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Description:
This Start-up owns two operating entities: A VoIP phone service and a photo printing and sharing service. Both services will target the incarcerated population in the U.S.
Our VoIP service is a low cost solution to expensive long-distance calls. This service simplifies the process of setting up virtual local numbers to enable users to save money when receiving calls from inmates or other long-distance friends and/or family members. The firm will compete on price and ease of platform. The firm’s greatest strength is that it will have the ability to target inmates nationwide at any institution. This service guarantees both the inmate and family member savings of up to 70% in phone cost per call.
Our Photo printing/sharing service is an internet-based service that combines real-time photo sharing with photo printing for the social networking generation. It lets consumers create and share printed photos from images stored on their computers, mobile phones and social network sites like Facebook and Flickr. These printed photo’s can then be sent anywhere in the world with a few clicks - simply put, we provide our users a quick, easy way to send their friends and family a Picture. The firm will generate revenue by printing and mailing each user’s digital photo prints.
Both Services are targeted at consumers who have limited financial resources, frequently use the internet, and often share what they're doing on social networking sites like Facebook, Twitter and Flickr. However in an effort to rapidly grow our initial user base we will specifically market our services directly to the family and friends of incarcerated individuals. Currently this large demographic has limited access to truly low cost calling solutions and little to no ability to easily share their mostly digital photo collections with loved ones who are incarcerated. The Firm has invested in the development of proprietary technology that allows the firm to specifically target this market by personally reaching individuals that are currently incarcerated all over the U.S. Any firms operating without such technology would be unable to capture this demographic leaving it mostly unattainable for commercial purposes. Upon solidifying this niche market, the firm will extend its services to the general public.
The firm will be initially overseen by the founders who will also form the start-up management team. The team has a strong mix of small business management experience and technological know-how.
In addition the team’s business management and technological know-how, two of the firm’s four member team are very familiar with the firms targeted customer profile as they were incarcerated at a young age for non-violent crimes. This gives the firm a unique advantage or “inside look” to the specific needs and how to meet those needs of this very large, virtually untapped market
The Firm estimates that it needs $175,000 to adequately capitalize the business. For the purposes of repayment estimation, a loan structure was estimated at $175,000, 5 year, 6.75%, monthly P&I. However, the management realizes that the $175,000 in capital might come in the form of an equity investment. The firm estimates that it can produce $1,850,000 in sales during year 1, with a net profit of $148,000. The team has already invested over $20,000 in the business start-up.
Assuming a $175,000 investment that acquires a 20% ownership in the company, the investment is expected to be worth $37,000,000 at the end of the first 5 years (assuming an earnings multiple of 10).