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Ana Sorić / MA in Communications / CEO / +385 91 9080666 / www.oneofthree.biz / [email protected]
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Table of Contents
Page 1
1.0 Executive Summary.............................................................................................................................11.1 Objectives ...................................................................................................................................21.2 Mission ........................................................................................................................................31.3 Keys to Success ........................................................................................................................4
2.0 Company Summary.............................................................................................................................62.1 Company Ownership .................................................................................................................62.2 Start-up Summary ......................................................................................................................7
3.0 Services .............................................................................................................................................104.0 Market Analysis Summary................................................................................................................12
4.1 Market Segmentation ..............................................................................................................164.2 Target Market Segment Strategy...........................................................................................184.3 Service Business Analysis .....................................................................................................18
4.3.1 Competition and Buying Patterns .............................................................................195.0 Strategy and Implementation Summary ..........................................................................................21
5.1 SWOT Analysis ........................................................................................................................215.1.1 Strengths ......................................................................................................................225.1.2 Weaknesses................................................................................................................225.1.3 Opportunities ...............................................................................................................225.1.4 Threats .........................................................................................................................22
5.2 Competitive Edge....................................................................................................................235.3 Marketing Strategy ..................................................................................................................245.4 Sales Strategy..........................................................................................................................26
5.4.1 Sales Forecast ............................................................................................................285.5 Milestones ................................................................................................................................30
6.0 Management Summary ....................................................................................................................316.1 Personnel Plan .........................................................................................................................31
7.0 Financial Plan ....................................................................................................................................327.1 Projections................................................................................................................................327.2 Start-up Funding ......................................................................................................................327.3 Important Assumptions............................................................................................................337.4 Break-even Analysis................................................................................................................337.5 Projected Profit and Loss .......................................................................................................347.6 Projected Cash Flow ...............................................................................................................377.7 Projected Balance Sheet ........................................................................................................387.8 Business Ratios .......................................................................................................................397.9 Long-term Plan.........................................................................................................................41
MindBanking.com
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1.0 Executive Summary
MindBanking.com is a global business networking portal, offering services whichempower users to fully develop manage and build their projects. MindBanking.com is aone-stop-shop which has a certain potential to become fully equipped and serviced globaloffice. MindBanking.com is a console for developing business.
The objective is to create vibrant an interactive online business portal, where biggestand smallest entrepreneurs could meet, providing a generator or incubator of ideas, fornew business opportunities that are about to lead to new businesses, products andservices.
Mindbanking project belongs to the online business social networking online services.Revenue models for this kind of services include subscription fees, advertising, servicesales (pay per piece and subscription), and respectively brokerage.
Our position in the business social networking market would be significant since wewould be offering a unique online working and developing platform and hope to createunique, vibrant and powerful community.
The main objective of MindBanking.com is to become an entrepreneurs' main workingplatform; to become their office, business space and their home page; the first thing tovisit when they go online, as well as the last before going offline; spending an average4 hours per day using MindBanking.com portal/application/platform.
The goal is also to create such a powerful and vibrant community, which wouldrespectively compel investors to become active in searching and "pulling" projects.
Furthermore socio-economic trends like hard labor as well as repetitive labor beingreplaced with machines, technology and robotics, is shaping our social landscape; as well astrends in economy such as domination of services economy and inauguration of post-industry which puts the intellectual production, “virtual” goods and services at the pivotal placein the economy. For example estimated worth of Facebook at the beginning of 2011 havebeen around 50 billion USD; however the value is not estimated as the value of brick andmortar properties, but the equity is measured by the value of its community, quality of itsintellectual goods and services, (and a basic social networking service is free!), and its impactand influence on the social reality.
All mentioned are the arguments that the project has anticipated the future market, neweconomies and new business infrastructure.
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1.1 Objectives
The objective of this project is to perceive the new media and communication world as a(new) business developing platform. Social networks proved to be a new media mantra;however its business developing potential has yet not been proven. Mindbanking portalis as much community and development as it is profit driven. The objective is to createvibrant an interactive online business portal, where biggest and smallest entrepreneurscould meet, providing a generator or incubator of ideas, for new business opportunitiesthat are about to lead to new businesses, products and services. The project has astrong market (or attention) value since its target groups belong to both consumers andbusinesses. MindBanking caters to all business interactions; B2B, B2C, C2B, C2C and allother future ones.
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1.2 Mission
Mindbanking.com generates business ideas that could bring together entrepreneursand potential entrepreneurs. This online service would help generate profit by creatinga community that would among other things develop projects using unique working/development platform, furthermore by constantly upgrading services and by building acommunity. Interaction (a network) of market sectors could create exciting businessscene.
The system used in building infrastructure of the project is drawn from networktheory, system theory and the Attention Economy. The program strives to comprisecomplex and dynamic infrastructure to be able to ensure sustainability as well asconstant progress and development thus constant growth of revenue. The systemand infrastructure of the project will also be continually scrutinized and upgraded.
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1.3 Keys to Success
Although global economy is a reality, only several business enclaves like NewYork, Dubai, Silicon Valley, Hong Kong or similar could claim its businesssupremacy since they represent centers or/and conglomerates of businessactivity. We could say that being in one place gives them the strength or better saidenergy to progress and develop and to become economic forerunner.
MindBanking.com prospers on that same premise. To put in the same space globalcorporations, SME, investors, thriving individuals with new ideas, entrepreneurs,innovators and such, and to deploy its multi-interaction could truly produce newmarketplace as well as new economies or new business idioms.
The project presupposes a vision of a new business scene and its infrastructurethrough the idea – everyone is an entrepreneur. Numerous trends show thatdeveloping own business is the future of economic scene, thus the project meetsthat basic need.
Almost every innovator claims the same – we do not know how to do the business!;MindBanking.com is empowered to deal with the mentioned problem throughoffering business plan application, work and workflow platform, interaction tools andplayful and user-friendly business environment.
Furthermore, the main objective of MindBanking.com is to become anentrepreneurs' main working platform; to become their office, business space andtheir home page; the first thing to visit when they go online, as well as the lastbefore going offline; spending an average 4 hours per day using MindBanking.comportal/application/platform.
The goal is also to create such a powerful and vibrant community, which wouldrespectively compel investors to become active in searching and "pulling" projects.
MindBanking.com thrives on the premise that everyone is a potential entrepreneur;if we furthermore take into consideration digitally converged media environment thatempowers every user to create its own business opportunity, along with the idea thatthe online infrastructure will prevail in the future of business operations, we couldclaim we hit the target. So the strategy proposes for the Mind Banking.com to becomethe platform for creating endless number of (original) business communities and avigorous and self-producing new business scene.
Mindbanking.com is a vision of new economy which presupposes development of thenew market technology, which perpetuates network distribution, niche markets, dynamic-modular production units and such, which would respectively replace mass production.
