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Live Video Dealers
Business Plan for
Live Video Dealers
Live Video Dealers
12 Wade Rd E
Signal Mountain, TN 37377
Ph.: 678-245-2306
Fax: 423-551-4742
Nicholas Van Tassell
Founder & CEO
nvantas@LiveVideoDealers.com
Jill Derby
Director of Marketing
jderby@LiveVideoDealers.com
Live Video Dealers Business Plan Page 1
Live Video Dealers
Table of Contents
I.Executive Summary................................................................................................................................................. 3
II.General Company Description........................................................................................................................... 5
III.Products and Services......................................................................................................................................... 5
IV.Marketing Plan....................................................................................................................................................... 6
V.Product........................................................................................................................................................................ 7
VI.Operational Plan.................................................................................................................................................. 10
VII.Management and Organization...................................................................................................................11
VIII.Startup Expenses and Capitalization.......................................................................................................12
IX.Revenue Projections.......................................................................................................................................... 12
X.The Future of Live Video Dealers................................................................................................................... 16
Live Video Dealers Business Plan Page 2
Live Video Dealers
I. Executive Summary
Product Differentiation
Online poker hasn’t changed much since the very beginning, almost two decades ago.
Sure internet service is faster and more reliable, and there are more games, game
variations, tournaments and players than ever before, but playing the game is still one-
dimensional; you basically share text messages with a group of faceless avatars.
And with a computer simulator dealing the cards, you can never be 100% confident that
some sort of tweaking is not done to give multiple players good hands in order to
increase pot value, thereby increasing the rake and profits for the house; otherwise
known as a ‘Bad Beat.’ Plus you can never be sure if a player is a real person or a poker
'bot', not to mention the real possibility of insider cheating at any given moment.
Live Video Dealers is turning this old fashioned and dubious gameplay into a fully
interactive and safe experience. Real cards are shuffled and dealt by live dealers right
in front of players’ eyes. Both players and dealers can see, hear and interact with each
other as each round of play unfolds.
Rapi-Deal®
Table
At the heart of this poker revolution is the Rapi-Deal®
table. This unique card table
allows a dealer to deal cards to various players for any of the supported games, game
variants, and tournaments. The dealer can also monitor players and interact with them
as though on a real table in a real casino.
Having a live motion camera has the added benefit of being able to easily verify player
eligibility; an important concern for any online gaming venue. For example, if a player
looks too young to play, the dealer can ask to show ID; just like a real casino!
The Rapid-Deal®
table easily plugs into a typical Windows®
compatible computer and is
extremely easy to setup and use. On average, dealers are dealing within a few minutes
and gain proficiency in mere hours.
Dealer Benefits and Earnings
Dealers will not only get to interact with enthusiastic players from all over the world,
but will earn money doing so. Live Video Dealers will pay up to a whopping 70% of all
Live Video Dealers Business Plan Page 3
Live Video Dealers
table rakes. A 20% commission is also paid for all tables a dealer sells.
Here’s how it works:
When you purchase a table, you will immediately start earning 45% of all hand rakes
earned by your table. Sign a friend and they purchase a table, you will get a $150.00
commission for the sale, plus you will earn 13% of all rakes their table earns.
But it gets even better. When your friends sign their friends, and their friends sign their
friends, you will earn 7% and 5% respectively from the rakes of their tables.
With the earning outline described above, it is easy to earn a sizeable income with just a
few fellow members. This is part of how we at Live Video Dealers expect to gain
market share; by having dealers’ getting the word out for us.
Casino Benefits
The Unlawful Internet Gambling Enforcement Act or UIGEA has encumbered many
online gaming ventures to date. The gist of the act states:
“The Act prohibits gambling businesses from knowingly accepting
payments in connection with the participation of another person in a bet
or wager that involves the use of the Internet.”
Live Video Dealers is extremely aware of the limitation posed on internet gaming by
this act. With live dealers, players are actually buying and trading time to play with a
live dealer. After all, dealers need to get paid for their time. Any time accrued by
playing the game can only be redeemed at a reputable brick and mortar casino in any
means the casino and player agree. It could be for comps, hotel rooms, spa time, buffets
or dinners, and yes, even chips.
Live Video Dealers will convert players’ time value to a casino’s perk or chip value at a
dollar per dollar conversion rate, minus any minimal fees charged by Automatic
Clearing House (ACH) transactions.
Live Video Dealers will also brand tables with affiliate casinos. This branding will
include not only the table, but we will also employ direct marketing advertisements
directed toward players playing on the affiliate tables through the use of inter-hand
promotional videos or images.
Live Video Dealers Business Plan Page 4
Live Video Dealers
II. General Company Description
Live Video Dealers is an online entertainment company focusing on the authentic casino
experience. We will do everything possible to achieve the perfect blend of player and
dealer experiences with those of our partnering casinos.
Our goal is to be the premier online casino entertainment destination, eclipsing the likes
of other online casino competitors.
Our philosophy is if you provide a great product, great service, and offer a superlative
experience, the word will spread and business will grow.
Our core market is actually divided into three categories: players, casinos, and
dealers. Players, of course, are our bread and butter. Without their patronage, we
and our partners would have no company. Next are both the partnering casinos
and our dealers. We need casinos so players can legally convert their time value
into tangible items, and we need our dealers in order to provide the live experience
for our players.
With nearly 8 out of 10 American households equipped with high-speed internet,
live streaming video is accessible to a majority of the American online market.
Coupled with the fact that most Americans live within close proximity to a casino,
our market has plenty of growth potential. Plus we are completely compliant with
the UIGEA, so American players are not at risk of breaking any laws.
There is also a very large international market, and we plan to sell tables and offer
dealers in other countries the same incredible opportunity.
The main strength of Live Video Dealers lies within its development team. With core
competencies of standard and online gaming, as well as technical aspects such as
security and collusion detection, streaming video, and fault tolerance, our developers
are capable of tackling virtually any challenge.
Live Video Dealers is set up as a limited liability corporation (LLC) in order to be
more flexible when partnering with casinos or private investors.
III. Products and Services
Our core product is the Rapi-Deal®
table system, but real revenue comes from online
Live Video Dealers Business Plan Page 5
Live Video Dealers
gaming services relating to online poker.
