Now Accepting Investors
- Patent-protected, state-of-the-art technology that could revolutionize the cosmetic surgery industry.
- Partnership with Mentor Worldwide, the #1 global brand of breast implants. It’s the only partnership of its kind and will drive sales and accelerate growth.
- The platform can increase sales, decrease costly reoperations, and reduce consultation time, making it a no-brainer for surgeons to adopt it.
- Launching visualizations for popular procedures such as liposuction which will add new revenue streams.
- Set for potentially rapid U.S. and international expansion. Worldwide, the top five most popular cosmestic surgeries represent an opportunity to tap 5.9 million procedures annually.
A Breakthrough That Could Become Standard In Every Cosmetic Surgical Office Worldwide
This cutting edge tool allows patients to visualize intimate details of very personal surgical decisions. It’s a breakthrough that could be quickly adopted as “best practice” for every plastic surgical office worldwide.
Mentor Worldwide is deploying their national sales team to take the lead in introducing this company’s groundbreaking technology to the medical community. Before it gains traction, you may want to consider grabbing a position.
The company is ILLUSIO. Its unique, proprietary visualization technology could revolutionize how doctors and patients interact over the most intimate details of plastic surgical procedures.
- Plastic surgeons report that the most frustrating aspect of their practice can be managing the expectations of their patients and assisting them in visualizing outcomes of procedures that each must accept and approve before surgery.
ILLUSIO technology simplifies the process and clarifies results. It allows the patient to see the range of cosmetic options available to approve in advance of the procedure.
Using state-of-the-art augmented reality (AR) and newly developed AR interfaces, ILLUSIO enables doctors to present to patients real-time, three-dimensional visualizations of body shaping procedures with detailed accuracy. Patients see on screen, on their own bodies, the range of results that can be expected from any procedure.
ILLUSIO has locked-in a global partnership with Mentor Worldwide. Mentor is the #1 global breast implant brand and a subsidiary of one of the largest medical device companies in the world. As of September 2019, ILLUSIO’s technology is being introduced to the medical community through Mentor’s extensive medical sales network.
Sales will be initially focused on breast augmentation surgeries. Imaging for breast reconstruction surgery (post-mastectomy) is in development for a future release. Together, these procedures comprise a massive, rapidly growing market. Projections are that annual growth rate of breast augmentation/reconstruction surgeries will exceed 10% CAGR, hitting $4.6 billion by 2025.
It’s an ideal time for this technology to find its way to market.
Future releases will include tummy tucks, lipo-suction and facial procedures such as lifts and nose shaping. Each procedure added to ILLUSIO’s platform creates a new potential revenue streams that could multiply sales and profits.
Since ILLUSIO technology takes the guesswork and much fear out of approving any plastic surgical procedure, the company expects it to be quickly adopted as a best practice for patient management and care.
An incremental, long overdue improvement in a massive market.
ILLUSIO’s AR visualization technology is the most advanced AR tech of its kind. Nothing else like it exists, which is why Mentor Worldwide quickly recognized ILLUSIO as a natural extension of their breast implant product line. Sales could grow quickly as a result. Mentor is the world’s leading supplier of breast implants and most cosmetic surgeons in America depend on and trust those implants for their procedures.
- ILLUSIO has opened its doors to a limited number of ground-floor investors in anticipation of rapid growth in demand for its technology.
5 Key Reasons to Consider Investing
- Patent-Protected Technology Could Revolutionize the IndustryILLUSIO is the world’s first “virtual mirror” for cosmetic surgery. Its patent-protected, state-of-the-art technology uses augmented reality to enable doctors to present patients with a real-time, three-dimensional visualization of a procedure’s potential outcome — using the patient’s actual body. Never before has this been possible. It could completely revolutionize the cosmetic surgery experience.
- Exclusive Partnership With Industry Giant, Mentor WorldwideILLUSIO has signed a global partnership Mentor Worldwide. Mentor currently sells to 85% of surgeons in the United States and will serve as the perfect entry point to plastic surgery centers in America and around the world. As part of the deal, Mentor will introduce and facilitate the sale of the ILLUSIO platform through their national sales team. Being backed by such a powerful salesforce will greatly accelerate ILLUSIO to market and could dramatically increase sales
- Rapid U.S. and International ExpansionIn 2018, there were more than 1 million cosmetic surgeries in the United States. Worldwide, there were more than 6 million. ILLUSIO could help improve all of these, presenting a major opportunity for the company. And through its partnership with Mentor, ILLUSIO is set to quickly penetrate the market with immediate access to more than 6,000 domestic surgery centers as well as an unrivaled global network.
- Major Growth Catalyst In Coming MonthsILLUSIO plans to expand its revolutionary visualization platform to cover each of the five most popular cosmetic surgeries including liposuction, tummy tucks, and facial procedures. The addition of these increase ILLUSIO’s potential market size three-fold and could be a MAJOR growth catalyst for the company.
