Energy Resources. ( B. Pharmacy, 1st Year, Sem-II) Natural Resources
Help4 group box programdecember 16, 2020 version
1. Help4 Group
Box program
December 16, 2020 version 2
Social Business Model Canvas Template
2Anchor Purpose
Help4 Group aims at promoting healthy food at affordable
prices that will allow the households to access quality and
healthy food.
Box A is original grocery box which provides a wider variety of
fruits and veggies with door the door delivery subscription
service.
Box B will ensure that people can cook healthy foods using the
attached recipes and healthy ingredients provided.
Box C: Help4 group provides a grocery box with instruction
books which have fun activities focus on interaction between
children and parentsStakeholders
Clients and customers: families, people living below poverty
line, busy people, and people with disabilities.
Business partners: Vegetable suppliers, logistics companies and
transport services providers
Management and employees of the companyUnique Value
Proposition
Delivering fresh vegetables with high quality original food box
2. door to door to disabled, seniors who are inconvenient to go
shopping in the grocery store
Food box with affordable price provides people who living
below the poverty line or care cost-effective
Working professionals with busy lifestyle could save time by
select Box B with food recipe inside
Parents who lack of way to interact with their children or need
engagement could choose Box C with education instructions
book
Reach
Take advantage of exiting customers
Use of online platforms
Promotion of the Boxes through advertising,
Community Need
More than 150 survey collected.
80% people shows strong interest and would like to try Box A
30% would like to try box B
People would like to try Box C only for free to decide whether
subscribeOutreach Strategy
Through messaging feature in the company's website.
In person intercations through public marketing strategies.
Trial period/ free couponing
Key Activities & Resources
Training the employees on the different categories of the boxes.
Solving customer issues that may arise
Excellent commutation and social skills with famers and
logistics
Rich personal network with local government and VCCosts
Adopt a cost-optimization strategy
Staff salaries and wages
Premises rent
Delivery costs
Cost of acquiring the vegetables and fruits
Printing costs
3. Cost of developing learning materials for box CSustainable
Revenue Streams
Low margin revenue streams from box deliveries
Revenue from Box A
Revenue from Box B
Revenue from Box C
Donation
Sliding ScaleImpact
The intended community benefit of the organization and how it
will measure its outcomes and impact
4. 3
30-WORD DESCRIPTION PLACEHOLDER:
Help4 Group is a social enterprise based in China
with the objective of reducing food wastage and
improving the welfare of children in the poor neighborhood
through
dietary health. Box program aimed to fix the unbalanced
revenue stream
and a new business model to make profits
Get more information at: www.help4group.com
Anchor Purpose
5. 4
Due to the unbalanced revenue stream of Help4 Group (90%
revenue from government purchase) the company will try new
business models to make profits: prmote the sales of fruits and
vegetables categorized in 3 different boxes depending on the
services offered and target market.
Box A: Box A is original grocery box which provides a wider
variety of fruits and veggies at affordable price with door the
door delivery subscription service.
Box B:Help4 group provides a small grocery box at affordable
price along easy-to-follow, well-designed recipe cards for each
meal
Box C: Help4 group provides a grocery box with instruction
books which have fun activities focus on interaction between
children and parents and children
Research shows that grocery box idea is pretty new in China,
only a few companies are developing related products and
services. Many food giants have not yet entered this field yet.
Study shows as China enters aging society in 2020, an
increasing number of people will reduce the number of times to
go out shopping. Seniors expect food to be delivered to their
door rather than directly going to the grocery store to buy it.
It is estimated that in 2025, food box and related delivery
service will account for around 8% of food purchase share.
Market share will increase to 15% in 2030. There is a huge
market gap exist.
DESCRIPTION
LINGERING QUESTIONS
6. RESEARCH
4
What is the market segmentation for the market that Help4
Group serves?
What ensures that Help4 Group continuously serve their target
market of low-income earners?
1
2
3
The underlying motivation and goals for existing
Its larger purpose within the community
4
Community Need
5
7. DESCRIPTION
Help4 group did around 150 surveys during last 5 weeks by
collect data from the local students and parents through sent
survey to existing customers directly, street survey, official
website and promotion of customer feedback platforms to
identify the the needs of the different grocery boxes and areas
that should be corrected and the services that should be
improved.