Our main competitive advantage is that we are the only online poker system that boasts
true live video streaming of not only the dealer, but also all other players at the table.
We also have a unique opportunity for dealers and casino partnerships. Through this
combination, we have everything we need to completely change the business of online
gaming.
Currently our Rapi-Deal®
table comes in three varieties.
Basic
Our basic table retails for $749.99 and includes everything you need to get started
including the table with sensors, LED indicators, card reader, web and hole card
cameras, and two decks of RFID chipped playing cards and the software to run the
table and stream the video.
Pro
Our enhanced table includes a flush mount card shuffler from Shuffle-Tech and
costs $1299.99, which reflects the extra cost of the shuffler.
Ultimate
Finally the ultimate edition retails for $1749.99 and includes everything in the Pro
model, but also includes a high spec laptop, completely setup and ready to run the
table.
All tables include the choice of a wide variety of felt colors.
There is also an opportunity for casinos to directly partnership with us. Our first tier
starts with 10 Ultimate tables and will include custom logo and branding. Contact us for
details.
IV. Marketing Plan
Like every ambitious venture that plans to capture the majority of the market, we hope
to make a major impact in the online gaming arena. The realities however often are not
in line with our expectations. With that said, we hope to gain considerable player share
through our innovative gameplay. No one else has live streaming videos of all players
Live Video Dealers Business Plan Page 6
Live Video Dealers
as well as live dealers. All things being equal, rakes taken, etc., which would a player
rather play?
While it is true that live dealers are only available on the $.50/100 stakes tables and
above (after all, dealers need to be paid for their service), a computerized dealer version
is also available for lesser stakes all the way down to $.01/.02. The computerized games,
however, also have live streaming video of all table players.
Our biggest competitors have been in the online gaming space for some time. But none
have live streaming video, nor are they legal for Unites States of America players. If Live
Video Dealers can crack into even a small percentage of the big online poker sites, we
will be hugely successful.
Posted on cardschat.com:
“Analyzing the limited publicity available, Pokerstars is grossing around
$2 billion dollars a year in rake, and roughly $1 billion in net revenue. On
a monthly basis that is about $83 million, or roughly $2.75 million a day in
net revenue. Jul 17, 2010”
That is just the revenue of the current reigning champion of online poker! There are
many others including Full Tilt Poker, Party Poker, and Absolute Poker, just to name
very few.
If Live Video Poker could achieve even 10% of that success, all partners will be extremely
wealthy. That would equate to roughly $275,000 a day. 1% would be over $27,500 a day!
V. Product
The Rapi-Deal®
table is the heart of our product line. Here is how dealers benefit from
its purchase.
Features and Benefits
Becoming a professional card dealer typically requires completion of a 4 – 8 week
training course since the course not only teaches the rules of the various games and
how to interact with players, but also how to deal various types of games and how and
when to collect rake.
Live Video Dealers Business Plan Page 7
Live Video Dealers
The Rapi-Deal®
table system has a simple, intuitive interface which uses LED lighting
cues that indicate not only when to deal a card, but to how and where such as to which
seat, is it face down or face up, is it a hole card, a community card, or even a burn card.
The table also indicates all game states such as waiting for players, time to deal a card,
when a player is betting, when a player folds, which players have won a pot, and
which player has tipped the dealer.
Since this is all software driven, collecting chips and rake calculation is performed
completely without dealer’s interaction. This decreases dealer responsibility while
increasing hand speed.
Satisfaction with the table is unconditionally guaranteed from defects for a period of
12 months for all electronics, and 3 months for all mechanical parts including the
robotic arm assembly for the hole card camera and the playing cards. The playing
cards will eventually wear out and require replacement just as in a real casino.
Business Opportunity for Dealers
Upon purchasing a Rapi-Deal®
table, a dealer is automatically enrolled to earn 45% of
all rakes their table earns. Furthermore, dealers are also enrolled in our unique
marketing system.
Our marketing is system is one of the few service-based marketing systems available.
Here’s how it works. For every table you directly sell, you will get a $150.00
commission. You will also earn 13% of all rakes that table earns. The rake earning
potential goes down two more levels. At level 3, the rake percentage is 7 and at level
4 the percentage is 5. This adds up to a whopping 70%!
An average dealer deals approximately 30 hands per hour and the average rake per
hand is $3. Therefore, a dealer will typically earn 30 * $3 = $90 * 45% = $40.50 per
hour.
We recommend a player sell five tables. At $150.00 commission for each table, this
represents paying for their own table. But that’s only the start!
Take the 13% rake for 5 tables with the same dealer and rake averages proposed
earlier:
Live Video Dealers Business Plan Page 8
Live Video Dealers
5 tables * 30 hands per hour * $3 per hand * 13% = $58.50 per hour. And the dealer
will make this percentage whenever these tables are in operation!
For a filled out stack of tables, we get the following breakdown:
Level 1 (1 table @ 45%): $40.50
Level 2 (5 tables @ 13%): $58.50
Level 3 (25 tables @ 7%): $157.50
Level 4 (125 tables @ 5%):
$562.50
The total amount possible is $819.00 per hour. And that does not take into account
player tips which are offered to all players after every hand in increments up to $1!
Plus, a dealer can have as many people horizontally positioned tables as well; in other
words, more than just the 5 on Level 2. Dealers get commissions on all tables they sell
and will make 13% rake commission on all those tables and so on vertically down the
chain.
All earnings will be paid net 30 days after an initial 4 week period. It is the
responsibility of the dealer to pay all income taxes. As a result, a 1099-MISC form
will be sent and filed with the federal government for stateside dealers.
Customers
Our target customer for the Rapi-Deal®
table includes college students who always
need extra money but do not have the luxury of time, home makers who
predominantly stay at home to take of children or an elderly parent, and anyone with
an entrepreneurial spirit who enjoys interacting with people from all over the world
in the comfort and security of their own home.
Businesses may also wish to become a partner. Business partners enjoy complete
branding of all purchased Rapi-Deal®
tables as well as earning 70% rake. However,
business partners will not be eligible for the levelled marketing plan and a minimum
table purchase is required.