- Every Cosmetic Surgeon Should Use ILLUSIOILLUSIO’s technology greatly improves the patient experience. It increases trust and understanding, and increases the likelihood a patient will move forward with the procedure. In fact, surgeons report surgery booking conversions increasing over 90% using the ILLUSIO breast simulation system. In addition, a recent survey found that 97% of women surveyed prefer to see a plastic surgeon using ILLUSIO and 95% who already had breast augmentation would have made different decisions if they had ILLUSIO. Overall, ILLUSIO increases sales and improves patient satisfaction, making it a no-brainer for surgeons to implement.
How to Invest
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I didn’t know that technology like this existed. This is a great way to visually get on the same page with your surgeon about what you are trying to accomplish.
– Taylor, ILLUSIO patient
Put Me At Ease
I came into my consultation unsure if I wanted to be a full C or a full D and being able to see how the different sizes would look on my body made all the difference. I was easily able to decide that the full C would be exactly what I wanted. Illusio made me feel confident in my decision.
– Sally, ILLUSIO patient
Management + Advisors
ILLUSIO is a groundbreaking medical technology platform that could revolutionize the cosmetic surgery industry. It uses state-of-the-art, augmented reality to enables doctors to present to patients a real-time, three-dimensional visualization of a procedure’s outcome using the patient’s actual body. Empowering patients to fully visualize a procedural outcome greatly improves patient experience and increases the likelihood of them moving forward with the procedure.
- Patent-protected, state-of-the-art technology that could revolutionize the cosmetic surgery industry.
- Partnership with Mentor Worldwide, the #1 global brand of breast implants. It’s the only partnership of its kind and will drive sales and accelerate growth.
- The platform can increase sales, decrease costly reoperations, and reduce consultation time, making it a no-brainer for surgeons to adopt it.
- Set for potentially rapid U.S. and international expansion.
- Launching visualizations for popular procedures such as liposuction which will add new revenue streams. The top five most popular cosmestic surgeries worldwide represent an opportunity to tap 5.9 million procedures annually.
|Offering Type||Price Per Share||Minimum||Valuation|
|Regulation CF||$1.09||$700||$15 million (pre-money)|
Initial beta software application complete
Wins Frontier Tech Showdown Startup Competition
Ray Lane joins ILLUSIO as Business Advisor
Rohit Varma / USC joins ILLUSIO as Business Advisor
ILLUSIO signs agreement with Mentor Worldwide
ILLUSIO and Mentor launch Mentor Visualizer powered by ILLUSIO
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Risks & Disclosures
An investment in our convertible notes involves a high degree of risk. You should carefully consider the risks described below before making an investment decision. If any of the following risks actually occurs, our business, financial condition or results of operations could suffer. In that case, the value of our securities could decline, and you may lose all or part of your investment.
Risks Related to the Company
Our agreement with Mentor can be terminated by Mentor at any time for any reason or for no reason upon 90 days’ notice. The termination of our agreement with Mentor would have a material adverse effect on our business and future prospects.
We have entered into an agreement with Mentor, pursuant to which Mentor is expected to promote our software through its national sales team and through its website. Mentor is the largest breast implant supplier in the United States and sells its products to 85% of plastic surgeons in the United States. We believe that our relationship with Mentor will provide us with access to several thousand potential new clients and accelerate our sales growth. Although our agreement with Mentor has a stated term of three years, it can be terminated by Mentor for convenience (for any reason or no reason) at any time upon ninety (90) days advance written notice. If Mentor terminates our agreement for convenience, then it will no longer promote our services and our access to Mentor’s sales distribution channels would be cut off. Any such termination would have a material adverse effect on our financial condition and prospects.
We have a limited operating history upon which you can evaluate our performance, and accordingly, our prospects must be considered in light of the risks that any new company encounters.
We were incorporated under the laws of the State of Delaware on February 17, 2015. We have limited operations and nominal operating revenue to date. We are in the development stage, and our future operations are subject to all of the risks inherent in the establishment of a new business enterprise. The likelihood of the success of our company must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the development of an entity in the business of developing software-as–a-service-based software, in the rapidly developing environment in which we operate. There can be no assurance that we will be able to generate revenues, that future revenues will be significant, that any sales will be profitable or that we will have sufficient funds available to complete our marketing and development programs or to market any new products which we may develop. We currently have operating losses, have no substantive source of operating revenue, are unable to self-finance operations, have limited resources, and there can be no assurance that we will be able to develop such revenue sources or that our operations will become profitable, even if we are able to commercialize our products and build brand awareness.
We have incurred operating losses in every quarter since we launched our business and may continue to incur quarterly operating losses, which could negatively affect the value of our company.
