Mobile Payment

Application

Business Plan

Founders:
John Doe

Sample Investor Plan

EXECUTIVE SUMMARY
The ecommerce industry has two problems; the cumbersome checkout process and the increase of cyber crime. More people
are using mobile devices for online purchases and the current experience is not aligned with expectations for a fast and user-
friendly checkout. The poor desktop experience of tedious form-filling is worse on a mobile device with checkout
abandonment topping 90%. Additionally, 3 out of 5 shoppers have five or more online passwords and adding credentials is
difficult to manage.

The Company’s mobile payment app solves both problems by offering retailers and consumers a simpler, faster and more
private way to shop online. With Payment Company, the typical transaction is completed in under 12 seconds, achieved
through numeric PIN-based authentication and a streamlined user interface for selecting payment methods and shipping
addresses. The long checkout process becomes the simple ‘swipe card, enter pin, hit OK’ experience everyone knows from
in-store checkout. The Company has also devised an ingenious process where all financially sensitive information is encrypted
and stored on the phone. The Company reduces risk by encrypting the user’s sensitive information and storing it locally in
the app on their mobile device, not on servers or the cloud where it is at risk. The encrypted information, passed securely to
the payment gateway, is never shared with retailers, 3rd parties or even the Company.

The Company’s fully-functioning mobile app is available for iOS and Android. Eleven small retailers have already agreed to
integrate Payment Company and discussions with several enterprise retailers are in process.

Ecommerce sales will reach $500 billion by 2018. In 2014, an estimated 110,000 eCommerce websites worldwide generated
over $1M and Forrester estimates that alternative payments platforms will be adopted by 45% of shoppers by 2017
representing $6.43B. The Online Payment Software Developers industry has grown tremendously the last five years.
Revenues earned by developers has been growing at average of 17.6% annually, totaling $14.3BN in 2014. The accelerated
pace of revenue growth has led to high profit margins for the industry’s major players and lured a large amount of new
entrants. During the past five years, the number of enterprises in the industry has grown to 1,459.

The Company will monetize its software by licensing Payment Company to online retailers. With a small, medium and large
retailer-based solution, the Company will charge its accounts a flat fee based upon a price band that fits within these
spectrums. Specifically, these are $150, $5,000 and $15,000 per month, respectively. The product is completely free for
consumers and retailers can incorporate their own payment processor thus avoiding additional processing fees. Retailers
also benefit from partnering with Payment Company by incurring a lower shopping cart abandonment rate, thus enabling
retailers of all sizes to earn a direct return on their investment.

The Company anticipates that their primary customers will be online retailers that generate at least 40,000 orders a month
or approximately $25M a year. According to Internet Retailer Top 500 and Second Top 500, there are at least 1,000 e-tailers
in the US that meet this profile. The Company will employ its own direct sales force to reach these potential accounts. The
Company also holds strategic partnership with BlueFin Payment Systems and Comodo, who has agreed to promote Payment
Company to smaller retailers. The minimum monthly order size for these small accounts is at least 1,225 orders a month or
$730K a year. It is unknown how many accounts meet this profile. Payment Company will utilize mass marketing branding
efforts to develop top-of-mind awareness for its services.

Payment Company faces competition from other payment technologies. The most notable services are: Visa Checkout,
Google Wallet, and Apple Pay. Despite a competitive field, such services are still in the early stages of adoption and the
Company has a significant advantage over other technologies in the market due to its unparalleled ease of use and ability to
pay without usernames or passwords. This technology is protected by a pending patent and allows Payment Company to
break into the market with a service that sets itself apart from existing technologies.

Mike Marenick and Robert McHugh are the founders of Payment Company, and are leading a team of seasoned industry
professionals who are well connected and attuned to the needs of the market. The work ethic and business acumen of this
team will be the key drivers that propel this venture towards a position of lasting success.

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OBJECTIVE
The purpose of this plan is to provide investors with the information necessary to evaluate the scope and future growth of
Payment Company in the market place. In addition to serving as a road map for management, the plan will show that: 1) a
significant market opportunity exists when analyzing the current market demands and competitive landscape; 2) the
management team in place is qualified to execute on a well-thought-out operational, marketing and sales strategy; and 3)
the correct capital structure will allow for a long lasting, profitable business.

To achieve the Company’s objectives,

Payment Company is seeking $2,250,000 in
seed plus funding. The funding will be
allocated in a variety of ways including
staffing, product development, operations,
and marketing initiatives. The investment
risk is minimal based on the management
experience and industry growth rates.
Payment Company’s financial model shows
consistent growth for the brand over the
next 3 years. By year 3, plans call for the
Company to achieve $22.8MM in annual
gross revenue with a net profit of $2.8M or
12.34%.

STARTUP SUMMARY

The total start-up funding needed to successfully implement this venture is $2.25M. To date, the founders have raised $500K
in developing a functional product and the Payment Company brand. Once the additional capital is raised, $800K will be used
for start-up expenses. The remaining balance of $1.45M will be used for working capital.
St art up Funding St art up Requirement s
Startup Expenses to Fund $800,000 Startup Expenses
Startup Assets to Fund $1,450,000
Legal $100,000
Total Funding Required $ 2 ,2 5 0 ,0 0 0
Prelaunch Marketing $120,000
Assets Application Development $368,000
Non-cash Assets from Startup $0
Website Development $30,000
Cash Requirements from Startup $1,450,000
Additional Cash Raised $0 Consulting $60,000
Cash Balance on Starting Date $1,450,000 Rent Deposit $2,500
Total Assets $ 1 ,4 5 0 ,0 0 0 Computer and Office Equipment $60,000
Liabilit ies and Capit al Other $59,500
Liabilities Total Startup Expenses $ 8 0 0 ,0 0 0
Current Borrowing $0
Startup Assets
Long-term Liabilities $0
Accounts Payable (Outstanding Bills) $0 Cash Required $1,450,000
Other Current Liabilities (interest-free) $0 Startup Inventory $0
Total Liabilities $0 Other Current Assets $0
Capit al Long-term Assets $0
P lanned Investment Total Assets $ 1 ,4 5 0 ,0 0 0
Owner $0
Total Requirements $ 2 ,2 5 0 ,0 0 0
Investor $2,250,000
Additional Investment Requirement $0
Total P lanned Investment $ 2 ,2 5 0 ,0 0 0
Loss at Startup (Startup Expenses) ($ 8 0 0 ,0 0 0 )
Total Capital $ 1 ,4 5 0 ,0 0 0
Total Capital and Liabilities $ 1 ,4 5 0 ,0 0 0

Total Funding $ 2 ,2 5 0 ,0 0 0 2|Page

THE PAYMENT COMPANY APPLICATION
Payment Company is a disruptive mobile payment platform that
enables users to shop online without the need for a username and
password. Users simply download the application, scan their credit
card and driver’s license and select a PIN. In less than 60 seconds this
information is entered, users can shop at any store that accepts
Payment Company.

