Zing

Early Stage

Drone Delivery Platform

Analytics

Raised to Date: Raised: $122,161

Aggregate Commitments $

Platform

Wefunder

Start Date

01/10/2022

Close Date

04/28/2022

Min. Goal

$50,000

Max. Goal

$750,000

Min. Investment

$250

Security Type

SAFE

Funding Type

RegCF

Series

Pre-Seed

Valuation Cap

$7,500,000

Discount Rate

0%

Rolling Commitments $

Status
Funded
Reporting Date

05/01/2022

Days Remaining
Funded
% of Min. Goal

244%

% of Max. Goal

16%

Likelihood of Max
Funded
Avg. Daily Raise

$1,131

Momentum
Funded
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Location

Palm City, Florida

Industry

Logistics, Delivery, & Supply Chain

Tech Sector

MarketplaceTech

Distribution Model

B2B2C

Margin

Medium

Capital Intensity

Low

Business Type

Growth

Zing, with a valuation of $7.5 million, is raising funds on Wefunder. The company is revolutionizing last-mile delivery with its drone delivery platform. The platform makes drone delivery fast, affordable, and accessible to local businesses and customers. Zing has generated over $10,000 in revenue in August 2021 and has more than 3,000 licensed drone pilots. The business has also secured multiple strategic partnerships with leading industry players. Ian Annase founded Zing in June 2018. The current crowdfunding campaign has a minimum target of $50,000 and a maximum target of $750,000. The campaign proceeds will be used for hiring, marketing, regulatory approvals, and product development.

Summary Profit and Loss Statement

Most Recent Year Prior Year

Revenue

$4,464

$0

COGS

$4,300

$0

Tax

$474

$139

 

 

Net Income

$-19,546

$-13,343

Summary Balance Sheet

Most Recent Year Prior Year

Cash

$0

$16,099

Accounts Receivable

$0

$0

Total Assets

$12,512

$20,853

Short-Term Debt

$3

$0

Long-Term Debt

$0

$0

Total Liabilities

$3

$0

Financials as of: 01/10/2022
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Ratings KingsCrowd Startup Rating Methodology Article

Analyst Report Analyst Report Methodology Article

Synopsis

The COVID-19 pandemic accelerated many new tech trends, from remote work to virtual events. Quarantine conditions also reshaped how many consumers get their meals. The market for food delivery doubled during the pandemic. Even as the pandemic subsides, apps like UberEats and Postmates will remain a permanent fixture on many smartphones. 

However, a huge increase in food delivery might further climate change. Driving cars to and from restaurants to deliver food releases a lot of emissions. If deliveries are efficient enough, they can reduce emissions when compared to each individual consumer driving their car to get food, but it’s just as likely that inefficient deliveries mean more cars on the road, more disposable takeout containers, and a net loss for the environment. 

Zing hopes to use drones to revolutionize food delivery without the need to mass-produce drones. Zing invites drone enthusiasts who already have equipment and flying clearance to sign up as delivery flyers, picking up food from restaurants and dropping it off with customers. The company is still young but has already developed proprietary drone add-on hardware to enable pick up and drop off, plus apps to allow delivery flyers and restaurants to sign up. 

Zing’s current Wefunder raise has been rated a Neutral Deal by the KingsCrowd investment team.

Price

Zing is raising capital via a Crowd SAFE at a $7.5 million valuation. This price is a tad high given that Zing has generated very little revenue and is generally a very early-stage company. However, Zing’s concept seems strong, and there’s a good chance that the company could grow in value quickly if its business model takes off. Therefore, this price is a better deal for investors than most other young companies raising at a similar valuation. 

Market

There aren’t many package-carrying drones flying around cities yet, so drone delivery has a long way to go before it becomes widespread. There are a great deal of regulatory hurdles impeding progress, and it will take major companies like Uber a long time to build up a large inventory of drones with which to deliver. For all of these reasons, the market for drone delivery is still small at only about $1.5 billion as of 2021. 

However, this market is poised to grow massively as drone delivery becomes more common. Analysts predict a staggering compound annual growth rate of 53.94% for the global drone package delivery market, which would drive the total market size up to $31 billion by 2028. Zing is currently focused on food delivery, which is only one small slice of that total market, but it seems easy for the company to expand into generalized package delivery in the near future. It’s also important to note that Zing is focused on drone software rather than drone hardware, which further limits it’s addressable market.

Zing has the opportunity to be at the leading edge of a rapidly expanding market. Plus, the company could grow rapidly alongside demand given its unique business model that leverages preexisting drone equipment. Therefore, Zing’s market prospects look strong.

Team

Zing was founded by Ian Annase, a drone flyer who had the idea of pairing existing drone pilots with restaurants in need of delivery services. Annase graduated from Florida State University in 2018 with a degree in computer science and later earned his masters in product development from the same school. Other than a brief stint as a mobile software engineer, Annase has been focused on building Zing since graduation. 

The Zing team includes two other young adults: CMO Lauren Tarpley and COO Grayson Bertaina. Tarpley graduated from UNC Chapel Hill with a degree in advertising and appears to do some freelance marketing work alongside her marketing efforts for Zing. Bertaina is an avid drone pilot who previously served as Zing’s head of flight operations. He recently began undergraduate studies at MIT, so he does not work on Zing full-time. 

