Company OverviewCompany Overview

After [x] years in [field or industry], and [x] years as [an avid] [area of interest—skier / needleworker / programmer / web designer…], [Owner/Founder] [was working in xxx / took a new position doing xxx] where [he / she] found that there was a critical need for [product or service]. Thinking that there must be other [type of enthusiasts / people working with or wanting to obtain or utilize xxx], [he / she] began looking for online resources to meet this need. Having found a [club / user group / society / association] online, [Founder first name] began [participating with the group / contacting people to find out what they did to satisfy their need for xxx]. They were all [frustrated with the lack of resources / unhappy with current suppliers / unwilling to use unsecured sites, etc] to support [area of interest]. In [less than x months / a matter of months / the next year] [Founder 1 first name] met [Founder 2], and began to formulate a plan to meet the growing demand for [product or service].

In [year started], [Company Legal Name] secured the proper licensing and began the process of planning the new business. [Company] [is now ready to launch / launched] its initial website serving the [high-end / low-price / local / neglected] market for [what you sell.] Located at [website], this [online store / online service / Intranet service / information service / web hosting service / interactive educational presentation service] will serve the needs of [define your market segment], and provide all the conveniences of instant online availability.

With [no / few / inadequate] providers available to meet the needs of [the market you will serve], [Company] is poised to take a front-runner position in this market, with room to expand as the business grows to profitability. Recent growth in the [market / business environment / economic environment] is creating a steadily increasing demand for [name your type of products] that [describe applications for your product(s)]. We are excited to have this opportunity to apply our [industry / business / hobby / avocational…] interests and experience to meet a need we had experienced ourselves. At the same time, we step out of the corporate environment into a growing, high-margin business that allows us to work in the area of our greatest [interest / passion / skills].

Revenue ModelRevenue Model

As an eCommerce business, [Company] is acutely aware of public perception regarding Internet-based businesses. These businesses have taken a beating recently—in the overall economy, as well as in the

media. Countless venture-funded “dot-coms” have become “dot-bombs,” leaving many wondering what happened. Unfortunately, many of these business failures can be attributed to the underlying premise that the Internet would generate huge revenues because there are so many millions of people using it. Somehow, in all the excitement, the “how we’ll make money” part of the equation was frequently overlooked.

[Company] understands that growing a viable business requires that you sell something people want to buy—something that they will buy. What you sell must meet a real need of some sort. The need can be financial, physical, mental, emotional—and logical or illogical, it must be felt strongly enough to motivate the prospective customer to take out a credit card.

Beginning with a genuine need we encountered ourselves, [Company] has successfully avoided the “technology for technology’s sake” syndrome, and developed a technology designed to meet the need we had identified.

Our revenue model is based on several revenue streams:

[Business / Gaming / Educational] customers [need / want] [what you offer], and are willing to pay a [nominal fee / reasonable fee / premium] for [online availability / online ordering / download capability / instant updates, etc.]

Our [data-gathering / online storage / targeted search / online database / online collaboration, etc.] service(s) appeals to [your market] customers, who readily pay $xxx for their [weekly / monthly / annual / 3-month / 6-month] subscriptions to the service.

Annual membership fees for our [your market] community provide customers with [chat / expert advice / bulletin board / auction / product, information and people search] functions specific to the [your market] [business / industry / user group, etc.].

By participating in Affiliate Programs with our online co-marketing partners, we generate additional revenues with no out-of-pocket costs, and gain the added benefit of increased visibility with partner-site visitors.

Based on our research and ongoing study of our market and our customers, we have determined that we can successfully generate at least $xxx annually from these revenue sources, exclusive of Affiliate Program revenues, which we drive back into covering the costs of our own Affiliate Program.

Market OverviewMarket Overview

For the past [x] years, the online [your product or service] market has seen [slow / moderate / rapid / exceptional] growth, due in part to [the lack of suitable technology / inability to keep pace with evolving technologies / exponential growth in Internet use / widening acceptance of online xxx… list market drivers].

Worldwide sales of [product or service] now exceed $[xxx] [million / billion] annually. With projections setting [xx]% growth by [20xx] the national market is expected to reach $[xxx] million in the next [quarter / year / two years…], with potential expansion to the international arena within [xx] years. Since the nature of this business drives sales through our online presence, we stand to experience significant growth both in [units / service volume] sold and revenues generated as Internet usage increases. Online sales of our [product / service] pose [little / no / marginal / major] threat to [local retailers / other online services / businesses generally], and form the foundation of our business.

The majority of [your market] customers prefer [online interaction to every other option / the collaborative aspects / the “connectedeness” / immediate purchase and delivery / online assistance / the seductive pricing] available only through an online provider. Our services provide significant convenience factors for our customers through their Internet connections, using familiar functionality and a totally user-friendly interface, to easily accomplish the daunting tasks of [whatever it is you provide]. Our technology provides [special capabilities of your service] with security and peace of mind for [business customers / cautious consumers] in particular. [Business customers / Consumers] get the best of both worlds. And so do we.

Current sales trends in the [related xxx / xxx-dependent] market bode well for [Company], as [related xxx / xxx-dependent] market sales typically [drive / influence] our sales. Growth in the two markets have kept pace consistently for the past xxx [weeks / months / quarters / years / decade]. Recent [rapid / moderate / slow] growth due to [note current changes influencing growth patterns] should help us [achieve stated goals / make the transition from xxx to xxx / support the development of xxx / allow for restructuring of xxx]. With [x]% growth in [related industry], we fully anticipate revenue from our own growth to exceed [related industry] growth by [20xx].

