Empowering the next generation of builders

Empowering the next generation of builders
Build-It-Yourself seeks partners who can help bring our unique online learning environment direct to kids and their parents at home. Build-It-Yourself has developed a popular, highly valued, art and engineering, after-school program, driven by technology-in-education research at MIT. We target 12 million boys and girls 8 – 13 in the after-school, USA market. In the next few slides, we will outline our plan to grow from 500 customers to 100,000+ customers generating annual revenue of $50M+. John Galinato Empowering the next generation of builders

What We Do … Inspire and guide kids to create, design, build and invent. Our mission is to inspire and guide kids to use technology constructively and creatively.. We engage boys and girls 8-13 in playful approaches to design, invention and scientific inquiry. Our program trains kids to apply technology to solve problems in engaging ways. Empowering the next generation of builders

The Product Content Specialists Collaboration Mission: Inspire and guide kids to use technology constructively, collaboratively and creatively. What we offer: A unique, online laboratory for builders Parents pay a $30/mo. membership fee: Access to project plans, modules Four live, mentored Webcast lessons/mo. Invention Universe online virtual community Our unique, online laboratory for builders includes: Multimedia content that aids and guides kids to build playful, engaging projects. Collaboration tools that enable members to build with our network of art and engineering specialists. A virtual community for creating a project portfolio and interacting with other builders. Empowering the next generation of builders

Product Differentiators Multi-discipline - Playful, socially conscious storylines - Combine art and technology - Attract broad range of kids 2) Build-It-Blocks (modular construction) - Build complex projects quickly 3) Collaboration with art and engineering students (live webcasts) - Build mentor relationships 4) Invention Universe - Show off portfolio of projects Our unique, online laboratory for builders includes: Multimedia content that aids and guides kids to build playful, engaging projects. Collaboration tools that enable members to build with our network of art and engineering specialists. A virtual community for creating a project portfolio and interacting with other builders. Empowering the next generation of builders

Value Proposition We provide consistent, high-quality, high value technology enrichment at a fraction of the cost of traditional instruction. We bring the university student TA (Teaching Assistant) concept, coupled with proven content and online collaboration tools, to kids online. Our value proposition: We provide high quality, high value technology instruction at very low cost. We can do this because we use Internet collaboration tools, proven content and a network of model college student TA’s at $10-$12 / hour. Empowering the next generation of builders

Target Customers Boys and girls ages 8-13 interested in art or technology. Parents who want their kids to go to college and understand the need to be fluent in technology. Skills exercised in a BIY workshop series: 1) Problem solving skills 2) Presentation skills We target kids who are on a college track and their parents. Our message is that: art and technology can be fun and technology and presentation skills are valuable life skills. Our market strategy: Develop a viral marketing program. Close corporate distribution partnerships. Empowering the next generation of builders

Growth Plan Rollout $50M+ revenue 150,000+ members 3-4 years Proof of Execution 1,000+ members 2018 Proof of Concept $600K+ revenue 3000+ customers Thru 2016 We believe we are poised to grow quickly. Every kid on a college track must be fluent in technology. There are roughly 12 million kids in the USA alone between ages 8 – 13 who will go to college. 150,000 members (or 1.25% of our target market) at $30/mo will generate revenue of $50M+. Grow the team and infrastructure to serve 1,000+ members Partner with after school programs like Sylvan, Kaplan and Bright Horizons, publishers and retail outlets to grow quickly. Validate that parents value the Build-It-Yourself vision. Empowering the next generation of builders

Proof of Concept Phase – Validation 4,000+ customers / 20+ schools $200+ revenue per customer $1M+ revenue 10+ years in development 90% of business is recurring 20% of revenue is on-line. In the Proof of Concept Phase: We have good evidence that parents will pay top dollar for our program. Empowering the next generation of builders

Proof of Concept Phase - Validation Proven content and supporting platforms 30 Projects 20 Lessons 100 Build-It-Blocks Record of attracting talent from the Cornell, MIT, Harvard and Mass Art communities. In the Proof of Concept Phase: We have developed and consistently delivered kid-tested content. We have developed and refined effective workshop delivery platforms. We have established connections and a strong history of attracting top technology coaching talent. Empowering the next generation of builders

