Send My Kid Investor Pitch

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Send My Kid is a personal crowd funding site, where parents can do aggressive fundraising for their kids’ tuition, from "crib-to-college".

Send My Kid is a personal crowd funding site, where parents can do aggressive fundraising for their kids’ tuition, from "crib-to-college".

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  • At Send My Kid, we are changing the way you plan and pay for education – by combining social fundraising, rewards spending with gamification. I like to think of it as “Personal crowdfunding for education, from crib-through-college”.
  • There isn’t one website out there that focuses on the management of tuition funds from “crib-through-college”. Education is so important to us, it’s amazing there is a huge void here. There are separate crowdfunding platforms and 529 account programs, but none that focus entirely on education from “crib-through-college”. Upromise comes close, but it isn’t enough as it doesn’t have fundraising built in. None of them offer aggressive fundraising tools.Givezooks, IndieGoGo, Kiva.org – all have nice user interfaces, which SMK needs to be successful for user registration and retention. SMK user interface isn’t bad, but it needs to be perfect.Scholarshare only focuses on 529 accounts for California. Fidelity Ufund only focuses on 529 accounts for Massachusetts. The only service that focuses on educational funding for individuals is Upromise.SMK uses PayPal – so the individual has freedom of choosing where to put the money. The only other type of service that does this well are the crowdfunding platforms – but they don’t focus on education.Rewards – Upromise provides rewards kickbacks for education. eScrip provides rewards kickbacks for schools and groups, but not individuals.There isn’t a site out there that integrates with schools.There isn’t a site out there that integrates with several different investment firms. (more than one).There isn’t a site out there that integrates with idle Grant money.There isn’t a site out there that integrates with available student loans.
  • What we have here are the “spends” to get to the next “value inflection points”.