The checkout process is extremely minimal, fast and easy. Users simply
verify their PIN and Payment Company facilitates a seamless
transaction. Consumers benefit as they never have to use their device’s
QWERTY keyboard throughout the entire process, nor are they asked
to create a new username/password or share financially sensitive data
with another company.

With Payment Company, consumers store their financial data locally;

such data is never shared with the retailer, Payment Company or any
other third-parties. Retailers also benefit immensely as the solution
reduces shopping cart abandonment and thus improves their bottom
line. Retailers do not need to add or change any internal process to
utilize Payment Company. Payment Company passes encrypted
financial data directly to the retailer’s existing payment gateway or
merchant processor.

On the following page is a detailed feature list for both consumers and
retailers.

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USER PRIVACY

Complete privacy and control

All of the Payment Company user's personal and financial information is stored
locally on their device, protected by the latest encryption technology. As part of
the Company’s commitment to privacy, all information is completely invisible to
Payment Company, third-parties and even the user. Furthermore, the risk
associated with having multiple accounts with different companies is eliminated.
This brings control back to the user and provides him or her with peace of mind.

Two and three-pass parameters

Users must have a Payment Company PIN, Phone and Phone PIN to confirm
checkout. This multi-layer security parameter reduces the risk of fraud.

PIN-based Authentication and Transaction Authorization

Payment Company leverages a PIN to authenticate users and approve
transactions, eliminating the need for usernames and passwords, which can be
forgotten so easily. Instead, users are presented with a fast, familiar and secure
experience similar to checking out in a retail store – swipe card, enter PIN and
press OK.

Application Locking
Users have the ability to lock the app at their discretion. This feature adds an
additional level of security to the app as it prevents unauthorized users from
accessing personal information by automatically locking once the app is closed or
minimized. Non-sensitive menu options remain available when the app is in a
locked state.

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USER EXPERIENCE

Scan-based Onboarding
Scan-based onboarding allows for expedient account setup. All required personal and
financial information can be entered in less than 60 seconds, without use of the keypad.

QWERTY Keypad Input Eliminated

Fast PIN-based checkout reduces the chance of typing errors and the time needed to
check out. These features are particularly valuable for mobile device users.

Access and Availability

Payment Company is integrated into the merchant's cart page, providing users with
convenient access no matter where the user is or what device they are using.

Device Compatibility
Payment Company is available for both iOS and Android devices. User base is not
segmented or prioritized by device type or operating system and is backwards
and forward compatible. This allows Payment Company the greatest exposure to
users.

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ACCOUNT MANAGMENT

Simple Payment and Shipping Selection

Payment methods and shipping addresses can easily be selected from a
single screen by intuitively swiping through a proprietary card carousel.

Quick Payment Method and Address Editing

Users can easily manage their account to add, edit or delete credit cards
and shipping addresses through a main dashboard home screen.

Recent Transactions
Users can quickly and easily view recent transactions information,
including date, credit card used, retailer name, checkout amount and
authorization statuses.

Default Payment Settings & Personal/Business Toggle

Users can designate a credit card to be the default payment method when
making a purchase. Quick toggle makes it simple for users to separate
business and personal expenses.

Simple Address Import

Users have the option to import shipping address information directly
from their native contacts list on their mobile device to the Payment
Company platform with just one touch.

Bluetooth Data Transfer

Users can transfer their account to a new device via near field Bluetooth
technology (future release).

75% of merchants view payment security and/or customer data

security as primary concerns

Additional Consumer
Liability Shift
Costs Trust at Stake
• Hardware, fees, • Brand name • Losses from Card
changes in coding importance Not Present
• Must meet security • Brand loyalty at risk transactions are
standards merchant liability

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RETAILER/MERCHANT FEATURES

Reduces PCI Compliance Responsibility

By creating a fully secure end-to-end payment channel, Payment Company
eliminates the need for retailers to store their customers' personal and
financial information. This reduces the costs associated with PCI compliance
and audits.

Simple Integration into Existing Ecommerce Website

Integration with the Payment Company API can be completed in hours,
allowing retailers to quickly benefit from Payment Company's checkout
experience without significant cost or time requirements.

Improved Checkout Experience

The required steps for checkout are significantly reduced. Total checkout time
is decreased to just 12 seconds.

QWERTY Keypad Input Eliminated

Intuitive swipe navigation reduces the steps, time and ultimately the
frustration of checking out on a mobile device.

Works With Existing Merchant Account

Unlike PayPal, which requires a separate merchant account, Payment Company
integrates with the retailer's existing account. This reduces overhead, payment
holds and managerial oversight.

Orders Are Completed on the Merchant's Website

Customers never leave a retailer's site to checkout, allowing them to quickly be
reengaged with targeted marketing.

THE PAYMENT COMPANY EXPERIENCE

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INDUSTRY ANALYSIS SUMMARY: ONLINE PAYMENT
PROCESSING SOFTWARE1

The Online Payment Processing Software Developers industry has experienced rapid growth during the five years to 2014,
with revenue expanding an average 17.6% annually over the period. The accelerated pace of revenue growth has led to high
profit margins for the industry’s major players and lured a large amount of new entrants to the industry. During the past five
years, the number of enterprises in the industry has grown at an average annual rate of 20.8% to 1,459 operators, and is
expected to grow, albeit more slowly, at an annualized 4.4% during the next five years. Some acquisition activity has taken
place, such as eBay’s acquisition of the mobile payment platform developers Zong and Braintree and its sister’s company,
PayPal’s recent acquisition of Paydiant. In addition, LoopPay was also recently acquired by Samsung in their efforts to develop
a digital wallet platform. Acquisition activity will increase during the next five years, slightly tempering the flood of industry
entrants.

During the next five years, mobile payment processing systems are expected to become a prominent part of the industry.
These systems will enable small businesses and merchants to receive payments via their mobile phones. The new technology
has already gained a foothold in some industries, particularly taxi companies, but will become more widespread over the
next five years as developers improve their interfaces, consumers grow comfortable with the new technology and industry
players prove they are more efficient and convenient than their many alternatives. Over the long term, the industry will look
to develop a payment-as-a-platform model, a system that would create an all-encompassing layer to connect disparate
methods of payment. These two new product types will encourage continued rapid revenue growth, with the industry
expected to grow at an annualized rate of 4.4% during the five years to 2019 to reach $17.8 billion.

