okom wrks labs
About this raise: okom wrks labs, with a valuation of $16 million, is raising funds on Wefunder. The company is harnessing hemp and mycelium to make regenerative and structural building materials. okom wrks labs’ mycelium-based composite, zero-frm, aims to eliminate lumber and adhesive from buildings and has the ability to provide great strength along with being backyard compostable. The company is harnessing the power of fungi and supporting local economies, farming, and manufacturing in the country. Joshua English founded okom wrks labs in November 2021. The current crowdfunding campaign has a minimum target of $50,000 and a maximum target of $500,000. The campaign proceeds will be used to purchase materials for the Autodesk Research Residency, purchase some automation equipment, and build an off-campus industrial space to store the extra gear and materials during the residency.
Investment Overview
Committed $21,500 :
Deal Terms
Company & Team
Company
- Year Founded
- 2021
- Industry
- Industrial Services
- Tech Sector
- Distribution Model
- B2B
- Margin
- High
- Capital Intensity
- High
Financials
-
Revenue
- $282,096
- Monthly Burn
- $4,000
-
Runway
- 1.6 months
- Gross Margin
- 75%
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Synopsis
okom wrks labs focuses on developing regenerative building materials by utilizing hemp and mycelium. The company aims to provide structural composites that can replace traditional lumber and adhesives in construction. Their product, zero-frm, offers strength and is compostable, supporting efforts towards sustainability in building practices.
The primary customers of okom wrks labs are businesses involved in construction and manufacturing that are seeking sustainable materials. These customers are likely to be interested in reducing their environmental impact and supporting local economies through innovative building solutions.
The problem addressed by okom wrks labs is the environmental impact of traditional building materials, which often involve deforestation and non-biodegradable components. The construction industry faces challenges in reducing carbon footprints and finding sustainable alternatives to conventional materials.
okom wrks labs offers a solution through their mycelium-based composite, zero-frm, which binds hemp particles without industrial pressures or adhesives. This process results in a strong, compostable material that can be used in place of traditional building components, potentially reducing the environmental impact of construction projects.
In everyday scenarios, the use of traditional lumber and adhesives in construction can lead to increased carbon emissions and waste. By adopting okom wrks labs' zero-frm, construction companies can contribute to more sustainable practices. This approach not only addresses environmental concerns but also supports local farming and manufacturing, making it a practical choice for businesses looking to integrate eco-friendly solutions into their operations.
Price
okom wrks labs is offering a SAFE (Simple Agreement for Future Equity) in its current fundraising round. The valuation cap for this SAFE is set at $16 million, with no discount offered to investors. This structure allows investors to convert their investment into equity at a future financing round, subject to the valuation cap.
In terms of exit potential, startups like okom wrks labs, which operate in the industrial services sector, typically require significant market penetration and revenue growth to achieve substantial returns. To provide a 10X return on investment, the company would need to reach a valuation of approximately $160 million at the time of exit. This calculation does not account for potential dilution that may occur in future funding rounds.
okom wrks labs currently has a high revenue multiple of 56.7x, which suggests that the deal may be overvalued based on its current revenue and growth rate. This high multiple could indicate that the terms may not be favorable for investors seeking value based on traditional revenue metrics. However, potential investors should consider the company's position within its market and its growth prospects when evaluating the investment opportunity.
Market
The U.S. structural composites market, where okom wrks labs operates, is valued at approximately $15.2 billion and is expected to grow at an annual rate of 7.54%. Key drivers in this market include the increasing demand for sustainable building materials and the push for environmentally friendly construction practices. These trends align with the company's focus on regenerative materials, which could positively impact its growth prospects as the industry shifts towards sustainability.
okom wrks labs' product, which utilizes hemp and mycelium for structural building materials, has the potential to appeal to a broad segment of the construction market. Its compostable and adhesive-free characteristics may attract interest from companies seeking to reduce their environmental footprint. However, its unique composition might initially appeal more to niche markets focused on sustainability and eco-friendly construction before achieving wider adoption.
