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IMSafer Angel Round
 

IMSafer Angel Round

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This is the slide eck that we used when we raised $1.2 million from investors for the angel round of IMSafer, back in 2006. The original company name was Collabarent.

This is the slide eck that we used when we raised $1.2 million from investors for the angel round of IMSafer, back in 2006. The original company name was Collabarent.

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Edit your comment
  • John Beletic – would be a good suggestion for the Series A board rep
  • BW - Not sure we need this slide, but it paints a picture
  • http://www.msnbc.msn.com/id/10912603/ for the stats
  • Need to change this slide – focus on bad people not bad content
  • BW - I don’t have a good title for this slide and the following slide, but what I want to convey is that there are two parts to the solution, and it makes for a unique sell to parents
  • Need to handle the issue of multiple IM names being created by

IMSafer Angel Round IMSafer Angel Round Presentation Transcript

  • Collaborating Parents. Safer Internet. Confidential Brandon Watson, CEO
  • The Team
    • Founder
      • Brandon Watson – CEO
        • RLX, Soros Private Equity, AskMe, Microsoft
        • Expertise in product design, sales and marketing, executive management
    • Board
      • [removed] – CEO/Founder, [removed] Networks
      • Brandon Watson
      • Series A representative
    • Advisors
      • [removed] – US Postal Inspector, Crimes Against Children
      • [removed] – PhD Candidate, MIT, Bioinformatics, ex-Microsoft Development Manager
    Confidential
  • Alarming Statistics
    • 1 in 5 youth ages 10 to 17 receive sexual solicitation or approach annually
    • 52% of teenagers use IM daily, 72% weekly
    • The FBI estimates that as many as 500K – 750K sexual predators are online on a daily basis, and there are over 18 million teenagers on line at any one time
    Confidential
    • Sources
    • Online Victimization, NCMEC, June 2000
    • Polly Klaas Foundation, December 21, 2005
    • FBI, 2006
  • The Problem
    • Parental control software primarily focuses on web browsing and web content
    • The Internet has removed barriers of access to children
    • Predators cultivate relationships with children over time
    • Only need screen name to initiate conversation
    • 89% of sexual solicitations of youths are on IM or chat
    • Social networking sites growth exacerbates these issues
    • There is little recourse for parents when they do discover an inappropriate on-line connection
    • No product exists to monitor multitude of IM networks
    Confidential
  • Dateline NBC - Net Predators Confidential jteno72960:want me to rub your feet katiedidsings:ya jteno72960:mmmmmmmmm now i’m getting turned on. m4pixeleen: do you talk about sex and things like that? m4pixeleen: you can tell me anything, it’s ok. greendaychickk: I have m4pixeleen: it is fun m4pixeleen:  you seem like a very sweet girl fleet_captain_jaime_wolfe: But, you are 13... sadlilgrrl: but if my own parents dont even love me, i dont really think anyone else will. fleet_captain_jaime_wolfe: Well, let me ask you this, if I were to offer you something, would you take it? fleet_captain_jaime_wolfe: I am looking for a younger submissive female to train...
  • Our Proposed Solution
    • Focus on protecting against bad people, not bad content
    • Make IM and chat ineffective as a tool for the potential child predator
      • Create online reputations for screen names
      • Give parents a conduit to let other parents know about potentially harmful IM users
    • Monitor all Instant Messenger networks
    • Based open source technologies and standards
    Confidential
  • Current Market Failings
    • Protecting children online has centered around pornography and hate sites
    • Ineffective monitoring solutions for online relationships
    • Logging software requires parental audits
      • Time consuming and ultimately ineffective
      • Prone to missing potential problems
    • Solutions not user friendly, often requiring child to install
    • Fencing in children causes them to seek ways around software
    Confidential
  • Competitive Analysis Confidential Web Filtering Web Logging Web Blocking IM Filtering IM Logging IM Reputation IM Content Alerts Cyber Patrol        Net Nanny        Spector Pro        eBlaster        Chat Watch        Norton        McAfee        Zone Alarm        Safe Eyes        IM Safer       
  • Target Market Confidential
    • Source
    • US Census, October 2004 data
  • Market Penetration Confidential Two independent studies show penetration is very low Source: Primary Company research
  • Market Research Confidential
    • Source
    • Primary company research, 162 responses
  • Market Research Confidential
    • Source
    • Primary company research, 64 responses
  • What’s It Worth To Parents? Confidential
    • Source
    • Primary company research, 452 responses
  • Market Analysis
    • ~40M US HHs @ $30/year = $1.2B market size
    • Thoroughly saturated market for web filtering software
    • Parental control software market very under-penetrated
    • Existing solutions viewed as ineffective or hard to use
    • Parents screaming for tech solutions
      • Willing to pay for solutions that work
    • Market leaders focused on web browsing, not IM and chat, which is the real source of pain for parents
    Confidential
  • IM Safer Solution Discussion Confidential
  • IM Safer – Application
    • Product to focus specifically on IM & chat protection
    • Real time packet analysis of all IM & chat conversations
    • Rules engine looking for patterns in text entries
      • Will work in conjunction with law enforcement and watchdog groups to create syntax rules
    • Rules database constantly updated with new grooming techniques and slang
    • Simple web based installation, reporting and administration for customers
    • Send alerts to customers via email or SMS
      • Immediacy based on priority of alert
    Confidential
  • IM Safer – Network Effects
    • Alerts are a shared resource and pooled from customers
    • Incentives for parents to tell friends – the more people in the network, the more useful it is for them
    • Customer voting determines threat level of screen names
    • Proactively alert when high level threats make contact
    • Cannot search for status/alerts of a screen name
      • Access to information only available for remote screen names that have made contact with a monitored account
    Confidential
  • IM Safer Technology Discussion Confidential
  • IM Safer – Client Architecture Confidential
  • IM Safer – Server Architecture Confidential
  • IM Safer – Application Confidential
  • IM Safer – Application Confidential
  • Collabarent Marketing & Business Confidential
  • Marketing Plan
    • Primary goal – identify and optimize method of customer acquisition
    • User acquisition
      • Google AdWords – ramp to $50K / month budget
      • Referral campaign – sign up friends and family, get free service
      • Spot Runner (?) as a potential source for cheap cable air time
    • Media blitz
      • Capitalize on current media buzz around on-line predators
      • Identify PR firm to get placement in national and local television, papers and magazines
      • Oprah – focus on problem she cares about, solved by African-American entrepreneur
    • School campaign
      • Give the software to every school that will take it
      • The bigger our network and database of alerts, the more valuable to parents to also be in the network
    Confidential
  • Marketing Plan
    • OEMs
      • Client side software delivered with new computers
      • Rev share on user signups
      • Possibility of creating skinned sites for OEMs to appear that they are providing the IM Safer service to their customers
      • All alerts are in shared DB for all customers
    • Religious Groups
      • Market to the groups as this is a big topic right now and the religious leaders carry sway with their constituencies
    • Community Building
      • Online safety forums
      • FAQs and best practices
    Confidential
  • Business Model (monthly subs) Confidential
  • Business Model (yearly sub) Confidential
  • Business Model (yearly, upside) Confidential
  • Challenges
    • Technical
      • Building and maintaining the syntax for the alert rules
      • Meeting code development milestones
      • Designing a scalable database
      • Designing simple user interface
    • Business
      • Hiring the right people quickly
      • Time to market
      • High profile media engagements
      • Generating word of mouth advertising
      • Initial user sign ups
      • Low cost customer acquisition campaign
      • Privacy concerns
    Confidential
  • Timeline
    • Formation (May – June)
      • Capital raising
      • Hiring – 4 additional dev heads (already have 1 position filled)
    • Software development (June – September)
      • Spec completion for web application and client code
      • Designing scalable database
      • Code development to release to beta
      • Build alert rules hierarchy
    • Beta testing (September – October)
      • Initial user sign ups – have over 250 emails of interested parents
      • Fine tuning application design and architecture
      • Bug fixing
      • Data center deployment
      • Begin media push
    • Product launch (November)
      • Market awareness
      • V2 planning
    Confidential
  • Competitive Advantages
    • Small and focused team, passionate about the problem
    • Will seek relevant patents
      • Using network voting system to track online reputations in instant messenger context
      • Real time syntax analysis of IM and chat conversations with associated alerting
    • Alert rules and alert database become defensible competitive advantage
      • Huge barrier to entry for new entrants
      • Barrier to entry to online players because database spans IM networks
    • IM is not going away as a communication medium, and in fact problem will just get bigger
    • There is no way to game our reputation system
      • We control and can verify an information transaction took place
    Confidential
  • Why Invest?
    • Management team with startup experience
    • Team passionate about protecting children on-line
    • Topical problem space with little product innovation or thought leadership
    • Problem thoroughly examined; solution well thought out
    • Strong revenue potential with low operating expense overhead, resulting in strong economies of scale
    • Solution can be extended to email and web as well
    • Be a part of a positive social cause
    • Stop bad people from using the Internet for evil
    Confidential
  • Investment Risks
    • The technology is not difficult, we just have a very different way of solving the problem
    • Creating a reasonable and effective rules database could prove challenging
    • User acquisition costs are currently difficult to predict
    • Any of the on-line majors or parental control software providers could decide this is functionality they want to build
    • Customer apathy
    Confidential
  • Future Directions
    • Web access
      • Using the same paradigm of parents casting votes for sites
      • Based on particular customer’s preference, filter by grouped score of site
    • Email monitoring
      • Same concept as the IM product
      • Know who the children are speaking to and about what
    Confidential
  • Exit Strategy
    • Cash flow
      • Based on projections, CFLO positive occurs at 4000 yearly customer subscription collections per month
    • Acquisition
      • Major online players – short term
        • MSN, Yahoo!, AOL, Google
      • Anti-virus / security software companies – med term
        • Symantec, McAfee
    • Grow and take public – long term
      • Partner with major online players to grow user base
    Confidential