Proof of Execution Phase Raise our valuation Strategy: Hire an MBA business developer. Evolve our content and supporting platforms. 3. Close corporate distribution partnerships. Assets: Repeat customer base. (500 kids/yr. at $200/kid) Well-tested content and supporting platforms. Access to network of developers and Webcast specialists from Cornell, Mass Art and MIT communities. Our business goal in the Proof of Execution phase is to raise our valuation. Our strategy is to: hire a business developer to eventually lead our company, evolve video content and Invention Universe features, increase our customer base from 500 to members. Empowering the next generation of builders

Viral Marketing Program: 12 interns 10 developers 15+ schools
Proof of Execution Phase - Serve 1,000 members Viral Marketing Program: 12 interns 10 developers 15+ schools 500 students / year Network of specialists Corporate Partnerships: Close a corporate distribution partnership that has the potential to generate 3,000 members in a year. (300K $240/year in 3-5 years) We are in the process of growing our online customer base to 300,000 paying members. To do this we need to execute an online viral marketing program.

We need to recruit an MBA deal maker.
Proof of Execution Phase - Serve 1,000 members The Team: We need to recruit, train and manage a network of 30 Webcast specialists. We need to recruit an MBA deal maker. Infrastructure: We need to automate and expand our infrastructure. To grow, we need to expand our team.

We need 2% of target US market to build a $72M business.
How big is our market? College bound Kids: Every kid who goes to college should be technology fluent and therefore is a potential customer. 300K Members: We need 2% of target US market to build a $72M business. (300K x $240/yr including supplies and embedded advertising) 30 million kids ages 15 million target market. Half will go to college. 62% have broadband access at home. Every kid on a college track must be fluent in technology. There are roughly 12 million kids in the USA alone between ages 8 – 13 who will go to college. If we can capture 300,000 members or 2.5% of our target market, we will have a $50 million business. Empowering the next generation of builders

Rollout Phase - Serve 300,000 members
(Build-It-Yourself) (Partners) (Retail) Build-It-Yourself sells content branding to highly targeted strategic partners including publishers, after school programs manufacturers and distributors. 1 to 4 Leverage Strategic partners place highly valued content in retail outlets such as Home Depot, Radio Shack, Sylvan Learning Centers, Barnes & Nobel. 4 to 5,000 Leverage Retail outlets promote Build-It-Yourself memberships because they drive sales of their products, encourage family shopping and monetize their on-line presence. 5,000 to 300,000 Leverage OUR DISTRIBUTION PLAN IS HIGHLY LEVERAGED. We will develop a few corporate strategic partners including publishers like McGraw Hill and distributors like Radio Shack and Home Depot to distribute low cost printed project plans to the school and home markets. They will do this because the content is popular and the program will drive sales of their products. School systems and distributors will encourage kids to become members of Build-It-Yourself at $8/mo (similar to the cost to join a multiplayer game community.) Schools will do this because our program compliments their academic curriculum and disciplines kids to think constructively. Our aim is to get 30,000 members in 3 years and 200,000 members in 5 years.

Rollout Phase - Serve 300,000 members $72M annual revenue (300,000 members x $20/mo) Investment of $1.5+ million may be required to: grow the team brand the product evolve the product and infrastructure develop distribution partnerships After we complete our Proof of Execution Phase, we anticipate needing a significant investment to grow to 300,000 members. John Galinato Empowering the next generation of builders

Business Plan Support Slides What We Do Product Development Market Segmentation Value Net Benchmarks Financials Team Comps Business Plan Support Slides Empowering the next generation of builders

What We Do … Build-It-Yourself provides after-school and at-home workshops that inspire and empower kids to create, design, build and invent. We engage boys and girls in playful approaches to design, invention and scientific inquiry. We train kids to apply technology to solve problems. Our mission is to inspire and guide kids to use technology constructively and creatively.. We engage boys and girls 8-13 in playful approaches to design, invention and scientific inquiry. Our program trains kids to apply technology to solve problems in engaging ways. Empowering the next generation of builders

