GoldenCare Campaign (<=17% annualized rate)
GoldenCare is an elder day-care start-up that is not yet profitable. $150k one-year loan at up to 17% annualized rate is sought for working capital purposes. Equal monthly repayment amounts. Personal guarantees by its two founders. Campaign closes on 26 August 2015.
- GoldenCare Group (http://www.goldencare.sg/) is an elder day-care centre located at GB Point, Kallang Bahru.
- As a private operator, it has very few direct competitors. Most elder-care services are provided by the government or social agencies (e.g. NTUC, St Luke’s).
- According to management, there is a large demand for elder care services in Singapore. Existing elder-care facilities have long waiting queues for admission.
- Company began operations last year, and is not yet profitable. It currently has about 30 clients monthly; break-even point is about 40 clients per month. Current facilities can accommodate up to 100 clients.
- Marketing: door-to-door flyers, Internet advertising, collaborations with SAFRA and referrals from hospitals.
- Staffs & operations: Professional team include nursing staffs and therapists.
- Founders and key shareholders are Joya Zhao (CEO) and Sim Kah Cheng (COO). Joya is an entrepreneur and her latest landmark project is “iCarClub” – a car P2P rental app. Sim comes with 20 years of nursing experience with various medical-related companies and hospitals.
Financial Information (based on Jan-June 2015)
- Turnover: between $100k to $200k
- Earnings: between -$100k to $120k
- Cash Balance (Avg 3 mths): $60-70k
- Debt / Equity: 0.17x
- Current Ratio: 5.63x
Crowdfunding Campaign Details
- Campaign Platform: MoolahSense (https://www.moolahsense.com/)
- Loan amount $150k, up to 17% annualized rate (monthly rate x 12).
- Amortizing loan; equal monthly repayment amounts over 12 months.
- Personal guarantees provided by Joya and Sim
- Loan is for working capital. Management aims to spend on marketing
- DP Credit Rating: DP8, Probability of Default >16.5%
My initial thoughts
- Privately-run elder day care is a niche area, but GoldenCare may benefit from first mover advantage. There is strong demand and long queues and government- and social-run centres.
- COO Sim comes with 20 years of nursing experience and should manage staffs and daily operations well.
- The key risk is whether GoldenCare can increase its client base so that it turns profitable quickly. Management says that it is close to break-even. Other risks include event risks (e.g. accidents, food poisoning).
Disclaimer: The author is not affiliated with crowdfunding platform companies and borrowing companies. However, he may be an investor in crowdfunding campaigns. Information provided may are obtained from external sources and may contain views by the author. Crowdfunding as investing may not be suitable for everyone. No financial advice or recommendation is provided. Caveat Emptor.