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Gene Massey of Media Shares explains the direct IPO process his company wants to create to enable a new kind of crowdsourcing.

Gene Massey of Media Shares explains the direct IPO process his company wants to create to enable a new kind of crowdsourcing.

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  • MediaShares new method for Initial Public Offerings through Crowdfunding could change Wall Street, as it offers a way for companies to get the funding they need from their own fans, customers, or affinity groups, and in so doing they would build a massive online community of owners.
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  • 1. U.S. Patented, SEC-Compliant Funding Through Crowdfunding
  • 2. MediaShares
    • Companies Need Capital to Start or Grow
    • Problem: Current Funding Environment
    • All Funding is hard to find now
    • Banks loans are extremely difficult to obtain
    • Many VC’s Not Funding
    • Angels are very conservative (or Broke) now
  • 3. MediaShares
    • New Funding Source: Crowdfunding
    • Current Examples:
    • Sellaband.com , record albums
    • Kickstarter.com , creative projects
    • IndieGoGo.com , movies
    • RacingShares.co.uk , Racehorses
    • JustinWilsonplc.com, Formula One Team
    • MyFootballClub.co.uk , Sports team
    • Barack Obama , Presidential Campaign ($600 million?)
    • AgeofStupid.net , TV Show (Not! – raised over 800,000 pounds)
    • Trampoline Systems, U.K. Technology firm! (instead of VC)
  • 4. Crowdfunding Works!
    • Trampoline Systems: London-based social analytics system raised 500,000
    • pounds (instead of VC funding)
    • Barack Obama , Presidential Campaign ($600 million ?)
    • AgeofStupid.net : TV Show (Not Stupid! – raised over
    • 800,000 pounds )
    Crowdfunding Successes:
  • 5. Crowdfunding Works!
  • 6. Crowdfunding Works!
  • 7. MediaShares
    • Current Crowdfunding examples:
    • Majority are outside the U.S. (different Regulations)
    • U.S. Crowdfunding is mostly through Donations
    • “ Investments” highly regulated by SEC
  • 8. MediaShares A New Method Of Public Financing
    • MediaShares - A Financial Services Company Offering:
    • An SEC-compliant Method of Crowdfunding
    • Two Types of Online Offerings:
    • NASDAQ Capital Market IPO
    • Registered Direct Offerings (Similar to a PIPE)
    • Companies sell stock Directly to the Public on their own Web sites
  • 9. MediaShares A New Method Of Public Financing
    • MediaShares.com Business Method:
    • Method for selling as little as One Share of NASDAQ Stock online
    • Shareholders get company’s product as a dividend (free DVD?)
    • Shareholders receive their share of a Company’s net earnings paid out as cash dividends
    • MediaShares has an issued U.S. Patent ( 6,792,411 )
  • 10. MediaShares
    • The New MediaShares IPO:
    • Fully SEC-Compliant with all Regulations (Fed. & State)
    • Either NASDAQ Capital Market or OTCBB
    • Underwriter is optional
    • IPO Posted on the Company’s Web site
    • Stock sold to Company’s Affinity Group: Fans, Customers, or through Social Marketing
    • Shareholders join a massive online community
  • 11. MediaShares
    • MediaShares Registered Direct Offerings:
    • S-3 Filing (public company for 2 years)
    • Similar to a PIPE investment, but sold to General Public
    • Stock sold on the Company’s Own Web site to Fans or Customers
    • Stock is immediately tradable and liquid
    • Used Very Successfully for Loyalty programs
    • Shareholders join a massive online community
    • Example:
    • Buy Home Depot Stock on Home Depot’s Web site
  • 12. MediaShares
    • MediaShares stock is sold through Direct Registration :
