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DREAMS AREN'T THIS GOOD.™

The first lifestyle salsa brand
Social Impact Food B2C B2B CPG
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Documents

Republic (OpenDeal Portal LLC, CRD #283874) is hosting this Reg CF securities offering by DATG group, llc. View the official SEC filing and all updates:
Official SEC Logo Form C SEC.gov
Company documents
DREAMS AREN'T THIS GOOD.™ Crowd SAFE DATG Form C:A.pdf DATG Form C.pdf
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Highlights


  • Premium chips and salsa designed for experience and lifestyle
  • Margins range from 20~70% via multiple retail channels since product launch
  • 300+ retail partnerships in only two years
  • 333% revenue growth since launch from 2019 to 2020
  • Pre-made Salsa market worth $1.4B+, Tortilla Chips market worth $22B+
  • Unique social good strategy donating $.05 per jar/bag sold
  • Taste Test before you Invest @ http://republic.dreamsarentthisgood.com

Problem


Consumers are changing, brands are not

When walking into any store in any city, people are not excited about the salsa selections they see on the shelf. From the lack of loyalty to the misses on marketing, salsa brands are "stale." And while the industry continues to grow, it's also slow to diversify its approach and ripe for someone to "dip in!"

Not one salsa brand in recent history has revolutionized one of the largest consumer product markets in the world. There's never been a "Red Bull x Ben & Jerry's x Apple" of salsa — from making it bigger than the product by marketing lifestyle (energy drinks) to creating community-inspired flavors and change through causes (ice cream) to thinking differently through design (tech) — these three companies completely changed the way people experience billion-dollar brands.

Solution


Build the first lifestyle salsa brand

Brand identity

Dreams Aren't This Good (DATG) is a lifestyle brand that leads our own unique style and is purposefully designed to create energetic and emotional connections with our consumers. We are viewed as a clean x cool, modern x minimalistic brand that fits artistic, active, and aspirational cultures.

Brand position

DATG positions itself as one that encompasses urban city life to coastal-chillin, and outdoor adventures to on-the-go.

Brand execution

DATG uses local relationship building, guerrilla marketing, and compelling content as our main source of marketing. In addition, we drive our in-store presence with primed and unparalleled POS. We also support with limited flavor “drops,” further driving our brand forward!

Brand system

DATG products are firstly designed to match the needs of the target market and produced in low quantities. The latest flavors are then promoted and released to drive awareness, sales, and brand “buy-in.” Once the new flavor is on track to sell out, we move into launch mode, making it a full on “Fantasy Flavor” available everywhere.

Brand leverage

DATG has successfully expanded our brand by creating complementary lifestyle products. We design “fresh” apparel, produce pulse-pounding parties, create content that connects with our community, and donate dollars to make a difference for our flavor partners.

Brand tracking

DATG brand equity and loyalty of our customers is shown by the fact that we have created a “cartel-like" following with our consumers (cartel = community for good).

Brand responsibility

DATG ensures that the connection between the brand and the consumer is strong by leading our own style and adopting it with artistic, active and aspirational cultures. We do not follow the conventional rules, therefore making us unique in comparison to mainstream brands. Along with this, our products are infused & inspired by culture that creates a bond between the consumer and the brand.

Brand investment

DATG has invested heavily in the brand by betting on creative, clean content and packaging, fresh flavors and top level talent to execute on the DATG vision.  

The Original Race

Product


Born on the Bayou, perfected in the Big Apple, we combine flavors of the South with sounds & styles of the city that never sleeps

We pour our passion into creating the best products on the planet. Focused on flavors, not heat levels, we start everything with a feeling...inspired by NYC musicians' songs bumping in our earbuds mixed with the colors that connect NYC's subways. We then combine the inspiration with fresh and clean ingredients that free your mind and feed your tastebuds. Lastly, with each flavor created as an experience, we pair it with philanthropy that embodies the "spirit" of the flavor and donate $.05 per jar/bag sold.

Our salsas are the stars of the show and perfectly partnered by our authentic Mexican-style tortilla chips, with black magic bagging. And now, with a one-of-a-kind ovenable chip bag, everyone can enjoy the ultimate DATG experience: fresh, warm restaurant-style chips and chilled salsa!

Traction


Secured 300+ partnerships in  2 years

Our main footprint focus has been to grow with brand-depth deep in our backyard (the Northeast) before hitting other parts of the country/world. We currently have partnerships with ShopRite, Fairway Market, Westside Market, Key Food, Foodtown, Brooklyn Harvest, Foragers, and many more. In addition to our own website, we've added wholesale and DTC online partnerships with companies such as Amazon, Faire, and SnackMagic. Our revenue has grown from $30K (2019) to $130K (*2020).

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*Covid-resilient

The Hero Fighter

Customers


When the Cartel speaks, we listen

Demographic

DATG’s target consumer is 25-45 years old, values quality, experiences, making a difference, and lives an aspirational lifestyle.

Psychographic

DATG’s target consumer has interests in everything — from food to fashion, art to adventure, and tech to travel, while very much sharing inspiration via social media.

Geographic

DATG’s target consumer lives everywhere from urban cities to under-the-radar coastal towns, and outside the city lines to outdoor mountain tops.

Buying behavior

DATG’s target consumers want to appear in-the-know and inclusive, while maintaining individual style. People buy from DATG as a form of fulfillment, self-accomplishment, and personal growth because they believe that purchasing a product from an inclusive, inspirational, and impacting brand gives them the opportunity to be part of something bigger than themselves.

Best, Freshest Salsa! 
By far the BEST salsa I’ve ever had. It amazes me how FRESH, and light this tastes, out of a jar — it tastes and feels like it was just made in the kitchen. The original is my favorite, although I’ve tried 3 flavors and they are all amazing.

