BUSINESS PLAN - Amazon Web Servicesusercontent-salt.s3.amazonaws.com › smartsender › 117791343...
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B U S I N E S S P L A N
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n2 C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n2
S A M A N T H O N YPhone: (800) 548-5006Fax: (202) 478-2700 Email: [email protected]
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TA B L E O F C O N T E N T S
EXECUTIVE SUMMARY 5 Company Ownership 7 Company Location 7 Use Of Funds 8 Investor Proposition 9
YOURNEWS MEDIA GROUP: AN OVERVIEW 11 Proprietary Geo-Subject Technology & Smart TIM Technology 14 Social Information Platform 15 User Engagement 17 Mobile Application 18 Current Status 18 Exit Strategy 19
MARKET ANALYSIS SUMMARY 22 Market Segmentation 28 Vertical Markets 30 Industry Analysis 32 Competitors 32 Competitive Edge 34
STRATEGY & IMPLEMENTATION SUMMARY 36 Objectives 37 Advertiser Sales Strategy 37
MANAGEMENT SUMMARY 41 Culture & Staffing Philosophy 48
FINANCIAL PROJECTIONS 49
APPENDIX: YEAR 1 FINANCIALS BY MONTH 58
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n4 C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n4 C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n4
yourNEWS operates within the largest
area in media - the $120 Billion in
revenue Internet Publishing and
Broadcasting sector - the sector with
the least amount of innovation.
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E X E C U T I V E S U M M A RY
yourNEWS Media Group, Inc. (also referred to as “YNM” and “the Company”)
is an increasingly popular source of news and information.1 Over 20,000 of the
world’s finest journalists, citizen journalists and public contributors supply its
readers with what the Company believes to be one of the best news experiences
on the web. Averaging well over 2,000,000 monthly page views,2 yourNEWS is
excelling rapidly, and is recognized as a premier news provider.
yourNEWS allows the public to submit local news and information in several
categories and presents this information alongside local reporting from affiliate
media companies as well as top national and global stories. The goal is to
make people’s lives simpler and more productive by breaking down the walls
of complexity and irrelevancy within the news and information environment.
The Company is creating a network that will serve any local market with pre-
populated topics such as news, people, businesses, opinions, events, sports,
churches, nightlife, clubs, politics, homes, gardens, theatre, cinema, art,
architecture, food, design, and community history.
yourNEWS operates within the largest area in media - the $120 Billion in
revenue,3 $34.5 Billion in profits4 Internet Publishing, Broadcasting & Search
Portals Industry - the sector of new media industries with the least amount of
innovation. Within other categories, there have been huge innovations, notably
in technology and practices. It was just a short while ago when there was no
Facebook, Google, E Harmony, Monster, or eBay. These disruptive platforms
appeared out of nowhere and changed the way people live. The same thing
will happen within the news industry. The move from print to online will be
one of the biggest paradigm shifts of this generation. Like the move from the
telegraph to the telephone, it should create an enormous opportunity for those
1Internal server web analytics. 2Securenet Systems web analytics. From 18-month period ending August 2016, yourNEWS page views per month range was 699,528 to 4,158,545. 3First Research’s Industry Intelligence 26 September 2016 Quarterly Update 4Hoovers Internet Publishing, Broadcasting & Search Portals June 2016 Report
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who recognize it. yourNEWS is delivering the new “channel” that consumers so
desperately need to receive the news that is relevant to them – a news platform
that will not force its readers to read the news that other people want, rather it
will work the way the readers want and think. yourNEWS will put the power of
the press back into the hands of the people.
yourNEWS expects to be the world’s first geographically focused, highly
interactive network of customized content, advertising and e-commerce.
The Company’s Management team is comprised of senior-level executives
from the ecommerce, entertainment, technology and financial industries.
Management possesses a breadth of functional experience in the successful
operations of multi-million-dollar international corporations, content
creation and acquisition, Internet and broadband systems, advertising, and
strategic partnering. The Company’s executive team intends to lead the
exceptional growth that is occurring in the area of hyper-local news service,
open source content creation, distribution, and revenue development. By
utilizing their decades of combined professional expertise, as well as their
strong entrepreneurial drive and devotion to revolutionizing the online media
landscape, yourNEWS Media Group’s leaders will ensure the ongoing success
of the Company.
At yourNews, we have a mission to be the world’s most revered news service. To accomplish this, we have developed a culture that encourages our contributors and our team members, so they can provide exceptional service to our viewership.
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C o m p a n y I n c o r p o ra t i o n
yourNEWS Media Group is a C-Corporation registered in the state of Delaware.
C o m p a n y L o c a t i o n
The Company is headquartered in Henderson, Nevada, with its editorial office in Palm Beach Gardens, Florida, and its administrative support center in Portland, Oregon.
To achieve the Company’s objectives, yourNEWS Media Group has secured First Florida Securities Inc., a registered broker, as a placement agent for $5 Million in investment capital from qualified investors.
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Investor $5,000,000Total Sources $5,000,000
Personnel $600,000Mobile Advertising $250,000Digital Ad, Site Investment & Development
Mobile Application Development & IntegrationPre-Alpha $200,000Beta $50,000Closed Beta $50,000Release Candidate $10,000Release $25,000General Availability $25,000
Other $340,000Customer Relationship Management $500,000Trade Shows, Conferences & Events $200,000Social Media Community Growth & Engagement $250,000Brand Building $550,000Digital Marketing $500,000New Product Initiatives $400,000Placement Expense $550,000Bridge Loan Closing Expenses - 5% APR $97,777PBG and Henderson Marketing/Sales Departments
Rent & Utilities $25,200Admin Support $19,800Office Supplies $4,500Hardware & Software $14,400Group & Key Man Insurance, Workers Comp $14,880Payroll & Production Bonuses $110,400Web & Marketing $41,400Legal, Payroll & Accounting Services $16,600Cofffe, Water & Consumables $3,000Travel And Client Meals-Entertainment $9,000Graphic Design & Related Pos Materials $13,800Royalties Paid For Image Usage $3,300Dialer & Data $11,400Misc/Petty Cash $4,543
Working Capital $110,000Total Uses $5,000,000
Uses Of Funds
SOURCES & USESSources Of Funds
U s e O f Fu n d sThe table below outlines the sources and uses of funding:
S o u rc e s & U s e s
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I n v e s t o r P ro p o s i t i o nFirst Florida Securities, Inc., is leading the Company’s capital raise of
$5,000,000. First Florida Securities is a well-respected industry leader with
nearly 30 years’ experience. This investment will allow the Company to
escalate its business plan and to further penetrate the market with local news
editions. Additionally, yourNews will be able to drive technology that will help
bring simplicity, high availability, and scalability to its website while reducing
operational complexities, inefficiencies, and costs. Moreover, the capital will
help accelerate client acquisitions though the Company’s affiliate network.
Overall, this investment will serve to increase business capacity and will greatly
secure the Company’s growth and stability.
First Florida Securities, Inc., is a member of FINRA and SIPC and was founded
in 1987 with their principal office located in Naples, Florida. A significant
portion of the success that First Florida has enjoyed has come from its
ability to secure private placements in the range of one to 25 million dollars.
Additionally, complementing its private placement capabilities is their access
to offerings in various alternative investment categories. These offerings
stem primarily from First Florida Securities’ relationships in the region with
development companies, fund managers and private and institutional investors.
Historically they have assumed the role of lead underwriter, best efforts
underwriter and distributor. yourNEWS is honored to have them as a partner.
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“I recently partnered with yourNEWS because of their straightforward advertising program. It was wonderful to find an advertising option that lets me target my audience by zip code, region and website sections, track
traffic online, and have a rotating ad created quickly with little expense. The yourNEWS team has been super responsive to my questions and full of great suggestions to improve the effectiveness of my ad.”
-Les Lazareck, PresidentHome Energy Connection, LLC
“We have been working with yourNEWS for the past 6 months. I have been so happy with the work my representative has provided to the point we have made yourNEWS our only advertising service. Being an
Internet advertising novice I feel yourNEWS has been very helpful in explaining the process as well as expanding our client base. I would strongly recommend them to anyone looking for this service.”
-Scott Hutchins, OwnerLefties Only Golf Shop
“As a Realtor I have to market my client’s listings to move product. 90% of people that are looking for a house start their search online. Advertising my property listings on yourNEWS is a must. In addition, yourNEWS
gives me the ability to post my open houses as well. Advertising on yourNEWS is a cost effective way for me to move more properties.”
-Dave Deith, Realtor
“Our business has a specific type of customer we are looking for. Advertising on the yourNEWS platform allows us to target our ads to specific areas around people reading a specific type of content. In addition, the
back office allows us to track how many times are ad was viewed. Overall we have had a great experience advertising on yourNEWS.com”
-Carl CamperYacht Broker
“We’ve enjoyed great sales success advertising my collectible toys in the classified section of yourNEWS for the past nearly two years! I reach customers from all over the country and they look forward to each new
sale I have! The steady sales have challenged me to continue finding these old toys to sell to my yourNEWS customers. It’s a great ‘problem’ to have!”
-Mark Leinberger, PresidentLeading Edge Productions, Inc.
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yourNEWS MEDIA GROUP: AN OVERVIEW
Technology has changed the world, and print publications are certainly not
immune. From 1970 to 2006, newspapers were one of the most predictably
profitable businesses around. Before the 1970s, newspapers relied on a huge
circulation stream.5 The print industry’s decline began in the 1970s with the
advent of more choices. During the 1940s, New York City had approximately
one dozen dailies. By the 1980s, that number dropped to three.6 But cable TV
and local weeklies were nothing compared to how the PC revolution altered the
news landscape.
It has been predicted there will only be five major metro dailies left by 2025.
The Pew Research Center’s Project for Excellence in Journalism study revealed
that for every dollar gained in new digital revenue, print revenue lost seven
dollars. The Internet has changed the way news and information is delivered,
and in the process the newspaper business has been destabilized.
“Good journalism should never be taken for granted, and we are preserving and cultivating
it with our platform.” ― Sam Anthony, President, yourNEWS
5Saba, Jennifer (March 16, 2014). “Specifics on Newspapers from ‘State of News Media’ Report”. 6Alterman, Eric (March 31, 2008). “Out of Print: The Death and Life of the American Newspaper”. The New Yorker.
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The business of selling words to readers and then selling readers to
advertisers, which has sustained newspapers’ role in society for decades, is
collapsing, and this trend will continue at an accelerating rate. Print readership
had begun to fall before the recession. Slashed advertising budgets and
reduced subscriptions further negatively impacted newspapers’ business
models. Print advertising expenditure fell 28.6% in 2014, according to market
research firm IBISWorld. The dropping ad revenue, which constitutes the
largest part of revenue for newspapers and magazines, has caused periodicals
to shrink their outputs, merge and syndicate, restructure through bankruptcy
or exit the industry altogether. Consequently, now on the other side of the
recession, fewer newspapers and magazines remain in print, and the ones
that do are much shorter than before. So, while the economy has returned
to slow growth and business resources that can be used on print advertising
have returned, a dramatically lower amount of advertising space is available
for purchase and the space remains less desirable as subscriptions have not
recovered.
An outdated business model hinders print publications. A 2015 report from
the Brookings Institution shows that 80% of the total cost associated with
producing a newspaper- such as buildings, trucks, presses, ink, rent, staff, and
other related expenses - has little to do with news. Journalism, the essence of
news, accounts for only 15% or less of news costs. Over the last six years, there
has been a 40% reduction in newsroom staffs, as some of the big newspapers
struggled to reorganize and remain in business.Cost reduction has become a
constant theme. Today, 90% of newspaper revenue still comes from print, while
only 10% is derived from digital. It only costs 20% to run a digital operation
as opposed to print.7 As such, the business model requires that newspapers
move away from the huge costs associated with printing presses, real estate
and staff. In contrast, yourNews transforms its readers into content providers,
the Company offers geographic focus; a focus on people who are already in a
community. yourNews enables interaction within a local community, including
local small businesses and small e-commerce companies.
7Abandoning the News, Carnegie Reporter, Carnegie Corporation of New York” 11 January 2014.
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While newspaper readership is declining, people are still eager to consume
news. Among smartphone owners, 78% report using their device to get news
in the last week. 73% of tablet owners use their device to get news. And people
with more devices tend to enjoy following the news more. News consumers who
use more technology are more likely to report that they enjoy keeping up with
the news and are more likely to say that it’s easier to keep up with the news
today than it was five years ago.8
Due to the loss of advertising revenue, print newspapers have been forced
to cut pages and therefore limit the scope of the content, making them
unable to allow consumer input or interactive exchange. Local content has
diminished in favor of less expensive syndicated national and global news.