The company will also liase with the logistics company in
collected of data that will be analyzed to show the areas that
should be improved in the Box Idea.
4
1
2
3
How the organization will determine which needs of the
community are not being met and how it can meet them
RESEARCH
Collecting customer survey and feedback is one of the most
8. effective ways to identify the the customer needs and areas that
need improvement. That is because a business engages with the
customers directly.
According to the survey
80% people (parents)shows strong interest and would like to
try Box A
30% would like to try box B
People would like to try Box C only for free to decide whether
or not subscribe
Help4 Group decide to start with Box A and mainly focus on
Box A in next in the next period of time to see how it goes.
LINGERING QUESTIONS
What is the likelihood that the organization's customers will
provide feedback that will be used in identifying the areas that
should be corrected?
What strategies would Help4 Group implement to ensure that
the organization meets the needs of the community.
Impact
6
DESCRIPTION
People with disabilities, seniors who are inconvenient to go
shopping in the grocery store could get benefits from Help4
Group door to door delivery service.
People who living below the poverty line or care cost-effective
could also get benefits from our good quality food box with
affordable price.
Working professionals with busy lifestyle could save time by
9. select Box B with food recipe inside
Parents who lack of way to interact with their children or need
engagement could get benefits from Box C with education
instructions book
4
1
2
3
The intended community benefit of the organization and how it
measures its outcomes
RESEARCH
Research shows people who subscribe our grocery box could
save around 30% campare with buy food directly from grocery
store.
Study shows there is a huge market gap exist, by 2030, more
people will prefer delivery food boxes to home rather than go to
the grocery store.
Survey shows 75+% current existing customer shows
interest/needs of grocery boxes or have positive attitude on it.
LINGERING QUESTIONS
What are the parties that are involve in the business activities of
10. Help4 Group. What role do they play to the success of the
company?
What parties are affected by the operations of Help4 Group?
Stakeholders
7
DESCRIPTION
The people living below poverty line, the disabled, busy people,
and families that want to experience cooking together are
affected by the organization's outcome.
The organization's partners such as suppliers and logistic
companies are also stakeholders in the organization.
People who are interested in the organization's sucess if the
management of the organization.
4
1
2
3
11. Those who have
a vested interest in organizational success
Those who are affected by organizational outcomes
DESCRIPTION
Help4 Group has partnered with various stakeholders to ensure
that the new business sgemnet is a success. The company will
provide fruits and vegetables in three boxes to its customers and
will implement Box A in the next following weeks
Families that want to experience cooking together can choose
box B which has a recipe.
Children learning materials can be accessed through Box C
LINGERING QUESTIONS
What are the parties involved in the operations of the Help4
Group both at the internal environment and the external
environment? What are their role and contribution toward the
success of the organization?
12. Unique Value Proposition
8
DESCRIPTION
The disabled and the seniors who are inconvenient to shop in
the grocery store can benefit from the door-to-door delivery
service of Help4 Group.
People who live below the poverty line or are care cost-
effective can also benefit from our affordable, high-quality food
boxes.
Working professionals with a busy lifestyle can save time by
choosing box B with food recipes insides.
Parents who lack or need to interact with their children can
benefit from the educational instructions in Box C
4
1
2
3
The value brought
to stakeholders and differentiation from existing options
How the value translates to service offerings and delivery
13. DESCRIPTION
Help4 Group has partnered with different companies in different
lines of services to ensure the success of it new business
segment.
The organization provides the customers with a choice to
choose from Box A, Box B, or Box C.
All the products are of high quality and they are affordable.
LINGERING QUESTIONS
What more value could Help4 Group make beyond mentioned
above
8
Reach
9
DESCRIPTION
The first potential customer of grocery box idea would be local
school ‘s students and families who are currently getting food
from Help4 Group.
Help4 Group can grow its impacts by expanding its reach
through personal network and campaign/promotion activities
which can be achieved through partnership with social
institutions such as denominational centers , governments and
14. community development programs such as youth groups.
Establishing an online platform and social media that allows
public participation on matters related to the development of the
organization can also assist in expanding the reach of the
organization in its core region.