MARKET TRENDS: MERCHANTS WILL PROCESS PAYMENTS DIRECTLY2

PayPal and other services gained their industry footholds during the past 10 years because they offered the safety of an
intermediary in online purchases. Consumers felt comfortable setting up one account with the payment processing platform,
sharing credit card or bank account information, and then using that account to interact financially on the internet. This trend
has started to reverse, primarily due to the reduction in fees charged to process credit card payments. As a result, it is cheaper
for merchants to allow only the direct use of credit cards and refuse to accept payment from payment processing platforms.
In addition, credit card companies have strongly increased their online fraud prevention capabilities since the inception of
the internet. Consequently, merchants are not looking to add payment processors but more so value added solutions to their
existing processors.

1
“Online payment processing software developers.” IBISWorld. 2014. Obtained at www.ibisworld.com.
2
IBID
8|Page
PRODUCTS AND SERVICES
SEGMENTATION3

The industry essentially provides one service – facilitating

online payments. At the heart of this service are the
processing networks that form the principal routes for the
electronic movement of money and financial data. Some firms
may have direct access to this network while others must
access it through intermediaries. Thus, it is useful to segment
the industry’s one service into several different services that
are differentiated from one another by the proximity the
payment processing firm has to this underlying financial
network.

RETAILERS WORK DIRECTLY WITH MERCHANT ACCOUNTS

Payment Company business model does not add any intermediary into the payment processing ecosystem. The company
solutions enables retailers to use their own payment processor and thus plays in the merchant accounts segment of the
market. The data suggest that merchants prefer to manage their own fraud prevention, chargebacks and settlements rather
than pay a premium for a third-party processor.

MAJOR MARKETS4

The industry’s primary market is merchants that conduct business over the internet. These businesses can be segmented
into small firms and medium-to-large firms. Additionally, a small portion of industry revenue comes from consumers that
transfer money using payment processing software. Over the next five years, no market segment is expected to significantly
change its percentage of industry revenue.

3
IBID
4
IBID
9|Page
TARGET: SMALL, MEDIUM AND LARGE RETAILERS5

Payment Company will largely target medium to large ecommerce accounts. The Company will also sell its services to smaller
businesses, however not focus its internal resources to target such accounts. Instead, the Company will leverage a strategic
partnership with Comodo to sell to these smaller accounts. Below is a segment summary of the small and medium-to large
enterprise accounts.

Small business

Small businesses are estimated to account for about 46.3% of industry revenue. Due to the small sales volume of most small
businesses, pricing agreements with firms that take a percentage of each transaction are the most cost-effective way for
these businesses to implement payment processing platforms on their sites. Payment Company has taken into account such
needs and will offer a low flat monthly fee that is in range of a small sized retailer’s budget.

Medium-to-large enterprises

Medium-to-large enterprises account for about 48.4% of industry revenue. While there are many more small businesses than
there are large ones, large businesses have a high volume of sales transactions, which generates significant revenue for the
industry. While many payment processing firms offer discounted percentage rates for high sales volumes, large businesses
may find pricing agreements that involve an initial setup fee and recurring monthly fees more attractive.

POTENTIAL ENTERPRISE ACCOUNTS

The management team has personal ties to a number of key executives in the enterprise segment. Enterprise is defined as
internet sales in excess of $1B annually. These potential accounts have expressed interest in the Payment Company services
and are willing to entertain a proposal to integrate Payment Company into their internet storefront and make introductions
to other Fortune 500 companies. While the business plan does not account for enterprise level sales, there is a significant
likelihood that the management team will close a number of these accounts after its launch date. References will be furnished
upon request.

5
IBID
10 | P a g e
PRICING
While Payment Company is free for users, the Company’s pricing model calls for a flat monthly licensing fee based upon the
retailer’s order volume. The management team has thus segmented potentials accounts into small, medium and large sized
and has priced Payment Company to meet everyone ROI requirements. See below:

Small Sized Companies Value Medium Sized Companies Value Large Sized Companies Value
Annual Sales $734,694 Annual Sales $24,489,796 Annual Sales $73,469,388
AOV $50 AOV $50 AOV $50
Expected Margin $5 Expected Margin $5 Expected Margin $5
Orders / Month 3000 Orders / Month 10,000 Orders / Month 100,000
Estimated Abandoned Orders 5000 Estimated Abandoned Orders 16,667 Estimated Abandoned Orders 166,667
Base Line Conversion 2% Base Line Conversion 2% Base Line Conversion 2%
New Conversion 2.45% New Conversion 2.45% New Conversion 2.45%
Estimated Order with Paydunk 3675 Estimated Order with Paydunk 12,250 Estimated Order with Paydunk 122,500
Orders recaptured 675 Orders recaptured 2,250 Orders recaptured 22,500
Sales by Paydunk $33,750 Sales by Paydunk $112,500 Sales by Paydunk $1,125,000
Gross Profit made by retailer $3,375 Gross Profit made by retailer $11,250 Gross Profit made by retailer $112,500
Licensing Fee $150 Licensing Fee $5,000 Licensing Fee $15,000
Net Profit $3,225 Net Profit $6,250 Net Profit $97,500
ROI 2150% ROI 125% ROI 650%
New Orders / Month to breakeven 30 New Orders / Month to breakeven 1000 New Orders / Month to breakeven 3000
Monthly baseline 1224 Orders / Month baseline 40,816 Orders / Month baseline 122,449
Assumes 1) average shopping cart abandonment rate of 60%. 2) AOV of $50 3) Expected Margin of 10%

Market size
$6.43B in alternative
online payments
Payment Company operates within the
merchant account sector of the industry. The $14.3B in payments
Company focuses primarily on medium and fees from online
merchants
large sized businesses. This intersection
accounts for 15.5% of total industry sales.
$294B in e-commerce
Furthermore, it is estimated that the maximum transactions in the US
adoption for alternative payment systems to (2014)
reach 45% in the future6. Given the industry 110,000 e-commerce
research, the management team estimates the websites generating
total addressable market to be $6.43 BN.7 +$1M online revenue

MARKET NEEDS

The market is in need of a payment platform such a Payment Company. With the status quo, consumers risk their security
and suffer an inconvenience from registrations when shopping online. In the face of increased cyber-attacks, shoppers are
not safe, exposing their credit card and personal information with highly vulnerable retailers. A news study reports that,
“eCommerce sites were found to be the number one targeted asset accounting for 48 percent of all data breaches
investigated, a 15 percent increase from the previous year.”8 At the same time, consumers do not want to change their
behavior or deal and an extra layer of security protocols to protect themselves. Currently, 3 out of 5 shoppers report having
5 or more unique online passwords.9 Adding any additional credentials is difficult to manage. Retailers are also leaving money
on the table as this phenomenon causes many consumers to shop at a brick and mortar or not shop at all. Business news
daily reports that “Security issues top the reasons why consumers are hesitant to shop on their smartphones or tablets”.10

6 “Us Mobile Payments Forecast, 2013 To 2017” Forrester Research, Inc. 2013
7 “US Ecommerce growth” Forbes, 2014 Obtained at http://www.forbes.com/sites/forrester/2014/05/12/us-ecommerce-grows-
reaching-414b-by-2018-but-physical-stores-will-live-on/
8 https://www.thawte.com/about/news/?story=387720
9 https://www.secureworldexpo.com/identity-crisis-within-social-networks
10 http://www.businessnewsdaily.com/7756-online-shopping-preferences.html

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As such, the need for services that can transact and store information locally without the need for new credentials is greater
than ever. This is precisely the area that Payment Company will address.
COMPETITIVE ANALYSIS

Payment Company was selected for a graduate research project by Kellogg School of Management’s Analytical Consulting
Lab. In this project, MBA candidates dedicate a semester working on Payment Company’s customer acquisition strategy,
competitive analysis and financial modeling.

