Optimal Management

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26-28 MAY, 2013 - FIRST ANNUAL YOUTH ENTREPRENEURSHIP AND INNOVATORS CONFERENCE IN RUSSIA. STARTUP VILLAGE - one of the most ambitious start-up conferences in Russia, organized by Skolkovo in cooperation with partners. The conference is the first this year and will be held annually.

Optimal Management is the first conference day's pitch session participant in the IT pavillion.

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Optimal Management

  1. 1. Optimal Management, LLC Participant in SAP Startup Focus Development Accelerator Resident at Skolkovo Innovation Center We optimize Supply Chains of multinational companies
  2. 2. 2 Problem Optimization of Global Supply Chains How do you establish the most efficient Flow of Goods and corresponding Transfer Prices if your assets are in multiple countries?
  3. 3. 3 • Expansion of globalization leads to complex supply chains • Current optimization techniques are linear and limited in scope • Calculations for a mid size company involve millions of variables and several terabytes of data Problem Optimization of Global Supply Chains
  4. 4. 4 SAP ERP SAP APO SAP HANA Hadoop Cluster Innovative solution Big Data and Advanced Analytics • Sophisticated mathematical models of supply chains • New numerical methods • Modeling and Optimization on SAP HANA and Hadoop • Seamless integration with SAP Business Suite
  5. 5. 5 Business model • Assistance from SAP Startup Focus Development Accelerator at first steps • Market through SAP and SAP Partner Network The company will get its revenue from: • Licensing the products o Sales through SAP Price List o Sales through SAP Partners o Direct sales • Revenue from consulting services on development of mathematical models as well as training fees from partners involved in integration 50% revenue sharing model with the companies selling our products
  6. 6. 6 Market Size Total market size is the following • SCM market was estimated by Gartner at $7.7 billion in 2011 o SCM market for multinational companies represents 25% of the total SCM market and will grow with expansion of globalization o More than 10,000 companies in this segment will be interested in our products Targeted companies are • Big multinational corporations, including o BP, EADS, ArcelorMittal, Nestle, Toyota Motor, Intel, Pfizer, Gazprom, etc • Upper segment of middle size companies, including o Burberry, Bionorica, Kronotex, UMC(United Metallurgical Company), Russian Sea, etc.
  7. 7. 7 Competition Simultaneous optimization can yield up to 5% increase in profit Products Optimize revenues through manipulation of flow of goods Optimize revenue through manipulation of transfer prices SAP, Oracle, JDA Software and others (use fixed transfer prices) ─ THOMSON REUTERS (Global Tax Planning) ─ (use fixed flow of goods) Optimal Management
  8. 8. 8 Intellectual Property • Ph.D. thesis described mathematical model & integration with SAP • We are patenting the following innovations: • Numerical algorithm • Parallelization of Algorithm • Data model • Architecture
  9. 9. 9 • Experienced CEO with years of executive experience • World renowned CSO • 3 Dr.Sc and 2 Ph.D • 200+ publications on Optimization and Numerical Algorithms • SAP guru consultants on SCM Team
  10. 10. 10 0 5 10 15 20 25 0 5 10 15 20 25 30 35 40 45 50 1st year 2nd year 3rd year 4th year 5th year Sales Expenses Customers Financials #Customers $Millions $1.2M Raised $6.5M Raised
  11. 11. Optimal Management, LLC We are looking for $1.2M funding on patenting and prototype Russian Venture Company (RVC Seed Fund) can invest - $0.8M, Needed private funding - $0.4M. A seed investor is available to cover 50% of the required private funding = $0.2M We optimize Supply Chains of multinational companies In USA: Vitaliy Baklikov vitaliy.baklikov@optimalmngmnt.com In Russia: Andrey Sukhobokov andrey.sukhobokov@optimalmngmnt.com
  12. 12. 12 Appendices Q & A
  13. 13. 13 Value drivers • Strong team of scientists + business professionals • Patentable technology • Scalable business model • High margins (2 licenses cover the entire product cost) • 8 times return on investment in 2 years
  14. 14. 14 Exit • In 2 years (for seed investor): - Sell shares to big VC (RVC, VEB, other) • In 3-5 years: - Trade sale to SAP, Accenture, IBM, Ernst & Young, PWC, etc. • In 7-10 years: - IPO
  15. 15. 15 Where we are today • Ph.D. thesis with product ideas was defended by a team member • Entered Skolkovo program through expert committee and is now a contender for a grant • Entered SAP Startup Focus Development Accelerator program in May 2013 • Working on prototype
  16. 16. 16 What’s next Timeline 05/13 10/13 03/14 08/14 Entered SAP Startup Focus Program Proof Of Concept Built File patents Pilot customer Full Prototype Next customer

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