BUSINESS OVERVIEW
Paul Cleveland Corporation 404 Auhana Rd., Kihei, HI 96753 • (808) 870-1539
CONFIDENTIAL and PROPRIETARY THIS BUSINESS PLAN HAS BEEN SUBMITTED ON A CONFIDENTIAL BASIS. BY ACCEPTING DELIVERY OF THIS BUSINESS PLAN, THE RECIPIENT AGREES TO RETURN IT TO THE COMPANY AS DIRECTED BY THE OWNER. Revised 4/7/09
BUSINESS OVERVIEW
Paul Cleveland Corporation 404 Auhana Rd., Kihei, HI 96753 • (808) 870-1539
CONFIDENTIAL and PROPRIETARY THIS BUSINESS PLAN HAS BEEN SUBMITTED ON A CONFIDENTIAL BASIS. BY ACCEPTING DELIVERY OF THIS BUSINESS PLAN, THE RECIPIENT AGREES TO RETURN IT TO THE COMPANY AS DIRECTED BY THE OWNER. Revised 4/7/09
This project has great depth. Please review the 4 minute electronic press kit before diving in.
Extreme sports and music entertainment draws talent, sponsors and creates a strong connection with the buying power of Gen X and Y. SOCIAL NETWORKING TRENDS The social networking audience is growing rapidly. eMarketer estimates that in 2008 nearly 80 million people, 41% of the US Internet user population, visited social network sites at least once a month, an 11% increase from 2007. By 2013, an estimated 52% of Internet users will be regular social network visitors. eMarketer projects that 79.7 million people, 40% of US Internet users, will create content on social networks at least once a month in 2009, either by updating a profile or communicating publicly. That represents 90.5% of social network users—and a lot of stickiness. INTERNET BUYING TRENDS Online retail sales will likely keep climbing in 2009, even in the recession. According to projections from Forrester Research, U.S. online retail sales are expected to rise 11 percent to $156 billion this year, excluding revenue from travel. However, that will mark a slowdown in the overall growth rate, which was 13 percent in 2008, when online retail sales totaled $141 billion, Forrester says. Forrester analyst Sucharita Mulpuru said the majority of the 2009 growth in online spending will come at the expense of physical stores. She expects more consumer dollars to be spent online because it’s easier for people to comparison shop and to find what they’re looking for. Online sales are expected to make up 7 percent of overall retail revenue in 2009, compared with 6 percent in 2008. Online spending is expected to rise a robust 17% this year, despite a sluggish economy that has bruised many brick-based retailers, according to an annual survey to be released Tuesday. E-commerce “is clearly the bright spot in retailing,” said Scott Silverman, executive director of Shop.org. MUSIC INDUSTRY TRENDS Music and action sports entertainment is still in demand during a recession. Music CD sales are plummeting while concert tours and downloaded music remain highly profitable. In 2008, physical album sales fell 20 percent to 362.6 million (from 450.5 million), while digital album sales rose 32 percent to a record 65.8 million units. Digital track sales, such as those conducted in Apple Inc.’s iTunes Music Store, were up 27 percent from last year, breaking the 1 billion mark for the first time at 1.07 billion. • All facts are expanded upon in the statistical index.
PREFACE
Aloha and welcome to the Paul Cleveland Corporation. We offer a few key notes to help understand our products and the impulse behind our marketing strategy. This briefly summarizes our target market, the current buying trends in retail and the expanded use of the internet in 2008. We have based our company around these factors and is why our integrated, social networking, techno-driven products will thrive. THE BUYING POWER OF GENERATION X AND Y Today’s 18-to-40-year-olds are savvy, sophisticated, and immune to conventional marketing strategies, but the buying habits of this lucrative market can be anticipated. Generation X is reaching the height of its earning power and Generation Y enjoying more buying power than any previous generation of teens and post-teens. Gen Y represents more than 70 million consumers in the United States. They earn a total annual income of about $211 billion, spend approximately $172 billion per year, and considerably influence many adult consumer-buying choices. There are differences between the way Generation Y and Generation X view and use technology. Generation X uses technology as much as Gen Y but for X’ers they use technology when it supports a “lifestyle need.” Tech, however, is embedded into everything Gen Y’ers do, making them the first “native online population”. GEN X Stats * Born (1967-1978, 29 to 42 years old) * During the past three months, 69% have shopped online and 65% used online banking —more than any other group * 21% of Gen X are now reading a blog once per month compared to 15% last year * 61% of mobile subscribers text compared to 49% in 2007 GEN Y Stats • Born 1977-1998 / 75 million millennials * 90% of Gen Y own a computer * 82% own a mobile phone * 72% of Generation Y mobile phone users send or receive SMS messages * They spend more time online than they do watching television, with 42% watching online video at least once per month.
Music and action sports are still the selling power of America. . .
Your connection to this buying phenomenon is with the Paul Cleveland Corporation.
Table of Contents
pg 4
A) EXECUTIVE SUMMARY
pg 5
pg 8
B) DESCRIPTION OF BUSINESS
pg 9
1. Maui Green Wave速 Marketing
pg 11
a: Ballistic TV速
pg 13
b: MyBTVTube.com
pg 15
c: Ambush Tour
pg 17
2: Maui Cruzer速
pg 18-19
3: Brand Image
pg 20-21
C) BUSINESS STRATEGY
pg 22
1. Sponsorship Pricing
pg 23
2. Competitive Analysis
pg 24
3. Growth Strategy
pg 25
4. Marketing Plan
pg 27
5. Operations Plan
pg 26
a. Business Milestones
pg 26
b. Management Team
pg 28-29
CORPORATE STRUCTURE CHART
D) FINANCIAL SUMMARY
pg 30
1. Revenue/Cost Overview
pg 31
REVENUE STRUCTURE CHART
pg 32-35
3. Annual Financial Summaries
pg 36-38
E) INVESTMENT OPPORTUNITY
pg 39
INVESTMENT STRUCTURE CHART
pg 40-55
F) STATISTICAL INDEX
pg 56-62
G) MEDIA EXPOSURE
EXECUTIVE SUMMARY
Welcome to the Paul Cleveland Corporation (PCC). Our business is: • Action Sports and Music Entertainment • Owner and Operator of Maui Green Wave® Marketing • Executive Producer of Ballistic TV® • Design and Manufacture of Maui Cruzer® action sports hard goods and soft goods Our mission is to deliver brands, talent and products to a powerful consumer group through a one-of-a-kind marketing strategy. Our plan is designed specifically to be profitable in challenging economic conditions. Over a three year period of operation we conservatively estimate our profits at over $22 million, positioning PCC for a potential buyout value between $20 and $30 million collectively. PCC is the parent company of Maui Green Wave® which operates a series of action sports based products including a broadcast television series, a user based “share-site”, a national event tour and a product line inclusive of hard goods, soft goods and accessories under the Maui Cruzer® brand. In addition, Maui Green Wave® Marketing offers innovative advertising, sales and marketing packages to corporate sponsors who seek integrated promotions that target the valuable, viable Gen X and Y consumer. All of the PCC businesses are positioned for rapid growth through their participation and exposure in the Maui Green Wave® Marketing plan. PCC distributes costs and draws revenue from each of its diversified business products and is seeking $1,000,000 in investment capital in the form of seed money to bring our products to market.