4
1
2
3
How the organization can grow its impact by expanding reach
within its core region
RESEARCH
Promotion activities refers to the activities that aim at
communicating a service or brand to the user with the intention
of introducing the brand or service or induce the buyer in
preference over others.
Use of online platforms as a means of user participation in has
increased its effectiveness with the development of technology
over the years.
LINGERING QUESTIONS
How effective are the methods in promoting the growth of the
15. company's impact?
Outreach Strategy
10
DESCRIPTION
Help4 Group will provide 4 weeks trial periods for free (By
invite only) and 40% Off couponing for all customers in order
to get paying and repeat customers.
Help4 Group will interact with the community through a set of
activities through awareness activities such as direct marketing
publicity where team members from the organization will
interact with the members of the community at the field.
The organization will also interact with the community through
the official website and social media of the organization which
will allow members of the community to ask questions and
officials of the organization will respond them.
4
1
2
3
16. How the organization will interact with the community, build
awareness and achieve initial buy-in
RESEARCH
Help4Group will interview folks in the US doing to learn what
marketing techniques work in other countries in the next
following monthes and adapting them for China.
Various marketing methods may be used by the organization to
reach the community. An example is direct marketing whereby
the marketing agents will interact with people at teh
community. That will increase the community's trust on the new
business segment.
One of the most effective methods of ensuring interaction
through online platforms is by creating a chat program where
enquires are made and responded through the online platform.
The company may also interact with its customers via the wbsite
LINGERING QUESTIONS
What strategy can be used in enhancing an organization’s
website to create interactions between users, customers and the
organization?
Key Talent, Activities & Resources
11
DESCRIPTION
Excellent communication skills and social skills among the
17. members of the organization, farmers and logistics which
include listening and turn-taking, non-verbal communications,
stress management and internal control.
Rich personal relationship with the local government or venture
capital etc.
Team-building skills among all the stakeholders of the
organization particularly those involved in the operations and
delivery of the organization’s products.
4
1
2
3
What talent is needed to realize impact
What key activities and resources are needed to launch and
create value for stakeholders
DESCRIPTION
The organization will partner with its partners to ensure
freshness and high-quality of its produce .
The organization will also train the employees about the new
18. business segment, all the boxes and what they entail. That will
help in promoting quality and effective services and products.
Consequently, any customer cnflicts that may occur will be
solved to ensure that all the customers are satisfied.
LINGERING QUESTIONS
What are the most effective talents required in expanding the
impacts of an organization or box idea?
Costs
12
DESCRIPTION
The organization will implement a cost-optimization strategy.
That will help in the reduction of the costs incurred by the
organization
Some of the costs that will be incurred include
Staff salaries and wages
Premises rent
Delivery costs
Cost of acquiring the vegetables and fruits
Printing costs
Cost of developing learning materials for box C
The participation of many volunteer with no charge has reduced
expenses of Help4 Group in some ways.
The use of logistic companies reduce the cost of warehousing
which is a key cost driver in relation to the operations of the
organization.
19. 4
1
2
3
The key cost drivers for base operations and service delivery
RESEARCH
A cost-optimization strategy promotes cost reduction while
promoting business value (Al Haj & El-Sayegh, 2015).
The costs that the company will incur will cater for the
acquisition of the vegetables and fruits until they are delivered
to the customers.
Help4 Group applies key cost drivers in managing the cost of
operations with the goal of maintaining the affordable prices of
the food products. One of the cost driver used is warehousing
cost minimization through the logistic companies facility
(https://www.help4group.com/).
LINGERING QUESTIONS
What is the most efficient cost driver that the organization can
use in ensuring minimum costs are incurred from the operations
of the organization?
20. 12
Sustainable Revenue Streams
13
DESCRIPTION
Besides government purchase, Help4 Group will use a low
pricing strategy to generate its income by selling different
boxes.
It will receive income from the sales of Box A
It will receive income from the sales of Box B
It will recieve income from the sales of Box C.
Help4 Group ’s website has a three series denomination on the
donations possible: $1, $10 and $100 in which well wishers
select the donation to be made.