I had the opportunity to try this for the first time, as a taste test in a small grocery store in Williamsburg, Brooklyn. The owner himself was giving out samples, and I just planned to stop in for something quick in the store and run out. The owner got my attention for a taste test, and I was like, “yeah, sure, I’ll try a bite of your salsa,” but really expected to just have a taste and continue in my way. I literally stopped in my tracks and decided to buy 3 jars — it was SO good!

I can promise you won’t be disappointed. So happy to see they sell it on Amazon now, it can be hard to find in grocery stores.

Five Stars!
The creative label sold me. I purchased this as a gift for somebody who loves salsa, and knowing they are extremely picky I decided to just go with a cute label in case they hated it. However the recipient said it was one of the best salsas they’ve ever had!

Among the best!
Hands down among the best salsa I've tasted right out of a jar! Definitely has a kick, but it's just right. My wife, who admits to having a low threshold for spice, loves this brand as much as I do. I've given away a few jars to friends, and also served the salsa at gatherings, and everyone is super impressed and always going back for more! I've read some reviews calling this a bland salsa; we all have different tastes, but I can say for sure that's the last word I'd use for this superb and tasty salsa! Nicely done, DATG!

So Amazing!
The blueberry coconut has a slightly gritty texture, despite how strange it sounds it tastes incredible. The jalapeño pineapple flavor was a thinner salsa...similar to restaurant style. I absolutely loved them both. Neither were overly spicy...and were empty within 24 hours of opening.

Only read if you are looking for the best salsa ever...
I had received a jar of this in a gift package earlier this year and found it to be the best salsa I have ever had out of a jar and even most Mexican or Tex-Mex restaurants I have eaten at. I was elated to find out that this salsa was available through Amazon....and a three pack to boot!  If you are a foodie like I am always looking for the best taste, please give this salsa a try.  It is so good.  I see that there are other varieties and maybe one day I will try them, but The Original is so tasty. Also read the label of ingredients....no preservatives or words that you cannot pronounce. I am addicted to it and use it with chips, vegetables, tacos, on top of a hamburger, and on and on. The jars of deliciousness are shipped in a well-protected attractive looking box, so nice that it would make a great gift. I also want to make it very clear that I did not receive this as a promotion (although I would be more than happy to become an official taste tester!!!), I paid for this product because I love salsa and I have finally found the perfect salsa. Thank you Dreams Aren’t This Good!

Must buy!!!
The best salsa you will ever have!!! This is truly authentic!! I have searched everywhere for this salsa and I’m so glad I found it. Definitely a must buy!! Trust me you won’t regret it!

   Thank you!
Thank you guys as always, best salsa in the world, can’t even eat anything else. Had to order the NYC Pack!

   Simply the best!
These are the best chips I have ever had! Hands down. Popped them in the oven too! The salsa is crazy good also.

   These are GREAT chips!
If you miss getting fresh chips from the local Mexican restaurant because of COVID, stop reading and get these. These are ridiculously great restaurant style chips. The flavor, salt and texture are spot on. If you go to a Mexican place that has thin chips that they serve for an appetizer and thicker chips that they use for nachos, these are the thicker chips. I don't know if the packaging (which was bags with padding in a cardboard box) or the thickness kept the chips intact but they were surprisingly not crushed. The instructions suggest an oven for the best possible chips. Do it....I just ordered the salsa to go with these. I am such a happy customer.

Business model


Focus on flavors and philanthropy drive brand difference through experience

The "Four Ps" create our baseline (Place, Price, Product, Promotion); but it's our music-inspired Fantasy Flavors that make the headlines. We offer one of the freshest "clean-label + shelf-stable" chips and salsa on the market, create content and packaging that connects with consumers, and donate $.05 per jar/bag sold to our flavor partners. Between stores, wholesale, and DTC online (plus events), we hit margins of 20%-70% depending on the channels connecting us to consumers.

$.05 donated per jar/bag sold goes to our flavor partners

We partner with leading philanthropies that pair well with our products, company, community, and brand. We do this by amplifying their message, encouraging others to get involved, and even “recycling customer's money to make a difference” through our give-back programs.

We also donate through apparel sales, events, and combined marketing efforts. We believe that with our shared DNA and drive to always be part of the solution that fuels us moving forward, there are limitless possibilities in bringing our brands together!

Just Dance "The Party"

Market


Infuse ourselves into industries where no other brands can play, due to lack of sharing "Brand DNA"

We operate in the categories of pre-made salsa ($1.4B) and tortilla chips ($22B).  And with salsa being the #1 condiment in the US, we are flipping the model by focusing on our "display where consumers play" approach, creating strategic and authentic growth opportunities through out-of-the-box verticals — everywhere from craft beer breweries to boutique hotels, music-making recording studios to fashion-forward runway shows, and sunburnt surf shops to snow-covered ski slopes and sold-out soccer stadiums.

These are our current partners, and we're just getting started...

Competition


Innovation & inspiration create unwavering connection with consumers


We deliver our products to market through creative content, custom packaging, and unparalleled POS. Whether it's our epic and emotion-creating flavor composites, our ovenable chip bag, or our one-of-a-kind marketing, we have unique, creative, and cost-effective ways to connect with consumers and communities seeking something great than just a product — a lifestyle.

DATG Dream Machine + DATG Cloud Car: the beginning of branded salsa slinging vehicles is here. Whether it's scouring the streets hitting stores, setting up at sud-soaked beer/music festivals, or dropping product to our partners, our fleet of Dream Machines (Jeep) and Cloud Cars (VW) gives us the opportunity to deliver in style!