Payment Company is keenly aware that it must consistently analyze the competitive landscape to accelerate its position in
the marketplace. Any business that operates with a similar model serves as a direct or indirect competitor. The identified
competitors are described below.

Paypal – Acquired by eBay

eBay operates in this industry through its payments segment that includes the core payment
brand PayPal, which enables individuals and businesses to send and receive payments online
and through mobile devices. eBay has a related consumer credit business, Bill Me Later, which
enables US merchants to offer credit to US consumers at the point of sale for eCommerce and
mobile transactions. The majority of revenue for the payments segments comes from a take
rate on the net TPV, the total dollar volume of payments, net of payment reversals, completed
through the PayPal payments networks, including Bill Me Later.

Visa Inc. - Estimated market share: 4.9%

Visa is an American multinational financial services company that facilitates electronic payment
systems throughout the world. The company operates the world’s largest retail electronic
payments network through the transfer of value and information among financial institut ions,
merchants, consumers, businesses, and government entities. It has made 4 related acquisitions
in this space.

Google Inc. - Estimated market share: N/A

Google Wallet was the mobile wallet pioneer in the US in using NFC technology. However
due to lack of partnerships and the telecom providers unwillingness to install the wallet as
part of the new phones being sold, it did not see early mainstream adoption. Estimates
indicate approximately 50,000 to 100,000 downloads with few consumers actually using it.

After the launch of Apple Pay, Google did a major reboot to their wallet initiative and was
able to broker a partnership with Softcard (who is now defunct) to acquire some of its IP, and
is planning to re-launch the wallet and the Payments API platform.

Apple Pay: - Estimated market share: 1.7% Market share

Apple Pay is Apple's mobile payment solution for the iPhone 6 and Apple Watch. Payments
made through Apple Pay accounted for between 0.1%-1.6% of transactions at five top
retailers in the month following the launch of the feature. According to a report released
today by ITG Market Research, Apple Pay has gained a 1.7% market share as of six weeks
after its release

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COMPETITIVE ADVANTAGES

What follows is a listing of the primary competitive advantages of the Company upon entering the market.

 Consumers do not require any new credentials to use. Just a one-time set up, their phone number and PIN
 Setup is completed in less than 60 seconds.
 No new payment processor required. Merchants can use an existing one
 Minimal streamlined integration into eCommerce platforms
 Data is stored encrypted locally on the user’s device within the app. Payment Company is immune from cyber
breaches
 Outstanding support and service for the product
 Knowledge and leadership of founders

BARRIERS TO ENTRY11

The increasing competition and expected consolidation makes it challenging for new entrants in the industry to enter. New
entrants must have a fundamental knowledge of website development, online financial transactions and securing sensitive
information on the internet. This necessitates a workforce of highly skilled employees and an investment in an infrastructure
to provide online payment services. Payment Company’s unique model allows it to overcome these challenges by shifting
the storage of sensitive information to local devices.

Furthermore, regardless of how secure a new entrant’s payment platform is, lesser-known companies may struggle to gain
the trust of merchants and consumers. This barrier to entry reinforces itself: Firms cannot gain the trust of businesses and
consumers without establishing a well-known brand name, and firms cannot establish a well-known brand name without
attracting a large user base of consumers and merchant partners. Despite these challenges, the management team is
confident it can overcome such obstacles as Payment Company differentiates itself with an unparalleled shopping
experience. With its innovative mobile, secure and easy payment system, it will quickly earn the trust of merchants and
consumers alike and be able to defend its positions from new entrants as it scales. The Company also holds a patent pending
to protect itself from copycats.

SWOT ANALYSIS

The following is a listing of the key strengths and weaknesses of Payment Company, as well as the opportunities and threats
that exist within the marketplace.

Strengths Weaknesses
 Knowledge and network of founders
 Patent pending technology
 Company needs funding and working capital for
 Fastest, simplest payment method in the
a successful launch
market
 As a new business, the Company must build its
 Customer service commitment
credibility
 Commitment to privacy
 Scope of services to various sized retailers

Opportunities Threats
 Applications in the brick and mortar market
 Consumer behavior shifting to mobile
payments  Larger players can replicate Payment Company
 Increased burden on compliance will shift data  Larger retailers may promote their own
warehousing solutions to local devices payment method
 Growth in international eCommerce market

11
“Online payment processing software developers.” IBISWorld. 2014. Obtained at www.ibisworld.com.
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BRANDING AND MARKETING

Payment Company recognizes that maintaining a sterling, well-regarded brand is essential to propagating a strong standing
amongst both retailers and consumers. The objective is to raise brand awareness on both fronts that will emphasize a user
friendly user platform. The Company’s branding will aid in fueling word-of-mouth exchange and building a loyal customer
following. The Company will also fervently track any direct or indirect competition in the marketplace to ensure it stays on
top of cutting-edge industry trends and opportunities. Moving forward, Payment Company will strive to meet the following
objectives as it accomplishes specific keys to success:

OBJECTIVES

 Become a recognized leader in the online payment industry

 Develop a strong customer service model that fits the needs of different sized retailer
 Remain flexible in product offerings and offer custom suites that meet the needs of sellers
 Remain attuned to the marketplace and integrate products into the business mix that meet the needs of the
targeted audience

MARKETING CAMPAIGN
Marketing for Payment Company will be done through a variety of channels including the direct sales to medium
and large sized retailers, internet marketing, social media, press releases, and word of mouth. Internet efforts
will be driven through a user friendly website and mobile application. In addition to the web and mobile presence,
plans also call for developing an extremely strong social media campaign. Word of mouth will round out the
marketing model and has the potential of providing the most marketing push as it will allow the organization to
deliver an authentic, trusted marketing message.

