FITNESSCONNECT

MANAGEMENT TEAM

Sean McQueen – CEO

Jeffrey Banks – CFO

Annapaula Sizemore – COO

George Braga – Marketing Manager

PRESENTATION AGENDA

Business Concept

Company Mission

Investor opportunities

Market Assessment

Marketing Plan

Operations Plan

Financial Plan

Exit Strategy

BUSINESS CONCEPT OVERVIEW

With competitors outdoing others year after year, FitnessConnect

aims to build a commitment level within the target market; a level

that makes it even easier to commit to. Our idea, in its entirety, is

to provide a revolutionary Live In-home workout system

broadcasted straight from a home-based gym. This will provide

the flexibility to maintain a workout schedule no matter life’s daily

challenges. For those who are onsite, FitnessConnect offers free

health assessments and guides to healthy eating in addition to

expected services and amenities. No matter what life’s daily

challenges throw, FitnessConnect offers solutions to keep you on

track to a healthier you.

MISSION STATEMENT

“DELIVER A HIGHER QUALITY OF LIFE TO OUR CLIENTS BY

OFFERING A DISTINCT STYLE OF FITNESS TRAINING”

SLOGAN

“COMMIT TO BE FIT”

INVESTOR OPPORTUNITIES

$200,000

33%

$400,000

67%

Partners Capital

Investors

INVESTMENT PROPOSAL

A steady return on investment

An excellent management team

A solid business plan

Anticipated 41% ROI by the end of year 5

SOURCES OF FUNDING

$-

$100,000.00

$200,000.00

$300,000.00

$400,000.00

$500,000.00

$600,000.00

$700,000.00

Sean

McQueen

Jeffrey

Banks

Annapaula

Sizemore

George

Braga

Investors Total

Capital

$400,000 Needed to get business off the ground.

$80,000$40,000$40,000$40,000

$600,000

$400,000

Presenting Market Assessment :

GEORGE C. BRAGA

MARKET SIZE & TRENDS

Burbank Population – 104,391 (U.S. Census )

Media Center : Warner Bros. Entertainment, Warner Music

Group, NBC Universal, The Walt Disney Company, ABC,

Cartoon Network, Nickelodeon, Cookie Jar Entertainment,

New Wave Entertainment, and Insomniac Games.

People who don’t mind spending more on convenience.

Population aged between 18-50 years old

Based on lifestyle & interests

PRIMARY MARKET

SECONDARY MARKET

Population over 51 years old

Education, income etc.

TARGETED MARKET

INDUSTRY ANALYSIS

Industry at a Glance

INDUSTRY ANALYSIS

INDUSTRY AT A GLANCE

MARKET SEGMENTATION

INDUSTRY DATA

YEAR REVENUE $ MILLION GROWTH %

2015 $ 27,339.2 3.1 %

2016 $ 28,225.2 3.2 %

2017 $ 29,014.0 2.8 %

2018 $ 29,913.4 3.1 %

2019 $ 30,511.7 2.0 %

REGULATORY REVIEW

Industry’s regulation-light

NBFE- National Board of Fitness Examiners:

1. Define and address scope of practice for fitness

professionals

2. Determine the standards of practice

COMPETITIVE ANALYSIS

In Burbank area - there are about 39 gym business focusing on

regular fitness programs

Three major competitors: LA|FITNESS , 24 HOUR FITNESS

AND EQUINOX

FitnessConnect – top of the line equipment, certified trainers,

excellent customer service

COMPETITIVE ANALYSISPRICE COMPARISON

$749.99

$1,499.99

$4,807.69

$-

$1,000.00

$2,000.00

$3,000.00

$4,000.00

$5,000.00

$6,000.00

Fitness Connect 24hr Fitness Equinox

Membership with Personal Trainer

SWOT Analysis

INTERNAL

STRENGTHS WEAKNESSES

Certified personal trainers and dietician

Top of the line equipment

Highest quality of service

Accessibility for everybody

Strong management team

Specialized fitness plans

No established customer base

Unknown brand name

First business venture

Limited startup costs

EXTERNAL

OPPORTUNITIES THREATS

Growing market

Group training

Internet, social media

Targeting new demographics

Outdoor activities

Wide spread competition

Equipment maintenance

Local and federal regulations

Insurance costs

Consumer confidence

SURVEY QUESTIONS AND RESULTS100 People Surveyed

1. What age group do you fall under?

a. 18 to 35 years old

b. 36 to 50 years old

c. 51 years and up

Answers: 48 % (A) // 33% (B) // 19 % (C)

2. How often do you go to the gym?

a. 1 time per week

b. 2-3 times per week

c. 5+ times per week

Answers: 57 % (A) // 21% (B) // 22 % (C)