We have incurred operating losses in every quarter since we founded our business in 2015, and we may not be able to generate sufficient revenue in the future to generate operating income. We also expect our costs to increase materially in future periods, which could negatively affect our future operating results. We expect to continue to expend substantial financial and other resources on the continued development of our software solutions and our marketing efforts. The amount and timing of these costs are subject to numerous variables and such initiatives may require additional funding. If we fail to continue to grow the overall business and begin to generate substantive revenue, it could adversely affect our financial condition and results of operations.
The forecasts of market growth included in our business plan and investor presentations may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, we cannot assure you our business will grow at similar rates, if at all.
Growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. The forecasts in our business plan and investor presentations may prove to be inaccurate. Even if these markets experience the forecasted growth described in our business plan, we may not grow our business at similar rates, or at all. Our growth is subject to many factors, including our success in implementing our business strategy, which is subject to many risks and uncertainties. Accordingly, the forecasts of market growth included in our business plan should not be taken as indicative of our future growth.
Our business could be negatively impacted by cyber security threats, attacks and other disruptions.
Like others in our industry, we continue to face advanced and persistent attacks on our information infrastructure where we manage and store various proprietary information as well as sensitive and/or confidential data relating to our operations. These attacks may include sophisticated malware (viruses, worms, and other malicious software programs) and phishing emails that attack our products or otherwise exploit any security vulnerabilities. These intrusions sometimes may be zero-day malware that are difficult to identify because they are not included in the signature set of commercially available antivirus scanning programs. Experienced computer programmers and hackers may be able to penetrate our network security and misappropriate or compromise our confidential information or that of our customers or other third-parties, create system disruptions, or cause shutdowns. Additionally, sophisticated software and applications that we produce or procure from third-parties may contain defects in design or manufacture, including “bugs” and other problems that could unexpectedly interfere with the operation of the information infrastructure. A disruption, infiltration or failure of our information infrastructure systems or any of our data centers as a result of software or hardware malfunctions, computer viruses, cyber-attacks, employee theft or misuse, power disruptions, natural disasters or accidents could cause breaches of data security, loss of critical data and performance delays, which in turn could adversely affect our business.
We must acquire or develop new products, evolve existing ones, address any defects or errors, and adapt to technology change.
Technical developments, client requirements, programming languages, and industry standards change frequently in our markets. As a result, success in current markets and new markets will depend upon our ability to enhance current products, address any product defects or errors, acquire or develop and introduce new products that meet client needs, keep pace with technology changes, respond to competitive products, and achieve market acceptance. Product development requires substantial investments for research, refinement, and testing. We may not have sufficient resources to make necessary product development investments. We may experience technical or other difficulties that will delay or prevent the successful development, introduction, or implementation of new or enhanced products. We may also experience technical or other difficulties in the integration of acquired technologies into our existing platform and applications. Inability to introduce or implement new or enhanced products in a timely manner could result in loss of market share if competitors are able to provide solutions to meet customer needs before we do, give rise to unanticipated expenses related to further development or modification of acquired technologies as a result of integration issues, and adversely affect future performance.
In order for the Company to compete and grow, it must attract, recruit, retain and develop the necessary personnel who have the needed experience.
Recruiting and retaining highly qualified personnel is critical to our success. These demands may require us to hire additional personnel and will require our existing management personnel to develop additional expertise. We face intense competition for personnel. The failure to attract and retain personnel or to develop such expertise could delay or halt the development and commercialization of our product candidates. If we experience difficulties in hiring and retaining personnel in key positions, we could suffer from delays in product development, loss of customers and sales and diversion of management resources, which could adversely affect operating results. Our consultants and advisors may be employed by third parties and may have commitments under consulting or advisory contracts with third parties that may limit their availability to us.
Our business is subject to a variety of U.S. and international laws, rules, policies and other obligations regarding data protection.
We are subject to federal, state and international laws relating to the collection, use, retention, security and transfer of personally identifiable information. In many cases, these laws apply not only to third-party transactions, but also to transfers of information between us and other parties with which we may develop commercial relations. Several jurisdictions have passed recent laws in this area, and other jurisdictions are considering imposing additional restrictions. These laws continue to develop and may be inconsistent from jurisdiction to jurisdiction. Complying with emerging and changing international requirements may cause us to incur substantial costs or require us to change our business practices. Noncompliance could result in penalties or significant legal liability.
Our privacy policies and practices concerning the use and disclosure of data will be posted on our website. Any failure by us or other parties with whom we do business to comply with our posted privacy policies or with other federal, state or international privacy-related or data protection laws and regulations could result in proceedings against us by governmental entities or others, which could have a material adverse effect on our business, results of operations and financial condition.
Increased competition in our market may impede our ability to generate revenues and become profitable.