Our Workshops Are In Demand Key Statistics Validation More than 16 schools served: 85% are repeat customers Include BB&N, Concord Academy, Lawrence Academy Growth via word-of-mouth More than 2,500 kids served More than $500K revenue generated “Clio was thrilled. She couldn't stop talking about what she did.” Parent “I never thought my son would give up soccer for anything.” “Wow!” Program director sitting in on a webcast from China. OUR PROOF POINTS ARE MANY. From parents and program directors … Empowering the next generation of builders

The Product – Invention Universe Database of Content Elements: Online database of: Playful storylines and associated challenges Building tricks and lessons Functional building blocks that enable kids to build complex projects quickly. Content Specialists Collaboration Tools OUR PRODUCT HAS 3 COMPONENTS Component 1: Build-It-Yourself has developed content and supporting platforms in collaboration with MIT. This includes a series of playful storylines around relevant social issues followed by challenges to use technology to help solve problems. Our content includes an online data base of documentation on functional building blocks. (Show examples) Over 288,000 of these modules have been built from our documentation. This development effort was largely funded by the MIT Media Lab. These building blocks (or subroutines) enable kids to build complex solutions quickly and efficiently. And finally, our content includes lesson plans and a series of short Power Point 'how to' presentations... Our content is popular and it's well tested. Empowering the next generation of builders

The Product – Invention Universe Content Specialists Collaboration Tools The 2nd component: Our network of specialists includes $10/hour students from Harvard and MIT, an engineer IN China and a science journalist IN Argentina and a junior at Choate. Seth Mastin – BA Computer Science, MIT Rebekah Gendron – MEd, Rhode Island Univ Max Seidman – Sophomore BB&N Valeria Roman – Science Journalist, Argentina Naseem Makiya – Junior Harvard Michael Hsu – Sophomore, Choate Liu Huan – Senior, Shanghai High School Joan Tarud – MS Mechanical Engineering, MIT Network of Specialists: Graduates and students from the Cornell/Harvard/MIT community who inspire and guide kids. Empowering the next generation of builders

The Product – Invention Universe Effective Collaboration Tools: 2-way audio/video webcast platform enables kids to collaborate with peers and specialists in a global laboratory. Wiki project management Invention Universe Content Specialists Collaboration Tools And the 3rd component: These specialists collaborate with kids where ever they are; at home, at school or in gatherings via a live, 2-way audio/video webcast system. Empowering the next generation of builders

Product Differentiators 1) Multidiscipline - Attract broad range of kids 2) Build-It-Blocks (modular construction) - Build complex projects quickly 3) Collaboration with art and engineering students - Build mentor relationships 4) Focus on the presentation of ideas - Kids get positive feedback when their projects look cool. Content Specialists Collaboration HOW IS BUILD-IT-YOURSELF DIFFERENT? 1) It appeals to a broad range of kids because it is playful and mixes many disciplines. Technology is applied to a broad range of kids' interests and social issues in a playful way. Build-It-Yourself is a unique integration of technology with whimsical storylines, art, games, and social collaboration. 2) A database of functional building blocks enables kids to build engaging solutions quickly. The Build-It-Yourself database of construction modules encourages kids to break down complex solutions into simple, reusable, functional building blocks. A database of construction modules minimizes mentor time spent on repetitive, basic concepts and maximizes valuable mentor time focused on individual questions and solutions. 3) Kids can collaborate with specialists online. Experienced, inspiring, specialists, (many from MIT and Harvard) collaborate with kids, parents and teachers via live Webcasts. ($10/hr for babysitter, $10-$20/hr for camp or after school program, $10/hr for public school, $50/hr for private teacher.) If a member pays $10/mo and does a 1hr workshop each weekend, the cost is $2.50/hr for live collaboration. In addition members get access to on demand content and web space to post projects. 4) Build-It-Yourself projects are creative and artistic. The Build-It-Yourself program focuses on the presentation of ideas as much as on the execution of ideas. Each project is presented on the Web. The result ... kids build confidence because their projects look good, win positive feedback and are accessible to a global audience. Empowering the next generation of builders

