FORM 1-K
ANNUAL REPORT
For the Fiscal Year ended December 31, 2024
For
EvolveX Equity Fund, LLC
A Colorado Limited Liability Company
Commission File Number: 024-11892
Contact Information:
EvolveX Equity Fund, LLC
7491 Kline Drive
Arvada, CO 80005
Phone: 720-739-3009
1. BUSINESS
Business Done, Intended to Be Done, and General Development of Business (since inception)
EvolveX Equity Fund, LLC (the “Company”), is a real estate fund and operating company focused on the purchase, lease, management, and sale of real estate assets categorized as residential furnished vacation rental properties, and 10-unit and smaller multifamily furnished rental properties. The units within the multifamily properties will be a mix of short-term vacation rental and 1-year rental properties. The managing member of the Company is EvolveX Capital, LLC (the “Manager”), which will be responsible for acquiring, managing, leasing, and disposing of the Company’s investment properties and for providing certain administrative services, directly or indirectly through one or more affiliated or unaffiliated parties.
During the year ended December 31, 2024, the Company sold 10 Class A Units for net proceeds of $80,000 and ($86,206) net of issuance costs, including $166,206 of issuance expenses. During the year ended December 31, 2023, the Company sold 733 Class A Units for net proceeds of $733,000 and $332,824 net of issuance costs, including $400,176 of issuance expenses.
Principal Products/Services
The Company’s primary focus is to generate attractive returns by investing in single family and multifamily properties that have a high probability of appreciating over a projected 10-year holding period. Additionally, the Manager will select “income-producing” properties – those that in the short-term have a positive monthly income after all expenses (mortgages, operating expenses, taxes) and maintenance reserves are paid. Each of the properties will then managed by an Affiliate company, EvolveX Dwell, LLC, during the holding period to maximize the appreciation for Investors.
EvolveX Dwell, will also work with the Manager to acquire properties for the Company. EvolveX Dwell and the Manager will shop properties year-round to discover opportunities in which to invest. EvolveX Dwell will focus on buying properties that offer opportunities to increase rents, occupancy, reduce concessions, while using Mr. Schley’s proprietary knowledge and strategies for improving customer service through smart management, positive customer experience and economies of scale.
In addition to the above criteria, the Company focuses on investments that should provide positive cash flow upon acquisition or the potential for cash flow in the future. The Company follows a very conservative investing model where the purchase price is based on trailing 12-month income calculations and worst-case scenario situations. The Manager has bought and sold real estate assets through various economic cycles and in different markets. The Manager’s goal is to continue to build wealth though real estate with well positioned acquisitions, highest quality property management and strategic dispositions.
Investment Strategy
The Company will use a proprietary 7-step grading system to identify a specific geographic market for investment, by utilizing investment fundamentals in order to reduce risk, and maximize potential returns. These steps include evaluating the following: (i) Market Amenities; (ii) Affordability; (iii) Demand; (iv) Zoning Regulations; (v) Revenue Growth; (vi) Seasonality; and Property Value Growth. After each of these categories is graded in a market, an overall grade will be assessed. The Company will seek to invest in geographic markets with an overall grade of A- to A+. Once a geographic market has been identified, the Company will identify specific properties using an income analysis which will include projected pro forma to estimate the income, occupancy, expenses and net operating income (“NOI”) of properties. The Company will use the NOI to estimate the capitalization rate for target properties.
Geographic Regions
The Company will initially focus mostly on opportunities in the Western and Southwestern portions of the United States and high potential international opportunities will also be taken into consideration. The Company may invest in other potential opportunities outside of these regions as they present themselves. The Company will initially consider investment properties in the following geographic areas: (i) Colorado (including the Central Rocky Mountain Region and the Front Range); (ii) Arizona; (iii) California (including Northern coastal, Southern, and Lake Tahoe); (iv) Hawaii; (v) Washington; (vi) Coastal Maine; and (vii) Costa Rica.
Principal Market for Products/Services
Potential Renters. The demographic profile of individuals who rent a dwelling versus a hotel are different. The Company’s target markets of potential renters will include: (i) families with small children; (ii) couples; (iii) larger groups; (iv) active vacationers; and (v) foodies and festivals.
Method of Distribution of Products/Services
To acquire tenants for the rental properties the Company will use: (i) Vacation Property Rental Sites; (ii) Independent Websites; and (iii) Social Media.