The project anticipates or even brings about new paradigm shift at a production process at
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large. Some of the trends are already taking place as a part of production process; suchas, fluid working hours and Sunday as a working day shows that our working week hasbeen submitted to significant changes. It is what theoretician Leadbeater in his KnowledgeEconomy calls “graying the calendar” (Leadbeater, 2000).
Furthermore, there is also a trend of working from locations other than office, in smallgroups, using communication tools such as Skype, MSN, or even mobile phoneapplications; thus the conditions for the development of like economy has already beensketched.
Even some new trends in hardware technology are proving the way wecommunicate, work and spend our daily lives is changing. For exampletablet (e.g. Apple iPad, BlackBerry PlayBook, HTC Flyer, Samsung GalaxyTab etc.) trend; book reading devices/tablets (e.g. Kindle). Mentionedtrends show that everything becomes “on the go”, even production.
Furthermore socio-economic trends like hard labor as well as repetitivelabor being replaced with machines, technology and robotics, is shaping oursocial landscape; as well as trends in economy such as domination of serviceseconomy and inauguration of post-industry which puts the intellectualproduction, “virtual” goods and services at the pivotal place in the economy.For example estimated worth of Facebook at the beginning of 2011 have beenaround 50 billion USD; however the value is not estimated as the value ofbrick and mortar properties, but the equity is measured by the value of itscommunity, quality of its intellectual goods and services, (and a basicsocial networking service is free!), and its impact and influence on the socialreality.
All mentioned are the arguments that the project has anticipated thefuture market, new economies and new business infrastructure.
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2.0 Company Summary
Ana Sorić is the bearer of the project MindBanking.com, also, a founder, ownerand a CEO of Jedna od tri d.o.o. / One of Three LLC; company responsible tocarry out MindBanking.com. Furthermore, Ana Soric is a founder of the Sail Mediadepartment and the co-owner and board member of the company Sail LLC. She isa media expert with a master’s degree (MA in Communications) obtained in 2002,from the Universiteit van Amsterdam, International School for Humanities and SocialSciences. Also she has a degree of mag. in Journalism from the Faculty of PoliticalSciences, University of Zagreb. She has been engaged in production, managingand strategizing award winning media: press, TV, internet, animation film, andpersuasive media, as a writer, columnist, editor, producer, account manager,project manager, strategist and consultant. She had positions such as: an editor ofa magazine (3), editor of a TV show, one of the producers of an internationally awardwinning 3D animated movie, main strategist and media consultant for jutarnji.hr(EPH online), etc.For the last couple of years she has been engaged in business strategy, planning
and development.
2.1 Company Ownership
All the companies included in the project are LLC companies. the bearer of theproject is Jedna od tri d.o.o. / One of Three is a LLC, and the owner is Ana Soric.
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2.2 Start-up Summary
Research & Analysis
Trend analysis
Market analysis
Case studies
Comparative analysis
Business info interpretation
Interpretation of goals & Business model proposal
Business Plan
Strategic positioning of a business case
Communication strategy
Proposal for creative concept
Proposal for technical concept
Project diagram development
Business model proposal
Front End & Information Architecture
Communities analysis
Concept elucidation
Content inventory
Building topology
Graphic design concept & development
Documentation - graphic standards
User experience research
Graphic user interface development
Administrative interface
Intranet interface
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Designing Information architecture
Designing Wireframes
Gathering and processing content
CSS
Back-end
Designing data base
Designing web pages
Programming graphic interface
Application building
Data base programming
Documentation - application code
Documentation - system requirements
Installation & implementation
HW plus connection
HTML / Flash
Billing system development
Search engine optimization (SEO)
Beta testing
Maintenance
Mobile application Mobile application prototype development, testing and implementation
Marketing the product
Positioning the product
Marketing plan development
Marketing campaign - launch
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Table: Start-up
Start-up
Requirements
Start-up Expenses
Front End / Design / Information Architecture $9,000
Back-end Development $47,000
Testing & implementation $6,650
Mobile application prototype development $28,000
Total Start-up Expenses $90,650
Start-up Assets
Cash Required $56,000
Other Current Assets $0
Long-term Assets $0
Total Assets $56,000
Total Requirements $146,650
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3.0 Services
Business Networking Service
Create a profi le,Submit idea/project, Browse people, Browse projects,instant messaging,Connect with people,Find investors, and Find collaborators.
Working Platform
Discussion Board, Business Plan Development Application (BPDA), Milestones Alert, Sync(synchronizes with email cl ient, material stored locally etc.), Storage, Define your team,Chat, Whiteboard; all of which enables users to organize, manage and develop theirprojects from A-Z.
Workflow tools (part of Working Platform)
Status Report Alert, Project Update Notification,Task List Management, Project ProgressViewer, My Tasks Reminder., etc.
BPDA Business Plan Development Application (part of Working Platform)
Service of online application for creating business and financial plan, including tables withformulas and instructions.
Investors database
Browse investors, Find investors, Connect with investors.
Legal
Legal FAQ; Custom Legal Advices will be available exclusively in a Large subscriptionpackage; service assumes an attorney answering via email or/and MB instant messaging,any questions subscriber might have regarding legal issues about projects.
Mobile
Mobile service: application customized for web usage, mobile to internet messaging, mobile
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arranging tasks and mobile alerts.
Promote
User will be able to promote the idea or project through the application 15 Minutes of Glory
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4.0 Market Analysis Summary
TREND 1: INCREASE IN TOTAL TIME SPENT ONLINE
Total time spent online up 24.3% in October 2007
Compete published its findings on total time spent online. From October 2006 toOctober 2007 the total time spent online by US online users is up 24.3%.
Source: IT Facts, Nov 29, 07; http://www.itfacts.biz/index.php?id=P9174
86.6% of Internet users spend more than 6 hours a week online
86.6% of internet users now spend 6 hours or more online a week when they are athome, up from 83% at the end of 2006 and 50% at the end of 2005. Perhaps most eyewateringly almost 5% of respondents claimed to spend more than 80 hours a weeksurfing from home, Point Topic reports.
Source: IT Facts, Sep 30, 07; http://www.itfacts.biz/index.php?id=P9004
Average number of hours spent on a weekly basis by American Internet users
1999 : 7 hours
2000 : 7 hours
2001 : 7 hours
2002 : 7 hours
2003 : 9 hours
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2004 : 8 hours
2005 : 9 hours
2006 : 9 hours
2007 : 11 hours
2008 : 14 hours
2009 : 13 hours
source: http://gorumors.com/crunchies/average-time-spent-online-statistics/, 2010
TREND 2: INCREASE IN REVENUE OF SOCIAL NETWORKING PORTALS
Social networks made $400 mln in revenues in 2006
IDC estimates that social networks only made about $400 mln in revenues in 2006, butcould make as much as $1 bln in 2007. IDC expects that most social network services willemploy a mix of business models, including advertising, subscriptions, andecommerce. Of these three models, only advertising scales well enough to make socialnetworks interesting for portals and major media companies.