3. Why do you go to the gym?

a. Lifestyle

b. Weight Loss

c. Health Improvement

d. Social Environment

Answers: 37 % (A) // 8 % (B) // 12 % (C) //43 % (D)

SURVEY QUESTIONS AND RESULTS100 People Surveyed

4. What are your preferred hours to visit the gym?

a.5 AM – 12 PM

b.12 PM – 6 PM

c.6 PM – 12 AM

Answers: 37% (5AM-12PM) // 5 % (12PM-6PM) // 48 % (6PM-12AM)

5. What is your preferred length of membership contract?

a. Month to Month

b. Semi-Annual Basis

c. Annual Basis

d. Not at all

Answers: 32 % (A) // 53 % (B) // 12 % (C) // 3% (D)

6. How likely would you pay extra for the convenience of an in house workout

service?

a. Very

b. Somewhat

c. Not very

d. Not at all

Answers: 42% (A) // 35 % (B) //14% (C) // 9 % (D)

Presenting Marketing Plan :

SEAN McQUEEN

MARKETING MIX

• Innovative live In-Home Fitness and Gym

Product

• Membership starting at $24.99/month

Price

• Burbank, California

• Direct Sales, advertising and Word of Mouth

Place Promotion

MARKET NEED & PRODUCT EXCLUSIVITY

Market Need

• People of Burbank are in need of extra

time to work out.

Product Exclusivity

• Live In-Home Workout

MARKETING STRATEGY

Focuses on the following:

• Elite Program

• Increase Customer Base

• Lifestyle Change

• Target Market and Increase Market

PRICING STRATEGY

Value Pricing

• Low Basic Membership to draw

in the masses

• In-Home flexibility

• More visits from personal

trainers for same price.

MARKETING

COMMUNICATION PLAN

Customize Marketing Channels

Brochures/Flyers

Signs/Billboards

Local News Papers

Social Media

Maintenance Housing

MARKETING BUDGET

Where the $16,512 is spent

Brochures/ Flyers

Signs Billboards

Local News Papers

Online

Maintenance

Hosting

1st Year Advertising Plan

2014 2015 2016 2017 2018

Brochures/Flyers $2,917 $2,917 $2917 $2917 $2917

Signs/Billboards $10,000 $10,000 $10,000 $10,000 $10,000

Local News Papers $1,095 $1,095 $1,095 $1,095 $1,095

Online $1,000 $1,000 $1,000 $1,000 $1,000

Maintenance Hosting $1,500 $1,500 $1,500 $1,500 $1,500

Annual Expense $16,512 $16,512 $16,512 $16,512 $16,512

Presenting Operations Plan :

ANNAPAULA SIZEMORE

• 601 Glenoaks Blvd unit # 400 Burbank CA 91502

• Class A office space : 4500SF

• Rental rate: $8,550.00/Month

• 8 Work stations for workout

• Kids area

• Group Fitness Studio

• Fitness Channels provided by Direct TV

• Security System

• Hours of Operation:

• Monday – Friday 5:00 AM to 11:00 PM

• Saturday 6:00 AM to 9:00 PM

• Sunday 7:00 AM to 8:00 PM

Front Desk Customer Service

Membership Sales

Tours

Packages and Prices

MembershipTrainers

Week Trial

Estimated Monthly Shop Expenses

Salaries and wages $14,320

Employee benefits $2,500

Payroll taxes $2,148

Marketing and advertising $1,376

Property Lease Agreement $8,550

Fitness Equipment (Lease basis) $1,600

Broadcast Service $0

Insurance (Fire, Customer Accidental Property Lost or Damage, etc.) $250

Telephone Service $100

Utilities $300

Office & Cleaning Supplies $50

Gym Maintenance $200

Information Technology $120

Total Expenses $31,514

• Benefits & Incentives

• Recruitment & Retention

• Training & Development

CEO

Operations Manager

JanitorMaster of

Fitness

Trainer

Trainer

Trainer

Customer Service

Market Manager

Advertising

Sales Representative

Finance Manager

Cashier

Accountant

EMPLOYEES

NUMBER

OF

STAFF

MONTHLY

WAGESBENEFITS

PAYROLL

TAXES

Customer Service 2 $3,840 $833 $576

Master Of Fitness 1 $2,500 $417 $250

Trainers 3 7,500 $1250 $1,250

Janitorial 2 480 - $72

Accountant - - - -

Cashier - - - -

Advertising - - - -

Sales Representative - - - -

TOTAL $14,320 $2,500 $2,148

MONTHLY EMPLOYEES

EXPENSES

Electricity

Low/Medium

Network Failure

Medium/Low

Legal

Medium/Medium

Employee Injury High/Medium

Earthquake-High/High

Presenting Financial Plan :

