Turning APStartup intoCrowdRound.bzAsia Pacific DealFlow Ltd1703 Infinitus Plaza,188 Des Voeux Rd CentralHong Kong
APStartupour mission and objectivesStartupEcosystemEntrepreneursInvestorsMentors &AdvisorsServiceProvidersAdvice andMentorship, networkintroductionsWe currently have APStartup, aportal based in HK, China thatcollates Asian startup funding dealsWe aim to rollout a similarsoftware platform on private labelto connect major players withinthe different local communities ofthe Startup EcosystemWe are developing crowdfundingcapabilities with offshore modeland onshore models, whereselected projects can be migratedfor crowdfunding.Mission and Objectives
What we need• WHAT WE NEED• We need to raise first roundof USD500,000 Execute our private label portalstrategy in Hong Kong, China,India and other countries Setup our offshorecrowdfuningoperations inBelize Recruit a team of marketingpeople Recruit a team of developers toenhance our technology• WHAT WE OFFER Pre-money valuation ofUSD1.66m Tranches of USD100,000 for6% equity Seeing 5 first round angel andstrategic investors.• WHAT IS THE POTENTIAL Cash flow from portallicensing and crowdfunding First look at all dealflowcoming from portals Anticipated 2nd round fundingof USD2-3m at valuations ofUSD5-8m within 18 months.
Serial EntrepreneurTIE MentorTEN memberCocoonianStartupsE-Finet.com (8317.hk)Fortitude SecuritiesNew Media ResearchCareerThomson FinancialSBC WarburgOffshore BankingFamily Office mgmt.About the Founderdownload Tony Cha’scareer bio
APStartup.comCreate, Build, Promote and FundWE ARE CURRENTLY…• A social networkplatform forEntrepreneurs• Apps For Startups• DealFlow forInvestors
Our ObjectivesPrivate Label software for startup communities Apps for StartupsDealFlow for Investors Crowdfunding for Companies
Individuals Startups GroupsOur technology developed so farEntrepreneurs, Investors,Mentors and &Any type of business,company or organizationPrivate Groups, clubs andassociations, local angelgroups, VC firms
Our ProductsCrowdfunding capabilities PRIVATE PORTAL SOFTWAREDeveloping offshore crowdfunding capabilitiesto enable any early stage company tocrowdfund.We license our software to customers (investors,startup clubs, associations) who wish to collateinvestment projects for funding.
Our positioning• Rewards based Portals– many in the market• Lending based Portals– Many in the marketequity basedcrowdfundingLending basedcrowdfundingsoftwareplatforms forcollating projectsrewards basedcrowdfundingDegreeofdifficultyDegree of competition in marketThe marketfor APStartup• Equity Based portals– NONE• Collating projects software– Few players in market
Tony is founder and CEOof APStartup based in Hkand China. He hasworked for 10 yearswithin the finance and ITindustry. He is a serialentrepreneur with 2successful startups in thefinance and IT space.Tony is also a TIE mentorand has an MBA fromStrathclyde University iBharat is the projectmanager forAPStartup platformdevelopment andbusiness developmentin India. He is anexpert in web basedtechnologies for 5years. He has an MBAfrom GujaratUniversityIain Reed is an ex-investment bankerand successfulentrepreneur infinancial software.He is president of TIEHK Chapter and agraduate ofCambridgeUniversityManagement TeamTony ChanCEOBharat KoryiaCTOIain ReedAdvisor
Tony is founder and CEOof APStartup based in Hkand China. He hasworked for 10 yearswithin the finance and ITindustry. He is a serialentrepreneur with 2successful startups in thefinance and IT space.Tony is also a TIE mentorand has an MBA fromStrathclyde University iJudy is an experiencedexecutive with 20years experiencecovering greaterChina. She waspreviously with AOL(Managing director),China.com (VC) andCVCRI. Judy iscurrently working inPrivate BankingJohn is an partner withthe intl. law firm -Edwards Wildmanfocusing on PE and VCtransactions. He is apioneer in Angelinvesting in Asia, amember of HKBAN andauthor of the bookAngel investing inChina.Founding TeamTony Chan80%Judy Lau10%John Lo10%
Users and Startup listing estimates02004006008001000120014001600010002000300040005000600070001 2 3 4 5 6 7 8 9 10 11 12No of usersNew usersGrowth of UsersNascent growth inY1, re-pivot and re-launch apstartup in Q1Higher pickup in usersexpected withcompletion of siteQuarterly01002003004005006001 2 3 4 5 6 7 8 9 10 11 12TotalListingsNew ListingsGrowth of Startup listingsQuarterlyNote Q1-Q4 are 2011 actual
The Crowd RoundThe Crowd Round is an earlyround of funding taken bymeans of internationalcrowdfundingWe take up to 10% of anystartup’s shares and transferthem into a Belize Companyfor internationalcrowdfunding.We sell shares in the Belizecompany to crowdfundinginvestors , upto 50 investorsare allowedCrowdRound.bzOffshore equity crowdfunding
Why offshore• Hedge funds use offshore Resolves the complexregulatory rules of differentjurisdictions Tax efficient Cost efficient High scalability• Regulation Lighter regulation onmarketing and compliance Increase benefit of• Why Belize Recognized offshorejurisdiction for companiesand funds Former UK territory withcommon law• Partners on Belize Belize Bank Belize Lawyers Belize licensed serviceproviders
Crowd Round - How it worksBelize SPV owns10% of target coinvestor1 Investor 2 Investor 3 Investor 4Target companyseekingfundraisingInvestors buys sharesdirectly in the SPVTarget co issues 10-20% of shares to SPVfor crowd roundShares Registrar, share issuedArticles, Certificate of IncorporationShareholders agreement of SPVBelize Protected Cell company