source: ITFacts; www.itfacts.biz/social-networks-made-400-mln-in-revenues-in-2006/8936
TREND 3: INCREASE (DOMINATION) IN TIME SPENT ON SOCIAL NETWORKING
New and returning visits to US social networks
Rank Name Domain Returning New
1 Myspace www.myspace.com 95% 5%
2 Facebook www.facebook.com 93% 7%
Source: Hitwise
Published on: May 21, 2008 Department: Web traffic
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Who got traffic from search engines in April 2008
Category Percent of Category
Traffic from Search
Engines, Apr-08
Percent Change inShare
of Traffic From Search
Engines, Apr-08 -Apr-07
Percent ofCategory Traffic
from Google, Apr-07
Percent Change in
Share of Traffic From
Google, Apr-08 -Apr-07
Health and Medical 46.00% 3% 30.73% 4%
Travel 33.94% 8% 23.31% 16%
Shopping andClassifieds
25.40% 0% 16.61% 4%
News and Media 21.88% 8% 14.60% 11%
Entertainment 23.79% 15% 15.20% 17%
Business andFinance
18.08% 12% 11.65% 22%
Sports 12.43% 17% 8.37% 24%
Online Video 28.88% 35% 19.70% 46%
Social Networking 16.74% 17% 10.08% 17%
Source: Hitwise
Average US time spent in April 2008
Rank Name Domain Apr 2008 Apr 2007 Growth, YTY
1 Myspace www.myspace.com
29m54s 30m40s -3%
2 Facebook www.facebook.com
20m52s 13m19s 57%
3 myYearbook www.myyearbook.com
32m54s 21m46s 51%
4 Bebo www.bebo.com 30m01s 30m52s -3%
5 Black Planet www.blackplanet.com
24m39s 22m43s 9%
Source: Hitwise
Social Networking Dominates Our Time Spent OnlineSocial networking now eats up twice as much of our online time as any other activity.According to new stats from Nielsen, sites like Facebook and Twitter now account for22.7% of time spent on the web; the next closest activity is online games, which makeup 10.2%.
The stats also show the degree to which social networking is displacing other forms of
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communication, with e-mail as a percentage of online time plunging from 11.5% to8.3% from June 2009 to June 2010. Instant messaging also saw a significant drop inshare, with a 15% decline from last year.
However, e-mail use on mobile is still on the rise – from 37.4% to 41.6% — presumablyas users continue to migrate to smartphones from feature phones.
source: (http://mashable.com/2010/08/02/stats-time-spent-online/,2010)
TREND 4: USAGE OF MOBILE(SMART) PHONES FOR NETWORKING
One Fourth Of Adults in the U.S. Use Mobile AppsMASHABLE - Sep 14 - According to the Pew Internet Project, 82% of U.S. Adults areactive cellphone users, and 43% of those have downloaded apps to their phones. Thisequates to 24% of the adults in the United States. Of these users, 13% have paid for atleast one of their apps. Not surprisingly, games are the most popular downloads. Alsoof note, women favor social networking apps significantly more than men.SORUCE: (http://www.socialnetworkingwatch.com/all_social_networking_statistics/, 2010)
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4.1 Market Segmentation
Target groups
Innovators
– is a main target group, which represents a community using MB.com application in thefirst place to submit ideas and find investors. However, the same group is also the mainuser of all services offered on the MB.com portal. They will try to find collaborators, willuse the working platform and will have a need to use business plan templates and legaladvices. More detailed segmentation: Entrepreneurs, SME-s, Inventors, Mediaprofessionals, Artists, New media freaks, Media semi-professionals, Independentscholars, Independent researchers, Universities, Grad Students, etc. In the broadscope our main target goup are early adopters/trend setters/tech savy users.
Investors
– are uising portal in order to find ideas, projects, products, business solutions etc.Segmentation in this group could also be detailed as: corporations, SME-s, individualinvestors, venture capital houses, producers, publishers etc. Investors will also have tobuild their profile through company logo, investment portfolio, project portfolio and such.
Collaborators
– is a target group mainly seeking for interesting projects to collaborate in, to getexperience, and respectivelly would become Innovators.User Scenario
User 1 – innovator
Fruitful idea maker sits in front of the Facebook sending his friends chocolate, gummybears and smiles; throwing sheep and philosophers at his colleagues; waiting forsomething exciting to appear on a horizon. He (let us say is a he) is inhibited to thinkabout piles of ideas stocked in his drawer, because every time he does, a rush offrustration and disappointment overwhelms him. Suddenly information appears like anepiphany, a thunderstruck. MindBanking.com – submit ideas, find collaborators,develop projects, and find investors.
Just what I needed! I am going there right away!
After exploring possibilities MindBanking is offering, he starts to submit ideas. Oh, myideas seem to be even better than I thought, mumbles he, let us now find somepeople who could be interested to work with me on my projects. Swiftly he became afriend with a programmer from Indonesia and a developer from New York and they
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started to develop one of his projects.
Going deeper into the MindBanking portal he discovers he could do everything in oneplace in order to develop his project: he can manage it through Workflow tools, develop itthrough the Workingplatform, he finds a business plan development application extremelyuseful, as well as a database of investors.
After a couple of months MindBanking.com becomes his global office, his conditio sinequa non. Every day he wakes up and starts his working day at the MindBanking.com. Hespends the whole day managing his tasks, checking status of collaborators tasks,setting new tasks, managing possible problems in a project development,communicating with collaborators, finding investors or communicating with investors hehad already make a connection with, developing business plan(s) etc., in a nutshell,developing his business. And suddenly like he never intended to, finds he had becamean entrepreneur. Even better, he realizes that around him grew a brand new, exciting andvibrant business scene.
User 2 – investor
She is sitting with the head in her hands, under pressure to find new business ideas;but where to find them? Desperate, she opens a www.ft.com. Yeah,like they are goingto offer fresh ideas on a silver platter, crosses her mind. She opens the www.ft.compage and there it is, a banner: MindBanking.com, the source of business ideas! All of asudden the world seems completely different. She rushes to the MindBanking.com, andfinds not only what she was desperately looking for, but an extraordinary vigorous andexceptional business scene. At once she finds couple of mind-blowing projectsmatching her interest, and right away starts communication with the team working on it.Her business routine takes a different shape.
Every morning she checks what has been done with the project she invested into. If thereare any alerts, how the production is going. Also she is onto new ideas and new projects.She had moved her business activity almost entirely at online sphere creating not onlya global office but an entire new business.
Table: Market Analysis
Market Analysis
2011 2012 2013 2014 2015
Potential Customers Growth CAGR
Innovators 260% 20,000 72,000 259,200 933,120 3,359,232 260.00%
Investors 180% 14,000 39,200 109,760 307,328 860,518 180.00%
Collaborators 370% 30,000 141,000 662,700 3,114,690 14,639,043 370.00%
Total 314.32% 64,000 252,200 1,031,660 4,355,138 18,858,793 314.32%
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4.2 Target Market Segment Strategy
The project focuses on this target groups because they are main production force,three pillars of any market; people with ideas, developers and investors (money force).Communicating to them, bringing them together and engaging them in a production (evenof their own projects) could produce uncanny business scene, which of course meansraising attention to high level consequently generating revenue.