Overall, the Zing team is small and quite inexperienced. It’s a cause for concern that this unproven team is building a business in a market with extreme regulatory complexity and lots of competition from existing giants, like UberEats and Postmates.

Differentiators

At first glance, Zing seems to be a tiny David competing against the Goliaths of UberEats and Postmates. UberEats is known to be working on drone delivery, and all major delivery and logistics companies have likely made huge investments in drone tech over the last several years. 

Zing will compete by relying on a core differentiator from the incumbent delivery apps: using existing drone pilots and their equipment rather than investing in a company-owned fleet. With Zing, any drone pilot who owns a drone can sign up as a flyer. They buy a piece of custom equipment from Zing that allows their drone to pick up and drop off food deliveries, and the drones can then make flights similar to how Uber drivers pick up rides. Plus, Zing flyers can apparently operate several drones at once (flying is clearly semi-autonomous), which is a scale advantage over one-to-one delivery services like Postmates. 

Is this differentiator enough to allow Zing to carve out a niche within the exploding drone delivery market? It’s too soon to say, but there’s promise in the idea. Without the massive capital required to purchase or manufacture a drone fleet, Zing could scale a bit more quickly than Uber once drone delivery becomes more commonplace, at least in certain markets. Of course, Uber could adopt a similar business model to Zing, paying preexisting drone pilots. But before Uber can launch that program, Zing may have taken its competitive advantage all the way to the bank.

Performance

Zing is a very young company without a great deal of traction to brag about. Over the course of the last three years, the company has developed proprietary software and hardware that enables drone pilots to convert their existing drones into delivery devices. Zing has demonstrated this technology at a variety of events, generating some local press in Florida. Official financials through 2020 don’t show any meaningful revenue generation, but apparently Zing brought in $10,000 in revenue in 2021, which signals that stronger revenue growth may happen in the near future. 

In addition, Zing secured membership in the Federal Aviation Administration’s BEYOND program, meant to expand and test drone operations. That membership, which undoubtedly required a complex application process, will likely give Zing a leg up when drone delivery becomes more widely sanctioned.

Risks

Zing is a very young company with minimal revenue, which always increases the risk of a startup investment. Moreover, Zing operates in a highly regulated market that is almost entirely subject to the whims of the Federal Aviation Administration. Zing is also run by a small team of two full-time recent graduates and a college freshman, all with zero startup experience and very little professional experience overall. All of these factors signal that Zing is a riskier opportunity than commonly found on crowdfunding sites.

Bearish Outlook

Zing has a very large mountain to climb to achieve success. The company’s young team needs to rapidly learn how to operate a startup. The Federal Aviation Administration needs to evolve regulations and allow drone delivery to become widespread in American cities. Companies like UberEats and Postmates need to leave a sliver of space for a tiny business like Zing to carve out some market share. Drone pilots, restaurant owners, and consumers must all be interested in adopting Zing technology. All put together, these are a lot of negative signals. There’s a chance that Zing has what it takes to navigate the intensely competitive environment, begin generating revenue, and lead the revolution of drone delivery. But at this point, it’s simply too soon to tell whether Zing can make it there.

Bullish Outlook

Drone delivery still seems futuristic because it is not at all mainstream. Most people assume that if and when drone delivery is cleared by federal regulators, it will be giants like UberEats and Postmates who fill the skies with drones. Given these assumptions, it seems unlikely at first glance that Zing could succeed. However, Zing’s business model is unique and potentially groundbreaking. By hiring drone pilots as contractors and leveraging their existing drone equipment, Zing dodges the capital and development barriers that could slow even well-financed companies like Uber. That novel idea, combined with the extreme growth expected from the drone delivery market in coming years, could catapult Zing to the leading edge of a massive movement. While this is a very risky investment, it’s one that could have huge upside. 

Executive Summary

Zing is a drone delivery startup focused on building hardware (drone accessories) and software that will allow drone pilots to partner with restaurants to make deliveries. Although the market is small, it’s growing explosively and could open up great opportunities for Zing in the long run. Food delivery by drone is more environmentally friendly, more scalable, and offers a higher-quality experience for the customer than existing methods of delivery, like UberEats and Postmates. Plus, Zing’s unique business model could allow it to grow rapidly while incumbents like Uber struggle to get their in-house drone program off the ground. The company has a decent valuation considering its early stage, which could benefit early investors if Zing finds success.

On the other hand, Zing is a very young company with little traction. Its inexperienced founder and executive team might not be well-suited for scaling a business in an intensely competitive, highly regulated industry. Plus, there’s the real chance that Zing won’t be able to sign up drone pilots, restaurants, and customers quickly enough to make its multi-sided marketplace work. If that doesn’t slow the company down, a flood of competition from giants like Uber could. Therefore, Zing has been rated a Neutral Deal. 

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

Analysis written February 3, 2022.

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Zing on Wefunder 2022
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Platform: Wefunder
Security Type: SAFE
Valuation: $7,500,000

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