Vacation Property Rental Sites. The Manager will utilize the following top vacation property rental services, which will be managed by a single host:
Airbnb. Listing a property on Airbnb is free, however, the host is charged a 3% service fee on bookings. The guest pays a booking fee of 15%.
VRBO. VRBO offers a subscription model, and the host is charged $499 annually. The guest pays a booking fee of up to 12%.
Booking.com. Listing a property on Booking.com is free, however, they the host a 15% commission on bookings. Rental rates are typically adjusted upwards to account for this cost. The guest does not pay any additional fees.
TripAdvisor. Listing a property on TripAdvisor is free, however, the host is charged a 3% commission per booking. The guest pays a booking fee that ranges from 8% to 16%.
Expedia. Listing on Expedia is free, however, the host is charged a commission between 10% and 30%. Rental rates are typically adjusted upwards to account for this cost. The guest does not pay any additional fees.
There are also a significant number of smaller sources that will be utilized to market the rental properties.
Independent Websites Each investment property will have its own website, which will be SEO optimized for search engine performance. Pushing potential renters to the website will reduce booking fees and maximize profitability. We estimate that each website can be developed at a cost of $3,000 per site.
Social Media Social media pages will also be developed for each property and will be organically promoted throughout the various social media channels.
Villas Espavel
The Company acquired Villas Espavel on August 24, 2023. Villas Espavel is a cluster of six well-appointed and modern villas for families, explorers, and considerate travelers in Samara, Costa Rica.
The rental property consists of six different size villas that can accommodate from 2 to 9 guests per villa, with each villa having its own kitchen, air conditioning, a patio to relax under the jungle shade, and orthopedic mattresses for a good night’s sleep. Villas Espavel is an easy 5-10 minute walk or few minute bike ride to Playa Samara and the town center.
Independent websites (www.villasespavel.com and www.samaracostaricaretreats.com) have been developed and the property also has an individual Instagram social media account (@villasespavel). Most of our rentals are currently direct bookings, but we also use VRBO and AirBNB. We have contracted an onsite manager at the property. The individual manager handles most of the operations directly on location and was the person who managed the property under the previous management.
Employees
As of the date of this Offering Circular, the Company has two (2) employees. Both of these employees are full time .
Legal Proceedings
The Company is not presently a party to any material litigation, nor is any litigation known to be threatened against the Company. Furthermore, the Company has no bankruptcies, investigations, or criminal proceedings to disclose.
Distinctive/Special Characteristics of Company’s Operation or Industry Reasonably Likely to Have a Material Impact upon Company’s Future Financial Performance
Guest, Visitor and Renter Statistics
| · | Domestic travel declined 36% in 2020. |
| · | Average nightly rates in popular vacation destinations range from $186 per night for a single rental to $978 per night for a family-sized rental. |
| · | 53% of all travel is booked online. |
| · | 67% of travelers think it’s cheaper and easier to book on a brand website rather than a third-party website. |
| · | 71% of travelers with children say access to cooking their own meals is a major reason they choose a vacation rental. |
| · | 83% of travelers prefer to spend their vacations near water. |
| · | 74% of travelers prefer to be on the coast. |
| · | 51% prefer mountainous vacations. |
Generational Differences
| · | Millennials make up 40% of leisure travelers who book online. |
| · | Generation Z or Gen Z is most likely to travel with friends (35%) instead of traveling alone or with immediate family. |
| · | Prior to 2020, Gen Z spent their average vacation time in cities (more than 60% of the time), far surpassing rural and suburban destinations. |
| · | 81% of Gen Z travelers have already stayed in a vacation home, cabin or condo at some point in their lives. |
Travel Planning
| · | Travelers save up to 70% by booking stays in the off-season. |
| · | 95% of visitors have their travel plans influenced by brochure information. |
| · | 83% plan to visit a business or attraction highlighted in a brochure, map, or guide. |
| · | 78% of travelers consider altering their travel plans as a result of a brochure. |
| · | 53% of travelers use brochures to plan their trip before they arrive. |
| · | 59% of people review websites, online forums, etc. before going on a trip. |
| · | 31% turn to family and friends for recommendations when planning a vacation. |
| · | 25% of people use a travel agency website. |
Current Trends
| · | In April 2020, the industry had a 48.9% unemployment rate. |
| · | Industry specialists project a return to a roughly 7.0% annual industry growth rate. |
| · | 61% of families are more likely to visit a rural or “outdoorsy” destination than an urban one. |