4.3 Service Business Analysis
Mindbanking project belongs to the online business social networking online services.Revenue models for this kind of services include subscriptionfees, advertising,service sales (pay per piece and subscription), and respectively brockerage.
Xing.com – mainly subsrciption fees (premium membership)
LinkedIn.com – mainly advertising
Facebook.com – mainly advertising
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4.3.1 Competition and Buying Patterns
Broad market
Xing.com
Advantages for Mindbanking
Xing.com merely offers database of professionals, no other services; it takes a lot ofeffort to utilize the service they offer.
Three moths premium membership plus a moth gratis costs 18 Euros, too expensive,especially for young people struggling in a entrepreneurs world.
Threats
for MindbankingXing.com already has 7 million users (2009).
LinkedIn.com
Advantages for MindBanking
Our research shows social networking platforms that do not offer added value butmerely profile upload and possibility to connect with friends and colleagues do nothave much action going on and as a result the portal quickly loses its attention. Such isthe case with LinkedIn. Our added value: MindBanking.com is a one-stop-shop whichhas a certain potential to become fully equipped and serviced global office.MindBanking.com is a console for developing business.
Threatsfor Mindbanking
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LinkedIn.com has an estimated 43 million users in 2009.
According to the LinkedIn website, by April 2010 there were more than 65 millionmembers, located in more than 200 countries.
More than 500 million active users.
source: (http://www.facebook.com/press/info.php?statistics, 2010)
Narrow market
Projects sharing the market with MindBanking.com; a niche market yet to be created.
1. Kickstarter (http://www.kickstarter.com/)
2. Amazee (http://www.amazee.com/)
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3. OpenInvo (http://www.openinvo.com/)
All of the mentioned businesses do not have significant market share. However, theirrelatively recent appearance show the market calls for a communities/applications thatoffer a tool that can enable collaboration on a projects, also stock markets for ideas, or tocreate the places where capital and ideas/innovations could meet. Furthermore, insteadof posing as a threat for MindBanking.com, it represents an opportunity since thementioned projects would create the niche market.
5.0 Strategy and Implementation Summary
5.1 SWOT Analysis
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5.1.1 Strengths
1. Multi-interactional environment - Hypermedia; which means endless number ofinteractions, thus endless possibility of development and growth.
2. Endlessly upgradeable / expandable environment
3. Interactions of all market sectors
4. Creating new business community
5. Strong attention and market value of the project
5.1.2 Weaknesses
1. Relatively expensive production
2. Relatively slow production
3. Huge
5.1.3 Opportunities
1. To create new markets, economies and values
2. To create new communication paradigm
3. To generate substantial revenue
5.1.4 Threats
1. Strong competition
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5.2 Competitive Edge
Main social/business network websites are LinkedIn, Xing, and of course Facebook,absolute winner in number of registered users, impact and revenue.
Xing.com as a business (social) network was founded in 2003 had 5 million users in2008, and an estimated revenue of €10.1 million in 2006; source Wikipedia.com, http://en.wikipedia.org/wiki/XING, April 2008. In 2009 number of users for Xing.com grew to7.000.000, representing 40% growth.
LinkedIn.com, had an estmated 20 million users in 2008 and 43 million in 2009.
Facebook.com was founded in February 2004, had an estimated 69 million users inJanuary 2008 (source, Facebook, January 2008), and revenue of 150 million USD;(source, Forbes, March 6, 2008.) In 2009, number of users grew to 250.000.000,representing 262% growth. Potential for revenue growth from that position is huge.
Facebook ended 2008 making between $280 million and $300 million, according tomany reports. The company’s revenues likely reached between $600 million and $700million for 2009. sources estimate the company could make between $1 billion and $1.1billion in total revenue this year. (source: Inside Facebook; www.insidefacebook.com/2010/03/02/facebook-made-up-to-700-million-in-2009-on-track-towards-1-1-billion-in-2010/, 2010)
Our position in the business social networking market would be significant since wewould be offering a unique online working and developing platform. In a nutshell, ourcompetitive advantage is to be the first in a global market offering services to helpdevelop and deploy projects online. Furthermore, if we compare ourselves with othersocial networking portals, even the business ones, like LinkedIn.com and Xing.com, webelieve that our portal will have much higher business utilization than any of them.
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5.3 Marketing Strategy
Marketing strategy lies on using exact or narrow marketing channel foreach target group (community). For Inventors, our most importanttarget group, we intend to use mainly Facebook social ads andrespectively Google Adwords. We can position our key target group asspending a lot of their time on Facebook, since it is a rather creative portalin entertainment kind of way, and bypassing business social networkingportals since they do not offer much and require much effort forbusiness utilization. The plan is to draw their attention from Facebook andchannel their energy and ideas towards production andentrepreneurship. Furthermore, for that target group we wouldn't useonline banners as a mean of communication, but more involving Socialads (social groups, fan clubs, applications, etc.)
Target group Investors also require special attention. The strategy is toreach them at FT.com and the Time Magazine online or New York times.
Target group Collaborators will be reached through banners and WOM onthe LinkedIn.com, and other social networking portals.
Launch campaign will consist of two phases:
Phase 1 (Beta testing period)
Since we will have 45 days of Beta testing period the strategy is for thatperiod to deploy Facebook social ads, Google Adwords, WOM, guerillamarketing (blogs, forums, chats…) which will serve for all three targetgroups. In this kind of communication methods possibly the leastcovered are Investors.
Phase 2 (100% ready)
Banners on Facebook.com, LinkedIn.com, FT.com, Time Magazine onlineor New York times online; 100.000 impressions.
1.0. Beta testing campaign
1.1. Facebook - social ads and applications - 10.000 USD
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1.2. Google Adwords - around 20 key words for 1 month - 1.000 USD
1.3 LinkedIn - Direct Ads, targeted on communities - 10.000 USD
1.4 Guerilla marketing & WOM daily for a month on blogs, forums etc. -1.000 USD
2.0 100 % ready campaign
Strategy is to keep running Facebook social ads and Google Adwords allthe time. Furthermore, to put banners on business and news portalswith around 100.000 impressions, one by one.
2.1 NYTimes.com - around 100.000 impressions - 11.000 USD
2.2 FT.com - 468x60 banner, contextual targeting (business) plusgeographical, Cost per Thousand Impressions (CPM) = 55, 00 GBP.Plan: 100.000 impressions = 5.500,00 GBP = 11.000,00 USD.
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5.4 Sales Strategy
Beta testing period will last for 45 days. After that the subscription fee will be deployed asdescribed.
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Additional storage of 3 GB will be charged 5 USD per month and offered as a 3/6/12months package.
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Subscription will be available as a 3/6/12 months packages:
As for the advertising, the aqasion is simple; greater the number of user (eye-balls),more advertising space is sold. Great advantage with internet advertising is thatwe are not only able to count every single user, we also know their names,preferences and interests.