4
1
2
3
21. The key revenue streams and mix of revenue sources required
for long-term sustainability
DESCRIPTION
Sliding scale related research will be the on the top list next
stage
Since the new business segment targets the low-income earners
and the busy people, a low pricing strategy will ensure that the
organizations gains a bigger market share in the market
The organization will also receive more income as it will sell
different boxes to different customers
Help4 Group are cooperating with serval companies to develop
grocery boxes.
LINGERING QUESTIONS
Is there any other good way to generate revenue beyond what
mentioned above?
Reference
https://www.help4group.com/
Al Haj, R. A., & El-Sayegh, S. M. (2015). Time–cost
optimization model considering float-consumption impact.
Journal of Construction Engineering and Management, 141(5),
04015001.
Mothersbaugh, D. L., Hawkin, D. I., & Kleiser, S. B. (2019).
Consumer behavior: Building marketing strategy. McGraw -Hill
Higher Education.
Chinese business journal 中国商业周刊人口老龄化趋势
22. 14
BIO/URE 3450
DINOSAURS VIDEO LAB
Write a short paper (2-3 typewritten pages or less) analyzing the
video shown in today's lab. In your paper, indicate:
1. The intended audience and explain your reasoning using
specificexamples from the video;
2. What environmental/ecological principles were discussed,
shown,
described or mentioned (no matter how briefly);
3. What was the primary environmental focus of this video;
explain
your reasoning using specificexamples from the video;
4. How successful was the video at getting its primary message
across to its intended audience; explain
your reasoning;
5. Give a grade to this video from the PERSPECTIVES (a-f) of:
a) a parent
b) an educated adult
23. c) an environmentalist
d) a politician
e) a business person
(NOTE: A LETTER GRADE MUST BE GIVEN FOR ALL
PERSPECTIVES LISTED.
NO EXPLANATION FOR THE GRADE IS NEEDED HERE;
SEE #6.)
6. Choose ONE PERSPECTIVE from #5 and COMPLETELY
EXPLAIN the reasoning behind your grade. Use SPECIFIC
EXAMPLES from the video to justify the grade you gave that
perspective.
7. This is a serious writing assignment. You will be graded on
your grammar, punctuation, and writing
quality.
Each category (1-7) is worth a MAXIMUM of 5 points. Thus
your score is
based on a maximumtotal of 35 points. PAPER IS DUE ON OR
BEFORE February 25, 2021
8.1 Financial Overview a) Business Model Description
Moving Beyond Depression is a set of protocols to train and
guide the work of therapists and home visitors in the in-home
treatment for mothers who are identified with clinical
depression. This successful home visiting model was borne out
of the research of two prominent doctors who will participate in
24. the Affiliate implementations.
In addition, the efficacy of the intervention has been validated
in three independent Affiliates. Therapists, a Business Manager,
a Program Manager and a Research Coordinator will also
participate in Affiliate implementations.
The pricing of the product will be directly related to the amount
of time required of personnel for each phase of the program per
unit. [A unit is defined as the full product lifecycle for up to
four therapists. An Affiliate with more than four therapists
engaged in the program will require multiple units.] The
product price will be determined by the following:
· Direct personnel time required per unit
· Indirect personnel time required per unit
· Travel Expenses per unit
· Profit Margin per unit
Due to the nature of the product, a training and support
program, the majority of the venture’s expenses are attributed to
the cost of personnel. Year over year, personnel expenses will
comprise an average of 77 percent of total venture expenses for
the first five years.
b) Financial Targets
The two core underlying financial targets for Moving Beyond
Depression are the following:
1. Reach self-sustainability after year 2
2. Generate a sustainable annual profit margin of 15-20 percent
to be used to fund expansion of the parent program as well as
additional research and continued investment in the Moving
Beyond Depression venture.
Based on the assumptions stated in section 8.2,the revenue,
expenses and profit margin for the first five years of the venture
are noted below.
