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Znak it! investor deck june 2013


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Znak it! investor deck june 2013

  1. 1. Copyright (C) 2009 by Znak, Inc. 1“Information wants to be free, and it wants to be expensive.” the WWW as a marketplace;not a billboard or soc net; Fair to everyone; Based on the naturaldynamics of free market Solves the old dilemma:Disruptive Monetization & Payment Pathways forCreative Content, Virtual Goods and ServicesMake the WWW free Fair
  2. 2. Copyright (C) 2009 by Znak, Inc.BillboardSocial NetMarketplaceThe WWW Evolves2
  3. 3. Copyright (C) 2009 by Znak, Inc.Paid Content Ecosystem3 provensolutions in one
  4. 4. Copyright (C) 2009 by Znak, Inc.Three Major Stakeholderspremium content curation andmonetization platformfrictionless access to paid content,also for “free”direct-to-user advertising opportunity& a data collection toolMarketers &AdvertisersContent ProvidersWeb Users4
  5. 5. Copyright (C) 2009 by Znak, Inc.Links and widgets, embeddableas payment gateways.Customizable shapes/colors.Easy, copy-and-paste insertion ofJS codes or API.Two mouse clicks to access and payfor selected content.Real time payment authorization & fund transfer;SSL-encrypted; CPI-compliant.5Content Providers, Large & Small
  6. 6. Copyright (C) 2009 by Znak, Inc.User Choice6Purchase subscription;(micro)pay on demand,make a donation, orEarn Free Access throughopt-in advertising
  7. 7. Copyright (C) 2009 by Znak, Inc.Award-winning “Earn Free Access”7No registration needed!No PINs! No User IDs –quick, safe and privateHigh (19.6%) conversion rate(vs. 1-2% conversion bypaywalls)Ability to bypass in-apppayment fees charged byApple, Google, etc.Up to 30%
  8. 8. Copyright (C) 2009 by Znak, Inc.A Win-Win-AND-Win Solution8 Open – platform agnostic; Flexible – multiple paymentmethods; Universal – any type/format ofpremium content or service; Simple to implement (SaaS) anduse; frictionless for the Web user; Efficient and viable – up to 20%conversion; 94% return.Marketers &AdvertisersSolves the Brand Dilemma – makes the WWW a marketplace,fair and beneficial to everyone
  9. 9. Copyright (C) 2009 by Znak, Inc. 9 /Market Potential and TrendsMarket SizeUSD 2 700 000 000 00040 times bigger than Apple‟s annual revenue;90 times Google1,350 times bigger than FacebookSource: ZenithOptimedia ; est . for2015
  10. 10. Copyright (C) 2009 by Znak, Inc. 101/5 of online content is paid now– 139% increaseBy 2016, 90% of online contentwill be paid.Simon-Kucher & PartnersOnline Revenue GrowthInternetOfflinePublishing
  11. 11. Copyright (C) 2009 by Znak, Inc.From Public Beta to BEP11Aug.2011201120122012320 content providers, 55,,000 users,in the first 3 monthsPilot projects with5 large publishersDeveloped in 2007-08 with200,000 users,1.4M EUR volumeFive additionalpublishers,LoIQ1 2013-20,00040,00060,00080,000100,000120,000140,000160,0002010 2011 2012361 8,095110,24080,968109,230159,470Revenue from Commision Exspenses/ Cost of GoodsBetaAsk meaboutresults!
  12. 12. Copyright (C) 2009 by Znak, Inc. 12CompetitionGooglee-WalletPayPalPress+PianoTinyPassFlattr Znak it!Off lineOn lineSubscriptionMicropaymentsDonationsEarn FreeAccessTransferableCredits
  13. 13. Copyright (C) 2009 by Znak, Inc.Business Model Options & BenefitsPaywalls vs. Znak it! SaaS -- no setup and system maintenancecosts; up to 94% return; can bypass app fees; Also for the “long tail;” truly World Wide; Technology- and portal-agnostic; Flexible, a la carte, on-demand access; Supports different payment methods, incl.donations and ad-sponsored access; User-centric, payment as social engagement,content sharing & P2P recommendations; Private, intrinsically safe; can be used foranonymous access – without registration;frictionless.13 Expensive, low ROI; Require large scale;convert only about 1% ofusers Create „silo effect;‟ Closed, rigid, mightcannibalize othersources of revenue; Media/publisher-centric ,not engaging ; “exploit”most loyal users
  14. 14. Copyright (C) 2009 by Znak, Inc.Major Clients and Partners14 /Existing Clients Partners Prospectswith LoI
  15. 15. Copyright (C) 2009 by Znak, Inc. 152008200920102011Web 2.0 Expo in San Francisco – first public showGerman Publishers’ Assoc. AwardDeveloped in 2007-08 withDeveloped in 2007-08in collaboration withIdeo of Palo Alto, CAEU Grant for Innovation167,000 EUREPCA Florin AwardPublic BetaLaunchedAug. 2011Barriers to EntryIP – patent pendingCPI–SSD complianceIndustry standardsLearning curveScaleSunk costs
  16. 16. Copyright (C) 2009 by Znak, Inc.Znak it! Finances in EUR16 /-100,000200,000300,000400,000500,000600,000700,000800,000900,0001,000,0002009 2010 2011 2012 2013Seed & Angel CapitalRevenue from CommisionOperational ExspensesEstimated900,000 EUR InvestedDoes not include the new round.