Ad models are breaking due to a lack of local capability and focus. During
the past decade, the newspaper industry experienced significant erosion of
revenues, predominantly in print advertising. Per the Newspaper Association
of America (as reported by the Pew Research Center), is that print ad
revenues have fallen from $54.9 Billion in 2003 to just $16.4 Billion in 2014,
representing a 70% drop. A prevalent concern in the newspaper industry is that
the online newspaper advertising is cannibalizing print advertising. Advertisers
view print and online advertising within the same newspaper as substitutes.
Effective advertising is crucial to the wellbeing of any small business, and the
digital arena is quickly becoming the most important venue for connecting
with potential customers. While print advertising revenues have fallen sharply,
digital advertising continues to grow in influence. “Traditional advertising
doesn’t have that much power anymore in a world where multi-channel
digital marketing is increasing by as much as 137%, backed by an awesome
500% increase in brands using multiple digital marketing channels,” writes
Business 2 Community. “As much as 72% of consumers are already connecting
with brands through their various digital marketing channels and activities
according to reports from Mashable. Despite the fact that consumers and
business owners alike are switching towards the digital route, many small
businesses are still slow to pick up on the trend.”
8Wellman, Barry (2014). Networked: The New Social Operating System. MIT.
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Market research firm IBISWorld notes the radio broadcasting industry faces
increasing competition from online streaming radio, podcasts, and other new
media formats. As a result, many local radio businesses currently struggle to
capture a share of advertising revenues. IBISWorld also notes, “unlike national
operators, local companies are less likely to find comparable alternatives to
reaching a local audience because it is more difficult to target the majority of
residents within a specific town on the Internet versus on a local radio station
that residents listen to regularly. A focus on local events may give broadcasters
an advantage with advertisement pricing, as local advertising often comprise
the majority of a radio station’s revenue.”
P ro p r i e t a r y G e o - S u b j e c t Te c h n o l o g y a n d S m a r t T I M Te c h n o l o g y
Most purchases are made within 15 miles of one’s home. yourNEWS is
in the process of developing a proprietary, database-driven, geo-subject
information management system that enables almost effortless scalability -
this is much different from traditional information management and search
engine technologies currently in use on the web. Most search engines simply
aggregate web sites linked to a central source. They can be conceptualized as
a single-level, horizontal search methodology, where the results are direct links
appearing in response to a subject or keyword search. yourNEWS’ hyper-local
geo-subject model, however, through the use of proprietary algorithms, will
enhance advertising capability by enabling the targeting of defined geographic
areas and subjects.
Within each geographic area, subject matter is arranged in an outline format
that moves logically from general to progressively more specific topics. When a
first-time user comes to the site, they enter their zip code, which prompts the
loading of the local edition and plants a cookie in their computer, identifying
this as their Hometown Edition. Users will always be taken directly to their
Hometown Edition, but users can change their location or browse yourNEWS
for any community at any time.
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Customization continues with the Company’s Smart TIM (Target, Identify, and
Match) software, which is intended to accurately predict a user’s selection
of content. By anticipating selections and interests, Smart TIM will rapidly
identify useful content and successfully discover important, relevant news
for each user. Smart TIM uses machine-learning principles to become more
knowledgeable with every user input, accelerating its accuracy as every
individual preference for information is confirmed. Smart TIM will aggregate
the contents of 70,000 local editions of online newspapers in the Company’s
database. Material will be repurposed to create separate and distinct
yourNEWS Media Hometown Editions. Every Hometown Edition features the
same web template, specifically with personalized content offerings for every
community and user. The universal formatting for all Hometown Editions will
promote brand awareness and continuity throughout the YNM network.
Within a geographic area, subject matter is arranged in an outline format that
moves logically from general to progressively more specific topics, allowing
advertisers to localize their advertising and maximize campaign effectiveness.
All editions will be served from one platform, thereby providing rapid scalability.
Smart TIM is currently in software design and development stages, with alpha
testing expected in the first quarter of 2017.
S o c i a l I n fo r m a t i o n P l a t fo r m
The yourNEWS Social Information Platform (SIP) provides a high degree
of accuracy and relevance within a generally editable information system.
The system will be statistically more effective than the traditional closed
source systems employed today with a small number of contributors and/or
journalists. The platform distinguishes between reporting and reaction pieces,
as well as national and local news. News is sorted and transmitted to the
appropriate local affiliates or broadcast stations.
yourNEWS Media’s platform is able to publish an article to one particular city,
or to many cities, even nationwide. Content will come in and be published in
four distinct ways: The Wire Feed; User-Generated Content; Local News Room
Generated Content; and Other Subject Related News Websites.
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yourNEWS Media Content
The Company’s success will hinge greatly on its ability to maintain a steady
stream of free-flowing distinctive local information and news. To ensure a
consistent source of content, yourNEWS has developed four inter-reliant
information streams and one broad based traditional news source that unite in
YNM’s seamless news platform.
» The Wire Service. Thorough a partnership with the Reuters, noteworthy
national, regional, and local news is repurposed by Smart TIM™ and then
distributed to all Hometown Editions™. This allows for many important
stories to have in-depth coverage. This information serves as a launching
pad for discussion and commentary by users, who then “drill down”
for more local relevance. The association with Reuters and other wire
services fulfills the Company’s desire to offer all news available from all
the other news outlets. This content is mainly balancing and umbrellas the
Company’s offerings of proprietary content.
» User Generated Content: yourNEWS attracts citizen journalists from
important community institutions, groups, and businesses.
» Local News Room Generated Content: The Company will use the writing
from the local news departments of the affiliates to cover all local hard
news, such as the bank robberies. The Company’s news director will review
all local submissions within their territory, screening them for quality and
objectionable content. If the submission is approved, the news director will
direct the article to the geography of relevance. Affiliates will provide all
hard-hitting, local news.
» Other Subject Related News Websites. yourNEWS has established
relationships with numerous independent media organizations across the
country. The Company will utilize these cross-promotional relationships to
republish content, either through direct permission or via fair use practices.
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To make the news submission process as simple as possible, all content
is contributed through yourNEWS Corporate. YNM distinguishes between
reporting and reaction pieces as well as national and local news. News is
sorted and transmitted to the appropriate licenses for local editions. The
Company has developed a system for verifying sources and information and
determining the credibility of a source.
U s e r E n g a g e m e n t
Users are able to engage with content through both the yourNEWS Media
online platform, as well as the mobile app. The relevant, customized content
offers readers a chance to not only comment, but serve as everyday journalists
through the site’s submission system. Additionally, yourNEWS Media will be
able to follow/subscribe to individual journalists, as well as rate them on a
five-star system. All journalists content will be rated by users based on the
credibility, accuracy, and journalist’s overall reputation. In addition to the
comment section, there will be a place to critique journalists, where other
verified journalists will be able to challenge the contents by providing alternate
sources and evidence.
YNM will enable voices from all sides of an issue to be heard. While traditional
media outlets must limit the scope of their content, yourNEWS Media will be
able to not only run more stories, but also offer appreciable user input and an
interactive format.
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M o b i l e A p p l i c a t i o n
In addition to its online platform, the Company will offer an interactive mobile
application. Through the app, users can connect directly to their Hometown
Edition, as well as engage in all the same interactive features found online,
including liking and disliking content, critiquing, and commenting.
C u r re n t S t a t u s
To date, YNM has engaged a network of affiliates in two major test markets. The
yourNEWS platform is currently being used to upload local content and onboard
local advertisers in markets across the country. Data from the statistics and
analytics website Alexa on June 1, 2016, reveals that traffic to yourNEWS.com
is ranked within the top 1% of all active websites in the world, and that visitors
spend an average of 18 minutes on the site per visit, viewing 14 pages on
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average per day; and it has maintained a bounce rate under 5%. A bounce rate
is the percentage of sessions in which the user left a website from the entrance
page without interacting with the page. The lower the percentage, the more
“stickiness” a website has. As further data from Alexa discloses, as of June
1, 2016, yourNEWS.com had outperformed most other major news sources in
terms of pages per view, direct visits, and time spent on the sites.
The next step in the expansion of the Company’s presence will be to identify
new local “incubator” markets, to be selected on the measure of their
representativeness of markets around the country. Initial integration and
relevance testing in these incubator markets suggests that YNM’s experience
with its test markets can be successfully carried over into new markets. The
Company has observed a high degree of consistency across markets with
respect to local consumer preferences. Now poised to expand quickly into
more markets, the Company believes it has the first-mover advantage as an
aggregator of news and features for hyperlocal news sites.
E x i t S t ra t e g y
Wall Street values Facebook users at $168 per user, LinkedIn at $64, and
Twitter at $55, with an average of $96 per user.9 With a discount of 25% in
consideration of its status as a non-public entity and 50% because it is a new
enterprise, youNEWs values itself at $24/user. Currently, the company has
affiliates in two major test markets. When the Company reaches 200 affiliates,
it will engage 43,000 local audiences, engage 35 Million readers, and have an
attributed value of $860 Million.
yourNEWS Media Group anticipates exiting the business at an opportune
moment through either a merger and acquisition scenario or by offering
ownership shares on the public market. The Company will welcome a suitable
merger and acquisition scenario whereby it is acquired by a larger media or
9Forbes.com “A Comparitve Look at the Valuation of Facebook, Twitter, and LinkedIn” October 2015http://www.forbes.com/sites/greatspeculations/2015/10/01/a-comparative-look-at-the-valuation-of-facebook-twitter-and-linkedin
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technology company capable of funding its continued expansion or lending
existing support structures to the Company’s operation while properly valuing
future applications of the yourNEWS platform and model. Similarly, the
Company may instead undergo a merger that facilitates its increased market
penetration through service diversification, expanded geographic reach, and
increased contacts and resources. yourNEWS Media Group will also not rule
out the Initial Public Offering (IPO) route, nor will it foreclose the possibility of
choosing to remain “as-is,” i.e., privately funded and operated. The ultimate
decision will depend upon market forces and the wishes of both the founders
and key stakeholders.
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“I would like to take this opportunity to voice my opinion on yourNEWS Media. I am impressed with the effective way this organization conducts business. They are fast, accurate, and have the willingness to work
with you in an effort of getting you exposure for your story. In the short time our organization has been a media partner with yourNEWS we have nothing but praise and know that we have a very exciting future together.”
-Steve Sanson, President Veterans in Politics International
“Uploading text and photos is as easy as 1-2-3, and I believe the timeline from submitting to release is unprecedented. The quality, content and layout is top shelf, and navigating through the site is very user-
friendly. If I have questions or any problems, they are always quick to respond and they are keen on follow-up. I highly recommend yourNEWS.com to all writers who want to be presented professionally!”
-Larry S. Buford
“yourNEWS has proven to be a very valuable and affordable connection to the community. We know our advertisement is working because potential clients frequently mention where they saw the ad.”
-Thomas SchmittAttorney
“I own a small IT Consulting Company in the Chicago-land area. I had given up entirely on any type of print advertising since we had no way to focus on a demographic. I was spending a lot of money reaching the
wrong customers. Partnering with yourNEWS allowed me to focus on a specific geographic area. This form of marketing produced far greater results than I ever received from traditional print advertising. I would
recommend yourNEWS to any business looking for a marketing edge.”-Robert Urbinati, Owner
Precision Repair, Inc.
“I have been associated with Your News from the beginning as a READER and Advertiser. Placing ads and blog updates are easy to set up. Their staff is friendly and supportive, I like the mission of yourNEWS. The company
is really onto something … and I hope to be a long term advertiser and reader.”-Kevin Todd, President, Founder
Merchant Match
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C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n2 2
MARKET ANALYSIS SUMMARY
The Fall of the Traditional Newspaper Industry
Technology has changed the world, and print publications are certainly not
immune. From 1970 to 2006, newspapers were one of the most predictably
profitable businesses on the planet. The Internet has generated a paradigm
shift in the way news and information are delivered, and in the process the
newspaper business has been seriously undermined. Traditional print news
circulation had been falling for decades, but the Internet has hastened this
decline. The following chart, created from data provided by the Pew Research
Center, shows the steady decrease in circulation figures since 1990:10
“I like reading today’s newspaper. It tells me everything that happened yesterday.”