Value Proposition High-quality technology instruction at a fraction of the cost of traditional instruction. Large and growing demand for technology training and constructive, after-school activities. Collaboration with MIT. Proven and acclaimed content. Unique workshop delivery model. Access to Cornell/MIT student specialists. Project has attracted talented developers. Specialists from the Harvard/MIT community use a live Webcast platform to deliver consistent, high-quality, engaging instruction at less than half the cost of public school or after-school instruction. Empowering the next generation of builders

Value Proposition High-quality technology instruction at a fraction of the cost of traditional instruction. Bring the university student TA (Teaching Assistant) concept coupled with proven content and online collaboration tools to kids online. Our value proposition is that we offer high quality, high value technology instruction at very low cost. We can do this because we use Internet collaboration tools, proven content and a pool of model college student TA’s at $10-$12 / hour. Empowering the next generation of builders

Proof of Concept Phase Validation
"The goal is to highlight the 'powerful ideas' in the modules -- that is, the ideas that help you understand how the module works, and provide you with a foundation for building other things." Professor Mitchel Resnick, from the MIT Media Lab, directing the collaboration between MIT and Build-It-Yourself to develop a database of construction modules "Build-It-Yourself is a fascinating program that engages students in creative projects to design and build robots. Both of my children --ages 7 and 9-- have participated in Build-It-Yourself workshops and learned greatly from it. It's very interesting pedagogy." Dr. Fernando Reimers, Associate Professor and Director of HGSE's International Education Policy program, describing the Build-It-Yourself program to colleagues at the Harvard Graduate School of Education "Thanks for putting on one of the best Robotics workshops that I have been to." Science teacher at the Jamestown Middle School, RI commenting on a Build-It-Yourself workshop for teachers OUR PROOF POINTS ARE MANY To educators

Collaborating on-line comes naturally to the next generation!
Proof of Concept Phase Validation Collaborating on-line comes naturally to the next generation! OUR PROOF POINTS ARE MANY And students Noah in Boston, Robert and Jonathan in Seattle are webcasting to Liu Huan in Shanghai. The teacher in this inner-city class room could only wish that his students would pay as much attention to him as to the Webcaster. Roland at the Greater Lawrence Technical School is collaborating with Liu Huan in Shanghai … “How are the girls in China?” Empowering the next generation of builders

Proof of Concept Phase Assets Proven content and supporting platforms 30 Projects 20 Lessons 100 Build-It-Blocks Record of attracting talent from the Cornell, MIT, Harvard and Mass Art communities. (24 contractors) In the Proof of Concept Phase: We have pretty good evidence that parents will pay top dollar for our program. Empowering the next generation of builders

Market Segments Opportunity: Summer Camps 7.3 Million Kids
2. After-school Time Organized by schools 2.5 Million Kids 3. After-school Time Organized by families 15 Million Kids 23 Million Kids Grades 3 to 8 @ Home Public After-school Private School Commercial After-school Public School Private After-school Summer Camps 12,000 Camps 7.3M Kids 26,569 Schools 3M Kids 450K Kids (15%) 71,270 Schools 20M `Kids 2M kids (10%) 5 largest for-profit organizations 160K Kids MARKET SEGMENTATION The low hanging fruit are summer camps. 7.3 million kids paying >$10/hr accessible through 12,000 camps. Followed by after school programs run by volunteer parents, paid teachers. 2.5 million kids paying $10/hr accessible through 97,000 schools. The holy grail market segment Our challenge is to find efficient ways to seed viral marketing to families. Assume 65% of kids can afford a computer and $120/year 15M Kids Sources: American Camp Association Institute for Educational Science, US Dept. of Education Digest of Education Statistics: 2005

