PetroFunders

PetroFunders

Early Stage

The premier crowdfunding platform, creating access to commercial grade oil & gas investments.

The premier crowdfunding platform, creating access to commercial grade oil & gas investments.

Overview

Raised to Date: Raised: $898,399

Total Commitments ($USD)

Platform

Netcapital

Start Date

12/01/2020

Close Date

02/25/2021

Min. Goal
$10,000
Max. Goal
$1,067,192
Min. Investment

$99

Security Type

Equity - Preferred

Series

Pre-Seed

SEC Filing Type

RegCF    Open SEC Filing

Price Per Share

$1.14

Pre-Money Valuation

$11,400,000

Rolling Commitments ($USD)

Status
Funded
Reporting Date

02/27/2021

Days Remaining
Funded
% of Min. Goal
Funded
% of Max. Goal
Funded
Likelihood of Max
Funded
Avg. Daily Raise

$10,447

Momentum
Funded
Create a free account today to gain access to KingsCrowd analytics.
Year Founded

2019

Industry

Financial & Insurance Products & Services

Tech Sector

Fintech

Distribution Model

B2C

Margin

Medium

Capital Intensity

Low

Location

Lakewood, Colorado

Business Type

Growth

PetroFunders, with a post-money valuation of $12.4 million, is raising funds on NetCapital. It is a premier crowdfunding platform that allows investors to invest in oil and gas. The platform makes investing simpler with its synchronized platform that combines crowdfunding, fintech, and industry experience. Maurice Dukes and Ryan Werking founded PetroFunders in September 2019. The current crowdfunding round has a minimum goal of $10,000 and a maximum goal of $1,067,192, and the proceeds will be used towards marketing, staffing, tech support, insurance, and other expenses. PetroFunders is offering a low price entry point for investors in the oil and gas sector, especially during the current challenging times of COVID-19.

Summary Profit and Loss Statement

Most Recent Year Prior Year

Revenue

$0

$0

COGS

$0

$0

Tax

$0

$0

 

 

Net Income

$-1,493

$0

Summary Balance Sheet

Most Recent Year Prior Year

Cash

$0

$0

Accounts Receivable

$0

$0

Total Assets

$0

$0

Short-Term Debt

$0

$0

Long-Term Debt

$0

$0

Total Liabilities

$0

$0

Financials as of: 12/01/2020
Create a free account today to gain access to KingsCrowd analytics.

Upgrade to gain access

Pay Monthly
Annually (Save 17%)

Edge

$25 /month
billed annually
Free portfolio tracking, data-driven ratings, AI analysis and reports
Plan Includes:
Everything in Free, plus
Company specific KingsCrowd ratings and analyst reports
Deal explorer and side-by-side comparison
Startup exit and failure tracking
Startup market filters and historical industry data
Advanced company search ( with ratings)
Get Edge Annual
Already a member? Log in here.

Ratings KingsCrowd Startup Rating Methodology Article

Blurred Ratings Bars Blurred Ratings Bars

Analyst Report Analyst Report Methodology Article

Synopsis

PetroFunders is an online platform for investing into oil and gas companies. The business gives retail investors the ability to invest in companies that would previously be unavailable to them. The founding team brings over 100 years of experience in oil and gas companies, which is a good way to instill confidence in potential investors early on.

The PetroFunders team noticed that there exists no easy and streamlined way for retail investors to access smaller, more tailored products within the oil and gas industry. Their business model capitalizes on the growing prevalence of crowdfunding (which, as a whole was valued at $13.9 billion in 2019 and is projected to rise to $39.8 billion by 2026) and gives investors the opportunity to profit from their platform.

The current state of oil and gas prices may make it seem like an industry to stay away from, but these are products that will be around for many years more (despite the recent trend of renewable energy and EV stocks increasing drastically). Once the pandemic is a thing of the past, oil and gas companies look like investments that could reward the patient investor – which PetroFunders wants to take advantage of.   

The KingsCrowd investment team has rated PetroFunders’ current NetCapital raise as a Neutral Deal.

Next Section: Price

Price

PetroFunders is raising at a $11.4 million valuation cap with no discount. At its current valuation, PetroFunders is trading at $1.14 a share. This price is quite high given the company’s current stage of development. The lack of a discount also reduces the incentive for prospective investors. Thus, PetroFunders’ price score is quite low.

Next Section: Market

Market

The COVID-19 pandemic and the incoming Biden administration has caused capital markets to move away from oil and gas and into renewable technology. This market shift has given a company like PetroFunders a unique opening to find alternative ways to fund smaller oil and gas companies. According to PetroFunders themselves, they see a total available market of $75 billion needed by smaller companies that may turn to crowdfunding. The global oil and gas market sits at a lofty $3.2 trillion in 2020, and there are many small cap companies that are in need of an injection of capital. PetroFunders provides the platform for this symbiotic relationship to take hold. PetroFunders also estimates a SOM (Serviceable Obtainable Market) of $1.5 billion for them to capture through their business. PetroFunder’s market score is above average in reflection of this sizable opportunity.