― Jarod Kintz, Author and Satirist
“The newspaper is dying. Our immediate society needs a better way to acquire up-to-the-minute information - than on
a paper printed at least 12 hours afore.” ― Sumner Redstone,
American Businessman and Media Magnate
“Mainstream newspapers are on a death watch.” ― Paul Gillin, Media Information Expert
10Pew Research Center. “Newspapers: Circulation by Publication Type.” Source: http://www.journal-ism.org/media-indicators/newspaper-circulation/
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The business of selling words to readers and selling readers to advertisers,
which has sustained newspapers’ role in society for decades, is falling apart,
and this trend will continue at an accelerating rate. Print readership had
begun to fall before the recession. Slashed advertising budgets and reduced
subscriptions further negatively impacted newspapers’ business models.
“The falling subscription numbers made print media an even less attractive
advertising option for businesses. As a result, print advertising expenditure
fell 18.6% in 2009,” writes market research firm IBISWorld. “The plummeting
ad revenue, which constitutes the lion’s share of revenue for newspapers and
magazines, caused periodicals to shrink their outputs, merge and syndicate,
restructure through bankruptcy or exit the industry altogether.”11
The faulty business model that hinders print publications; 80% of the total
cost associated with producing a newspaper has nothing to do with the news.
Rather, they’re paying for buildings, trucks, presses, ink, rent, staff, and other
related expenses. When these items are stripped away, the cost of journalism
isn’t all that high. yourNEWS has a clear advantage.
11IBISWorld. Source: www.ibisworld.com
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News Consumption
While newspaper readership is declining, people are still eager to consume
news. “Three-quarters of Americans get news every day, including 6 out
of 10 adults under age 30,” reports the American Press Institute. “Among
smartphone owners, 78% report using their device to get news in the last
week. 73% of tablet owners use their device to get news. And people with more
devices tend to enjoy following the news more. News consumers who use more
technology are more likely to report that they enjoy keeping up with the news
and are more likely to say that it’s easier to keep up with the news today than it
was five years ago.”12
The following chart from the American Press Institute shows Americans’ use of
various media types to consume news content; note that many people use more
than one type of media.13
12 American Press Institute. “The Personal News Cycle: How Americans choose to get their news.” March 17, 2014. Source: http://www.americanpressinstitute.org/publications/reports/survey-re-search/personal-news-cycle/13Ibid.
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There is still a clear demand for local news among Americans. Survey data
reveals that people are most likely to turn to newspaper sources (whether
print or online) for “news about their local town or city, for news about arts and
culture, and for news about schools and education.”14
14American Press Institute. “The Personal News Cycle: How Americans choose to get their news.” March 17, 2014. Source: http://www.americanpressinstitute.org/publications/reports/survey-re-search/personal-news-cycle/
Advertising Spend
While readers are still seeking out news – news is also finding them. Today’s digitally
connected consumers are likely to encounter news online through social media sites, such
as Twitter and Facebook. As more consumers rely on these digital sources to find news,
advertisers are spending more money online as opposed to funding traditional media. The
following chart underscores this shift – while digital advertising now accounts for 33% of
global advertising spend, newspapers account for just 9%.
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“Traditional advertising doesn’t have that much power anymore in a world
where multi-channel digital marketing is increasing by as much as 137%,
backed by an awesome 500% increase in brands using multiple digital
marketing channels,” writes Business 2 Community. “As much as 72% of
consumers are already connecting with brands through their various digital
marketing channels and activities per reports from Mashable. Even though
consumers and business owners alike are switching towards the digital route,
many small businesses are still slow to pick up on the trend.”15 The following
charts from BrightLocal provide an overview of SMB marketing budgets and the
current low rates of spending on Internet and mobile marketing among small
businesses:16
15Business 2 Community. “Top 10 benefits of Digital Marketing for Small Business.” March 3, 2015. Source: http://www.business2community.com/infographics/top-10-benefits-digital-marketing-small-business-infographic-0117421116Search Engine Land. “75% of SMBs say internet marketing is effective.” January 12, 2015. Source: http://searchengineland.com/75-small-medium-sized-businesses-smbs-say-internet-marketing-effective-212277
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M a r k e t S e g m e n t a t i o n
The Company will continue to work to create a network of affiliates across the
country, which will in turn aid the Company in bringing yourNEWS to a local
audience. Affiliate partners will be primarily composed of established broadcast
media outlets. In each market, yourNEWS will attempt to form one or more
relationships with television stations, radio stations, and/or print publications
that will help drive yourNEWS into their communities, thus securing mutually
advantageous relationships.
Market research firm IBISWorld notes the radio broadcasting industry faces
increasing competition from online streaming radio, podcasts, and other
“There’s still great journalism out there, but there must be more efficiency to keep it going. Wasteful practices, like
printing and delivering physical copies won’t allow money to flow in the door.”
― Belinda Peterson, Social media/Content strategist, Business Expert
yourNEWS will offer small and mid-sized local businesses an affordable,
effective means of boosting their online presence, connecting with today’s
digital-focused consumers, and reaping the many benefits of promoting their
products and services online. Results across three ad campaigns conducted
by the Company show that consumers are twice as likely to interact with
a yourNEWS ad as a standard mobile ad and have higher brand lift after
interacting with a yourNEWS ad (83% more likely to have an improved
impression of the brand, 74% to recall the brand, 22% to recall the message,
and 12% to recommend the brand).
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new media formats. Thus, many local radio businesses currently struggle to
capture a share of advertising revenues. IBISWorld also notes, “unlike national
operators, local companies are less likely to find comparable alternatives to
reaching a local audience because it is more difficult to target most residents
within a specific town on the Internet versus on a local radio station that
residents listen to regularly. A focus on local events may give broadcasters an
advantage with advertisement pricing, as local advertising often comprises the
majority of a radio station’s revenue.”17 The yourNEWS model directly supports
this advantage, and provides local radio stations with an additional revenue
stream and new ways to connect with listeners, thus strengthening their role
in the community. It also allows radio stations to attract advertisers who would
never otherwise buy a radio ad due to cost and market reach.
IBISWorld reports there are 6,673 radio-broadcasting establishments operating
in the United States in 2015 and they expect this number to grow to 6,703 in
2016. “Because of the nature of the Radio Broadcasting industry, broadcasters
are more likely to locate their facilities near densely populated areas that have
a large pool of potential listeners,” IBISWorld writes. “The states with the most
industry establishments are California (9.5%), Texas (6.5%), Florida (5.6%) and
New York (5.1%).”18
In complement to our Affiliate model, the Company believes another way to
launch yourNEWS into new markets is to negotiate a deeply discounted radio
ad buy of their “Remnant Inventory”. Remnant inventory is ad space available
throughout the day that nobody has purchased. The typical rate for this is .10
cents on the dollar. The Company will assure the station a specific monthly
dollar amount for radio commercials that have been created in house that
can be used generically in any market. As part of the program, they will be
the exclusive affiliate for one year and must provide the local news by either
posting directly to the site or through RSS feeds. After the contract is up, the
Company can move to another affiliate in that market, continue with the current
affiliate, or renegotiate on even better terms. Of course, the more popular they
make yourNEWS in that market the less leverage they have come year two.
17IBISWorld. Source: www.ibisworld.com 18Ibid.
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Ve r t i c a l M a r k e t s
“Verticals” is the colloquial short hand for “vertical markets.” It’s a business
model whereby publishers take their present content and expertise and
leverage it to establish new revenue streams, typically by catering to a specific
community around a particular topic. In the case of yourNEWS, the Company
has developed a multitude of “verticals” or “communities” around diverse
topics ranging from writing, fine art, genealogy, horse racing, boxing, golf,
home & garden, food & wine, etc. At the end of 2017, the Company predicts
that it may acquire up to 20 different verticals, with revenues of $3 million.
“The age-old publishing model of creating a product and then hoping it sells no longer is effective. The upside of verticals is
that it gives us the opportunity to build relationships with those communities we’re selling to. We learn from them and then
construct a product that is interesting.” ― Brian Arnold,
Executive Marketing Director
“If you know what you want, then going to Amazon to buy it makes sense. But if you don’t, and most people don’t, you need to be able to offer people a selection. People expect to have their individual
needs catered to. That is what we offer at yourNEWS.com.” ― Joseph Coles, Jr.,
Vice President, Business Development
The advantage to yourNEWS developing verticals is multifarious and has the
potential to offer higher margins, increased customer loyalty and, perhaps of
most importance, the ability to control its own fortune.
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“We work collaboratively with our customers and we understand that it is our consumer’s choice. We want to be everywhere our
subscribers are — if they are on a horse racing site or fine art site, we want to be there too. This is what pushes sell-through.”
― Sam Anthony,President and Founder
Ultimately, verticals are about becoming synonymous with a given subject in
the same way that Amazon has become synonymous with online shopping. The
development of yourNEWS’ own verticals doesn’t preclude the Company from
still working within its current news distribution model; instead it offers new
opportunities for collaboration.
To ensure that each community has a chance at success, yourNEWS has
created a dedicated e-marketing team focused on digital first.
yourNEWS’ strategy is to become the Amazon of news – a place where it can
lead subscribers by the hand and become community leaders. The key is to give
them a great experience online, maintain credibility and offer them through its
advertisers a good quality product or service at the right price.
For yourNEWS the vertical model of operating has greater long-term potential
for growth than does the traditional horizontal approach.
Verticals in the publishing industry like Soccer News, Political News, Home
& Garden News will be rolled up and brought under the Company’s umbrella.
As individual websites, these verticals are limited in the revenue they can
generate. yourNEWS gives them scale and the ability to generate significantly
more revenue in that particular vertical because of the amount of inventory
the Company has. yourNEWS is an information aggregator on a national scale,
utilizing both national journalistic resources and citizen journalism. The goal is
to bring all of the country’s information under the YNM’s umbrella and create a
uniform media.
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I n d u s t r y A n a l y s i s
yourNEWS operates within the $120 Billion in revenue,19 $34.5 Billion in
profits20 Internet Publishing, Broadcasting & Search Portals Industry This
advertising revenue-driven industry is enjoying a period of sustained growth,
with a 5.6% annual increase in revenue, on average, expected annually through
2020. “This expected growth is largely a result of the influx of mobile Internet
connections expected to come into existence in the United States over the
five-year period,” IBISWorld writes. “Advertisers are expected to continue
aggressively targeting Internet users through social media and other content
sites and applications. The Internet content publishers that will most benefit
from this increased advertising expenditure are the industry’s well-established
major players and smaller players that develop specialized mobile applications
or publish original content that pertains to a niche market.”21 By 2020, industry
revenues are expected to reach $51.7 Billion.
C o m p e t i t o r s
The unique and innovative nature of the yourNEWS model means that the
Company operates without direct competition from any existing business
or media organization. yourNEWS has worked to aggressively build the key
relationships, industry knowledge and online corporate infrastructure required to
execute its innovative strategy. This synergistic operating model gives yourNEWS
significant competitive advantages in the market place. The Company will
capitalize on these advantages as it develops an answer to a presently unmet
market need, thereby earning a reputation as the leading provider of local news
coverage and advertising opportunities. The Company has carefully analyzed
the strengths and weaknesses of its competitors, and will utilize the following
analysis of these businesses’ successes and shortcomings as a roadmap as it
finalizes its own marketing and operational plans.
19First Research’s Industry Intelligence 26 September 2016 Quarterly Update 20Hoovers Internet Publishing, Broadcasting & Search Portals June 2016 Report 21Ibid.
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Hometown News | www.hometownnews.com
The Hometown News site offers a searchable list of all online newspapers by
state, but does not offer any additional services, advertising, or content. Users
seeking local news in an unfamiliar part of the country may see Hometown
News as a valuable resource, but it has little utility for most other consumers,
and does not solve any of the readership or advertising issues tackled head-on
by yourNEWS.
Examiner.com | www.examiner.com
The Examiner network of websites offers local news and content contributed
by citizen bloggers on a broad range of topics. Examiner.com experienced
extremely rapid growth in 2008 and 2009, and presently adds a reported 3,000
pieces of content each day. While Examiner.com has attempted to work as a
network of local news sites, its reputation for sensationalized headlines driven
by its pay-per-page view contribution policies has damaged the site’s reputation
as a news source.
