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![Willingness to Pay14
Summary Target Market Strategy Financials Next Steps
▹$520 – Vehicle Use
▹$290 – Time Value [1]
▹$190 – Wear and Tear [2]
▹$200 – Parking
▹$150 – Gas
$1,350
Source: Journal of Public Economics, AAA](https://image.slidesharecdn.com/simonturbochargers-carnegiemellon-190330213301/85/Tepper-Tech-Innovation-Case-Competition-14-320.jpg)
Tepper Tech Innovation - Case Competition
- 1. SAEV MobilityTIC CaseCompetition – November 18, 2017
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- 5. Agenda 1. Executive Summary Situation Solution 2.Target Market 3. Strategy 4. Financials 5. Next Steps Risks Implementation 5 Summary Target Market Strategy Financials Next Steps
- 6. $300 BillionAnnual Commutingloss 77% of emissions are commuting Source: Inrix Research Reports, Environmental Protection Agency
- 7. $50-250M per mile USPublic Transit Infrastructure Costs* *Buses $13.5M Source: Environmental Protection Agency
- 8. $500B Parking$73B Wastedlooking for parking Source: Inrix Research, Victoria Transport Policy Institute
- 9. $212B AnnuallyAmount RoadCrashes cost US Autonomous Vehicles could reduce by 90% Source: McKinsey
- 10. Our Solution Summary TargetMarket Strategy Financials Next Steps
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- 12. Target Customer Market12 SummaryTarget Market Strategy Financials Next Steps Annual Income greater than $100,000 Professional working adult between the ages of 25-54 Lives in suburb of major city with long commute
- 13. Target Market 13 Summary TargetMarket Strategy Financials Next Steps 1 6 2 9 3 4 5 7 8 10 City Peak Hours in Congestion Cost of Traffic Los Angeles, CA 104 $9.7 billion New York, NY 89 $16.9 billion San Francisco, CA 83 $2.5 billion Atlanta, GA 71 $3.1 billion Miami, FL 65 $3.6 billion Washington, DC 61 $3.0 billion Dallas, TX 59 $2.9 billion Boston, MA 58 $2.9 billion Chicago, IL 57 $5.2 billion Seattle, WA 55 $2.0 billion Source: Inrix Research
- 14. Willingness to Pay14 SummaryTarget Market Strategy Financials Next Steps ▹$520 – Vehicle Use ▹$290 – Time Value [1] ▹$190 – Wear and Tear [2] ▹$200 – Parking ▹$150 – Gas $1,350 Source: Journal of Public Economics, AAA
- 15. Pricing Tier 1 -Base - $1,000 ● Daily pickup and drop-off between home and work Tier 2 - Plus- $ 1,350 ● All Base Services ● 10 custom changes ● Enhanced Privacy ● Customized desk locations 15 Summary Target Market Strategy Financials Next Steps
- 16. Entry Market –Los Angeles 16 Summary Target Market Strategy Financials Next Steps Neighborhood Rush Hour Commute (Minutes) Bel-Air 62 Hidden Hills 80 Rolling Hills 60 Beverly Crest 72 Pacific Palisades 61 Palos Verdes Estates 72 San Marino 40 La Canada Flintridge 31 Malibu 75 La Habra Heights 75 Manhattan Beach 71 Rancho Palos Verdes 78 Westlake Village 94 Calabasas 86Source: Google Map Data
- 17. Entry Market –Manhattan Beach 17 Summary Target Market Strategy Financials Next Steps 60% of households w/income > $100,000 51% between the ages of 25-54 71minute rush-hour commute 28% commute downtown to LA for work Total (MB) Market Size = $35 million Source: Movoto
- 18. Marketing Strategy Partnerships Starbucks Fitbit Digital Marketing CreatingMemorable Experience 18 Summary Target Market Strategy Financials Next Steps
- 19. Marketing Strategy -Partnerships Starbucks Customer Profile Educated, 42 years old Average Income $90,000 19 Summary Target Market Strategy Financials Next Steps Similar Targeted Customer Segment Source: The Advertising Research Foundation US Wearable Customer Profile 36% are 35-54 years old 41% average income $100,000+
- 20. Marketing Strategy -Implementation Starbucks Partnership - In store advertisement - Starbucks coffee in SAEV - Promotional offers 20 Summary Target Market Strategy Financials Next Steps Fitbit Partnership - Push notifications - Community health events - Rewards on steps
- 21. Differentiators Productivity Community Personalization 21 Summary Target MarketStrategy Financials Next Steps
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- 23. SAEV CommunityNetwork withlike-minded professionals
- 24. PersonalizationFacial recognition andcustomized interactions
