Znak it! investor deck june 2013
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Transcript of Znak it! investor deck june 2013
![Page 1: Znak it! investor deck june 2013](https://reader033.fdocuments.in/reader033/viewer/2022052820/54bd3b714a7959e0128b45be/html5/thumbnails/1.jpg)
Copyright (C) 2009 by Znak, Inc. 1
“Information wants to be free, and it wants to be expensive.”
the WWW as a marketplace; not a billboard or soc net;
Fair to everyone;
Based on the natural dynamics of free market
Solves the old dilemma:
Disruptive Monetization & Payment Pathways for Creative Content, Virtual Goods and Services
Make the WWW free Fair
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Copyright (C) 2009 by Znak, Inc.
Billboard
Social Net
Marketplace
The WWW Evolves
2
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Copyright (C) 2009 by Znak, Inc.
Paid Content Ecosystem
3
http://imgur.com/qjjlkGm
Three proven solutions in one
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Copyright (C) 2009 by Znak, Inc.
Three Major Stakeholders
premium content curation and monetization platform
frictionless access to paid content, also for “free”
direct-to-user advertising opportunity & a data collection toolMarketers &
Advertisers
Content Providers
Web Users
4
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Copyright (C) 2009 by Znak, Inc.
Links and widgets, embeddable as payment gateways.
Customizable shapes/colors.
Easy, copy-and-paste insertion of JS codes or API.
Two mouse clicks to access and pay for selected content.
Real time payment authorization & fund transfer; SSL-encrypted; CPI-compliant.
5
Content Providers, Large & Small
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Copyright (C) 2009 by Znak, Inc.
User Choice
6
Purchase subscription; (micro)pay on demand, make a donation, or
Earn Free Access through opt-in advertising
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Copyright (C) 2009 by Znak, Inc.
Award-winning “Earn Free Access”
7
No registration needed!
No PINs! No User IDs – quick, safe and private
High (19.6%) conversion rate (vs. 1-2% conversion by paywalls)
Ability to bypass in-app payment fees charged by Apple, Google, etc. Up to 30%
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Copyright (C) 2009 by Znak, Inc.
A Win-Win-AND-Win Solution
8
Open – platform agnostic;
Flexible – multiple payment methods;
Universal – any type/format of premium content or service;
Simple to implement (SaaS) and use; frictionless for the Web user;
Efficient and viable – up to 20% conversion; 94% return.
Marketers & Advertisers
Solves the Brand Dilemma – makes the WWW a marketplace, fair and beneficial to everyone
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Copyright (C) 2009 by Znak, Inc. 9 /
Market Potential and Trends
Market SizeUSD 2 700 000 000 000
40 times bigger than Apple’s annual revenue;
90 times Google
1,350 times bigger than Facebook
Source: ZenithOptimedia ; est . for 2015
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Copyright (C) 2009 by Znak, Inc. 10
1/5 of online content is paid now – 139% increase
By 2016, 90% of online content will be paid.
Simon-Kucher & Partners
Online Revenue Growth
Internet
Offline Publishing
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Copyright (C) 2009 by Znak, Inc.
From Public Beta to BEP
11
Aug. 2011
2011
2012
2012
320 content providers, 55,,000 users, in the first 3 months
Pilot projects with5 large publishers
Developed in 2007-08 with
200,000 users, 1.4M EUR volume
Five additional publishers, LoI
Q1 2013
2010 2011 2012 -
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
361 8,095
110,240 80,968
109,230
159,470
Revenue from Commision Exspenses/ Cost of Goods
Beta
Ask me about results!
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Copyright (C) 2009 by Znak, Inc. 12
Competition
Google e-Wallet
PayPal Press+Piano
TinyPass
Flattr Znak it!
Off line
On line
Subscription
Micropayments
Donations
Earn Free Access
Transferable Credits
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Copyright (C) 2009 by Znak, Inc.
Business Model Options & Benefits
Paywalls vs. Znak it! SaaS -- no setup and system maintenance
costs; up to 94% return; can bypass app fees;
Also for the “long tail;” truly World Wide;
Technology- and portal-agnostic; Flexible, a la carte, on-demand access;
Supports different payment methods, incl. donations and ad-sponsored access;
User-centric, payment as social engagement, content sharing & P2P recommendations;
Private, intrinsically safe; can be used for anonymous access – without registration; frictionless.
13
Expensive, low ROI;
Require large scale; convert only about 1% of users
Create ‘silo effect;’
Closed, rigid, might cannibalize other sources of revenue;
Media/publisher-centric , not engaging ; “exploit” most loyal users
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Copyright (C) 2009 by Znak, Inc.