5.4.1 Sales Forecast
We predicted that by the end of the first year we will have 64.000 active users, whichof 50.000 would spend for our subscription about 50 USD per year, we could haverevenue of 2.500.000 USD. We assume our users will be willing to pay 50 USD per year.The price definitely represents value for money, since some other social networkingportals charge much more for less utilization.
Advertising revenues are more of a educated guess and could only be higher sinceglobaly revenues from online advertising are growing every year.
In 2012 21% of global ad spending will happen online
Interactive advertising revenues will increase significantly from $45 bln in 2007 to $147bln globally in 2012, representing a 23.4%, according to Kelsey Group. Interactiveadvertising, which comprises search (including local search), display advertising,classifieds and other interactive ad products, grew its share of global advertisingrevenues from 6.1% in 2006 to 7.4% in 2007. By 2012 Kelsey Group analysts expect theinteractive share of global ad spending will reach 21%. During the forecast period(2007-2012), the United States will see interactive advertising revenues grow from$22.5 billion to $62.4 bln (22.6% CAGR), with interactive revenues in Canadaincreasing from $1.3 blnto $3.3 billion (21.3% CAGR).
Source: ITFacts; www.itfacts.biz/in-2012-21-of-global-ad-spending-will-happen-online/10034
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Table: Sales Forecast
Sales Forecast
FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
Sales
Subscriptions fees $230,143 $6,000,000 $21,000,000 $28,000,000 $48,000,000
Advertising space $314,080 $5,000,000 $17,000,000 $25,000,000 $41,000,000
Service sales $0 $1,000,000 $5,000,000 $9,000,000 $16,000,000
Total Sales $544,223 $12,000,000 $43,000,000 $62,000,000 $105,000,000
Direct Cost of Sales FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
Research & Analysis $5,745 $480,000 $750,000 $1,650,000 $2,176,000
Tech Maintenance $26,000 $1,038,000 $2,076,000 $2,976,000 $4,376,000
Hardware & Development $37,776 $1,567,000 $3,584,000 $4,376,000 $6,396,000
Marketing & Sales $80,040 $2,088,000 $5,036,000 $7,376,000 $10,376,000
Management $19,922 $920,000 $1,700,000 $2,176,000 $3,177,000
Subtotal Direct Cost of Sales $169,483 $6,093,000 $13,146,000 $18,554,000 $26,501,000
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5.5 Milestones
Table: Milestones
Milestones
Milestone Start Date End Date Budget Manager Department
Application Finalization 2/25/2011 8/25/2011 $395,000 Ana Soric IT, Design
Launch Marketing Camp 8/28/2011 9/28/2011 $50,000 Ana Soric Marketing
Mobile Application
Development
9/1/2011 2/1/2012 $650,000 Ana Soric IT
Launch Mobile Marketing Camp 2/1/2012 3/1/2012 $400,000 Ana Soric Marketing
DB Redesign 3/1/2012 9/1/2012 $1,300,000 Ana Soric IT, Design
Launch Redesign Marketing
Camp
9/1/2012 10/1/2012 $1,300,000 Ana Soric Marketing
Next phase planning &
development
10/1/2012 6/1/2013 $1,000,000 Ana Soric R&D
Totals $5,095,000
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6.0 Management Summary
6.1 Personnel Plan
In the first year the plan is to hire as few personnel as possible. Most of thedevelopment and production will be done by outsourcing. In the second FY when weanticipate ROI to start pouring in, would hire small but high quality team. In the FYs thatfollow we would expand significantly our personnel, with the special consideration onR&D (Research and Development) team, and would form serious Board ofDirectors.
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Table: Personnel
Personnel Plan
FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
Strategy, Consultancy, Management, Board $20,000 $130,000 $350,000 $550,000 $670,000
Design & Development $13,000 $300,000 $600,000 $1,000,000 $1,646,000
R & D $0 $250,000 $550,000 $1,100,000 $2,646,000
Tech Maintenance $7,000 $170,000 $370,000 $430,000 $1,130,000
Customer Support $6,000 $150,000 $250,000 $450,000 $696,000
Legal $0 $97,000 $160,000 $190,000 $696,000
Marketing $0 $195,000 $250,000 $550,000 $1,046,000
Maintenance $0 $95,000 $110,000 $150,000 $349,000
Total People 0 0 0 0 0
Total Payroll $46,000 $1,387,000 $2,640,000 $4,420,000 $8,879,000
7.0 Financial Plan
7.1 Projections
7.2 Start-up Funding
It is planned that the start-up funding will be mainly covered with investors funding.Although it is planned to finance part of the investment via loan. The amount of theloan would be around 140.000 USD.
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Table: Start-up Funding
Start-up Funding
Start-up Expenses to Fund $90,650
Start-up Assets to Fund $56,000
Total Funding Required $146,650
Assets
Non-cash Assets from Start-up $0
Cash Requirements from Start-up $56,000
Additional Cash Raised $0
Cash Balance on Starting Date $56,000
Total Assets $56,000
Liabil ities and Capital
Liabil ities
Current Borrowing $0
Long-term Liabil ities $146,650
Accounts Payable (Outstanding Bills) $0
Other Current Liabil ities (interest-free) $0
Total Liabil ities $146,650
Capital
Planned Investment
Owner
Investor $0
Additional Investment Requirement $0
Total Planned Investment $0
Loss at Start-up (Start-up Expenses) ($90,650)
Total Capital ($90,650)
Total Capital and Liabil ities $56,000
Total Funding $146,650
7.3 Important Assumptions
7.4 Break-even Analysis
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Table: Break-even Analysis
Break-even Analysis
Monthly Revenue Break-even $39,020
Assumptions:
Average Percent Variable Cost 31%
Estimated Monthly Fixed Cost $26,868
7.5 Projected Profit and Loss
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Table: Profit and Loss
Pro Forma Profit and Loss
FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
Sales $544,223 $12,000,000 $43,000,000 $62,000,000 $105,000,000