Competition
No competitors currently compete in terms of selling poker tables designed for
Live Video Dealers Business Plan Page 9
Live Video Dealers
the online gaming market since all our competitors utilize a computerized
dealing solution to deal all hands.
Although there are many card and poker specific tables on the market, none
allow the customer such a unique and profitable business opportunity.
Niche
Our niche in the marketplace is that Live Video Dealers is the only online gaming system
which utilizes live streaming video for its players, a generous earning scale for its
dealers, and provides a valuable partnership agreement with casinos.
We are the only system available that does all three: a Win –Win – Win philosophy!
VI. Operational Plan
Live Video Dealers is currently operating in Chattanooga, TN mostly due to the 10 gig
internet service provided there. Since tables are operated independently, the outcome
of every hand must be validated by the system of record at the end of every hand.
This processing system currently resides in Chattanooga, TN.
Production
We are actively looking to outsource table production. The prototypes we have built to
date are made of fiber board and are a bit heavy: about 17 lbs. To reduce shipping costs
as well as to provide better quality, a plastic resin table is desired. We are also planning
to outsource production of the mechanical and electrical elements as well. This is so we
can focus on what we do best, creating awesome software and focusing on the business.
The table itself, including all the table components, electronics and mechanical parts of
the system cost approximately $200.00. Outsourcing should shave at least $50.00 off the
price of the table, possibly even 50%.
Personnel
Resources will be required to augment the development team. In short a short time
span, we plan to hire two senior software developers and a web developer. The senior
developers will be tasked to perform needed maintenance and enhancements to the table
Live Video Dealers Business Plan Page 10
Live Video Dealers
software, accounting software, client software, hand validation and control software.
The web developer will be tasked with updating and maintaining the web site presence
as well as any custom branding with our partners.
Cost projection for the senior developers is $105k per annum, and the web developer is
projected to be around $75K per annum.
We will also need the expertise a graphics artist on an as needed contract basis. Typical
contract rates in the area are $60-65 per hour.
The founder and CEO, Mr. Nicholas Van Tassell, will transition into director and lead
software architect roles. Ms. Jill Derby will function as lead marketer and contact point
as well as handling tier one technical support.
Once again, Chattanooga is an excellent location for finding quality software developers
and graphics artists.
Credit Policies
There are currently no plans to sell tables on credit. However, this may change in the
near future to something similar to a 3 payment plan where payments can span 3 months
or a similar program.
Players will not be extended any credit, although we are planning to match a certain
deposit amount up to a maximum of $200.00.
VII. Management and Organization
Founder and CEO, Mr. Nicholas Van Tassell is responsible for managing the day to day
operations including, but not limited to, technical direction, issue resolution, and
partnership management. Ms. Jill Derby is the backup for Mr. Van Tassell, but also
functions as the chief financial officer and first level technical support specialist. Ms.
Derby is also responsible for players, dealers, as well as partnering casinos to get their
payments in a quick and secure manner.
Professional and Advisory Support
We are currently seeking investors who can provide input and collaborate on corporate
objectives, initiatives, and direction.
Live Video Dealers Business Plan Page 11
Live Video Dealers
VIII. Startup Expenses and Capitalization
Since the main profits of Live Video Dealers come from players and not through selling
the Rapi-Deal®
tables, startup expenses will be limited to advertising. This is where
casino partnerships can play a huge role. When players end their stay at a partnering
casino, the casino can pass along information relating to their online presence through
either Live Video Dealers website or through a specifically branded Live Video Dealers
hosted site.
Advertising for dealers and selling the Rapi-Deal®
table system will initially come from
Crowd Funding sites such as Kickstarter.com and Indiegogo.com, among others. It is
also anticipated that many players can be acquired through these means, keeping
advertisement costs extremely low.
IX. Revenue Projections
The majority of the development to allow Live Video Dealers to go live has already been
completed. In fact, we are ready to start selling tables. Therefore the only startup capital
really needed is geared toward marketing and continual development to bring on new
types of hands into play.
6 Month Profit and Loss Projection
The first part of the business kickoff will be geared toward the sale of the Rapi-Deal®
table system. Through Kickstarter and other crowd-funding sites such as Indiegogo, we
hope to sell 200 tables over the next 4 months. Kickstarter will last 2 months and have
special pricing earmarked at $500.00 for the basic system. Indiegogo will last just as long
and special pricing will also apply. Upgraded systems, such as the Pro and Ultimate
versions, will also be discounted by $249.99.
We also hope to partner with several casinos, in order to help our brand and drive traffic
to these valued partners. The basic partnership plan includes 10 ultimate tables with
custom branding, completely installed at their location.
Players will have a significant input on our bottom line. We aim to have to have a
minimum of 33% player to table ratio for our live dealers over a 12 hour span;
accounting for the USA time region alone. Calculating 200 tables each holding up to 9
Live Video Dealers Business Plan Page 12
Live Video Dealers
players at 33%, and the average playing time per player is 2 hours, we get the following:
Player Calculation
9 * 33% = 3 players per table, each player plays 2 hours, so 12 hours / 2 hours is a
multiple of 6. Given 200 tables, we will then need 3 players * 6 hourly multiple * 200
tables equates to 3,600 players over the next 6 months.
We are being conservative in our estimates. Please keep in mind this does not include
revenue from the lesser stakes tables, nor a worldwide distribution plan. Partnership
players are not included as well since we expect partnership tables to be close to capacity
24/7. The spreadsheet below is calculated with half that capacity or 12/7.
The following chart illustrates our projected income over the next 6 month period. It is
created by predicting 50 tables a month being sold through two rounds of crowd-
funding such as Kickstarter.com and Indiegogo.com. Dealer sales are estimated to be a
low 10% of the outstanding tables; after all, dealers will want to grow their levels to rake
in more profit (pardon the pun!)
With marketing on crowd-funding sites, we will also offer a matching bonus for players
up to $200.00. We are anticipating this leads to significant player counts over the next 6
months. The total revenue expected by these players is defined by the current table
capacity. In other words, we need to balance the number of players vs. the number of
available tables. The projected rake revenue is calculated by taking one third of the table
capacity, multiplied by a multiple of 6; which represents the number of players in 12
hours who play for 2 hours. This is essentially twice the table count; once again, a very
conservative estimate.
