Dynamic Music Investment Opportunity

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Dynamic Music Investment Opportunity previews the start-up plan for LCS Entertainment as it seeks $2.5 Million in Capital to launch as a music marketing enterprise. Music is a highly lucrative investment opportunity, and LCS Entertainment is an ideal venue to capitalize on opportunities with independent labels and artists looking to leverage technology.

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Dynamic Music Investment Opportunity

  1. 1. LCS Entertainment A Dynamic Start Up Music Investment Opportunity Developed & Presented By: Lakes Communication Services Ph: (213) 804-4983 Email: lakescommunications@gmail.com
  2. 2. The Opportunity  Start up Music Marketing Enterprise  Specializes in Black/Urban Contemporary Music Genre  Problems: Indie Labels & Artists typically lack funding & organizational aptitude required to enjoy wide market reach.  Solutions: Capital investment, product development expertise of LCS Entertainment and marketing support that provide market advantages to partner labels and artists to maximize creative assets.  Benefits: Strong equity positions in numerous record labels and artists that also establish equally strong content development positioning to enter distinct product into marketplace.
  3. 3. Why We Are Different  Our Plan – To partner with labels and artists capitalizing on capital investment and marketing expertise to establish strong equity positions and content development relationships.  Our Focus – To enhance the interactive experience of our partners and targeted customers to the music they make and love.  Our Vision – A dynamic music marketing venture built to exploit new digital technology and social networking sensibilities, while also building lasting brands.  Our Mission – To become the premier marketer of black/urban contemporary music by maximizing the use of technology and cutting-edge concepts while also establishing new standards in the marketplace.
  4. 4. Products and Markets Commercially Recorded Music Industry  Domestic (USA) – Over $10 Billion in Revenues in 2008  Worldwide – Over $35 Billion  Projected – Downloaded music sales will soon surpass 50% plateau for all music sold Black/Urban Contemporary Music  Over 40% of Domestic Music Sales Revenues  Even greater impact upon Fashion, Advertising, Motion Pictures, Social Networking and Pop Culture The Enhanced Content Experience  Compilation CD’s, Documentary DVD’s and Gift Cards among the venues to maximize content value for creative assets  Social Networking, Marketing Muscle and Street Credibility intersect in timely manners that are equally lucrative as they are unique
  5. 5. Marketing and Sales Direct Placement Relationships  Strategic partnerships with major music retailers such as: iTunes, Walmart, Target, Kmart and Best Buy are key to our distribution strategy  Prominent positioning in The Ultimate GiftCard™ Marketplace to capitalize on marketing muscle and social networking sensibilities of DynamicDebits™ Gift Card Capitalizing on Digital Distribution Technology  Establishing strong web presences to ensure direct reach to targeted audiences  Establishing strong third-party relationships to ensure product available and brand presence throughout the marketplace
  6. 6. Competition Four Major Record Companies that comprise over 70% of all commercial music sold  Sony Music Entertainment, Universal Music Group, EMI Worldwide and Warner Music Group Apple iTunes is the World’s Largest Music Retailer  Leading independent labels usually align with companies such as Koch Entertainment for national distribution; license to majors for foreign distribution  Technology continually lowers the cost barrier for market entry  Consumers enjoy a wide range of options for acquiring and enjoying recorded music  Fact: 1% share of USA music industry exceeds $100 Million in Revenues
  7. 7. Company Management Founder – Jeffery Lakes Mr. Lakes is also the founder & CEO of Lakes Communication Services, a business development organization specializing in marketing prepaid debit products, e-Commerce solutions and commercial music. Additional Members – not yet in place Organizational model calls for the following:  Executive VP/General Manager  VP, Marketing & Communications  VP, Finance & Administration  Board of Directors  Executive Committee
  8. 8. Financial Model Maintaining Low Overhead  Highly motivated and versatile staffing model and effective use of outsourcing  Expert ancillary product development focused on leveraging repackaged product into new marketing and interactive opportunities  Effective use of affiliate marketing power (i.e., The Ultimate GiftCard ™ Marketplace and social networking Maximizing Revenue Streams  Equity positions in each label, artist and production company we partner with establishes additional revenue streams  Direct placement arrangements eliminates wholesalers who share disproportionately in the profit equation  Direct reach and access to targeted consumers also ensures minimal use of wholesalers
  9. 9. Cash Flow Overview Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Revenues $600K $5.25MM $12.20MM $21.80MM $36.55MM Expenses $1.80MM $2.10MM $4.95MM $8.35MM $14.25MM Net Profit/Loss ($1.20MM) $3.15MM $7.35MM $13.45MM $22.30MM Cash Flow/ ($500K) $2.65MM $10.00MM $23.45MM $45.75MM %Increase N/A 875% 232% 78% 68% Note: based on start up capital investment of $2,500,000
  10. 10. Investments & Returns Capital Request: $2,500,000  For Staffing  To secure equity positions in labels, artists and production teams to created enhanced content for market  To enter product into marketplace Cash Flow Summary  No additional capital requests anticipated  By Year 2, Company will achieve positive cash flow status  By Year 3 , Company will be in strong financial position to commence fully acquiring partner companies; or other timely acquisition opportunities Cash Out/Exit Strategy  After Year 5, Company will execute a PPO or seek an LBO (Merger/Acquisition)  At 2.5 multiple of fifth year revenues ($36.55MM); proceeds project to $91.40MM pre- tax/pre-expense  At 60% Equity Stake in LCS Entertainment, Investor(s) ROI projects to $54.80MM pre-tax/ pre-expense

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