The use of software to aid visualization for surgeons in connection with elective aesthetic (plastic) surgery is relatively new and new products are being developed in this area at a fast pace. As a result, the markets for our visualization software is highly competitive. Our current competitors and potential new entrants into the market include a number of domestic and international companies, many of which have substantially greater financial, technical, marketing and distribution resources and brand name recognition than we have. We may not be able to compete successfully against either current or future competitors. Companies competing with us may introduce products that are competitively priced, have increased performance or functionality, or incorporate technological advances and may be able to react quicker to changing customer requirements and expectations. Increased competition could result in significant price erosion, inability to generate revenues, lower margins or loss of market share, any of which would significantly harm our business.
Our company may not be able to effectively manage its growth or improve its operational, financial, and management information systems, which could have a material adverse effect on our business, results of operations, and financial condition.
In the near term, our company intends to expand the scope of its operations activities significantly. If our company is successful in executing its business plan, it will experience growth in its business that could place a significant strain on its business operations, finances, management and other resources. The factors that may place strain on its resources include, but are not limited to, the following:
- The need for continued development of financial and information management systems;
- The need to manage strategic relationships and agreements with customers, advertisers and partners; and
- Difficulties in hiring and retaining skilled management, technical, and other personnel necessary to support and manage the business.
Additionally, the strategy of our company could produce a period of rapid growth that may impose a significant burden on its administrative and operational resources. Its ability to effectively manage growth will require our company to substantially expand the capabilities of its administrative and operational resources and to attract, train, manage, and retain qualified management and other personnel. There can be no assurance that our company will be successful in recruiting and retaining new employees, or retaining existing employees.
Our company cannot provide assurances that its management will be able to manage this growth effectively. Its failure to successfully manage growth could result in its sales not increasing commensurately with capital investments or could otherwise have a material adverse effect on the business, results of operations, and financial condition of our company.
Assertions by third parties of infringement, misappropriation or other violation by us of their intellectual property rights could result in significant costs and substantially harm our business and operating results.
In recent years, there has been significant litigation involving intellectual property rights in many technology-based industries. Any infringement, misappropriation or related claims, whether or not meritorious, is time-consuming, diverts technical and management personnel and is costly to resolve. As a result of any such dispute, we may have to develop non-infringing technology, pay damages, enter into royalty or licensing agreements, cease providing our products or take other actions to resolve the claims. These actions, if required, may be costly or unavailable on terms acceptable to us. Any of these events could result in increases in operating expenses, limit our product offerings or result in a loss of business.
If we do not adequately protect our intellectual property, our ability to compete could be impaired.
Our intellectual property includes the content of our software code, website, registered domain names, as well as our patent pending and unregistered trademarks. We believe that our intellectual property is an essential asset of our business and that our software code and trade secrets and our technology infrastructure currently give us a competitive advantage in the medical software visualization market. If we do not adequately protect our intellectual property, our brand, reputation and perceived value could be harmed, resulting in an impaired ability to compete effectively.
To protect our intellectual property we rely on a combination of copyright, trademark, patent and trade secret laws, contractual provisions and our user policy and restrictions on disclosure. Upon discovery of potential infringement of our intellectual property, we expect that we would promptly take action we deem appropriate to protect our rights. We also plan to enter into confidentiality agreements with our employees and consultants and seek to control access to and distribution of our proprietary information in a commercially prudent manner. The efforts we have taken to protect our intellectual property may not be sufficient or effective, and, despite these precautions, it may be possible for other parties to copy or otherwise obtain and use our intellectual property. Even if we do detect violations and decide to enforce our intellectual property rights, litigation may be necessary to enforce our rights, and any enforcement efforts we undertake could be time-consuming, expensive, distracting and result in unfavorable outcomes. A failure to protect our intellectual property in a cost-effective and meaningful manner could have a material adverse effect on our ability to compete.
Effective patent, trademark, copyright and trade secret protection may not be available in every country in which our products may be available in the future. In addition, the legal standards relating to the validity, enforceability and scope of protection of intellectual property rights are uncertain and still evolving.
We currently have an Australian Innovation Patent pending for our augmented reality imaging system for cosmetic surgical procedures, and for which we have not yet paid the required annuity and selected an annuity provider. Should we fail to do so by December 21, 2019, we may forfeit our patent in Australia.
We will need additional financing to execute our business plan, which we may not be able to secure on acceptable terms, or at all.
We will require additional financing in the near and long term to fully execute our business plan. Our success depends on our ability to raise such additional financing on reasonable terms and on a timely basis. Conditions in the economy and the financial markets may make it more difficult for us to obtain necessary additional capital or financing on acceptable terms, or at all. If we cannot secure sufficient additional financing, we may be forced to forego strategic opportunities or delay, scale back or eliminate further development of our goals and objectives, operations and investments or employ internal cost savings measures.