Build-It-Yourself The Value Net Customers: Summer Camps
After-school programs Parents Competitors: Teachers Local Museums Mad Science Bright Horizons Complementors: Publishers Manufacturers Retail Outlets Schools Build-It-Yourself THE VALUE NET: In the next few slides, we will profile, segment and quantify our customers Build-It-Yourself sells: A series of five 5-hour Webcast workshops to summer camp directors. A series of ten 1-hour Webcast workshops to after school program directors. On-line memberships to parents and their kids Suppliers: Marratech / Google Craft Stores Radio Shack

The Demand Factors Kids Parents Corporations 1) Kids seek rich, online experiences. 2) Two-thirds of U.S. families are now headed by either two working parents or a single working parent. These families need after-school programs. 3) Many parents want to position kids to get into good schools. 4) Corporations are demanding a labor pool that is better trained in engineering and technology. OUR CUSTOMERS ARE DEMANDING PROGRAMS LIKE BUILD-IT-YOURSELF 1) Many kids are hooked on computer activities. 2) Many working families need after-school care. 3) Many parents want their kids to go to college. 4) Corporations need a work force that is technology savvy. Summer camp and after-school program directors seek activities that address these demand factors. Empowering the next generation of builders

Customer Profiles Camp Directors Camp Directors seek popular programs. 7.3 million kids attend 12,000 summer camps. After-School Program Directors After-school Program Directors seek educational programs. 3 million kids are enrolled in after-school enrichment programs. Parents Parents seek engaging, constructive activities for their kids when not in school. WHO ARE OUR CUSTOMERS? Summer Camp Directors: During the summer, many schools contract with camp directors to run programs that return money to the school. Parents typically pay $10/hr+ for summer camp programs. Camps compete aggressively by establishing unique programs. After-school Program Directors: During the school year, enrichment programs tend to be run by volunteer parents, teachers or outside organizations. There is a built-in, fixed customer base. These enrichment programs are often run to break even. Parents typically pay $10/hr for after-school enrichment programs. Build-It-Yourself will offer incentives for after-school and summer camp programs to seed programs. Parents: Parents who want their kids to go to college or get well-paying jobs are the primary customers for programs. More than 70% of students will go to college. Getting into top schools is competitive. Parents invest in equipment and programs including computers, sports, music and art to ensure their kids have well rounded college (or job) applications. Sources: American Camp Association Institute for Educational Science, US Dept. of Education Digest of Education Statistics: 2005 Empowering the next generation of builders

After-school programs Parents Competitors: Teachers Local Museums Mad Science Bright Horizons Complementors: Publishers Manufacturers Retail Outlets Schools Build-It-Yourself THE VALUE NET: In a broad sense, competitors include all programs and activities that compete for after-school time and disposable income including sports leagues, museum programs, computer games and social web sites. We will focus on organizations that offer technology instruction after school including: US First Mad Science Childrens Technology Workshop Robotech Suppliers: Marratech / Google Craft Stores Radio Shack

After-School Enrichment Competitors
Cost $25-$50/hr Private Tutors Build-It-Yourself Interns $35/hr ID Tech Camps Local Museums Mad Science $10-$25/hr Invent Now Kids Sports Programs COMPETITORS ARE HIGHLY FRAGMENTED Franchise organizations such as Mad Science and Children’s Technology Workshops offer their services to summer camps and after-school programs. The majority of the market is served by local operations such as Robotech and museums and individuals who teach after-school technology programs. First LEGO Build-It-Yourself Members $5/hr $5/hr Consistent Quality (Control over content + instructor)

Technology Program Competitors
COMPETITORS ARE HIGHLY FRAGMENTED Franchise organizations such as Mad Science and Children’s Technology Workshops offer their services to summer camps and after-school programs. The majority of the market is served by local operations such as Robotech and museums and individuals who teach after-school technology programs.

Competitive Web Sites COMPETITORS ARE HIGHLY FRAGMENTED
Franchise organizations such as Mad Science and Children’s Technology Workshops offer their services to summer camps and after-school programs. The majority of the market is served by local operations such as Robotech and museums and individuals who teach after-school technology programs.