( Page 4 )
2009 Corporate 2009 Structure Corporate Structure
Paul Cleveland Paul Corporation Cleveland Corporation
Maui Cruzer® Maui Cruzer®
Branded products, accessories, soft goods and promotional items
Branded products, accessories, soft goods and promotional items
Owner and operator of Maui Green Wave® businesses, developer and agency for Maui Green Wave® Marketing Owner and operator of Maui Green Wave® businesses, developer and agency for Maui Green Wave® Marketing
Maui Green Wave®
Maui Green Wave®
Brand identity for products, productions and business operations
Brand identity for products, productions and business operations
Ballistic TV® Ballistic TV®
Action sports and music publishing, advertising and marketing
MyBTVTube.com MyBTVTube.com
Ambush Tour Ambush Tour
A community “share-site” (5) city national event tour featuring action sports, music, video, featuring action sports, music, web commerce and marketing sales and promotion Action sports and music publishing, A community “share-site” (5) city national event tour advertising and marketing featuring action sports, music, video, featuring action sports, music, web commerce and marketing sales and promotion
Through our first two seasons of Ballistic TV® in Hawaii we tested the market, developed our brand and claimed a position in the entertainment and action sports industries. From here we’ve developed our marketing strategy to position and introduce our products with full market power. In an integrated businesses form (see above diagram) we position ourselves as a startup company, but we have considerably more than start up.
( Page 5)
PERFORMER
The Paul Cleveland Corporation has over 10 years of the research and development behind our products. Through extensive market testing, through our own lessons and those of the many companies who have paved to way before us, we have developed a modern strategy for success. Our products are in demand, our audience is viable and we are ready to bring our innovative offerings to a larger market. VALUE Our investment collateral is in the form of operating goods and inventory valued at over $1.3 million. Additional value for our company comes from our brand equity. This has been earned through extensive media placement, through the notoriety gained from two seasons of broadcast television, from the achievements of our world championship team and from the industry alliances we have established. POSITION Our products have achieved recognition from the elite in the action sports, music and television industries. Our brand is synonymous with innovation, quality and performance. Our image has been published all over the world in print, television, film and the web. Our products captivate people everywhere we go. DEMAND Demand for our products has reached a tipping point. We are ready to introduce our brand and products to millions of Gen X and Y consumers in a sustainable, profitable business form that accommodates rapid growth over a short period. SUCCESS We consider our greatest asset to be the development of our business strategy. It is the single most important element in this project and is a powerful means to provide growth, profit and success even in a down economy.
( Page 6 )
OPERATIONAL ASSETS
INVENTORY
A) Full digital and analog production studio including software and hardware, cameras, editing equipment,
D) 20 completed BTV shows, 12 edited segments, 500 hours of action sports B roll footage (in1080i HD)
= $250,000 B) Multiple websites, multiple registered names, dedicated webspace and infrastructure
= $10,000 C) Patents, Copyrights, Trade Marks and Legal Development
= $20,000
= $1,000,000 E) CGI animated character “Kolo”
= $25,000 F) Published DVD’s including Ten Years Later
= $30,000 G) 6 Motorized skateboard prototypes, skateboarding hard goods, soft goods, accessories
= $100,000
TOTAL ASSET VALUE: $ 1,360,000 + Brand Equity + Development ACHIEVEMENTS • We have broadcast (2) seasons of Ballistic TV® in Hawaii (KWHE & K5 NBC Affiliate) in 1997 and 2002. This provided world wide interest, product recognition and a positive market position within the television, music and action sports industries. • We have an alliance with Sandbox Marketing to provide event management, production and promotion for all events of the Ambush Tour. Sandbox has run successful nationwide events since 1999 and they are proven experts in the field. • We have developed relationships with key manufacturers for each of our products. Efficient design, engineering and sourcing has enabled us to achieve the highest quality merchandise while retaining excellent sales margins. Our product development is complete, market tested over several years, and we are ready to bring our innovative products to market. • Our skate and dirtboard products have garnered numerous titles, gold medals and championships in boarder-cross racing and big air events since 1997. • Our brand and team have drawn international media interest (OLN Awe television series, MTV’s Living Lahaina, MTV Road Rules Brazil, Planet X television, 8 page article in British GQ Magazine) and continue to captivate the world.
( Page 7)
If you find this interesting so will 40-50 million other people...
ing,
INTEGRATION Maui Green Wave® represents the synergy of four unique businesses that form a symbiotic relationship. Each facet of the plan supports each other, their products and talent. Expenditures are shared to lower operating costs while profits are pooled to create sustainability and growth. It is the synergy of these businesses - the way they cross market and fuel each other - that makes this plan work in short and long terms. 2009 Corporate Structure
DESCRIPTION OF BUSINESS
Paul Cleveland
• MAUI GREEN WAVE® MARKETING (Integration of 3 businesses)
Corporation
Owner and operator of Maui Green Wave® businesses, developer and agency for Maui Green Wave® Marketing
Brand identity for products, productions and business operations
A community “share-site” featuring action sports, music, video, web commerce and marketing
• MyBTVTube.com
Maui Green Wave®
MyBTVTube.com
• BALLISTIC TV®
• AMBUSH TOUR • MAUI CRUZER®
Ambush Tour (5) city national event tour featuring action sports, music, sales and promotion
( Page 8)
Maui Green Wave
®
(Sales and marketing)
MAUI GREEN WAVE® MARKETING is an integrated sales and promotional program that utilizes music and extreme sports entertainment to capture the attention of a valuable target market (Generation X and Y). We will position our sponsors with creative branding and deliver our message through television, internet and live events to an estimated 40 - 50 million viewers weekly. We have identified the most effective promotional venues in action sports and integrated these strategies to form a one-of-a-kind marketing machine that aggressively promotes brands, products and talent. UNIQUE / COMPETITIVE ASPECTS • Currently the only marketing venue to combine: - The sell power and exposure from broadcast television - The community interaction of a web “share-site” (similar to YouTube and MySpace) - The direct audience connection from a live event tour • Satisfies the modern consumer’s desire for community, entertainment and discovery • Pricing is parallel to the sponsorship packages offered in the Core Tour (2006) with considerable added value of television and internet promotion at minimal additional cost PRODUCTS / SERVICES OFFERED • Sponsorship packages offering cross market promotion in all venues of the program • A la carte advertising and sponsorship opportunities offered in select venues of the program • Sales and distribution of product through web commerce and direct sales at events • Database marketing programs GEOGRAPHICAL AREA OF LOCATION • USA FACILITIES AND EQUIPMENT • (2) Offices of operations (San Diego, CA and Kihei, Maui HI), production studio OWNERSHIP STRUCTURE • C Corporation KEY PERSONNEL AND STAFF ARE PROVIDED BY THE PAUL CLEVELAND CORPORATION
( Page 9 )
2009 Corporate Structure FINANCIAL SUMMARY & PROJECTION TOTAL REVENUE / 3 YEARS $ 22,436,960 TOTAL COSTS / 3 YEARS - $ 11,278,500
Paul A community “share-site” TOTAL PROFIT / 3 YEARS featuring action sports, music, video, Cleveland web commerce and marketing
Action sports and music publishing, advertising and marketing
National event tour featuring
= $ action 11,165,460 sports, music, sales
Corporation
Maui Cruzer® Branded products, accessories, soft goods and promotional items
and promotion
REVENUE • Sponsorship and advertising sales are the main of Wave® revenue for this project Owner and operator ofsource Maui Green businesses, developer and agency for Maui Green Wave® Marketingmerchandising (DVDs, movies and branded • Product
products) provides additional revenue
• Syndication Maui Green Wave® or licensing of the series in world markets offers long term revenue potential
Brand identity for products, productions and business operations
PRODUCTS/SERVICES OFFERED • Production and distribution of high quality action sports and music content, branded items advertising and promotions
Ballistic TV®
MyBTVTube.com
Ambush Tour
GEOGRAPHICAL AREA OF LOCATION • Produced in Maui, Hawaii, filmed all over the world Action sports and music publishing, • (2) Offices A community “share-site” (San Diego, (5) city national event tour FACILITIES AND EQUIPMENT of operations CA and Kihei, Maui HI). advertising and marketing featuring action sports, music, video, featuring action sports, music, Full digital and analog production studio including software and sales hardware in excess of $250K. web commerce and marketing and promotion Television, web, film and DVD producing capabilities.