Transcript

  • 1. Send My KidChanging the world through educationCraig EllrodJune 5, 2012
  • 2. Agenda • Pitch • Proprietary Tech • Problem • Competition • Solution • Marketing Plan • Demo • Team • Market Size • Money / Milestones • Business Model ($)2 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 3. Send My Kid Fundraising for Tuition • Using your close personal social network • Day-Pre-K-12, College, University • Combined with Gamification and Rewards Spending Vision: “Send all kids to the school Crib-through-College – debt free”3 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 4. Problem • There is no “Public” daycare for infants and Pre-K kids • Public school system is failing, Budget cuts, Tuition hikes + 10% inflation • 17.5 Million people attend College each year • 70% of them cannot afford it (12,250,000 students) • Tuition Inflation 10%, regular inflation is 4% - nobody can save fast enough In 2010 College costs: • Public University: $81,356 (4 years), at $27,967 (per year) • Private University: $161,904 (4 years), at $40,476 (per year) Hypothetically, by the time your child turns 18, • Public University: $547,322 (4 years), at $188,148 (per year)4 • © 2012 Send My Kid | Confidential – Do Not Distribute Private University: $1,089,209.15 (4 years), at $272,302.29 (per year)
  • 5. Solution Send My Kid • Automated fundraising (SMK v1 today) ᵒStart young (before birth) ᵒStart fundraising with close friends and contacts – emails with donate button ᵒBirthdays, Xmas, Weddings, Baby Showers, other holidays as appropriate ᵒBuild up funds – FAST! – get the money growing and put it to use ᵒTuition will be there when your kids are ready • Rewards Spending (SMK v2) ᵒIntegrated “Affiliate” shopping w/ automated email system ᵒCan get 6% - 10% from people shopping into students account • Gamification (SMK v2) ᵒVirtual coins (points) are rewarded just for using SMK ᵒTuition/Scholarship giveaways/lottery monthly ($100 - $1000) • Partnering (SMK v2) ᵒSchools & Financial Institutions5 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 6. Demo6 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 7. Market Size Target: Parents, Guardians of newborns. • US Residents, Ages 0-24: 104,903,974 (Children, Potential Students) • US Residents, Age 21-85: 221,557,036 (Adults, Potential Decision Makers) • US Births: 4,200,000 each year • US Total number of families with children under 18: 32,203,000 • 17.5 Million people attend college each year • College spending market was $10.5 Billion in 2009 • Online education will grow into Trillions by 20207 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 8. Market Size • Avg transaction = $1 (1% of $100) • 32,203,000 Families saving for education • Avg family receives 12 donations/year • Total market size = $1 * 32MM * 12 = $384,000,000 • 1% of total market = $3,840,000 • 5% of total market = $19,200,000 • 10% of total market = $38,400,000 • Growth: ᵒ4 MM births every year (potential students) ᵒ$48,000,000 potential increase every year8 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 9. Business Model ($) • Low burn: 0 Inventory, 0 AR, 0 AP, all software, online • Donation Model • Rewards Model • Subscription Model • Ad Model • Partner • Affiliate9 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 10. Proprietary Tech • Automated HTML Formatted email fundraising system • Accelerated funding using personal fundraising combined with rewards spending • Matching students/parents with funds (Grants, Loans) • Gamification10 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 11. Tax Implications - Gifting • http://www.irs.gov/newsroom/article/0,,id=256009,00.html • Send My Kid is not a 501(c)3 charitable organization • Donor: Gift not subject to gift tax up to $13,000, lifetime $1 MM • Donee: Doesn’t pay the tax (unless Donor fails to pay the tax) • Do not have to file a gift tax return for gifts made by paying someone’s tuition • Ultimately I would like the tax laws changed to support education ᵒRemove or Raise the $13,000 and $1 MM lifetime gift limit ᵒChange exclusion to allow for all education expenses, including books, supplies, room and board, and other expenses ᵒHave all education funds grow tax free (currently only 529 accounts are tax deferred)11 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 12. Competition Send My Scholar Fidelity UPromise eScrip Kickstarter IndieGoGo GiveZooks Kid share UFund “crib- through- college” P O O O O O O O Fundraising UX P(v2) O O O O P P P Indv Edu Focus P P P P O O O O Freedom of Investing P O O O O P P P Rewards P(v2) O O P P O O O Int – schools P(v2) O O O O O O O Int - inv firms P(v2) P P O O O O O Int - Grant Money P(v2) O O O O O O O Int © Student My Kid | Confidential – Do Not Distribute - 2012 Send13 Loans P (v2) O O O O O O O
  • 13. Marketing Plan Marketing will focus on obtaining/retaining active users • Grab as many active users as possible – focus on retaining them • Social Media – Integration with social media platforms, Ads on social media sites • SEO/SEM • PPC, Online Ads • Blogging – SendMyKid is built on top of Wordpress, blogging is built-in • Email – using our built-in email system • Radio, Print • Promotions/Contests • Gamification – Bigdoor.com14 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 14. Team Craig Ellrod (Founder, CEO) • 25+ Years deep technical experience • BS Computer Science, Masters in Business Administration • $34,000 built sendmykid.com + developer in India • http://craig.ellrod.com15 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 15. “Wow, I think you might be onto something, you need to think about it really hard.” Tim Draper16 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 16. Money / Milestones / SMK v2 Send My Kid (v2) • Marketing to get 100K users ᵒAcquisition ᵒ$75K • New UI for better UX ᵒAcquisition/Retention ᵒ$50K • Integration – Rewards, Schools, Financial Firms, Grant Money, Student Loans ᵒAcquisition, Retention, Revenue ᵒ$50K17 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 17. Money / Milestones / SMK v2 Milestone Benefit Spend Value 100K users * 12 = Marketing User Acquisition $75K $1,200,000 Retention, Revenue, Activation, Referral, New UI for better UX $50K +revenue Rewards Integration – Rewards, Schools, Financial Firms, Grant Money, Acquisition, Retention, Revenue $50K +revenue Student Loans18 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 18. Financing • $34K Self-Seeded, July ‘11 – Apr ’12 ᵒSelf funded, $34K of owner money, SendMyKid 1 (Alpha) ᵒCompleted UI & Automated eMail fundraising system • Seeking $?M Series A? ~or~ $?K Convertible Debt ᵒDevelopment - Next generation web interface ᵒMarketing – rapid user adoption ᵒHire Staff – marketing, development ᵒGet to 100,000 active users by end of the year19 © 2012 Send My Kid | Confidential – Do Not Distribute
  • 19. Leave with… •$1.5 Billion - 2011 Crowdfunding market •$2.8 Billion - 2012, 91% Growth •California Deficit $16 Billion •More education cuts on the way Crowdsourcing.org20 © 2012 Send My Kid | Confidential – Do Not Distribute