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Digital Publishing
Investment Opportunity – Update
Mar 2013
Digital	
  Publishing	
  
-  Web	
  -­‐	
  Daily	
  
-  iPad	
  -­‐	
  quarterly	
  
-  Mobile	
  
Specialist	
  Sport	
  Titles	
  
-  Cycling	
  -­‐	
  2011	
  
-  Rugby	
  -­‐	
  2013	
  
-  Tri	
  –	
  2014	
  
-  Running	
  –	
  2015	
  
-  and	
  more	
  
The	
  Market	
  Opportunity	
  
-  UK	
  publishing	
  worth	
  4bn*	
  
-  Digital	
  advertising	
  double	
  digit	
  growth	
  
-  Cycling	
  is	
  fastest	
  growing	
  sport	
  in	
  UK	
  
-  1.3m	
  new	
  ‘customers’	
  every	
  year**	
  
-  Running	
  is	
  top	
  seller	
  in	
  sector	
  
-  Triathletes	
  highest	
  spenders	
  
-  Rugby	
  World	
  Cup	
  in	
  UK	
  2013	
  and	
  2015	
  
	
  
*Future	
  of	
  Publishing	
  -­‐	
  NESTA	
  Jan	
  2012	
  
**The	
  British	
  Cycling	
  Economy	
  -­‐	
  LSE	
  August	
  2011	
  
Revenue	
  Streams	
  
-  Advertising	
  -­‐	
  £10	
  to	
  £20	
  CPM	
  
-  AfRiliate	
  Sales	
  –	
  5-­‐15%	
  commission	
  
-  App	
  Sales	
  -­‐	
  1.49p	
  per	
  issue	
  
-  Future	
  revenues	
  
-  Sponsorships	
  	
  
-  Merchandising	
  
-  Licensing	
  
18%	
  
29%	
  
3%	
  
45%	
  
3%	
   2%	
  
Revenue	
  by	
  %	
  
App	
  Sales	
  
Sponsorships	
  
Merchandising	
  
Advertising	
  
AfRiliate	
  Sales	
  
Licensing	
  
Management	
  Team	
  
	
  
Derek	
  Scanlon	
  –	
  Strategy	
  
Media	
  Strategist	
  and	
  Entrepreneur	
  with	
  over	
  
25	
  years	
  experience.	
  Founder	
  -­‐	
  Denovo	
  New	
  
Media	
  in1995,	
  and	
  4	
  other	
  technology	
  start-­‐
ups.	
  Launched	
  digital	
  services	
  for	
  BBC,	
  FT,	
  
HMV,	
  Virgin,	
  Sony,	
  C4	
  and	
  many	
  more.	
  
	
  
Justin	
  Bowyer	
  –	
  Editorial	
  Director	
  
15-­‐plus	
  years	
  of	
  content	
  provision	
  for	
  clients	
  
as	
  diverse	
  as	
  Football	
  365,	
  Reuters	
  and	
  the	
  
BBC.	
  He	
  has	
  written	
  for	
  every	
  major	
  UK	
  
publisher	
  and	
  is	
  a	
  regular	
  contributor	
  to	
  both	
  
Runner’s	
  World	
  and	
  Outdoor	
  Fitness.	
  	
  
His	
  latest	
  book	
  is	
  Running:	
  Motivation,	
  
Nutrition	
  and	
  Hydration’.	
  
	
  
	
  
	
  
Stephen	
  Thompson	
  –	
  Technology	
  
A	
  key	
  engineer	
  for	
  the	
  BT	
  Mosaic	
  Video	
  on	
  
Demand	
  platform.	
  Wide	
  expertise	
  in	
  service	
  
and	
  application	
  design	
  and	
  rapid	
  prototyping.	
  
Specialist	
  in	
  iOS,	
  Objective-­‐C,	
  jQuery,	
  HTML[5],	
  
CSS[3],	
  PHP,	
  MySQL,	
  Oracle	
  PL/SQL	
  and	
  more.	
  
	
  
Jonathan	
  Hammond	
  –	
  Marketing	
  
TriGear	
  publisher	
  and	
  marketing	
  consultant.	
  
Digital,	
  PR,	
  marketing,	
  media	
  and	
  
entertainment	
  industries	
  since	
  1985.	
  Began	
  his	
  
career	
  with	
  Lynne	
  Franks	
  PR,	
  working	
  for	
  
leading	
  consumer	
  brands	
  such	
  as	
  HMV,	
  
Swatch,	
  Olympus	
  Sports.	
  He	
  started	
  his	
  Rirst	
  
company	
  in	
  1988.	
  