INVENTORY • Stock and inventory in excess of (20) completed shows, (12) edited segments, (500+) hours of action sports B roll footage, CGI animated character “Kolo”, published DVD’s including Ten Years Later, Lava Boys, Full Turn and new projects in value of $1,000,000 + KEY PERSONNEL AND STAFF ARE PROVIDED BY THE PAUL CLEVELAND CORPORATION EXTERNAL RESOURCES needed for the operation of Ballistic TV® brand of product are: • Sierra Emory —Maui correspondent, senior host • Akoni Kama —International correspondent, cohost • Caliber Entertainment – Talent management, sales and contract originator, as well as providing access to industry giants and promising up-and-comers • T.B.D. – Advertising sales agents / account executives responsible for securing and providing service to corporate sponsors and advertisers • Media Buyer — Provides contractual agreements and purchase of media venues
( Page 10 )
Ballistic TV
® (Television, branded products and promotion)
Established in 1997, this series was developed to market Maui Cruzer® products through broadcast television. Ballistic TV® (BTV) features a captivating combination of extreme sports and music throughout a (39) show season. Our focus is to become the most recognized Action Sports and Music based Television Series in existence and to provide a powerhouse marketing vehicle for corporate sponsors. Our program captivates the “Generation X and Y” interest in action sports and music. “Super Culture” spending is one of the most powerful markets in the word today and television association is the cornerstone for direct contact with this purchasing phenomenon. ACHIEVEMENTS • Exposure gained through the first (2) seasons of broadcast in Hawaii (KWHE & K5 NBC Affiliate) provided world wide interest, product recognition and a positive market position within the television and action sports industries.
Paul Cleveland
UNIQUE / COMPETITIVE ASPECTS • Through the introduction of MyBTVTube.com, BTV will be structured to receive licensed amateur video content from a global community. Discovering talent from every corner of the world and featuring this talent on broadcast television is a first in action sports.
Corporation
Owner and operator of Maui Green W
® the program. Maui Cruzer • The ability to receive HD amateur footage will greatly reduce the operating costs of businesses, developer and agency Maui Green Wave® Marketing As submissions grow, this footage will provide the main source of material for our show.
Branded products, accessories, • Our animated character “KOLO” draws serious interest from a wide demographic while providing access soft goods and promotional items to a younger generation. Once seen-never forgotten, Kolo is unique and strategic to action sports Maui Green Wave® entertainment and will provide product merchandising opportunities.
• Our unique strategy of purchasing “infomercial” broadcast blocks enables us to produce undiluted Brand identity for products, content and the ability to re-sell advertising slots to a select group of sponsors. productions and business operati • We have incorporated many innovative production techniques that define our look and product, including the use of remote helicopter cams, rider cams and computer generated animation.
• We are the only music and action sports based program that offers up and coming video editors and Ballistic TV® MyBTVTube.com cinematographers direct access to publish their work on broadcast television. Action sports and music publishing, advertising and marketing
(Page 11)
A community “share-site” featuring action sports, music, vid web commerce and marketing
d music publishing, and marketing
FINANCIAL SUMMARY & PROJECTION TOTAL REVENUE / 3 YEARS $ 4,325,000 TOTAL COSTS / 3 YEARS - $ 2,465,150 A community “share-site” featuring action sports, music, video, web commerce and marketing
National event tour featuring action sports, TOTAL music, sales PROFIT / 3 YEARS and promotion
= $ 1,859,850
REVENUE • Sponsorship and advertising sales are the main source of revenue for this project
Pau Clevel Cle
• Product sales through our web store
Corpor Co
• Repackaged content in the form of DVDs, downloads, CDs and branded promotional merchandise • Database marketing programs ® ® Maui Maui Cruzer Cruzer
OwnerOwner and operator and opeo businesses, businesses, develop de Maui Green Maui Gree Wav
Branded products, accessories, Branded products, accessories, soft goods and promotional soft goods and promotional items items
PRODUCTS/SERVICES OFFERED • Internet publishing, advertising, promotions, web commerce, sales and distribution of branded items, database marketing GEOGRAPHICAL AREA OF LOCATION • World Wide Web
Maui Maui Gree G
Brand Brand identity id productions productions and bu
FACILITIES AND EQUIPMENT • (1) Office of operations (Kihei, Maui HI). INVENTORY • Multiple websites, multiple registered names, dedicated webspace and infrastructure
Ballistic Ballistic TV®TV®
MyBTVTu MyBT
KEY PERSONNEL AND STAFF ARE PROVIDED BY THE PAUL CLEVELAND CORPORATION
EXTERNAL RESOURCES needed for the operation of MyBTVTube.com brand ofAction product are: Action sports sports and music and music publishing, publishing, advertising advertising and marketing and marketing
• Web management, development and production • T.B.D. – Advertising sales agents / account executives responsible for securing and providing service to corporate sponsors and advertisers
( Page 12)
A community A comm featuring featuring actionact sp web commerce web comm
MyBTVTube.com
(Website, branded products and promotion)
2009 2009 Established Corporate Corporate in 2008, this business represents the future of Structure theStructure Paul Cleveland Corporation. Our goal is to become the
most visited Action Sports and Music based website on the internet... and a powerful marketing vehicle for internet advertising and corporate sponsorships.
ulPaul eveland land
Our website is designed for public interaction and community development (similar to Facebook and orporation ration MySpace). Our intention is to reveal backyard talent from every corner of the planet and deliver “intertainment” erator of Maui ofGreen Maui Green Wave®Wave® per eveloper and agency and agency for for through television-style programing (not just clips). ve® en Wave® Marketing Marketing High quality, licensed music and action sports video will be shared and available for amateur editing. This will provide ® ® Green en Wave Wave user-generated segments for viewing and voting. The most dentity for products, for products, popular segments will be featured on Ballistic TV® and the usiness and business operations operations most credible talent will compete with industry giants on the Ambush Tour. Community, discovery and fame.