Direct Cost of Sales $169,483 $6,093,000 $13,146,000 $18,554,000 $26,501,000
Other Costs of Sales $16,082 $1,700,000 $3,200,000 $5,996,600 $10,707,359
Total Cost of Sales $185,564 $7,793,000 $16,346,000 $24,550,600 $37,208,359
Gross Margin $358,659 $4,207,000 $26,654,000 $37,449,400 $67,791,641
Gross Margin % 65.90% 35.06% 61.99% 60.40% 64.56%
Expenses
Payroll $46,000 $1,387,000 $2,640,000 $4,420,000 $8,879,000
Marketing/Promotion $15,758 $850,000 $2,200,000 $3,766,900 $6,474,557
Depreciation $0 $0 $0 $0 $0
Rent $38,961 $300,000 $400,000 $970,000 $1,345,046
Util ities $19,761 $140,000 $190,000 $294,600 $494,600
Insurance $35,707 $50,000 $70,000 $145,850 $254,600
Payroll Taxes $166,230 $294,000 $585,000 $769,000 $1,650,000
Total Operating Expenses $322,416 $3,021,000 $6,085,000 $10,366,350 $19,097,803
Profit Before Interest and Taxes $36,243 $1,186,000 $20,569,000 $27,083,050 $48,693,838
EBITDA $36,243 $1,186,000 $20,569,000 $27,083,050 $48,693,838
Interest Expense $14,164 $11,873 $9,295 $6,717 $4,140
Taxes Incurred $6,624 $352,238 $6,167,911 $8,122,900 $14,606,909
Net Profit $15,455 $821,889 $14,391,794 $18,953,433 $34,082,789
Net Profit/Sales 2.84% 6.85% 33.47% 30.57% 32.46%
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7.6 Projected Cash Flow
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Table: Cash Flow
Pro Forma Cash Flow
FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
Cash Received
Cash from Operations
Cash Sales $544,223 $12,000,000 $43,000,000 $62,000,000 $105,000,000
Subtotal Cash from Operations $544,223 $12,000,000 $43,000,000 $62,000,000 $105,000,000
Additional Cash Received
Sales Tax, VAT, HST/GST Received $125,171 $2,760,000 $9,890,000 $14,260,000 $24,150,000
New Current Borrowing $0 $0 $0 $0 $0
New Other Liabil ities (interest-free) $0 $0 $0 $0 $0
New Long-term Liabil ities $0 $0 $0 $0 $0
Sales of Other Current Assets $0 $0 $0 $0 $0
Sales of Long-term Assets $0 $0 $0 $0 $0
New Investment Received $1,680,000 $3,700,000 $0 $0 $0
Subtotal Cash Received $2,349,394 $18,460,000 $52,890,000 $76,260,000 $129,150,000
Expenditures FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
Expenditures from Operations
Cash Spending $46,000 $1,387,000 $2,640,000 $4,420,000 $8,879,000
Bill Payments $372,884 $9,096,246 $24,638,582 $37,586,154 $60,113,967
Subtotal Spent on Operations $418,884 $10,483,246 $27,278,582 $42,006,154 $68,992,967
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0 $0 $0
Other Liabil ities Principal Repayment $0 $0 $0 $0 $0
Long-term Liabil ities Principal Repayment $15,036 $25,776 $25,776 $25,776 $25,776
Purchase Other Current Assets $0 $0 $0 $0 $0
Purchase Long-term Assets $0 $0 $0 $0 $0
Dividends $0 $0 $0 $0 $0
Subtotal Cash Spent $433,920 $10,509,022 $27,304,358 $42,031,930 $69,018,743
Net Cash Flow $1,915,475 $7,950,978 $25,585,642 $34,228,070 $60,131,257
Cash Balance $1,971,475 $9,922,452 $35,508,094 $69,736,164 $129,867,422
7.7 Projected Balance Sheet
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Table: Balance Sheet
Pro Forma Balance Sheet
FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
Assets
Current Assets
Cash $1,971,475 $9,922,452 $35,508,094 $69,736,164 $129,867,422
Other Current Assets $0 $0 $0 $0 $0
Total Current Assets $1,971,475 $9,922,452 $35,508,094 $69,736,164 $129,867,422
Long-term Assets
Long-term Assets $0 $0 $0 $0 $0
Accumulated Depreciation $0 $0 $0 $0 $0
Total Long-term Assets $0 $0 $0 $0 $0
Total Assets $1,971,475 $9,922,452 $35,508,094 $69,736,164 $129,867,422
Liabil ities and Capital FY 2012 FY 2013 FY 2014 FY 2015 FY 2016
Current Liabil ities
Accounts Payable $109,884 $804,749 $2,134,373 $3,174,786 $5,099,031
Current Borrowing $0 $0 $0 $0 $0
Other Current Liabil ities $125,171 $2,885,171 $12,775,171 $27,035,171 $51,185,171
Subtotal Current Liabil ities $235,056 $3,689,920 $14,909,544 $30,209,958 $56,284,202
Long-term Liabil ities $131,614 $105,838 $80,062 $54,286 $28,510
Total Liabil ities $366,670 $3,795,758 $14,989,606 $30,264,244 $56,312,712
Paid-in Capital $1,680,000 $5,380,000 $5,380,000 $5,380,000 $5,380,000
Retained Earnings ($90,650) ($75,195) $746,694 $15,138,488 $34,091,921
Earnings $15,455 $821,889 $14,391,794 $18,953,433 $34,082,789
Total Capital $1,604,805 $6,126,694 $20,518,488 $39,471,921 $73,554,709
Total Liabil ities and Capital $1,971,475 $9,922,452 $35,508,094 $69,736,164 $129,867,422
Net Worth $1,604,805 $6,126,694 $20,518,488 $39,471,921 $73,554,709
7.8 Business Ratios
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Table: Ratios
Ratio Analysis
FY 2012 FY 2013 FY 2014 Industry Profile
Sales Growth 0.00% 2104.98% 258.33% 10.93%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 52.04%
Total Current Assets 100.00% 100.00% 100.00% 76.18%
Long-term Assets 0.00% 0.00% 0.00% 23.82%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabil ities 11.92% 37.19% 41.99% 33.87%
Long-term Liabil ities 6.68% 1.07% 0.23% 13.22%
Total Liabil ities 18.60% 38.25% 42.21% 47.09%
Net Worth 81.40% 61.75% 57.79% 52.91%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 65.90% 35.06% 61.99% 100.00%
Selling, General & Administrative Expenses 63.06% 28.21% 28.52% 74.12%
Advertising Expenses 0.00% 0.00% 0.00% 2.32%
Profit Before Interest and Taxes 6.66% 9.88% 47.83% 2.90%
Main Ratios
Current 8.39 2.69 2.38 1.74
Quick 8.39 2.69 2.38 1.37
Total Debt to Total Assets 18.60% 38.25% 42.21% 58.31%
Pre-tax Return on Net Worth 1.38% 19.16% 100.20% 6.41%
Pre-tax Return on Assets 1.12% 11.83% 57.90% 15.38%
Additional Ratios FY 2012 FY 2013 FY 2014
Net Profit Margin 2.84% 6.85% 33.47% n.a
Return on Equity 0.96% 13.41% 70.14% n.a
Activity Ratios
Accounts Payable Turnover 4.39 12.17 12.17 n.a
Payment Days 27 17 21 n.a
Total Asset Turnover 0.28 1.21 1.21 n.a
Debt Ratios
Debt to Net Worth 0.23 0.62 0.73 n.a
Current Liab. to Liab. 0.64 0.97 0.99 n.a
Liquidity Ratios