5	
  
IP	
  Assets	
  
-  Brands	
  and	
  Trademarks	
  
-  Content	
  Archive	
  -­‐	
  Video,	
  photo,	
  text,	
  data	
  	
  
-  Worldcup.co.uk	
  and	
  other	
  domains	
  
-  Publishing	
  Platform	
  [COPE*]	
  
-  Business	
  Intelligence	
  Application	
  [BIDMaP**]	
  
-  Video	
  Editor	
  –	
  bespoke	
  ‘How	
  To’	
  video	
  editor	
  
-  Video	
  Player	
  –	
  bespoke	
  video	
  player	
  for	
  iPad	
  and	
  Web	
  
-  Mobile	
  Code	
  Library	
  -­‐	
  for	
  iPad	
  and	
  iPhone	
  apps	
  
-  WorkRlow	
  processes	
   *Create	
  Once	
  Publish	
  Anywhere	
  
**Business	
  Intelligence	
  Dashboard	
  for	
  Magazine	
  Publishers	
  
Publishing
Server
Template
Library
Code
Library
Content
Library
iTunes
Store
iPhone
Web
iPad
Dev/Test
Server
Content
Management
System
Template
Library
Logging
Server
</>
A...
......
......
......
......
Assets
- video
- data
- text
- images
COPE
Content Production
and Publishing SystemContent
Producers
Editors
Developers
Investment	
  Opportunity	
  –	
  1	
  
-  TSB	
  funded	
  research	
  project	
  -­‐	
  £40K	
  
-  To	
  develop	
  BIDMaP	
  application	
  prototype	
  
-  Project	
  match	
  funding	
  of	
  £20K	
  for	
  5%	
  equity	
  
Investment	
  Opportunity	
  –	
  2	
  
-  Strategic	
  funding	
  -­‐	
  £120,000	
  
-  £20K	
  per	
  quarter	
  x6	
  
-  For	
  30%	
  equity	
  	
  
-  For	
  marketing,	
  product	
  development,	
  working	
  capital,	
  patents	
  
-  Breakeven	
  in	
  24	
  months	
  
ru
nnin
g
m
o n k
e
y
[GBP	
  -­‐	
  £1,000]	
   Year	
  1	
   Year	
  2	
   Year	
  3	
   Year	
  4	
   Year	
  5	
  
Sales	
   116	
   517	
   1,350	
   2,644	
   4,461	
  
Costs	
   223	
   436	
   659	
   924	
   1,210	
  
EBIT	
   107	
   81	
   691	
   1,720	
   3,251	
  
Valuation	
  [EBIT	
  x5]	
   -­‐	
   405	
   3,455	
   8,600	
   16,255	
  
Titles	
   1	
   2	
   3	
   4	
   5	
  
Unique	
  Users	
  [per	
  title,	
  000]	
   50	
   150	
   346	
   500*	
   750	
  
Page	
  Impressions	
  [per	
  title,	
  000]	
   300	
   900	
   2,080	
   3,000	
   4,500*	
  
Advertising	
  Sales	
  [£000]	
   47	
   235	
   670	
   1,298	
   2,099	
  
AfYiliate	
  Sales	
  [£000]	
  
	
  
18	
   51	
   73	
   104	
   152	
  
App	
  Sales	
  [£000]	
  
	
  