Next Section: Team

Team

CEO Maurice Dukes and COO Ryan Werking co-founded PetroFunders in 2019. Dukes has previous experience working at Caerus Oil & Gas, where he maintained and built the company’s enterprise value to over $1 billion. He holds a B.S in Petroleum Engineering from the University of Oklahoma. His co-founder Ryan Werking previously founded a contracting company that specialized in financial modeling — with clients including various national oil companies. He holds a B.S in Petroleum Engineering from Colorado School of Mines.

On the financial side, they are joined by finance lead Scott Sloan (30 years of experience in the oil and gas industry) and Chief Investment Officer Stephen Gornick (also 30 years of experience). The team at PetroFunders brings a wide breadth of knowledge and experience in leading and working with oil and gas companies. The team is one of the strongest aspects of the young company, as reflected by its strong team score.

Next Section: Differentiators

Differentiators

PetroFunders is differentiated in the way that it is entering into a niche space — that being oil and gas crowdfunding. The company is hoping that there are enough retail investors out there who would see its platform as something that would enhance their investment strategy. Given the lack of name recognition already existing in this niche space if there are enough people who want to utilize PetroFunders’ services, there are few options to turn to aside from PetroFunders.

That being said, there are other adopters to this space that do pose a challenge to PetroFunders. EnergyFunders is a company with a similar business model that encompasses the entire energy space. PetroFunders is differentiated by being specific to oil and gas – which could work in their favor. PetroFunders’ differentiators score is the company’s strongest due to this clear distinction from current competition.

Next Section: Performance

Performance

PetroFunders’ online crowdfunding platform has been fully built and launched. In the company’s first offering on the platform, $1.91 million was raised from 15 different investors. This initial success shows that the product has viability. However, PetroFunders is still very early stage, and there is no financial data available on the company’s operations. This lack of information creates substantial risk for investors, since there is no insight into the firm’s operations cost, cash flow, potential debt, or margins. Therefore, PetroFunders’ performance score is its worst across all five metrics and is extremely low.

Next Section: Other

Bearish Outlook

The company may have conducted one successful listing as of yet, but there is no guarantee that PetroFunders has a business model that will scale to the levels of a billion-dollar business. Simply put, are there enough people out there who would utilize a platform that allows them to invest in smaller oil companies? Even in their successful listing, only 15 unique investors participated. Is that enough people to indicate that there is, or ever will be, an active enough user base to propel PetroFunders into success? Adding to these concerns are the company’s high valuation with no discount. Concerns over long term operation success paired with a questionable reward for early investors are both worrying marks against PetroFunders.

Next Section: Bullish Outlook

Bullish Outlook

The COVID-19 pandemic has given investors the opportunity to make “buy low, sell high” into a reality. Oil stocks are being traded at a huge discount as compared to previous years’ prices. If enough investors believe that a massive, industry wide rebound is due, they may be driven to use PetroFunders to invest.

PetroFunders is a young platform and has already seen a successful, million dollar listing on its website thus far. Combine this proven traction with an experienced leadership team and a successful future for PetroFunders seems attainable.

Next Section: Executive Summary

Executive Summary

PetroFunders provides a platform for retail investors to find and put money into smaller cap oil and gas stocks. The company has offered one listing on its platform thus far, which drew 15 investors and raised a total of $1.91 million. Final due diligence of legal terms prompted PetroFunders to halt the deal and refund money, but the traction that Petrofunders’ platform showed is reason to believe in future success.

However, oil and gas prices have been decimated due to COVID-19, and money has been slow to move around the industry. This is a looming issue for a company like PetroFunders, as its business relies on retail investors finding small, unique oil and gas companies to invest in. It also has a competitor in EnergyFunders who poses a threat to occupy some of the same market share. While the path to profitability for PetroFunders is imaginable, these roadblocks do provide cause for concern. Therefore, PetroFunders has been rated a Neutral Deal by the KingsCrowd investment team.

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

Analysis written by Ethan Thomas.

Founders: enhance your startup's credibility on KingsCrowd. Create an account to claim this raise page.

Create your first portfolio

Create your own startup investment portfolio on KingsCrowd.

Track all of your startup investments in one place using our state-of-the-art portfolio tracker tools. To begin, create your first portfolio below.

Add to portfolio
PetroFunders on NetCapital
Platform: Netcapital
Security Type: Equity - Preferred
Valuation: $11,400,000
Price per Share: $1.14

Follow company

Follow PetroFunders on NetCapital

Buy PetroFunders's Deal Report

Warning: according to the close date for this deal, PetroFunders may no longer be accepting investments.

PetroFunders Deal Report

Get KingsCrowd’s comprehensive report on PetroFunders including:

  • How our proprietary algorithm rates their current capital raise (1-5 stars)
  • Detailed price, market, team, differentiators, performance, and risk ratings
  • Whether PetroFunders is undervalued or overvalued
  • Scores on the founding team and key personnel's background and expertise
  • Our deep-dive analyst report reviewing the deal's investment potential and bullish vs. bearish outlook

Buy the PetroFunders deal report for only $10!

Email address:
Looking to buy more than one deal report? Get unlimited reports by upgrading to Edge