Net Working Capital $1,736,419 $6,232,532 $20,598,550 n.a
Interest Coverage 2.56 99.89 2,212.91 n.a
Additional Ratios
Assets to Sales 3.62 0.83 0.83 n.a
Current Debt/Total Assets 12% 37% 42% n.a
Acid Test 8.39 2.69 2.38 n.a
Sales/Net Worth 0.34 1.96 2.10 n.a
Dividend Payout 0.00 0.00 0.00 n.a
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7.9 Long-term Plan
Table: Long-term
Long-term
FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
Sales $544,223 $12,000,0
00
$43,000,0
00
$62,000,0
00
$105,000,
000
$232,400,
000
$498,500,
000
$654,000,
000
$860,000,
000
$999,000,
000
Cost of Sales $185,564 $7,793,00
0
$16,346,0
00
$24,550,6
00
$37,208,3
59
$95,000,0
00
$190,000,
000
$273,000,
000
$399,000,
000
$420,000,
000
Gross Margin $358,659 $4,207,00
0
$26,654,0
00
$37,449,4
00
$67,791,6
41
$137,400,
000
$308,500,
000
$381,000,
000
$461,000,
000
$579,000,
000
Gross Margin % 65.90% 35.06% 61.99% 60.40% 64.56% 59.12% 61.89% 58.26% 53.60% 57.96%
Operating Expenses $322,416 $3,021,00
0
$6,085,00
0
$10,366,3
50
$19,097,8
03
$68,000,0
00
$160,000,
000
$238,000,
000
$300,000,
000
$360,000,
000
Operating Income $36,243 $1,186,00
0
$20,569,0
00
$27,083,0
50
$48,693,8
38
$69,400,0
00
$148,500,
000
$143,000,
000
$161,000,
000
$219,000,
000
Net Income $15,455 $821,889 $14,391,7
94
$18,953,4
33
$34,082,7
89
$69,374,2
24
$148,474,
224
$142,974,
224
$160,990,
016
$219,000,
000
Current Assets $1,971,47
5
$9,922,45
2
$35,508,0
94
$69,736,1
64
$129,867,
422
$0 $0 $0 $0 $0
Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Current Liabil ities $235,056 $3,689,92
0
$14,909,5
44
$30,209,9
58
$56,284,2
02
$0 $0 $0 $0 $0
Long-term Liabil ities $131,614 $105,838 $80,062 $54,286 $28,510 $25,776 $25,776 $25,776 $9,984 $0
Equity $1,604,80
5
$6,126,69
4
$20,518,4
88
$39,471,9
21
$73,554,7
09
$69,374,2
24
$148,474,
224
$142,974,
224
$160,990,
016
$219,000,
000
Appendix
Page 1
Table: Sales Forecast
Sales Forecast
Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Sales
Subscriptions fees 0% $0 $0 $0 $0 $0 $0 $0 $23,400 $38,743 $47,300 $57,600 $63,100
Advertising space 0% $0 $0 $0 $0 $0 $0 $0 $0 $45,480 $65,000 $87,600 $116,000
Service sales 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Sales $0 $0 $0 $0 $0 $0 $0 $23,400 $84,223 $112,300 $145,200 $179,100
Direct Cost of Sales Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Research & Analysis $0 $0 $0 $0 $0 $0 $0 $1,149 $1,149 $1,149 $1,149 $1,149
Tech Maintenance $0 $0 $0 $0 $0 $0 $0 $4,000 $4,000 $6,000 $6,000 $6,000
Hardware & Development $2,500 $0 $0 $0 $0 $0 $0 $3,960 $4,356 $7,120 $9,200 $10,640
Marketing & Sales $3,000 $0 $0 $0 $0 $0 $0 $6,700 $7,340 $13,000 $20,000 $30,000
Management $1,500 $0 $0 $0 $0 $0 $0 $3,180 $3,400 $3,480 $3,480 $4,882
Subtotal Direct Cost of Sales $7,000 $0 $0 $0 $0 $0 $0 $18,989 $20,245 $30,749 $39,829 $52,671
Appendix
Page 2
Table: Personnel
Personnel Plan
Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Strategy, Consultancy, Management, Board 0% $2,000 $2,000 $2.000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2.000 $2,000 $2,000
Design & Development 0% $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $2,000
R & D 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Tech Maintenance 0% $0 $0 $0 $0 $0 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Customer Support 0% $0 $0 $0 $0 $0 $0 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Legal 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Marketing 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Maintenance 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total People 0 0 0 0 0 0 0 0 0 0 0 0
Total Payroll $3,000 $3,000 $1,000 $3,000 $3,000 $4,000 $5,000 $5,000 $5,000 $3,000 $5,000 $6,000
Appendix
Page 3
Table: Profit and Loss
Pro Forma Profit and Loss
Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Sales $0 $0 $0 $0 $0 $0 $0 $23,400 $84,223 $112,300 $145,200 $179,100
Direct Cost of Sales $7,000 $0 $0 $0 $0 $0 $0 $18,989 $20,245 $30,749 $39,829 $52,671
Other Costs of Sales $664 $703 $811 $963 $1,090 $1,210 $1,358 $1,472 $1,691 $1,874 $2,013 $2,234
Total Cost of Sales $7,664 $703 $811 $963 $1,090 $1,210 $1,358 $20,461 $21,936 $32,623 $41,842 $54,904
Gross Margin ($7,664) ($703) ($811) ($963) ($1,090) ($1,210) ($1,358) $2,939 $62,287 $79,677 $103,358 $124,196
Gross Margin % 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 12.56% 73.95% 70.95% 71.18% 69.34%
Expenses
Payroll $3,000 $3,000 $1,000 $3,000 $3,000 $4,000 $5,000 $5,000 $5,000 $3,000 $5,000 $6,000
Marketing/Promotion $0 $0 $0 $0 $0 $0 $0 $1,166 $3,056 $3,096 $3,560 $4,880
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $2,806 $2,776 $2,843 $3,383 $3,408 $3,360 $3,360 $3,424 $3,408 $3,376 $3,408 $3,408
Utilities $1,350 $1,447 $1,474 $1,458 $1,474 $1,441 $1,441 $1,612 $1,800 $1,920 $2,088 $2,256
Insurance 15% $1,949 $2,184 $2,352 $2,352 $2,472 $2,544 $2,735 $3,023 $3,359 $3,696 $4,176 $4,864
Payroll Taxes $7,360 $7,780 $8,410 $9,040 $14,500 $16,866 $17,034 $17,426 $17,006 $17,006 $17,006 $16,796
Total Operating Expenses $16,466 $17,187 $16,079 $19,233 $24,854 $28,211 $29,570 $31,651 $33,629 $32,094 $35,238 $38,204
Profit Before Interest and Taxes ($24,129) ($17,890) ($16,890) ($20,196) ($25,945) ($29,421) ($30,928) ($28,712) $28,658 $47,583 $68,120 $85,992
EBITDA ($24,129) ($17,890) ($16,890) ($20,196) ($25,945) ($29,421) ($30,928) ($28,712) $28,658 $47,583 $68,120 $85,992
Interest Expense $1,222 $1,222 $1,222 $1,222 $1,222 $1,204 $1,186 $1,168 $1,150 $1,133 $1,115 $1,097
Taxes Incurred ($7,605) ($5,734) ($5,434) ($6,425) ($8,150) ($9,188) ($9,634) ($8,964) $8,252 $13,935 $20,102 $25,469
Net Profit ($17,746) ($13,378) ($12,679) ($14,992) ($19,017) ($21,438) ($22,480) ($20,916) $19,255 $32,516 $46,904 $59,427
Net Profit/Sales 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% -89.39% 22.86% 28.95% 32.30% 33.18%
Appendix
Page 4