DIRECT SALES:
Payment Company will employ a dedicated sales team for
sales and promotional efforts to medium and large sized
retailers. Key decision makers will be VP of eCommerce,
director level marketing roles and senior IT influencers.
All sales efforts will involve informational discussions and
presentations.
PARTNERSHIPS:
Payment Company will engage in strategic partnerships to
promote its service to smaller retailers. One such
partnership is Comodo, whose salesforce sells and renews
SSL certificates to tens of thousands of retailers annually.
A commission structure will be offered to promote
Payment Company.
SOCIAL MEDIA:
Payment Company will allocate a large portion of its
marketing budget to generate brand awareness and
manage its brand on social media sites, such as Facebook
and Twitter. Social media has the potential to reach
millions of potential consumers.
PRESS RELEASES:
Press releases will alert relevant media channels of the
Company’s offerings, business updates, and other
newsworthy items. Media coverage will increase the
Company’s credibility and recognition among the public
and key industry decision makers.
WEBSITE AND MOBILE:
A well-optimized web and mobile site with proper site
structure, page layout, and clear and easy navigation,
along with targeted keywords embedded throughout the
site has been constructed and will ensure proper search
engine placement and saturation.
GOOGLE ADWORDS:
AdWords offers pay-per-click (PPC) advertising, cost-per-
thousand (CPM) advertising, and site-targeted advertising
for text, banner, and rich-media ads.

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EXIT STRATEGY

After careful consideration, the Company has developed the following scenarios for the investors and
management to recover their investments.

SCENARIO ONE: REPAYMENT

Payment Company chooses to remain a privately owned enterprise. The Company repays its investors in full,
consolidating ownership in the Founders.

SCENARIO TWO: BUYOUT

Payment Company, as a successful income-generating operation, experiences growth and sees the opportunity
to expand its brand into additional markets. This opens the door for additional product offerings and revenue
streams. Due to its substantial market growth and industry recognition, major competing brands begin to take
notice of the Company. These businesses approach Payment Company with attractive buyout offers, and the
Company negotiates and sells to the best deal.

SCENARIO THREE: MERGER

Payment Company merges with another company to expand its market reach and development capabilities.
Potential merger partners include companies that can offer a more diversified market reach or provide expanded
resources for product or service research and development. Payment Company’s management would maintain
majority control of the Company and combine its operational and sales efforts with its merger partner.

SCENARIO FOUR: IPO

The Company sells its interest in itself through the sale of stocks on the open market. Going public is an arduous
and challenging journey for a Company but, if achieved, is highly rewarding. As a public company, or IPO, Payment
Company will enjoy increased exposure and prestige, helping it to attract and retain the most talented executives
and employees. Payment Company’s ownership and management may also liquidate its equity in the Company
through the sale of its ownership shares. If the ownership sells, the new stockholders will own the brand and will
be responsible for its operation and future activities.

CONCLUSION

Payment Company may entertain merger or acquisition scenarios by a major company upon the realization of anticipated
operating results and favorable market conditions. Aside from merger or acquisition, the Company may instead strive to sell
its interest in through the sale of stocks on the open market, likely reaping outstanding reward for investors if IPO-status is
achieved and potentially handing control of the brand over to the new majority stockholders. The Company may also choose
to liquidate its assets, repay its investors and debtors, and close the business. A final option would be repaying investors and
remaining a privately owned enterprise. The Company will entertain all scenarios that could be lucrative for the Company
and investors. The final decision will depend on market forces and the wishes of the Company’s owners and investors.

15 | P a g e
INVESTMENT ANALYSIS

The Company is seeking a cash infusion of $2.25M in seed plus funding in exchange for a 15% equity stake in
Payment Company. Upon hitting’s its milestones, the company anticipates a round 1 of financings at the end of
year 3 and an exit in 6 years. Below are the projected investment scenarios.

Investment O ffering Seed Round 1 Round 2 Exit

P roposed Year: 1 2 3 7
Valuation, Investment, Shares
Investment Amount $500,000 $2,250,000 $0
Equity Share Offering Percentage 16.67% 15.00% 0.00%
Valuation $3,000,000 $15,000,000 $0 $89,600,000
Investor Exit Payout $12,693,333 $13,440,000 $0
Investor Years Until Exit 6 5 4
Investor IRR 71.44% 42.97% 0.00%

Share O wnership Year 1 Year 2 Year 3 Year 7

Founders' Shares 10,000,000 10,000,000 10,000,000 10,000,000
Stock Split Multiple 0 0 0
Stock Options Issued 0 0 0 0
Investor Shares Issued 2,000,000 2,117,647 0
Price per share $0.25 $1.06 $0.00 $6.35
Options Holders' Shares 0 0 0 0
Year 1 Investors' Shares 2,000,000 2,000,000 2,000,000 2,000,000
Year 2 Investors' Shares 2,117,647 2,117,647 2,117,647
Year 3 Investors' Shares 0 0
Total Shares Outstanding 12,000,000 14,117,647 14,117,647 14,117,647

Equity O wnership P erc entage Year 1 Year 2 Year 3 Year 7

Founders' Equity 83.33% 70.83% 70.83% 70.83%
Option Holders' Equity 0.00% 0.00% 0.00% 0.00%
Year 1 Investors' Equity 16.67% 14.17% 14.17% 14.17%
Year 2 Investors' Equity 15.00% 15.00% 15.00%
Year 3 Investors' Equity 0.00% 0.00%
Total Equity 100.00% 100.00% 100.00% 100.00%
Investors' Equity 16.67% 29.17% 29.17% 29.17%
Founders' & Employees' Equity 83.33% 70.83% 70.83% 70.83%

16 | P a g e
MANAGEMENT

JOHN DOE - COFOUNDER

Mr. Doe has over 30 years’ experience in management and technology consulting. He achieved a 31-year career with
Accenture (formerly Andersen Consulting), where he served in a number of management positions, including global
management responsibility for human performance service offerings, global change management for communications and
high tech industries, Americas change management, Ohio consulting practice head and worldwide head for the distribution
industry practice. He has extensive experience in strategic initiatives and operational responsibilities grounded in information
technology and performance management.

Mr. Doe continues in an active role with both private and public companies. He has been an investor, advisor and board
member for early-stage and public companies providing a wide range of technology solution offerings including eLearning,
compliance and corporate governance, employee sourcing and recruiting, and home networking. Mr. Doe serves on the
board of Agilysys, Inc. ( NASDAQ), a leading distributor of computer hardware and provider of software solutions.

During his business career in Cleveland, Mr. Doe was involved with a number of civic and charitable organizations. He served
on the Achievement Centers for Children board, Playhouse Square board, Boy Scouts of America board, and held various
leadership roles in United Way campaigns.

Mr. Doe holds a B.S. in Industrial Engineering and an M.B.A. from The Ohio State University.