Tube.com TVTube.com
Ambush Ambush TourTour UNIQUE / COMPETITIVE ASPECTS
ymunity “share-site” “share-site” (5) city(5) national city national event tour event tour ports, tion sports, music,music, video, video, featuring featuring actionaction sports, sports, music,music, • Providing television formatted “intertainment” on the internet is the future of the web. merce and marketing and marketing sales and sales promotion and promotion
• This is the only music / action sports based website to receive licensed amateur video content and publish audience edited segments on television. • Discovering talent through the internet and featuring talent in competition with the pros (on the Ambush Tour) is an action sports first. • Our web store sells our products direct to a growing customer base, providing higher margins on sales, lower cost to consumers and additional revenue from sales of sponsor’s products. • We offer our sponsors additional access to our valuable target market through database marketing opportunities.
(Page 13)
hare-site” s, music, video, d marketing
FINANCIAL SUMMARY & PROJECTION TOTAL REVENUE / 3 YEARS $ 10,999,500 TOTAL COSTS / 3 YEARS - $ 4,662,500 National event tour featuring action sports, music, sales and promotion
TOTAL PROFIT / 3 YEARS
= $ 6,337,000
REVENUE • Corporate and regional sponsorship are the main source of revenue for this project • Retail, food and beverage sales
PauP Clevel Cle
• Vendor booth sales
Corpor Cor
• Media content publishing and distribution
® ® Maui Maui Cruzer Cruzer
Owner Owner and operator and opero businesses, businesses, develop de Maui Maui GreenGree Wav
PRODUCTS/SERVICES OFFERED • Action sports and music events, advertising, marketing and Branded products, accessories, Branded products, accessories, soft goods and promotional soft goods and promotional itemsitems merchandise sales GEOGRAPHICAL AREA OF LOCATION • Hawaii and US Mainland FACILITIES AND EQUIPMENT • Office of operation (San Diego, CA), Corporate headquarters in Kihei, HI)
Maui Maui Gree G
BrandBrand identity ide productions productions and bu a
KEY PERSONNEL AND STAFF ARE PROVIDED BY THE PAUL CLEVELAND CORPORATION EXTERNAL RESOURCES needed for the operation of the Ambush Tour brand Ballistic of product are: ®TV® Ballistic TV
MyBTVTu MyBT
• Akoni Kama —International correspondent, master of ceremonies, brand manager Action Action sportssports and music and music publishing, publishing, advertising advertising and marketing and marketing • Sandbox Marketing – Event management, sales, promotion and production
• Caliber Entertainment – Talent management, sales and contract originator, as well as providing access to industry giants and promising up-and-comers • T.B.D. – Advertising sales agents / account executives responsible for securing and providing service to corporate sponsors and advertisers
( Page 14)
A community A comm featuring featuring actionacti sp web commerce web comm
Ambush Tour
®
Designed to launch in 2009, this is ambush marketing at 2009 2009 Corporate itsCorporate best. The Ambush Tour is cross-marketed with Ballistic Structure Structure
TV® and MyBTVTube.com to further our messaging to the Generation X and Y demographic. We jump to the streets of five metropolitan hubs in America to generate a street level connection with our community through heart stopping extreme sports and live music entertainment.
ul Paul eveland land
ration rporation
of rator Maui of Maui GreenGreen Wave® Wave® eveloper per and agency and agency for for en ve® Wave® Marketing Marketing
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entity for products, for products, and usiness business operations operations
Tube.com TVTube.com
munity y “share-site” “share-site” ports, ion sports, music,music, video,video, merce and marketing and marketing
(Live events, branded products and promotion)
The Ambush Tour provides fantastic branding for our sponsors while creating the opportunity to interact authentically with this valuable target market. Sponsorship packages, vendor booth sales and merchandising are proven sources of revenue for the tour. Media generated from the events are published on Ballistic TV® and MyBTVTube.com and are repackaged for promotional use by sponsors.
OPERATIONS • We have created an alliance with Sandbox Marketing to provide event management, production and promotion for all events of the Ambush Tour. Sandbox has run successful Ambush Ambush Tour Tour nationwide events since 1999 and are an established force in the music, action sports and live event promotion industry. This alliance allows us to focus on the venue with our sponsors in (5) city (5)national city national eventevent tour tour mind andaction provides further opportunity to participate in other events they are promoting. featuring featuring action sports, sports, music,music, sales sales and promotion and promotion
UNIQUE / COMPETITIVE ASPECTS • The most unique aspect of the Ambush tour is the attraction of amateurs to compete on stage against industry giants from the extreme sport and music industries. • The event locations are strategically positioned in the heart of metropolitan cities to maximize our promotional impact, draw out large audiences, local talent and regional sponsors. • Out-sourcing the entire tour’s production to Sandbox Entertainment is strategic, functional and provides a quantifiable business model to follow (complete with fixed annual costs and a well developed sponsorship model to implement for promotion and sales of the tour).
(Page 15)
FINANCIAL SUMMARY & PROJECTION TOTAL REVENUE / 3 YEARS $ 8,950,000 TOTAL COSTS / 3 YEARS - $ 5,855,700 Branded products, accessories, soft goods and promotional items
TOTAL PROFIT / 3 YEARS
= $ 3,094,300
REVENUE • Wholesale and retail sales are the main source of revenue for this project • Service, accessory and replacement part sales will provide a long term stream of revenue
USA Retailers
Pau Pa Clevel Cleve
Corpor Corpo
Maui MauiCruzer Cruzer®® MAUI CRUZER PRODUCTS/SERVICES OFFERED • Manufacture and distribution Brandedproducts, products, accessories, Branded accessories, of specialized action sports products, accessories, soft goods & promotions softgoods goodsand andpromotional promotionalitems items soft
Maui MauiGree Gree
GEOGRAPHICAL AREA OF LOCATION • Hawaii, US Mainland and World Wide Web FACILITIES AND EQUIPMENT • Office of operation (San Diego, CA), Corporate headquarters in (Kihei, HI), distribution warehouse (San Diego, CA) Action sports and music publishing,
Owner Ownerand andoperator operatoro businesses, businesses, develop develo Maui MauiGreen GreenWav W
Brand Brandidentity identit productions productionsand andbub
A community “share-site”
National event tour featuring
web commerce and marketing
and promotion
INVENTORY • Patents, Hard goods, Soft Goods and featuring Accessories in excess value of $25Kaction sports, music, sales advertising and marketing action sports, music, video, KEY PERSONNEL AND STAFF ARE PROVIDED BY THE PAUL CLEVELAND CORPORATION
Ballistic BallisticTV TV®®
EXTERNAL RESOURCES needed for the operation of the MAUI CRUZER® brand of product are: Action Actionsports sportsand andmusic musicpublishing, publishing, • Akoni Kama —Brand Manager / Team Manager / Brand Correspondent - providing international recognition from his TV and movie celebrity status and world champion dirt-board titles • T.B.D. – Sales reps / account executives responsible for securing sales and distribution • T.B.D. – Customer service representative Cane Fire Cruzer
50CC Motorized Cost to Manufacture: $ 300 Retail Sale Price: $ 990
( Page 16)
advertising advertisingand andmarketing marketing
MyBTVTu MyBTVT
A Acommunity communi featuring featuringaction actionsps web webcommerce commerc
aul ul eland land
oration ration
Maui Cruzer
® (Branded products)
It all began in 1997 with the dream of taking street skateboarding off-road. Since then we have taken our dirtboard and skateboard Retail Sale Price: $99 products to task. The achievements and exposure generated by our world champion team has earned Maui Cruzer® the respect of the industry’s elite and our innovative products have captured the interest of the world. The motorized skateboard is our most unique product to date and exceeds all expectations for development. Other specialty items include dirt boards, lighted boards, long boards, clothing and accessories. 2009 2009 Corporate Corporate Kriminal Kruzer Structure Structure Manufacture Cost: $30
of r ofMaui MauiGreen GreenWave® Wave® per operand andagency agencyfor for Wave® ve® Marketing Marketing
The Maui Green Wave® Marketing strategy will deliver the Maui Cruzer® brand and products to a nation of Generation X en enWave Wave®® and Y consumers. This is our test product and Maui Green Wave® is the application. Revenue is derived primarily from wholesale tyfor forproducts, products, usiness businessoperations operationsand retail sales.
