The smart home, is getting a whole lot smarter.
trutankless®: Public Company OTCQB Symbol TKLS, is using patented technology to improve a better bottom line for homeowners as well as shareholders.
Arizona based trutankless, Inc. develops, manufactures and distributes electric tankless water heating systems within the United States. The company boasts 34 issued patent claims and is using the most sophisticated and efficient water heating technologies to penetrate the water heating market in the US, where nearly half of the 8.75 million water heaters sold in 2018 are fueled with electricity(1). trutankless® electric-powered products aim to offer better performance and create efficiency for homeowners to save money, have a continuous supply of hot water, and more complete control over their home environment with smart phone apps and home automation functions.
Using a full commercialization, blue-chip manufacturing partner and the wholesale plumbing distribution network, the company is capturing the market through plumbing services franchises and homebuilding companies in its target markets. Existing markets include : Phoenix, Orlando, Dallas, Jacksonville, and along Florida’s gulf coast.
Market Environment And Insulation From Housing Cycles
We believe what makes trutankless® a unique opportunity is two-fold: The replacement market for water heating systems is the majority of shipments(2) and it currently represents 85% of the company’s business, versus the new home building market. While we conduct business with companies such as Lennar, DR Horton, Shea Homes, and Cullum Homes, the NAHB’s Custom Home Builder of the Year(3), this “New Home Market” is a relatively small component of the company’s ability to scale sales. Compared to our overall revenue stream, we believe the economic cycles that affect new construction should not have a material impact on potential sales. Management is very proud to be an approved vendor for top national homebuilders because they represent a very large opportunity for growth in any economic cycle. We believe additional relationships in the new construction industry will materially impact sales volume.
A Motivated Consumer
Recent government regulatory changes(4), coupled with a consumers’ desire for more efficient home technology, and the ability to connect the home environment meaningfully(5), are all expected to drive demand and sales for the company’s products. More than half of U.S. consumers plan to buy a smart-home device in the next two years, and of those who already own one, 84 percent plan to buy another one(6). Additionally, 61% of households purchase energy efficient products to save money(7).
Ramping Up Sales
In 2017 trutankless® delivered sales of 900 units and generated nearly $700,000 in revenue. By the end of 2018, the company achieved sales of almost 2,000 units and generated more than $1,500,000 in revenue (Unaudited Estimate). With our 2019 capital raise underway, and assuming a successful raise, we expect we can execute the next leg of our growth strategy, which we expect to allow for a triple in sales. Investment in additional sales and marketing professionals, allow us to begin attacking other large markets like Miami, San Antonio, Houston, and the Carolinas in the south where new construction and electric water heating tends to be prevalent(8,9). The company has received numerous accolades and awards to date as evidence their product and brand recognition take hold(10).
Manufacturing Through Sinbon
Headquartered in Taiwan with additional operations in China, Japan, South Korea, the U.K. and the United States, SINBON manufactures for some of the largest electronics companies in the world. Lenovo, LG, Samsung, Siemens, Sharp and Sony, just to name a few(11). The relationship allows for the flexibility of short term demand manufacturing and maintenance of competitive logistics and pricing. However, given the recent ramp up in sales, gross margins of nearly 30% are expected dramatically increase to 50% later in 2019.
trutankless® created a distribution network by having best in class products that the wholesale supply channel and their customers are adopting at an accelerating rate. We specifically avoided the “Big Box” stores that were available to us, and watched as predecessor companies in the tankless space, suffered the scars of dealing directly with the consumer, experienced margin compression from discount retailers, and witnessed the fallout of manufacturer’s reps unwilling to sell products also being sold through the retail channel and directly to consumers.
According to consumer reports, gas tankless units by comparison are also much more expensive to install than the electric version(12), and they’re also known to have issues with sediment build up requiring regular maintenance. trutankless® has proven in the lab and in the marketplace, not to have similar problems. According to the company it is a major competitive advantage to be the only electric tankless heater which is sold exclusively through the wholesale plumbing channel which management believes creates brand loyalty.
Some of our distribution partners include nationally known distributors Ferguson, Hajoca, WinSupply, and high volume regional companies like Morsco, HydroLogic and Southern Pipe. Major plumbing supply companies, catering to industry pros and most home builders, have more locations than national big box retail stores.
