On Black-owned food delivery startup Black and Mobile’s fourth anniversary next week, the company will publicly launch its $1 million equity crowdfunding campaign.
Technical.ly heard about the concept nearly a year ago, when cofounder David Cabello said he was interested in equity crowdfunding because it reminded of the community- and mission-driven nature of the business he started with brother Aaron Cabello in February 2019.
In early 2022, the company was working to relaunch in five cities — Philly, Atlanta, Baltimore, New York and Los Angeles — after working through some technological kinks. It’s currently operating in these cities, and looking to expand in the near future. Though David Cabello said the company does plan to pursue a traditional venture capital seed round next year or the following, the leadership team wanted the people who actually support their business, including customers, drivers and local business operators, to have a chance to invest.
“You know, people who aren’t just making the rich richer,” Cabello said. “I wanted the people who actually support our business to have an in on this round.”
Black founders are often left out of traditional investing opportunities, Cabello said. It’s a well-documented, systemic issue in entrepreneurship and venture capital. So a pre-seed round on Wefunder, which anyone can contribute to, felt like the right move to kick off their fundraising journey, Cabello said.
The campaign is actually live now, in a “friends invest first” exclusive launch, though anyone who wants to can participate. Though Wefunder allows campaigns to stay open for a year, the cofounding brothers plan to leave this campaign open for six months.
The campaign operates like this: The founders set a valuation and fundraising goal, and everyone who invests up to $50,000 is put on a hold until founders reach that amount. Once they hit $50,000, the platform sends an email to investors confirming their investment, and the founders begin to get access to the funds.
The $1 million invested in this campaign will be in a Simple Agreement for Future Equity, or SAFE, which gives early investors the right to future shares in the company, with a $10 million valuation cap. However, the first $300,000 of investments will be get a 10% discount on a $7.5 million cap, Cabello told Technical.ly after this article published.
In the months since Technical.ly last checked in, Cabello said Black and Mobile has added a lot more restaurants to the Philly platform, and gotten its tech in line with 95% accuracy in orders and deliveries. Looking forward, Cabello said a future VC seed round would go toward custom app development.