Management’s Discussion and Analysis of Financial Condition and Results of OperationsYou 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.Overview
We lower the barrier for early stage deep tech companies to move faster and cost effectively in the patent process. We are a force multiplier for companies tackling everything from cancer to climate change to COVID-19. The slow process of IP (intellectual property) should never slow down companies tackling the crisis in getting products out as they pivot to help.
As part of re-thinking the patent system, we will be creating an open source platform for COVID-19 solutions to be shared.
The patent system is 200+ yrs old and doesn't reflect much of innovation today. Patenting software is often pointless and for deep tech, it requires huge budgets to even enforce those patents.
Inventr wants to change how we think about IP and patents entirely with an alternative system, as opposed to replacing it, with a focus on collaboration and licensing to reduce litigation. More than $50B is spent on IP protection and licensing annually - this is the market we can capture.
Given the Company’s limited operating history, the Company cannot reliably estimate how much revenue it will receive in the future, if any.MilestonesEureka Analytics Inc. was incorporated in the State of Delaware in May 2015.Since then, we have:
- We've gotten 30+ LOIs from companies funded by YC, DCVC, StartX, Techstars, and more.
- It is a $50B opportunity around IP, starting with the $1B market of early-stage deep tech companies.
- Founding team is experts in neural engineering & NLP. Worked in companies including Google & Amazon.
- The patent system is archaic and broken. It reflects innovation of 200+ years ago.
- Inventr is being used by the US Patent and Trademark Office as part of the Patent Pro Bono Program.
Historical Results of Operations
- Revenues & Gross Margin. For the period ended December 31, 2019, the Company had revenues of $2875 compared to the year ended December 31, 2018, when the Company had revenues of $18,000.
- Assets. As of December 31, 2019, the Company had total assets of $40,000, including $40,000 in cash. As of December 31, 2018, the Company had $15,000 in total assets, including $15,000 in cash.
- Net Loss. The Company has had net losses of $11,500 and net losses of $6,000 for the fiscal years ended December 31, 2019 and December 31, 2018, respectively.
- Liabilities. The Company's liabilities totaled $0 for the fiscal year ended December 31, 2019 and $0 for the fiscal year ended December 31, 2018.
Related Party TransactionRefer to Question 26 of this Form C for disclosure of all related party transactions.Liquidity & Capital ResourcesTo-date, the company has been financed with $95,000 in SAFEs.After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 12 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 6 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 ExpensesEureka Analytics Inc. cash in hand is $20,000, as of July 2020. Over the last three months, revenues have averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $7,500/month, for an average burn rate of $7,500 per month. Our intent is to be profitable in 6 months.
There are no material changes or trends that have occurred in finances or operations since the date our financials cover (end of 2019).
6 months after the Wefunder raise we expect (although cannot guarantee) $50K in monthly recurring revenue and $35k in monthly expenses. We hope to begin generating revenues in August 2020, as we have some trial customers who may convert to paying by then.
We received $100K in Google Cloud credits to reduce all hosting expenses for 12 months (expires 4/2021). While we hope to raise additional funds, we do not need to in order to begin generating revenue.