- 25. Financial Model –Key Assumptions25 Summary Target Market Strategy Financials Next Steps Criteria Background SAEV price $100k Parity reached with electric and gasoline Average 25’ Bus cost: $60k Seats per SAEV 14 25’ Bus, 3x4.5 area Weighted Average Price, Tier 1 and Tier 2 $1,210 Monthly Price, Assumed 40% Tier 1, 60% Tier 2 WACC 6.9% Similar to Tesla See Appendix for Financial Model Source: Tesla, Starcraft Buses
- 26. Financial Model –5 Year Net Present Value and Revenue26 Summary Target Market Strategy Financials Next Steps $16M NPV $700k Revenue – Year 1 15% Operating Margin – Year 1 $140M Revenue – Year 5 30% Operating Margin – Year 5 5, $138,280,098 $- $20,000,000 $40,000,000 $60,000,000 $80,000,000 $100,000,000 $120,000,000 $140,000,000 $160,000,000 $180,000,000 $200,000,000 0 1 2 3 4 5 6 Year Revenue Growth
- 27. Key Performance Metrics MarketingMetrics ● Cost of Customer Acquisition (CAC) ● Customer Lifetime Value (LTV) ● Organic Growth Service Metrics ● Wait Time and Cancelled Trips ● Customer Rating ● Customer Travel Time 27 Summary Target Market Strategy Financials Next Steps Performance Metrics ● Percentage of Seats Filled ● Vehicle Miles Travelled ● Number of App downloads
- 28. Key Performance Metrics28 SummaryTarget Market Strategy Financials Next Steps Criteria Measurement CAC LTV CAC = 1/3 LTV Tracked on backend Wait Time Cancelled Trips <10 min Collected via app Customer Rating 4.5+ Collected via app Percentage of Seats Filled 80% Collected via SAEV Source: Lyft, CAC from Starbucks
- 29. External Implementation29 Summary TargetMarket Strategy Financials Next Steps Year 1 Year 2 Year 3 Year 4 Year 5 Manhattan Beach 100 SAEVs 350 SAEVs All of Los Angeles Washington, D.C. Boston and Chicago Full scale 25 SAEVs Fleet 200 SAEVs 500 SAEVs
- 30. Internal Implementation30 Summary TargetMarket Strategy Financials Next Steps Year 1 Year 2 Year 3 Year 4 Year 5 Direct Marketing 30 employees 40 employees Partnerships - Starbucks & Fitbit Grow SAEV community Exit IPO, M&A 10 employees 35 employees 45 employees
- 31. Risks31 Summary Target MarketStrategy Financials Next Steps Supplier Relationships Phenomenal Design Regulatory Landscape Source: McKinsey
- 32. Solution32 Summary Target MarketStrategy Financials Next Steps “SAEV Mobility: Putting WeWork in an Uber for your daily commute.” -SAEV Mobility Co-Founders
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- 36. TABLES: Financial Assumptionsand Revenue Growth36
- 37. TABLES: Financial Costof Goods Sold37
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- 39. Marketing Metrics:39 Marketing Metrics Measurement MethodCriteria Future Incorporation Cost of Customer Acquisition (CAC) CAC = Total cost of sales & marketing/# of new customers Track CAC through different marketing channels CAC<LTV Focus on marketing channels with higher CAC Boost referral system Constant innovation using pareto principle Customer Lifetime Value (LTV) The life span of customer Customer retention rate Profit margin per customer The rate of discount LTV>CAC Going forward, CAC=LTV/3 Choose customer segment to invest in to increase future profitability Increase LTC increasing customer satisfaction rating Organic Growth Subscriptions Trips per month 10% market share in first 3 months Boost marketing efforts and increase CAC in attractive segments
- 40. Service Metrics:40 Service MetricsMeasurement Method Criteria Future Incorporation Wait Time and number of cancelled trips Track the time people need to wait for vehicles to arrive Cancellation rate after viewing wait time Less than 10 minutes for the 1 st six months Roll out more SAEVs Improve platform algorithm Decrease wait time to 5 minutes after six months Customer Rating Customer rating after every trip Greater than 4.5 Take actions based on customer recommendations Build transparency and strong support system Customer travel time Compare each trip with regular travel time for A to B Within 10% of average travel time Improve customer pick-up and drop-off process
- 41. Performance Metrics:41 Performance Metrics Measurement MethodCriteria Future Incorporation Percentage of seats filled Data from SAEV 80% seats filled for every trip Increase customer base in specific locations Vehicle Miles Travelled Milage data from SAEV Optimize through every trip (avoid unnecessary travel paths Utilize this data for future efficiency Number of App Downloads Track the growth and usage Organic plus referral growth Increase sales funnel