We plan to implement new lines of business or offer new products and services within existing lines of business.
There are substantial risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed. In developing and marketing new lines of business and/or new products and services, we may invest significant time and resources. Initial timetables for the introduction and development of new lines of business and/or new products or services may not be achieved, and price and profitability targets may not prove feasible. We may not be successful in introducing new products and services in response to industry trends or developments in technology, or those new products may not achieve market acceptance. As a result, we could lose business, be forced to price products and services on less advantageous terms to retain or attract clients, or be subject to cost increases. As a result, our business, financial condition or results of operations may be adversely affected.
Failure to adequately comply with HIPAA may result in penalties and/or an increase in our operational costs.
Most health care providers, from which we may obtain patient information, are subject to privacy regulations promulgated under HIPAA. Although we are not directly regulated by HIPAA, we could face substantial criminal penalties if we knowingly receive individually identifiable health information from a health care provider that has not satisfied HIPAA’s disclosure standards. Further, we may face civil liability if our HIPAA compliant system fails to satisfy its disclosure standards. Claims that we have violated individuals’ privacy rights or breached our contractual obligations, even if we are not found liable, could be expensive and time consuming to defend and could result in adverse publicity that could harm our business.
We believe that we meet the HIPAA requirements currently in effect that are applicable to our internal operations and our clients. However, if we are unable to deliver application solutions that achieve or maintain compliance with the applicable HIPAA rules in effect, or as they may be modified or implemented in the future, then customers may move their business to application solution providers whose systems are, or will be, HIPAA compliant. As a result, our business could suffer.
If our security measures or those of our third-party data center hosting facilities, cloud computing platform providers, or third-party service partners, are breached, and unauthorized access is obtained to a customer’s data, our data or our IT systems, our services may be perceived as not being secure, customers may curtail or stop using our services, and we may incur significant legal and financial exposure and liabilities.
Our services involve the storage and transmission of our customers’ patient’s health and other sensitive data, including personally identifiable information. Security breaches could expose us to a risk of loss of this information, litigation and possible liability. While we have security measures in place, they may be breached as a result of third-party action, including intentional misconduct by computer hackers, employee error, malfeasance or otherwise and result in someone obtaining unauthorized access to our IT systems, our customers’ data or our data, including our intellectual property and other confidential business information. Additionally, third parties may attempt to fraudulently induce employees or customers into disclosing sensitive information such as user names, passwords or other information in order to gain access to our customers’ data, our data or our IT systems. Because the techniques used to obtain unauthorized access, or to sabotage systems, change frequently and generally are not recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures. In addition, our customers may authorize third-party technology providers to access their customer data, and some of our customers may not have adequate security measures in place to protect their data that is stored on our services. Because we do not control our customers or third-party technology providers, or the processing of such data by third-party technology providers, we cannot ensure the integrity or security of such transmissions or processing. Malicious third parties may also conduct attacks designed to temporarily deny customers access to our systems and supporting services. Any security breach could result in a loss of confidence in the security of our software, damage our reputation, negatively impact our future sales, disrupt our business and lead to legal liability.
If we are unable to properly protect the privacy and security of protected health information entrusted to us, we could be found to have breached our contracts with our customers and be subject to investigation by the U.S. Department of Health and Human Services, or HHS, Office for Civil Rights, or OCR. In the event OCR finds that we have failed to comply with applicable HIPAA privacy and security standards, we could face civil and criminal penalties. In addition, OCR performs compliance audits of Covered Entities and Business Associates in order to proactively enforce the HIPAA privacy and security standards. OCR has become an increasingly active regulator and has signaled its intention to continue this trend. OCR has the discretion to impose penalties without being required to attempt to resolve violations through informal means; further OCR may require companies to enter into resolution agreements and corrective action plans which impose ongoing compliance requirements. OCR enforcement activity can result in financial liability and reputational harm, and responses to such enforcement activity can consume significant internal resources. In addition to enforcement by OCR, state attorneys generally are authorized to bring civil actions under either HIPAA or relevant state laws seeking either injunctions or damages in response to violations that threaten the privacy of state residents. Although we have implemented and maintain policies and processes to assist us in complying with these laws and regulations and our contractual obligations, we cannot provide assurance regarding how these laws and regulations will be interpreted, enforced or applied to our operations. In addition to the risks associated with enforcement activities and potential contractual liabilities, our ongoing efforts to comply with evolving laws and regulations at the federal and state levels also might require us to make costly system purchases and/or modifications or otherwise divert significant resources to HIPAA compliance initiatives from time to time.
Security breaches and improper access to or disclosure of our data or user data, or other hacking and phishing attacks on our systems, could harm our reputation and adversely affect our business.
