Symptum Cycles <ul><li>Mitchell Angus & Vladimir Borisov  </li></ul><ul><li>December 11 th , 2008 </li></ul>
Overview <ul><li>Brief Introduction </li></ul><ul><li>Team </li></ul><ul><li>Prototype </li></ul><ul><li>Environmental Ana...
Brief <ul><li>Continuously Variable Transmission or CVT:  </li></ul><ul><ul><li>Is a transmission in which the ratio of th...
Team <ul><li>President Mitch Angus: Avid sponsored competitive gravity mountain biker </li></ul><ul><ul><li>Competing sinc...
Consultants <ul><li>Dana Engineering Machine Shop </li></ul><ul><ul><li>Confidential </li></ul></ul><ul><ul><li>Instructor...
Unique opportunity <ul><li>Current limitations </li></ul><ul><ul><li>Conventional bicycles have pre-selected gear ratios <...
Selected Prototype <ul><li>Rational </li></ul><ul><ul><li>Low production costs </li></ul></ul><ul><ul><li>Commonly used de...
The Next Step <ul><li>Prototype Testing </li></ul><ul><ul><li>Slip conditions </li></ul></ul><ul><ul><li>Force profile </l...
Market <ul><li>Portland regularly ranks at the top of Bicycling Magazine’s list of the best cycling cities. </li></ul><ul>...
Competition <ul><li>The bicycle industry is divided into 4 different distribution channels.  </li></ul><ul><ul><li>I. Spec...
Income <ul><li>Revenue:  </li></ul><ul><ul><li>Online </li></ul></ul><ul><ul><li>Bicycle Retailer </li></ul></ul><ul><ul><...
Risk Assessment <ul><li>Design might not meet expectations </li></ul><ul><ul><li>Final prototype will be tested by competi...
Operations
Projected Prototype Funding <ul><li>TASK 1  (in progress) </li></ul><ul><li>Facilities $500 </li></ul><ul><li>Salaries $70...
Projected Prototype Funding Cont. <ul><li>TASK 3 </li></ul><ul><li>Facilities $500 </li></ul><ul><li>Salaries $6500 </li><...
Financing <ul><li>Required Capital  </li></ul><ul><li>Year 1 </li></ul><ul><ul><li>October- $35,000 </li></ul></ul><ul><ul...
Benchmarks and Goals  <ul><li>Year 1 </li></ul><ul><ul><li>First 3 months </li></ul></ul><ul><ul><ul><li>Design gearbox an...
Projections Net Profit Margin: 33% Year 1 Year 2 Year 3 Year 4  Year 5 Net Income $34,017 $837,573 $816,486 $1,098,365 $1,...
Breakeven
Exit Strategy <ul><li>Buy out investor at 7 times their original investment </li></ul><ul><ul><li>Investor: $1,400,000 – y...
Questions
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Symptum Final Presentation

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No representation or warranty is made as to the accuracy, reliability or completeness of any of the information contained herein. Nothing contained in this document is, or should be relied upon as, a promise or representation of future events or conditions. Recipients of this document agree that all information contained herein is of a confidential nature, that they will treat it in such confidential manner and that they will not, directly or indirectly, disclose or permit their agents or affiliates to disclose any of such information without the prior written consent of this company. Neither this document nor its delivery to any prospective investor shall constitute an offer to sell, or a solicitation of an offer to buy, any securities of this Corporation. Nor shall the receipt of this document be construed to indicate that there has not been any change in the affairs of the company.

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Transcript of "Symptum Final Presentation"

  1. 1. Symptum Cycles <ul><li>Mitchell Angus & Vladimir Borisov </li></ul><ul><li>December 11 th , 2008 </li></ul>
  2. 2. Overview <ul><li>Brief Introduction </li></ul><ul><li>Team </li></ul><ul><li>Prototype </li></ul><ul><li>Environmental Analysis </li></ul><ul><li>Operations </li></ul><ul><li>Financing </li></ul><ul><li>Exit Strategy </li></ul>
  3. 3. Brief <ul><li>Continuously Variable Transmission or CVT: </li></ul><ul><ul><li>Is a transmission in which the ratio of the rotational speeds of two shafts, as the input shaft and output shaft, can be varied continuously within a given range, providing an infinite number of possible ratios. </li></ul></ul><ul><ul><li>Engine performs at a maximum efficiency </li></ul></ul><ul><ul><ul><li>Potential to create a biomechanically favorable bicycle </li></ul></ul></ul><ul><ul><li>Smooth shifting </li></ul></ul>
