Bext360 is a SaaS platform that uses blockchain to help streamline supply chains. To ramp up the growth, the company is pursuing an equity crowdfunding campaign through SeedInvest. The minimum to invest in Bext360 stock is $1,000.
Daniel Jones co-founded the company back in early 2015 (he is currently the CEO). He is a serial entrepreneur, having created companies like Bolt Industries and Pioneer Management (a company involved evaluating supply chains). He also has experience in emerging and frontier markets like China, the Democratic Republic of Congo (DRC), and India.
The other co-founder of Bext360 is Dean Kingston (he is currently serving as the chief operating officer). For the past 20 years, he worked as a mechanical engineer. He has helped create robotic instruments for diagnostic products and plant automation.
How It Works
Global supply chains can lead to a variety a problems like fraud, contamination, and even human trafficking. Because of all this, there have been more regulatory requirements. This often is about bringing more transparency and sustainability. Yet the regulations can be extremely difficult for companies to comply with, especially smaller ones that do not have the resources to hire legal advisors.
Bext360 believes it has the solution. It’s platform helps manage all the key steps in the supply chain. There is also an API (Application Programming Interface) system that allows for the embedding of Bext360 functions in websites, enterprise applications, point-of-sale systems, and so on.
What about blockchain? This is for providing a rock-solid record for the data collection and verification. It’s bolstered with AI (Artificial Intelligence), computer vision, and bio/synthetic markers for better tracking.
Something else to keep in mind: the tokenization of assets – based on quality and value – means that small- and mid-size producers can have better access to lending sources. In other words, this allows for more fairness within the supply chain.
In terms of the market opportunity – which is certainly key for whether to invest in Bext360 stock – the investor materials are somewhat vague. They point out that the “core commodities” segment is $210 billion per year and that a 1% share would be $2.1 billion. Yet this is a stretch. Why use 1%? There is no elaboration on this point.
Perhaps a better approach would have been to list the number of potential customers of the cloud system and what the average annual spend would be. All in all, this would provide a reasonable TAM (Total Addressable Market) estimate.
However, Bext360 has been getting traction on the top line. From 2018 to 2019, revenues jumped from $85,000 to $345,000. The company projects that revenues will hit about $1.1 million this year.
Bext360 also has favorable SaaS metrics. For example, the estimated lifetime value of a customer is $153,000 but the acquisition cost is only $30,500.
Should You Invest in Bext360 Stock?
Regarding the equity crowdfunding round, the company has commitments for a modest $8,500 (the valuation on the round is $7.8 million). Although, there remain 48 days for the capital raise.
Keep in mind that Bext360 has already raised several rounds of funding. The largest was for $2.5 million, which was secured in April 2018.
As is the case with any private investing deal, there are substantial risks. Consider that many startups either fail or just stall. This is why it is important for investors to diversify across different investments.
As for Bext360, the company does face lots of competition. There are not only a variety of startups but also large tech firms that provide supply chain solutions. Moreover, the the Bext360 investment profile does not provide details on how the technology stacks up compared to its rivals.
So before making an investment, it’s important to do your own analysis and due diligence.
Tom Taulli (@ttaulli) is an advisor and author of various books and online courses about technology, including Artificial Intelligence Basics, The Robotic Process Automation Handbook and Learn Python Super Fast. He is also the founder of WebIPO, which was one of the first platforms for public offerings during the 1990s. As of this writing, he did not hold a position in any of the aforementioned securities.