Paleblue

Paleblue

Growth Stage

Sustainable, rechargeable li-ion batteries for a better future

Sustainable, rechargeable li-ion batteries for a better future

Overview

Raised this Round: Raised: $314,425

Total Commitments ($USD)

Platform

Wefunder

Start Date

12/21/2023

Close Date

04/29/2024

Min. Goal
$50,000
Max. Goal
$1,235,000
Min. Investment

$200

Security Type

Convertible Note

Series

Series A

SEC Filing Type

RegCF    Open SEC Filing

Valuation Cap

$16,800,000

Discount

20%

Year Founded

2020

Industry

Energy, Power, & Natural Resources

Tech Sector

Cleantech

Distribution Model

B2B/B2C

Margin

Medium

Capital Intensity

Low

Location

Park City, Utah

Business Type

Growth

Paleblue, with a valuation of $16.8 million, is raising funds on Wefunder. The company makes sustainable and rechargeable Li-ion batteries. Paleblue batteries are fast charging, super convenient, and long-lasting, with an eye on the planet’s future. The business has sold over two million batteries since 2019 and has its product available in 20 countries. Thomas Bishop and Steve Warren founded Paleblue in August 2020. The current crowdfunding campaign has a minimum target of $50,000 and a maximum target of $1.24 million. The campaign proceeds will be used for inventory to support retail expansion, marketing, EU expansion, and hiring.

Summary Profit and Loss Statement

FY 2022 FY 2021

Revenue

$3,275,020

$1,815,262

COGS

$1,546,809

$1,012,870

Tax

$0

$0

 

 

Net Income

$-918,702

$-517,620

Summary Balance Sheet

FY 2022 FY 2021

Cash

$398,734

$258,624

Accounts Receivable

$98,977

$112,420

Total Assets

$1,141,790

$962,015

Short-Term Debt

$559,232

$544,168

Long-Term Debt

$2,106,081

$1,043,499

Total Liabilities

$2,665,313

$1,587,667

Financials as of: 12/21/2023
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Synopsis

Paleblue is making strides in the energy sector with its sustainable and rechargeable lithium-ion (Li-ion) batteries. These batteries are designed to be a superior alternative to traditional single-use batteries, offering fast charging, convenience, and longevity, all while keeping an eye on environmental sustainability. The batteries come in the common sizes AAA, AA, C, D,  9v, & CR123A and include an onboard battery management system (BMS) that enables fast USB-C charging. 

Since its inception in 2019, Paleblue has successfully sold over two million batteries and expanded its market presence to 20 countries. This growth signifies a strong demand for more eco-friendly and efficient power solutions. The company's mission to replace inefficient and wasteful single-use batteries aligns with the increasing global focus on sustainability and the reduction of environmental waste.

Next Section: Price

Price

Paleblue is currently raising funds on Wefunder with a valuation cap of $16.8 million. This valuation is supported by the company's substantial revenues, reaching $3.3 million in revenue in 2022. When the raise went live, management shared 2023 annual revenue projections of $3.5 million. The revenue multiple of 5.13 is well within reasonable bounds for a company in the Energy, Power, & Natural Resources industry, particularly when considering the growth trajectory and the expanding market for lithium-ion batteries. The company's placement in 350 domestic retail locations, availability in 20 countries, and patent-pending technology further bolster the valuation's credibility. The use of a convertible note with an 8% interest rate and a 20% discount provides potential investors with a favorable entry point. 

 

Next Section: Market

Market

Paleblue operates in the lithium-ion battery market. The market is currently valued at $64.87 billion globally and is projected to grow at a compound annual growth rate of 14.2%. The lithium-ion battery market is growing, and the global scope reflects Paleblue's presence in 20 countries. 

Advances in battery technology, including improvements in battery chemistry, manufacturing processes, and energy management systems, have led to longer cycle lives and reduced costs. As a result, lithium-ion batteries have become an increasingly attractive option for household use. Their convenience, portability, and suitability for a wide range of applications, from powering electronic devices to tools and small appliances, further heighten their appeal.

However, the rechargeable battery market is highly reliant on the availability of raw materials such as lithium, cobalt, and nickel. Supply chain disruptions caused by geopolitical tensions, trade restrictions, or other factors can impact the availability and cost of these materials, presenting potential challenges in the market.

Next Section: Team

Team

Paleblue is led by co-founders Thomas Bishop and Steve Warren. Bishop, the CEO of the company, spent time in operations, product, and development roles at large consumer goods companies like Skullcandy and Burton Snowboards. He holds a Master's Degree in Materials Science from the University of Rochester. 

Warren, the COO of Paleblue, has an impressive 25 years of consumer electronics experience across the globe, most recently with Carbon Mobile in Hong Kong. With his strong managerial skills, he plays a crucial role in the company's operations and growth. Together with Bishop, Warren is committed to developing fast-charging, convenient, and long-lasting batteries that positively impact the planet.

The Paleblue team consists of six individuals, many of whom spent time at Skullcandy with Bishop. The group fills product, sales, marketing, and operations roles. Their past experience working together and complementary skills will serve them well in growing the company. 

Next Section: Differentiation

Differentiation

Paleblue differentiates itself in the lithium-ion battery market by offering sustainable and rechargeable batteries that aim to replace wasteful single-use batteries. The company's batteries have several key advantages over traditional batteries, including fast charging, convenience, and long-lasting performance. Paleblue has sold over two million batteries since 2019 and has established a presence in 20 countries.

Furthermore, Paleblue's commitment to sustainability sets it apart from its competitors. The company's focus on replacing single-use batteries with rechargeable alternatives aligns with the growing global demand for environmentally friendly solutions. Paleblue's batteries contribute to reducing waste and minimizing the environmental impact associated with disposable batteries.

