DirecTech Labs

DirecTech Labs

Platform helping businesses better leverage their gig workers, micro-influencers, and social sellers

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Security Type
Other
Categories
Other
Min Investment
$1,000
Offering Date
August 06, 2019
Expected Close Date
November 04, 2019
Target Raise
$350.00K-$2.00M
Deal Notes

Round type: Seed

Security Type: Tiered Preferred Equity  (SWIFT)

Purchase Price: US $0.5992 before Aug 10, 2019 (15.0% discount) US $0.6697 before Aug 24, 2019 (5.0% discount) US $0.7049

Option pool: 7.0%

Liquidation preference: 1.0x

Closing conditions: While DirecTech Labs has set an overall target minimum of US $350,000 for the round, DirecTech Labs must raise at least US $25,000 of that amount through the Regulation CF portion of their raise before being able to conduct a close on any investments below $20,000. For further information please refer to DirecTech Labs's Form C.

Regulation CF cap: While DirecTech Labs is offering up to US $2,000,000 worth of securities in its Seed, only up to US $1,070,000 of that amount may be raised through Regulation CF.

Transfer restrictions: Securities issued through Regulation CF have a one year restriction on transfer from the date of purchase (except to certain qualified parties as specified under Section 4(a)(6) of the Securities Act of 1933), after which they become freely transferable. While securities issued through Regulation D are similarly considered "restricted securities" and investors must hold their securities indefinitely unless they are registered with the SEC and qualified by state authorities, or an exemption from such registration and qualification requirements is available. Raised to date: US $353,000 US $3,000 (under Reg CF only)

Valuation
$11,525,000

Company Description

Platform helping businesses better leverage their gig workers, micro-influencers, and social sellersProblem Large enterprise software providers like Salesforce, Adobe, Oracle, and SAP are vying for market share in the $189B subset of the gig economy known as direct selling.  But their systems are cramming square pegs into round holes, attempting to use the same technology that has worked for their e-commerce and retail customers in a market that we believe needs unique solutions which maximize the unique asset direct sellers have that no other go-to-market channel has to offer: personal relationships their reps have with customers.  SolutionOur product, Distro is helping customers better understand and motivate their independent reps and customers.  Using the type of AI that is already driving billions for Netflix, Facebook, Amazon, and Google, we build deep behavior profiles about a company's customers and reps.  Then we use those profiles to deliver value in two ways:We deliver behavioral insights that directly affect customer strategies, helping them create more personalized training, promotions, and communications to reps and customers that result in deeper engagement and higher LTV.We send hyper-targeted alerts to reps around the world alerting them to their customers and teammates who need their support now.  We cut our teeth on alerting (via internal company CRM, email, and text) people who Distro predicts are in the last 30 days of their lifecycle, along with some tips on how to retain the person at risk. Now we're moving into other use cases and more deeply integrating with more of our customers' sales and marketing tech.Annual contract value has nearly doubled in the last year and customers are beginning to expand their accounts with us. Over the last year, we've launched in 74 countries and quadrupled product performance and ROI for customers.  Recently a customer earned $100K in new revenue in a weekend and $1M in 75 days.

Key Deal Facts

Grew revenue over 350% in one year to 770k in 2018 (unaudited)
Quadrupled product performance for customers from a 3.28% conversion rate to 14.8% between period Oct 2017 and March 2019.
Our marquis customers (such as Plexus Worldwide, Modere, and Oriflame) are some of the largest in our first target market, with revenues up to $1.4B.
Our product, Distro is live in 70+ countries and 24 languages with over 11mm data points in our database.
Graduated from Techstars LA in 2017. Received two investments from Techstars Ventures.

Use of Proceeds

General Expenses, Development, Marketing, Team Salaries

Management Team / Advisory Board Bios

Jordan Zommick
Co-founder, CTO
From Startups to the Fortune 500, Jordan has been leading development teams to bring new technology into various industries. Most notably, Jordan led software at Las Vegas Sands, helping them scale from $1B-$30B. There he developed their loyalty and retention systems which have driven billions in new revenue.

Michel Bayan
CEO- Co-Founder
Michel has had a passion for behavioral sciences since childhood, learning from his father, a pioneer in Psycho-Acoustics. DirecTech Labs is his third venture-backed startup. The first company introduced mobile CRM to the direct and social selling market and later exited to Ebay/Stubhub.  At the second Michel led sales, marketing and product vision for another mobile company taking them from $1M to $4M ARR in 16 months.  Michel's experience in the direct selling and gig marketplace is vast. He was a Real Estate agent, shares a six figure Airbnb business with his life-partner, Chloe who has also been an Uber driver, Turo Renter, and runs an Etsy Store.  Michel has worked with many of the largest global direct selling enterprises over the past 9 years. He regularly speaks at global conferences and hosts CEOs and executives on the DirecTech Podcast. 

Deal Notes

Round type: Seed

Security Type: Tiered Preferred Equity  (SWIFT)

Purchase Price: US $0.5992 before Aug 10, 2019 (15.0% discount) US $0.6697 before Aug 24, 2019 (5.0% discount) US $0.7049

Option pool: 7.0%

Liquidation preference: 1.0x

Closing conditions: While DirecTech Labs has set an overall target minimum of US $350,000 for the round, DirecTech Labs must raise at least US $25,000 of that amount through the Regulation CF portion of their raise before being able to conduct a close on any investments below $20,000. For further information please refer to DirecTech Labs's Form C.

Regulation CF cap: While DirecTech Labs is offering up to US $2,000,000 worth of securities in its Seed, only up to US $1,070,000 of that amount may be raised through Regulation CF.

Transfer restrictions: Securities issued through Regulation CF have a one year restriction on transfer from the date of purchase (except to certain qualified parties as specified under Section 4(a)(6) of the Securities Act of 1933), after which they become freely transferable. While securities issued through Regulation D are similarly considered "restricted securities" and investors must hold their securities indefinitely unless they are registered with the SEC and qualified by state authorities, or an exemption from such registration and qualification requirements is available. Raised to date: US $353,000 US $3,000 (under Reg CF only)

Amount Raised : $650,214
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