11	
   70	
   218	
   469	
   840	
  
Financial	
  Forecast	
  
*Average	
  rates	
  for	
  whole	
  sector	
  

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CPL - Investment Overview

  • 2. Digital  Publishing   -  Web  -­‐  Daily   -  iPad  -­‐  quarterly   -  Mobile   Specialist  Sport  Titles   -  Cycling  -­‐  2011   -  Rugby  -­‐  2013   -  Tri  –  2014   -  Running  –  2015   -  and  more  
  • 3. The  Market  Opportunity   -  UK  publishing  worth  4bn*   -  Digital  advertising  double  digit  growth   -  Cycling  is  fastest  growing  sport  in  UK   -  1.3m  new  ‘customers’  every  year**   -  Running  is  top  seller  in  sector   -  Triathletes  highest  spenders   -  Rugby  World  Cup  in  UK  2013  and  2015     *Future  of  Publishing  -­‐  NESTA  Jan  2012   **The  British  Cycling  Economy  -­‐  LSE  August  2011  
  • 4. Revenue  Streams   -  Advertising  -­‐  £10  to  £20  CPM   -  AfRiliate  Sales  –  5-­‐15%  commission   -  App  Sales  -­‐  1.49p  per  issue   -  Future  revenues   -  Sponsorships     -  Merchandising   -  Licensing   18%   29%   3%   45%   3%   2%   Revenue  by  %   App  Sales   Sponsorships   Merchandising   Advertising   AfRiliate  Sales   Licensing  
  • 5. Management  Team     Derek  Scanlon  –  Strategy   Media  Strategist  and  Entrepreneur  with  over   25  years  experience.  Founder  -­‐  Denovo  New   Media  in1995,  and  4  other  technology  start-­‐ ups.  Launched  digital  services  for  BBC,  FT,   HMV,  Virgin,  Sony,  C4  and  many  more.     Justin  Bowyer  –  Editorial  Director   15-­‐plus  years  of  content  provision  for  clients   as  diverse  as  Football  365,  Reuters  and  the   BBC.  He  has  written  for  every  major  UK   publisher  and  is  a  regular  contributor  to  both   Runner’s  World  and  Outdoor  Fitness.     His  latest  book  is  Running:  Motivation,   Nutrition  and  Hydration’.         Stephen  Thompson  –  Technology   A  key  engineer  for  the  BT  Mosaic  Video  on   Demand  platform.  Wide  expertise  in  service   and  application  design  and  rapid  prototyping.   Specialist  in  iOS,  Objective-­‐C,  jQuery,  HTML[5],   CSS[3],  PHP,  MySQL,  Oracle  PL/SQL  and  more.     Jonathan  Hammond  –  Marketing   TriGear  publisher  and  marketing  consultant.   Digital,  PR,  marketing,  media  and   entertainment  industries  since  1985.  Began  his   career  with  Lynne  Franks  PR,  working  for   leading  consumer  brands  such  as  HMV,   Swatch,  Olympus  Sports.  He  started  his  Rirst   company  in  1988.   5  
  • 6. IP  Assets   -  Brands  and  Trademarks   -  Content  Archive  -­‐  Video,  photo,  text,  data     -  Worldcup.co.uk  and  other  domains   -  Publishing  Platform  [COPE*]   -  Business  Intelligence  Application  [BIDMaP**]   -  Video  Editor  –  bespoke  ‘How  To’  video  editor   -  Video  Player  –  bespoke  video  player  for  iPad  and  Web   -  Mobile  Code  Library  -­‐  for  iPad  and  iPhone  apps   -  WorkRlow  processes   *Create  Once  Publish  Anywhere   **Business  Intelligence  Dashboard  for  Magazine  Publishers   Publishing Server Template Library Code Library Content Library iTunes Store iPhone Web iPad Dev/Test Server Content Management System Template Library Logging Server </> A... ...... ...... ...... ...... Assets - video - data - text - images COPE Content Production and Publishing SystemContent Producers Editors Developers
  • 7. Investment  Opportunity  –  1   -  TSB  funded  research  project  -­‐  £40K   -  To  develop  BIDMaP  application  prototype   -  Project  match  funding  of  £20K  for  5%  equity   Investment  Opportunity  –  2   -  Strategic  funding  -­‐  £120,000   -  £20K  per  quarter  x6   -  For  30%  equity     -  For  marketing,  product  development,  working  capital,  patents   -  Breakeven  in  24  months   ru nnin g m o n k e y
  • 8. [GBP  -­‐  £1,000]   Year  1   Year  2   Year  3   Year  4   Year  5   Sales   116   517   1,350   2,644   4,461   Costs   223   436   659   924   1,210   EBIT   107   81   691   1,720   3,251   Valuation  [EBIT  x5]   -­‐   405   3,455   8,600   16,255   Titles   1   2   3   4   5   Unique  Users  [per  title,  000]   50   150   346   500*   750   Page  Impressions  [per  title,  000]   300   900   2,080   3,000   4,500*   Advertising  Sales  [£000]   47   235   670   1,298   2,099   AfYiliate  Sales  [£000]     18   51   73   104   152   App  Sales  [£000]     11   70   218   469   840   Financial  Forecast   *Average  rates  for  whole  sector