It's Now or Never

Vision and strategy


To be the most preferred, most famous salsa in the world

We'll accomplish our incredible vision by increasing our distribution and sales channels across regions worldwide and expanding online availability, enabling consumers to more easily purchase the products they desire. We also plan to heavily invest in our people and production (both on content and product sides) to increase awareness and create connections with our community through our group of company pillars: DATG Food, DATG Fashion, DATG Festival, DATG Films, and the DATG Foundation.  All of this will further enable greater brand differentiation as we continue our takeover!

Funding


From bootstrapping to breaking through the clutter, raised $300K to date

Your investment will be invested into growing our team, increasing our product inventory to meet demand, elevating marketing efforts, creating more effective and efficient operations, driving deeper brand growth in our backyard, and starting the expansion of our footprint into strategic markets (cities) across the country. As of July 2021, funding to date ($300K) has come from friends, family, and our Founder.

Our small, yet super smart and scrappy team has been built strategically and for scale — focused on talent, awareness, teamwork, and adaptability. We always bet on creativity first, to clearly differentiate our forward-thinking take on our brand, and then support growth with streamlined sales technology and transparency throughout our team, partners, and now, you.

We believe in each other, we challenge each other, and we support each other. We move fast and make things happen. We help people. We work our a**** off and we play our a**** off! We create and build. We love what we do and that it's not easy. We serve our community. And, we know that dreams aren't this good.

Strong Girls Girls Girls

Founders


Matt "Beniteaux" Bennett

From the great state of Texas, where salsa is king, to the bright lights of the big city, I am taking a dip into the salsa space, starting in the most unlikely of places: New York City!

Having been the founder or core team member of three previous startups, I have decided to take on my next venture — one that has been burning inside me since my college days at LSU — with a laser-focused relentlessness. Being half dreamer, half doer, I have the uncanny ability to manifest things into reality, as if the road to success were already paved.

The ultimate connector, creator and believer in anything is possible, I maintain awareness of what I am great at and what I am not, bringing together top talent to execute the DATG vision.

My life experiences of travel, business and relationships paired with my passion for products and people come together here, where I lead the way to create a new type of salsa brand!

For further insight, we invite you to visit us at dreamsarentthisgood.com and @datgcartel.

Taste Test before you Invest.


Welcome to the Family!

Deal terms


Valuation cap

$5,000,000

The maximum valuation at which your investment converts into equity shares or cash.
Learn more

Discount

20%

If a trigger event for DREAMS AREN'T THIS GOOD.™ occurs, the discount provision gives investors equity shares (or equal value in cash) at a reduced price.
Learn more.

Minimum investment

$100

The smallest investment amount that DREAMS AREN'T THIS GOOD.™ is accepting.
Learn more

Funding goal

$1.07M

DREAMS AREN'T THIS GOOD.™ must achieve its minimum goal of $25K before the deadline. The maximum amount the offering can raise is $1.07M.
Learn more

Deadline
DREAMS AREN'T THIS GOOD.™ needs to reach their minimum funding goal before the deadline ( ). If they don’t, all investments will be refunded.
Learn more
Type of security

Crowd SAFE

A SAFE allows an investor to make a cash investment in a company, with rights to receive certain company stock at a later date, in connection with a specific event. · Learn more

How it works

Documents

Republic (OpenDeal Portal LLC, CRD #283874) is hosting this Reg CF securities offering by DATG group, llc. View the official SEC filing and all updates:
Official SEC Logo Form C SEC.gov
Company documents
DREAMS AREN'T THIS GOOD.™ Crowd SAFE DATG Form C:A.pdf DATG Form C.pdf

Bonus perks

In addition to your Crowd SAFE, you'll receive perks for investing in DREAMS AREN'T THIS GOOD.™.
Invest
$100
Receive
  • ☁️Shout out on social
Invest
$250
Receive
  • ☁️Shout-out on social ☁️DATG Swag
Invest
$500
Receive
  • ☁️Shout-out on social ☁️DATG Fashion Apparel
Invest
$1,000
Receive
  • ☁️Shout-out on social ☁️DATG Fashion Apparel + Swag
Invest
$5,000
Receive
  • ☁️Shout-out on social ☁️1 month worth of DATG Food (Chips and Salsa) ☁️5% off all DATG Products Forever ☁️DATG Fashion Apparel + Swag ☁️Feature as part of our People Project ☁️2 tickets to DATG Festival
  • Limited (500 left of 500)
Invest
$10,000
Receive
  • ☁️Shout-out on social ☁️3 months worth of DATG Food (Chips and Salsa) ☁️10% off all Products Forever ☁️DATG Fashion Apparel + Swag ☁️Feature as part of our People Project ☁️4 tickets to DATG Festival
  • Limited (250 left of 250)
Invest
$25,000
Receive
  • ☁️Shout-out on social ☁️6 months worth of DATG Food (Chips and Salsa) ☁️15% off all Products Forever ☁️DATG Fashion Apparel + Swag ☁️Feature as part of our People Project ☁️6 tickets to DATG Festival
  • Limited (100 left of 100)
Invest
$50,000
Receive
  • ☁️Shout-out on social ☁️9 months worth of DATG Food (Chips and Salsa) ☁️20% off all Products Forever ☁️DATG Fashion Apparel + Swag ☁️Feature as part of our People Project ☁️8 tickets to DATG Festival
  • Limited (10 left of 10)
Invest
$100,000
Receive
  • ☁️Shout-out on social ☁️12 months worth of DATG Food (Chips and Salsa) ☁️25% off all Products Forever ☁️DATG Fashion Apparel + Swag ☁️Feature as part of our People Project ☁️10 tickets to DATG Festival
  • Limited (5 left of 5)
Invest
$250,000
Receive
  • ☁️Shout-out on social ☁️18 months worth of DATG Food (Chips and Salsa) ☁️25% off all Products Forever ☁️DATG Fashion Apparel + Swag ☁️Feature as part of our People Project ☁️12 tickets to DATG Festival ☁️Cameo appearance in a future DATG Film
  • Limited (2 left of 2)
Invest
$500,000
Receive
  • ☁️Shout-out on social ☁️24 months worth of DATG Food (Chips and Salsa) ☁️25% off all Products Forever ☁️DATG Fashion Apparel + Swag ☁️Feature as part of our People Project ☁️24 tickets to DATG Festival ☁️Cameo appearance in a future DATG Film ☁️1 Full day with Founder ☁️All expenses trip to New York
  • Limited (2 left of 2)

About DREAMS AREN'T THIS GOOD.™

Legal Name
DATG group, llc
Founded
Dec 2017
Form
Delaware LLC
Employees
2
Website
dreamsarentthisgood.com
Social Media
Headquarters
Google Map location of of DREAMS AREN'T THIS GOOD.™
50 Avenue A , New York, NY
Headquarters
50 Avenue A, New York, NY, United States 10009

DREAMS AREN'T THIS GOOD.™ Team
Everyone helping build DREAMS AREN'T THIS GOOD.™, not limited to employees

Profile picture of Matt Bennett
Matt Bennett
Founder + CEO + Salsa Slinger (2017)
Featured in Superheroes · Read
Profile picture of Lyndi Munguia
Lyndi Munguia
Creative + Salsa Slinger (April 2018)
Profile picture of Jorge Munguia
Jorge Munguia
Creative + Salsa Slinger (April 2018)
Profile picture of James  Morano
James Morano
Creative + Salsa Slinger (June 2021)
Profile picture of Natalie Boylan
Natalie Boylan
Brand Dev + Salsa Slinger (February 2021)
Profile picture of Sally Persico
Sally Persico
Brand Dev + Salsa Slinger (May 2021)
Profile picture of Eva  Dilmanian
Eva Dilmanian
PR (September 2020)
Profile picture of John  Geantasio
John Geantasio
Outside CPA (February 2021)
Profile picture of Hal  Coopersmith
Hal Coopersmith
Outside Legal (June 2021)
Profile picture of Nate Newman
Nate Newman
Advisor (2017) | Winky Lux Founder
Profile picture of Kim  Nielsen
Kim Nielsen
Advisor (2017) | Heineken Brand Manager
Profile picture of Outasight   .
Outasight .
Advisor (2020) | Singer-Songwriter, Producer, 83sound Founder
11 more team members
Matt Bennett
Founder + CEO + Salsa Slinger (2017)
Lyndi Munguia
Creative + Salsa Slinger (April 2018)
Jorge Munguia
Creative + Salsa Slinger (April 2018)
James Morano
Creative + Salsa Slinger (June 2021)
Natalie Boylan
Brand Dev + Salsa Slinger (February 2021)
Sally Persico
Brand Dev + Salsa Slinger (May 2021)
Eva Dilmanian
PR (September 2020)
John Geantasio
Outside CPA (February 2021)
Hal Coopersmith
Outside Legal (June 2021)
Nate Newman
Advisor (2017) | Winky Lux Founder
Kim Nielsen
Advisor (2017) | Heineken Brand Manager
Outasight .
Advisor (2020) | Singer-Songwriter, Producer, 83sound Founder

Press

E127 Matt Bennett: DREAMS AREN'T THIS GOOD: Building a Sa...
Thepozcast Thepozcast
·
Feb 26, 2021

In this episode, Matt Bennett and I talk about the fear that comes along with chasing your dreams and the process of over...

Condiments Projected to Be A $98.3 Billion Market by 2024
Food Processing Food Processing
·
Jan 26, 2021

Drizzle, sauce, topping, whatever the preferred name, condiments are an easy solution to dressing up ordinary foods. It's...

54 Things That'll Do Jobs You Probably Didn't Even Know N...
BuzzFeed BuzzFeed
·
Dec 22, 2020

A bag of Dreams Aren't This Good tortilla chips cooked up specifically to be reheated in the oven, so you can have fresh,...

DREAMS AREN'T THIS GOOD Created a Unique First Fantasy Fl...
TrendHunter.com TrendHunter.com
·
Oct 6, 2020

Dreams Aren't This Good makes uniquely flavored salsas-like blueberry coconut salsa-that fuse the spirit of the South wit...

Finding real innovation at the virtual Specialty Food Live!
Foodbusinessnews Foodbusinessnews
·
Sep 30, 2020

For many in the food and beverage industry, the Winter Fancy Food Show, which was held mid-January 2020 in San Francisco,...

Introducing The First Lifestyle Salsa Brand: DREAMS AREN’...
·
Sep 23, 2020

New York City-based Pioneer of Craft Salsa Goes National with Fantasy Flavors.