JOHN SMITH – CO-FOUNDER

Mr. Smith has over 11 years of experience as an investor, entrepreneur, operational executive and investment banker within
the technology space. Prior to Payment Company, John worked at Payment Ventures where he pursued investment
opportunities in mobile, internet, gaming, software, and e-commerce. Before joining Payment Ventures, John served as the
Director of Corporate Development & Analytics at PlayPhone. In this role he was responsible for M&A sourcing and execution,
strategic partnerships, and improving operational metrics. John also worked as an investment banking analyst in the TMT
group at Cowen and Company where he completed a number of M&A and equity transactions in the digital media and
communications equipment sectors. Chris began his career at Intel as an operations financial analyst within the Flash
Products Division. In addition, John has consulted for several technology startups including Gilt Groupe and ngmoco.

John earned a B.A. with a double major in Economics and Political Science from the University of California, Davis and an MBA
from IESE Business School in Barcelona. John was selected as a Kauffman Finalist in 2012.

JOHN MILLER – BUSINESS DEVELOPMENT

John brings far more than 17 years of experience in business development, human resources, training and consulting to
his role as a Business Development Manager. He brings a vitality, professionalism and warmth, and a mindset of service
and advocacy to his work with clients.

John’s primary focus is to build awareness to prospective clients, and develop and maintain relationships with current and
past clients. As an advocate of the company's vision to enrich the spirit and performance of organizations, and its purpose
to positively impact the world by creating thriving organizational cultures, John finds his work rewarding and fulfilling.

Prior to joining Payment Company, John spent seven years in the staffing/executive placement industry where he held
roles as a business development manager, national training manager and executive search consultant.

John graduated from Chicago College of Commerce where he studied court and convention reporting.

17 | P a g e
PERSONNEL FORECAST

The personnel forecast below shows the staffing needs for the next five years.

Personnel Plan Year 1 Year 2 Year 3

Co-Founder $75,000 $75,000 $75,000
Co-Founder $75,000 $75,000 $75,000
COO $60,000 $60,000 $60,000
CFO $0 $0 $160,000
Operations and Onboarding managers $0 $90,000 $180,000
Operations $120,000 $120,000 $240,000
Sales / Account Managers $25,000 $50,000 $200,000
Sr. Developer $0 $300,000 $300,000
Junior Developer $0 $150,000 $150,000
Analyst $0 $70,000 $70,000
Customer Service $45,000 $180,000 $180,000
IT Support $75,000 $150,000 $300,000
Total P eople 8 19 31
Total P eople $475,000 $1,320,000 $1,990,000

18 | P a g e
SALES FORECAST

The following is a three-year sales forecast:

Sales Forecast Assumpt ions

Unit Sales Year 1 Year 2 Year 3 Avg Abandon rate 60%
Small Companies 321 5,080 800
Medium Companies 81 1,664 264
Direct Sales Channel
Large Companies 6 192 31 Medium Companies 80%
Total Unit Sales 408 6,936 1,095 Large Companies 20%
Unique Meetings / rep 100
Unit Prices Year 1 Year 2 Year 3 Sales Cycle (months) 8
Small Companies $150 $150 $1,800 Deal closed per month 5
Medium Companies $5,000 $5,000 $60,000 Close rate 5%
Large Companies $15,000 $15,000 $180,000 Months of selling in a year 6
Annual Retention 95%
Sales Year 1 Year 2 Year 3
Small Companies $48,195 $761,940 $1,440,488 Sales reps (direct)
Medium Companies $403,500 $8,322,000 $15,841,682 Year 1 1
Large Companies $90,000 $2,880,000 $5,526,168 Year 2 2
Total Sales $541,695 $11,963,940 $22,808,338 Year 3 8
Year 4 15
Direct Unit Costs Year 1 Year 2 Year 3 Year 5 22
Small Companies $10.00 $10.00 $120.00
Medium Companies $500.00 $500.00 $6,000.00
Comodo
Large Companies $1,500.00 $1,500.00 $18,000.00 Smalled Size Companies 85%
Medium Sized Companies 15%
Direct Cost of Sales Year 1 Year 2 Year 3 Clients reached per month 300
Small Companies $3,213 $50,796 $96,033 Close rate 2%
Medium Companies $40,350 $832,200 $1,584,168 Deals closed per month 6
Large Companies $9,000 $288,000 $552,617 Sales Cycle (Months) 2
Subtotal Direct Cost of Sales $52,563 $1,170,996 $2,232,818 Months of selling in a year 10
Agents
Year 1 3
Year 2 10
Year 3 15
Year 4 20
Year 5 25

19 | P a g e
 BREAK-EVEN ANALYSIS

The following break-even analysis shows the revenue necessary to break-even in the first year of operation. As
shown below, the Company is expected to incur average monthly costs of $57,767 in Year 1. On Average, the
Company’s pays out $129 in commission to per account per month. The contribution margin of each account is
$1,328 per account per month. At this rate, the Company needs to hold at least 48 retailers in its sales portfolio.

Break-even Analysis
Monthly Units Break-even 48
Monthly Revenue Break-even $ 63,974
Assumptions:
Average Per-Unit Revenue $ 1,328
Average Per-Unit Variable Cost $ 129
Average Percent Variable Cost $ -
Estimated Monthly Fixed Cost $ 57,767

Assumes a ratio of 74% small retailers, 22% medium retailers and 2% large retailers

20 | P a g e
 PROJECTED INCOME STATEMENT

Pro Forma Profit and Loss Year 1 Year 2 Year 3

Sales $541,695 $11,963,940 $22,808,338
Direct Cost of Sales $52,563 $1,170,996 $2,232,818
Production Payroll $0 $0 $0
Other Costs of Sales $0 $0 $0
Total Cost of Sales $52,563 $1,170,996 $2,232,818

Gross Margin $489,132 $10,792,944 $20,575,521

Gross Margin % 90.30% 90.21% 90.21%

Operating Expenses
Payroll $0 $1,320,000 $1,990,000
Marketing/Promotion $575,000 $9,675,000 $14,000,000
Depreciation $0 $0 $0
Rent $15,000 $15,000 $60,000
Internet $6,000 $9,000 $10,000
Utilities $5,400 $5,400 $7,000
Hosting Fees $1,800 $3,000 $5,000
Liscenses and Subscriptions $3,000 $6,000 $10,000
Supplies $2,400 $6,600 $10,000
Maintainence $8,400 $8,400 $8,400
Insurance $7,200 $8,400 $10,000
Professional Fees $60,000 $60,000 $120,000
Payroll Taxes $0 $198,000 $298,500
Other $9,000 $12,000 $25,000
Total Operating Expenses $693,200 $11,326,800 $16,553,900

Profit Before Interest and Taxes ($204,068) ($533,856) $4,021,621

EBITDA ($204,068) ($533,856) $4,021,621
Interest Expense $0 $0 $0
Taxes Incurred $0 $0 $1,206,486