Market StrategyMarket Strategy

The idea for this business grew out of [our own dissatisfaction with available resources / requests from customers in our xxx business / excessive service calls to one of our vendors / a sharp drop in our retail sales with significant increase in our online sales / a client-funded request / an inadvertent discovery, etc.]. [Company] offers customers advantages that appealed first to us for a variety of reasons, then to those we interviewed in our research. In the [business / consumer] market we serve, we will be meeting a very real

need. First, we will be the only online providers offering [products or services you offer] in the Internet environment.

The nearest competitor, [Competitor 1], provides only [describe what they provide]. Second, we have developed a unique approach to this business, designed to satisfy our own wishes as customers, and evolved to address other issues raised by [customers / prospective customers]. We also provide [exclusive, value-added service / a highly-effective customer loyalty program / customer referral credits / personal instruction / training / installation…whatever sets you apart]. To date, we [have / have not] encountered [only xx / any other] [product or service] provider offering similar added value. [Company] fully intends to establish itself as the source of choice for [product or service] in the [your market] market.

We have planned a carefully focused, targeted media blitz surrounding our [new site launch / new technology introduction / service expansion / the addition of xxx services for xxx customers]. Working with a consortium of businesses in [the xxx services market / online sales of xxx / xxx-related markets] and a local advertising firm, we have planned a campaign to create high levels of visibility, and will announce our [initial media event], then follow up with scheduled promotions to continue the momentum into [20xx]. Working with [PR Firm or Consultant name], we have developed press releases and ads that will display [on municipal transit vehicles (buses—sides and rear, overheads on the train, etc.) / billboards along major arteries in metropolitan areas / bus stop transparencies / in magazine CD inserts / in airline inflight magazines / in industry and trade publications].

We plan to add momentum with radio spots and xxx. We anticipate local and national TV coverage at our press conference. The nature of our [product or services] line also lends itself nicely to [logical tie-in promotions with xxx / strategic alliances to cross-promote related industries / high-visibility promotion in xxx].

LocationWhile gathering our research with [xxx—type of business] businesses nationwide, we discovered that [note special customer requirements], and that an easy way to address this issue was locating our facilities and sales staff in [technology centers / major cities / outlying areas / the financial district / industrial parks / an area with a high concentration of youthful, web-savvy gamers, etc.], where [business customers / consumers / online gaming enthusiasts] can [meet face to face to discuss contracts / drop in for a tour and demo / connect by phone with live support staff / come in and test our technology with their own applications to ensure compatibility prior to final negotiations / be drawn on for support and development positions, etc.]. We also found that other items were of great importance to our customers and prospective customers as well, including:

Customer requirement 1 Customer requirement 2 Customer requirement 3

With [Company] headquarters located [in / near / away from] the [downtown / business district / xxx] we can [provide ready access / keep overhead down / include extra, affordable space for xxx servers / accommodate anticipated growth / ensure optimal environmental conditions / incorporate the necessary space for xxx / provide easy freeway exit and return for customers arriving from the airport…]. This is important to our customers because [xxx]. Future office locations will also have to provide this [convenience / access / low overhead / space] to meet growing demand and continue to provide the [xxx] customers will have come to expect.

Our building is [a new structure / an older building, recently retrofitted to support xxx / in the high-tech xxx Business Center] meeting our requirements for [system expansion / broadband connection and availability / 24/7 guaranteed environmental control / proximity to other businesses / telecommunications connectivity through xxx / xxx]. This is important to our customers, as they count on us for [high

availability / scalability / always-on access / xxx].

This setting meets our criteria for xxx, xxx and xxx, and appeals to our customers because xxx. Our choice of an area where we would have [a free-standing building / plenty of space / no shared-space constraints / lower overhead…] allows us to [take advantage of customers drawn by marketing from other businesses in the complex / keep unique business hours responsive to customer requirements / contain our own advertising costs / participate in cooperative advertising and promotions…]

Since our building is very much a part of what we offer our customers, we have carefully shaped our overall presentation to the community. By working with a designer familiar with both the markets we serve and the clientele we want to attract and hold, we have created an environment that appeals strongly to our customers. It gives both new and returning customers a feeling of [being part of our xxx community / comfort and relaxation to conduct their business with us / their specific business needs being recognized, acknowledged and addressed / being happy to refer friends and associates or to bring friends and associates with them to our offices].

By taking the attributes of our building and location fully into account, we have created a comfort level for our customers (and employees) that encourages [a short, smooth sales cycle / long-term relationships / service and relationship expansion as their businesses grow / them to refer us to friends, associates and colleagues].

Customer ProfileOur primary audience is comprised of customers between the ages of [x] and [x], who use our online technologies [at work / on the road / during leisure time] for [data storage / collaboration / interacting with customers, associates, vendors / gaming / marketing / tracking and trading stock / watching market trends / delivering educational presentations, etc.]. Customer(s) [businesses / themselves] typically have annual [revenues / incomes] of $[xx to xx]; already own xxx, and foresee expanding their online activities to include xxx. [Company] meets their specific needs for [your product or service type] with [the best / the only / the most appealing / the most cost effective / our proprietary technology] solution for [xxx—what they want to do].

More than xx% of our customers fall into these parameters:

[Company] Customer Profile

Young ProfessionalAge: [25-35]

Income: [Medium to high]

Gender: [Male or Female]

Family: [Single / Married / Divorced]

Geographic: [Suburban]

Occupation: [White collar / Specific area of specialization if applicable]

Attitude: [Innovator]

[Company] Customer Profile

Corporate ExecutiveTitle: [President, VP Finance, VP Mfg, VP Sales, Executive Admin]

Authority: [Permitter, Decision-Maker, Influencer, Technical Advisor, Initiator]

Viewpoint: [Big Picture, Financial, Department, Personal]

Position: [Responsibilities / daily activities]

Emotional Influences: [Status, power, empire building]

Practical Influences: [Saving money, efficiency]

Education: [Ph.D., MBA, