Brakes To Go

Brakes To Go

Growth Stage

Mobile on-demand brake service and repair

Mobile on-demand brake service and repair

Overview

Raised this Round: Raised: $280,104

Total Commitments ($USD)

Platform

StartEngine

Start Date

06/15/2021

Close Date

04/12/2022

Min. Goal
$9,997
Max. Goal
$4,999,986
Min. Investment

$152

Security Type

Equity - Common

Series

Seed

SEC Filing Type

RegCF    Open SEC Filing

Price Per Share

$2.93

Pre-Money Valuation

$9,801,465

Year Founded

2014

Industry

Transportation, Automotive, Aviation, & Aerospace

Tech Sector

Hardwaretech

Distribution Model

B2C

Margin

Medium

Capital Intensity

Low

Location

Austin, Texas

Business Type

Life Style

Brakes To Go, with a pre-money valuation of $9.8 million, is raising funds on StartEngine. The company runs a mobile brake repair service that helps people handle brake maintenance issues in a convenient and value-oriented manner. The business makes brake repair affordable, convenient, and transparent. Jonathan Ganther and Randall C. Huntsinger founded Brakes To Go in November 2014. The proceeds of the current crowdfunding round, with a minimum target of $9,997.16 and a maximum target of $4,999,986.40, will be used for growth and expansion. Brakes To Go reported $9.1 million in gross sales in Texas alone. The business has serviced over 16,000 customers to date and reported an average pre-COVID quarterly growth rate of 46%.

Summary Profit and Loss Statement

Most Recent Year Prior Year

Revenue

$2,059,915

$1,945,807

COGS

$1,119,829

$1,019,254

Tax

$0

$0

 

 

Net Income

$-146,249

$3,797

Summary Balance Sheet

Most Recent Year Prior Year

Cash

$360,711

$89,312

Accounts Receivable

$9,090

$10,773

Total Assets

$660,532

$389,475

Short-Term Debt

$216,600

$245,416

Long-Term Debt

$968,495

$522,377

Total Liabilities

$1,185,095

$767,793

Financials as of: 06/15/2021
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Raise History

Offering Name Close Date Platform Valuation/Cap Total Raised Security Type Status Reg Type
Brakes To Go 04/11/2022 StartEngine $9,801,465 $280,104 Equity - Common Funded RegCF
Brakes To Go 12/08/2019 Microventures $9,000,000 $395,162 Convertible Note Funded RegCF
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Revenue History

Note: Revenue data points reflect the latest of either the most recent fiscal year's financials, or updated revenues directly from the founder, at each raise's close date.

Valuation History

Price per Share History

Note: Share prices shown in earlier rounds may not be indicative of any stock splits.

Employee History

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Synopsis

There are more than 270 million vehicles on the road in the US. And about every four years — or every 50,000 miles or so — Americans need to replace their brakes. 

Drivers typically take their cars to the mechanic to replace their brakes. But Brakes To Go wants to change that. With a phone call or online booking, the company sends a certified mechanic to a client’s home or place of business. The company has branded vans servicing the Austin, Texas area. With the proceeds of this campaign, the company hopes to expand to other major metropolitan areas throughout Texas. It also intends to expand to at least three out-of-state locations this year and eventually grow across the entire Sun Belt region.

Brakes To Go’s current StartEngine raise has been rated a Neutral Deal by the KingsCrowd investment team.

Next Section: Price

Price

Brakes To Go has a $9.8 million pre-money valuation. Based on the traction the company has achieved over time, our system has rated the pricing of this transaction to be slightly above average on our one-to-five scale.

Next Section: Market

Market

Brakes To Go’s average ticket price per customer is $492, according to its raise page. With 22 million cars in Texas and an average brake replacement period of four years, the company’s free market opportunity is about $2.7 billion. Adding more services could allow Brakes To Go to grow its operations further, but it has expressed no interest in doing so. 

The auto mechanic industry is known to grow at a notoriously slow pace. According to IBISWorld, the industry is only expected to grow by about 3.2% in 2021. In fact, the market has actually shrunk over the past five years. In all, this has led our system to rate Brakes To Go’s market prospects below average.