Tube.com Tube.com
ACHIEVEMENTS Our products have garnered numerous titles, gold medals and championships in boarder-cross racing Ambush Tour1997. Our brand and team have drawn international media interest (OLN Awe and bigAmbush air events Tour since television series, MTV’s Living Lahaina, MTV Road Rules Brazil, Planet X television, 8 page article in British GQ Magazine) and continue (5)(5)city citynational national event eventtour tourto captivate the world.
yity “share-site” “share-site” ports, sports, music, music, video, video, ceand andmarketing marketing
featuring featuringaction actionsports, sports, music, music,
salesand andpromotion promotion UNIQUEsales / COMPETITIVE ASPECTS
• We have developed a broad range of products to meet the needs of action sport enthusiasts. • Branded products from Hawaii offer a distinct advantage in establishing market recognition. • Our animated character “KOLO” is unique to action sports marketing, draws serious interest from a wide demographic and provides incredible merchandising opportunities for the Maui Cruzer® brand. • To date no other motorized skateboard rivals the Maui Cruzer®. • We offer the only skateboard that easily converts from a street board to a dirt board. • Our engine Cruzer® has outlasted all other manufacture’s motorized skateboards. • Our lighted skateboard is a novelty product that has generic appeal and offers the potential to outsell our entire product line.
(Page 17)
“Kolo” - the original Maui Cruzer
3D CGI animated character + voice • Cost of Development: $25K
PauP Cle Clevel
“Kolo”
Corpor Cor
Kolo is our proprietary CGI animated character. His wipe-outs and “anything you can do I can do better” attitude positions him to become the “MickeyOwnerOwner and operator and opero ® ® Maui Maui Cruzer Cruzer businesses, businesses, develop de Mouse” of action sports marketing.
Maui Maui GreenGree Wav
Branded Branded products, products, accessories, accessories, soft goods soft goods and promotional and promotional itemsitems
Maui Maui Gree G
BrandBrand identity ide productions productions and bu a
Akoni Kama is the international correspondent of Ballistic TV®. Known as “AK” throughout the industry, he pushes the limits for the extreme athlete through his competitive achievements (7 time dirtboard champion) and marketability. His dreadlock image and Hawaiian bloodline puts him at the forefront of our promotional strategies. Akoni brings BTV® and Kolo with him every time he embarks on a new world adventure. Akoni has made a name for himself in media publications such as OLN, ESPN, Ballistic TV®, CNN, Fox Sports Net, and the BBC. He has been featured in national television commercials for Honda, Subway, in GQ magazine and in the collector edition of Playboy. His greatest media association has come from his role in the new Disney mountain boarding movie Johnny Kapahala Back on Board!
( Page 18)
Ballistic Ballistic TV®TV®
MyBTVTu MyBT
Action Action sportssports and music and music publishing, publishing, A community A comm advertising advertising and marketing and marketing featuring featuring actionacti sp web commerce web comm
PCC Brand Image
2009 2009 Corporate Corporate We make it a priority to be current with the ever Structure Structure
changing movements of the action sports and music industries. To maintain this connection we strategically employ industry specialists to provide “insider” access to talent and happenings within these industries. Access alone, however, is not enough.
ul Paul eveland land
ration rporation
of rator Maui of Maui GreenGreen Wave® Wave® eveloper per and agency and agency for for en ve® Wave® Marketing Marketing
® ® Green en Wave Wave
We have identified the need to offer a unique and compelling image to represent our branded products and initiatives in this trendy marketplace. For this reason we feature extreme sports personality Akoni Kama as our brand correspondent. To widen our appeal and further differentiate ourselves we have developed “Kolo” - our proprietary animated character.
entity for products, for products, and usiness business operations operations
Tube.com TVTube.com
munity y “share-site” “share-site” ports, ion sports, music,music, video,video, merce and marketing and marketing
ACHIEVEMENTS “Kolo” was first introduced to the world in season two of BTV® with extremely positive
Ambush Ambush Tour Tour response. Our next season features “Kolo” with “Akoni Kama” as “The Dreaded Duo.” They
embark on mischievous journeys throughout the series and show up at world wide locations. They draw serious (5) city (5) national city national eventevent tour tour interest and provide a powerhouse association for our brand and sponsors featuring featuring actionaction sports, sports, music, music, alike. Once seen never forgotten, these two captivate a wide demographic of viewers and sales sales and promotion and promotion offer a unique connection to the Generation X and Y audience. UNIQUE / COMPETITIVE ASPECTS • Always on the cutting edge, Ballistic TV® and Maui Cruzer® utilize a cartoon character and elite athlete to form a unique association for our brand image. • This combination provides instant recognition, credibility and access to a wider audience. • Kolo is utilized in creative branding and product promotion with our sponsors. • Merchandise featuring the “Dreaded Duo” will provide additional revenue. • “Kolo” provides expanded promotional opportunities in television, web and film.
(Page 19)
BUSINESS STRATEGY
• COMPETITIVE ANALYSIS • SPONSORSHIP PRICING • MARKETING PLAN • GROWTH • MANAGEMENT TEAM
It’s big, it’s gnarly. How do we plan on pulling this off?