Risks

The Company's management may have broad discretion in how the Company uses the net proceeds of the Offering.
Unless the Company has agreed to a specific use of the proceeds from the Offering, the Company’s management will have considerable discretion over the use of proceeds from the Offering. You may not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately.
There is no present market for the Securities and we have arbitrarily set the price.
The Offering price was not established in a competitive market. We have arbitrarily set the price of the Securities with reference to the general status of the securities market and other relevant factors. The Offering price for the Securities should not be considered an indication of the actual value of the Securities and is not based on our asset value, net worth, revenues or other established criteria of value. We cannot guarantee that the Securities can be resold at the Offering price or at any other price.
The amount of capital the Company is attempting to raise in this Offering may not be enough to sustain the Company’s current business plan.
In order to achieve the Company’s near and long-term goals, the Company may need to procure funds in addition to the amount raised in the Offering. There is no guarantee the Company will be able to raise such funds on acceptable terms or at all. If we are not able to raise sufficient capital in the future, we may not be able to execute our business plan, our continued operations will be in jeopardy and we may be forced to cease operations and sell or otherwise transfer all or substantially all of our remaining assets, which could cause an Investor to lose all or a portion of their investment.
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.
The Company is still in an early phase and we are just beginning to implement our business plan. There can be no assurance that we will ever operate profitably. The likelihood of our success should be considered in light of the problems, expenses, difficulties, complications and delays usually encountered by early stage companies. The Company may not be successful in attaining the objectives necessary for it to overcome these risks and uncertainties.
We may implement new lines of business or offer new products and services within existing lines of business.
As an early-stage company, we may implement new lines of business at any time. 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.
We rely on other companies to provide components and services for our products.
We depend on suppliers and contractors to meet our contractual obligations to our customers and conduct our operations. Our ability to meet our obligations to our customers may be adversely affected if suppliers or contractors do not provide the agreed-upon supplies or perform the agreed-upon services in compliance with customer requirements and in a timely and cost-effective manner. Likewise, the quality of our products may be adversely impacted if companies to whom we delegate manufacture of major components or subsystems for our products, or from whom we acquire such items, do not provide components which meet required specifications and perform to our and our customers’ expectations. Our suppliers may be unable to quickly recover from natural disasters and other events beyond their control and may be subject to additional risks such as financial problems that limit their ability to conduct their operations. The risk of these adverse effects may be greater in circumstances where we rely on only one or two contractors or suppliers for a particular component. Our products may utilize custom components available from only one source. Continued availability of those components at acceptable prices, or at all, may be affected for any number of reasons, including if those suppliers decide to concentrate on the production of common components instead of components customized to meet our requirements. The supply of components for a new or existing product could be delayed or constrained, or a key manufacturing vendor could delay shipments of completed products to us adversely affecting our business and results of operations.
We rely on various intellectual property rights, including trademarks, in order to operate our business.
The Company relies on certain intellectual property rights to operate its business. The Company’s intellectual property rights may not be sufficiently broad or otherwise may not provide us a significant competitive advantage. In addition, the steps that we have taken to maintain and protect our intellectual property may not prevent it from being challenged, invalidated, circumvented or designed-around, particularly in countries where intellectual property rights are not highly developed or protected. In some circumstances, enforcement may not be available to us because an infringer has a dominant intellectual property position or for other business reasons, or countries may require compulsory licensing of our intellectual property. Our failure to obtain or maintain intellectual property rights that convey competitive advantage, adequately protect our intellectual property or detect or prevent circumvention or unauthorized use of such property, could adversely impact our competitive position and results of operations. We also rely on nondisclosure and noncompetition agreements with employees, consultants and other parties to protect, in part, trade secrets and other proprietary rights. There can be no assurance that these agreements will adequately protect our trade secrets and other proprietary rights and will not be breached, that we will have adequate remedies for any breach, that others will not independently develop substantially equivalent proprietary information or that third parties will not otherwise gain access to our trade secrets or other proprietary rights. As we expand our business, protecting our intellectual property will become increasingly important. The protective steps we have taken may be inadequate to deter our competitors from using our proprietary information. In order to protect or enforce our patent rights, we may be required to initiate litigation against third parties, such as infringement lawsuits. Also, these third parties may assert claims against us with or without provocation. These lawsuits could be expensive, take significant time and could divert management’s attention from other business concerns. The law relating to the scope and validity of claims in the technology field in which we operate is still evolving and, consequently, intellectual property positions in our industry are generally uncertain. We cannot assure you that we will prevail in any of these potential suits or that the damages or other remedies awarded, if any, would be commercially valuable.
Although dependent on certain key personnel, the Company does not have any key man life insurance policies on any such people.
The Company is dependent on certain key personnel in order to conduct its operations and execute its business plan, however, the Company has not purchased any insurance policies with respect to those individuals in the event of their death or disability. Therefore, if any of these personnel die or become disabled, the Company will not receive any compensation to assist with such person’s absence. The loss of such person could negatively affect the Company and its operations. We have no way to guarantee key personnel will stay with the Company, as many states do not enforce non-competition agreements, and therefore acquiring key man insurance will not ameliorate all of the risk of relying on key personnel.
The Company is not subject to Sarbanes-Oxley regulations and may lack the financial controls and procedures of public companies.
The Company may not have the internal control infrastructure that would meet the standards of a public company, including the requirements of the Sarbanes Oxley Act of 2002. As a privately-held (non-public) Company, the Company is currently not subject to the Sarbanes Oxley Act of 2002, and its financial and disclosure controls and procedures reflect its status as a development stage, non-public company. There can be no guarantee that there are no significant deficiencies or material weaknesses in the quality of the Company's financial and disclosure controls and procedures. If it were necessary to implement such financial and disclosure controls and procedures, the cost to the Company of such compliance could be substantial and could have a material adverse effect on the Company’s results of operations.