Patch.com | www.patch.com
Patch offers local and hyperlocal news for communities in 23 U.S. states,
operating more than 900 news websites. The company was launched in 2007,
and acquired by AOL in 2009. Patch utilizes local reporters to contribute news
and human-interest stories, and its business model has been the subject
of intense scrutiny. AOL sold Patch to Hale Global in 2014, and the company
reported its first-ever profitable quarter shortly thereafter. However, Patch’s
high overhead means that this competitor’s business model is untenable in the
long-term.
Yahoo News, Google News, and other portals
The two major online aggregators of content provided by other organizations
and websites. These companies offer news, and some even have local news.
However, no industry player can offer true local stories submitted by local
reporters combined with local ads. In contrast, with the approach of Yahoo! or
America Online, the advertiser buys advertising impressions, but is given no
assurance that the advertiser’s message will reach its targeted geographic
audience. yourNEWS Media Group’s ability to anticipate the future of news
delivery gives it a significant advantage over its competition.
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C o m p e t i t i v e E d g e
As it enters the next stage of development, yourNEWS will continue to capture
market share by capitalizing on its many competitive advantages, which include:
» Hyper-local self-service news and ad platform combined with a licensing
model to enable mass distribution
» Self-service platform enables editors and writers to upload content and
local advertisers to place their own ads
» Distributed via an affordable and cost-effective licensing program
» Massive scalability
» Local affiliate knowledge and control
» National and global content
» Online platform offers low overhead and marginal cost structure
» In-depth training program for top affiliate production
» Patent-pending platform to protect key intellectual property
» Utilizing a paid contributor model to ensure the creation of high-quality content
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“As the office manager/part owner of a dental office, I decided that the best use of our advertising dollar was to enhance and make our online presence more effective. Our website was developed and I hired an
SEO company. However, their work was not that valuable to me. Then, through a friend, I became aware of yourNEWS and I have been extremely pleased. Within the past year, yourNEWS has increased my new patient
flow to our tall monthly goal! I highly recommend their services!”- Beatrice Linn
David G Linn, D.D.S., P.C
“Being in the investment business I want to market my services to high net worth individuals. I’ve tried advertising in expensive magazines, newspaper, & val pak type products. All of them cost a lot of money and
there is no way to measure results. Advertising with yourNEWS allows me to target my ads to specific high net worth zip codes eliminating the waste. With the reporting in my back office I can see exactly how many times
my ad was seen. I’m a believer.”-Sean Quinn
Morgan Stanley
“I have been affiliated with yourNEWS the last few years. I think it is a unique concept in sharing news with their local communities. They have done an excellent job in placing our ads on their website and I am very
happy with the results.”-Steve Coy
General Manager 76 Golf World
“We have been clients of yourNEWS for just over a year. We have been delighted with the results that we have received and appreciate the internet dashboard to view our internet progress. Their efforts have been
so successful that we were able to drop the services of other advertisers, what turned out to be unnecessary providers. We give their team our highest recommendations.”
-Martin R. Melic, DDS, FIAPA, DICOILaurel Waters Cosmetic Dentistry
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“I have been advertising on yourNEWS.com for nearly 2 years with great results. As a municipal golf course we have a very limited budget. Print advertising is very expensive. yourNEWS advertising allows us to advertise
on the Golf page specifically targeting our primary audience and we have the ability to set our own budget. I would recommend yourNEWS advertising to any business.”
-Rick H, Club ProM.C. Golf & CC
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STRATEGY & IMPLEMENTATION SUMMARY
The Company builds its circulation by using a grassroots approach, then selling
ads into that circulation. yourNEWS has positioned itself to become the largest
household name within the newspaper business in the nation. yourNEWS will
develop a brand that communicates its core values of quality content, local
focus, and exceptional advertiser ROI. A cohesive brand identity, including a
memorable logo and all necessary marketing collateral, will transmit a clear
message of these values to the Company’s readers, contributors, affiliate
partners, and advertisers and guide the development of marketing campaigns.
“10 years down the line, almost all people will be accessing information digitally. It seems that yourNEWS might have a
leg or two up on competition.” ― John Merrimack
Business Management Consultant, McKinsey & Company
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O b j e c t i v e sThe Company has identified the following objectives and benchmarks for its next growth stage:
Short-term » Utilize funding to scale the business and rapidly deploy the platform across new markets
» Establish itself as the nation’s most trusted source of local news » Create a culture of contributors in communities nationwide » Build a base of readers and advertisers that is large enough to sustain business
Long-term » Enhance its client base to sustain the business and support its growth objectives
» Generate enough revenue to expand operations » Exit the Company through acquisition by a major Internet or media firm
A d v e r t i s e r S a l e s S t ra t e g yThe yourNEWS sales team will use a direct sales approach and a variety of
advertising channels to increase its exposure among prospective advertisers.
Specific channels will include:
Direct sales: In the business-to-business world, direct advertising has always
been the most effective means of reaching new customers. For this reason,
yourNEWS will use direct sales calls, presentations, and appointments with
potential advertisers throughout the United States. The Company will also
arrange conference calls and webinar presentations with faraway prospects
when geography is a limiting factor. The benefits of a direct sales approach
include lower upfront marketing costs, enhanced lead generation, and
immediate results. YNM will leverage the some of the broadcast inventory for
lead generation for sales people.
Networking: As with any relationship-based business, the Company will benefit
from participating in several networking opportunities that have the potential
to yield new business contacts as well as nourish existing ones. yourNEWS
will attend a variety of events that draw substantial numbers of prospective
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n3 8
clients, including seminars, networking events, and conferences, which provide
opportunities to speak to and associate with larger audiences.
Email marketing: Current and prospective clients will benefit from receiving
strategic email updates and newsletters on a regular basis. This will provide the
Company’s database of clients and opt-in members with information regarding
promotional specials, upcoming events, and relevant business news. All emails
will be optimized for desktop and mobile viewing. Email marketing delivers the
highest ROI of any digital marketing tactic: an average of $44 per dollar spent.22
Referral marketing: Perhaps more effective than any other marketing tool,
referrals will become an essential component in expanding brand recognition.
Current clients will highlight the Company’s proven expertise and customer
service abilities to their own personal and professional contacts. This will
generate priceless leads as well as a strong base of prospective new clients.
According to research conducted by Nielsen, word of mouth remains among the
most influential forms of advertising, with 84% of consumers stating that they
trust earned media, such as word of mouth recommendations from friends and
family, above all other forms of advertising.23
National Advertising Agencies: The Company will hire a reputable advertising
to promote its website and services. This will include creating a press kit and
the design of other promotional materials, as well as managing the Company’s
overall marketing and branding.
Self-Service Advertising Platforms: yourNews will place its business
information in online directories such as Google My Business. This effort will
help generate interest in the Company from the online community and public.
yourNews may also initiate contact with Groupon and LivingSocial to design
promotions for interested consumers looking for affordable deals online.
Flyers: The Company has created compelling advertising collateral that will help
to attract advertisers and contributors. These advertisements will highlight the
benefits of the Company’s services and will provide its contact information. A
sample flyer is shown on the following page:
22Pick, Tom. “104 fascinating social media and marketing statistics for 2014 (and 2015).” B2C. 2014. Source: http://www.business2community.com/social-media/104-fascinating-social-media-marketing-statistics-2014-2015-0108493523Nielsen. “Under the Influence: Consumer Trust in Advertising.” September 17, 2013. Source: http://www.nielsen.com/us/en/insights/news/2013/under-the-influence-consumer-trust-in-advertising.html
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“I have owned, managed and worked in numerous businesses during the last fifty years. I was involved in and or responsible for advertising, marketing and promotion. I was always quick to identify the right media
fit and where to spend my budget until I started Results Fitness. After spending thousands of dollars and receiving paltry returns on my investment I swore off any future advertising. I was approached by yourNEWS
and out of courtesy agreed to listen to a presentation. I was impressed by the uniqueness of the program. The ability to zero in on my zip codes eliminates paying for areas that are too far to attract members to my
gym. yourNEWS flexibility placing ads in the sections that would appeal to my potential market, a hologram type ad, and pay per view turned a reluctant skeptic into a believer. Thank You for a successful campaign.”
- Louis DiVitaOwner, Results Fitness
“I own an event promotion company. Our job is to put on events and promote them to bring people to the event. yourNEWS is fantastic for doing this. Not only can we run display ads in a specific market which
links directly to the page on the site we want seen but we can also publish the event with photos as well. yourNEWS is a great place for promoting events. If you are looking to promote your event I would highly
recommend yourNEWS.com.”-Rick Bacchus
Bacchus Companies LLC
“I’m in the Anti-Aging business. The biggest cost of my business is getting new customers. Traditional advertising is extremely costly and national advertising is out of the question. Advertising on yourNEWS has allowed us to expand our reach nationally for a fraction of the cost of what any traditional media would. Our
website traffic has risen significantly since we started advertising with them. Thanks for bringing me this amazing advertising product.”
-Bryan TullyPhysicians Rejuvenation
“I have a limited advertising budget and a specific customer that I’m trying to reach. yourNEWS gives me the ability to set my own budget, target my ad to specific zip codes, and advertise around the content that would
be most relevant to my target audience. I would recommend yourNEWS to any business owner. Targeted advertising is the only way to go.”
-Clay V.Premier Mortgage
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M A N A G E M E N T S U M M A RY
Sam Anthony, President
Sam had been in the news gathering business for over 14 years when he
came up with the idea for an online local digital newspaper. At the time of its
inception, Sam was leading Out2.com, a startup he had to launch to pioneer
Internet advertising sales, employing 20 programming and ad sales team
members. It was during his time as a securities broker that Sam began his
experience in the news gathering business through conducting in-depth
research and evaluating numerous situations. At the age of 21, Sam left college
to begin his first of many professional successes delivering personalized
brokerage services to key clients with B. Robinson & Company. He went on
working as a retail broker with Lehman Brothers in Downtown Chicago, the
boutique firm Comprehensive Capital, where he gained experience in selling
private and public investment, and Joseph Charles & Assoc., Inc.
Chris DeRario , Chief Business Officer
Chris brings 25 years of leadership experience in media and broadcasting to
yourNEWS. He is known by many throughout the industry and has an excellent
reputation. He is a seasoned presenter at media events both on the national
and state level and has participated on many discussion panels. Chris has
substantial abilities in marketing, brand building, cable television, national
advertising, new product initiatives, management of marketing and sales
teams, broadband, broadcast, newspaper and advertising industries, and
working with the financial investment community. While Director and Chief
Marketing Officer at Comcast Corporation, Chris was charged with building out
regional sales operations. He was also involved in researching and managing
business development, launching new products, and strategic project planning.
The YNM management team is comprised of experienced professionals
with extensive experience in media and mobile technology research and
development. Key team Members include:
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n4 2
Previously he was Chief Operations Officer for France Télécom, now Orange
(NYSE ORAN), a multinational telecommunications corporation with revenue
of $50 Billion and a customer base of over 260 Million. Chris has also worked
as a VP for Warwick Communications, Director of Marketing for Dow Jones
Newspaper Group, Marketing and Sales Director for Time Warner Cable,
Director of Operations for Cablevision Systems Corporation, and a Director of
IT and Marketing Director of Westinghouse Broadcasting. Chris has a BS in
Marketing from Purdue University, West Lafayette, Indiana.
James Chamberlin, Jr. , Chief Financial Officer
James has brought his guidance and expertise to many organizations over the
last 24 years. He has been a founder and officer in both private and public
companies across financial industries and real estate development. Previously,
James was the Senior VP of Sales and Operations at SBI, where he drove all
facets of operations, sales, organizational development, strategic planning, and
process improvement. His is known for playing a central role in growing SBI
650% in 25 months to over $300 Million in revenue. Soon after he positioned it
for sale to a publicly traded Fortune 1000 Company. Additionally, James served
as the Chief Financial Officer at Continental Properties Real Estate Brokerage,
where he restructured the company to successfully navigate it out of a
distressed situation. Continental Properties employed as many as 2,000 agents.
James is a former registered representative with Merrill Lynch and serves on
the board of directors of three companies. James holds a Bachelor’s degree in
Business Management and Marketing from the University of South Carolina, a
degree from Columbia University, and is a graduate of The United States Marine
Corps Command and Staff College with studies in Military Science and National
Policy.