Since the first two months are for dealers to get used to their tables, we will let the
players play free for the first month, so no revenue will be generated from rakes in the
first month of operation.
Partnerships
We also expect at least two partnerships added per month as we scale up our marketing
efforts. A partnership includes 10 Ultimate tables and branding worth $20,000.00.
Projected Rake
The projected rake revenue going forward is rather difficult to project since we pay out
Live Video Dealers Business Plan Page 13
Live Video Dealers
varying percentages to dealers and their down-levels. 45% of the rake is earned by the
top-level dealer, followed 13%, 7% and 5%. Since there will be many more dealers with
no down-levels established, earnings estimates are simplified to be 50% of the total rake
for that table. A table is expected to be in operation for at least 6 hours per day, dealing
only 20 hands per hour and generating $3 in rakes per hand.
So the rake revenue calculation is:
# of tables * 20 hands per/hour * $3 rake/hand * 6 hours per day
Ex.: 1 table times 20 hands/hour times $3 rake/hand = $60 hour/table
Or $360.00 for a 6 hour day * 50% commission = $180.00 hour/table after
commission
Please keep in mind these figures are undeniably low and do not account for the lower
stakes hands which require no dealer and earn 100% of the rakes.
Partnership tables are expected to be near capacity for 12 hours a day. So the rake
calculation is $5 rake/hand times 30 hands/hour or $150 hour/table. Partners get 70%
of the rake, so our take is $540.00 for a 12 hour day.
Live Video Dealers Business Plan Page 14
Live Video Dealers
Revenue Projections
Base Projection Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
Total Revenue $65,000.00 $1,508,750.00 $2,988,500.00 $4,548,200.00 $5,774,050.00 $5,955,550.00
Table Sales $25,000.00 $28,750.00 $32,500.00 $37,000.00 $17,250.00 $18,750.00
Crowd-fund 50 50 50 50 0 0
Dealer Sales 0 5 10 16 23 25
Partnerships $40,000.00 $40,000.00 $40,000.00 $40,000.00 $40,000.00 $40,000.00
Count 2 2 2 2 2 2
Players $0.00 $360,000.00 $756,000.00 $1,231,200.00 $1,396,800.00 $1,576,800.00
Partnership Players $0.00 $1,080,000.00 $2,160,000.00 $3,240,000.00 $4,320,000.00 $4,320,000.00
$5,896,800.00
Expenses
Advertising $1,750.00 $1,750.00 $1,750.00 $1,750.00 $0.00 $0.00
Marketing $2,500.00 $2,500.00 $2,500.00 $2,500.00 $2,500.00 $2,500.00
Salaries $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00
Table Parts $34,000.00 $35,000.00 $36,000.00 $37,200.00 $28,600.00 $29,000.00
Office Supplies $500.00 $500.00 $500.00 $500.00 $500.00 $500.00
Commissions
Table Sales $0.00 $1,250.00 $2,500.00 $4,000.00 $5,750.00 $6,250.00
Table Rakes $0.00 $180,000.00 $378,000.00 $615,600.00 $698,400.00 $788,400.00
Partnership $0.00 $756,000.00 $1,512,000.00 $2,268,000.00 $3,024,000.00 $3,024,000.00
Total P/L $11,250.00 $516,750.00 $1,040,250.00 $1,603,650.00 $1,999,300.00 $2,089,900.00
Annotations:
1 – Crowd-funding initiative ends.
2 – Players are not expected to make an impact until after the first crowd-funding round is over. Players will be
allowed to play for free during this period so dealers can get used to the tables and any issues get resolved.
Variables: Partnerships per Month 2
Hands per Hour (LVD) 20 Days per Month (LVD) 20
Live Video Dealers Business Plan Page 15
Live Video Dealers
Hands per Hour (pro) 30 Days per Month (pro) 30
Hours per Day (LVD) 6 Crowd-Fund Table Cost $500.00
Hours per Day (pro) 12 Dealer Sales Price $750.00
Rakes per Hand (LVD) $3.00 Cost for Basic $200.00
Rakes per Hand (pro) $5.00 Cost for Pro $700.00
Percentage (LVD) 50 Cost for Ultimate $1,200.00
Percentage (pro) 70 Partnership Table Cost $1,750.00
Table Commission $250.00 Crowd-fund Table Count 50
The above variables were used in the spreadsheet above to show how very little it takes
to earn huge profits. For example, a single table, earning a mere $3 rake per hand, with
only 20 hands per hour 6 hours per day and 5 days a week earns $7,200.00 a month.
Of course the more players on a table, the higher the rakes will be.
Investment Opportunity
Currently we are offering a limited time engagement to invest with Live Video Dealers.
We will sell 0.2% of our rake profits, before commissions are paid, for each $100K you
invest.
Rake profits for month 6, representing only 279 regular and 120 partner tables, is
$5,896,800.00. Multiplying over 12 months and taking 0.2%, the profit is a whopping
$141,523.20!
The even better news is that you may invest up to 30% in Live Video Dealers! So a $15M
investment now could pay out $21,228,480 every year! And that is only with a fraction
of the targeted number of 1000 tables! Major investors will also have a seat on the
advisory board which will directly influence the steering committee in regards to
corporate direction.
We are also interested in going IPO within 3 to 5 years. Amaya Gaming Group bought
Pokerstars for $4.9 Billion in cash on June 12, 2014 and was completed August 1, 2014. A
similar agreement would net a $15 Million investment almost $1.5 Billion!
X. The Future of Live Video Dealers
The future is very bright at Live Video Dealers. Through partnerships and dealers all
across the globe, we hope to be the preeminent online gaming source.
Live Video Dealers Business Plan Page 16
Live Video Dealers
We already have in the works several hand variations for our core product, the Rapi-
Deal®
table. The games include Hold’em, Omaha Hi, Omaha Hi-Low, 7-card Stud, 7-
card Razz, London Lowball, and follow the queen.
These are all hands that are currently served by other online systems. However, since
we have real dealers, we also want to introduce hands that require more thought from
the dealer. Hands such as 5-card Draw, and even games where players take turns
selecting wild cards! With the innovative LED technology indicating to the dealer what
to do, this is all easily possible and easily conveyed to the dealer.