The use of individually identifiable data by our business, our business associates and third parties is regulated at the state, federal and international levels.
The regulation of individual data is changing rapidly, and in unpredictable ways. A change in regulation could adversely affect our business, including causing our business model to no longer be viable. Costs associated with information security – such as investment in technology, the costs of compliance with consumer protection laws and costs resulting from consumer fraud – could cause our business and results of operations to suffer materially. Additionally, the success of our online operations depends upon the secure transmission of confidential information over public networks, including the use of cashless payments. The intentional or negligent actions of employees, business associates or third parties may undermine our security measures. As a result, unauthorized parties may obtain access to our data systems and misappropriate confidential data. There can be no assurance that advances in computer capabilities, new discoveries in the field of cryptography or other developments will prevent the compromise of our customer transaction processing capabilities and personal data. If any such compromise of our security or the security of information residing with our business associates or third parties were to occur, it could have a material adverse effect on our reputation, operating results and financial condition. Any compromise of our data security may materially increase the costs we incur to protect against such breaches and could subject us to additional legal risk.
Damage to our reputation could negatively impact our business, financial condition and results of operations.
Our reputation and the quality of our brand are critical to our business and success in existing markets, and will be critical to our success as we enter new markets. Any incident that erodes consumer loyalty for our brand could significantly reduce its value and damage our business. We may be adversely affected by any negative publicity, regardless of its accuracy. Also, there has been a marked increase in the use of social media platforms and similar devices, including blogs, social media websites and other forms of internet-based communications that provide individuals with access to a broad audience of consumers and other interested persons. The availability of information on social media platforms is virtually immediate as is its impact. Information posted may be adverse to our interests or may be inaccurate, each of which may harm our performance, prospects or business. The harm may be immediate and may disseminate rapidly and broadly, without affording us an opportunity for redress or correction.
Security breaches of confidential customer information, in connection with our electronic processing of credit and debit card transactions, or confidential employee information may adversely affect our business.
Our business requires the collection, transmission and retention of personally identifiable information, in various information technology systems that we maintain and in those maintained by third parties with whom we contract to provide services. The integrity and protection of that data is critical to us. The information, security and privacy requirements imposed by governmental regulation are increasingly demanding. Our systems may not be able to satisfy these changing requirements and customer and employee expectations, or may require significant additional investments or time in order to do so. A breach in the security of our information technology systems or those of our service providers could lead to an interruption in the operation of our systems, resulting in operational inefficiencies and a loss of profits. Additionally, a significant theft, loss or misappropriation of, or access to, customers’ or other proprietary data or other breach of our information technology systems could result in fines, legal claims or proceedings.
The U.S. Securities and Exchange Commission does not pass upon the merits of the Securities or the terms of the Offering, nor does it pass upon the accuracy or completeness of any Offering document or literature.
You should not rely on the fact that our Form C is accessible through the U.S. Securities and Exchange Commission’s EDGAR filing system as an approval, endorsement or guarantee of compliance as it relates to this Offering. The U.S. Securities and Exchange Commission has not reviewed this Form C, nor any document or literature related to this Offering.
Neither the Offering nor the Securities have been registered under federal or state securities laws.
No governmental agency has reviewed or passed upon this Offering or the Securities. Neither the Offering nor the Securities have been registered under federal or state securities laws. Investors will not receive any of the benefits available in registered offerings, which may include access to quarterly and annual financial statements that have been audited by an independent accounting firm. Investors must therefore assess the adequacy of disclosure and the fairness of the terms of this Offering based on the information provided in this Form C and the accompanying exhibits.
The Company has the right to limit individual Investor commitment amounts based on the Company’s determination of an Investor’s sophistication.
The Company may prevent any Investor from committing more than a certain amount in this Offering based on the Company’s determination of the Investor’s sophistication and ability to assume the risk of the investment. This means that your desired investment amount may be limited or lowered based solely on the Company’s determination and not in line with relevant investment limits set forth by the Regulation CF rules. This also means that other Investors may receive larger allocations of the Offering based solely on the Company’s determination.
The Company has the right to extend the Offering deadline. The Company has the right to end the Offering early.
The Company may extend the Offering deadline beyond what is currently stated herein. This means that your investment may continue to be held in escrow while the Company attempts to raise the Minimum Amount even after the Offering deadline stated herein is reached. While you have the right to cancel your investment in the event the Company extends the Offering, if you choose to reconfirm your investment, 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 the Company receiving the Minimum Amount, at which time it will be returned to you without interest or deduction, or the Company receives the Minimum Amount, at which time it will be released to the Company to be used as set forth herein. Upon or shortly after release of such funds to the Company, the Securities will be issued and distributed to you. The Company may also end the Offering early; if the Offering reaches its target Offering amount after 21-calendary days but before the deadline, the Company can end the Offering with 5 business day’s notice. This means your failure to participate in the Offering in a timely manner, may prevent you from being able to participate – it also means the Company may limit the amount of capital it can raise during the Offering by ending it early.
The Securities will not be freely tradable under the Securities Act until one year from the initial purchase date. Although the Securities may be tradable under federal securities law, state securities regulations may apply, and each Investor should consult with their attorney.
You should be aware of the long-term nature of this investment. There is not now and likely will not ever be a public market for the Securities. Because the Securities have not been registered under the Securities Act or under the securities laws of any state or foreign jurisdiction, the 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 the 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 they are purchasing the Securities for their own account, for investment purposes and not with a view to resale or distribution thereof.