Dan Kern , Chief Strategic Officer
A seasoned financial and strategic business professional, Dan brings 26 years
of experience to yourNEWS. He has held roles as a hedge fund manager,
money manager, registered investor, and professional trader. Dan holds
several financial licenses, including series 7, 63, 24, and 65. As a registered
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n 4 3
representative with Lehman Brothers, Dan worked to attract outside capital
and manage client funds. He then managed an independent branch and traded
company capital for Paulson Investment Company and Schneider Securities
for a total of 12 years. Prior to his financial experience, Dan was with National
Computer Systems and Control Data Corporation. He was responsible
for quality control and various technological developments. Dan’s unique
knowledge, experience, and insight of technology mixed with a long financial
history allows for a broad understanding of today’s tech-driven companies.
As Chief Executive Officer and founder of EquityHunter, an online private
placement company, he applied his special expertise in financial, strategic,
and operational management. Currently, Dan is on the foundation board and
finance committee for Dakota State University. He is President and Founder of
Kern Asset Management, the general partner of a hedge fund. He received his
degree from the Minnesota School of Business.
Dr. Sangthen Chirdchid (“Dr. Sang”) , Director, Mobile Platform and Application
Development
Prior to joining yourNEWS, Dr. Sang was the Director of Development for
OpenPeak, one of the largest mobile technology incubators in the country, run
by John Sculley, the former CEO of Apple and Pepsi-Cola. Dr. Sang is an expert
in mobile design and development. While at OpenPeak, Dr. Sang led his teams
to create comprehensive software platforms that provided the highest levels
of government, enterprise and education data security when implemented on
personal mobile devices, company-liable devices, applications, and even voice
and data services. Dr. Sang’s mobile platforms were offered to government,
education, and enterprise customers. For nearly 15 years, Dr. Sang’s focus has
been on the design and engineering of mobile applications. He has developed,
along with his teams, some of the most advanced mobile technology available in
the market. Dr. Sang’s goal at yourNEWS is to provide powerful news solutions
that make the management of yourNEW’s applications and data easy for
direct customers, service providers, end-users and the even the development
community. Dr. Sang received his PhD in Computer Science from Florida
International University.
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n4 4
Nattawut Srileeannop (“Natt”), Mobile Engineer
Natt carries his specialized toolset to yourNEWS. Natt will add gamification
(application of game design elements and game principles in non-game
contexts) to some facets of the yourNEWS mobile application. Natt has
established that his designs improve user engagement organizational
productivity, flow, learning, crowdsourcing, and ease of use and usefulness
to his mobile applications. As a Lead Software Engineer at Zynga, provider of
social video game services, his group created FarmVille, a simulation social
network game. FarmVille is available as an Adobe Flash application via the
social-networking website Facebook and Microsoft’s MSN Games. After its
launch on Facebook, FarmVille became one of the most popular games in
history, having 10 Million daily active users within six weeks. Natt has held
positions as Lead Mobile and Head of Web Connected Teams at Zynga. He has
significant expertise with UI Automation for Genie Flash (Java and Selenium)
for Web and TestNG for Unity (3D games Engine) for Mobile/Tablet devices and
proficiency on Appium, JAVA for creating/scripting Automation on Android,
Kindle and iOS devices. Natt is known for coordinating and negotiating with
production for priorities, scoping deliverables, and planning to meet tight
deadlines without compromising on quality of the mobile infrastructure.
Pablo Pera, Senior Software Engineer
Pablo has taken more than 10 mobile apps from idea to millions of users in the
market, as the lead engineer of multiple teams in various companies, including
his own. Before focusing full-time on Android apps, he worked for Google and
CERN (home of the LHC particle accelerator) as well as various tech startups in
New York. He has invaluable experience in all areas related to an Android app
from design and coding to acquisition and growth. Pablo has a Master’s degree
in Computer Science from the Polytechnical University of Valencia in Valencia,
Spain and a Master’s degree in Artificial Intelligence from KTH Royal Institute of
Technology in Stockholm, Sweden
Joseph Coles, Jr. , Director, Business Development
Joseph brings a strong vision and proven track record of building exceptional
success-driven, high energy sales teams to yourNEWS. With a keen eye
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n 4 5
for talent, he personally manages the recruiting, training and professional
development of his team members to maximize potential and increase profits.
Joseph greatly enjoys leading the sales team to achieve business and life
goals, and seeing their accomplishments rewarded. He joins yourNEWS from
Medi-Pharmaceutical, where he served successfully as the General Manager
& Sales Manager by fostering a supportive sales environment, capitalizing on
potential through collaborative efforts and building strong team players. Joseph
has over 15 years of experience in business development. His background also
includes experiences with the Global Charity Association, Treasure Coast Asset
Management, and Wealth Management and Advisory.
ADDITIONAL MANAGEMENT AND ADVISORS
The Company plans to appoint additional Directors as well as executive
management and media and marketing personnel, and to appoint highly-
qualified persons as Members of its Advisory Committee to the Board of
Directors.
David Kitzinger
Dave is a telecom professional of 30 years working with Fortune 500’s, and
Tier I, II, III Telephone Companies. His greatest assets are creative-vision and
persistence. He is well respected for his technical and industry knowledge and
his willingness to educate through shared knowledge. In his senior consulting
role with Walker and Associates, Dave advised on telecom industry trends and
strategy and served as Liaison to over sixty Tier 3 Consultant Engineering firms
in a business development capacity. Dave has further served on the Fiber-
To-The-Home (FTTH) Technology Committee and contributed to numerous
white papers. Previously, while working for Rockwell International Dave held
the highest-level “Civilian National Security” clearance and reported to the
Pentagon as he worked on national security projects such as NORAD, special
services for nuclear power plants, Strategic Air Command Air Force Base, Navy
and Coast Guard ship internal communications, and video surveillance of the
world. His expertise includes 34 technical areas of expertise including buried
cable, access, special services, IP, data, transport/light wave, switches, FTTH,
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n4 6
IPTV, microwave, and satellite, as well as supporting and designing satellite
dish farms and off-air antennas for IPTV. Dave has worked with a number of
industry leaders, such as Cambium Networks, Core Telecom Systems, Tellabs,
Advanced Fibre Communications, Westell, Rockwell International, RTEC, and
Lorraine Power. Dave is the Principal at Advisory Services, LLC.
David Noble
Dave, a registered General Securities Principal and Equity Trader within the
Financial Industry Regulatory Authority (FINRA), has worked as a Wall Street
professional for the last three decades. Respected within the industry as a
“trader’s trader,” he has effected the buys and sells of over 500 Billion dollars
in public securities for over 10,000 institutional and high net-worth clients –
as well as for other broker-dealers. He has executed millions of contracts
and has traded efficiently and profitably through all market cycles, in all the
US and most global exchanges. Mr. Noble has led the trading desks of some
of the most admired trading firms in the world, such as Celadon Financial,
Buckman Buckman & Reid, Rodman & Renshaw, and Rushmore Capital. He
is an authority on a broker-neutral platform, able to route orders based solely
on best interests and considered an expert at achieving target prices and
providing price improvement, whenever possible, all with creating minimal
market impact. Dave is fluent in a comprehensive line-up of execution services
including block trading, options, ETF trading services, fixed income, algorithms
and direct electronic access, and hedging strategies. He has made markets
in over 5000 stocks including NMS equities, NASDAQ small caps, NYSE listed
securities, and OTCBBs.
Dr. C. Jerry Nelson
Jerry received his Bachelor’s. and Master’s degrees at the University of
Minnesota, and his Ph.D. at the University of Wisconsin in 1966. After a post-
doctoral at Cornell University, he joined the University of Missouri faculty in
1967 and retired in 2006. Dr. Nelson has written 38 book chapters, edited seven
books, and published more than 225 research papers mainly on photosynthesis,
carbon metabolism and growth characteristics of pasture and forage plants.
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n 4 7
He was elected President of the Crop Science Society of America in 1988 and
the American Society of Agronomy in 1996. He led development of the series of
successful International Crop Science Congresses that began in 1992, and was
elected the first President of the International Crop Science Society in 2000.
As Professor Emeritus of Plant Science, Dr. Nelson frequently visits countries
in East Asia and Africa to give lectures, meet students and develop research
partnerships with universities and research institutes. At the University of
Missouri, he serves as Senior Advisor for the Asian Affairs Center and is
Co-Director of the Vietnam Institute. He was honored with several awards
including the Crop Science Research Award from the Crop Science Society of
America and the very prestigious Siehl Award from the University of Minnesota
for contributions to international agriculture. Jerry continues international
activities in East Asia and Africa focusing, on sustainability of agriculture, food
supplies, social justice and climate change.
Jay Hauer
Jay’s core purpose for the last 30 years has been to improve customer
performance through innovative technology. For the last decade, Jay has been
the President of Applied Engineering Services. AES provides business-to-
business services in the industry of business consultants from its main office
in Minnesota. Jay, as a seasoned business owner, knows that his employees
and the culture that he helps to create are the keys to success. He has
worked to provide the experience, training, organization and cultures to allow
careers to thrive. Previously at Novaspect, a leader in engineering services
and technologies to process industries, Jay headed up selling and servicing
industrial process controls. Formerly, Jay was responsible for in-house
and field training at the multi-billion dollar subsidiary of Emerson Electric
Company, Rosemount Engineering. Jay is passionate at creating effective
processes, he positions himself to attract the best talent, and ensure that he
delivers local services with proven technologies.
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n4 8
C u l t u re & S t a f f i n g P h i l o s o p h yEmployees are the lynchpins for the Company’s organization. yourNEWS has
created a well-defined, well communicated “signature experience” that is
conveyed to potential hires and reinforces for the workforce the attributes and
values of yourNEWS. The Company has a comprehensive understanding of the
types of people who will be productive in the organization over the long-term. The
Company targets potential employees as methodically as it targets customers;
yourNEWS shapes its signature experiences to address its business needs;
identifying the preserving its culture; creating processes consistent with its
signature experiences; and understanding that it should not try to be all things
to all people… just the people who want easily accessible, relevant, personalized,
real-time news and information.
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n 4 9
Year 1 Year 2 Year 3 Year 4 Year 5Total Revenue $1,046,793 $3,285,559 $16,464,815 $45,951,062 $91,859,464Gross Margin $889,774 $2,933,571 $15,147,630 $42,274,977 $84,510,707Operating Expenses $3,733,591 $4,420,180 $8,274,241 $12,832,818 $18,959,075EBITDA* ($2,841,151) ($1,481,942) $6,880,555 $29,450,992 $65,561,465Net Profit ($2,843,817) ($1,486,609) $5,842,560 $19,137,403 $42,608,561
Profitability RatiosGross Margin/Revenue 85% 89% 92% 92% 92%EBITDA/Revenue -271% -45% 42% 64% 71%Net Profit % -272% -45% 35% 42% 46%
Debt RatiosDebt Ratio (Total Debt/Total Assets) 8.14% 28.23% 16.36% 8.81% 6.63%Interest Coverage Ratio N/A N/A N/A N/A N/ADebt Service Coverage Ratio N/A N/A N/A N/A N/A
Days on HandReceivables 0 0 0 0 0Inventory 0 0 0 0 0Payables 30 30 30 30 30
Net Cash Flow $2,309,956 ($1,439,634) $6,822,581 $20,324,422 $44,975,089Cash Balance - Ending $2,309,956 $870,323 $7,692,904 $28,017,326 $72,992,415
FINANCIAL HIGHLIGHTS
*Earnings before interest, taxes, depreciation & amortization
FINANCIAL PROJECTIONSThe following table and graph illustrate the financial goals of the Company
during the next five years:
F i n a n c i a l H i g h l i g h t s
F i n a n c i a l H i g h l i g h t s
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n5 0
The following is a five-year revenue forecast. Direct costs include all costs
which can be directly tied to revenue and include “cost of goods.”