Many industries are prone to cyber-attacks, including ours, with third parties seeking unauthorized access to our data or users’ data. Any failure to prevent or mitigate security breaches and improper access to or disclosure of our data or user data could result in the loss or misuse of such data, which could harm our business and reputation and diminish our competitive position. In addition, computer malware, viruses, and hacking and phishing attacks by third parties have become more prevalent in many industries and may occur on our systems in the future. Such attacks may cause interruptions to the products we provide, degrade our customers’ experience, cause customers to lose confidence in our products, or result in financial harm to us. Our efforts, or those used by our strategic partners and licensees to protect our company data or the information we receive may also be unsuccessful due to software bugs or other technical malfunctions, employee error or malfeasance, government surveillance, or other factors. In addition, third parties may attempt to fraudulently induce employees or users to disclose information in order to gain access to our data or our customers’ data. Although we have developed systems and processes that are designed to protect our data and customer data and to prevent data loss and other security breaches, we cannot assure you that such measures will provide absolute security.
A failure to protect the integrity and security of our end-user’s information could expose us to litigation, materially damage our reputation and harm our business. Furthermore, the unanticipated costs of protecting against such a failure could adversely affect our results of operations.
Our business involves the collection and use of confidential information of our end-users and vendors. We cannot assure you that our efforts to protect this confidential information will be successful. If any compromise of this information security were to occur, we could be subject to legal claims and government action, experience an adverse effect on our reputation and need to incur significant additional costs to protect against similar information security breaches in the future, each of which could adversely affect our financial condition, results of operations and growth prospects. In addition, because of the critical nature of data security, any perceived breach of our security measures could cause existing or potential customers not to use our products and could harm our reputation.
The Company’s success depends on the experience and skill of the board of directors, the management team, its executive officers and key employees.
In particular, the Company is dependent on Ethan Winner and Dipak Panigrahi to execute the business strategy and business plan, and to manage any employees and consultants. As the Company grows, a corporate body of knowledge will be produced and taught to other employees in order to facilitate growth. As this happens, any change in management’s ability to operate the business due to disability, illness, or for any other reason, would cause a significant loss in production capability, which would have a material adverse effect on the Company’s business and prospects.
The Company has or intends to enter into employment agreements with Ethan Winner and Dipak Panigrahi although there can be no assurance that it will do so or that they will continue to be employed by the Company for a particular period of time. The loss any of the founders could harm the Company’s business, financial condition, cash flow and results of operations.
Although dependent on certain key personnel, we do not have any key man life insurance policies on any such people.
We are dependent on Ethan Winner and Dipak Panigrahi in order to conduct our operations and execute our business plan, however, we have not purchased any insurance policies with respect to those individuals in the event of their death or disability. Therefore, if either of them were to die or become disabled, we will not receive any compensation to assist with such person’s absence. The loss of either such person could negatively affect our company and its operations.
Reductions in demand for elective aesthetic services and related products will have an adverse effect on our profitability and ability to generate cash to fund our business plan.
The following factors, among others, could affect continued market acceptance and profitability of our future products:
- the introduction of competitive services;
- changes in consumer preferences among elective aesthetic products and services;
- changes in consumer perception about trendy products;
- changes in consumer perception regarding the healthfulness of elective aesthetic products;
- the level and effectiveness of our marketing efforts;
- any unfavorable publicity regarding our products or services or similar products or services;
- any unfavorable publicity regarding our brand;
- litigation or threats of litigation with respect to our services;
- any changes in government policies and practices related to our products or services, and markets;
- regulatory developments affecting the marketing or use of our products and services;
- new science or research that disputes the healthfulness of elective aesthetic surgery; and
- adverse decisions or rulings limiting our ability to promote the benefits of our products and services.
Adverse developments with respect sales of elective aesthetic products and services would indirectly reduce our user base and profitability and have a material adverse effect on our ability to maintain profitability and achieve our business plan.
We plan to obtain insurance that may not provide adequate levels of coverage against claims.
We plan to obtain insurance customary for businesses of our size and type. However, there are types of losses we may incur that cannot be insured against or that we believe are not economically reasonable to insure. Such losses could have a material adverse effect on our business and results of operations.
Establishing, maintaining, extending and expanding our reputation and brand image are essential to our business success.
We plan to establish, maintain, extend, and expand our brand image through marketing investments, including advertising and consumer promotions. Increasing attention on marketing could adversely affect our brand image. It could also lead to stricter regulations and greater scrutiny of marketing practices. Existing or increased legal or regulatory restrictions on our advertising, consumer promotions and marketing, or our response to those restrictions, could limit our efforts to maintain, extend and expand our brands. Moreover, adverse publicity about regulatory or legal action against us could damage our reputation and brand image, undermine our customers’ confidence and reduce long-term demand for our products, even if the regulatory or legal action is unfounded or not material to our operations.