Belize Securities Trading LicenceRegulation• Regulated by Belize International FinancialServices Commission• The License shall at all times comply withthe provisions of the Act, the AmendedAct and the Regulations made thereunder, as amended from time to time, aswell as the IFS Practitioners (Code ofConduct) Regulations, 2001, as amendedfrom time to time• The Licensee is required to fullydisclose to customers the charges forservices performed by registered firmsin connection with securitiestransactions and shall not bediscriminatory between customers.List of approved Services• Money brokering.• Money lending and pawning.• Money exchange.• Safe custody services.• Accounting services• Brokerage, consultancy or advisory.Formation or management ofinternational business companiesor other offshore entities.• asset protection and management.• International collective investmentschemes (such as mutualfunds, unit trusts, etc).• Money transmission services• Payment processing services
Summary of CrowdRound• Benefits to Company Cost effective way to pursueCrowdfunding Less compliance issues withdeveloping onshore regulations Raise a global profile and not justinvestors in your own backyard Benefits to Investors Can look at truly global projects Can build a portfolio ofinvestments Convenience and anonymity ofinvesting offshore• Benefits of CrowdRound Faster process than doingAngel rounds Good way of building enoughinvestorbase for an IPO Building a userbase for yourproducts also Efficient and high impact wayof fund-raising Allows accesss to world-classstartups and early stagebusinesses
12 month plan• Establish a presenceinChina Seek entries into second tiercities in China only ( first tier toocompetitive). Utilize Regus to use their networkof offices Identify best startups andprojects that are investable. Package China DealFlow forinternational investors Rollout project portalservices Empower existing startupcommunities with our projectportal software Identify best of DealFlowprojects for targetedinvestment Provide Crowdfunding servicesfor projects either in HongKong or offshore jurisdiction.
Forecasts• Income is based onDeals income andApps subscriptionincome• Apps income is moresecure and reliablethan deal income•Deal income hashigher risks of closure• Low cost (mostlyonline) business-100,000-50,000-50,000100,000150,000200,00012 Q1 12 Q2 12 Q3 12 Q3 Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8Incometotal costsNet profitUSD Y1 Actual Y2 Y3 Y4Apps income - 43,221 230,149 575,371Deal income - 137,500 355,000 887,500Income - 180,721 585,149 1,462,871total salaries -46,500 -175,500 -210,000 -525,000Other costs -18,000 -49,950 -102,000 150,000total costs -64,500 -225,450 -312,000 -375,000Net profit -64,500 -44,730 273,149 1,087,871
Deal Brokerage(revenue forecast)• Deal brokerage will bedone via crowdround.bz• Expect to close 2-3 dealsper Quarter• Expected commissionrate is 5% on fundsraised.• Each deal needs carefuldue diligence andselection forcrowdfunding.• No of deals to accelerateas experience andcredibility is gained. 012345670200004000060000800001000001200005% Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8Expected No ofDealsDeal income
Risks and pivotsRisk Factors PivotsIT issues (as we choose tooutsource our IT instead ofdevelop in-house)Went through this is Y1, bad IT meant poorimplementation. Had to completely re-write thesystem and re-launch in y2Security hacks Because we are using open source software we needto be vigilant of security holesDeal Quality of startups Only 30% of startups meet investment quality. We usethe platform as a dealflow system to filter out gooddealsRisk of deal closing Deal closing is a low probability business. We mitigatethis by focusing on quality deals and also a widerinvestor network attracted onto the platformRisk of deal circumvention This is not easy to protect as deals are not exclusive.We protect only the leads we introduce to investors.All deals we take on has a non-circumvention andfinders fee agreement signed. We use legal escrow forcompletion of transactions.
Grace is based in Beijingand was previously atransaction lawyer withtop firms as DLA Piperand King & Wood.. Gracehas 6 years experience inChina , fluent in writtenand spoken Mandarinand Cantonese. Gracewas educated in Australiaand Malaysia.Federic was a formerbanker with WorldBank Group (MIGAChina) and with aSwiss private Bank.Frederic is also a serialentrepreneur and haslived in China formany years. Fredericspeaks and writesChinese.Justin is based in Koreaand is an entrepreneurwith experienced incorporate finance andfund-raising. Justin hasextensive contentionsinto Korea business andTarget key senior hiresGrace lee(China development)Frederic ThenaultHK-China DevJustin PaikAsia Dev
Competition analysisequity basedcrowdfundingLending based crowdfundingDegreeofdifficultyDegree of competition in marketAPSTARTUP ANDCROWD-ROUNDsoftware platforms for collating projects rewards based crowdfundingNote - We have only added dominant players in each category for reference only
Funding requirements• UDD500,000 for 30%, pre-money valuation of USD1.6m• Roll-out of a new venturetargeting equity crowdfundingand community portal roll-out• 5 Tranches of USD100,000 per6% of equity• Issue of stock options to newhires (10% pool).• Next funding round anticipatedto be 18 months to raiseUSD2m at valuation of USD5-8m.USE OF FUNDS• USD50K - Site developmentincluding mobile platform (androidand IOS)• USD50K to cover marketing andmedia campaign over 12 months• USD100K– hire team of 4-5 to covermarketing and businessdevelopment in India• USD150K– to cover deposit cost ofBelize Securities Trading License foroffshore crowdfunding• USD100K – developing satelliteoffices in China (using Regus officenetwork)• USD50K - reserve