VibeTech Enterprises

Early Stage

Revolutionary therapeutic vibration technology to reduce falls in older adults

Analytics

Raised to Date: Raised: $356,330

Aggregate Commitments $

Platform

Wefunder

Start Date

11/04/2020

Close Date

04/11/2021

Min. Goal

$330,007

Max. Goal

$1,069,993

Min. Investment

$300

Security Type

Equity - Common

Funding Type

RegCF

Series

Seed

Pre-Money Valuation

$14,039,116

Rolling Commitments $

Status
Funded
Reporting Date

04/30/2021

Days Remaining
Funded
% of Min. Goal

108%

% of Max. Goal

33%

Likelihood of Max
Funded
Avg. Daily Raise

$2,255

Momentum
Funded
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Location

Sheboygan, Wisconsin

Industry

Fitness & Wellness

Tech Sector

Medtech

Distribution Model

B2B/B2C

Margin

High

Capital Intensity

High

Business Type

Growth

VibeTech Enterprises, with a pre-money valuation of $14 million, is raising funds on Wefunder. The company makes and sells a therapeutic vibration solution that reduces the rate of falls in older adults. The device finds use in hospital systems, health insurance companies, and older-adult care facilities. VibeTech Enterprises was founded by Jeff Leismer in 2018 and has raised over $1.9 million since its inception. The current round of crowdfunding has a minimum goal of $330,007 and a maximum goal of $1,069,993, and the proceeds will be used for new product development, enhancement of customer support functions, software development for user data accumulations, and working capital. VibeTech Enterprises won McKnight’s Excellence in Technology Innovator of the Year Gold Award in 2020.

Summary Profit and Loss Statement

Most Recent Year Prior Year

Revenue

$45,040

$5,400

COGS

$0

$220

Tax

$0

$0

 

 

Net Income

$-368,180

$-260,226

Summary Balance Sheet

Most Recent Year Prior Year

Cash

$19,170

$9,657

Accounts Receivable

$0

$0

Total Assets

$29,265

$16,817

Short-Term Debt

$272,512

$386,014

Long-Term Debt

$1,581,373

$1,087,243

Total Liabilities

$1,853,885

$1,473,257

Financials as of: 11/04/2020
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Ratings

Analyst Report

Synopsis

The United States is facing an ongoing, long-term graying effect. That is, the median population is going up in age. As of 2016, 15.2% of Americans were over 65. By 2030, it is estimated that 1 in every 5 Americans will hit that milestone. This phenomenon is by no means unique to the U.S., but it presents unique problems for developed nations. As people live ever-longer lives while leaving the workforce, they often require expensive elder care to deal with emerging health problems such as dementia and other chronic illnesses.

This places a heavy burden on developed economies, as we can see in places like Japan. Expanding nursing homes and medical facilities require ever-more caregivers. Adult children of the elderly face exorbitant prices for parents’ assisted living and life-preserving surgeries. On top of that, elderly populations face personal challenges in the form of debilitating illnesses and the loss of their autonomy, which can be psychologically devastating. Surgeries intended to preserve their lives can result in lower quality-of-life overall.

In this era of a graying population, every measure that can alleviate any of the myriad challenges of ageing is an investment with huge returns. VibeTech Enterprises is offering one such investment through an innovative technology with promising early results. The concept: therapeutic vibration, originally developed to combat bone atrophy in astronauts. The technology employs vibrations to simulate the effects of aerobic activity on the human body. Essentially, it offers the benefits of physical exercise to those that cannot engage in it. 

The technology can have massive benefits for all manner of elderly patients. VibeTech has put its limited resources to use assisting elders with a history of falling, a type of injury that results in around $50 billion in medical expenses a year. The technology can also assist patients recovering from surgery or who are otherwise incapable of regular exercise. The machine is essentially a leg press that sends vibrations through muscles in the patient’s legs and lower back. The product is currently intended for hospitals and long-term care facilities, as well as for health insurers. As the technology develops, VibeTech hopes to add at-home versions to the market, allowing greater numbers of the elderly to gracefully “age at home.”

VibeTech Enterprises’ current WeFunder raise has been rated a Neutral Deal by the KingsCrowd investment team.

Price

VibeTech Enterprises is raising at a $14,039,116 valuation, without discount. This valuation, despite low revenue in the past year and significant debt, reflects hope for an innovative product in a generally lucrative market. However, the lack of discount and revenue are strikes against VibeTech, resulting in a low price score for the company.

