- After the successful launch of Plant Power Ocean Beach in 2016, the Plant Power team is now offering an investment opportunity in its new location in Encinitas
- The Plant Power Encinitas location will feature drive-through service, offering healthy, vegan alternatives to hamburgers, hot dogs, and other fast food staples
- Fast food industry is expected to grow to $645 billion by 2020, a compound annual growth rate of around 4.5% from 2015i
- About 70% of meat-eating Americans substitute one vegan/vegetarian meal for a meat-based protein once a weekii
*You are investing in equity in this offering. Perks are meant to be a thank you from the company for investing. The perks below are NOT inclusive of lower dollar amount perks. **Shirts will not be shipped and are for local pick up only.
$250: $15 electronic gift certificate
$500: $25 electronic gift certificate
$1,000: $50 electronic gift certificate
$1,500: $75 electronic gift certificate
$2,000: $150 electronic gift certificate, investor mentioned in thank you on website
$2,500: $175 electronic gift certificate, investor mentioned in thank you on website, 2 Plant Power t-shirts**
$3,000: $225 electronic gift certificate, investor mentioned in thank you on website, 2 Plant Power t-shirts**, ownership card with 10% discount for life
$4,000: $325 electronic gift certificate, investor mentioned in thank you on website, 2 Plant Power t-shirts**, ownership card with 10% discount for life
$5,000: $400 electronic gift certificate, investor mentioned in thank you on website, 2 Plant Power t-shirts**, ownership card with 10% discount for life
$7,000: $550 electronic gift certificate, investor mentioned in thank you on website, 2 Plant Power t-shirts**, ownership card with 10% discount for life, investor mentioned in thank you on website
$10,000: $900 electronic gift certificate, investor mentioned in thank you on website, 2 Plant Power t-shirts**, ownership card with 20% discount for life, investor mentioned in thank you on website, investor’s name on wall of Plant Power Encinitas
$15,000: $1,350 electronic gift certificate, investor mentioned in thank you on website, 2 Plant Power t-shirts**, ownership card with 20% discount for life, investor’s name on wall of Plant Power Encinitas
$20,000: $1,800 electronic gift certificate, investor mentioned in thank you on website, 2 Plant Power t-shirts**, ownership card with 20% discount for life, investor’s name on wall of Plant Power Encinitas
Plant Power Fast Food aims to develop a national chain of fast food restaurants that offers healthy, vegan alternatives to hamburgers, hot dogs, and other fast food staples.
Plant Power Fast Food, a California Partnership, was formed by Mitch Wallis, Zach Vouga, and Jeff Harris. The co-founders seek to develop a national chain of fast food restaurants that offers healthy vegan alternatives to traditional fast food fare. Plant Power Fast Food is seeking investors to participate in the second Plant Power Fast Food location slated to open in Encinitas, California in May 2017. The first location opened in Ocean Beach, California in January 2016. Both locations are in the greater San Diego area. These two units will be the beginning of what the team envisions to be a national restaurant chain catering to the rapidly emerging market for healthier, organic alternatives in the fast food market segment. Investors are investing in Plant Power Encinitas, LLC which will have the option to convert into shares of a yet-to-be-formed company, that will become the parent company of Plant Power Encinitas, LLC and Plant Power Ocean Beach, LLC, upon an equity financing for the yet-to-be-formed entity of at least $1,000,000.
With increasing interest in natural, healthier foods comes new opportunities for restaurant groups, particularly those in the quickly developing fast casual market.i From parents looking to quickly feed their kids to business professionals looking for convenient on-the-go dining choices, many types of consumers are seeking healthier alternatives to traditional fast food options. Simply being fast and affordable is not enough; consumers are now demanding options that cater to all kinds of diets, including vegan and gluten-free. According to a 2016 national health food study by Earth Balance, more shoppers are seeking dairy-free and plant-based foods:ii 69% of consumers have reported that they’re eating more meatless meals and 63% reported having tried plant-based meat and dairy alternatives.iii
The following are metrics related to Plant Power Ocean Beach and are for illustration purposes only. These are NOT metrics related to the new Plant Power Encinitas location.
In February 2017, the Plant Power Ocean Beach location averaged over 1,985 guests per week and sales of over $28,000 per week. In its first full month of operation in February 2016, the location averaged 1,565 guests per week and sales of over $20,000 per week.
