Offering Overview

Player One Energy spent three years trying to figure out the best way to enter the "Bitcoin Mining on oil pads" Industry.  We watched booms and busts in the price of Bitcoin, booms and busts in Oil, and booms and busts in Natural gas.   We decided that the best way to enter this volatile industry was to sell shovels, rather than to pan for gold

In the Bitcoin Mining industry, the cost of electricity is the biggest differentiator.  Player One Energy has come up with different business models for both On-Grid, and Off-Grid, miners where they can obtain the industry's lowest cost of electricity.  We are positioned to be the go-to operator for any small-midsize investor/miner who has containers and miners, and is looking for cheap energy to gain a leg up in profit margin.

The Problem

What problem are you trying to solve and for who?

There are a few problems that bitcoin miners run into when trying to maximize profit margins:

On-Grid:  Miners typically pay 7 cents per KwH.  This rate includes cost for overhead of the facility, and the utilization rate.  Basically, the miners pay an inflated rate to cover the cost for massive hosting facilities, and they pay for any unused space.  In addition, these miners do not have any power in the transaction, as they are just one of many miners on the site.

Off-Grid:  Oil guys don't understand bitcoin and bitcoin guys don't understand the Oil industry.  Too many matchmakers in this industry who just don't understand what it takes to set up a site, and never get the sites off of the ground.  In addition, it is hard to find sites where Bitcoin guys can put multiple megawatts of power on a single site.

Why is this problem important/meaningful to you?

We have many friends in the Bitcoin industry, and have heard all of the challenges that people face to turn their money into bitcoin mining.  Everyone has the money, they want to invest it, but they don't have enough opportunities to get their miners up and running.  In short, there is way too much demand and way too little supply, for the small and mid-size corporate miner market.

The Opportunity

What competition do you have and why are they not addressing the problem effectively now?

Hosting Sites:  Hosting sites will charge in excess of 7 cents per KwH.  They are readily available, but are expensive and subject to grid shutdowns.  Our solution is at 6.5 cents per KwH, or less. which would save the miner around $40,000 per megawatt each year.

Oil Pads:  Most oil operators will not even entertain bitcoin operators purchasing their gas.  It is too foreign, they do not understand it, and there is too much risk in their mind.  Exxon is one of the few who has started, but they signed a deal with a miner who handles everything for them.  After discussing with dozens of oil operators, it will be a tough nut to crack.  We decided to buy our own oil wells, after doing an enormous amount of research, and sell our own gas to the bitcoin miners.  This allows us to make more than $1.25/mcfd, instead of $0.25/mcfd that the matchmakers typically make.  We can command the same mcfd price from the miners, but they are even more interested because we can eliminate the middle man and are in complete control of the well

How big is the revenue opportunity for the addressable market you serve?

Our first Off-Grid (oil well) opportunity, in Kansas, does approximately 800mcfd.  This well is already purchased, we are setting up the bitcoin operation as we speak.  That would net us $360,000/year in revenue.  We have 36 more wells, in Oklahoma and Kansas, that we are currently investigating as high-gas opportunities.  We believe there is in excess of $10,000,000 of potential annual revenue if we acquire these wells.  That is without any oil revenue, and most of these wells will produce oil as well, which would belong to Player One Energy.

Our first On-Grid opportunity, in Oklahoma, is currently being negotiated.  We believe there will be 19.2 megawatts on this site, once we have closed the deal.  This would net us just over $10,000,000 in revenue each year.  These opportunities will be endless, as we just need to find manufacturing sites, or warehouses, that have free space in their yards.  Or, we can purchase empty warehouses, with large properties, and easily place large sites like this on our own properties.

We believe that we will be $15,000,000/year in revenue once we have just a few of each site up and running.

What’s your plan to grab a meaningful share of the market?

We already have a bitcoin miner who has expressed interest in taking all of the gas opportunities that we have outlined for him (and in this pitch).  Once we have exhausted our opportunities with this buyer, our hash rate will be significant, and we will be able to use our contacts to extend to new relationships.  We have brokers who are begging us to bring them opportunities, but bringing these opportunities directly to the bitcoin miner we are working with is much more profitable.