Re v e n u e Fo re c a s tYear 1 Year 2 Year 3 Year 4 Year 5
Revenue1,000 Impression Packages $469,263 $1,458,634 $7,293,168 $20,387,278 $40,774,5562,500 Impression Packages $352,536 $1,102,180 $5,501,148 $15,326,760 $30,632,1423,000 Impression Packages $224,994 $724,745 $3,670,499 $10,237,024 $20,452,766
Total Revenue $1,046,793 $3,285,559 $16,464,815 $45,951,062 $91,859,464
Direct Cost of RevenueHosting, Commissions, Back End Costs $157,019 $351,988 $1,317,185 $3,676,085 $7,348,757
Subtotal Cost of Revenue $157,019 $351,988 $1,317,185 $3,676,085 $7,348,757Other Direct Cost $0 $0 $0 $0 $0Total Direct Costs $157,019 $351,988 $1,317,185 $3,676,085 $7,348,757
Gross Margin $889,774 $2,933,571 $15,147,630 $42,274,977 $84,510,707Gross Margin/Revenue 85% 89% 92% 92% 92%
REVENUE FORECAST
The table below shows the units and pricing assumptions underlying the
revenue forecast:
U n i t A s s u m p t i o n sYear 1 Year 2 Year 3 Year 4 Year 5
Year End Monthly Subscribers1,000 Impression Packages 230 1,150 5,750 11,500 23,0002,500 Impression Packages 115 580 2,880 5,750 11,5003,000 Impression Packages 55 290 1,440 2,880 5,750
Units1,000 Impression Packages 2,358 7,330 36,649 102,449 204,8972,500 Impression Packages 1,179 3,686 18,398 51,260 102,4493,000 Impression Packages 564 1,816 9,199 25,657 51,260
Total Units 4,101 12,832 64,247 179,365 358,606
Unit Price1,000 Impression Packages $199.00 $199.00 $199.00 $199.00 $199.002,500 Impression Packages $299.00 $299.00 $299.00 $299.00 $299.003,000 Impression Packages $399.00 $399.00 $399.00 $399.00 $399.00
Direct Unit Cost1,000 Impression Packages $0.00 $0.00 $0.00 $0.00 $0.002,500 Impression Packages $0.00 $0.00 $0.00 $0.00 $0.003,000 Impression Packages $0.00 $0.00 $0.00 $0.00 $0.00
UNIT ASSUMPTIONS
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n 5 1
Ye a r 1 Re v e n u e M o n t h l y
A n n u a l Re v e n u e
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n5 2
Year 1 Year 2 Year 3 Year 4 Year 5Personnel Count
Founder & CEO 1 1 1 1 1Founder & Editor-in-Chief 1 1 1 1 1COO 1 1 1 1 1CFO 1 1 1 1 1Developers 1 2 3 5 6Sales & Marketing Staff 6 12 16 18 20Content Management Staff 3 6 12 16 17Admin/Other 2 4 8 10 12
Total Personnel 16 28 43 53 59
Personnel WageFounder & CEO $85,000 $89,250 $93,713 $98,398 $103,318Founder & Editor-in-Chief $85,000 $89,250 $93,713 $98,398 $103,318COO $85,000 $89,250 $93,713 $98,398 $103,318CFO $85,000 $89,250 $93,713 $98,398 $103,318Developers $65,000 $68,250 $71,663 $75,246 $79,008Sales & Marketing Staff $55,000 $57,750 $60,638 $63,669 $66,853Content Management Staff $45,000 $47,250 $49,613 $52,093 $54,698Admin/Other $40,000 $42,000 $44,100 $46,305 $48,620
Personnel CostsFounder & CEO $85,000 $89,250 $93,713 $98,398 $103,318Founder & Editor-in-Chief $85,000 $89,250 $93,713 $98,398 $103,318COO $85,000 $89,250 $93,713 $98,398 $103,318CFO $85,000 $89,250 $93,713 $98,398 $103,318Developers $65,000 $136,500 $214,988 $376,228 $474,047Sales & Marketing Staff $330,000 $693,000 $970,200 $1,146,049 $1,337,057Content Management Staff $135,000 $283,500 $595,350 $833,490 $929,862Admin/Other $80,000 $168,000 $352,800 $463,050 $583,443
Total Payroll $950,000 $1,638,000 $2,508,188 $3,212,409 $3,737,682Payroll/Revenue 90.75% 49.85% 15.23% 6.99% 4.07%
PERSONNEL FORECAST
The Company’s personnel forecast is outlined below. Personnel wages indicate the
average wage per position and personnel costs are total wages for each position.
Pe r s o n n e l Fo re c a s t
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n 5 3
Year 1 Year 2 Year 3 Year 4 Year 5Total Revenue $1,046,793 $3,285,559 $16,464,815 $45,951,062 $91,859,464Total Direct Cost of Revenue $157,019 $351,988 $1,317,185 $3,676,085 $7,348,757Gross Margin $889,774 $2,933,571 $15,147,630 $42,274,977 $84,510,707Gross Margin/Revenue 85% 89% 92% 92% 92%
ExpensesMobile Advertising $125,000 $125,000 $250,000 $375,000 $562,500Digital Ad, Site Investment & Development $580,000 $170,000 $340,000 $510,000 $765,000Customer Relationship Management $250,000 $250,000 $500,000 $750,000 $1,125,000Trade Shows, Conferences & Events $100,000 $100,000 $200,000 $300,000 $450,000Social Media Community Growth & Engagement $125,000 $125,000 $250,000 $375,000 $562,500Brand Building $275,000 $275,000 $550,000 $825,000 $1,237,500Digital Marketing $250,000 $250,000 $500,000 $750,000 $1,125,000New Product Initiatives $200,000 $200,000 $400,000 $600,000 $900,000Placement Expense $275,000 $275,000 $550,000 $825,000 $1,237,500Rent & Utilities $100,000 $175,000 $268,750 $331,250 $368,750Travel & Entertainment $24,000 $42,000 $64,500 $79,500 $88,500Professional Fees $30,000 $60,000 $90,000 $112,500 $123,750PBG and Henderson Marketing/Sales Departments $143,840 $287,680 $431,520 $539,400 $593,340Ongoing Technology Costs (4%) $41,872 $131,422 $658,593 $1,838,042 $3,674,379Misc $118,713 $65,711 $329,296 $919,021 $1,837,189Depreciation $2,667 $4,667 $7,167 $8,833 $9,833Payroll Taxes & Benefits $142,500 $245,700 $376,228 $481,861 $560,652Total Personnel $950,000 $1,638,000 $2,508,188 $3,212,409 $3,737,682
Total Op. Expenses $3,733,591 $4,420,180 $8,274,241 $12,832,818 $18,959,075
Profit Before Int. & Tax ($2,843,817) ($1,486,609) $6,873,389 $29,442,159 $65,551,632EBITDA ($2,841,151) ($1,481,942) $6,880,555 $29,450,992 $65,561,465Interest Expense $0 $0 $0 $0 $0Taxes Incurred $0 $0 $1,030,829 $10,304,756 $22,943,071
Net Profit ($2,843,817) ($1,486,609) $5,842,560 $19,137,403 $42,608,561Net Profit % -271.7% -45.2% 35.5% 41.6% 46.4%
PRO FORMA PROFIT & LOSS
The Company intends to deploy its funding to maximize growth and profitability.
In the Profit and Loss table below, gross margin equals revenue minus direct
costs. The “bottom line” or profit (as measured before and after interest, taxes,
depreciation, and amortization) equals gross margin minus operating expenses.
P ro Fo r m a P ro f i t & L o s s
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n5 4
Break-Even Month 35
Accumulated Gross Revenue $18,217,237
BREAK-EVEN ANALYSIS
The table and chart below demonstrate when the Company is expected to become
profitable. Break-even occurs when accumulated revenue equals accumulated
expenses. According to the forecasted financials, month 35 will be the point at
which break-even will occur.
B re a k E v e n
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n 5 5
Year 1 Year 2 Year 3 Year 4 Year 5OPERATINGNet Profit ($2,843,817) ($1,486,609) $5,842,560 $19,137,403 $42,608,561Adjustments to Net Profit
Depreciation & Amortization $2,667 $4,667 $7,167 $8,833 $9,833(Increases)/Decreases in Accounts Receivable $0 $0 $0 $0 $0(Additions)/Depletions of Inventory $0 $0 $0 $0 $0Increases/(Decreases) in Accounts Payable $191,107 $72,309 $1,010,355 $1,203,185 $2,371,695
Net Cash From Operating Activities ($2,650,044) ($1,409,634) $6,860,081 $20,349,422 $44,990,089
INVESTINGPurchase of Other Current Assets $0 $0 $0 $0 $0Sale of Other Current Assets $0 $0 $0 $0 $0Purchase of Land $0 $0 $0 $0 $0Sale of Land $0 $0 $0 $0 $0Purchase Long-term Assets ($40,000) ($30,000) ($37,500) ($25,000) ($15,000)Sale of Long-term Assets $0 $0 $0 $0 $0Net Cash From Investing Activities ($40,000) ($30,000) ($37,500) ($25,000) ($15,000)
FINANCINGInvestment $5,000,000 $0 $0 $0 $0Dividends $0 $0 $0 $0 $0New Current Borrowing $0 $0 $0 $0 $0Current Borrowing Repay. $0 $0 $0 $0 $0New Long Term Liabilities $0 $0 $0 $0 $0Long Term Liability Repay $0 $0 $0 $0 $0Net Cash From Financing Activities $5,000,000 $0 $0 $0 $0NET CASH FLOW $2,309,956 ($1,439,634) $6,822,581 $20,324,422 $44,975,089Beginning Cash $0 $2,309,956 $870,323 $7,692,904 $28,017,326Ending Cash $2,309,956 $870,323 $7,692,904 $28,017,326 $72,992,415
CASH FLOW
The following depictions of the Company’s projected cash flow show the Company
expects to maintain sufficient cash balances over the five years of this plan. The
“pro forma cash flow” table differs from the “pro forma profit and loss” (P&L) table.
Pro forma cash flow is intended to represent the actual flow of cash in and out of
the Company. In comparison, the revenue and expense projections on the P&L
table include “non-cash” items and exclude funding and investment illustrations.