zer®
essories, onal items
c TV®
usic publishing, marketing
2009 Corporate Structure
Sponsorship Pricing Paul
Clevelandof one full year of promotion in Maui Green Wave® - Example Corporation
Our marketing program has been designed to accommodate the current business environment. We offer value added products Owner and operator of Maui Green Wave® withdeveloper highly competitive pricing designed to sustain our programs businesses, and agency for Maui Green Wave® Marketing and generate substantial returns. • $1,000,000 Maui GreenCHARTER Wave® SPONSORSHIP - Includes marketing and promotion on broadcast
television (1.5 minutes per show x 39 shows total), Front row billboard and promotion in a live tour, internet advertising, database marketing and product sales identity for products, 3Brand Total Sponsors = $ 3,000,000 revenue productions and business operations • $250,000 (8) SUB SPONSORSHIPS - Includes promotion on broadcast TV, promotion in a live tour, internet advertising, database marketing and product sales 8 Total Sponsors = $ 2,000,000 revenue
MyBTVTube.com
Ambush Tour
• LOCAL SPONSORS providing additional tags, product placement, host verbal plugs, etc. $1,200.000.00 revenue A community “share-site” (5) city national event tour featuring action sports, music, video, web commerce and marketing
featuring action sports, music, sales and promotion
TOTAL SPONSORSHIP REVENUE FOR 1 YEAR: $6,200,000
MARKET VALUE OF SPONSORSHIP Sponsorship costs are based on the current market value of television advertising combined with the sponsorship costs from previous action sports tours (Core Tour 2006). Our promotion will reach an estimated 40 - 50 million viewers per episode, 400,000 viewers through live events and 300,000 via internet = annual estimated total of 1.6 billion viewers. ANNUAL CHARTER SPONSORSHIP PROMOTIONAL VALUE: • Ballistic TV® Advertising Value: 1.5 min / show = $16,800 x 39 shows = $ 655,200 market value • Ambush Tour Promotional Value: $700,000 • MyBTVTube Advertising Value: $25,000 • Misc. Promotional Value of sponsor footage generated on tour: $25,000 TOTAL PROMOTIONAL VALUE: $ 1,405,200 (+ product sales and brand equity)
( Page 22)
Maui Green Wave®
Competitive Analysis Compelling entertainment is still in demand during a recession. Music CD sales are at an all time low while concert tours and downloaded music remain highly profitable. Celebrity music tours, action sports oriented events, television shows and websites continue to validate the value of Generation X and Y audiences (and their buying power). Several players similar to Ballistic TV® are vying for top position to deliver action sports and music entertainment to this powerful consumer group. We have competitors that entertain on television, in a live tour, or on the internet, however no one in our niche is combining all three marketing platforms in one promotional package. Our price and the market value of our sponsorship is competitive, quantifiable and easy to participate in. The current economic climate positions us strategically for an all out assault on the market. Many companies (Vans, Boost) are not continuing their own tours this year but have established the value of this form of marketing. For a small portion of our target sponsor’s promotional budget, we offer extensive reach and an elaborate cross-marketing opportunity. As an investor, this is a unique opportunity to access a thriving market in a difficult economy.
DESCRIPTION OF COMPETITORS The following matrix provides information about the main competitors in the nation that provide like services:
Direct Competitors NAME POSITION
COMMENTS
Resort Living Network
Action Sports TV series
North East Region, successful
Fuel TV
Action Sports TV Station
A proven promotional venue
X Games
Premier Action Sports TV Event
Annual event is a media giant
Dew Tour
Action Sports Competition Tour
Effective brand promotion
Tony Hawk Huck Fest
Celebrity Extreme Tour
Premier live action sports + music
Concert Tours
The premier community venue
Money makers in 2008
Havoc.TV
Music + action sports website
Edited programing, emerging
Indirect Competitors
NAME POSITION
COMMENTS
YouTube.com
Video share site / marketing tool
Internet traffic / network leader
MySpace.com
Video share site / marketing tool
Internet traffic / network leader
Fuse TV
Web Action Sports entertainment
The power of action sports marketing
( Page 23)
2009 Corporate Structure
Paul Cleveland Corporation
Paul Cleveland Corporation
Growth Strategy SHORT TERM Exposure from Maui Green Wave® Marketing will result in increased demand for all of the Maui Green
d operator of Maui Green Wave® products and promotions. We are prepared to expand rapidly through this exposure. We will Wave® es, developer and agency for continue our marketing program for a target of (3) years with expanded promotions throughout the i Green Wave® Marketing
second and third year.
ui Green Wave•®It is the buying trends on the internet that offer the most potential
for growth and is where we focus our greatest efforts in development.
nd identity for products, ions and business operations
LONG TERM
The internet is now of age as demonstrated by President Obama in his 2008 campaign strategy. Consumers continue to prove the buying power of the internet ($204 billion online sales in 2008). yBTVTube.com Tour in on internet opportunities. Many websites are vying for top position Every major Ambush network is cashing in the action sports and music sharing market but no one is applying a strategy to promote their websites like we will. community “share-site” (5) city national event tour
g action sports, music, video, featuring action sports, music, Initially we will introduce our websites through elaborate cross-promotion on broadcast television, commerce and marketing sales and promotion
print, internet and live events. This will rapidly develop our audience base and deliver our message to the millions that anyone who wants to showcase their talents on television, internet and on stage now has direct access through our website. LONG TERM DEVELOPMENTS
• It is our goal to reveal fresh new talent from every corner of the planet through the ease of the internet. • Through this goal we will develop a large web audience - which is the key to the future success of the PCC - as sales and distribution through the internet is the future of retail. • Internet and technology is the medium of choice for the generation X and Y consumer and is the purpose behind the strong amount of web emphasis in our business. • The internet community will not only drive our entertainment content but deliver creative input for our marketing, product designs and the development of new product offerings. • Other long term growth will stem from the implementation of our internet television network, complete with programming, episodes and vast, far reaching viewership. This will become known as “Intertainment”.
( Page 24 )
Maui Green Wave®
Marketing Plan PRODUCT Our marketing product is unique in many aspects. We have developed a master strategy to deliver integrated marketing to a valuable consumer segment and have carefully waited for the right moment to present our offerings. A growing list of corporate sponsors have participated in similar marketing efforts over the past decade and are proof of the need and viability of our product. We have calculated our price to be extremely attractive in the current economic climate and are eager to present our products to a growing list of target sponsors who need a better promotional vehicle. PROMOTION We have established, experienced sales agents to review our product with potential sponsors who have expressed considerable interest in our marketing program. We will market our product through a series of private meetings with (20) target sponsors, to secure (3) charter sponsorships and (8) sub sponsors for (1) year of participation in the Maui Green Wave® Marketing Plan. Our sales staff will offer dynamic presentations of product, collateral and media contracts to portray our products accurately. PRICE A charter sponsorship package offers (1) year cross market promotion and sales through television, a live tour and internet, for $1,000,00. Price is based on the market value of total advertising time in television, internet promotion and sponsorship costs from previous live tours (Core Tour 2006). This promotion will reach an estimated (40 - 50) million viewers weekly via television, an additional (400,000) through (5) live events and (300,000) internet viewers in the first full year. PLACE Internet, live events and broadcasts television is where we deliver to our customers. Branding is the buy. Consumers become oriented with the brands, products and talent that are cross marketed through our aggressive marketing plan. Increased exposure = increased demand. CUSTOMER RETENTION Through continued positive growth, our clients (pertaining to sponsors) will increase their popularity through the power of association. As we grow, so will our ability to reach larger audience, sell greater amount of product and provide powerful marketing to our select client base. Increasing value, excellent account services and easy access to our integrated promotions will drive interest to our product from new and existing clientele. Marketing statistics derived from each year’s operations will provide quantifiable data to support our sponsor’s interest and continued participation in this powerful marketing vehicle.
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2009 Corporate Structure
Year 1 Business Milestones
Paul Cleveland Corporation
MAY 1, 2009 150K Funded
Begin operations d operator of Maui Green Wave® es, developer and agencyupon for funding. i Green Wave® MarketingEstablish office and staff.
MAY 15, 2009 150K Funded
Finalize business structure (Legal and accounting).
AUG 15, 2009 200K Funded
Complete all products and promotion. Launch Internet site.