Net Profit ($204,068) ($533,856) $2,815,135

Net Profit/ Sales -37.67% -4.46% 12.34%

21 | P a g e
22 | P a g e
PROJECTED CASH FLOW

Pro Forma Cash Flow Year 1 Year 2 Year 3

Cash Received
Cash from Operations
Cash Sales $0 $0 $0
Cash from Receivables $381,879 $10,786,500 $21,596,218
Subtotal Cash from Operations $381,879 $10,786,500 $21,596,218

Expenditures
Expenditures from Operations
Cash Spending $0 $1,320,000 $1,990,000
Bill Payments $548,207 $9,933,773 $17,965,067
Subtotal Spent on Operations $548,207 $11,253,773 $19,955,067

Net Cash Flow ($166,328) ($467,273) $1,641,151

Cash Balance $1,283,672 $816,398 $2,457,549

23 | P a g e
PROJECTED BALANCE SHEET

The balance sheet is a snapshot of Payment Company’s financial condition. The balance sheet has three parts: assets,
liabilities and ownership equity.

Pro Forma Balance Sheet

Assets Year 1 Year 2 Year 3
Current Assets
Cash $1,283,672 $816,398 $2,457,549
Accounts Receivable $159,816 $1,337,256 $2,549,376
Inventory $0 $0 $0
Other Current Assets $0 $0 $0
Total Current Assets $1,443,488 $2,153,654 $5,006,926
Long-term Assets
Long-term Assets $0 $0 $0
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $0 $0 $0
Total Assets $1,443,488 $2,153,654 $5,006,926

Liabilities and Capital Year 1 Year 2 Year 3

Current Liabilities
Accounts Payable $197,556 $1,441,578 $1,479,715
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $197,556 $1,441,578 $1,479,715
Long-term Liabilities $0 $0 $0
Total Liabilities $197,556 $1,441,578 $1,479,715
Paid-in Capital $2,250,000 $2,250,000 $2,250,000
Retained Earnings ($800,000) ($1,004,068) ($1,537,924)
Earnings ($204,068) ($533,856) $2,815,135
Total Capital $1,245,932 $712,076 $3,527,211
Total Liabilities and Capital $1,443,488 $2,153,654 $5,006,926

Net Worth $1,245,932 $712,076 $3,527,211

24 | P a g e
APPENDIX: YEAR ONE FINANCIALS

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 1 0 Month 1 1 Month 1 2
Direc t Channel
Medium Companies 4 4 4
Large Companies 1 1 1
Total 5 5 5
Comodo
Small 15 15 15 15 15 15
Medium 3 3 3 3 3 3
Total 18 18 18 18 18 18
Total Ac c ounts Closed
Small 15 15 15 15 15 15
Medium 3 3 3 7 7 7
Large 0 0 0 1 1 1
Ac c umulated Ac c ounts
Small 15 31 46 61 77 92
Medium 3 5 8 15 22 28
Large 0 0 0 1 2 3

Month 1 3 Month 1 4 Month 1 5 Month 1 6 Month 1 7 Month 1 8 Month 1 9 Month 2 0 Month 2 1 Month 2 2 Month 2 3 Month 2 4
Direc t Channel
Medium Companies 8 8 8 8 8 8 8 8 8 8 8 8
Large Companies 2 2 2 2 2 2 2 2 2 2 2 2
Total 10 10 10 10 10 10 10 10 10 10 10 10
Comodo
Small 51 51 51 51 51 51 51 51 51 51 51 51
Medium 9 9 9 9 9 9 9 9 9 9 9 9
Total 60 60 60 60 60 60 60 60 60 60 60 60
Total Ac c ounts Closed
Small 51 51 51 51 51 51 51 51 51 51 51 51
Medium 17 17 17 17 17 17 17 17 17 17 17 17
Large 2 2 2 2 2 2 2 2 2 2 2 2
Ac c umulated Ac c ounts
Small 143 194 245 296 347 398 449 500 551 602 653 704
Medium 45 62 79 96 113 130 147 164 181 198 215 232
Large 5 7 9 11 13 15 17 19 21 23 25 27

25 | P a g e
Personnel Plan Mont h 1 Mont h 2 Mont h 3 Mont h 4 Mont h 5 Mont h 6 Mont h 7 Mont h 8 Mont h 9 Mont h 10 Mont h 11 Mont h 12
Co-Founder $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250
Co-Founder $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250
COO $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000
CFO $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Operations and Onboarding managers $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Operations $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
Sales / Account Managers $2,083 $2,083 $2,083 $2,083 $2,083 $2,083 $2,083 $2,083 $2,083 $2,083 $2,083 $2,083
Sr. Developer $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Junior Developer $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Analyst $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Customer Service $3,750 $3,750 $3,750 $3,750 $3,750 $3,750 $3,750 $3,750 $3,750 $3,750 $3,750 $3,750
IT Support $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250 $6,250
Total FTEs 8 8 8 8 8 8 8 8 8 8 8 8
Tot al Payroll $39,583 $39,583 $39,583 $39,583 $39,583 $39,583 $39,583 $39,583 $39,583 $39,583 $39,583 $39,583

26 | P a g e
Pro Forma Profit and Loss Mont h 1 Mont h 2 Mont h 3 Mont h 4 Mont h 5 Mont h 6 Mont h 7 Mont h 8 Mont h 9 Mont h 10 Mont h 11 Mont h 12
Sales $0 $0 $0 $0 $0 $0 $15,795 $31,590 $47,385 $98,180 $148,975 $199,770
Direct Cost of Sales $0 $0 $0 $0 $0 $0 $1,503 $3,006 $4,509 $9,512 $14,515 $19,518
Production Payroll $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Costs of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $0 $0 $0 $0 $0 $0 $1,503 $3,006 $4,509 $9,512 $14,515 $19,518

Gross Margin $0 $0 $0 $0 $0 $0 $14,292 $28,584 $42,876 $88,668 $134,460 $180,252

Gross Margin % 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 90.48% 90.48% 90.48% 90.31% 90.26% 90.23%

Operating Expenses

Sales and Marketing Expenses

Sales and Marketing Payroll $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Advertising/Promotion $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Sales and Marketing Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Sales and Marketing Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales and Marketing % 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Expenses
Payroll $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Marketing/Promotion $0 $0 $0 $0 $25,000 $30,000 $35,000 $40,000 $45,000 $75,000 $150,000 $175,000
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250
Internet $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
Utilities $450 $450 $450 $450 $450 $450 $450 $450 $450 $450 $450 $450
Hosting Fees $150 $150 $150 $150 $150 $150 $150 $150 $150 $150 $150 $150
Liscenses and Subscriptions $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250
Supplies $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200
Maintainence $700 $700 $700 $700 $700 $700 $700 $700 $700 $700 $700 $700
Insurance $600 $600 $600 $600 $600 $600 $600 $600 $600 $600 $600 $600
Professional Fees $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000
Payroll Taxes $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other $750 $750 $750 $750 $750 $750 $750 $750 $750 $750 $750 $750
Total Expense $9,850 $9,850 $9,850 $9,850 $34,850 $39,850 $44,850 $49,850 $54,850 $84,850 $159,850 $184,850
General and Administrative % 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Other Expenses:
Other Payroll $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Consultants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Other Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other % 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Total Operating Expenses $9,850 $9,850 $9,850 $9,850 $34,850 $39,850 $44,850 $49,850 $54,850 $84,850 $159,850 $184,850

