Leo AR by MojiLala is an augmented reality app that has a freemium business model. The company, which is still in the early stages, is also raising capital through a crowdfunding campaign on StartEngine. The minimum to invest in Leo AR stock is $250.
The co-founder and CEO is Dana Loberg, a serial entrepreneur in the mobile app space. Along the way she has participated in a variety of incubators, such as Stanford Start X, Quake Accelerator, betaworks, and 500 Startups. As for her education, she studied visual arts at Yale. She then went on to work at ad agencies like McCann Erickson and J. Walter Thompson.
Her co-founder and CTO of Leo AR is Sahin Boydas, who is also a serial entrepreneur and has worked with Loberg with other ventures. Currently, he works part-time as the CEO of RemoteTeam.com.
What It Is
With the Leo AR app, you can create immersive AR (Augmented Reality) experiences. That is, you can embed 3D and animated objects within the videos from your smartphone.
But with the Leo AR app, you do not have to be tech-savvy to do this. The app comes with hundreds of objects to work with. There are also tools to enhance the graphics, such as prompting a digital a unicorn to dance in your bedroom. According to the company’s website: “Leo allows everyone to see the world as their canvas, with the ability to showcase everyone’s wildest dreams in this realm.”
As for the market opportunity – which is definitely critical for whether to invest in Leo AR stock – it is large. The spending is forecasted to go from $10.7 billion in 2019 to $72.7 billion by 2024. This represents a 45% compound annual growth rate. What’s more, with the impact of the novel coronavirus, there is likely to be even more adoption of AR technologies. The growth in 5G phones will also be a strong catalyst. The technology allows for speeds of up to 100 times more than 4G systems.
Note that Leo AR has a partnership with Samsung and its app is the only one highlighted in the Galaxy Store for the “Made for Samsung” program. The app has also been showcased in all Apple (NASDAQ:AAPL) stores.
Such efforts have helped to create more than $100,000 in sustainable revenue and the month-over-month growth rate is 10%. While the company has not disclosed the number of users, the app has seen more than eight million videos created.
Should You Invest in Leo AR Stock?
For its equity crowdfunding round, the company has raised more than $52,000 from over 70 investors. The valuation is at $15 million.
Leo AR is offering a convertible note. This means that you will not receive equity until there is a trigger event, such as a subsequent funding, IPO (Initial Public Offering), or acquisition.
The investment also comes with perks that are based on the amount committed. For example, if you invest between $2,500 to $5,000, you will get a 2% bonus on the convertible note interest rate.
Of course, when it comes to private investing in startups, there are notable risks. For Leo AR, there are the challenges with getting consumers to pay for apps. There must be a clear-cut value proposition. Next, there are many AR apps on the market, so it is extremely difficult to stand out. Finally, there is an usually high churn rate for consumer mobile apps. This is especially problematic for Leo AR since it is focused on younger people, who can be fickle.
In other words, before making an investment in this venture, it’s advisable to do your own analysis and see that if it fits within your diversification requirements.
Tom Taulli (@ttaulli) is an advisor/board member for startups 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.