  4. 4. Team <ul><li>President Mitch Angus: Avid sponsored competitive gravity mountain biker </li></ul><ul><ul><li>Competing since ‘96: Professional Status 2001-2005 & 2008 </li></ul></ul><ul><ul><li>The National Off-Road Bike Association, Oregon Bike Racing Association, Canadian Cup, Washington, Idaho, Montana Mountain Bike Series </li></ul></ul><ul><li>CTO: Vladimir Borisov: Bioengineering major with a background in mechanical engineering. </li></ul><ul><ul><li>Summer internship under supervision of Dr. Davis </li></ul></ul><ul><ul><li>Previous Small Business Owner </li></ul></ul>
  5. 5. Consultants <ul><li>Dana Engineering Machine Shop </li></ul><ul><ul><li>Confidential </li></ul></ul><ul><ul><li>Instructor </li></ul></ul><ul><ul><li>Confidential   </li></ul></ul><ul><li>Ride This Bike Shop </li></ul><ul><ul><li>Owner </li></ul></ul><ul><ul><li>Confidential </li></ul></ul><ul><li>EVS </li></ul><ul><ul><li>Marketing Manager </li></ul></ul><ul><ul><li>Confidential </li></ul></ul><ul><li>Downhill Northwest Bicycle Shop and Training Camp </li></ul><ul><ul><li>Owner </li></ul></ul><ul><ul><li>Confidential </li></ul></ul><ul><li>Serial Entrepreneur/Venture Capitalist/Niitek </li></ul><ul><ul><li>Chief Technical Officer </li></ul></ul><ul><ul><li>Confidential   </li></ul></ul><ul><li>Tesoro </li></ul><ul><ul><li>Chief Chemical Engineer </li></ul></ul><ul><ul><li>Confidential </li></ul></ul><ul><li>Invicta Law Group </li></ul><ul><ul><li>Attorney at Law </li></ul></ul><ul><ul><li>Confidential </li></ul></ul><ul><li>  AterWaynne </li></ul><ul><ul><li>Partner </li></ul></ul><ul><ul><li>Confidential   </li></ul></ul><ul><li>Waddell & Reed </li></ul><ul><ul><li>Financial Advisor </li></ul></ul><ul><ul><li>Confidential </li></ul></ul>
  6. 6. Unique opportunity <ul><li>Current limitations </li></ul><ul><ul><li>Conventional bicycles have pre-selected gear ratios </li></ul></ul><ul><ul><li>The rider is prevented from performing at optimal efficiency </li></ul></ul><ul><li>Opportunity </li></ul><ul><ul><li>Rider is given the unique ability to control input to output “gear” ratio over a continuously variable range </li></ul></ul><ul><ul><li>Potential to optimize muscle efficiency </li></ul></ul><ul><ul><li>The proposed alternative CVT transmission will allow us to capture a fraction of a multi billion dollar bicycle market in the US alone </li></ul></ul>
  7. 7. Selected Prototype <ul><li>Rational </li></ul><ul><ul><li>Low production costs </li></ul></ul><ul><ul><li>Commonly used design </li></ul></ul><ul><ul><li>Mechanical simplicity </li></ul></ul><ul><ul><li>Previous work cited </li></ul></ul>
  8. 8. The Next Step <ul><li>Prototype Testing </li></ul><ul><ul><li>Slip conditions </li></ul></ul><ul><ul><li>Force profile </li></ul></ul><ul><li>Actuator design </li></ul><ul><ul><li>Actuator selection </li></ul></ul><ul><ul><ul><li>Pneumatic </li></ul></ul></ul><ul><ul><ul><li>Electric </li></ul></ul></ul><ul><ul><ul><li>Mechanical </li></ul></ul></ul><ul><ul><li>Geometrical design </li></ul></ul><ul><ul><ul><li>Frame compatibility </li></ul></ul></ul>Pedal attachment Variable Sheave sheave Output sprocket Gear (a) shifter bar motion Gearbox first prototype design Testing set up Friction rollers Force sensor
  9. 9. Market <ul><li>Portland regularly ranks at the top of Bicycling Magazine’s list of the best cycling cities. </li></ul><ul><li>Portland’s bicycle-related industry was worth $60 million in 2007. </li></ul><ul><li>Nation’s highest % of workers who commute by bike, about 3.5%. </li></ul><ul><li>The market is increasing yet stable and will continue to thrive with popularity in the sport starting to increase. </li></ul><ul><li>6 Billion Dollar Industry in the US. </li></ul><ul><li>Bike Industry is growing at a rate of 6.4%. </li></ul><ul><li>Headquarters will be located in Portland, Oregon. </li></ul>
  10. 10. Competition <ul><li>The bicycle industry is divided into 4 different distribution channels. </li></ul><ul><ul><li>I. Specialty 49% II. Full Line 8% </li></ul></ul><ul><ul><li>III. Other 6% IV. Mass Merchants 37% </li></ul></ul><ul><li>Niche </li></ul><ul><ul><li>Having a standardized internal drive system will set us apart from the competition. </li></ul></ul>