Profit Before Interest and Taxes ($9,850) ($9,850) ($9,850) ($9,850) ($34,850) ($39,850) ($30,558) ($21,266) ($11,974) $3,818 ($25,390) ($4,598)
EBITDA ($9,850) ($9,850) ($9,850) ($9,850) ($34,850) ($39,850) ($30,558) ($21,266) ($11,974) $3,818 ($25,390) ($4,598)
Interest Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Taxes Incurred $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Other Income
Other Income Account Name $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Income Account Name $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Other Income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Other Expense
Other Expense Account Name $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Expense Account Name $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Other Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net Other Income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net Profit ($9,850) ($9,850) ($9,850) ($9,850) ($34,850) ($39,850) ($30,558) ($21,266) ($11,974) $3,818 ($25,390) ($4,598)
Net Profit/ Sales 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% -193.47% -67.32% -25.27% 3.89% -17.04% -2.30%

27 | P a g e
Pro Forma Cash Flow
Cash Received Mont h 1 Mont h 2 Mont h 3 Mont h 4 Mont h 5 Mont h 6 Mont h 7 Mont h 8 Mont h 9 Mont h 10 Mont h 11 Mont h 12
Cash from Operations
Cash Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Cash from Receivables $0 $0 $0 $0 $0 $0 $3,159 $18,954 $34,749 $57,544 $108,339 $159,134
Subtotal Cash from Operations $0 $0 $0 $0 $0 $0 $3,159 $18,954 $34,749 $57,544 $108,339 $159,134
Subtotal Cash Received $0 $0 $0 $0 $0 $0 $3,159 $18,954 $34,749 $57,544 $108,339 $159,134

Expenditures
Expenditures from Operations
Cash Spending $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Bill Payments $328 $9,850 $9,850 $9,850 $10,683 $35,017 $40,067 $46,570 $53,073 $60,526 $97,029 $175,365
Subtotal Spent on Operations $328 $9,850 $9,850 $9,850 $10,683 $35,017 $40,067 $46,570 $53,073 $60,526 $97,029 $175,365
Subtotal Cash Spent $328 $9,850 $9,850 $9,850 $10,683 $35,017 $40,067 $46,570 $53,073 $60,526 $97,029 $175,365

Net Cash Flow ($328) ($9,850) ($9,850) ($9,850) ($10,683) ($35,017) ($36,908) ($27,616) ($18,324) ($2,982) $11,310 ($16,231)
Cash Balance $1,449,672 $1,439,822 $1,429,972 $1,420,122 $1,409,438 $1,374,422 $1,337,514 $1,309,898 $1,291,574 $1,288,593 $1,299,903 $1,283,672

Pro Forma Ba la nce She e t Mont h 1 Mont h 2 Mont h 3 Mont h 4 Mont h 5 Mont h 6 Mont h 7 Mont h 8 Mont h 9 Mont h 1 0 Mont h 1 1 Mont h 1 2
Asse t s St a rt ing Ba la nce s
Current Assets
Cash $1,450,000 $1,449,672 $1,439,822 $1,429,972 $1,420,122 $1,409,438 $1,374,422 $1,337,514 $1,309,898 $1,291,574 $1,288,593 $1,299,903 $1,283,672
Accounts Receivable $0 $0 $0 $0 $0 $0 $0 $12,636 $25,272 $37,908 $78,544 $119,180 $159,816
Inventory $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Tot a l Curre nt Asse t s $1,450,000 $1,449,672 $1,439,822 $1,429,972 $1,420,122 $1,409,438 $1,374,422 $1,350,150 $1,335,170 $1,329,482 $1,367,137 $1,419,083 $1,443,488
Long-t e rm Asse t s
Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Tot a l Long-t e rm Asse t s $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Tot a l Asse t s $1,450,000 $1,449,672 $1,439,822 $1,429,972 $1,420,122 $1,409,438 $1,374,422 $1,350,150 $1,335,170 $1,329,482 $1,367,137 $1,419,083 $1,443,488

Lia bilit ie s a nd Ca pit a l Mont h 1 Mont h 2 Mont h 3 Mont h 4 Mont h 5 Mont h 6 Mont h 7 Mont h 8 Mont h 9 Mont h 1 0 Mont h 1 1 Mont h 1 2
Current Liabilities
Accounts Payable $0 $9,522 $9,522 $9,522 $9,522 $33,688 $38,522 $44,808 $51,094 $57,380 $91,217 $168,553 $197,556
Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subt ot a l Curre nt Lia bilit ie s $0 $9,522 $9,522 $9,522 $9,522 $33,688 $38,522 $44,808 $51,094 $57,380 $91,217 $168,553 $197,556
Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Tot a l Lia bilit ie s $0 $9,522 $9,522 $9,522 $9,522 $33,688 $38,522 $44,808 $51,094 $57,380 $91,217 $168,553 $197,556

Paid-in Capital $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000 $2,250,000
Retained Earnings -$800,000 -$800,000 -$800,000 -$800,000 -$800,000 -$800,000 -$800,000 -$800,000 -$800,000 -$800,000 -$800,000 -$800,000 -$800,000
Earnings $0 -$9,850 -$19,700 -$29,550 -$39,400 -$74,250 -$114,100 -$144,658 -$165,924 -$177,898 -$174,080 -$199,470 -$204,068
Tot a l Ca pit a l $1,450,000 $1,440,150 $1,430,300 $1,420,450 $1,410,600 $1,375,750 $1,335,900 $1,305,342 $1,284,076 $1,272,102 $1,275,920 $1,250,530 $1,245,932
Tot a l Lia bilit ie s a nd Ca pit a l $1,450,000 $1,449,672 $1,439,822 $1,429,972 $1,420,122 $1,409,438 $1,374,422 $1,350,150 $1,335,170 $1,329,482 $1,367,137 $1,419,083 $1,443,488

Ne t Wort h $1,450,000 $1,440,150 $1,430,300 $1,420,450 $1,410,600 $1,375,750 $1,335,900 $1,305,342 $1,284,076 $1,272,102 $1,275,920 $1,250,530 $1,245,932

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