Market trends also reflect a growing interest in reducing carbon emissions and promoting local sourcing, which aligns with the company's approach to supporting local economies and farming. These factors can create opportunities for okom wrks labs to position itself as a viable alternative to traditional structural materials, potentially driving its acceptance and market penetration.
Team
okom wrks labs is led by a team with diverse expertise relevant to its mission of developing sustainable building materials. Joshua English serves as the Chief Science Officer, bringing six years of industry experience. His role is crucial in overseeing the scientific and technological development of the company's mycelium-based products.
Chris Magwood, the Chief Climate Officer, has over 21 years of experience in sustainable construction. His extensive background in climate-focused building practices aligns well with the company's goal of promoting eco-friendly materials in the construction industry.
April Magill, as the VP of Architecture, contributes 14 years of architectural experience. Her expertise is vital for integrating the company's products into practical building applications, ensuring they meet industry standards and client needs.
John Kabanda, the VP of Engineering, has four years of relevant experience, focusing on the engineering aspects of product development. His role supports the technical execution necessary for scaling production and ensuring product quality.
The team's combined expertise provides a strong foundation for achieving okom wrks labs' objectives. However, the part-time involvement of some team members may pose challenges in maintaining strategic focus and operational momentum. Expanding the team to include full-time leadership in key areas such as marketing and sales could be critical for driving growth and reaching future milestones.
Differentiation
okom wrks labs operates in a market with a few notable competitors, such as Ecovative Design and MycoWorks. Ecovative Design is a larger company that also utilizes mycelium technology for sustainable materials, focusing on packaging and textiles. MycoWorks, another competitor, specializes in creating leather alternatives from mycelium, targeting the fashion industry. Both companies have established themselves with significant market presence and product offerings.
Compared to these competitors, okom wrks labs is smaller in size but distinguishes itself through its focus on structural building materials. The company's product quality is supported by its patented process, which eliminates the need for industrial pressures and adhesives, potentially offering a cost-effective and environmentally friendly alternative. Pricing specifics are not readily available, but the unique characteristics of okom wrks labs' products may allow for competitive pricing within the sustainable construction materials market.
The target customer demographics for okom wrks labs include construction companies, architects, and builders who prioritize sustainability and eco-friendly practices. These customers are likely to be environmentally conscious and interested in innovative materials that reduce carbon footprints and promote local economies. The company's focus on regenerative materials positions it to appeal to this growing segment within the construction industry.
Performance
okom wrks labs has reported annual revenue of approximately $282k for the most recent fiscal year. This represents a significant increase from the previous fiscal year, which had no reported revenue, indicating initial market traction. However, the company still faces challenges in achieving profitability, as evidenced by a net loss of around $139.6k for the same period.
The company's most recent monthly burn rate is approximately $4k, with cash on hand amounting to $6.2k. This financial situation underscores a limited runway, emphasizing the necessity for additional funding to support ongoing operations and strategic initiatives.
Despite the reported revenue, the company's performance metrics highlight the need for strategic financial management to extend operational runway and improve financial sustainability. The focus will likely be on optimizing operational efficiencies and increasing revenue streams to achieve a more stable financial position moving forward.
Risk
Investing in okom wrks labs presents several specific risks that potential investors should consider. One significant concern is the company's high revenue multiple of 56.7x, which could suggest overvaluation relative to its current revenue levels. This valuation might not align with traditional metrics, posing a risk if future growth does not meet expectations.
Another critical risk factor is the company's low runway. With a monthly burn rate of approximately $11.6k and cash on hand at about $6.2k, the company has limited funds to sustain operations. This financial constraint highlights the urgency of securing additional funding to continue development and market expansion.
The company also faces challenges inherent in scaling production, as indicated by the need for a long time to scale both production and sales. These factors could delay market entry and revenue generation, impacting overall business performance.
Additionally, the presence of part-time founders can affect strategic focus and operational execution. While the team possesses relevant industry experience, part-time involvement may limit the ability to respond swiftly to market changes and drive the company toward its goals effectively.