Capital Raising Activities
The company has a well-defined growth strategy that incorporates more sales professionals aim to penetrate the previously identified new markets. Additional investment for enhanced marketing and branding and most importantly, more production capacity are all planned. In addition, the company plans on investing a portion of the capital proceeds for public relations and investor relations efforts to improve the overall liquidity in the public market for their stock.
Amount: $4.025 Million
Price: $0.35 unit
Unit Includes: 1 share common/1 warrant
Warrant Price: $0.50 exercise
Warrant Expiration: 5 years
Early Redemption: Redeemable at $0.10 per warrant at Company’s option
(subject to notification and exercise by holder.)
Total Issuance: 11.5 million units = 11.5 million common shares and 11.5 million warrants
Minimum Offering: $750,000
Managing Director Boustead Securities
Managing Director Boustead Securities
Michael Stebbins: President
Safe Harbor Statements
This communication contains statements that the company believes are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally can be identified by the use of words such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “forecast,” “guidance” or words of similar meaning. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated as of the date of this communication. Important factors that could cause actual results to differ materially from these expectations include, among other things, the following: uncertain costs, savings and time-frames associated with the implementation of the plans of company management; potential weakening in the high efficiency water heater market; significant volatility in raw material prices; competitive pressures on the company’s business; inability to implement or maintain pricing actions; instability in the company’s target markets; potential weakening in U.S. residential or commercial construction; foreign currency fluctuations; the ability to execute our cost reduction and product improvement strategy; and adverse general economic conditions and capital market deterioration in the U.S., Canada, Taiwan, and China. For a more detailed discussion of these factors see the Risk Factors discussion in the trutankless, Inc. Form 10-K for the year ended December 31, 2017. Forward-looking statements included in this report are made only as of the date of this report, and the company is under no obligation to update these statements to reflect subsequent events or circumstances. All subsequent written and oral forward-looking statements attributed to the company, or persons acting on its behalf, are qualified entirely by these cautionary statements.
This is not an offer to sell or a solicitation of any offer to buy any securities. Offers are made only by prospectus or other offering materials. To obtain further information, you must complete an investor questionnaire and meet the suitability standards required by law.
There is no guarantee that a specific outcome will be achieved.
An energetic serial entrepreneur, Mr. Orr brings a wealth of strategic business development knowledge and expertise to Trutankless, Inc. In 1998, Mr. Orr became a founding partner of Bluemedia, Inc., one of the nation’s leading signage and large-format graphics companies headquartered in Tempe, Arizona. As the company’s Sr. Vice President of Sales and Business Development, Mr. Orr has led Bluemedia’s impressive...Expand Bio
An energetic serial entrepreneur, Mr. Orr brings a wealth of strategic business development knowledge and expertise to Trutankless, Inc. In 1998, Mr. Orr became a founding partner of Bluemedia, Inc., one of the nation’s leading signage and large-format graphics companies headquartered in Tempe, Arizona. As the company’s Sr. Vice President of Sales and Business Development, Mr. Orr has led Bluemedia’s impressive 28% annual growth rate and fostered the recent acquisition of Skyline Signs.
In 2005, Mr. Orr and his partners funded another venture, Blind Society, an award-winning advertising and branding agency in Scottsdale, Arizona. Blind Society boasts an impressive client roster which includes the Arizona Cardinals, AT&T, Phoenix Coyotes, Four Peaks Brewery, Warner Brothers, Pixar Entertainment and Mojo Yogurt.Collapse Bio
As Founder and President of Trutankless, Inc., Michael is directly involved in the day to day operations of the company, from business development and strategic decision making to overseeing sales and marketing as well as new product development. Michael helped lead the design team that created the award-winning Trutankless water heater, which resulted in a series of advancements that were novel to the water...Expand Bio
As Founder and President of Trutankless, Inc., Michael is directly involved in the day to day operations of the company, from business development and strategic decision making to overseeing sales and marketing as well as new product development. Michael helped lead the design team that created the award-winning Trutankless water heater, which resulted in a series of advancements that were novel to the water heater business.
Recently recognized as one of Arizona’s Top “35 Under 35” Entrepreneurs, Michael is committed to building Trutankless into a dynamic brand known for quality and innovation.Collapse Bio