Major Clients and Partners
14 /
Existing Clients Partners Prospects with LoI
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Copyright (C) 2009 by Znak, Inc. 15
2008
2009
2010
2011
Web 2.0 Expo in San Francisco – first public show
German Publishers’ Assoc. Award
Developed in 2007-08 with Developed in 2007-08 in collaboration withIdeo of Palo Alto, CA
EU Grant for Innovation167,000 EUR
EPCA Florin Award
Public BetaLaunched
Aug. 2011
Barriers to Entry
IP – patent pending
CPI–SSD compliance
Industry standards
Learning curve
Scale
Sunk costs
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Copyright (C) 2009 by Znak, Inc.
Znak it! Finances in EUR
16 /
2009 2010 2011 2012 2013 -
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
Seed & Angel Capital
Revenue from Commision
Operational Exspenses
Estimated
900,000 EUR Invested
Does not include the new round.
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Copyright (C) 2009 by Znak, Inc.
Financial Projections
17
2010 2011 2012 2013
Revenue from Commision 360.5 8095 110240 746000
Exspenses/ Cost of Goods 80967.5 109230 159470 185000
50,000
150,000
250,000
350,000
450,000
550,000
650,000
750,000
With 1,500,000 EUR of additional capital:
FY 2014 Projected Revenue – 3,035,000 EUR; EBITDA – 660,000 EUR
FY 2015 Projected Revenue -- 10,275,000 EUR; EBITDA – 3,075,000 EUR
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Copyright (C) 2009 by Znak, Inc.
Needs and Opportunities
18
1,500,000 EUR -- Series A, equity, convertable
Mobile apps
Sales & marketing
Administration, new hires
Working capi-tal
New Capital Allocation
ROI – open to IPO with additional rounds, M&A or licensing
Excellent perspective: average multiple of 4.9 x revenue, as reported by Berkery Noyes, (based on 60 M&A deals in 2012)
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Copyright (C) 2009 by Znak, Inc. 19
With Znak it! information can be “free,” easy to access and share; AND, it can be “expensive,” high-quality and profitable.
Enormous opportunity ; huge marketplace;
Fair and beneficial to everyone;
Customer is King
Business model driven by the real market dynamics
Disruptive Monetization & Payment Pathways for Premium Content
Let’s Make the WWW free Fair!
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AppendixPilot Study Results
Znak, Inc . Sunnyvale CA, USA
Warsaw, Poland
20
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Copyright (C) 2009 by Znak, Inc. 21
User Characteristics, by Gender & Age
58.9%
41.1% Males Females
13.8%
16.5%
23.1%
22.4%
24.2%
18 to 24
25 to34
35 to 44
45 to 54
55+
Based on a sample of 43 299 Unique Users – Pilot Project Results
The sample represents gender and age distribution typical for online sites with high-quality news/magazine content, with a majority of users being male and older.
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Copyright (C) 2009 by Znak, Inc. 22
Males Females 18 - 24 25 - 34 35 - 44 45 - 54 55+
58.9%
41.1%
13.8% 16.5%23.1%
22.4%
24.2%
65.3%
34.7%
20.6%
29.0%
21.0%16.5%
12.9%
Unique Users Unique Buyers
Number of Unique Buyers – 1 281
Younger users more likely to convert into Buyers, using Znak it!
Znak it! vs. paywalls – sustainable, viable system
User Characteristics, by Gender & Age
50% under 34 yrs old
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Copyright (C) 2009 by Znak, Inc.
Conversion Rates by Gender and Age
23
Total Males Females 18 - 24 25 - 34 35 - 44 45 - 54 55+
3.0% 3.3%2.5%
4.4% 5.2%
2.7%2.2%
1.6%
8.7%10.3%
6.4%
14.5%15.6%
8.2%
6.3%
3.3%
Conversion Rate (Buyers/Uniques) Conversion Rate (Buys/Uniques)
Conversion rates 9 to over 15 times higher than those generated by metered pay-walls (1 - 2%)
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Copyright (C) 2009 by Znak, Inc.
Znak it! Market Niche
Znak it! Payment Niche
24
0%
20%
40%
60%
80%
100%
120%
6.00%3.90%
0.216666666666667
0.0884615384615385
1.02899999999999
0.529
0.279
0.179
0.0540000000000004
Per
cen
tag
e C
om
mis
sio
n
Znak it! standard commission as compared to PayPal charges
Transaction value
PayPal Regular
Znak it!
PayPal Micropayments