While Paleblue operates in a very competitive market with established competitors such as Duracell, Panasonic, EBL, Ladda, HiQuick, and Bonai, the growing customer base positions it well for future growth. However, it is important to note that several other options exist on the market and at similar price points. It will be hard to continually differentiate in the market, especially amongst household brands like Duracell.

Next Section: Performance

Performance

Paleblue, a sustainable Li-ion battery manufacturer, has demonstrated impressive traction in the market. The company's batteries are available on Amazon and in 350 domestic retail locations, resulting in $3.3 million in revenue in 2022. In the Q&A section of the raise page, management projected closing 2023 with $3.5 million in revenue, indicating that growth may be slowing. That said, Paleblue's products have reached customers in 20 countries, highlighting the global demand for their sustainable and rechargeable batteries.

Paleblue's batteries offer several advantages over traditional single-use batteries. They are fast-charging, convenient, and long-lasting, providing better performance, reliability, and ease of use. The company has sold over two million batteries since its inception in 2019, indicating strong customer adoption and satisfaction.

It is important to note that the company is still in the pre-profit stage of development. With $140,533 in cash on hand and a monthly burn rate of $40,312, the company has just over three months of runway.

Finally, Paleblue has established strategic partnerships with organizations such as Forever Project, 1% for the Planet, Protect Our Winters, Fish for Garbage, and Wasatch Trails Foundation. These partnerships enhance Paleblue's brand reputation and align with its mission of promoting sustainability and environmental conservation.

Next Section: Risk

Risk

Paleblue faces certain risks as it seeks to establish itself in the competitive market of sustainable and rechargeable Li-ion batteries.

One of the main risks for Paleblue is the competitive landscape. Competitors such as Duracell, Panasonic, EBL, Ladda, HiQuick, and Bonai already exist in the market, offering their range of rechargeable batteries. These competitors may have established brand recognition and customer loyalty, making it challenging for Paleblue to capture a significant market share. Additionally, the low barriers to entry in the industry mean that new competitors could enter the market and further increase competition.

Furthermore, Paleblue will need to continuously invest in research and development to stay ahead in the market. As technology in the battery industry continues to evolve, Paleblue needs to innovate and offer improved product features and performance. Failure to keep up with technological advancements could lead to declining market share and revenue growth.

Lastly, the company's financial position remains a concern. Paleblue is not yet profitable and relies on external funding to sustain its operations. The company will need to effectively manage its finances and secure sufficient funding to support its growth plans and overcome any potential cash flow challenges.

Next Section: Bullish Outlook

Bullish Outlook

Paleblue is well-positioned to capitalize on the growing demand for sustainable and rechargeable lithium-ion batteries. With a mission to replace single-use batteries, Paleblue's Li-ion batteries offer superior performance, convenience, and sustainability. The company has sold over two million batteries in 20 countries since 2019, demonstrating market demand and customer satisfaction.

Paleblue's annual revenue of $3.3 million highlights the company's ability to generate substantial sales and capture market share. With a valuation of $16.8 million, Paleblue's crowdfunding campaign on Wefunder presents an opportunity for investors to own a piece of the company at a fair price.

Additionally, the addressable market for lithium-ion batteries is substantial, and Paleblue's innovative product offering positions the company for continued success. While the competitive landscape is crowded, the size of the market could allow for multiple companies to make outsized returns.

Next Section: Bearish Outlook

Bearish Outlook

While Paleblue operates in the promising market of sustainable and rechargeable Li-ion batteries, it faces plenty of competition from established players like Duracell, Panasonic, EBL, Ladda, HiQuick, and Bonai. These competitors have already established their presence in the market and have a strong customer base, especially Duracell, which is a household name.

Furthermore, while Paleblue has achieved some revenue growth, its profitability remains a concern. With a negative net income of $918,702 in the most recent fiscal year, Paleblue must demonstrate its ability to generate sustainable profits to continue attracting investors.

Finally, in the raise page Q&A management predicted $3.5 million in annual revenue for 2023, up from $3.3 million in 2022. These projections indicate that revenue growth is slowing, especially considering management reported 180% year-over-year growth in years prior. 

Next Section: Executive Summary

Executive Summary

Paleblue is a company that manufactures sustainable and rechargeable lithium-ion batteries. The company's mission is to replace wasteful single-use batteries with a more sustainable alternative. Paleblue's batteries are designed to offer better performance, reliability, convenience, and ease of use, with fast charging times and long-lasting power. 

Since 2019, Paleblue has sold over two million batteries and has its products available in 20 countries. The company has brought in more than $3 million in revenue over the past year. Despite this, the company is not yet profitable, with a net income of -$918,702 for the most recent fiscal year.

Paleblue operates in a very competitive market, with notable competitors such as Duracell, Panasonic, EBL, Ladda, HiQuick, and Bonai. However, the company's focus on sustainability and rechargeable batteries sets it apart from traditional battery manufacturers. Paleblue has also filed for patents, further strengthening its competitive position.

The company is currently raising funds on Wefunder, with a minimum target of $50,000 and a maximum target of $1.24 million. The company's valuation is set at $16.8 million.

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Founder Profile

Paleblue's Vision: A World Without Single-Use Battery Waste

With a revolutionary approach, Paleblue aims to replace single-use batteries with their advanced rechargeable alternatives, aiming to eliminate nearly a million tons of battery waste annually. Their dedication to sustainability extends beyond product innovation, as they actively collaborate with organizations like 1% for the Planet and Fish for Garbage. In our insightful conversation with Thomas Bishop, we get into Paleblue's journey, the technological distinctions of their batteries, and their profound impact on both the environment and the industry.

Read Founder Interview

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Paleblue on Wefunder 2023
Platform: Wefunder
Security Type: Convertible Note
Valuation: $16,800,000

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