After-school programs Parents Competitors: Teachers Local Museums Mad Science Bright Horizons Complementors: Publishers Manufacturers Retail Outlets Schools Build-It-Yourself THE VALUE NET: In the next few slides we will focus on partnerships that will enable us to leverage: Distribution. Fulfillment. Infrastructure. Suppliers: Marratech / Google Craft Stores Radio Shack

Potential Distribution Partners
Publishers After-school Programs Retailers Manufacturers iRobot Mad Science Build-A-Bear Penquin Sunset STRATEGIC PARTNERS => EXIT STRATEBY We will work closely with distribution partners like these to grow our business. Our exit strategy is to position ourselves as an attractive acquisition. Add value to products. Drive new product development. Sell products. Monetize web presence. Expand curriculum. Generate new revenue. Monetize web presence.

Potential Distribution Corporate Partners After School Service Providers Sylvan Kaplan Bright Horizons Mad Science Build-A-Bear Publishers McGraw Hill Houghton Mifflin Penguin Sunset Marvel Comics Electronic Arts Retailers Radio Shack Home Depot Walmart Manufacturers Microsoft Xbox Nintendo Wii MidWest Hobbies Futaba After we complete our Proof of Execution Phase, we anticipate needing a significant investment to grow to 300,000 members. Empowering the next generation of builders

Everyone Wins in the Build-It-Yourself Eco-system Parents - See their kids engaged and excited! - Collaborate and work with their kids. Kids Corporate Partners - Have fun! - Solve problems creatively. - Integrate multiple disciplines. - Reinforce core curricula. - Collaborate and share ideas. - Develop important tech skills. - Deliver high-quality programs. Reach kids and parents at-home. Develop new revenue streams. Differentiate. Develop future employees. Affiliate with a “do-good” program. EVERYONE WINS IN THE BUILD-IT-YOURSELF ECO-SYSTEM!!! Boys and girls develop personal confidence in their intellect and skills, and become life-long builders. Parents see their kids on a promising track to the future. After school programs get a consistent, high-quality, high-value activity. Corporations feed their future employee pipeline with passionate builders and technologists. Investors - Receive an attractive ROI. - Help solve a major social problem. Empowering the next generation of builders

Scaling to a Global Market Current Model Going Forward Model On-site Fee per workshop In-person specialists Word-of-mouth distribution New England area On-line Subscription based revenue On-line specialists Distribution partnerships National and international OUR PLAN TO SCALE Our next step is to grow our success story. Empowering the next generation of builders

Growth Phases - Milestones
Proof of Concept Phase Proof of Execution Phase Roll Out Strategic 2,500+ students paid $200+ for BIY workshops. ($10-$20/hr) Secure $100K investment. Grow from 50 on-line customers to 3,000 online $10/mo. Grow from 3,000 online members to 300,000 online members. Show profitability. Infrastructure Content and supporting online platforms developed. Collaboration tools tested. Development team recruited. Develop Invention Universe to serve 3000 members. Develop program to recruit, train and manage webcasters in university communities. Expand content. Automate member support. Distribution Strong testimonials and repeat customer relationships built. Initiate viral marketing program. Close corporate distribution partnership > $50K Multiple distribution deals in place. Goals: 1) Serve 3,000 members at $10/month 2) Close a distribution deal greater than $50K 3) Get a letter of intent to invest if we meet Execution Phase goals. Tasks: Hire an MBA to run BIY. Develop a viral marketing campaign to capture 3000 members. Develop Invention Universe to support 3000 members. Develop a program to recruit, train and manage Webcasters in university communities. 41 41

Proof of Execution Phase Strategy / Assets Strategy: 1. Hire and MBA business developer to lead the company. 2. Close a corporate distribution partnership that has the potential to generate 3,000 members in a year. (300K $240/year in 3-5 years) Assets (2012): Repeat customer base (500 kids/yr at $200/kid.) Content and supporting platforms. Access to network of developers and Webcast specialists from Cornell, Mass Art and MIT communities Every kid on a college track must be fluent in technology. There are roughly 12 million kids in the USA alone between ages 8 – 13 who will go to college. If we can capture 300,000 members or 2.5% of our target market, we will have a $50 million business. Empowering the next generation of builders

Proof of Execution Phase - Serve 3,000 members
This spread sheet outlines our financial plan to grow to 3,000 members.