· Moving Beyond Depression will be profitable Years 3-5
· The cost of sales as a percentage of revenue will average 89%
during Years 3-5
25. Year 1
Year 2
Year 3
Year 4
Year 5
# of Units*
3
6
7
8
9
Revenue
$779,755
$725,675
$707,441
$860,452
$1,007,334
Expenses
$777,320
$668,036
$690,171
$705,065
$868,645
Net Income
$2,435
$57,639
$17,271
$155,387
$138,688
Profit Margin
0%
8%
2%
18%
14%
26. Revenue Growth
175%
47%
22%
17%
Cost of Sales
100%
92%
98%
82%
86%
Cumulative Cash Flow
$2,435
$60,074
$77,345
$232,732
$371,420
Debt Ratio
1.00
0.69
0.98
0.82
0.86
Current Ratio
1.00
1.45
1.03
1.22
1.16
*A ‘unit’ comprises four therapists. A single Affiliate may have
multiple units depending on the number of therapists to be
trained.
*$605,000 of the revenue of $774,755 for year 1 and $245,000
of the revenue of $730,765 for year 2 can be attributed to the
assumption of the receipt of a start- up grant.8.2 Key
27. Assumptions
The revenue targets noted in Section 8.1 are predicated on the
following assumptions: a) Start-up Funds
Moving Beyond Depression will receive a grant for
$850,000 to cover startup expenses and a portion of operating
expenses during Year 1 and Year 2. This total is composed of
the following:
Year 1 Expenses
System Development Costs:
· Portal Development - $100,000
· Website Development - $35,000
· CRM implementation - $20,000
$156,000
Licenses - $1,000
Personnel
$409,940*
Government Relations Specialist
$100,000
Facility
$60,600
Marketing
$20,000
General Administrative Costs
$15,780
Legal Costs
$5,000
Advisory Council Meetings
$10,000
*Personnel expenses include base salary, benefits, taxes and
expenses. b) Program Price
· The table below displays the components of the program price
of $98,478.
28. · The program price for affiliates with less than four therapists
will be $70,342.
· The program price for affiliates with greater than four
therapists will be $98,478 plus $24,620 for each additional
therapist.
· The price for additional training services will be determined
by multiplying a fullyloaded hourly rate for the staff member
performing the work by the estimated time required of the
service.
Components of the Average Program Price per Unit
Average Direct Personnel Cost to MBD
$ 52,493
Indirect Personnel Costs (10 percent)
$ 5,249
Travel Expenses: Phase I
$ 3,200
Travel Expenses: Phase III
$ 6,400
Expenses
$ 3,000
Total
$ 70,342
Mark up
40%
Program Price
$ 98,478
Number of Therapists per Unit
4
Average Price Per Therapist
$ 24,620
Average Cost Per Therapist
$ 17,585
c) Year 1 Personnel
· Only personnel critical to the launch of the venture are
employed in Year 1.
29. · The table below denotes which personnel are critical Year 1:
Title
Name
Capacity
Program Director
Robert T. Ammerman, Ph.D.
50%
Research Director
Frank W. Putnam, M.D.
10%
Program Manager
Future Hire
100%
Business Manager
Glenn T. Flick
50%
Therapist 1
Future Hire
50%
Research Coordinator
Future Hire
50%
Sr. Administrative Assistant
Jennifer L. Diers
25%
d) Resource Capacity
MBD has modeled the capacity needed with growth –
it is available upon request. e) Incremental Personnel
Additional personnel will be hired on an incremental basis
according to what the growth in units demands. f) Program
Growth
The revenue estimates are based on conservative growth
projections. The first year target is three new units. Through
word of mouth, marketing efforts and lobbying efforts, the
second year target is six new units. Incremental growth is
30. targeted for years 3 through 5, with seven new units targeted for
year 3, eight new units for year 4 and nine new units for year 5.
g) Annuity Revenue (Year 3 and Beyond)
65 percent of Affiliates will subscribe to an annual
organizational MBD
Membership Program for $5000/year which will consist of the
following:
· Access to MBD Portal o Discounts on additional Training o
Research Updates o Therapist Newsletter
· Discounts and early access to new MBD products
h) Personnel Expenses
· The table below displays the base salary, benefit amount and
total salary for each of the personnel in the venture.