Table: Cash Flow
Pro Forma Cash Flow
Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Cash Received
Cash from Operations
Cash Sales $0 $0 $0 $0 $0 $0 $0 $23,400 $84,223 $112,300 $145,200 $179,100
Subtotal Cash from Operations $0 $0 $0 $0 $0 $0 $0 $23,400 $84,223 $112,300 $145,200 $179,100
Additional Cash Received
Sales Tax, VAT, HST/GST Received 23.00% $0 $0 $0 $0 $0 $0 $0 $5,382 $19,371 $25,829 $33,396 $41,193
New Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Investment Received $0 $0 $0 $130,000 $0 $0 $0 $250,000 $0 $0 $0 $1,300,000
Subtotal Cash Received $0 $0 $0 $130,000 $0 $0 $0 $278,782 $103,594 $138,129 $178,596 $1,520,293
Expenditures Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Expenditures from Operations
Cash Spending $3,000 $3,000 $1,000 $3,000 $3,000 $4,000 $5,000 $5,000 $5,000 $3,000 $5,000 $6,000
Bill Payments $492 $14,600 $10,422 $11,689 $12,127 $16,064 $17,439 $18,208 $40,005 $60,529 $77,335 $93,975
Subtotal Spent on Operations $3,492 $17,600 $11,422 $14,689 $15,127 $20,064 $22,439 $23,208 $45,005 $63,529 $82,335 $99,975
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0 $0 $0 $2,148 $2,148 $2,148 $2,148 $2,148 $2,148 $2,148
Purchase Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Purchase Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Spent $3,492 $17,600 $11,422 $14,689 $15,127 $22,212 $24,587 $25,356 $47,153 $65,677 $84,483 $102,123
Net Cash Flow ($3,492) ($17,600) ($11,422) $115,311 ($15,127) ($22,212) ($24,587) $253,426 $56,442 $72,452 $94,113 $1,418,170
Cash Balance $52,508 $34,908 $23,487 $138,798 $123,671 $101,459 $76,872 $330,298 $386,740 $459,192 $553,305 $1,971,475
Appendix
Page 5
Table: Balance Sheet
Pro Forma Balance Sheet
Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Assets Starting Balances
Current Assets
Cash $56,000 $52,508 $34,908 $23,487 $138,798 $123,671 $101,459 $76,872 $330,298 $386,740 $459,192 $553,305 $1,971,475
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $56,000 $52,508 $34,908 $23,487 $138,798 $123,671 $101,459 $76,872 $330,298 $386,740 $459,192 $553,305 $1,971,475
Long-term Assets
Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Assets $56,000 $52,508 $34,908 $23,487 $138,798 $123,671 $101,459 $76,872 $330,298 $386,740 $459,192 $553,305 $1,971,475
Liabilities and Capital Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Current Liabilities
Accounts Payable $0 $14,254 $10,032 $11,289 $11,593 $15,483 $16,857 $16,897 $38,006 $57,969 $74,225 $90,186 $109,884
Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $5,382 $24,753 $50,582 $83,978 $125,171
Subtotal Current Liabilities $0 $14,254 $10,032 $11,289 $11,593 $15,483 $16,857 $16,897 $43,388 $82,722 $124,807 $174,165 $235,056
Long-term Liabilities $146,650 $146,650 $146,650 $146,650 $146,650 $146,650 $144,502 $142,354 $140,206 $138,058 $135,910 $133,762 $131,614
Total Liabilities $146,650 $160,904 $156,682 $157,939 $158,243 $162,133 $161,359 $159,251 $183,594 $220,780 $260,717 $307,927 $366,670
Paid-in Capital $0 $0 $0 $0 $130,000 $130,000 $130,000 $130,000 $380,000 $380,000 $380,000 $380,000 $1,680,000
Retained Earnings ($90,650) ($90,650) ($90,650) ($90,650) ($90,650) ($90,650) ($90,650) ($90,650) ($90,650) ($90,650) ($90,650) ($90,650) ($90,650)
Earnings $0 ($17,746) ($31,124) ($43,803) ($58,795) ($77,812) ($99,250) ($121,730) ($142,646) ($123,391) ($90,875) ($43,971) $15,455
Total Capital ($90,650) ($108,396) ($121,774) ($134,453) ($19,445) ($38,462) ($59,900) ($82,380) $146,704 $165,959 $198,475 $245,379 $1,604,805
Total Liabilities and Capital $56,000 $52,508 $34,908 $23,487 $138,798 $123,671 $101,459 $76,872 $330,298 $386,740 $459,192 $553,305 $1,971,475
Net Worth ($90,650) ($108,396) ($121,774) ($134,453) ($19,445) ($38,462) ($59,900) ($82,380) $146,704 $165,959 $198,475 $245,379 $1,604,805
1
Appendix
Table – work and services already invested
Job Hours Team Total hrs
Research & Analysis Trend analysis 77h Ana Sorić Sail Media/One
of Three Stipe Splivalo Arterion
Market analysis 66h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
Case studies 80 h Ana Sorić Sail Media/One of Three
Comparative analysis 30 h Ana Sorić Sail Media/One of Three
Business info interpretation 50h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
Interpretation of goals & Business model proposal
60h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
363h Business Plan Strategic positioning of a business case
50h Ana Sorić Sail Media/One of Three
Concept elucidation 30h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
Communication strategy 45h Ana Sorić Sail Media/One of Three
2
Project diagram development 30h Ana Sorić Sail Media/One
of Three
Business plan creation & update
350h Ana Sorić Sail Media/One of Three
Business plan evaluation (first draft)
50h Hassan Jaferi; Canadian Intellectual Property Office; PARTEQ Innovations
Total hrs 555h Branding 150h Ana Sorić Sail Media/One
of Three Stipe Splivalo Arterion
150h
Front End & Information Architecture (IA)
Communities analysis 30h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
Proposal for creative concept 30h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
Proposal for technical concept 50h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
Content inventory 25h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
Graphic design concept & development
250h Stipe Splivalo Arterion
Documentation - graphic standards
50h Stipe Splivalo Arterion
User experience analysis 30h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
IA – Information architecture design
200h Ana Sorić Sail Media/One of Three Stipe Splivalo Arterion
3
Total hrs 665h Investor relations management
770h Ana Sorić Sail Media/One of Three Natko Vlahović HOK Stipe Splivalo Arterion Tomislav Ilić Reprograph
770h
Legal 50h Tomislav Šunjić Aljoša Šerić
50h
TOTAL HOURS
2553h