Investors will not become equity holders until the Company decides to convert the Securities into “CF Shadow Securities” (the type of equity securities issuable upon conversion of the Securities) or until there is a change of control or sale of substantially all of the Company’s assets.
Investors will not have an ownership claim to the Company or to any of its assets or revenues for an indefinite amount of time and depending on when and how the Securities are converted, the Investors may never become equity holders of the Company. Investors will not become equity holders of the Company unless the Company receives a future round of financing great enough to trigger a conversion and the Company elects to convert the Securities into CF Shadow Securities. The Company is under no obligation to convert the Securities into CF Shadow Securities. In certain instances, such as a sale of the Company or substantially all of its assets, an initial public offering or a dissolution or bankruptcy, the Investors may only have a right to receive cash, to the extent available, rather than equity in the Company.
Equity securities issued upon conversion of the Securities may be substantially different from other equity securities offered or issued by the Company at the time of conversion.
In the event the Company decides to exercise the conversion right, the Company will convert the Securities into equity securities that are materially different from the equity securities being issued to new investors at the time of conversion in many ways, including, but not limited to, liquidation preferences, distributions, or anti-dilution protection. Additionally, any equity securities issued at the Conversion Price (as defined in the Crowd SAFE agreement) shall have only such preferences, rights, and protections in proportion to the Conversion Price and not in proportion to the price per unit paid by new investors receiving the equity securities. Upon conversion of the Securities, the Company may not provide the holders of such Securities with the same rights, preferences, protections, and other benefits or privileges provided to other investors of the Company. The forgoing paragraph is only a summary of a portion of the conversion feature of the Securities; it is not intended to be complete, and is qualified in its entirety by reference to the full text of the Crowd SAFE agreement, which is attached as Exhibit C.
Investors will not have voting rights, even upon conversion of the Securities into CF Shadow Securities. Upon the conversion of the Securities into CF Shadow Securities (which cannot be guaranteed), the holders of the CF Shadow Securities will be required to enter into a proxy with the Intermediary or its designee to ensure any statutory voting rights are voted in tandem with the majority holders of whichever series of securities the CF Shadow Securities follow.
Investors will not have the right to vote upon matters of the Company even if and when their Securities are converted into CF Shadow Securities (the occurrence of which cannot be guaranteed). Upon such conversion, the CF Shadow Securities will have no voting rights and, in circumstances where a statutory right to vote is provided by state law, the CF Shadow Security holders are required to enter into a proxy agreement with the Intermediary or its designee to vote their CF Shadow Securities with the majority of the holder(s) of the securities issued in the round of equity financing that triggered the conversion right. For example, if the Securities are converted in connection with an offering of Series B Preferred Units, Investors would receive CF Shadow Securities in the form of Series B-CF Preferred Shadow Units and would be required to enter into a proxy that allows the Intermediary or its designee to vote their shares of Series B-CF Preferred Units consistent with the majority of the Series B Preferred Unit holders. Thus, Investors will essentially never be able to vote upon any matters of the Company.
Investors will not be entitled to any inspection or information rights other than those required by law.
Investors will not have the right to inspect the books and records of the Company or to receive financial or other information from the Company, other than as required by law. Other security holders of the Company may have such rights. Regulation CF requires only the provision of an annual report on Form C and no additional information. Additionally, there are numerous methods by which the Company can terminate annual report obligations, resulting in no information rights, contractual, statutory or otherwise, owed to Investors. This lack of information could put Investors at a disadvantage in general and with respect to other security holders, including certain security holders who have rights to periodic financial statements and updates from the Company such as quarterly unaudited financials, annual projections and budgets, and monthly progress reports, among other things.
Investors will be unable to declare the Security in “default” and demand repayment.
Unlike convertible notes and some other securities, the Securities do not have any “default” provisions upon which Investors will be able to demand repayment of their investment. The Company has ultimate discretion as to whether or not to convert the Securities upon a future equity financing and Investors have no right to demand such conversion. Only in limited circumstances, such as a liquidity event, may Investors demand payment and even then, such payments will be limited to the amount of cash available to the Company.
The Company may never elect to convert the Securities or undergo a liquidity event and Investors may have to hold the Securities indefinitely.
The Company may never conduct a future equity financing or elect to convert the Securities if such future equity financing does occur. In addition, the Company may never undergo a liquidity event such as a sale of the Company or an initial public offering. If neither the conversion of the Securities nor a liquidity event occurs, Investors could be left holding the Securities in perpetuity. The Securities have numerous transfer restrictions and will likely be highly illiquid, with no secondary market on which to sell them. The Securities are not equity interests, have no ownership rights, have no rights to the Company’s assets or profits and have no voting rights or ability to direct the Company or its actions.
Equity securities acquired upon conversion of the Securities may be significantly diluted as a consequence of subsequent equity financings.
The Company’s equity securities will be subject to dilution. The Company intends to issue additional equity to employees and third-party financing sources in amounts that are uncertain at this time, and as a consequence holders of equity securities resulting from the conversion of the Securities will be subject to dilution in an unpredictable amount. Such dilution may reduce the Investor’s control and economic interests in the Company. The amount of additional financing needed by the Company will depend upon several contingencies not foreseen at the time of this Offering. Generally, additional financing (whether in the form of loans or the issuance of other securities) will be intended to provide the Company with enough capital to reach the next major corporate milestone. If the funds received in any additional financing are not sufficient to meet the Company’s needs, the Company may have to raise additional capital at a price unfavorable to their existing investors, including the holders of the Securities. The availability of capital is at least partially a function of capital market conditions that are beyond the control of the Company. There can be no assurance that the Company will be able to accurately predict the future capital requirements necessary for success or that additional funds will be available from any source. Failure to obtain financing on favorable terms could dilute or otherwise severely impair the value of the Securities. In addition, the Company has certain equity grants and convertible securities outstanding. Should the Company enter into a financing that would trigger any conversion rights, the converting securities would further dilute the equity securities receivable by the holders of the Securities upon a qualifying financing.