Market

As an experimental technology, VibeTech’s therapeutic machines are quite expensive — limiting possible consumers. That said, costs could be mitigated by health insurance, and nursing homes might do well to invest in the product for the benefit of their residents. In the long term, the target market continues to grow as the U.S. population ages. Falls are the leading cause of lethal and nonlethal injuries among the elderly, and consumers are looking for preventive measures. In the short term, however, restrictive measures due to COVID-19 have forced some elder care facilities to close and others to adopt financially-punishing restrictions such as hiring more staff and spacing out facilities, even as residents die in high numbers.

In addition, Americans tend to underspend on preventive care for all kinds of chronic conditions. This could present a marketing problem for VibeTech, depending on whether the technology is perceived as a cost-saving rehabilitative tool or an expensive gimmick.

Overall, the target market is decent — but the timing of a global pandemic has thrown a wrench into VibeTech’s economic gears. Thus, the company’s market score is middle of the road.

Team

VibeTech Enterprises’ founder and CEO is Jeff Leismer, an experienced biomechanical engineer and director of technology with a PhD in Mechanical Engineering from the University of Florida. After developing the technology working with NASA, Leismer has secured 10 patents and led his company to win McKnight’s Excellence in Technology Innovator of the Year for Skilled Nursing Gold Award in 2020.

Shoring up the team are Ed Morgan and Donna Rippin, who serve as CFO and Sr. VP of Strategy and Branding, respectively. Morgan is a financial veteran, having more than 25 years of experience in financial counseling for various business owners and investors. Rippin has spent her career going in-depth into brand management and growth, spending three years as a senior executive partner with the U-Group LLC. She also currently serves as CEO and founder of the Business Brains Group, an organization focused on supporting business growth.

Overall, VibeTech Enterprises enjoys the support of a strong and competent team, as reflected in its above average team score.

Differentiators

Falls are a huge problem among older adults. However, industry innovations seem largely centered around mitigating damage through alert systems and environmental restructuring, such as installing grab bars and removing slippery surfaces from the home.

VibeTech Enterprises’ technology has proven results and is supported in part by NASA, which offers it credibility. The technology is innovative and seems to have proven successful in its limited distribution. Studies of vibration therapy in general seem inconclusive on its benefits, so VibeTech’s successes are particularly promising. VibeTech’s device also employs a trademarked SmartDosing system which does not require the attendance of a trained physician. The system is based on a subscription service for updates, another source of future continuing revenue.

Overall, VibeTech’s patented technology and early success indicators combine to give the company a very high differentiators score.

Performance

Since summer of 2018, VibeTech has been engaging in experimental therapy with small groups, through a laboratory in Sheboygan, Wisconsin. The company has also provided more than 20,000 treatments. Over that time, it has seen high levels of pain reduction and significant increases in leg strength among patients. The company has yet to reach a point where it can produce their product commercially and make a profit.

Despite being pre-profit, VibeTech’s early studies and promising treatments are indicative of encouraging early traction for the company. Thus, its performance score is strong.

Bearish Outlook

As turmoil rocks nursing homes and the healthcare industry changes dramatically in the U.S., VibeTech has no guarantee of successful commercialization. The product is expensive. With hospital facilities, nursing homes, and at-home patients alike all facing financial strain due to the global pandemic, there may simply be little opening for the company to market its products.

While the company plans to produce cheaper models and enhance customer support capabilities, it may be some time before their innovation can see success among the general market. Furthermore, as seniors switch from communal care facilities to at-home care by therapists, spooked by high COVID-19 cases, the market may become less centralized and difficult to target effectively. Much will depend on how long COVID-19 restrictions last and how quickly the elder care industry can recover from the pandemic’s impact.

Bullish Outlook

As America’s population grows older, falls remain an ever more pressing problem for elder care. VibeTech’s technology has shown early effectiveness. With the funding to develop models that are smaller and easier-to-use, the company can broaden its appeal to care facilities and individuals alike. Over the long term — by proving itself in the early stages of the U.S.’s graying phase — VibeTech can emerge as an industry leader in preventing falls and expand its product offerings beyond that niche market into providing therapy for other physical illnesses.

Executive Summary

VibeTech Enterprises is producing an experimental therapeutic vibration machine that simulates the effects of exercise on patients’ legs and lower body, strengthening elderly populations that might be vulnerable to falls but are incapable of traditional aerobic exercise. The technology is expensive, but VibeTech plans to create a cheaper version and commercialize it with additional funding, while improving user-friendliness of their trademark SmartDosing program.

Unfortunately for VibeTech Enterprises, the COVID-19 pandemic has had a significant impact on its target market. Nursing homes and individuals have seen a reduction in financial wherewithal to spend on preventive care, and as a cheaper version is still forthcoming, the product faces a challenging market in the immediate future. Therefore, VibeTech Enterprises has been rated a Neutral Deal.

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

Analysis written by Benjamin Potts.

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