1Providing innovative solutions to support theentire real estate experience – on the largest socialmedia platform in the world.Leading Real Estate Platform on Social MediaLaunched October 2011
2Vision The business is being built on the vision that the Facebook platform and ecosystemwill become the overwhelming choice for real estate professionals to market andpromote their services and properties.Platform Reach More than 1 billion Facebook users worldwide – capturing 3/4 of consumer time spenton social destinations. 150 million unique monthly Facebook users within the United States. 1.8 million licensed real estate professionals in the United States – 85% of all USreal estate agents are currently using Facebook. N-Play can target all of these agentson the Facebook platform today.
3Online Advertising Trend 90% of home buyers used the Internet to research homes. Online real estate ad spend to grow to $13.1 billion in 2012, or 55% of overall realestate spend, as budgets shift away from traditional offline sources.051015202530354045502001 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011PercentageWhere buyers found the home they purchased.Courtesy of: BusinessweekVia AgentVia Online42%33%
4 Homebuyers are unableto reach the agentwebsite. Agent websites haveextremely low sitetraffic.Current State: For the agent…the “web” is dead.AgentWebsiteHomebuyer
5Future State: For the agent…direct via Facebook. Social media is dynamic, connected, engaging, viral, ALIVE and everywhere.AgentFacebookBusinessProfile Homebuyers areable to find theagent directly onFacebook. Agent’s Facebookbusiness profile isfree.Homebuyer
6N-Play has gone viral…Key Stats 183,000 Active Agent Subscribers 23,000 Agents with Listings 6,500+ Cities Represented 130,000 Active Property ListingsAgent Subscribers0100,000200,000300,000400,000500,000600,000
8N-Play FounderMark Bloomfield is a seasoned entrepreneur having started, built and successfully soldseveral pioneering technology companies over a twenty-five year career.Georgia Institute of Technology – Industrial and Systems Engineering (1975-1980)Parrot Communications – Founder and CEO (1982-1985) Developed and manufactured first transportable cellular phone Sold to General Electric Mobile Radio Division (1985)AudioFax – Founder and CEO (1986-1996) Developed pioneering patented technologies covering a wide range of fax store-and-forward technologies Hundreds of millions of users worldwide are using these technologies Sold to Catch Curve, Inc. (1996)AudioFax Licensing LLC – Founder and CEO (1996-2006) Licensed a portfolio of pioneering technology patents to companies Licensees: AT&T, MCI, Sprint, Cable and Wireless, Cisco, 3Com, J2 and Xpedite Patent portfolio sold to J2 (2006)N-Play RE, LLC – Founder and CEO (2007-Present)
9Market Comps Zillow and Trulia are real estate website businesses with similar functionality to N-Play.Zillow, Inc. Valuation StatisticsNasdaq: Z Info as of: 4/25/13Market Capitalization $1.9 billionEnterprise Value $1.7 billionRevenues (TTM) $117 millionGross Margin (TTM) $103 millionEBITDA (TTM) $12 millionRevenue Generation: EBITDA % 10.6%1. Subscription fees from agents who wish to generate leads2. Commissions through brokering prospective clients with lending institutions3. Sells display ads on its home page and in the side bar of home listingsTrulia, Inc. Valuation StatisticsNYSE: TRLA Info as of: 4/25/13Market Capitalization $974 millionEnterprise Value $911 millionRevenues (TTM) $68 millionGross Margin (TTM) $58 millionEBITDA (TTM) $(7) millionRevenue Generation: EBITDA % -10.3%1. Primarily from sales of subscription products to real estate professionals2. Display advertising sold to leading real estate and consumer brand advertisersBusiness Description: Provides consumers tools to research homes andneighborhoods. Allows agents to market their listings and attract new clients.Focused on empowering the consumer by delivering the "inside scoop" on homes,neighborhoods and real estate agents.Business Description: Provides consumers with data and information abouthomes around the country. The information allows consumers to quickly glean thespecs of a home and a ballpark market price and also to contact a real estate agent ifthe consumer wants to explore the lead in more detail.
10Market Comps Zillow and Trulia have been publicly-traded companies for less than two years andboth have multi-million dollar market capitalizations. Based on a similar valuation methodology, management projects that N-Play will bevalued at $257 million by 2014.Zillow Trulia N-Play N-PlayInfo as of: 4/25/13 (Nasdaq:Z) (NYSE:TRLA) 12/31/2014Market Capitalization $1.9 billion $974 million $25 million $257 millionMonths in Existence 90 75 18 38Valuation DriversAgent Subscribers 37,718 31,243 6,081 23,191Avg. Monthly Rev/Subscriber $ 260 $ 194 $ 16 $ 61Subscriber Acquisition Cost $ 5,120 $ 6,374 $ 4 $ 3Monthly Subscriber Revenue Mult. 203.9x 160.4x 182.2x
11Business Model ContrastZillow & Trulia N-Play RationaleCore Revenue Model Third party advertising Agent support tools Business model is "pure play" for realestateMLS Listing Content Incomplete dataset Internet Data Exchange from MLS N-Play content is a complete dataset -Zillow & Trulia are incomplete and datacan be manipulatedInteraction Limited interaction Extremely interactive N-Play is the ideal interactive tool foragents to connect with potentialhomebuyers and sellersAgent Acquisition Cost In excess of $3,500 per subscriber Less than $5 per subscriber Acquisition cost clearly supports thevalue proposition to real estate agentsSocial Media Connectivity None High Real estate is the highest sociallyconnected industry
12Financial Projections Using conservative estimates, N-Play is projected to have positive Net Income by firstquarter 2014.2013 2014 2015 2016 2017Total Revenue 2,092,975$ 16,927,013$ 30,912,553$ 47,699,101$ 67,366,657$Cost of Goods Sold 1,130,794 8,840,521 16,022,765 24,604,294 34,618,908Gross Profit 962,180 8,086,492 14,889,788 23,094,807 32,747,748Gross Margin 46.0% 47.8% 48.2% 48.4% 48.6%Total Expenses 3,066,163 3,731,486 2,953,187 2,953,187 2,953,187EBITDA (2,103,983) 4,355,006 11,936,601 20,141,619 29,794,561Net Margin -100.5% 25.7% 38.6% 42.2% 44.2%Key AssumptionsREAD Members 313,000 553,000 803,000 1,053,000 1,303,000Avg. Daily Ad User Additions 10 20 25 30 35Cumulative Ad Users 3,743 11,043 20,168 31,118 43,893% of Directory 1.2% 2.0% 2.5% 3.0% 3.4%Avg. Daily IDX Additions 10 20 25 30 35Cumulative IDX Users 4,848 12,148 21,273 32,223 44,998% of Directory 1.5% 2.2% 2.6% 3.1% 3.5%
13Investment Uses 90% of funds will go to hiring more Development and Marketing staff and formarketing and advertising costs associated with marketing pay services.Capital UseSoftware Development $1.1 Million Projected cost to finish totaldevelopment of N-Play platformMarketing and $900 Thousand $900 thousand budget will fund agentAdvertising membership growth to a total of 500,000by Oct 2014Customer Service $300 Thousand Increase customer service to supportgrowing membership baseExcess Working Capital $2.7 MillionTotal $5.0 Million
14Term SheetN-PLAY OfferingIssuer:Security:Amount of Issue:Valuation andCapitalization:N-Play RE, LLC, a Delaware limited liability company (the“Company”).Class C Membership Units of the Company (the “Class CUnits”). The Class C Units will rank senior to all other equitysecurities of the Company.The aggregate amount of the offering of the Class C Units isanticipated to be $5.0 Million.This investment assumes a Company pre-money equityvaluation of $25.0 Million. Immediately after the closing, theClass C Units will represent approximately 16.67% of theCompany’s equity on a fully-diluted basis including its issuedwarrants (i.e., assuming all currently-issued warrants areexercised in full).