Bullish Outlook
okom wrks labs presents several factors supporting a bullish outlook. The growing demand for sustainable building materials offers significant market opportunities, particularly as the construction industry increasingly prioritizes eco-friendly solutions. With the U.S. structural composites market valued at $15.2 billion and expanding at 7.54% annually, there is ample room for the company to capture market share.
The company's unique strength lies in its patented process for creating mycelium-based materials without industrial pressures or adhesives. This approach not only aligns with environmental trends but also positions okom wrks labs as a leader in regenerative building materials. The focus on sustainability can attract customers seeking to meet stricter environmental guidelines and reduce their carbon footprint.
Emerging trends, such as the shift towards carbon-neutral construction and local sourcing, serve as key growth drivers for the company. These trends enhance the appeal of okom wrks labs' offerings, potentially leading to increased adoption and market expansion. Additionally, the company may explore new markets beyond traditional construction, leveraging its technology for broader applications.
From a financial perspective, while the company currently faces certain challenges, its ability to secure additional funding can provide the necessary resources to scale operations and drive growth. The focus on sustainability and unique product characteristics can serve as a strong foundation for building investor confidence and achieving long-term growth.
Bearish Outlook
okom wrks labs faces several challenges that contribute to a bearish outlook. The company's position in a competitive market with players like Ecovative Design and MycoWorks may present difficulties in establishing significant market share. These competitors are more established and may offer broader product ranges, posing a barrier to okom wrks labs' growth.
Leadership concerns also arise due to the part-time involvement of some team members, which might limit the strategic focus and operational execution needed for scaling the business. This could affect the company's ability to respond effectively to market dynamics and capitalize on opportunities.
In terms of growth inhibitors, okom wrks labs might encounter technological hurdles in scaling production efficiently. As a new entrant, the company may also face limited market adoption as it attempts to convince the construction industry to shift from traditional materials to its mycelium-based products.
Financially, okom wrks labs shows signs of strain. The company's cash flow is under pressure with a limited cash reserve and a burn rate that suggests a short runway for operations. This financial position might necessitate further fundraising, potentially on less favorable terms, impacting investor returns.
The high revenue multiple of 56.7x compared to industry benchmarks indicates a potential overvaluation. This could deter investors who are seeking reasonable entry points based on revenue metrics. These financial concerns, combined with the operational and market challenges, provide a cautious view of the company's immediate growth prospects.
Executive Summary
okom wrks labs is focused on creating sustainable building materials using hemp and mycelium, targeting construction companies and architects who prioritize eco-friendly practices. The company operates in the U.S. structural composites market, which is valued at $15.2 billion and growing at 7.54% annually.
The company is currently raising funds through a SAFE with a valuation cap of $16 million. Despite reporting $282k in revenue, okom wrks labs faces financial challenges with a monthly burn rate of $4k and limited cash reserves. The high revenue multiple of 56.7x suggests potential overvaluation, highlighting the need for strategic financial management.
okom wrks labs differentiates itself with its patented, adhesive-free process, appealing to a niche market focused on sustainability. Competitors like Ecovative Design and MycoWorks offer similar mycelium-based products but focus on different applications. The company's target demographic includes environmentally conscious builders and architects.
The team, led by Joshua English and supported by experienced professionals like Chris Magwood and April Magill, provides a strong foundation for achieving company goals. However, part-time involvement of some members and limited full-time leadership in key areas pose potential risks.
From a bullish perspective, the company's alignment with market trends towards sustainability and its unique product offering could drive growth. Conversely, the bearish outlook highlights financial constraints, potential overvaluation, and challenges in scaling production and market penetration.
In conclusion, okom wrks labs presents a mixed investment opportunity. The company's innovative approach to sustainable materials aligns well with market trends, offering potential for growth. However, financial challenges and operational risks must be carefully considered. Investors will need to weigh the company's unique positioning against these risks to determine its suitability as an investment.
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Company Funding & Growth
Funding history
- Total Prior Capital Raised
- $434,449
- VC Backed?
- Yes
Close Date | Platform | Valuation | Total Raised | Security Type | Status | Reg Type |
---|---|---|---|---|---|---|
04/30/2025 | Wefunder | $16,000,000 | $21,500 | SAFE | Active | RegCF |