C a s h F l o w
C a s h F l o w
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n5 6
The balance sheet below highlights the Company’s projected assets, liabilities,
and capital:
Year 1 Year 2 Year 3 Year 4 Year 5Assets
Current AssetsCash $2,309,956 $870,323 $7,692,904 $28,017,326 $72,992,415Accounts Receivable $0 $0 $0 $0 $0Inventory $0 $0 $0 $0 $0Other Current Assets $0 $0 $0 $0 $0
Total Current Assets $2,309,956 $870,323 $7,692,904 $28,017,326 $72,992,415
Fixed AssetsLong-term Assets $40,000 $70,000 $107,500 $132,500 $147,500Accum. Depreciation $2,667 $7,333 $14,500 $23,333 $33,167Land $0 $0 $0 $0 $0
Total Fixed Assets $37,333 $62,667 $93,000 $109,167 $114,333Total Assets $2,347,289 $932,989 $7,785,904 $28,126,492 $73,106,748
Liabilities and CapitalCurrent Liabilities
Accounts Payable $191,107 $263,415 $1,273,770 $2,476,956 $4,848,650Current Borrowing $0 $0 $0 $0 $0Other Current Liabilities $0 $0 $0 $0 $0
Subtotal Current Liabilities $191,107 $263,415 $1,273,770 $2,476,956 $4,848,650
Long-term Liabilities $0 $0 $0 $0 $0Total Liabilities $191,107 $263,415 $1,273,770 $2,476,956 $4,848,650
Paid-in Capital $5,000,000 $5,000,000 $5,000,000 $5,000,000 $5,000,000Retained Earnings $0 ($2,843,817) ($4,330,426) $1,512,134 $20,649,537Earnings ($2,843,817) ($1,486,609) $5,842,560 $19,137,403 $42,608,561
Total Capital $2,156,183 $669,574 $6,512,134 $25,649,537 $68,258,098Total Liabilities and Capital $2,347,289 $932,989 $7,785,904 $28,126,492 $73,106,748
BALANCE SHEET B a l a n c e S h e e t
C O N F I D E N T I A L – D o N o t D i s t r i b u t e W i t h o u t P e r m i s s i o n 5 7
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue $1,203,812 $3,778,393 $18,934,537 $52,843,721 $105,638,384Cost of Goods $180,572 $404,786 $1,514,763 $4,227,498 $8,451,071Gross Margin $1,023,240 $3,373,607 $17,419,774 $48,616,223 $97,187,313Gross Margin/Revenue 85% 89% 92% 92% 92%Operating Expenses $3,733,591 $4,420,180 $8,274,241 $12,832,818 $18,959,075Net Profit ($2,710,351) ($1,046,573) $5,944,596 $23,259,214 $50,848,355Net Profit/Revenue -225% -28% 31% 44% 48%
Cash Flow $2,443,422 ($999,598) $6,924,618 $24,446,232 $53,214,883Cash Balance $2,443,422 $1,443,824 $8,368,442 $32,814,675 $86,029,557
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue $889,774 $2,792,725 $13,995,093 $39,058,403 $78,080,545Cost of Goods $133,466 $299,189 $1,119,607 $3,124,672 $6,246,444Gross Margin $756,308 $2,493,536 $12,875,485 $35,933,730 $71,834,101Gross Margin/Revenue 85% 89% 92% 92% 92%Operating Expenses $3,733,591 $4,420,180 $8,274,241 $12,832,818 $18,959,075Net Profit ($2,977,283) ($1,926,644) $4,601,244 $15,015,593 $34,368,767Net Profit/Revenue -335% -69% 33% 38% 44%
Cash Flow $2,176,490 ($1,879,669) $5,581,266 $16,202,612 $36,735,295Cash Balance $2,176,490 $296,821 $5,878,086 $22,080,698 $58,815,993
WORST CASE SCENARIO
BEST CASE SCENARIOREVENUE IS 15% GREATER THAN PROJECTED
REVENUE IS 15% LESS THAN PROJECTED
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue $1,203,812 $3,778,393 $18,934,537 $52,843,721 $105,638,384Cost of Goods $180,572 $404,786 $1,514,763 $4,227,498 $8,451,071Gross Margin $1,023,240 $3,373,607 $17,419,774 $48,616,223 $97,187,313Gross Margin/Revenue 85% 89% 92% 92% 92%Operating Expenses $3,733,591 $4,420,180 $8,274,241 $12,832,818 $18,959,075Net Profit ($2,710,351) ($1,046,573) $5,944,596 $23,259,214 $50,848,355Net Profit/Revenue -225% -28% 31% 44% 48%
Cash Flow $2,443,422 ($999,598) $6,924,618 $24,446,232 $53,214,883Cash Balance $2,443,422 $1,443,824 $8,368,442 $32,814,675 $86,029,557
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue $889,774 $2,792,725 $13,995,093 $39,058,403 $78,080,545Cost of Goods $133,466 $299,189 $1,119,607 $3,124,672 $6,246,444Gross Margin $756,308 $2,493,536 $12,875,485 $35,933,730 $71,834,101Gross Margin/Revenue 85% 89% 92% 92% 92%Operating Expenses $3,733,591 $4,420,180 $8,274,241 $12,832,818 $18,959,075Net Profit ($2,977,283) ($1,926,644) $4,601,244 $15,015,593 $34,368,767Net Profit/Revenue -335% -69% 33% 38% 44%
Cash Flow $2,176,490 ($1,879,669) $5,581,266 $16,202,612 $36,735,295Cash Balance $2,176,490 $296,821 $5,878,086 $22,080,698 $58,815,993
WORST CASE SCENARIO
BEST CASE SCENARIOREVENUE IS 15% GREATER THAN PROJECTED
REVENUE IS 15% LESS THAN PROJECTED
The sensitivity analysis below assumes revenues are 15% higher or lower than
figures projected earlier in this business plan:
B e s t C a s e S c e n a r i o
W o r s t C a s e S c e n a r i o
CONF
IDEN
TIAL
– D
o No
t Di
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bute
Wit
hout
Per
mis
sion
58
APP
ENDI
X: Y
EAR
1 FI
NANC
IALS
BY
MON
TH
Reve
nue
Fore
cast
Mon
th 1
Mon
th 2
Mon
th 3
Mon
th 4
Mon
th 5
Mon
th 6
Mon
th 7
Mon
th 8
Mon
th 9
Mon
th 1
0M
onth
11
Mon
th 1
2
Rev
enue
1,00
0 Im
pres
sion
Pac
kage
s$3
3,06
5$3
4,05
7$3
5,07
9$3
6,13
1$3
7,21
5$3
8,33
2$3
9,48
2$4
0,66
6$4
1,88
6$4
3,14
3$4
4,43
7$4
5,77
0
2,50
0 Im
pres
sion
Pac
kage
s$2
4,84
0$2
5,58
6$2
6,35
3$2
7,14
4$2
7,95
8$2
8,79
7$2
9,66
1$3
0,55
1$3
1,46
7$3
2,41
1$3
3,38
3$3
4,38
5
3,00
0 Im
pres
sion
Pac
kage
s$1
5,85
4$1
6,32
9$1
6,81
9$1
7,32
4$1
7,84
3$1
8,37
9$1
8,93
0$1
9,49
8$2
0,08
3$2
0,68
5$2
1,30
6$2
1,94
5To
tal R
even
ue$7
3,75
9$7
5,97
2$7
8,25
1$8
0,59
9$8
3,01
7$8
5,50
7$8
8,07
2$9
0,71
5$9
3,43
6$9
6,23
9$9
9,12
6$1
02,1
00
Dire
ct C
ost o
f Rev
enue
Hos
ting,
Com
mis
sion
s, B
ack
End
Cos
ts$1
1,06
4$1
1,39
6$1
1,73
8$1
2,09
0$1
2,45
2$1
2,82
6$1
3,21
1$1
3,60
7$1
4,01
5$1
4,43
6$1
4,86
9$1
5,31
5
Subt
otal
Cos
t of R
even
ue$1
1,06
4$1
1,39
6$1
1,73
8$1
2,09
0$1
2,45
2$1
2,82
6$1
3,21
1$1
3,60
7$1
4,01
5$1
4,43
6$1
4,86
9$1
5,31
5
Oth
er D
irect
Cos
t$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0To
tal D
irect
Cos
ts$1
1,06
4$1
1,39
6$1
1,73
8$1
2,09
0$1
2,45
2$1
2,82
6$1
3,21
1$1
3,60
7$1
4,01
5$1
4,43
6$1
4,86
9$1
5,31
5
Gro
ss M
argi
n$6
2,69
5$6
4,57
6$6
6,51
3$6
8,50
9$7
0,56
4$7
2,68
1$7
4,86
2$7
7,10
7$7
9,42
1$8
1,80
3$8
4,25
7$8
6,78
5
Gro
ss M
argi
n/R
even
ue85
%85
%85
%85
%85
%85
%85
%85
%85
%85
%85
%85
%
REV
ENU
E FO
REC
AST
CONF
IDEN
TIAL
– D
o No
t Di
stri
bute
Wit
hout
Per
mis
sion
59
Unit
Ass
umpt
ions
Mon
th 1
Mon
th 2
Mon
th 3
Mon
th 4
Mon
th 5
Mon
th 6
Mon
th 7
Mon
th 8
Mon
th 9
Mon
th 1
0M
onth
11
Mon
th 1
2
Uni
ts 1,00
0 Im
pres
sion
Pac
kage
s16
617
117
618
218
719
319
820
421
021
722
323
0
2,50
0 Im
pres
sion
Pac
kage
s83
8688
9194
9699
102
105
108
112
115
3,00
0 Im
pres
sion
Pac
kage
s40
4142
4345
4647
4950
5253
55To
tal U
nits
289
298
307
316
325
335
345
355
366
377
388
400
Uni
t Pric
e
1,00
0 Im
pres
sion
Pac
kage
s$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0$1
99.0
0
2,50
0 Im
pres
sion
Pac
kage
s$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0$2
99.0
0
3,00
0 Im
pres
sion
Pac
kage
s$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0$3
99.0
0
Dire
ct U
nit C
ost
1,00
0 Im
pres
sion
Pac
kage
s$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0
2,50
0 Im
pres
sion
Pac
kage
s$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0
3,00
0 Im
pres
sion
Pac
kage
s$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0$0
.00
$0.0
0
UN
IT A
SSU
MPT
ION
S
CONF
IDEN
TIAL
– D
o No
t Di
stri
bute
Wit
hout
Per
mis
sion
60
Mon
th 1
Mon
th 2
Mon
th 3
Mon
th 4
Mon
th 5
Mon
th 6
Mon
th 7
Mon
th 8
Mon
th 9
Mon
th 1
0M
onth
11
Mon
th 1
2
Pers
onne
l Cou
nt
Foun
der &
CEO
11
11
11
11
11
11
Foun
der &
Edi
tor-i
n-C
hief
11
11
11
11
11
11
CO
O1
11
11
11
11
11
1C
FO1
11
11
11
11
11
1
Dev
elop
ers
11
11
11
11
11
11
Sale
s &
Mar
ketin
g St
aff
66
66
66
66
66
66
Con
tent
Man
agem
ent S
taff
33
33
33
33
33
33
Adm
in/O
ther
22
22
22
22
22
22
Tota
l Per
sonn
el16
1616
1616
1616
1616
1616
16
Pers
onne
l Wag
eFo
unde
r & C
EO$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83
Foun
der &
Edi
tor-i
n-C
hief
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
CO
O$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83
CFO
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
Dev
elop
ers
$5,4
17$5
,417
$5,4
17$5
,417
$5,4
17$5
,417
$5,4
17$5
,417
$5,4
17$5
,417
$5,4
17$5
,417
Sale
s &
Mar
ketin
g St
aff
$4,5
83$4
,583
$4,5
83$4
,583
$4,5
83$4
,583
$4,5
83$4
,583
$4,5
83$4
,583
$4,5
83$4
,583
Con
tent
Man
agem
ent S
taff
$3,7
50$3
,750
$3,7
50$3
,750
$3,7
50$3
,750
$3,7
50$3
,750
$3,7
50$3
,750
$3,7
50$3
,750
Adm
in/O
ther
$3,3
33$3
,333
$3,3
33$3
,333
$3,3
33$3
,333
$3,3
33$3
,333
$3,3
33$3
,333
$3,3
33$3
,333
Pers
onne
l Cos
ts
Foun
der &
CEO
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
Foun
der &
Edi
tor-i
n-C
hief
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
CO
O$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83
CFO
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
$7,0
83$7
,083
Dev
elop
ers
$5,4
17$5
,417
$5,4
17$5
,417
$5,4
17$5
,417
$5,4
17$5
,417
$5,4
17$5
,417
$5,4
17$5
,417
Sale
s &
Mar
ketin
g St
aff
$27,
500
$27,
500
$27,
500
$27,
500
$27,
500
$27,
500
$27,
500
$27,
500
$27,
500
$27,
500
$27,
500
$27,
500
Con
tent
Man
agem
ent S
taff
$11,
250
$11,
250
$11,
250
$11,
250
$11,
250
$11,
250
$11,
250
$11,
250
$11,
250
$11,
250
$11,
250
$11,
250
Adm
in/O
ther
$6,6
67$6
,667
$6,6
67$6
,667
$6,6
67$6
,667
$6,6
67$6
,667
$6,6
67$6
,667
$6,6
67$6
,667
Tota
l Pay
roll
$79,
167
$79,
167
$79,
167
$79,
167
$79,
167
$79,
167
$79,
167
$79,
167
$79,
167
$79,
167
$79,
167
$79,
167
Payr
oll/R
even
ue10
7.33
%10
4.21
%10
1.17
%98
.22%
95.3
6%92
.58%
89.8
9%87
.27%
84.7
3%82
.26%
79.8
6%77
.54%
PER
SON
NEL
FO
REC
AST
Pers
onne
l Fo
reca
st
CONF
IDEN
TIAL
– D
o No
t Di
stri
bute
Wit
hout
Per
mis
sion
61
Mon
th 1
Mon
th 2
Mon
th 3
Mon
th 4
Mon
th 5
Mon
th 6
Mon
th 7
Mon
th 8
Mon
th 9
Mon
th 1
0M
onth
11
Mon
th 1
2
Tota
l Rev
enue
$73,
759
$75,
972
$78,
251
$80,
599
$83,
017
$85,
507
$88,
072
$90,
715
$93,
436
$96,
239
$99,
126
$102
,100
Tota
l Dire
ct C
ost o
f Rev
enue
$11,
064
$11,
396
$11,
738
$12,
090
$12,
452
$12,
826
$13,
211
$13,
607
$14,
015
$14,
436
$14,
869
$15,
315
Gro
ss M
argi
n$6
2,69
5$6
4,57
6$6
6,51
3$6
8,50
9$7
0,56
4$7
2,68
1$7
4,86
2$7
7,10
7$7
9,42
1$8
1,80
3$8
4,25
7$8
6,78
5
Gro
ss M
argi
n/R
even
ue85
%85
%85
%85
%85
%85
%85
%85
%85
%85
%85
%85
%
Expe
nses
Mob
ile A
dver
tisin
g$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7
Dig
ital A
d, S
ite In
vest
men
t & D
evel
opm
ent
$214
,167
$64,
167
$64,
167
$64,
167
$49,
167
$39,
167
$14,
167
$14,
167
$14,
167
$14,
167
$14,
167
$14,
167
Cus
tom
er R
elat
ions
hip
Man
agem
ent
$20,
833
$20,
833
$20,
833
$20,
833
$20,
833
$20,
833
$20,
833
$20,
833
$20,
833
$20,
833
$20,
833
$20,
833
Trad
e Sh
ows,
Con
fere
nces
& E
vent
s$8
,333
$8,3
33$8
,333
$8,3
33$8
,333
$8,3
33$8
,333
$8,3
33$8
,333
$8,3
33$8
,333
$8,3
33So
cial
Med
ia C
omm
unity
Gro
wth
& E
ngag
emen
t$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7$1
0,41
7
Bran
d Bu
ildin
g$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7$2
2,91
7D
igita
l Mar
ketin
g$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3$2
0,83
3
New
Pro
duct
Initi
ativ
es$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7$1
6,66
7
Plac
emen
t Exp
ense
$22,
917
$22,
917
$22,
917
$22,
917
$22,
917
$22,
917
$22,
917
$22,
917
$22,
917
$22,
917
$22,
917
$22,
917
Ren
t & U
tiliti
es$8
,333
$8,3
33$8
,333
$8,3
33$8
,333
$8,3
33$8
,333
$8,3
33$8
,333
$8,3
33$8
,333
$8,3
33
Trav
el &
Ent
erta
inm
ent
$2,0
00$2
,000
$2,0
00$2
,000
$2,0
00$2
,000
$2,0
00$2
,000
$2,0
00$2
,000
$2,0
00$2
,000
Prof
essi
onal
Fee
s$2
,500
$2,5
00$2
,500
$2,5
00$2
,500
$2,5
00$2
,500
$2,5
00$2
,500
$2,5
00$2
,500
$2,5
00
PBG
and
Hen
ders
on M
arke
ting/
Sale
s D
epar
tmen
ts$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7$1
1,98
7O
ngoi
ng T
echn
olog
y C
osts
(4%
)$2
,950
$3,0
39$3
,130
$3,2
24$3
,321
$3,4
20$3
,523
$3,6
29$3
,737
$3,8
50$3
,965
$4,0
84
Mis
c $9
9,25
2$1
,519
$1,5
65$1
,612
$1,6
60$1
,710
$1,7
61$1
,814
$1,8
69$1
,925
$1,9
83$2
,042
Dep
reci
atio
n$2
22$2
22$2
22$2
22$2
22$2
22$2
22$2
22$2
22$2
22$2
22$2
22
Payr
oll T
axes
& B
enef
its$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5$1
1,87
5
Tota
l Per
sonn
el$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7$7
9,16
7To
tal O
p. E
xpen
ses
$565
,786
$318
,142
$318
,279
$318
,420
$303
,565
$293
,714
$268
,868
$269
,027
$269
,190
$269
,358
$269
,531
$269
,710
Prof
it Be
fore
Int.