JEFFREY BANKS

FINANCIAL ASSUMPTIONS

Sales

• Upon opening, FitnessConnect will have 4 membership

levels

• We expect to fall inline with the industry growth

expectations of 3%

Financial

• In order to have FitnessConnect ready for business, our

startup costs will be $325,000

START UP FUNDING

$0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000

DUES - IHRSA

LEASE

CERTIFIED TRAINING FOR EMERGANCIES

RENOVATION

GYM EQUIPMENT

PERSONAL TRAINER CERTIFICATION - NASM

BUSINESS FURNITURE

1ST. YEAR'S SALARIES & WAGES

COMPUTERS AND INFORMATION TECH

TOTAL EXPENSES

$550

$8,550

$1,200

$20,000

$85,000

$3,000

$20,000

$171,840

$15,000

$325,140

STARTUP COSTS - FITNESSCONNECT

SALES FORECAST

$-

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

2015 2016 2017 2018 2019

$368,830

$621,976

$866,993

$1,063,736

$1,276,612

PROJECTED SALES

STATEMENT OF CASH FLOW

Cash Flow 2015 2016 2017 2018 2019

TOTAL TOTAL TOTAL TOTAL TOTAL

CASH RECEIPTS

Income from Sales

Cash Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612

Collections $ - $ - $ - $ - $ -

Total Cash from Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612

Income from Financing

Interest Income $ 4,447 $ 5,169 $ 7,044 $ 10,178 $ 17,281

Loan Proceeds $ - $ - $ - $ - $ -

Equity Capital Investments $ 400,000 $ - $ - $ - $ -

Total Cash from Financing $ 404,447 $ 5,169 $ 7,044 $ 10,178 $ 17,281

Other Cash Receipts $ - $ - $ - $ - $ -

TOTAL CASH RECEIPTS $ 773,277 $ 627,144 $ 874,037 $ 1,073,914 $ 1,293,893

CASH DISBURSEMENTS

Operating Expenses $ 479,928 $ 468,059 $ 617,400 $ 658,019 $ 673,506

Capital Purchases $ - $ - $ - $ - $ -

Loan Payments $ - $ - $ - $ - $ -

Income Tax Payments $ - $ - $ - $ - $ -

Investor Dividend Payments $ 40,000 $ 40,000 $ 40,000 $ 40,000 $ 40,000

Owner's Draw $ - $ - $ - $ - $ -

TOTAL CASH DISBURSEMENTS $ 519,928 $ 508,059 $ 657,400 $ 698,019 $ 713,506

NET CASH FLOW $ 253,349 $ 119,085 $ 216,637 $ 375,895 $ 580,386

Opening Cash Balance $ 485,686 $ 587,253 $ 746,286 $ 1,079,165 $ 1,164,966

Cash Receipts $ 39,058 $ 65,953 $ 235,185 $ 289,118 $ 1,293,893

Cash Disbursements $ 71,394 $ 80,772 $ 192,400 $ 203,317 $ 713,506

ENDING CASH BALANCE $ 453,349 $ 572,434 $ 789,071 $ 1,164,966 $ 1,745,352

INCOME STATEMENT

Statement of Income 2015 2016 2017 2018 2019

TOTAL TOTAL TOTAL TOTAL TOTAL

INCOME

Gross Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612

(Commissions) $ - $ - $ - $ - $ -

(Returns and allowances) $ - $ - $ - $ - $ -

Net Sales $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612

(Cost of Goods) $ - $ - $ - $ - $ -

GROSS PROFIT $ 368,830 $ 621,976 $ 866,993 $ 1,063,736 $ 1,276,612

EXPENSES - General and Administrative

Salaries and wages $ 171,840 $ 232,128 $ 256,620 $ 287,403 $ 320,061

Employee benefits $ 30,000 $ 47,250 $ 165,375 $ 173,644 $ 60,775

Payroll taxes $ 25,776 $ 34,819 $ 38,493 $ 43,110 $ 135,758

Marketing and advertising $ 16,512 $ 16,512 $ 16,512 $ 16,512 $ 16,512

Rent $ 102,600 $ 102,600 $ 102,600 $ 102,600 $ 102,600

Fitness Equipment $ 102,600 $ 19,200 $ 19,200 $ 19,200 $ 19,200

Dues and Certification Fees $ 4,800 $ 1,750 $ 4,800 $ 1,750 $ 4,800

Broadcast Services $ - $ - $ - $ - $ -

Office Furniture $ 20,000 $ - $ - $ - $ -

Insurance $ 3,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000

Telephone service $ 1,200 $ 1,200 $ 1,200 $ 1,200 $ 1,200

Utilities $ 3,600 $ 3,600 $ 3,600 $ 3,600 $ 3,600

Office supplies $ 600 $ 600 $ 600 $ 600 $ 600

Gym Maintenance $ 2,400 $ 2,400 $ 2,400 $ 2,400 $ 2,400

Information Technologies $ 15,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000