Live Video Dealers is also seeking to expand the Live Dealer and Players concept into
more gaming venues such as Blackjack, Roulette, and Pai Gow Poker.
So join us today and reap the benefits of this new and exciting technological
breakthrough!
Live Video Dealers Business Plan Page 17

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Business Plan

  • 1. Live Video Dealers Business Plan for Live Video Dealers Live Video Dealers 12 Wade Rd E Signal Mountain, TN 37377 Ph.: 678-245-2306 Fax: 423-551-4742 Nicholas Van Tassell Founder & CEO nvantas@LiveVideoDealers.com Jill Derby Director of Marketing jderby@LiveVideoDealers.com Live Video Dealers Business Plan Page 1
  • 2. Live Video Dealers Table of Contents I.Executive Summary................................................................................................................................................. 3 II.General Company Description........................................................................................................................... 5 III.Products and Services......................................................................................................................................... 5 IV.Marketing Plan....................................................................................................................................................... 6 V.Product........................................................................................................................................................................ 7 VI.Operational Plan.................................................................................................................................................. 10 VII.Management and Organization...................................................................................................................11 VIII.Startup Expenses and Capitalization.......................................................................................................12 IX.Revenue Projections.......................................................................................................................................... 12 X.The Future of Live Video Dealers................................................................................................................... 16 Live Video Dealers Business Plan Page 2
  • 3. Live Video Dealers I. Executive Summary Product Differentiation Online poker hasn’t changed much since the very beginning, almost two decades ago. Sure internet service is faster and more reliable, and there are more games, game variations, tournaments and players than ever before, but playing the game is still one- dimensional; you basically share text messages with a group of faceless avatars. And with a computer simulator dealing the cards, you can never be 100% confident that some sort of tweaking is not done to give multiple players good hands in order to increase pot value, thereby increasing the rake and profits for the house; otherwise known as a ‘Bad Beat.’ Plus you can never be sure if a player is a real person or a poker 'bot', not to mention the real possibility of insider cheating at any given moment. Live Video Dealers is turning this old fashioned and dubious gameplay into a fully interactive and safe experience. Real cards are shuffled and dealt by live dealers right in front of players’ eyes. Both players and dealers can see, hear and interact with each other as each round of play unfolds. Rapi-Deal® Table At the heart of this poker revolution is the Rapi-Deal® table. This unique card table allows a dealer to deal cards to various players for any of the supported games, game variants, and tournaments. The dealer can also monitor players and interact with them as though on a real table in a real casino. Having a live motion camera has the added benefit of being able to easily verify player eligibility; an important concern for any online gaming venue. For example, if a player looks too young to play, the dealer can ask to show ID; just like a real casino! The Rapid-Deal® table easily plugs into a typical Windows® compatible computer and is extremely easy to setup and use. On average, dealers are dealing within a few minutes and gain proficiency in mere hours. Dealer Benefits and Earnings Dealers will not only get to interact with enthusiastic players from all over the world, but will earn money doing so. Live Video Dealers will pay up to a whopping 70% of all Live Video Dealers Business Plan Page 3
  • 4. Live Video Dealers table rakes. A 20% commission is also paid for all tables a dealer sells. Here’s how it works: When you purchase a table, you will immediately start earning 45% of all hand rakes earned by your table. Sign a friend and they purchase a table, you will get a $150.00 commission for the sale, plus you will earn 13% of all rakes their table earns. But it gets even better. When your friends sign their friends, and their friends sign their friends, you will earn 7% and 5% respectively from the rakes of their tables. With the earning outline described above, it is easy to earn a sizeable income with just a few fellow members. This is part of how we at Live Video Dealers expect to gain market share; by having dealers’ getting the word out for us. Casino Benefits The Unlawful Internet Gambling Enforcement Act or UIGEA has encumbered many online gaming ventures to date. The gist of the act states: “The Act prohibits gambling businesses from knowingly accepting payments in connection with the participation of another person in a bet or wager that involves the use of the Internet.” Live Video Dealers is extremely aware of the limitation posed on internet gaming by this act. With live dealers, players are actually buying and trading time to play with a live dealer. After all, dealers need to get paid for their time. Any time accrued by playing the game can only be redeemed at a reputable brick and mortar casino in any means the casino and player agree. It could be for comps, hotel rooms, spa time, buffets or dinners, and yes, even chips. Live Video Dealers will convert players’ time value to a casino’s perk or chip value at a dollar per dollar conversion rate, minus any minimal fees charged by Automatic Clearing House (ACH) transactions. Live Video Dealers will also brand tables with affiliate casinos. This branding will include not only the table, but we will also employ direct marketing advertisements directed toward players playing on the affiliate tables through the use of inter-hand promotional videos or images. Live Video Dealers Business Plan Page 4