Title
Base Salary
Benefits (28%)
Total Salary
Program Director
$ 181,250
$ 50,750
$ 232,000
Research Director
$ 243,750
$ 68,250
$ 312,000
Doctor 3
$ 101,563
$ 28,438
$ 130,000
Program Manager
$ 84,500
$ 23,660
$ 108,160
Business Manager
$ 84,500
$ 23,660
31. $ 108,160
Therapist 1
$ 50,000
$ 14,000
$ 64,000
Therapist 2
$ 50,000
$ 14,000
$ 64,000
Research Coordinator
$ 67,969
$ 19,031
$ 87,000
Administrative Assistant
$ 31,250
$ 8,750
$ 40,000
Government Relations
Specialist
$ 100,000
$ 0
$ 100,000
· MBD Personnel will receive an annual base salary raise of 3
percent
i) Facilities
Facility expenses have been estimated based on the market
value of an office space that can accommodate 15-20 personnel.
The Facility expense of $60,600 for year one is comprised of
the following monthly costs:
· Rent: $2,500
· Utilities, Internet, and Phone: $850 o Insurance: $200 o
Building Expenses: $1,500 8.4 Projected Financials
8.4.1 Income Statement
· Summary of Projected Net Income: Our revenue projections
for the five-year plan include revenue increases every year
32. (excluding the grant) based on the growth in the number of
units.
· 59 percent of the program price of $98,478 is allocated to the
first year of the program (Current Revenue) and 41 percent is
allocated to the second year of the program (Deferred Revenue)
to account for revenue that has been received but not yet
earned.
Year 1
Year 2Year 3Year 4Year 5
Revenues
Current Revenue
$174,755
$359,995 $432,594 $509,225 $590,064
Deferred Revenue
$ -
$ 120,681 $ 248,602 $ 298,737 $ 351,656
Membership-based fees
$ -
$ - $ 10,000 $ 20,000 $ 25,000
Additional Training
Grants
TOTAL REVENUES
$ -
$605,000
$ 16,245 $ 32,491 $ 40,614
$245,000 $0
$0 $0
$779,755
$725,675 $707,441
$860,452 $1,007,334
41. Mission
AppSuccess provides low-income students who are qualified to
go to a four-year college with the means to get there. We
eliminate the college application information gap by matching
our Applicants with students from top colleges who guide them
through the college application and financial aid process via our
interactive online platform.
Theory of Change
If we provide low-income students with personalized college
application assistance, then they will get into better colleges
and have improved life options and opportunities.
Value Proposition
Our product creates value both to the Applicant and to society.
Value for Applicant
AppSuccess’s primary value proposition is to reduce the cost of
achieving education to the Applicant. We do this in three ways:
(1) Reducing information costs: By making information that is
relevant for college applications free and accessible for all high
school students, AppSuccess allows both students and their
parents to learn about the details of applying to, attending, and
paying for college;
(2) Reducing application support costs: By providing low -
income students with free college counseling services,
AppSuccess gives them an opportunity to compete with their
high-income peers who often have adult support and assistance
with their applications; and
(3) Reducing dollar costs: By assisting Applicants to identify
and apply for college fee waivers, scholarships, and grants,
AppSuccess works to save each Applicant hundreds, if not
thousands, of dollars to make college affordable.
In addition, because the end goal of AppSuccess is to get its
Applicants into college, we offer our “customers” the added
value that comes with a post-secondary education. Studies over
the last decade have confirmed that college graduates reap
significant benefits over those that stop at high school (College
Board). Compared to high school graduates, college graduates:
42. · Earn nearly $1 million more over a lifetime;
· Have half the unemployment rate;
· Have one-third the incarceration rate;
· Require $800-$2,700 less in social programs each year; and
· Have more educated children.
Value for Society
The financial return to society for a program like AppSuccess is
substantial. Not only does it provide intangible benefits to the
Applicant in the form of increased exposure to diversity of
ideas and cultures, but also to society in the form of economic
benefit. A first-pass analysis suggests that the net present return
on investment in an AppSuccess Applicant is over $45,000, the
bulk of which is derived from the increased income open to
college graduates and graduates of higher tier institutions. We
expect this sort of return to attract strong foundation
investment, especially after proof-of-concept.