In addition, our success in establishing, maintaining, extending, and expanding our brand image depends on our ability to adapt to a rapidly changing media environment. We increasingly rely on social media and online dissemination of advertising campaigns. The growing use of social and digital media increases the speed and extent that information or misinformation and opinions can be shared. Negative posts or comments about us, our brands or products marketed on our platform or on social or digital media, whether or not valid, could seriously damage our brands and reputation. If we do not establish, maintain, extend and expand our brand image, then our financial condition and results of operations could be adversely affected.
Risks Related to the Company’s Securities and this Offering
We have indebtedness outstanding. Some of this indebtedness has already matured and we were unable to repay our obligations under the matured indebtedness. Holders of such matured debt may bring legal action against us, including potentially in bankruptcy court.
As of the date of this offering statement, we had indebtedness outstanding of approximately $770,000. This indebtedness is in the form of convertible notes that mature on various dates. Some of the notes have already matured and we were unable to repay the obligations due under such matured notes. Any proceeds of the offering that are utilized to repay existing indebtedness will not be available for other working capital or other purposes. In addition, since some of the notes have already matured and were not paid, the holders of such notes may take legal action against us, including potential action in bankruptcy.
The securities will also be subordinate to the repayment obligation to outstanding senior secured convertible promissory notes issued by us in the aggregate principal amount of $400,000. The holders of these notes upon default could foreclose on all of our assets that secure our obligations under the notes and cause the securities to have no economic value.
Affiliates of our company, including officers, directors and existing stockholder of our company, may invest in this offering and their funds will be counted toward our achieving the minimum amount.
There is no restriction on our affiliates, including our officers, directors and existing stockholders, investing in the offering. As a result, it is possible that if we have raised some funds, but not reached the minimum amount, affiliates can contribute the balance so that there will be a closing. The minimum amount is typically intended to be a protection for investors and gives investors confidence that other investors, along with them, are sufficiently interested in the offering and our company and its prospects to make an investment of at least the minimum amount. By permitting affiliates to invest in the offering and make up any shortfall between what non-affiliate investors have invested and the minimum amount, this protection is largely eliminated. Investors should be aware that no funds other than their own and those of affiliates investing along with them, may be invested in this offering.
We intend to use some of the proceeds from the offering for unspecified working capital.
This means that we have ultimate discretion to use this portion of the proceeds as we see fit and have chosen not to set forth any specific uses for you to evaluate. The net proceeds from this offering will be used for the purposes, which our management deems to be in our best interests in order to address changed circumstances or opportunities. As a result of the foregoing, our success will be substantially dependent upon our discretion and judgment with respect to application and allocation of the net proceeds of this offering. We may choose to use the proceeds in a manner that you do not agree with and you will have no recourse. A use of proceeds that does not further our business and goals could harm our company and its operations and ultimately cause you to lose all or a portion of your investment.
We are subject to income taxes as well as non-income-based taxes, such as payroll, sales, use, value-added, net worth, property and goods and services taxes, in both the U.S. and foreign jurisdictions.
Significant judgment is required in determining our provision for income taxes and other tax liabilities. In the ordinary course of our business, there are many transactions and calculations where the ultimate tax determination is uncertain. Although we believe that our tax estimates are reasonable: (i) there is no assurance that the final determination of tax audits or tax disputes will not be different from what is reflected in our income tax provisions, expense amounts for non-income based taxes and accruals; and (ii) any material differences could have an adverse effect on our financial position and results of operations in the period or periods for which determination is made.
We are not subject to Sarbanes-Oxley regulations and lack the financial controls and safeguards required of public companies.
We do not have the internal infrastructure necessary, and are not required, to complete an attestation about our financial controls that would be required under Section 404 of the Sarbanes-Oxley Act of 2002. There can be no assurance that there are no significant deficiencies or material weaknesses in the quality of our financial controls. We expect to incur additional expenses and diversion of management’s time if and when it becomes necessary to perform the system and process evaluation, testing and remediation required in order to comply with the management certification and auditor attestation requirements.
The securities being sold in this offering will not be freely tradable until one year from the initial purchase date. Although our securities may be tradable under federal securities law, state securities regulations may apply, and each investor should consult with his or her attorney.
You should be aware of the long-term nature of this investment. There is not now and likely will not be a public market for our securities. Because our securities have not been registered under the Securities Act or under the securities laws of any state or non-United States jurisdiction, our securities have transfer restrictions and cannot be resold in the United States except pursuant to Rule 501 of Regulation CF. It is not currently contemplated that registration under the Securities Act or other securities laws will be effected. Limitations on the transfer of the securities may also adversely affect the price that you might be able to obtain for our securities in a private sale. Investors should be aware of the long-term nature of their investment in the Company. Each investor in this offering will be required to represent that it is purchasing the securities for its own account, for investment purposes and not with a view to resale or distribution thereof.