  • 5. Live Video Dealers II. General Company Description Live Video Dealers is an online entertainment company focusing on the authentic casino experience. We will do everything possible to achieve the perfect blend of player and dealer experiences with those of our partnering casinos. Our goal is to be the premier online casino entertainment destination, eclipsing the likes of other online casino competitors. Our philosophy is if you provide a great product, great service, and offer a superlative experience, the word will spread and business will grow. Our core market is actually divided into three categories: players, casinos, and dealers. Players, of course, are our bread and butter. Without their patronage, we and our partners would have no company. Next are both the partnering casinos and our dealers. We need casinos so players can legally convert their time value into tangible items, and we need our dealers in order to provide the live experience for our players. With nearly 8 out of 10 American households equipped with high-speed internet, live streaming video is accessible to a majority of the American online market. Coupled with the fact that most Americans live within close proximity to a casino, our market has plenty of growth potential. Plus we are completely compliant with the UIGEA, so American players are not at risk of breaking any laws. There is also a very large international market, and we plan to sell tables and offer dealers in other countries the same incredible opportunity. The main strength of Live Video Dealers lies within its development team. With core competencies of standard and online gaming, as well as technical aspects such as security and collusion detection, streaming video, and fault tolerance, our developers are capable of tackling virtually any challenge. Live Video Dealers is set up as a limited liability corporation (LLC) in order to be more flexible when partnering with casinos or private investors. III. Products and Services Our core product is the Rapi-Deal® table system, but real revenue comes from online Live Video Dealers Business Plan Page 5
  • 6. Live Video Dealers gaming services relating to online poker. Our main competitive advantage is that we are the only online poker system that boasts true live video streaming of not only the dealer, but also all other players at the table. We also have a unique opportunity for dealers and casino partnerships. Through this combination, we have everything we need to completely change the business of online gaming. Currently our Rapi-Deal® table comes in three varieties. Basic Our basic table retails for $749.99 and includes everything you need to get started including the table with sensors, LED indicators, card reader, web and hole card cameras, and two decks of RFID chipped playing cards and the software to run the table and stream the video. Pro Our enhanced table includes a flush mount card shuffler from Shuffle-Tech and costs $1299.99, which reflects the extra cost of the shuffler. Ultimate Finally the ultimate edition retails for $1749.99 and includes everything in the Pro model, but also includes a high spec laptop, completely setup and ready to run the table. All tables include the choice of a wide variety of felt colors. There is also an opportunity for casinos to directly partnership with us. Our first tier starts with 10 Ultimate tables and will include custom logo and branding. Contact us for details. IV. Marketing Plan Like every ambitious venture that plans to capture the majority of the market, we hope to make a major impact in the online gaming arena. The realities however often are not in line with our expectations. With that said, we hope to gain considerable player share through our innovative gameplay. No one else has live streaming videos of all players Live Video Dealers Business Plan Page 6
  • 7. Live Video Dealers as well as live dealers. All things being equal, rakes taken, etc., which would a player rather play? While it is true that live dealers are only available on the $.50/100 stakes tables and above (after all, dealers need to be paid for their service), a computerized dealer version is also available for lesser stakes all the way down to $.01/.02. The computerized games, however, also have live streaming video of all table players. Our biggest competitors have been in the online gaming space for some time. But none have live streaming video, nor are they legal for Unites States of America players. If Live Video Dealers can crack into even a small percentage of the big online poker sites, we will be hugely successful. Posted on cardschat.com: “Analyzing the limited publicity available, Pokerstars is grossing around $2 billion dollars a year in rake, and roughly $1 billion in net revenue. On a monthly basis that is about $83 million, or roughly $2.75 million a day in net revenue. Jul 17, 2010” That is just the revenue of the current reigning champion of online poker! There are many others including Full Tilt Poker, Party Poker, and Absolute Poker, just to name very few. If Live Video Poker could achieve even 10% of that success, all partners will be extremely wealthy. That would equate to roughly $275,000 a day. 1% would be over $27,500 a day! V. Product The Rapi-Deal® table is the heart of our product line. Here is how dealers benefit from its purchase. Features and Benefits Becoming a professional card dealer typically requires completion of a 4 – 8 week training course since the course not only teaches the rules of the various games and how to interact with players, but also how to deal various types of games and how and when to collect rake. Live Video Dealers Business Plan Page 7
  • 8. Live Video Dealers The Rapi-Deal® table system has a simple, intuitive interface which uses LED lighting cues that indicate not only when to deal a card, but to how and where such as to which seat, is it face down or face up, is it a hole card, a community card, or even a burn card. The table also indicates all game states such as waiting for players, time to deal a card, when a player is betting, when a player folds, which players have won a pot, and which player has tipped the dealer. Since this is all software driven, collecting chips and rake calculation is performed completely without dealer’s interaction. This decreases dealer responsibility while increasing hand speed. Satisfaction with the table is unconditionally guaranteed from defects for a period of 12 months for all electronics, and 3 months for all mechanical parts including the robotic arm assembly for the hole card camera and the playing cards. The playing cards will eventually wear out and require replacement just as in a real casino. Business Opportunity for Dealers Upon purchasing a Rapi-Deal® table, a dealer is automatically enrolled to earn 45% of all rakes their table earns. Furthermore, dealers are also enrolled in our unique marketing system. Our marketing is system is one of the few service-based marketing systems available. Here’s how it works. For every table you directly sell, you will get a $150.00 commission. You will also earn 13% of all rakes that table earns. The rake earning potential goes down two more levels. At level 3, the rake percentage is 7 and at level 4 the percentage is 5. This adds up to a whopping 70%! An average dealer deals approximately 30 hands per hour and the average rake per hand is $3. Therefore, a dealer will typically earn 30 * $3 = $90 * 45% = $40.50 per hour. We recommend a player sell five tables. At $150.00 commission for each table, this represents paying for their own table. But that’s only the start! Take the 13% rake for 5 tables with the same dealer and rake averages proposed earlier: Live Video Dealers Business Plan Page 8