FINANCIAL PLANFinancial OverviewBusiness Model
Description & Financial Targets
Our model projects that we will be cash-flow positive by our
third year of operation. Our expenses will be driven mainly by
web-development and personnel costs, and will gradually grow
from $325,000 in year one to $650,000 in year six, as we double
our headcount to accommodate increased web traffic and
recruitment efforts. We will be financed mainly by grants and
individual donations, and will slowly introduce additional
revenue streams including advertising and corporate
partnerships.
There are two key financial criteria to our mission: (1) that the
application assistance always be provided free of charge to the
Applicants, and (2) that we have a financially sustainable
organization by year three of operation. Our projections achieve
both of these goals (see Appendix).
Key AssumptionsStart-Up & Growth Expectations
AppSuccess will roll out in four Stages:
Stage 1 (estimated time: 1 year). We will launch the program
43. with 90 Applicants and 90 Mentors. We will recruit Campus
Leaders from three colleges—Harvard University, Washington
University in St. Louis, and the University of California,
Berkeley. The Campus Leaders will be in charge of finding 25-
35 Mentors in their school. Mentors will be trained using a
curriculum designed specifically to assist the Applicants in the
application process. We will partner with a handful of high
schools to recruit our first 90 Applicants. Applicants and
Mentors will interact using the web-based platform, with a
back-end that will allow us to monitor the progress of each
Applicant. Throughout Stage 1, we will solicit feedback from
all 90 Mentors and Applicants on a bi-weekly basis to make
continual improvements to the program based on real-time
feedback.
Stage 2 (estimated time: 1 year). We will expand the program to
440 Applicants and 430 Mentors from ten universities. This
Stage will require us to find new Campus Leaders, who will
drive the increased requirement for Mentors. The website and
curriculum will be adjusted and improved in response to
feedback gathered in Stage 1.
Stage 3 (estimated time: 2-3 years). We will continue to grow,
accepting many more Mentors and Applicants. This Stage will
require significantly more resources to support nationwide
recruiting. We will need to hire staff to manage the Campus
Leaders and the Applicant/Mentor pairs, and ensure that each is
fulfilling their obligations.
Stage 4 (estimated time: 2-3 years). We will scale further by
creating compatible programs for high school juniors,
sophomores, and freshmen, focusing more on college
preparation (e.g., taking rigorous classes, participating in
extracurricular activities, studying for the SAT and ACT). This
will require significant curriculum development, with specific
benchmarks and a different set of guidelines for each school
year program.Sources of Revenue
Total revenues will grow from a base of approximately
44. $210,000 to over $940,000 by year six of operation. These gains
are a direct benefit of the continued support of our donors and
partners, as well as advertising related to the growth of our
business. Details by line item as follows:
Grants. Foundations provide a large source of funding to
education-related nonprofits: four of the top 10 foundations in
the US support education. Many other foundations, like the Citi
Foundation and the Lumina Foundation, target funds
specifically at activities that promote college access among
disadvantaged populations. Grants will be a significant source
of funding for AppSuccess in our early years, and as we grow
we will rely on them increasingly less. In our first year we
expect grants to make up 95% of our revenue. By our sixth year
of operation we will have reduced our dependence on grants
significantly, down to 30% of our revenue. As we continue to
build a reputation and a corps of committed financial supporters
we expect annual donations to make up an increasingly larger
percentage of our revenue stream. Therefore, we plan to apply
initially for grants for seed funding from foundations like the
Darden Foundation, whose Recipe for Success program offers
seed funding to organizations that “impact the educational
prospects of underserved youth, ages 14 to 18, by providing
them with access to the information and tolls they need to
pursue their dreams of higher education.”
Partnership Revenue. AppSuccess will partner with
organizations like CollegeBoard, ACT Inc., Princeton Review,
Embark, CommonApp, FastWeb, and other organizations geared
toward getting students into college. Our goal is to build
relationships and eventually point our students toward their
websites.
Donations. We will raise donations primarily through our
"Sponsor an Applicant" program. The program enables donors
to finance all of AppSuccess's costs associated with supporting
an Applicant for $100 per Applicant. To get long-term buy-in
from donors, we will require Applicants to write letters of
appreciation to their sponsors. Similar sponsorship programs
45. have proven extremely effective for other organizations because
it puts human faces to the donation.