Proof of Execution Phase - Serve 3,000 members Our business model will be highly profitable when it is scaled. Our worst cast cash flow is $91K in month 10. . $91K - Worst case cash flow Empowering the next generation of builders

Worst case cash flow: ($91K) Break even: Month 10
Proof of Execution Phase - Serve 3,000 members Revenue $156K - Online rev $84K - Onsite rev $72K Expense: $239K -Fixed cost $204K -Webcast cost $ 35K Worst case cash flow: ($91K) Break even: Month 10 Capital Required $105K To grow from $15K => $360K annualized online revenue. In summary, we need capital of $115K to cover our worst case cash flow. In month 11, we will be profitable.

5-year Target: 300,000 customers => $79M revenue
Rollout Phase - Financials 5-year Target: 300,000 customers => $79M revenue FINANCIALS In year 3, we project 30,000 members. Each member generates revenue of $200/yr. That's a $6M annual revenue rate at month 36. The cost to generate this revenue including $3M for labor and $1M for customer acquisition yields a 22% Earnings to Revenue ratio. In 5 years we believe it is possible to sign up 200,000 members (or just 1% of the target market) generating revenue of $44M.

Rollout Phase - Financial Assumptions
1) Sales: There are 6 revenue streams: 1. Online memberships are the largest revenue stream. 2. Printed pieces in POS displays drive online memberships. 3. Workshops in after school programs drive online memberships. 4. Ecommerce results from projects that require parts, tools and supplies. 5. Advertising revenue results from website traffic. 1/2 of members are repeat customers or from a % conversion from printed pieces that are placed in schools, store counters and book stores. ($0 acquisition cost) 1/2 of members will come from effective, leveraged, distribution strategies. 2) Membership fee: The membership fee is equivalent to popular multiplayer game subscriptions. 10M WOW gamers pay $13-$15/mo; Guitar Master - $29/mo Members get access to project plans, Webcast lessons and feedback, online exhibits and project portfolios, Ecommerce discounts, and master builder certifications. For a membership fee of $240/yr, typically a member would spend 166 hours in groups of 8 members at a cost of $1.44/hr

3) Customer acquisition cost is a key assumption: Customer acquisition cost is zero for printed pieces for 1/2 of customer base. The customer acquisition cost for 1/2 of customer base is $35/member $29 - Amazon.com $60 - Credit Cards $34 - Various E-Commerce Sites $31 - Typical Retail Customer 4) Member / Webcaster ratio is a key assumption: Live Webcasting is a differentiator. It's fundamental to success. BIY is selling an opportunity for kids to build relationships with Webcast 'tutors' from university communities such as MIT and Harvard. This plan assumes 80 members/tutor in Yr1 to 100 members/tutor in Yr 3. In practice, members will be online simultaneously with a Webcast 'tutor' and other members in groups of Assume each member is online an average of 4 hours per month or one 1-hr workshop/wk. Then a webcaster would have to serve 400 member-webcast hours per month. (100 members x 4 hours / month). If we assume the average webcast room size will be 10 members, then the webcaster would have to serve 40 hours per month or 10 hours per week. Students at MIT are not allowed to work more than 20 hours per week in a UROP program. We are proposing a firm commitment for 10 hours per week. This is less than it would take to participate on an athletic team.