The Solution

What do you or will you do to solve this problem?

On-Grid:  Instead of building massive hosting sites, where people purchase/rent miners, we are developing properties where miners can put their own mining boxes and miners on our property, and pay less for electricity than they could otherwise.  This increases their profit margin, and allows us to take profit without the incredible overhead of having an indoor hosting facility.

Off-Grid:  Instead of trying to be a matchmaker, taking on risk of a jittery operator, and only making $0.25/mcfd, we are buying gas wells and bringing bitcoin miners to our own wells, where we can make $1.25-$2.00/mcfd.

Business Model

How do you make money?

Everything is an arbitrage.  We sell electricity for more than we pay for it.

On-Grid:  We sell hosting space for 6.5 cents/KwH, and we get access to electricity at lower rates than that, without the overhead of having to build buildings, and without the risk of underutilization.

Off-Grid:  We sell gas for $1.25-$2.00/mcfd.  Once we own the well, the gas is nearly free for us.  We simply pay royalty owners a percentage of the profits, and we pay the operator to run the well for us.  But, we own the gas in the ground, and we sell that for a profit to the bitcoin miner.

When will you achieve break-even or have you already?

When we secure the second project, we will be back to breakeven, and we should be cash flow positive of over 6 figures per month.

How do you intend to provide investors with a return on their investment?

We will be giving 10% of our revenue back to our revenue share participants until they triple their money.  For example, if you invest $100,000, you will get a quarterly payment from our revenue until you have received $300,000 in payments ($200,000 profit).

If we can successfully secure the second project for a minimum of three years, our investors would triple their money in less than three years based on that project alone.

Give investors an idea if and how they can expect an exit. E.g. acquisition by larger company, become profitable and distribute returns, etc.

Traction 

Major Business Highlights

First Project:  We bought a site in Kansas for $20,000, which includes an active well, a salt water disposal well, and 80 acres of drilling rights.  We had to put a little over $100,000 into it in order to get the first active well in good shape to produce maximum gas for bitcoin.  The active well should net us approximately $360,000/year in revenue.  The salt water disposal well could be turned into another active well, if we decide to.  We plan to allow our operator to drill a horizontal well on the 80 acres, which could net us in excess of $2,000,000/year in gas sales once that is complete.  To date, we have received over $140,000 in revenue on this site, and that is just to secure the site and help the bitcoin miner get their equipment ready.  The $360,000/year in gas sales should start within the next 30 days.

Second Project (On-Grid):  Currently under negotiations for 19.2 megawatts.  Electric company has agreed to supply the electricity, customer is working on a contract for the prepayment.  This project should be above $10,000,000/year in revenue, once the deal is closed and we have the miners set up (approximately 2-3 months after closing the deal).

Team

Describe how you have the right team to pull this off and why.

Kevin Hobbie, our CEO, has been in the Oil industry for over a decade.  He has worked for some of the biggest names in the industry, and has also owned and operated/exited two Oilfield Safety Consulting companies.  He was heavily involved in the first Crusoe projects, who were the first major player in putting bitcoin miners on oil wells.  Kevin currently is President of Player One Energy and Texoma Safety Consulting.

Todd Hagopian is currently the President of Cash Flow Acquisitions, which is a holding company that owns manufacturing, retail and service companies.  He has previously run companies for Berkshire Hathaway and Illinois Tool Works.  His specialty is building business models that smash orthodoxies in old, stagnant industries.  He has done this in appliances, shopping carts, and other various products throughout his career.

Funding

Use Of Funds

When the $60,000.00 Minimum is Raised:

• We will be using the funds to secure the second project, so that we can move to the point where we have significant revenue and strong cash flow.

When the $120,000.00 Maximum is Raised:

• We will start our second project, pay off our current obligations, Todd and Kevin will begin to work full-time on Player One Energy to that we can begin working on multiple projects at once (instead of one at a time), and we will move to our third project, which is securing a package of five extremely attractive identified wells in Kansas.