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LuggageHero

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Store your luggage in local shops, cafés and hotels. On-demand, easy to use, secure.

123%
 - 
Funded 25 Apr 2020
€329,004 target
€408,873 from 651 investors
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Business overview

Location Frederiksberg, Denmark
Social media
Website luggagehero.com
Sectors Travel, Leisure & Sport Digital Mixed B2B/B2C
Company number DK37611328
Incorporation date 13 Apr 2016
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Investment summary

Type Equity
Valuation (pre-money) €14.5M
Equity offered 2.73%
Tax relief N/A
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Business highlights

  • More than 2 million bag storage hours
  • More than 250,000 users on the platform
  • More than 50,000 reviews
  • Operating in 40 cities across US and Europe
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Key features

  • Secondary Market
  • Seedrs nominee min. €16.37 +
  • Direct investment min. €50,000.00 +
  • Idea
  • Key Information
  • Team
  • Updates
  • Investors 651
  • Discussion
  • Documents

Idea

Introduction

LuggageHero is a proven luggage storage service that operates as a sharing economy concept. Our extensive network of storage sites are located inside local retail shops, cafés and hotels that have extra space available. We call them “luggage heroes.”

By partnering with local businesses, we are able to offer luggage storage options all over the cities we operate in. Currently, there are more than 1,000 luggage heroes available in 40 major cities in Europe and North America. Collectively they have provided more than 2 million hours of bag storage.

To use the service, customers book the nearest storage location through our mobile-friendly website or native app and instantly receive directions to the location on their smartphone. The drop-off and pick-up processes are quick and easy, and payments are handled securely online. There is no cancelation fee. Luggage is secured with a tamper-proof seal and is insured against damage or loss while in storage for up to €2,500 per bag.

Intended impact

It's a familiar predicament: you have a few hours before you can check in to your vacation rental, and you want to start doing some sightseeing. Or you have to check out by noon but your flight doesn’t leave until the evening. So you’re left exploring a city dragging your luggage behind you. Our mission is to solve that problem.

By utilizing existing space and resources of local businesses, LuggageHero is able to ensure that there is always a storage option close to where users need it. Our cost-effective solution, hourly pricing model and risk-free booking policy provides exactly the kind of flexibility and convenience that modern travelers have come to expect.

Even better, this concept doesn't only benefit travelers. It also gives local business owners an additional way of attracting a strong consumer group to their establishments as well as bringing in extra revenue.

Substantial accomplishments to date

- Luggage stored for more than 2 million hours since launch, growing 186% YOY (Monthly bag storage hours, Dec 2018 to Dec 2019).

- Total GMV (gross merchandise volume) of EUR 1.5M and total net revenue of EUR 0.9M growing 130% YOY (year-over-year) (Both as of Feb 2020 and based on unaudited management accounts).

- Operating in over 40 cities across North America and Europe with more than 1,000 locations, with most of the growth occurring in 2019.

- Acquired US competitor Knock Knock City in August 2019, strengthening ties to North American marketplace.

- More than 250,000 users on the platform, growing 169% YOY (Jan 2019 - Jan 2020).

- Currently #1 luggage storage platform in the world in regards to largest number of reviews ★★★★★ from travelers (+50,000 unique reviews).

- Received substantial international press coverage in several languages, including from: The New York Times, Forbes, Lonely Planet, The Washington Post, Smarter Travel, MSN.com, Oprah.com, The Economist, and more.

Timeline:
Prove = 2016 - 2018:
- Proof of concept in Copenhagen with MVP (minimum viable product).
- Product market fit with launch in London and New York City.
- Luggage stored for +650,000 hours since launch.

Grow = 2019:
- Acquired US competitor Knock Knock City in August 2019.
- Execution on Project36 scaling to 40 cities across more than 1,000 locations in Europe and North America.
- Luggage stored for 1M hours since launch reached in June 2019, then to 2M in January 2020.
- Became a preferred vendor for Booking.com and integrated with major Property Management Systems (PMS), with a total reach to more than 100,000 properties.

Monetisation strategy

The LuggageHero business model is simple: users are charged by the hour (from $1/£1/€1) with a reasonable daily maximum + a handling fee (from $2/£2/€2) per bag. All prices are per bag stored. The revenue generated is subject to a 50-65% commission charged by LuggageHero.

It's free of charge for businesses to join as storage partners.

Future opportunity: Extending our offerings beyond luggage storage.
We are the only storage provider to provide real-time on-demand luggage storage, as far as we are aware, enabling unique data-points of traveler behavior in the cities. Our ambition is to create an additional revenue stream based on the city and traveler behavior data that our algorithm is collecting and analyzing and to package that as a subscription service. We can see this has a great value proposition in terms of future urban planning and also in selecting the most popular places for retail chains, restaurant chains, hotels, apartments/rental and real estate investment purposes.

Use of proceeds

Breakdown of how the funds are planned to be spent:

• Sales and marketing (new markets) — 76%.

• Product development — 14%.

• Management and admin — 8%.