    • Stock sale completed online
    • Book entry
    • No paper certificates
    • Electronic disclosure documents
    • All communication through email
    • Millions of shareholders managed in a server
  • 13. MediaShares Competition
    • Other companies selling their shares online:
    *Can’t sell to the general public *Accredited investors only
  • 14. MediaShares
    • MediaShares Partners :
    • BNY Mellon – Direct Registration Supplier
    • ComputerShare – Direct Registration Supplier
    • Ellen Phillip & Associates – Data Management
    • David Wagner & Associates – Securities Attorney
  • 15. MediaShares A New Method Of Public Financing
    • Can fund ANY BUSINESS with a large group of customers or fans online
    • Works great for funding entertainment companies
    • Tremendous possibilities for building a hyperactive Internet community
    • MediaShares Licenses its U.S. Patented Business Method:
    • Movies
    • NASCAR Teams
    • Major Sports Teams
    • Video Games
    • Broadway Shows
    • Record Albums
    • Celebrities with Pet Projects
    • Thoroughbred Racehorses
    • Any Company with many Fans or Customers
  • 16. MediaShares.com Revenues From Licensee Companies
  • 17. CinemaShares.com First Licensee Companies
  • 18. CinemaShares.com Licensee Companies Owned by Parent
    • “ David Livingstone - The Truth Behind The Legend”
    • - A film about the greatest Christian Missionary that ever lived
    • CinemaShares.com owns all rights to this award-winning book and will finance this Christian-themed Film
  • 19. The Gene Woods / Circle K NASCAR Racing Team
  • 20. CinemaShares.com Online Partners
  • 21. RacingShares.com Examples of First Licensee Companies
    • “ Gene Woods Racing”
    • A RacingShares.com Licensee Company
    • Qualified as a NASCAR “Busch Series” Team
    • Gene Woods has numerous past wins
    • Letter of Intent from Jennifer Jo Cobb - NASCAR Busch Series
    • Online Contest for 3rd Driver
    • Affiliated with Circle K Stores
  • 22. RacingShares.com Business Method
    • Finance NASCAR Racing Teams
      • Tremendous fan base for Formula One & NASCAR racing
      • Fans collected from Internet Web sites and product promotional tie-ins
    • Fans buy one share of stock in their favorite team
    • Shareholders (racing fans) receive many additional benefits:
      • Streaming video access to pits
      • Contests for pits tickets and a day with the driver, etc
      • A free DVD of the season highlights as a stock dividend
    • Stock also sold to Advertisers and Corporate Sponsors
    • Shareholders receive their portion of the team’s winnings paid out as cash dividends
  • 23. RacingShares.com Online Marketing
  • 24. The MediaShares Team
    • Gene Massey: Founder, Chairman, & CEO
      • SEO Marketing & Securities Specialist
      • CEO of Los Angeles film production company
    • Jim Volpe, Chief Operating Officer
      • Invented the Direct Registration System
      • Expertise in DRS, book entry and stock transfers
    • Peter Elwell, Chief Financial Officer
      • Former CFO of Primedia Division
      • Worked for Disney & KPMG
      • Extensive experience with SEC Reporting Requirements
    • Ileana Rizescu, Chief Technology Officer
      • Former PWC Consultant
      • Designed E-commerce systems for Pepperdine
    • Dan Sherkow: Board Member
      • Former Vice President of Paramount Pictures
      • FINRA Series 7 and funding expert
  • 25. MediaShares Earnings From Licensee Companies
    • MediaShares earns CASH FEES and CASH DIVIDENDS from each Licensee Company. These earnings include:
    • $500,000 CASH FEE for License from each new company
    • Service fees as exclusive supplier of Internet services (hosting, bandwidth, etc.)