& Ta
x($
503,
091)
($25
3,56
6)($
251,
765)
($24
9,91
1)($
233,
001)
($22
1,03
3)($
194,
007)
($19
1,91
9)($
189,
769)
($18
7,55
5)($
185,
274)
($18
2,92
5)
EBIT
DA
($50
2,86
9)($
253,
344)
($25
1,54
3)($
249,
689)
($23
2,77
9)($
220,
811)
($19
3,78
5)($
191,
697)
($18
9,54
7)($
187,
333)
($18
5,05
2)($
182,
703)
Inte
rest
Exp
ense
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Taxe
s In
curre
d$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0
Net
Pro
fit($
503,
091)
($25
3,56
6)($
251,
765)
($24
9,91
1)($
233,
001)
($22
1,03
3)($
194,
007)
($19
1,91
9)($
189,
769)
($18
7,55
5)($
185,
274)
($18
2,92
5)
Net
Pro
fit %
-682
.1%
-333
.8%
-321
.7%
-310
.1%
-280
.7%
-258
.5%
-220
.3%
-211
.6%
-203
.1%
-194
.9%
-186
.9%
-179
.2%
PRO
FO
RM
A P
RO
FIT
& L
OSS
Pr
o Fo
rma
Prof
it &
Los
s
CONF
IDEN
TIAL
– D
o No
t Di
stri
bute
Wit
hout
Per
mis
sion
62
Cash
Flo
wM
onth
1M
onth
2M
onth
3M
onth
4M
onth
5M
onth
6M
onth
7M
onth
8M
onth
9M
onth
10
Mon
th 1
1M
onth
12
OPE
RA
TIN
GN
et P
rofit
($50
3,09
1)($
253,
566)
($25
1,76
5)($
249,
911)
($23
3,00
1)($
221,
033)
($19
4,00
7)($
191,
919)
($18
9,76
9)($
187,
555)
($18
5,27
4)($
182,
925)
Adju
stm
ents
to N
et P
rofit
Dep
reci
atio
n &
Amor
tizat
ion
$222
$222
$222
$222
$222
$222
$222
$222
$222
$222
$222
$222
(Incr
ease
s)/D
ecre
ases
in A
ccou
nts
Rec
eiva
ble
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
(Add
ition
s)/D
eple
tions
of I
nven
tory
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Incr
ease
s/(D
ecre
ases
) in
Acco
unts
Pay
able
$478
,935
($24
3,92
4)$4
72$4
86($
14,2
94)
($9,
347)
($24
,126
)$5
47$5
64$5
81$5
98$6
16
Net
Cas
h Fr
om O
pera
ting
Activ
ities
($23
,934
)($
497,
268)
($25
1,07
1)($
249,
202)
($24
7,07
2)($
230,
158)
($21
7,91
1)($
191,
150)
($18
8,98
4)($
186,
752)
($18
4,45
4)($
182,
087)
INVE
STIN
GPu
rcha
se o
f Oth
er C
urre
nt A
sset
s$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0
Sale
of O
ther
Cur
rent
Ass
ets
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Purc
hase
of L
and
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Sale
of L
and
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Purc
hase
Lon
g-te
rm A
sset
s($
40,0
00)
$0$0
$0$0
$0$0
$0$0
$0$0
$0
Sale
of L
ong-
term
Ass
ets
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Net
Cas
h Fr
om In
vest
ing
Activ
ities
($40
,000
)$0
$0$0
$0$0
$0$0
$0$0
$0$0
FIN
AN
CIN
GIn
vest
men
t$5
,000
,000
$0$0
$0$0
$0$0
$0$0
$0$0
$0
Div
iden
ds$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0
New
Cur
rent
Bor
row
ing
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Cur
rent
Bor
row
ing
Rep
ay.
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
New
Lon
g Te
rm L
iabi
litie
s$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0Lo
ng T
erm
Lia
bilit
y R
epay
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Net
Cas
h Fr
om F
inan
cing
Act
iviti
es$5
,000
,000
$0$0
$0$0
$0$0
$0$0
$0$0
$0
NET
CA
SH F
LOW
$4,9
36,0
66($
497,
268)
($25
1,07
1)($
249,
202)
($24
7,07
2)($
230,
158)
($21
7,91
1)($
191,
150)
($18
8,98
4)($
186,
752)
($18
4,45
4)($
182,
087)
Beg
inni
ng C
ash
$0$4
,936
,066
$4,4
38,7
97$4
,187
,726
$3,9
38,5
24$3
,691
,452
$3,4
61,2
93$3
,243
,383
$3,0
52,2
33$2
,863
,249
$2,6
76,4
97$2
,492
,043
Endi
ng C
ash
$4,9
36,0
66$4
,438
,797
$4,1
87,7
26$3
,938
,524
$3,6
91,4
52$3
,461
,293
$3,2
43,3
83$3
,052
,233
$2,8
63,2
49$2
,676
,497
$2,4
92,0
43$2
,309
,956
CA
SH F
LOW
CONF
IDEN
TIAL
– D
o No
t Di
stri
bute
Wit
hout
Per
mis
sion
63
Bala
nce
Shee
tM
onth
1M
onth
2M
onth
3M
onth
4M
onth
5M
onth
6M
onth
7M
onth
8M
onth
9M
onth
10
Mon
th 1
1M
onth
12
Asse
ts
Cur
rent
Ass
ets
Cas
h$4
,936
,066
$4,4
38,7
97$4
,187
,726
$3,9
38,5
24$3
,691
,452
$3,4
61,2
93$3
,243
,383
$3,0
52,2
33$2
,863
,249
$2,6
76,4
97$2
,492
,043
$2,3
09,9
56
Acco
unts
Rec
eiva
ble
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Inve
ntor
y$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0
Oth
er C
urre
nt A
sset
s$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0
Tota
l Cur
rent
Ass
ets
$4,9
36,0
66$4
,438
,797
$4,1
87,7
26$3
,938
,524
$3,6
91,4
52$3
,461
,293
$3,2
43,3
83$3
,052
,233
$2,8
63,2
49$2
,676
,497
$2,4
92,0
43$2
,309
,956
Fixe
d As
sets
Long
-term
Ass
ets
$40,
000
$40,
000
$40,
000
$40,
000
$40,
000
$40,
000
$40,
000
$40,
000
$40,
000
$40,
000
$40,
000
$40,
000
Accu
m. D
epre
ciat
ion
$222
$444
$667
$889
$1,1
11$1
,333
$1,5
56$1
,778
$2,0
00$2
,222
$2,4
44$2
,667
Land
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Tota
l Fix
ed A
sset
s$3
9,77
8$3
9,55
6$3
9,33
3$3
9,11
1$3
8,88
9$3
8,66
7$3
8,44
4$3
8,22
2$3
8,00
0$3
7,77
8$3
7,55
6$3
7,33
3
Tota
l Ass
ets
$4,9
75,8
43$4
,478
,353
$4,2
27,0
60$3
,977
,635
$3,7
30,3
40$3
,499
,960
$3,2
81,8
27$3
,090
,455
$2,9
01,2
49$2
,714
,275
$2,5
29,5
98$2
,347
,289
Liab
ilitie
s an
d C
apita
l
Cur
rent
Lia
bilit
ies
Acco
unts
Pay
able
$478
,935
$235
,010
$235
,482
$235
,968
$221
,675
$212
,328
$188
,201
$188
,749
$189
,312
$189
,893
$190
,491
$191
,107
Cur
rent
Bor
row
ing
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Oth
er C
urre
nt L
iabi
litie
s$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0
Subt
otal
Cur
rent
Lia
bilit
ies
$478
,935
$235
,010
$235
,482
$235
,968
$221
,675
$212
,328
$188
,201
$188
,749
$189
,312
$189
,893
$190
,491
$191
,107
Long
-term
Lia
bilit
ies
$0$0
$0$0
$0$0
$0$0
$0$0
$0$0
Tota
l Lia
bilit
ies
$478
,935
$235
,010
$235
,482
$235
,968
$221
,675
$212
,328
$188
,201
$188
,749
$189
,312
$189
,893
$190
,491
$191
,107
Paid
-in C
apita
l$5
,000
,000
$5,0
00,0
00$5
,000
,000
$5,0
00,0
00$5
,000
,000
$5,0
00,0
00$5
,000
,000
$5,0
00,0
00$5
,000
,000
$5,0
00,0
00$5
,000
,000
$5,0
00,0
00
Ret
aine
d Ea
rnin
gs$0
$0$0
$0$0
$0$0
$0$0
$0$0
$0
Earn
ings
($50
3,09
1)($
756,
657)
($1,
008,
423)
($1,
258,
334)
($1,
491,
334)
($1,
712,
368)
($1,
906,
374)
($2,
098,
294)
($2,
288,
063)
($2,
475,
618)
($2,
660,
892)
($2,
843,
817)
Tota
l Cap
ital
$4,4
96,9
09$4
,243
,343
$3,9
91,5
77$3
,741
,666
$3,5
08,6
66$3
,287
,632
$3,0
93,6
26$2
,901
,706
$2,7
11,9
37$2
,524
,382
$2,3
39,1
08$2
,156
,183
Tota
l Lia
bilit
ies
and
Cap
ital
$4,9
75,8
43$4
,478
,353
$4,2
27,0
60$3
,977
,635
$3,7
30,3
40$3
,499
,960
$3,2
81,8
27$3
,090
,455
$2,9
01,2
49$2
,714
,275
$2,5
29,5
98$2
,347
,289
BA
LAN
CE
SHEE
T
S A M A N T H O N YPhone: (800) 548-5006Fax: (202) 478-2700 Email: [email protected]