| · | 59% of families are more likely to drive instead of fly on their next trip. |
| · | Private room accommodation has decreased in popularity by 99%. |
| · | Cabins have increased in popularity by 80%. |
| · | Villas and bungalows increased in popularity 61% and 60%, respectively. |
| · | Statisticians expect revenue from the U.S. vacation rental industry to total roughly $15.338 billion in 2021. |
| · | The user penetration rate (percentage of a target market that consumes a product or service) is 15.3% in 2021. |
| · | The ARPU is projected to total $300. |
*Sources
1. Internal Revenue Service (IRS), Topic No. 415 Renting Residential and Vacation Property (https://www.bls.gov/iag/tgs/iag721.htm)
2. Vacation Rental Market Association, Industry Research Data
(https://www.irs.gov/pub/irs-pdf/p527.pdf)
3. VRM Intel, How 2020 Played Out: Analyzing Performance in 10 Key Vacation Rental Destinations
(https://vrmintel.com/how-it-played-out-2020s-conclusion-analyzing-performance-in-8-key-vacation-rental-destinations)
4. Grandview Research, Industry Analysis: Vacation Rental Market (https://www.grandviewresearch.com/industry-analysis/vacation-rental-market)
5. Statista, Vacation Rentals Worldwide
(https://www.statista.com/outlook/268/100/vacation-rentals/worldwide)
6. Statista, Vacation Rentals in the United States
(https://www.statista.com/outlook/268/109/vacation-rentals/united-states)
| 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR FY 2023 AND FY 2024 |
Information and materials contained herein may contain forward-looking statements that are based on the expectations, estimates, projections and assumptions made by or on behalf of the Company and the Manager. Words such as “expects,” “anticipates,” “plans,” “believes,” “scheduled,” “estimates,” “continues,” “remains,” “maintains,” and variations of these words and similar expressions are intended to identify forward-looking statements. Forward-looking statements may include, but are not limited to, projections of cash flows, loan repayment or deferment rates, interest rates, increases in financing costs, limits on liquidity, and bond redemptions. These statements are not guarantees of future performance or events and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results, trends, and events may differ materially from what is forecast or assumed in forward-looking statements due to a variety of factors, including but not limited to:
| · | the Company’s ability to attract and retain Investors via its Investor Portal website; |
| · | risks associated with breaches of the Company’s data security; |
| · | changes in economic conditions generally and the real estate and securities markets specifically; |
| · | limited ability to dispose of assets because of the relative illiquidity of real estate investments; |
| · | intense competition in the real estate market that may limit the Company’s potential to acquire or rent its assets; |
| · | increased interest rates and operating costs; |
| · | decreased rental rates or increased vacancy rates; |
| · | failure of the Company’s acquisitions to obtain anticipated results; |
| · | the ability to retain the key personnel of the Manager; |
| · | the Manager’s ability to retain and hire competent employees and appropriately staff the Company’s operations; |
| · | the general interest rate environment, which may increase the costs or limit the availability of financings necessary to initiate, purchase, or carry project related loans; |
| · | compliance with applicable local, state, and federal laws; and |
| · | changes to generally accepted accounting principles, or GAAP. |
All forward-looking statements speak only as of the date of their publication or, in the case of any document incorporated by reference, the date of that document. All subsequent written and oral forward-looking statements attributable to the Issuer, the Manager or any person acting on its behalf are qualified by the cautionary statements in this section. Neither the Company nor the Manager undertakes any obligation to update or publicly release any revisions to forward-looking statements to reflect events, circumstances or changes in expectations after the date of this annual report.
Plan of Operations
There are a number of key factors that will potentially impact the Company’s operating results going forward, including the Company’s ability to obtain high quality properties at reasonable prices, supervise the renovation of those properties to the extent necessary, and subsequently market and rent the properties at premium rental income rates. Another factor is the Manager’s ability to effectively market and operate the investor portal website to promote the current Offering to Investors.
On August 24, 2023, the Company acquired a residential rental property located in Playa Samara, Costa Rica for total capitalized costs of $1,000,432. The rental property consists of six different size villas that can accommodate from 2 to 9 guests per villa, with each villa having its own kitchen, air conditioning and patio. The Company plans to optimize this investment and owns this property outright with no outside funding in place.