    • Cash earnings as exclusive supplier of online merchandise
    • MediaShares owns stock in each Licensee Company:
      • Owns 7% of the stock in a Licensee Company and
      • receives 7% of all earnings paid out as CASH DIVIDENDS
      • Owns 50% of the stock in a Licensee Companies and
      • receives 50% of all earnings paid out as CASH DIVIDENDS
  • 26. MediaShares Earnings From One Licensee Company
    • Earnings from 1st MediaShares IPO, The Livingstone Film Company:
    • MediaShares owns 50% of the stock in Livingstone and receives 50% of all earnings paid out as CASH DIVIDENDS:
  • 27. MediaShares Earnings From One Licensee Company
    • Earnings example, 50% Ownership, MediaShares Licensee Company IPO,
    • The Livingstone Film Company :
    • MediaShares owns 50% of the stock in Livingstone and receives 50% of all earnings paid out as CASH DIVIDENDS.
    • Livingstone Company Projected Earnings (not including merchandise sales):
    • Conservative…….. $ 1,229,464.
    • Moderate…………. $ 59,192,463.
    • Aggressive………. $110,146,128.
    • Using the Moderate Scenario above, MediaShares earnings @ 50%:
    • $29,596,231.
  • 28. MediaShares Earnings From One Licensee Company
    • Earnings example, 7% Ownership, MediaShares Licensee Company IPO,
    • The Livingstone Film Company :
    • MediaShares owns 7% of the stock in Livingstone and receives 7% of all earnings paid out as CASH DIVIDENDS.
    • Livingstone Company Projected Earnings (not including merchandise sales):
    • Conservative…….. $ 1,229,464.
    • Moderate…………. $ 59,192,463.
    • Aggressive………. $110,146,128.
    • Using the Moderate Scenario above, MediaShares earnings @ 7%:
    • $ 4,143,472.
  • 29. RacingShares.com Typical Online Sales Example
    • NASCAR Merchandise Online Sales
    • Typical Earnings FROM EACH NASCAR Team
    • Earnings below are based on 50% of MSRP:
    • 2,000 Hats per month @ 9 ea = $ 18,000 per month
    • 10,000 T-shirts per month @ 12 ea= $120,000 per month
    • 5,000 Model cars @ 4 ea= $ 20,000 per month
    • 5,000 Other items @ 5 ea= $ 25,000 per month
    • ________________
    • Typical Online Sales per 30 days = $183 ,000 per month
  • 30. MediaShares Solid Earnings Potential
    • MediaShares.com 1 st Year Financial Summary (projected):
    • Revenues…………………………….………. $ 4,130,000
    • Expenses…………………………………….. $3,803,992
    • Net Income……………………………..…… $ 326,008
    • MediaShares.com 5th Year Financial Summary (projected):
    • Revenues…………………………….……….$132,954,000
    • Expenses…………………….……………….$ 11,911,085
    • Net Income…………………………….…….$121,042,915
    • Projected Revenue Source: MediaShares.com 3mm Budget , 4/10
  • 31. MediaShares
    • MediaShares Additional Funding Opportunity:
    • Available Equity in MediaShares: 81%
    • Invested to Date: $2,307,100 ($1,900,000 personally from CEO)
    • Minimum of $500k required to Complete Our First Online IPO
    • Maximum of $3MM to implement the Complete Business Plan
    • Profitability in Year 2
  • 32. MediaShares Investor’s Equity and Earnings
    • Funding From New Equity Investor…………….. $3,000,000.
    • 30% equity purchased for $3.0 MM, investors projected return :
    • 1 st year pre-tax earnings of $ 326,008 x 30% = $97,802.
    • 3 rd year pre-tax earnings of $60,959,114 x 30% = $18,287,734.
    • 5 th year pre-tax earnings of $ 121,042,915 x 30% = $ 36,312,873.
    • Investors exit in 5 years from MediaShares.com as a public company:
    • Projected PE of 30: $121mm x 30 x 30% = $ 1,089 MM.
    • Projected Revenue Source: New MediaShares.com $10mm Budget , 5/06.
  • 33. MediaShares
    • Irvine: The New Crowdfunding Capital of The World
  • 34. U.S. Patented, SEC-Compliant, Crowdfunding for Public Financing Contact: Gene Massey Email: [email_address] Phone: (310) 476-3668