In the event of the dissolution or bankruptcy of the Company, Investors will not be treated as debt holders and therefore are unlikely to recover any proceeds.
In the event of the dissolution or bankruptcy of the Company, the holders of the Securities that have not been converted will be entitled to distributions as described in the Securities. This means that such holders will only receive distributions once all of the creditors and more senior security holders, including any holders of preferred units, have been paid in full. Neither holders of the Securities nor holders of CF Shadow Securities can be guaranteed any proceeds in the event of the dissolution or bankruptcy of the Company.
While the Securities provide mechanisms whereby holders of the Securities would be entitled to a return of their purchase amount upon the occurrence of certain events, if the Company does not have sufficient cash on hand, this obligation may not be fulfilled.
Upon the occurrence of certain events, as provided in the Securities, holders of the Securities may be entitled to a return of the principal amount invested. Despite the contractual provisions in the Securities, this right cannot be guaranteed if the Company does not have sufficient liquid assets on hand. Therefore, potential Investors should not assume a guaranteed return of their investment amount.
The Company has the right to conduct multiple closings during the Offering.
If the Company meets certain terms and conditions, an intermediate close of the Offering can occur, which will allow the Company to draw down on half of the proceeds committed and captured in the Offering during the relevant period. The Company may choose to continue the Offering thereafter. Investors should be mindful that this means they can make multiple investment commitments in the Offering, which may be subject to different cancellation rights. For example, if an intermediate close occurs and later a material change occurs as the Offering continues, Investors whose investment commitments were previously closed upon will not have the right to re-confirm their investment as it will be deemed to have been completed prior to the material change.
Our business could be negatively impacted by cyber security threats, attacks and other disruptions.
We continue to face advanced and persistent attacks on our information infrastructure where we manage and store various proprietary information and sensitive/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 may face potential difficulties in obtaining capital.
We may have difficulty raising needed capital in the future as a result of, among other factors, our lack of revenues from sales, as well as the inherent business risks associated with our Company and present and future market conditions. We will require additional funds to execute our business strategy and conduct our operations. If adequate funds are unavailable, we may be required to delay, reduce the scope of or eliminate one or more of our research, development or commercialization programs, product launches or marketing efforts, any of which may materially harm our business, financial condition and results of operations.
The Company’s success depends on the experience and skill of its managers, executive officers and key employees.
In particular, we are dependent on Matt Bennett, our Manager and Founder. The loss of Matt Bennett could harm the Company’s business, financial condition, cash flow and results of operations.
We operate in a highly regulated environment, and if we are found to be in violation of any of the federal, state, or local laws or regulations applicable to us, our business could suffer.
We are also subject to a wide range of federal, state, and local laws and regulations, such as local licensing requirements, and retail financing, debt collection, consumer protection, environmental, health and safety, creditor, wage-hour, anti-discrimination, whistleblower and other employment practices laws and regulations and we expect these costs to increase going forward. The violation of these or future requirements or laws and regulations could result in administrative, civil, or criminal sanctions against us, which may include fines, a cease and desist order against the subject operations or even revocation or suspension of our license to operate the subject business. As a result, we have incurred and will continue to incur capital and operating expenditures and other costs to comply with these requirements and laws and regulations.
State and federal securities laws are complex, and the Company could potentially be found to have not complied with all relevant state and federal securities law in prior offerings of securities.
The Company has conducted previous offerings of securities and may not have complied with all relevant state and federal securities laws. If a court or regulatory body with the required jurisdiction ever concluded that the Company may have violated state or federal securities laws, any such violation could result in the Company being required to offer rescission rights to investors in such offering. If such investors exercised their rescission rights, the Company would have to pay to such investors an amount of funds equal to the purchase price paid by such investors plus interest from the date of any such purchase. No assurances can be given the Company will, if it is required to offer such investors a rescission right, have sufficient funds to pay the prior investors the amounts required or that proceeds from this Offering would not be used to pay such amounts. In addition, if the Company violated federal or state securities laws in connection with a prior offering and/or sale of its securities, federal or state regulators could bring an enforcement, regulatory and/or other legal action against the Company which, among other things, could result in the Company having to pay substantial fines and be prohibited from selling securities in the future.
The Company could potentially be found to have not complied with securities law in connection with this Offering related to “Testing the Waters.”
Prior to filing this Form C, the Company engaged in “testing the waters” permitted under Regulation Crowdfunding (17 CFR 227.206), which allows issuers to communicate to determine whether there is interest in the offering. All communication sent is deemed to be an offer of securities for purposes of the antifraud provisions of federal securities laws. Any Investor who expressed interest prior to the date of this Offering should read this Form C thoroughly and rely only on the information provided herein and not on any statement made prior to the Offering. The communications sent to Investors prior to the Offering are attached as Exhibit E. Some of these communications may not have included proper disclaimers required for “testing the waters”.
A Crowd SAFE holder may lose their right to any appreciation or return on investment due to defaulting on certain notice and require action requirements in such Crowd SAFE; failure to claim cash set aside in this case may result in a total loss of principal.
The Crowd SAFE offered requires a holder to complete, execute and deliver any reasonable or necessary information and documentation requested by the Company or the Intermediary in order to effect the conversion or termination of the Crowd SAFE, in connection with an Equity Financing or Liquidity Event, within thirty (30) calendar days of receipt of notice (whether actual or constructive) from the Company. Failure to make a timely action may result in the Company declaring that the Investor is only eligible to receive a cash payment equal to their Purchase Amount (or a lesser amount in certain events). While the Company will set aside such payment for the investor, such payment may be subject to escheatment laws, resulting in a total loss of principal if the Investor never claims their payment.
There is no guarantee of a return on an Investor’s investment.
There is no assurance that an Investor will realize a return on their investment or that they will not lose their entire investment. For this reason, each Investor should read this Form C and all exhibits carefully and should consult with their attorney and business advisor prior to making any investment decision.
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