TOTAL EXPENSES $ 499,928 $ 468,059 $ 617,400 $ 658,019 $ 673,506

Net income before taxes $ (131,098) $ 153,916 $ 249,593 $ 405,717 $ 603,106

Provision for taxes on income $ - $ 43,097 $ 69,886 $ 113,601 $ 168,870

NET PROFIT $ (131,098) $ 110,820 $ 179,707 $ 292,116 $ 434,236

FIVE YEAR BALANCE SHEET

Balance Sheet

FitnessConnect

2015 2016 2017 2018 2019

ASSETS

Current Assets

Cash $453,349 $573,434 $789,071 $1,164,966 $1,745,352

Accounts Receivable $0 $0 $0 $0 $0

Other Current Assets $0 $0 $0 $0 $0

Total Current Assets $453,349 $573,434 $789,071 $1,164,966 $1,745,352

Fixed Assets

Facilities $0 $0 $0 $0 $0

Equipment $102,600 $102,600 $102,600 $102,600 $102,600

Computers & Technologies $0 $0 $0 $0 $0

Office Furniture $20,000 $20,000 $20,000 $20,000 $20,000

Total Fixed Assets $122,600 $122,600 $122,600 $122,600 $122,600

Other Assets $0 $0 $0 $0 $0

TOTAL ASSETS $575,949 $695,034 $911,671 $1,287,566 $1,867,952

LIABILITIES

Current Liabilities

Short-Term Notes Payable $0 $0 $0 $0 $0

Income Taxes Due $0 $43,097 $112,983 $226,583 $395,453

Other Current Liabilities $0 $0 $0 $0 $0

Total Current Liabilities $0 $43,097 $112,983 $226,583 $395,453

Long-Term Liabilities

Long-Term Notes Payable $0 $0 $0 $0 $0

Other Long-Term Liabilities $0 $0 $0 $0 $0

Total Long-Term Liabilities $0 $0 $0 $0 $0

NET WORTH

Paid-In Capital $600,000 $600,000 $600,000 $600,000 $600,000

Retained Earnings ($24,051) $51,938 $198,688 $460,983 $872,500

Total Net Worth $575,949 $651,938 $798,688 $1,060,983 $1,472,500

TOTAL LIABILITIES AND NET WORTH $575,949 $695,034 $911,671 $1,287,566 $1,867,952

BREAK-EVEN ANALYSIS

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

$180,000

Oct-

14

Nov-1

4

Dec-1

4

Jan-1

5

Feb

-1

5

Mar-

15

Apr-

15

May-15

Jun-15

Jul-

15

Aug-15

Sep

-1

5

Oct-

15

Nov-1

5

Dec-1

5

Jan-1

6

Feb

-1

6

SALES

EXPENSES

VALUATION

Gordon Model Approach

• At the end of year five, the business is projected to have

a value over $4.8 million dollars.

Asset Valuation Approach

• Under the Asset Valuation approach, business value at

the end of year five is $1.9 million dollars.

TERMS OF PAYBACK

For the investor: The management team has projected that at

the end of year 5, a return on investment of 41%

In the below chart will also show other key ratios for the first 5 years.

Key Ratios

Year 1 (2015-2016)

Working

Capital Current Ratio Quick Ratio

Cash

Turnover

Debt to

Equity

Return on

Investment

Return on

Sales

Return on

Assets

1st Quarter $481,547 N.A. N.A. 0.16 0.00 -30% -179% -30%

2nd Quarter $476,224 N.A. N.A. 0.18 0.00 -1% -7% -1%

3rd Quarter $477,471 2,612.82 2,612.82 0.20 0.00 0% 0% 0%

4th Quarter $453,349 N.A. N.A. 0.24 0.00 3% 13% 3%

Year 2 (2016-2017) $529,338 13.28 13.28 1.18 0.07 24% 25% 22%

Year 3 (2017-2018) $676,088 6.98 6.98 1.28 0.14 31% 29% 27%

Year 4 (2018-2019) $938,383 5.14 5.14 1.13 0.21 38% 38% 32%

Year 5 (2019-2020) $1,349,900 4.41 4.41 0.95 0.27 41% 47% 32%

EXIT STRATEGY

We offer you a choice at the end of year five:

• We can provide a cash buyout of your investment with a

30%plus over principal along with your end of year annual

investment interest payment.

• The second choice is to bring you onboard as a silent

partner as we would gear up to open a second location in

the Southern California area.

ANY QUESTIONS ?