The Plant Power Ocean Beach location generated over $1.2 million in revenue over its first 12 months of operation with revenue growth averaging +5% per month. The Plant Power Ocean Beach location experienced a gross profit margin of 72% in its first 12 months of operation.
Plant Power Encinitas is not open to the public yet and is currently not generating income.
Plant Power Encinitas has received over $900,000 in capital contributions. The company has received $195,000 in August 2016, $100,000 in September 2016, $200,000 in November 2016, and $225,000 in January 2017, among other contributions. Plant Power Encinitas had an ending cash balance of $275,483 as of February 2017.
Industry and Market Analysis
According to a 2016 Harris Interactive poll, over 3% of the U.S. population, approximately 8 million people, are vegetarians or vegans.iv About half of vegetarians, approximately 3.7 million people, follow a vegan lifestyle.v Moreover, about 70% of meat-eating Americans substitute one vegan/vegetarian meal for a meat-based protein once a week,vi and 37% of Americans enjoy vegan/vegetarian meals when dining out though they may not follow a vegan/vegetarian lifestyle.vii
With consumers now seeking healthier food options and considering the processes and preparation their food undergoes, the market for organic food is predicted to reach $1 trillion in 2017.viii In 2015, the sales of products that incorporate plant protein have increased over 8.7% through retailers (not including Whole Foods).ix Meat substitute sales have been on the rise since 2010, growing to $4 billion in 2016x, and are projected to reach $5.96 billion dollars by 2022.xi The total plant-based food industry saw approximately $4.9 billion in revenue over the 12 months ending June 2016, up 3.4% over the prior 12-month period.xii
However, convenience is still highly regarded when consumers decide on their next meal. The fast food industry is expected to grow to $645 billion by 2020, at a compound annual growth rate of around 4.5% from 2015 to 2020.xiii Within the industry, a new segment was born out of the demand of higher-quality, healthier ingredients. Deemed “fast casual,” this subindustry consists of eateries such as Chipotle and Panera Bread®. Fast-casual restaurants price food at a higher price point, but food preparation is on site and food is typically of a higher quality than a traditional fast food restaurant. A hybrid of the fast food industry and the full-service restaurant industry, fast-casual restaurants have also adopted a unique objective of promoting sustainability and community.
According to global market research firm Euromonitor International, fast-casual dining is the strongest growing segment of the global consumer foodservice industry, having grown by 550% since 1999.xiv Yet while fast-casual restaurants have been around for decades, the growth in popularity is relatively recent. Fast-casual dining increased 10.4% in 2015, reaching $3.4 billion in sales.xv
The second Plant Power Fast Food location will be opened in Encinitas, California. Encinitas is a coastal beach city approximately 25 miles north of San Diego and about 95 miles south of Los Angeles.xviii As of 2015, the city had an estimated 62,930 people, up 5.7% from 59,518 in 2010. In 2015, the Encinitas had a median household income of $95,149, which is 54% higher than the California median household income of $61,818.xix
Plant Power Ocean Beach: Plant Power Ocean Beach is currently operating as a separate entity from Plant Power Encinitas. If in the future both locations are operating under a parent company, which has not yet been formed, Ocean Beach would no longer be considered a competitor. Opened in January 2016, Ocean Beach was the first Plant Power location. Ocean Beach is located in San Diego and is within four blocks of the beach. Catered to the emerging market for healthier, more natural alternatives in the fast food market segment, Ocean Beach's menu was created entirely without the use of animal products, artificial colorings, flavorings or preservatives, and is 99% GMO-free. The restaurant features "Sonic"-style drive-up ordering kiosks, indoor ordering, and both indoor and outside dining. Ocean Beach generated over $1.2 million in revenue over its first 12 months of operation with revenue growth averaging +5% per month.
