Have Questions? We have got answers!
Why should I consider investing?
This is a unique opportunity to contribute to the future of online security and become part of the success story of ZenMate, which has already been backed by the world’s leading venture capitalists such as Bessemer Venture Partners, Holtzbrinck Ventures, Deutsche Telekom’s T-Venture, and Project A Ventures. Lets shape the future of the online world together.
I pre-registered. What do I do now?
Our crowdfunding campaign on Crowdcube is live and will be for the next upcoming 30 days. Head over to Crowdcube, make an account and invest! We will follow the standard and official Crowdcube process and more information can be found under https://www.crowdcube.com/how-to-invest. If you have any further questions, please contact us and we will get back to you with an answer as fast as we can.
Are there limits on the amount i can invest?
We want to give everyone the opportunity invest into our future. We have set the minimum investment amount at £10 and the sky is the limit. For each tier, the investors will recieve various perks and rewards for contributing to our future.
Who can invest?
Several of the world's best know Venture Capitalists have invested in ZenMate. Now, we want to give a chance to anyone else who is interested in shaping the future of internet and its security - from other venture capital firms, to everyday investors, as well as professionals.
How do I actually invest?
We are using the official Crowdcube crowdfunding platform for our campaign. The FAQ of Crowdcube outlines the process and gives some further information: https://www.crowdcube.com/how-to-invest. To get started make an account with Crowcube and visit www.crowdcube.com/zenmate.
Why are you doing Crowdcube and not an ICO?
We have chosen to partner with Crowdcube as they are the market leader in crowdfunding for equity. We believe that they offer great opportunity for our customers to all participate in this process. They also make the whole process very easy.
We have selected not to do an ICO because of the recent flood of ICOs. This has resulted in a glut of ICOs and even some less than robust companies offering ICOs. We prefer to offer our customers and fans a real piece of the company and a trusted crowdfunding platform such as Crowdcube, which has helped hundreds of business attracts investors.
What is the long-term / exit strategy being considered?
Making the internet a safer place is part of our mission and plays an important part in “why we do the things we do”. Clearly though, we are a profit oriented company and so is our management team. This means that we are set up for growth. Therefore, we offer our investors, current and future ones, a share in the future profit - ZenMate is not a construct based on ideological values alone.
As for an exit strategy, it is closely linked to revenue and user base growth. These two KPIs are tightly tied together, because we are operating in a commodity market, that already combines Premium and Freemium business models. We are considering different scenarios between now and EOY 2019, including full M&A at current or new evaluation (subject to change based on financial results of 2018 and further user base growth, also including free user base). This means we offer to our current and future investors a chance to participate in this process in the future.
What is the distribution between new and recurring revenue?
As of our 2017 revenue numbers announced in our pitch deck, the average split of our revenues for 2017 and the first six months of 2018 is roughly balanced between 35:65 although there may be seasonal and monthly variances in that ratio.
Will I recieve any perks for becoming an investor in ZenMate?
We did not forget about perks! Depending on how much you invest, there are several tiers of perks prepared, ranging from ZenMate swag-bags or Ultimate subscriptions to trips to Berlin. For the full list of perks, please scroll down.
What is the purpose of this campaign? What are you going to do with the raised capital?
The overall purpose is twofold. Firstly, we want to offer our customers and users the opportunity to take a real stake in the company and its future. Secondly, we wish to accelerate our development program. By extending the product portfolio, entering new markets and increasing tha range of distribution channels, we plan to transition into a fully comprehensive security company, which offers “privacy and security as a service”. We believe that now a crucial moment has come for the security and privacy of the online world and by accelerating and ensuring our long-term growth we will have a major impact in shaping the future as well as helping people from around the world gain access to a free and unrestricted internet. Anytime, Anywhere.
Did anyone else invest at the proposed valuation?
Yes. As a matter of fact, the current valuation was set in the context of an institutional round and €4M have been collected so far. The following investors invested at the current valuation: Bessemer Ventures, Holtzbrinck Ventures, Project A, T-Ventures, Shortcut Ventures and Axel Springer Plug&Play.
Why are you crowdfunding if you already have investors?