  17. 17. Copyright (C) 2009 by Znak, Inc.Financial Projections17-100,000200,000300,000400,000500,000600,000700,000800,0002010 2011 2012 2013Revenue from Commision 361 8,095 110,240 746,000Exspenses/ Cost of Goods 80,968 109,230 159,470 185,000With 1,500,000 EUR of additional capital:FY 2014 Projected Revenue – 3,035,000 EUR; EBITDA – 660,000 EURFY 2015 Projected Revenue -- 10,275,000 EUR; EBITDA – 3,075,000 EUR
  18. 18. Copyright (C) 2009 by Znak, Inc.Needs and Opportunities181,500,000 EUR -- Series A, equity, convertableMobileappsSales &marketingAdministration, newhiresWorkingcapitalNew Capital AllocationROI – open to IPO with additional rounds, M&A or licensingExcellent perspective: average multiple of 4.9 x revenue, as reported by BerkeryNoyes, (based on 60 M&A deals in 2012)
  19. 19. Copyright (C) 2009 by Znak, Inc. 19With Znak it! information can be “free,” easy to access and share;AND, it can be “expensive,” high-quality and profitable. Enormous opportunity ;huge marketplace; Fair and beneficial toeveryone; Customer is King Business model driven bythe real market dynamicsDisruptive Monetization & Payment Pathways forPremium ContentLet’s Make the WWW free Fair!
  20. 20. AppendixPilot Study ResultsZnak, Inc .Sunnyvale CA, USAWarsaw, Poland20
  21. 21. Copyright (C) 2009 by Znak, Inc. 21User Characteristics, by Gender & Age58.9%41.1% MalesFemales13.8%16.5%23.1%22.4%24.2%18 to 2425 to3435 to 4445 to 5455+Based on a sample of 43 299 Unique Users – Pilot Project ResultsThe sample represents gender and age distribution typical foronline sites with high-quality news/magazine content, with amajority of users being male and older.
  22. 22. Copyright (C) 2009 by Znak, Inc. 22MalesFemales 18 - 2425 - 3435 - 4445 - 5455+58.9%41.1%13.8% 16.5% 23.1%22.4%24.2%65.3%34.7%20.6%29.0%21.0%16.5%12.9%Unique Users Unique BuyersNumber of Unique Buyers – 1 281Younger users more likely to convert intoBuyers, using Znak it!Znak it! vs. paywalls – sustainable, viable systemUser Characteristics, by Gender & Age50% under 34 yrs old
  23. 23. Copyright (C) 2009 by Znak, Inc.Conversion Rates by Gender and Age23TotalMalesFemales 18 - 2425 - 3435 - 4445 - 5455+3.0%3.3%2.5%4.4% 5.2%2.7%2.2%1.6%8.7%10.3%6.4%14.5%15.6%8.2%6.3%3.3%Conversion Rate (Buyers/Uniques) Conversion Rate (Buys/Uniques)Conversion rates 9 to over15 times higher than thosegenerated by meteredpaywalls (1 - 2%)
  24. 24. Copyright (C) 2009 by Znak, Inc.Znak it! Market NicheZnak it! Payment Niche246.00%3.90%21.67%8.85%102.90%52.90%27.90%17.90%5.40%0%20%40%60%80%100%120%$0.3 $0.6 $0.9 $1.2 $1.5 $1.8 $2.5 $5.0 $20.0PercentageCommissionZnak it! standard commission ascompared to PayPal chargesTransaction valuePayPalRegularZnak it!PayPalMicropayments