SEPT 15, 2009 500K Funded
Initialize advertising campaign. Launch Ballistic TV and Ambush Tour.
DEC 15, 2009
Secure sponsors for 2010.
MAY 15, 2010 JAN 15, 2010
Launch of Ballistic TV Series 2010.
Launch of Ambush Tour 2010.
ui Green Wave®
Management Team
nd identity for products, ions and business operations
Key personnel in the operation of Paul Cleveland Corporation and their responsibilities, are:
PAUL CLEVELAND • CEO, President, Owner - oversees all aspects of business, strategy and creative of the PCC • BIO: Owner and operator yBTVTube.com Ambush Tourof retail sales and repair company for 15 years. Developed and invented the motorized all-terrain skateboard. Developed product line under Maui Cruzer®. 10 year professional director, producer and equipment operator in film and cinematography. Executive producer of this community “share-site” (5) city national event tour project. featuring Entrepreneur and inventor. g action sports, music, video, action sports, music, sales and promotion CARLO CARBAJAL • COO - responsible for operations of the PCC, Director of Advertising and Marketing for the PCC • BIO: Creative Director for (Robby) Naish International, Senior Art Director for Communication Pacific (Honolulu), principle creative for Carbajal Designs. Extensive experience in action sports marketing, award winning creative in television, print, radio and web. Clients include Red Bull, Robby Naish, Gerry Lopez, Maui Arts and Cultural Center, Queens Medical Center + others
commerce and marketing
Several key positions will be secured during Phase I of the operations plan. We have identified qualified candidates within the industry for each position and we will establish an experienced team to enable the PCC’s success. • T.B.D. - CFO - Director of Financial Operations for the PCC • T.B.D. – Media Sales Agents / Account Executives • T.B.D. – Tax and Accounting Management and Operations • Legal Services – T.B.D. will provide legal support and guidance to the owners about matters such as compliance with government regulations, exposure to liability, and contractual issues. • T.B.D. – General manager of Maui Cruzer® and the Ambush Tour • T.B.D. – General manager of Ballistic TV® and MyBTVTube.com
( Page 26 )
Paul Cleveland Corporation
Operations Plan This year’s operations will require strategic positioning in the market place. To implement our program we need to activate our business plan. In our initial phase, office and staff will be established with purpose to finalize all products, services and materials necessary to secure our corporate sponsorship goals. This will include completion of product samples, establishing vendor contracts, finalizing media purchase agreements and developing the sales delivery and promotional materials for use in sales calls. PHASE I
• First action will be to activate the core staff and facilities for operation of the PCC.
• Second action will include finalizing the business structure for the parent and sub companies with a strategic (legal and accounting) formation to propel the company(s) success.
• Third we will package each of our products including all marketing, sales structure and any terms necessary to launch each product into the market. We will complete all product design and will be ready to order hard and soft goods. It is here when MyBTVTube.com will launch online and amateur talent will gain a direct media link for exposure.
• Forth we will implement our advertising campaign and marketing strategy for 2009, including trade show promotion, retaining professional talent, print, television, web and live event promotion. This is when Ballistic TV® and the Ambush Tour will launch, reaching and estimated 40 - 50 million people per episode in a limited 3rd season (26 episodes).
• Fifth action will be to secure sponsors to fund the next full year of operation.
PHASE II
• First we will finalize the sponsors for this first full year of operations. Momentum from our previous year’s launch will offer expanded business opportunities for greater revenue.
• Second we will retain professional talent and implement our marketing strategy and advertising campaign for this year’s program
• Third action will be to secure sponsors to fund the next full year of operation.
PHASE III
• First we will finalize this year’s sponsors and expand upon promotional opportunities.
• Second we will retain professional talent and implement our advertising campaign and marketing strategy for the season.
• Third we will actively promote the sale or licence of Maui Green Wave® Marketing, Ballistic TV®, the Ambush Tour, Maui Cruzer®, and MyBTVTube.com products and assets.
( Page 27 )
Just because we make it look easy doesn’t mean anyone can do it.
( Page 28 )
Paul Cleveland Corporation
Financial Summary REVENUE, COST and PROFIT PROJECTIONS YEAR 1 TOTAL REVENUE TOTAL COSTS OF GOODS SOLD YEAR 1 TOTAL PROFIT ESTIMATE
= $ 6,567,760 = $ 3,034,000 = $ 3,533,760
YEAR 2 TOTAL REVENUE TOTAL COSTS OF GOODS SOLD YEAR 2 TOTAL PROFIT ESTIMATE
= $ 17,101,450 = $ 9,667,475 = $ 7,433,975
YEAR 3 TOTAL REVENUE TOTAL COSTS OF GOODS SOLD YEAR 3 TOTAL PROFIT ESTIMATE
= $ 23,042,250 = $ 11,553,875 = $ 11,488,375
TOTAL REVENUE FOR 3 YEARS = $55,661,460 TOTAL COST FOR 3 YEARS = $24,255,350 TOTAL NET PROFIT FOR 3 YEARS = $22,456,110 COMPANY SALE = $20 - 30 Million
( Page 30 )
( Based 1.5 X Annual Profits )
Branded products, accessories, soft goods and promotional items
USA Retailers
Action sports and music publishing, advertising and marketing
A community “share-site� featuring action sports, music, video, web commerce and marketing
( Page 31 )
National event tour featuring action sports, music, sales and promotion
Annual Financial Strategy 1) We have developed a promotional launch strategy for the first year to establish our product and use as collateral to secure corporate sponsors.
COST OF OPERATIONS - YEAR 1
YEAR 1
BALLISTIC TV® $ – (26) Episode National TV media buy $ – Sales & marketing budget $ – Film, editing, travel, equipment $ – Office, administration, accounting = $ Total cost of operations
REVENUE SUMMARY - YEAR 1
AMBUSH TOUR $ – (2) Associate Tours w/ Back Yard BBQ Tour $ – Sales & Marketing Budget $ – Merchandise $ – Office, administration, accounting = $ Total cost of operations
BALLISTIC TV ® $ + Advertising on (26) TV episodes $ + Promotions / product placement $ + Video and audio content resale = $ Total revenue
L A I T N E D
I F N CO
AMBUSH yTOUR MAUI CRUZER® ar is s$um+mMerchandise s s lo d $ – Product & merchandise design & samplesrofit an eview fo$r rTotal ear p s y r o 3 t = revenue s d e e $ – Sales & Marketing Budget A detail o qualified inv le t $ – Office, administration, accounting availab MAUI CRUZER® = $ Total cost of product and operations $ + Product & merchandise sales = $ Total revenue MyBTVTube.com $ $ $ =$
– Web Design, structure, servers, – Sales & Marketing Budget – Office, administration, accounting Total cost of product and operations
MyBTVTube.com $ + Web commerce = $ Total revenue
YEAR 1 TOTAL REVENUE $ 6,567,760
YEAR 1 TOTAL COSTS $ 3,034,000
YEAR 1 TOTAL PROFIT = $ 3,533,760
( Page 32)
2) We will identify new promotional opportunities each year to provide growth in revenue for each segment of the plan.