The following is a statement by the management regarding the period of January 1, 2024 through December 31, 2024, as compared to the same period in 2023.
Overview
EvolveX Equity Fund, LLC (d/b/a Blue Fusion Equity Fund) (“the Company”) was organized in June 2021 in the State of Colorado. The primary business is the high-quality management of real estate investment funds. The Company’s strategy is to create funds that will primarily focus on short-term vacation rental properties in emerging markets throughout the United States and internationally.
Operating Results
Revenue/Net Loss from Operating Activities. For the 12-month period ending December 31, 2023 and December 31, 2024, respectively, the revenue for the Company increased, from $63,150 to $100,839, representing a difference of $37,689.
For the same periods, the Company's net loss increased from ($118,809.00) to ($157,822.00), a difference of ($39,013.00). These demonstrate relative changes in the Company’s operating expenses. These results are due primarily to the Company’s addition of contract labor expenses, increase in depreciation and software and apps, and decrease in repairs and maintenance, professional services, and travel and meals, as the Company reduced its property acquisition focus but ramped up the property development and operations of its owned and active vacation rental property.
Financing Activities. For the 12-month period ending December 31, 2024, the Company received investments totaling ($86,026.00), down from $332,824.00 for the period ending December 31, 2023, representing a decrease of $418,850.00.
Salaries and benefits. Salaries and benefits for the 12-month periods ending December 31, 2024 and December 31, 2023, respectively, remained unchanged at $0.00, as there are no paid employees currently.
Liquidity and Capital Resources
As of December 31, 2024, the Company had cash of $22,743.00, and total assets of $992,190.00. On December 31, 2023, the Company had cash of $179,943.00 and total assets of $1,179,800.00. This represents a decrease of $157,200 in cash and a decrease of $187,610.00 in total assets.
3. MANAGER AND EXECUTIVE OFFICERS
Manager Entity: EvolveX Capital, LLC
| Name | Position | Age | Term of Office | Approx. Hours per Week |
| Rodman Schley | Manager | 55 | June 9, 2021 - Present | Full-time |
Executive Officers of Company
| Name | Position | Age | Term of Office | Approx. Hours per Week |
| Rodman Schley | Chief Executive Officer & Chief Financial Officer | 55 | June 9, 2021 - Present | Full-time |
Business Experience
Rodman Schley, Manager, Chief Executive Officer (CEO), Chief Financial Officer (CFO)
Mr. Schley is a serial entrepreneur, real estate investor, real estate valuation expert, award-winning and Emmy nominated television producer and host, and published author whose unique approach to entrepreneurship, investment, business, and leadership has earned him laudatory reviews from entrepreneurs and business leaders across the country.
Mr. Schley has been investing in single-family, vacation home (short-term rentals), multifamily and commercial real estate since the early 1990’s, across several economic cycles and environments.
Mr. Schley is the Founder and Chief Executive Officer of Commercial Valuation Consultants, responsible for the valuation of over $20 billion of vacation home, multifamily and commercial assets since 1998. His forward-thinking vision and exceptional business communication skills earned him an appointment to the Appraisal Institute National Board of Directors. He was awarded the Y.T. and Louise Lee Lum Award for national contributions to the valuation industry. In 2019, he was named the Appraisal Institute’s National Vice President. In 2020, he began a two-year term as Incoming President and President.
No Bankruptcy, Investigations, or Criminal Proceedings
Neither of the Company’s Officers have been part of any bankruptcy proceedings, proceedings whereby there was a material evaluation of the integrity or ability of the Executive Officer, investigations regarding moral turpitude, or criminal proceedings or convictions (excluding traffic violations).
Compensation of Executive Officer and the Manager
Rodman Schley (CEO, CFO) does not receive a salary or compensation within his role as an Executive Officer of the Company.
Manager Fee Schedule
The Manager entity, EvolveX Capital, LLC, will receive fees for the operation of the Company as described in the Manager Fees, below, as well as in its ownership of the Class B Units of the Company detailed in the Security Ownership of Management section, below. The Executive Officers of the Company are compensated through the Manager entity through the fees listed below and appreciation of the Class B Units of the Company.
Reimbursement. The Manager shall be reimbursed by the Company for all expenses, fees, or costs incurred on behalf of the Company, including, without limitation, organizational expenses, legal fees, filing fees, accounting fees, out of pocket costs of reporting to any governmental agencies, insurance premiums, travel, costs of evaluating investments and other costs and expenses.