Next Section: Team

Team

Randall Huntsinger is Brakes To Go’s co-founder and CEO. He also serves as the company’s general counsel. Previously, he was a principal at the Law Office of Randall Huntsinger where he provided technical and consulting services to commercial and small business customers. Prior to that, he worked as an attorney at Godwin Gruber and an associate attorney general for the Texas Attorney General. He also has a degree in business administration and accounting from the University of Texas at Austin. Given Huntsinger’s extensive legal experience and business education, he seems to be a strong leader for the company.

Jonathan Ganther serves as the company’s COO and co-founder. His record shows no other relevant experience except for the fact that he is a graduate of Wyotech-Laramie, where he studied automotive technology and automotive engineering technology. These experiences from its co-founders led our system to rate the team aspect of the company above average on our scale.

Next Section: Differentiators

Differentiators

Brakes To Go’s service offering is not particularly unique. Customers can find mechanics everywhere. And while mobile mechanics are less common, they still exist in every state across the country. Brakes To Go’s focus on mobile mechanics dedicated to brake repair is somewhat of a differentiator, but it is still not entirely unique. NuBrakes also focuses on mobile brake repair and currently operates in at least 14 markets throughout Texas as well as in two other states. Overall, though, Brakes To Go’s focus on brakes and customer service somewhat set it apart.

Because of this, our system has decided to rate the differentiation of the company above average on our scale.

Next Section: Performance

Performance

In 2019, Brakes To Go generated sales of $1.9 million. Even during the COVID-19 pandemic, revenue inched up to $2.1 million in 2020. That said, the company’s fiscal year ends on April 30 of each year, so its 2020 fiscal year only bakes in two months of pain caused by the crisis. Net income in 2019 was a little under $4,000, while in 2020 the company generated a net loss of $146,249. Though it is discouraging to see its bottom line figures worsen, to see revenue continue to expand is a positive — especially revenue in the millions. Because of that — and the more than 16,000 customers that the company has serviced — our system has rated the performance of the enterprise near the high end of our scale.

Next Section: Risks

Risks

All things taken together, our system has rated the risk profile of Brakes To Go near the low end of our scale. Only financial risk is elevated. In addition to Brakes To Go seeing its bottom line worsen from a net profit perspective, the company also has long-term debt of $968,495. Fortunately, some of this is offset by cash on hand of $360,711. However, having any large amount of debt at a time when the company is generating negative cash flow does make it a riskier investment.

Next Section: Bearish Outlook

Bearish Outlook

Investors may be concerned that Brakes To Go’s market opportunity is fairly small and growing at a slow pace. The company’s lack of significant differentiation is another issue that could hinder future growth prospects. The team is fairly strong, but the company could use some additional people with experience in this space. Investors may also want to take note of the company’s elevated financial risk.

Next Section: Bullish Outlook

Bullish Outlook

Brakes To Go’s pricing seems reasonable, all things considered. Its management team has some relevant experience, and the business has achieved undeniably impressive traction. This is especially true with the revenue it has generated despite being in just one core market. It’s very possible that the company could have 10 or 20 prime locations under its belt someday.

Next Section: Executive Summary

Executive Summary

Brakes To Go offers mobile brake repair to drivers in the Austin, Texas area. The company has an overall low risk profile, offers a reasonable valuation, and has shown promising traction. It is far from being an early-stage prospect (having been founded in 2015), and that alone removes a great deal of uncertainty about whether or not it can survive in the long run. There are some concerns that investors should note, such as Brakes To Go’s small market opportunity, its lack of complete distinction, and its possible financial risks. On the whole, we believe that the good more or less offsets the bad. Because of this, our team has decided to rate the company a Neutral prospect.

For questions regarding the KingsCrowd staff pick or ratings for this company, please reach out to support@kingscrowd.com.

Analysis written by Daniel Jones.

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Brakes To Go on StartEngine 2021
Platform: StartEngine
Security Type: Equity - Common
Valuation: $9,801,465
Price per Share: $2.93

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