COST OF OPERATIONS - YEAR 2
YEAR 2
BALLISTIC TV® $ – (39) Episode National TV media buy $ – Sales & marketing budget $ – Film, editing, travel, equipment $ – Office, administration, accounting = $ Total cost of operations AMBUSH TOUR $ – (5) City national event tour $ – Sales & Marketing Budget $ – Merchandise $ – Office, administration, accounting = $ Total cost of operations
L A I T N E D
REVENUE SUMMARY - YEAR 2
I F N CO
BALLISTIC TV ® $ + Advertising on (39) TV episodes $ + Promotions / product placement $ + Video and audio content resale = $ Total revenue AMBUSH TOUR $ + Merchandise = $ Total revenue
MAUI CRUZER® $ – Product & merchandise design & samples $ – Sales & Marketing Budget $ – Office, administration, accounting = $ Total cost of product and operations
MAUI CRUZER® $ + Product & merchandise sales = $ Total revenue
MyBTVTube.com $ – Web Design, structure, servers, $ – Sales & Marketing Budget $ – Office, administration, accounting = $ Total cost of product and operations
MyBTVTube.com $ + Web commerce = $ Total revenue
YEAR 2 TOTAL REVENUE $17,101,450
YEAR 2 TOTAL COSTS $9,667,475
YEAR 2 TOTAL PROFIT = $ 7,433,975
( Page 33 )
Annual Financial Summary continued 3) We will expand upon new sales and promotional opportunities to generate even greater revenue in our 3rd year of operation.
COST OF OPERATIONS - YEAR 3
YEAR 3
BALLISTIC TV® $ – (39) Episode National TV media buy $ – Sales & marketing budget $ – Film, editing, travel, equipment $ – Office, administration, accounting = $ Total cost of operations
REVENUE SUMMARY - YEAR 3 BALLISTIC TV ® $ + Advertising on (39) TV episodes $ + Promotions / product placement $ + Video and audio content resale = $ Total revenue
AMBUSH TOUR $ – (5) City national event tour $ – Sales & Marketing Budget $ – Merchandise $ – Office, administration, accounting = $ Total cost of operations
L A I T N E D
I F N CO
AMBUSH TOUR $ + Merchandise = $ Total revenue
MAUI CRUZER® $ – Product & merchandise design & samples $ – Sales & Marketing Budget $ – Office, administration, accounting = $ Total cost of product and operations
MAUI CRUZER® $ + Product & merchandise sales = $ Total revenue MyBTVTube.com $ + Web commerce = $ Total revenue
MyBTVTube.com $ – Web Design, structure, servers, $ – Sales & Marketing Budget $ – Office, administration, accounting = $ Total cost of product and operations
YEAR 3 TOTAL REVENUE $23,042,250
YEAR 3 TOTAL COSTS $11,553,875
YEAR 3 TOTAL PROFIT = $11,488,375
( Page 34 )
Company Sale Value Our plan is concise. We see an opportunity to apply this financial strategy for a short duration and establish an attractive return on investment. We expect to grow rapidly with an intention to sell the company for sizable profit. PROJECTION OF GROWTH YEAR 1 PROFIT = $ 3,000,000 YEAR 2 PROFIT = $ 7,433,975 (247% Growth) YEAR 3 PROFIT = $ 11,488,375 (382% Growth)
COMPANY SALE VALUE PROJECTION ANNUAL REVENUE in 2012 = $ 23,042,250 SALE VALUE (1.5 x annual sales) = $ 34,000,000 +
The company sale value is moderately estimated at less than two times the total annual revenue for our third year of operation. This calculation was derived from several company acquisitions in action sports over the past five years: 1) The sales of DC Shoes to Quiksilver in 2004 DC total revenue in 2004 = $30 million / sold for $80 million / 2.5 x formula 2) The sale of Hurley to NIKE in 2005 Hurley total revenue in 2005 = $33 million / sold for $100 million / 2.5 x formula
( Page 35 )
It’s your turn to ride...
( Page 37)
Investment Opportunity We are seeking an investment of $1,000,000 to broadcast season 3 of Ballistic TV®, launch MyBTVTube.com and introduce the Ambush Tour to the public. This will establish a compelling model to illustrate our products and secure corporate sponsorship. This will enable us to implement the next full year of operations. INVESTMENT TERMS The Paul Cleveland Corporation has over 10 years of trade and operations. We have intriguing products and amassed premium action sports and music content to fuel years of programming and sales. In the integrated business format we have developed, we position ourselves as a start up company. We offer a high rate of return that is contingent on the performance of the company. We are seeking venture capital or angel investor funding to support our business objectives. INVESTMENT OPTION 1 • Initial investment of $1 million is repaid in full to investor over a 3 year period and earns 15% total rate of return ( $150k ). In addition, investor receives 3% of the company sale, targeted in 3 years for $20 - 30 million = over $600K + $150 K estimated return to investor based on this projection INVESTMENT OPTION 2 • Initial investment of $1 million is repaid in full to investor upon sale of company. In addition, investor receives 5% of the company sale, targeted in 3 years, for $20 - 30 million = over $1 million estimated return to investor based on this projection
INVESTMENT PAYMENT SCHEDULE • $1,000,000 Investment returned in full in 3 years • OPTION 1 Earns 15% total return over 3 years ( $150K ) + 3% Sale of Company ( $600K estimated return) • OPTION 2 Earns 5% Sale of Company ( $1- 1.5 million estimated return )
INVESTMENT FUNDING SCHEDULE $1,000,000 Investment will be funded incrementally over 5 months, • MAY 1st - $150K Funded • MAY 15th - $150K Funded • AUG 15th - $200K Funded • SEPT 15th - $500k Funded * more information on page 26 in Business Milestones
( Page 37)
Investment Capital
2009 Investment Structure
( $1,000,000 initial investment)
Target Investment of $1,000,000 will broadcast Season 3 of Ballistic TV®, launch MyBTVTube.com, introduce the Ambush Tour to the public and secure corporate sponsorship to fund the next full year of publishing and promotion.
PAUL CLEVELAND
INVESTOR / SHARE SUMMARY
CORPORATION
Paul Cleveland CEO, President, Founder ( 65% Shareholder) John Souza Angel Investor Investor, Developer ( 25% Shareholder) Carlo Carbajal COO, Developer ( 10% Shareholder)
Maui Cruzer® Branded products, accessories, soft goods and promotional items
Ballistic TV® Action sports and music publishing, advertising and marketing
Maui Green Wave®
MyBTVTube.com A community “share-site” featuring action sports, music, video, web commerce and marketing
( Page 39)
Ambush Tour (5) city national event tour featuring action sports, music, sales and promotion
We listen to the experts.
( Page 41)
Maui Cruzer dirtboards featured in MTV’s Living Lahaina • Poli Poli State Park, Kula, Maui 2008
A brief history of media exposure
( Page 57)
Print Media and Advertising
DVD Productions
UK GQ MAGAZINE / DEC 2003 8 pg spread shot on location
Print Media and Advertising
Photo Archives
Design + Packaging: Carbajal Designs Business Concept: Paul Cleveland Strategy: Paul Cleveland, Carlo Carbajal Copy: Paul Cleveland, Carlo Carbajal Photography: Paul Cleveland Corporation, Volcom Entertainment Artwork: Carbajal Illustrations, Paul Cleveland Corporation, Scott Jones