Organization Fee. As compensation for the time and effort involved in organizing the Company, the Company, may, in the Manager’s sole discretion, pay the Manager the amount of $100,000 upon accepting subscriptions for a total of 500 Units.
Asset Acquisition Fee and Asset Disposition Fee. The Manager (or its designated affiliate(s)) shall be entitled to a one percent (1%) Asset Acquisition Fee and a one percent (1%) Asset Disposition Fee on each Company asset. The Asset Acquisition Fee and Asset Disposition Fee is based on the respective purchase price and sale price of the asset in question and payable at the closing of the acquisition or disposition of each asset, as the case may be, or at such later time, in arrears, as the Manager may determine in its sole discretion.
Asset Management Fee. The Manager (or its designated affiliate(s)) will receive an annual fee equal to one percent (1%) of the aggregate capital contributions, less the allocable portion of capital contributions allocated to any Company asset subject to a capital transaction. In all cases, the Asset Management Fee will be payable monthly, in arrears and the Manager may defer or waive management fees at its discretion.
Property Management Fees. The Manager (or its designated affiliate(s)) shall be entitled to receive market rate property management fees and be reimbursed for all out-of-pocket costs, to be paid monthly, for investments owned and operated by the Company. The Property Management Fee associated with any investment in multifamily and commercial investments should not exceed five percent (5%) of gross revenues derived with respect to each such property, provided however, that the Manager may be paid a greater amount if the same is reasonable and not in excess of the customary real estate property management fee which would be paid to an independent third party in connection with the management of such real estate. Other asset classes will be commensurate with local market rates.
Construction and Broker Fees. The Manager (or its designated affiliate(s)) shall be entitled to receive market rate fees and be reimbursed for all out-of-pocket costs for any construction, construction management and real estate brokerage fees with respect to such services provided to each such property.
| 4. | SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS |
The Company has a total of 100,000 Units comprised of 50,000 Class A (non-voting) Units available to Investors, and 50,000 Class B (voting) Units owned by the Manager entity. Therefore, the Manager of the Company retains half (50%) of the total equity in the Company with its Class B Units of ownership, and all (100%) of the voting interests.
The following table contains certain information as to the number of voting units beneficially owned by (i) each person known by the Company to own beneficially more than 10% of the Company’s units, (ii) each person who is a Manager of the Company, (iii) all persons as a group who are Manager and/or Officers of the Company, and as to the percentage of the outstanding units held by them.
| Title of Class | Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Amount and Nature of Beneficial Ownership Acquirable** | Percent of Class |
| Class B | EvolveX Capital LLC* 7491 Kline Drive Arvada, CO 80005 |
50% | None | 100% |
* Rodman Schley is the managing member of the Manager entity of the Company.
** As of the date of this Offering there are no warrants or option agreements in place providing for the purchase of the Company’s Units.
5. INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS
As of December 31, 2024 and 2023 the Company had a related party receivable of zero and $3,159, respectively. The receivable is due to a related party over payment of financing at year end.
As of December 31, 2024 and 2023 the Company had a related party payable of $4,731 and zero, respectively. The payable is due to related party proceeds used to fund operating expenses
6. OTHER INFORMATION
None.
7. FINANCIAL STATEMENTS
The financial statements included here are the audited annual financial statements for the periods ended December 31, 2023 and December 31, 2024, and are not necessarily indicative of the results that can be expected for the year ended December 31, 2025.
8. EXHIBITS
Exhibit 2A: Certificate of Formation*
Exhibit 2B: Operating Agreement*
Exhibit 4: Subscription Agreement*
Exhibit 8: Escrow Agreement*
Exhibit 11: Accountant’s Consent
*These Exhibits are contained in the Company’s Form 1-A filed on May 24, 2022 and Form 1-SA Dated September 28, 2023.
SIGNATURE PAGE
Pursuant to the requirements of Regulation A, the Issuer has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
EvolveX Equity Fund LLC
By: s/Rodman Schley
Name: Rodman Schley
Title: Managing Member of the Manager, EvolveX Capital LLC
Date: April 15, 2026
Pursuant to the requirements of Regulation A, this report has been signed below by the following persons on behalf of the Issuer and in the capacities and on the dates indicated.
By: s/Rodman Schley
Name: Rodman Schley
Title: Chief Executive Officer and Chief Financial Officer
Date: April 15, 2026