5) Potential: (Can this be a $50M business?) There are 20+ million kids between the ages of in the US. 1.5% market penetration would yield the following results: $78,625,000 Revenue $57,116,969 Expense $21,508,031 Earnings (before tax) 27% Earnings / Revenue Ratio (before tax) Bright Horizons has a 5.4% Earnings / Revenue ration (after tax) McGraw Hill Publishing has a 14.4% Earnings / Revenue ration (after tax) 6) Productivity: 4 college student Webcast 10hrs/wk = 1 employee 4 college student Webcast $10/hr - $12/hr are paid $20K/yr - $24K/yr Full time base salaries are $60K - $110K/yr In Year 3, this plan generates revenue of $101,378 per employee Starbucks productivity is $55K/employee Microsoft productivity is $500K/employee

7) Gross Profit Margins Gross Margin = Gross Profit/Sales 52% Build-It-Yourself ($25/hr rev - $12/hr webcast fee)/$25/hr Bright Horizons (BFAM) an after school service program, has a $1.03B market valuation 22% gross margin (44% is industry average) 13% EBITA (19% industry average) $40K revenue / employee From Fidelity (Dec 06) Microsoft (MSFT) has a $294B market valuation 84% gross margin (74% is industry average for software) 41% EBITA (27% is industry average) $698K revenue / employee McGraw Hill Companies (MHP) has a $24B market valuation 61% gross margin (31% is iindustry average for publishers) 24% EBITA (12% is industry average) $314K revenue / employee 8) Cost / Hr of Instruction BIY can deliver consistent, high-qualtiy instruction at <1/2 price of typical instruction. If member pays $10/mo and does a 1hr workshop each weekend, that member is paying $2.50/hr for live collaboration. In addition the member gets access to on demand content and web space to post projects. $10/hr - babysitter $10-$20/hr - camp or after school enrichment program $10/hr - cost of public school (per GLTS inner city school 2006 budget) $50/hr - private tutor

Team Members – Background
The Build-It-Yourself team is experienced and dedicated to bringing our highly valued programs online. Team Members – Background Responsibilities Build-It-Yourself will recruit a business development team John Galinato – Content Management MEE, Cornell University. More than 25 years of software project management experience. Liu Huan – Platform Management MIT class of 2010, Computer Science and Electrical Engineering Build-It-Yourself will recruit a workshop delivery team of students from prominent Universities. Manage business development Specify and manage courseware. Specify and manage platform development Manage network of workshop leaders and specialists OUR TEAM IS ENTREPRENEURIAL AND EXPERIENCED. It draws heavily from the Harvard and MIT communities. We have a core group of contractors many of whom would like to join the team full time when we are funded. We’re looking for an energetic MBA to lead the business.

Contractors – Background
Build-It-Yourself has a long history of attracting talented, highly skilled contractors. Contractors – Background Responsibilities Pete Buletza – Engineer BS in Computer Science, Harvard University. 10 years experience with the CIA, Intuit, and start-up companies developing Internet based technology. Seth Mastin – Engineer BS in Computer Science, MIT 2005. Rebekah Gendron – Teacher Masters Degree in Technology Education, University of Rhode Island. Technology Coordinator in Rhode Island School of the Future. Ann Butler – Content Advisor MEd, Harvard Graduate School of Education. 10 years experience in training and teaching. Presently writes for the Boston Globe. Platform Architecture and Development. Content development and webcasting Lesson plan development OUR TEAM IS ENTREPRENEURIAL AND EXPERIENCED. It draws heavily from the Harvard and MIT communities. We have a core group of contractors many of whom would like to join the team full time when we are funded. We’re looking for an energetic MBA to lead the business.

Comps After we complete our Proof of Execution Phase, we anticipate needing a significant investment to grow to 300,000 members. Empowering the next generation of builders

Build-It-Yourself seeks partners who can help bring our unique online learning environment direct to kids and their parents at home. Our long term business goals are to: set a new standard for online education. generate a very high return on investment. We seek partners to help us reach these goals. John Galinato Empowering the next generation of builders

Empowering the next generation of builders

Similar presentations

Presentation on theme: "Empowering the next generation of builders"— Presentation transcript:

Similar presentations

About project

Feedback

Log in

Auth with social network:

Empowering the next generation of builders

Similar presentations

Presentation on theme: "Empowering the next generation of builders"— Presentation transcript:

Similar presentations

About project

Feedback