelos as it grows. As a result, the team score for Optelos’ is very high and is its highest score across all five metrics.

In such a competitive market, Optelos stands out with its proven solution to a highly difficult challenge. It holds a geo-visual data patent for correlation of applicable data to transform huge amounts of photo and video media into indexed digital databases. This technology enables customers to determine the condition of their assets and how those conditions are changing over time much more easily and quickly. Many competitors focus on a limited part of the asset inspection process, such as Talon Aerolytics (which provides drone-lineman pairs working together to gather inspection materials), PrecisionHawk (which offers both drone services and an analytics platform), and Kespry (which uses machine learning to better organize data captured by drone inspections). None of these competitors appear to be using digital twin technology, which is another advantage for Optelos. 

However, it is worth noting that the asset inspection market is highly competitive. Digital solutions — like what Optelos offers — are going to rapidly become the industry standard. While Optelos is an early mover in this industry shift, it will also continue to face stiff competition as it grows. The risk of another competitor developing better or cheaper technology is definitely a concern for the company. Thus, Optelos’ differentiator score is slightly above average.

Optelos has seen its revenue rise year-over-year, from $262,919 in 2018 to $363,681 in 2019. As a result of these increases, the company’s net losses have decreased as well, from $541,126 in 2018 to $309,962 last year. However, its high revenue has yet to make up for extremely high research and development costs. At the time of filing, the company has 8 months of runway. 

Additionally, Optelos has secured some impressive early customers — including AT&T as well as Accenture and Georgia-Pacific. The combination of growing revenue and strong early traction has yielded the company a high performance score.

At the present time, it seems unlikely that Optelos will fail to meet its goals. It must be noted that the company’s losses will likely continue in the near future as it ramps up its R&D and marketing, attempting to expand its access to a growing market. Optelos’s SaaS setup is also potentially vulnerable to cyberattack. The company does have some competitors, such as Pix4Dmapper and Skycatch, but these brands don’t seem to be meeting with much success. Should a strong competitor with competing software and strong marketing game emerge in the near future and steal potential customers away, Optelos could see its aggressive efforts fall short of the revenue required to make up for its overall losses. The company’s patent protection and early traction makes this eventuality unlikely.

As markets bounce back following the COVID-19 struggles and the benefits of drone technology become ever-more obvious to businesses, Optelos’s strong partnerships with drone manufacturers and other automated inspection providers makes it ideally positioned to expand into the growing market. As Optelos continues to refine its software and spread the word among industry leaders, its customer base could dramatically expand in the near future.

The advent of 5G technology in particular will require massive investments in telecom infrastructure in the near future. The team’s experience with telecom offers them advantages in securing large portions of that market, which could reach a global size of $667.9 billion by 2026.