•Financing Costs - 1%.

The business is running with positive contribution margins in 17 out of 40 cities*. It takes on average 3-4 months post-launch to reach the 1st month of a positive contribution margin*. The most profitable cities are Copenhagen, London and New York City, which were launched in 2016-2018*.

* Figures based on unaudited management accounts.

Key Information

Debt

Please note, LuggageHero currently has an outstanding loan of 4m DKK (Circa €536k), which accrues interest at 7.962%. This loan was received in January 2018 and only has interest payable until Jan 2021, payable quarterly. The interest and principal is then repayable from April 2021 onwards for 5 years, payable quarterly. Proceeds from this raise are not intended to be used to repay this loan.

Different currency

LuggageHero has received some direct investments from existing shareholders as part of this round, which were received by the company in DKK. Any investment in the company in DKK is shown in € using the ECB reference rate for 21/04/2020, which is 7.4582 DKK per €.

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If you successfully purchase a share lot of this business, you will be granted access.

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If you successfully purchase a share lot of this business, you will be granted access.

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Investing involves risks, including loss of capital, illiquidity, lack of dividends and dilution, and should be done only as part of a diversified portfolio. Please read the Risk Warnings before investing. Investments should only be made by investors who understand these risks. Tax treatment depends on individual circumstances and is subject to change in future.

This webpage has been approved as a financial promotion by Seedrs Limited ("Seedrs"), which is authorised and regulated by the Financial Conduct Authority. It is not intended to be a promotion of any individual investment opportunity and is not an offer to the public. The summary information provided about investment opportunities on this webpage is intended solely to demonstrate the types of investments available on the Seedrs platform, and any investment decision should be made on the basis of the full campaign. Full campaigns are available to investors who have become authorised to invest on the Seedrs platform. All investment activities take place within the United Kingdom, and any person resident outside the United Kingdom should ensure that they are not subject to any local regulations before investing.

Seedrs does not make investment recommendations to you. No communications from Seedrs, through this website or any other medium, should be construed as an investment recommendation. Further, nothing on this website shall be considered an offer to sell, or a solicitation of an offer to buy, any security to any person in any jurisdiction to whom or in which such offer, solicitation or sale is unlawful. Seedrs does not provide legal, financial or tax advice of any kind. If you have any questions with respect to legal, financial or tax matters relevant to your interactions with Seedrs, you should consult a professional adviser.

Tax Relief (SEIS)

This business is eligible for SEIS relief - providing qualifying investors with income tax relief of 50% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Tax Relief (EIS)

This business is eligible for EIS relief - providing qualifying investors with income tax relief of 30% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Valuation (pre-money)

Valuation rounded from €14,455,267

This is the fully-diluted pre-money valuation of the business (i.e. before the new investment comes in and including issued options and other equity interests). In contrast, the post-money valuation is based on inclusion of the new investment in the value.

It is calculated as the pre-money valuation plus the amount of new investment. e.g. If Company A is ascribed a pre-money valuation of £1,200,000 by prospective investors investing £300,000, its post-money valuation is £1,500,000.

Pitch type

There are 5 types of investment pitch available on Seedrs.

  • Equity
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Equity Offered

The equity offered is the percentage of the company’s shares being issued in return for the amount of investment raised.

When the amount raised is less than 100%, the equity offered is based on the target raise. Once the company has raised over 100% it is based on the total raised.

In some scenarios, entrepreneurs may accept additional direct investment after closing their Seedrs campaign. Provided this is within 6 months of the closing and on the same terms, we do not typically offer pre-emption rights on that extra investment (where you have the opportunity to invest again to maintain your percentage shareholding).

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Seedrs nominee

This shows if you are able to choose, when making an investment, that you be represented by, and your shareholding be managed by, the Seedrs nominee.

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Custodian

If you invest in this Campaign, Seedrs will act as Custodian rather than provide our standard nominee service. This is due to the fact that the business is not directly involved in the share sale and Seedrs will not benefit from any rights under a shareholder agreement. As a result, Seedrs will handle administrative tasks as we do normally, but you will not have information or voting rights, updates from the business, preemption on future fundraising, or ongoing support about business trading activity.

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Secondary market

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Direct investment

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Payment options

We are not able to accept card payments for investments into this sector. You can pay for your investment by creating a bank transfer, using funds in your investment account or create a Pay by Bank payment. Your investment will only be completed once the funds have reached our account.

Business Involvement

This Campaign offers shares for sale in business that is not directly involved in this Campaign or the sale. As a result, the Campaign and post-investment experience, including investor rights, will differ from a business-led campaign on Seedrs. Most notably, the business will not engage with investors in the discussion forums both during and after the sale or provide any updates to investors.

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Payment options

We are not able to accept Pay by Bank payments for investments into this sector. You can pay for your investment with a card payment, by creating a bank transfer or by using funds in your investment account. Your investment will only be completed once the funds have reached our account.

Drawdowns

This campaign offers the ability to pay for an investment by drawdowns.

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