We already explained this is the pitch as well as in supporting press release: https://zenmate.com/blog/zenmate-crowdfunding. Let’s us summarise: ZenMate would not have had the success it had over the years without its loyal and engaged users. As founders and management we felt that it was only right to give a chance to our users to share our success. As such, we asked our investors to agree to open up the round to Crowdfunders at the same valuation at which they invested. We are hoping that this will further strengthen our community.
How much of the company is owned by the management and founders?
Over 40% of the company is owned by the Management and Founders keeping us fully focused on growing the company and making it a global success. All of the money raised (and being raised in the crowdfunding) is going 100% towards the development of the company and not towards secondaries. Furthermore, the founders are going to forfeit any salary going forward as a further signal of their commitment towards ZenMate.
How was the valuation decided upon?
There are two components that feed into our valuation:
1. Our subscription based business model has proven very stable and has been growing consistently since we first introduced the Premium tier. Moreover, the organic growth of our customer base meant that growth could be achieved without expensive marketing campaigns. This, combined with the fact that we provide a software product with a high profit margin, will continue to be a driver of our valuation expansion.
2. We invested a lot on brand and reach and built a huge global community of like-minded people. With over 40M users, our community has an enormous value in the context of expanding our product portfolio. While other companies will have to win customers from scratch, we can offer new products to an already massive customer base, hence ensuring that our new products will gain traction from day one.
*Note: our valuation was set in EUR terms. The GBP number was calculated using the FX rate at the time of the launch of the campaign.
Can you explain what type of ZenMate shares are being offered?
The Company is offering Preference Shares (“Preference Shares”) to Crowdcube Investors. Crowdcube investors will hold Preference Shares through a Nominee, which will be the registered holder of legal title to the shares, with beneficial interest owned by each investor. These shares carry a 1x non-participating Liquidation Preference pari-passu with those of the institutional investors.
Is ZenMate planning to develop a service "hub" that can offer many tools (e.g. messenger, storage or password manager) combined into one service?
Yes, we do work now on a concept which we internally refer to as “Privacy-as-a-Service”, or “Integrated Privacy Management”. The idea behind is to have several aspects of your privacy be accessible and managed from one place, where user can decide for himself - do I need this or that, should I switch it on or off, pay for just one-off, subscribe, add to existing plan etc. WE are looking into hybrid approach, where some of the bits and pieces will be developed in-house, while other either outsourced and integrated via API or through alliance with set of security vendors, who can compliment each other. At the moment we have five different partners we talk to - each covering different piece of widely meant privacy online.
ZenMate plans to extend the market in China. How do you plan to kickstart the market if in China VPN services are not accepted?
Censorship is a major problem across the world. We currently track about 12 countries with varying degrees of censorship. In each of these countries, the methods of restricting content and preventing VPN based access varies. At ZenMate, we have an on-going process where we respond to specific instances of changes in the censorship methods within these countries. In addition, we are currently designing a solution that we believe be effective. The difficulty is that Censorship is a moving target, so what we believe is a solution today may not be tomorrow. This is also part of the reason we are seeking additional funding as this process is intensive and time consuming.
Why should I invest in ZenMate? What makes it different from the competition?
We believe that sticking just with VPN as a solution for privacy isn’t right. Therefore, when we compare ourselves with A-B-C-D VPN provider (our competitor), we may not necessarily stand up from the crowd. Same counts for our competitors. More holistic view at modern privacy issues is needed. And that’s why we are developing concept we describe in our our first answer. This will make us different.
User loyalty and trust is one of the most important aspects in the VPN market. Did ZenMate ever have any legal issues? Did you ever recieve and DMCA or Court requests? How did you deal with it?
Yes we did receive some in the past, but our response was always the same. We do not have user data in question, so we cannot provide those. We are committed to keep user data and user privacy strictly confidential. We can’t do other way anyway due to the German law.
How to invest if you are a resident of the United States, Canada or Japan?
If you are either from the United States, Canada or Japan and are interested in investing, please contact us at email@example.com.
What to do if I can’t access your pitch page from the United States?
If you are not able to access our pitch from your current location, we suggest to install ZenMate VPN and change your virtusa location to the UK or any EU state.