  • 9. Live Video Dealers 5 tables * 30 hands per hour * $3 per hand * 13% = $58.50 per hour. And the dealer will make this percentage whenever these tables are in operation! For a filled out stack of tables, we get the following breakdown: Level 1 (1 table @ 45%): $40.50 Level 2 (5 tables @ 13%): $58.50 Level 3 (25 tables @ 7%): $157.50 Level 4 (125 tables @ 5%): $562.50 The total amount possible is $819.00 per hour. And that does not take into account player tips which are offered to all players after every hand in increments up to $1! Plus, a dealer can have as many people horizontally positioned tables as well; in other words, more than just the 5 on Level 2. Dealers get commissions on all tables they sell and will make 13% rake commission on all those tables and so on vertically down the chain. All earnings will be paid net 30 days after an initial 4 week period. It is the responsibility of the dealer to pay all income taxes. As a result, a 1099-MISC form will be sent and filed with the federal government for stateside dealers. Customers Our target customer for the Rapi-Deal® table includes college students who always need extra money but do not have the luxury of time, home makers who predominantly stay at home to take of children or an elderly parent, and anyone with an entrepreneurial spirit who enjoys interacting with people from all over the world in the comfort and security of their own home. Businesses may also wish to become a partner. Business partners enjoy complete branding of all purchased Rapi-Deal® tables as well as earning 70% rake. However, business partners will not be eligible for the levelled marketing plan and a minimum table purchase is required. Competition No competitors currently compete in terms of selling poker tables designed for Live Video Dealers Business Plan Page 9
  • 10. Live Video Dealers the online gaming market since all our competitors utilize a computerized dealing solution to deal all hands. Although there are many card and poker specific tables on the market, none allow the customer such a unique and profitable business opportunity. Niche Our niche in the marketplace is that Live Video Dealers is the only online gaming system which utilizes live streaming video for its players, a generous earning scale for its dealers, and provides a valuable partnership agreement with casinos. We are the only system available that does all three: a Win –Win – Win philosophy! VI. Operational Plan Live Video Dealers is currently operating in Chattanooga, TN mostly due to the 10 gig internet service provided there. Since tables are operated independently, the outcome of every hand must be validated by the system of record at the end of every hand. This processing system currently resides in Chattanooga, TN. Production We are actively looking to outsource table production. The prototypes we have built to date are made of fiber board and are a bit heavy: about 17 lbs. To reduce shipping costs as well as to provide better quality, a plastic resin table is desired. We are also planning to outsource production of the mechanical and electrical elements as well. This is so we can focus on what we do best, creating awesome software and focusing on the business. The table itself, including all the table components, electronics and mechanical parts of the system cost approximately $200.00. Outsourcing should shave at least $50.00 off the price of the table, possibly even 50%. Personnel Resources will be required to augment the development team. In short a short time span, we plan to hire two senior software developers and a web developer. The senior developers will be tasked to perform needed maintenance and enhancements to the table Live Video Dealers Business Plan Page 10
  • 11. Live Video Dealers software, accounting software, client software, hand validation and control software. The web developer will be tasked with updating and maintaining the web site presence as well as any custom branding with our partners. Cost projection for the senior developers is $105k per annum, and the web developer is projected to be around $75K per annum. We will also need the expertise a graphics artist on an as needed contract basis. Typical contract rates in the area are $60-65 per hour. The founder and CEO, Mr. Nicholas Van Tassell, will transition into director and lead software architect roles. Ms. Jill Derby will function as lead marketer and contact point as well as handling tier one technical support. Once again, Chattanooga is an excellent location for finding quality software developers and graphics artists. Credit Policies There are currently no plans to sell tables on credit. However, this may change in the near future to something similar to a 3 payment plan where payments can span 3 months or a similar program. Players will not be extended any credit, although we are planning to match a certain deposit amount up to a maximum of $200.00. VII. Management and Organization Founder and CEO, Mr. Nicholas Van Tassell is responsible for managing the day to day operations including, but not limited to, technical direction, issue resolution, and partnership management. Ms. Jill Derby is the backup for Mr. Van Tassell, but also functions as the chief financial officer and first level technical support specialist. Ms. Derby is also responsible for players, dealers, as well as partnering casinos to get their payments in a quick and secure manner. Professional and Advisory Support We are currently seeking investors who can provide input and collaborate on corporate objectives, initiatives, and direction. Live Video Dealers Business Plan Page 11
  • 12. Live Video Dealers VIII. Startup Expenses and Capitalization Since the main profits of Live Video Dealers come from players and not through selling the Rapi-Deal® tables, startup expenses will be limited to advertising. This is where casino partnerships can play a huge role. When players end their stay at a partnering casino, the casino can pass along information relating to their online presence through either Live Video Dealers website or through a specifically branded Live Video Dealers hosted site. Advertising for dealers and selling the Rapi-Deal® table system will initially come from Crowd Funding sites such as Kickstarter.com and Indiegogo.com, among others. It is also anticipated that many players can be acquired through these means, keeping advertisement costs extremely low. IX. Revenue Projections The majority of the development to allow Live Video Dealers to go live has already been completed. In fact, we are ready to start selling tables. Therefore the only startup capital really needed is geared toward marketing and continual development to bring on new types of hands into play. 6 Month Profit and Loss Projection The first part of the business kickoff will be geared toward the sale of the Rapi-Deal® table system. Through Kickstarter and other crowd-funding sites such as Indiegogo, we hope to sell 200 tables over the next 4 months. Kickstarter will last 2 months and have special pricing earmarked at $500.00 for the basic system. Indiegogo will last just as long and special pricing will also apply. Upgraded systems, such as the Pro and Ultimate versions, will also be discounted by $249.99. We also hope to partner with several casinos, in order to help our brand and drive traffic to these valued partners. The basic partnership plan includes 10 ultimate tables with custom branding, completely installed at their location. Players will have a significant input on our bottom line. We aim to have to have a minimum of 33% player to table ratio for our live dealers over a 12 hour span; accounting for the USA time region alone. Calculating 200 tables each holding up to 9 Live Video Dealers Business Plan Page 12