Advertising Revenue. Different from our partnerships, our
advertisers will be consumer product companies and related
companies that market to young adults. Revenue calculations
are based on a standard ‘click through’ model. We assume our
advertisers will pay us an average click through rate of $0.65,
and that our Applicants will click an average of 3 times per
month.
Costs and Expenses
Our largest expense is personnel, with salaries and benefits
estimated to be around $560,000 during the first two years
alone. Note that throughout the six-year projection more than
80% of our expenses are related to personnel, as the
hardware/storage, real estate, and miscellaneous costs are
minimal.
Net Surplus and Break-Even
Despite a minimal loss in years one and two (that could be
financed by guaranteed loans), we will be fiscally sound and
self-sustaining thereafter (see Below).
Financial Projections
Revenues Expenses Surplus
$1,000
$900
$800
$700
$600
$500
$400
$300
$200
$100
47. mid-November to early February, thus highest activity levels on
our site will be in the first and second fiscal quarters, with web
design, advertising and promotion and travel expenses weighted
toward the first half of the fiscal year (see Appendix).
Revenues are budgeted to be spread evenly over the fiscal
quarters, with the first quarter of 2012 getting a boost from the
$25,000 prize related to the HBS Business Plan Competition.
Statement of Cash Flow
Our cash flow statement resembles our projected income
statement. This is both due to our nonprofit status (we do not
pay any taxes and therefore expense all our software
development costs as incurred) and due to the web-based nature
of our business, meaning that there are few fixed assets that
need to be depreciated. On an annual basis, all our revenues and
expenses are received and paid for in cash.
In the first two years of operation we are projected to lose
approximately $187,000. This will be financed by debt, raised
in advance of incurring the losses and projected to cost
approximately 4% on an annual basis (see Appendix).
Note that we will begin to earn a surplus and generate cash in
the third year of operation. Any excess cash generated will be
used to repay debt.
Sustainability
Sustainability is a serious concern for any enterprise, and
especially for those in the not-for-profit realm. Through
conservative planning, leveraging our partner relationships and
exploiting revenue streams collateral to our core business, we
hope to ensure this sustainability for AppSuccess. Our financial
projections show that we will be cash flow positive by year
three of operation. Yet we recognize that without charging for
48. our services, we are dependent on the funding from individual
donors and foundations to be sustainable. We plan to address
this challenge in several ways.
Keeping Operating Costs Low
Aside from the handful of staff we need to run the business and
develop the website, our operating costs are extremely low,
which allows us to focus less of our time on fundraising and
more of our time on creating a better product.
Keeping Fundraising Goals Conservative
Our financial projections show that we only need to raise about
$200,000 in grants each year to be sustainable. We believe that
this is a conservative estimate, since funding for education
nonprofits exceed over $5.5 billion annually in the US alone.
Importantly, the economic hardships did not affect funding for
education.
Developing Other Potential Sources of Revenue
The very nature of our web-based platform lends itself to two
potential sources of revenue in the future:
· Data sales: By year six, we will have worked with over 16,500
Applicants and completed tens of thousands of college
applications. Using the lessons learned and the data
accumulated from these applications, we could compile this
information into a workable format to make available to high
schools for a fee. Schools, both Title 1 and others, could use
this data to help them inform their college counseling, as well
as distributing the material to students. Ours would be a classic
razor-razor blade model. Due to our technology focus, data
accumulation and customization costs would be modest. We
could give away the initial data package for free and then
charge increasing amounts per school per year for updates.
Longer term, we hope to be working with hundreds of Title I
high schools (not to mention the thousands of overall high
schools in the US), and charging several thousands of dollars
annually for updates – this could be a dramatic addition to our
revenue model.
· Source code sales: Our operational success will be closely tied
49. to the robustness of our web-based platform. The source code
that we will develop, which will allow for complex and multi-
faceted interactions to take place remotely, could be sold to
other non- competing companies. This could include any multi-
person, multi-location operation, including SAT preparation,
general tutoring, consulting, medical services, etc.
Key Data
AppSuccess
2012-2017
GROWTH STRATEGY
2012
2013
2014
2015
2016
2017
MENTORS
# Campuses
3
10
25
50
100
100
# Mentors
90
