Is Liquid Piston a good investment? LiquidPiston has transformed the combustion engine. It’s due to its patented engine technology. They improved the current combustion engine in almost every manner, so there is no other way to put it. It is more compact, produces more horsepower, and uses less fuel.
Due to declining profits and the 19-year-old company’s failure to provide a product that is ready for the market in two decades, insiders are leaving the organization. After several successful fundraisers, including earning over $17 million on StartEngine, Liquid Piston has reportedly become a favorite among crowd funders. They build their Wankel engine, but it produces three instead of one combustion every spin.
There is a recurring pattern of insiders using Regulation A. This is to pawn the shares to the unwary via social media marketing. It’s even though everyone ages away from an exit. This is something that dozens of founders do when they applaud themselves for turning millions of dollars in investment capital into a few thousand dollars in revenue. Later, they will collect six-figure salaries.
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What is liquid piston technology?
LiquidPiston is a manufacturer of cutting-edge rotary combustion engines with offices in Bloomfield, Connecticut. They are designed for both the automobile industry and unmanned aerial systems. The company’s technology uses various thermodynamic cycles, topologies, and operations. This is to create lighter and smaller engines than conventional diesel engines. Thus, they give clients access to small, effective combustion engines that can run on various fuels.
LiquidPiston created the X-Engine. It is a much smaller and lighter engine than piston engines powered by gasoline and diesel. Also, it offers the possibility of a higher range and lower emissions. For many application areas, LiquidPiston is set to revolutionize power generation. Also, they are open to investment.
The X-Engine has a minimalist, portable, and stylish design. This is based on the advanced rotary platform architecture and unique High-Efficiency Hybrid Cycle (HEHC) thermodynamic cycle. The result is an engine lighter and smaller than conventional ICEs with pistons. They can use fuel more efficiently than a standard diesel engine by 30%.
The X-Engine is spartan and quieter since it only has two main moving elements. They are the rotor and the shaft, which are perfectly balanced. Compared to older piston engines, it also operates with far less vibration. Less weight, space, vibration, noise, and fuel consumption are the outcomes of more than 15 years of study and development.
Is LiquidPiston worth investing in?
The fact that they entered the market at a bad time was the leading cause for concern. Since the company was established in 2003, they have attempted to market this product for almost 20 years. It appears as though their time has ended. It might be hard to convince people to use a new combustion engine in 2023 and beyond.
But more and more people are beginning to see the potential. They do have tested and functional products. This includes ones used in small drones, go-karts, and generators—as well as many connections with the military to manufacturing these items. Their engine has received little attention from outside the government and no actual orders. Research contracts and consulting make up the majority of their income.
For the next 10–20 years, almost every significant automaker has committed to switching to all-electric vehicles. The popularity of hybrid vehicles is low. Also, EV sales are growing while those of combustion engines are falling. There are still some applications available. Particularly in its use with airplanes and portable generators. Things that create more power while using less gas are wonderful for generators. But we don’t yet have the technology to have a fantastic alternative. Also, it will be ten years before an electric jet is ready, and even then, it will be a while before they are widely used.
It’s okay to have a better-performing motor. But it has already taken them 20 years to reach the market. In about 20 years, we won’t have a significant need for engines.
Liquid Piston’s earnings
Liquid Piston has a lengthy history of using crowdfunding to raise money. One of the most worrying things is this. Their primary sources of income are government research grants and consulting contracts. This is troubling since, after 20 years, they continue to lack a product. Thus, it isn’t easy to see how they will expand to the level of a return. Their revenue has only started to increase, but we need more even to think it is worth it.
However, they have a $26 million debt on hand. They were only profitable in 2017 for one year. The road to success is not very clear.
LiquidPiston provides innovative ICE technology. This can be scaled to meet the requirements of many ICE market sectors worldwide. It facilitates new mobility solutions. Investments in LiquidPiston will support the company’s continued expansion and the creation of cutting-edge power solutions. Thus it aims to meet these market demands.
Insiders of Liquid Piston selling stocks
Insiders are leaving the 19-year-old business. It’s because the profits drop, and it has yet to create a product ready for the market in nearly two decades.
One way that businesses put in place a new regulation is through sales to investors. Instead of the money going to the startup, a campaign designated a percentage of the funds to go straight to insiders. Sales by selling stockholders are a good provision. It’s because there may be legitimate applications for them. That is rarely how it is utilized, like anything that can be misused. In actuality, insiders use it to exit their firm since they cannot make it profitable enough to scale to an IPO.
Since its start in 2003, Liquid Piston has been operating. Hence, it has been 20 years, and there still needs to be a production product. With research grants and consulting services, they generated around $10 million in revenue (according to SEC filings from 2016–2021). But they still had a $26 million loss as of 2022. They lost $26 million to generate $10 million in revenue. Even though revenue from government contracts and consulting increased, they are still in the red. They made a small profit and had $3.2 million in 2017, but things have been worsening since then.
They made $2.8 million in revenue and lost $825k in 2018. They made $2 million in revenue and suffered a $1 million loss in 2019. They made $425,000 in revenue and lost $2.9 million in 2020. They had a minor gain in revenue in 2021 and 2022, yet they suffered losses. Their recent audit in 2022 revealed $3.5 million in revenue and a $63,000 loss. It is compared to $2.6 million in revenue and a $1.8 million loss in 2021. This, once more, comes “mostly from government contracts.”
Hence, despite increasing losses, they increased their valuation to $184 million, more than doubling it. Now, insiders are selling their stocks. This is the best concept we have ever heard.
They have lost $26 million in investor money in less than 20 years. Also, they need a scalable and market-ready product. Thus, they are becoming less profitable and are sitting at 70 times revenue. Insiders observed the business’s status and believed they deserved yet another $7.5 million payoff. The CEO receives a cash payment of $220,000, and the CTO receives a cash payment of $222,000, and so on. Everyone refers to the thousands of investors they have attracted through Facebook advertisements.
Conclusion
Despite dealing with some persistent supply chain challenges in 2022, Liquid Piston claims. Also, they made considerable advancements in creating their small rotary X-engine. They want to reach the technical readiness level (TRL) needed to give the U.S. Army the contractual field prototypes powered by heavy fuel of the highest quality. Over the upcoming months, they will make more public product-related announcements. The year 2023 is going to be significant for LiquidPiston.
Liquid Piston promised to focus on their Army and Air Force commitments in 2023. They want to compete for upcoming product opportunities and other DoD product development prospects. They will increase the amount of internally supported R&D and technology demonstration they do. Their 79 awarded and pending patents will be added to their present Their 79 awarded and pending patents will be added to their current portfolio.
They stated that they were enhancing their functional and managerial teams. This will help them expand into a business that operates both technology and products and sophisticated development projects. Also, they will interact with a few industrial companies and military integrators to find new partners. They also want to complete their Reg A+ campaign. This will help them finance the industrialization of their engines and the road to commercialization.