Neither the offering nor the securities have been registered under federal or state securities laws, leading to an absence of certain regulation applicable to us.
No governmental agency has reviewed or passed upon this offering, our company or any Securities of our company. We also have relied on exemptions from securities registration requirements under applicable state securities laws. Investors, therefore, will not receive any of the benefits that such registration would otherwise provide. Prospective investors must therefore assess the adequacy of disclosure and the fairness of the terms of this offering on their own or in conjunction with their personal advisors.
No Guarantee of Return on Investment
There is no assurance that an investor will realize a return on its investment or that it will not lose its entire investment. For this reason, each investor should read the Form C and all Exhibits carefully and should consult with its own attorney and business advisor prior to making any investment decision.
A majority of our company is owned by a small number of owners.
Prior to the offering our officers, directors and those of our stockholders who own ten percent or more of our securities collectively over 50% of our company. Subject to any fiduciary duties owed to our other owners or investors under Delaware law in the case of our officers and directors, these stockholders may be able to exercise significant influence over matters requiring owner approval, including the election of directors or managers and approval of significant company transactions, and will have significant control over our management and policies. These control persons may have interests that are different from yours. For example, they may support proposals and actions with which you may disagree. The concentration of ownership could delay or prevent a change in control of our company or otherwise discourage a potential acquirer from attempting to obtain control of the Company, which in turn could reduce the price potential investors are willing to pay for our company. In addition, this owner could use his voting influence to maintain the Company’s existing management, delay or prevent changes in control of our company, or support or reject other management and board proposals that are subject to owner approval.
We have the right to extend the offering deadline.
We may extend the offering deadline beyond what is currently stated herein. This means that your investment may continue to be held in escrow while we attempt to raise the minimum amount even after the offering deadline stated in this offering statement is reached. Your investment will not be accruing interest during this time and will simply be held until such time as the new offering deadline is reached without our company receiving the minimum amount, at which time committed funds will become immediately available for withdrawal from the investor’s brokerage account maintained with the Intermediary without interest or deduction, or until we receive the minimum amount, at which time it will be released to us to be used as set forth herein. Upon or shortly after release of such funds to us, the securities will be issued and distributed to you.
Your ownership of the shares will be subject to dilution.
If we conduct subsequent offerings of securities, issue shares pursuant to a compensation or distribution reinvestment plan or otherwise issues additional shares, investors who purchase securities in this offering who do not participate in those other stock issuances will experience dilution in their percentage ownership of our company’s outstanding shares. Furthermore, shareholders may experience a dilution in the value of their underlying shares depending on the terms and pricing of any future share issuances (including the underlying shares being sold in this offering) and the value of our assets at the time of issuance.
Management has discretion over proceeds of this offering.
We expect to use the net proceeds of this offering, over time, for general marketing and advertising, leasing costs, debt repayment and general working capital. However, we have no current specific plans for the net proceeds of this offering other than as outlined in the use of proceeds section of this offering statement. As a result, our management will have the discretion to allocate the net proceeds to uses that investors may not deem desirable. There can be no assurance that the net proceeds can or will be invested to yield a significant return.
The securities will be equity interests in our company and will not constitute indebtedness.
The securities will rank junior to all existing and future indebtedness and other non-equity claims on our company with respect to assets available to satisfy claims on the Company, including in a liquidation of our company. Additionally, unlike indebtedness, for which principal and interest would customarily be payable on specified due dates, there will be no specified payments of dividends with respect to the securities and dividends are payable only if, when and as authorized and declared by us and depend on, among other matters, our historical and projected results of operations, liquidity, cash flows, capital levels, financial condition, debt service requirements and other cash needs, financing covenants, applicable state law, federal and state regulatory prohibitions and other restrictions and any other factors our board of directors deems relevant at the time. In addition, there is no limit on the amount of debt or other obligations we may incur in the future. Accordingly, we may incur substantial amounts of additional debt and other obligations that will rank senior to the securities, which are the most junior securities of our company.
There can be no assurance that we will ever provide liquidity to investors through either a sale of our company or a registration of the securities.
There can be no assurance that any form of merger, combination, or sale of our company will take place, or that any merger, combination, or sale would provide liquidity for investors. Furthermore, we may be unable to register the securities for resale by investors for legal, commercial, regulatory, market-related or other reasons. In the event that we are unable to effect a registration, investors could be unable to sell their securities unless an exemption from registration is available.
The offering price in this offering may not represent the value of our securities.
The price of the securities being sold in this offering has been determined based on a number of factors and does not necessarily bear any relationship to our book value, assets, operating results or any other established criteria of value. Prices for our securities may not be indicative of the fair market value of our securities now or in the future.