  • 13. Live Video Dealers players at 33%, and the average playing time per player is 2 hours, we get the following: Player Calculation 9 * 33% = 3 players per table, each player plays 2 hours, so 12 hours / 2 hours is a multiple of 6. Given 200 tables, we will then need 3 players * 6 hourly multiple * 200 tables equates to 3,600 players over the next 6 months. We are being conservative in our estimates. Please keep in mind this does not include revenue from the lesser stakes tables, nor a worldwide distribution plan. Partnership players are not included as well since we expect partnership tables to be close to capacity 24/7. The spreadsheet below is calculated with half that capacity or 12/7. The following chart illustrates our projected income over the next 6 month period. It is created by predicting 50 tables a month being sold through two rounds of crowd- funding such as Kickstarter.com and Indiegogo.com. Dealer sales are estimated to be a low 10% of the outstanding tables; after all, dealers will want to grow their levels to rake in more profit (pardon the pun!) With marketing on crowd-funding sites, we will also offer a matching bonus for players up to $200.00. We are anticipating this leads to significant player counts over the next 6 months. The total revenue expected by these players is defined by the current table capacity. In other words, we need to balance the number of players vs. the number of available tables. The projected rake revenue is calculated by taking one third of the table capacity, multiplied by a multiple of 6; which represents the number of players in 12 hours who play for 2 hours. This is essentially twice the table count; once again, a very conservative estimate. Since the first two months are for dealers to get used to their tables, we will let the players play free for the first month, so no revenue will be generated from rakes in the first month of operation. Partnerships We also expect at least two partnerships added per month as we scale up our marketing efforts. A partnership includes 10 Ultimate tables and branding worth $20,000.00. Projected Rake The projected rake revenue going forward is rather difficult to project since we pay out Live Video Dealers Business Plan Page 13
  • 14. Live Video Dealers varying percentages to dealers and their down-levels. 45% of the rake is earned by the top-level dealer, followed 13%, 7% and 5%. Since there will be many more dealers with no down-levels established, earnings estimates are simplified to be 50% of the total rake for that table. A table is expected to be in operation for at least 6 hours per day, dealing only 20 hands per hour and generating $3 in rakes per hand. So the rake revenue calculation is: # of tables * 20 hands per/hour * $3 rake/hand * 6 hours per day Ex.: 1 table times 20 hands/hour times $3 rake/hand = $60 hour/table Or $360.00 for a 6 hour day * 50% commission = $180.00 hour/table after commission Please keep in mind these figures are undeniably low and do not account for the lower stakes hands which require no dealer and earn 100% of the rakes. Partnership tables are expected to be near capacity for 12 hours a day. So the rake calculation is $5 rake/hand times 30 hands/hour or $150 hour/table. Partners get 70% of the rake, so our take is $540.00 for a 12 hour day. Live Video Dealers Business Plan Page 14
  • 15. Live Video Dealers Revenue Projections Base Projection Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Total Revenue $65,000.00 $1,508,750.00 $2,988,500.00 $4,548,200.00 $5,774,050.00 $5,955,550.00 Table Sales $25,000.00 $28,750.00 $32,500.00 $37,000.00 $17,250.00 $18,750.00 Crowd-fund 50 50 50 50 0 0 Dealer Sales 0 5 10 16 23 25 Partnerships $40,000.00 $40,000.00 $40,000.00 $40,000.00 $40,000.00 $40,000.00 Count 2 2 2 2 2 2 Players $0.00 $360,000.00 $756,000.00 $1,231,200.00 $1,396,800.00 $1,576,800.00 Partnership Players $0.00 $1,080,000.00 $2,160,000.00 $3,240,000.00 $4,320,000.00 $4,320,000.00 $5,896,800.00 Expenses Advertising $1,750.00 $1,750.00 $1,750.00 $1,750.00 $0.00 $0.00 Marketing $2,500.00 $2,500.00 $2,500.00 $2,500.00 $2,500.00 $2,500.00 Salaries $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 Table Parts $34,000.00 $35,000.00 $36,000.00 $37,200.00 $28,600.00 $29,000.00 Office Supplies $500.00 $500.00 $500.00 $500.00 $500.00 $500.00 Commissions Table Sales $0.00 $1,250.00 $2,500.00 $4,000.00 $5,750.00 $6,250.00 Table Rakes $0.00 $180,000.00 $378,000.00 $615,600.00 $698,400.00 $788,400.00 Partnership $0.00 $756,000.00 $1,512,000.00 $2,268,000.00 $3,024,000.00 $3,024,000.00 Total P/L $11,250.00 $516,750.00 $1,040,250.00 $1,603,650.00 $1,999,300.00 $2,089,900.00 Annotations: 1 – Crowd-funding initiative ends. 2 – Players are not expected to make an impact until after the first crowd-funding round is over. Players will be allowed to play for free during this period so dealers can get used to the tables and any issues get resolved. Variables: Partnerships per Month 2 Hands per Hour (LVD) 20 Days per Month (LVD) 20 Live Video Dealers Business Plan Page 15
  • 16. Live Video Dealers Hands per Hour (pro) 30 Days per Month (pro) 30 Hours per Day (LVD) 6 Crowd-Fund Table Cost $500.00 Hours per Day (pro) 12 Dealer Sales Price $750.00 Rakes per Hand (LVD) $3.00 Cost for Basic $200.00 Rakes per Hand (pro) $5.00 Cost for Pro $700.00 Percentage (LVD) 50 Cost for Ultimate $1,200.00 Percentage (pro) 70 Partnership Table Cost $1,750.00 Table Commission $250.00 Crowd-fund Table Count 50 The above variables were used in the spreadsheet above to show how very little it takes to earn huge profits. For example, a single table, earning a mere $3 rake per hand, with only 20 hands per hour 6 hours per day and 5 days a week earns $7,200.00 a month. Of course the more players on a table, the higher the rakes will be. Investment Opportunity Currently we are offering a limited time engagement to invest with Live Video Dealers. We will sell 0.2% of our rake profits, before commissions are paid, for each $100K you invest. Rake profits for month 6, representing only 279 regular and 120 partner tables, is $5,896,800.00. Multiplying over 12 months and taking 0.2%, the profit is a whopping $141,523.20! The even better news is that you may invest up to 30% in Live Video Dealers! So a $15M investment now could pay out $21,228,480 every year! And that is only with a fraction of the targeted number of 1000 tables! Major investors will also have a seat on the advisory board which will directly influence the steering committee in regards to corporate direction. We are also interested in going IPO within 3 to 5 years. Amaya Gaming Group bought Pokerstars for $4.9 Billion in cash on June 12, 2014 and was completed August 1, 2014. A similar agreement would net a $15 Million investment almost $1.5 Billion! X. The Future of Live Video Dealers The future is very bright at Live Video Dealers. Through partnerships and dealers all across the globe, we hope to be the preeminent online gaming source. Live Video Dealers Business Plan Page 16
  • 17. Live Video Dealers We already have in the works several hand variations for our core product, the Rapi- Deal® table. The games include Hold’em, Omaha Hi, Omaha Hi-Low, 7-card Stud, 7- card Razz, London Lowball, and follow the queen. These are all hands that are currently served by other online systems. However, since we have real dealers, we also want to introduce hands that require more thought from the dealer. Hands such as 5-card Draw, and even games where players take turns selecting wild cards! With the innovative LED technology indicating to the dealer what to do, this is all easily possible and easily conveyed to the dealer. Live Video Dealers is also seeking to expand the Live Dealer and Players concept into more gaming venues such as Blackjack, Roulette, and Pai Gow Poker. So join us today and reap the benefits of this new and exciting technological breakthrough! Live Video Dealers Business Plan Page 17