LYFE Kitchen: Founded in August of 2011 by former McDonald’s executivesxx, LYFE Kitchen is a sit-down fast food chain that currently operates 14 stores in six states.xxi The menu consists of options for vegetarians, vegans, and meat eaters, including grass-fed beef and chicken. The chain excludes items such as butter, trans-fats, white sugar, high-fructose corn syrup, and other additives from its food and uses locally sourced ingredients when available.xxii Customers order at a counter and have the option of eating at the restaurant or taking their food to go.xxiii LYFE Kitchen plans to open a full-service restaurant at one of its Memphis locations in late spring 2017.xxiv
Loving Hut: Founded in 2008 by Supreme Master Ching Hai, a Buddhist meditation teacher, Loving Hut is an international Asian-themed vegan chain. The chain has more than 200 locationsxxv in 25 countries, with 43 locations in the U.S., including two in San Diego.xxvi Loving Hut operates a franchise modelxxvii that allows owners to create their own unique dishes, operate different business models – such as fast food, casual counter service, or full-service dining – and set their own hours.xxviii
Veggie Grill: Started in 2007, Veggie Grill is a fast-casual vegan restaurant chain that operates 28 restaurants in California, Oregon, and Washington.xxix Veggie Grill’s menu items are free of meat, dairy, eggs, and other animal products and, therefore, contain no antibiotics or hormones.xxx In October 2016, Veggie Grill raised $22 million to expand outside of the West Coast and to double its size over the next three years.xxxi
Native Foods Café: Native Foods Café is a fast-casual vegan restaurant that serves seasonal made-from-scratch items.xxxii Native Foods Café opened its first location in 1994 in Palm Springs, California. Since 1994, Native Foods Café has expanded to 14 locations spanning California, Oregon, Colorado, and Illinois.xxxiiii In April 2014, Native Foods Café raised $15 million from private equity firms Laurel Crown Partners LLC and Huntington Capital to fuel its national expansion efforts. This followed a $10 million round of funding raised in 2012 from Santa Barbara-based NGEN Partners.xxxiv
True Food Kitchen: Founded in 2008, True Food Kitchen is a health-driven, seasonal restaurant chain that caters to nearly every food preference with a variety of gluten-free, all-natural, organic, vegetarian, and vegan offerings.xxxv The company was co-founded by Dr. Andrew Weil and Phoenix restaurateur Sam Fox after Fox spent time cooking with Dr. Weil at Dr. Weil’s ranch. Each location features dishes that closely adhere to Dr. Weil’s anti-inflammatory diet principlesxxxvi that promote fresh food and minimize the consumption of processed foods. The restaurant chain currently has 16 locations and plans to open six more locations in 2017.xxxvii
Mitch Wallis, CEO and Co-founder: Mitch is currently an Attorney at Law who has been in practice since 1990 and has had an active practice in San Diego since 2004. In addition to his law practice, Mitch has been involved in creating a number of successful natural food businesses over the past 26 years. Along with his brother Loren, Mitch began with the launch of Health Shack USA in 1988. Health Shack was a multi-unit natural foods café running out of health and fitness center locations throughout Tucson, Arizona. The business was eventually sold to investors. From 1985 to 1990, Mitch and his brother owned and operated “Smoothie Bodies,” a line of fresh smoothies and juices sold to health food and grocery stores throughout Phoenix and Tucson. After selling “Smoothie Bodies,” Mitch teamed up with investors to launch Natures Express in Palm Springs in 1992. Natures Express, a fast food vegan restaurant specializing in burgers, wraps, tacos, and salads, was sold in 1995. From there, Mitch teamed up with various investors to open Eatopia in Ocean Beach, California (sold to investors in 2004 and now operating under a different name). Mitch was also responsible for opening well-known natural foods restaurants Good Karma in Venice, California (2005) and Kung Food, a popular vegan sit-down restaurant, in San Diego in 2004. In 2005, Mitch founded EVO, a wholesale vegan/natural foods company specializing in prepackaged deli-type food items that are currently sold in Whole Food Markets and other natural grocery stores throughout California. After Kung Food lost its lease, Mitch teamed up with Richard Robinson to open a Natures Express in 2007 in the building next door to the former Kung Food location. In 2010 Natures Express rebranded as Evolution Fast Food.
Security Type: Simple Agreement for Future Equity (SAFE) Securities
Round Size: Min: $50,000 Max: $400,000
Interest Rate: 6%
Length of Term: N/A
Conversion Provisions: In connection with an equity financing of at least $1,000,000 of the yet-to-be-formed parent company, the Company has the option to convert the SAFE into shares of a series of non-voting preferred securities of the yet-to-be-formed parent company, at a discount of 20% of the price per security of the new preferred securities sold in the equity financing or a valuation cap of $5,500,000, whichever results in a lower conversion price. Please refer to the Form of SAFE for a complete description of the terms of the SAFE, including the conversion provisions.
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