  11. 11. Income <ul><li>Revenue: </li></ul><ul><ul><li>Online </li></ul></ul><ul><ul><li>Bicycle Retailer </li></ul></ul><ul><ul><ul><li>Purchase bikes at a discount or wholesale </li></ul></ul></ul><ul><li>The revenue comes directly from the profits made from selling complete bicycles online or to distributors for a wholesale pricing. </li></ul>
  12. 12. Risk Assessment <ul><li>Design might not meet expectations </li></ul><ul><ul><li>Final prototype will be tested by competitive bikers and bicycle enthusiasts </li></ul></ul><ul><ul><ul><li>Initial scores will be a comparison to their bicycle of choice </li></ul></ul></ul><ul><li>Market Acceptance of the internal gearbox </li></ul><ul><ul><li>Bike shows, shopping mall, and public event displays </li></ul></ul><ul><ul><ul><li>Attempt to gather consumer response through surveys </li></ul></ul></ul><ul><ul><ul><ul><li>Provide market acceptability and consumer reaction </li></ul></ul></ul></ul>
  13. 13. Operations
  14. 14. Projected Prototype Funding <ul><li>TASK 1 (in progress) </li></ul><ul><li>Facilities $500 </li></ul><ul><li>Salaries $7000 </li></ul><ul><li>Consulting $250 </li></ul><ul><li>Direct Costs </li></ul><ul><li>Parts $250 </li></ul><ul><li>Labor $500 </li></ul><ul><li>TOTAL $8,500 </li></ul><ul><li>TASK 2 </li></ul><ul><li>Facilities $500 </li></ul><ul><li>Salaries $6000 </li></ul><ul><li>Consulting $500 </li></ul><ul><li>Direct Costs </li></ul><ul><li>Parts $2000 </li></ul><ul><li>Labor $2000 </li></ul><ul><li>TOTAL $11,000 </li></ul>
  15. 15. Projected Prototype Funding Cont. <ul><li>TASK 3 </li></ul><ul><li>Facilities $500 </li></ul><ul><li>Salaries $6500 </li></ul><ul><li>Consulting $1000 </li></ul><ul><li>Direct Costs </li></ul><ul><li>Parts $4000 </li></ul><ul><li>Labor $6000 </li></ul><ul><li>TOTAL $18,000 </li></ul><ul><li>TASK 4 </li></ul><ul><li>Facilities $1000 </li></ul><ul><li>Salaries $7000 </li></ul><ul><li>Consulting $1000 </li></ul><ul><li>Direct Costs </li></ul><ul><li>Parts $1000 </li></ul><ul><li>Labor $1000 </li></ul><ul><li>Testing $3000 </li></ul><ul><li>TOTAL $14,000 </li></ul>
  16. 16. Financing <ul><li>Required Capital </li></ul><ul><li>Year 1 </li></ul><ul><ul><li>October- $35,000 </li></ul></ul><ul><ul><li>Founders, Friends, Family </li></ul></ul><ul><ul><li>Infusions </li></ul></ul><ul><ul><ul><li>April - September </li></ul></ul></ul><ul><ul><ul><li>Total $200,000 </li></ul></ul></ul><ul><li>Willing to give up 29% of equity </li></ul>
  17. 17. Benchmarks and Goals <ul><li>Year 1 </li></ul><ul><ul><li>First 3 months </li></ul></ul><ul><ul><ul><li>Design gearbox and frames </li></ul></ul></ul><ul><ul><ul><li>Acquire patents </li></ul></ul></ul><ul><ul><li>Second 3 months </li></ul></ul><ul><ul><ul><li>Market testing </li></ul></ul></ul><ul><ul><li>Second 6 months </li></ul></ul><ul><ul><ul><li>begin acquiring distributors </li></ul></ul></ul><ul><li>Year 2 </li></ul><ul><ul><li>Official introduction in to market </li></ul></ul><ul><ul><li>1,500 bikes sold, $900,000 sales </li></ul></ul><ul><li>Year 5 </li></ul><ul><ul><li>$3,000,000 in sales </li></ul></ul><ul><ul><li>International Sales & 1% of market </li></ul></ul><ul><ul><li>Buy out investors </li></ul></ul>
  18. 18. Projections Net Profit Margin: 33% Year 1 Year 2 Year 3 Year 4 Year 5 Net Income $34,017 $837,573 $816,486 $1,098,365 $1,329,750 Revenue $857,709 $2,152,894 $2,583,813 $3,358,957 $4,030,749 Cash ($106,548) $706,871 $1,123,731 $2,093,223 $3,323,713
  19. 19. Breakeven
  20. 20. Exit Strategy <ul><li>Buy out investor at 7 times their original investment </li></ul><ul><ul><li>Investor: $1,400,000 – year 5 </li></ul></ul><ul><li>Year 10 or $50 million: </li></ul><ul><ul><li>Reevaluate </li></ul></ul><ul><ul><ul><li>Single founder sell </li></ul></ul></ul><ul><ul><ul><ul><li>Shares will be purchased from remaining founders </li></ul></ul></ul></ul><ul><ul><ul><li>Continue operation </li></ul></ul></ul><ul><ul><ul><li>Acquisition </li></ul></ul></ul><ul><ul><ul><li>All founders step down </li></ul></ul></ul><ul><ul><ul><ul><li>Retain shares; board members </li></ul></ul></ul></ul>
  21. 21. Questions

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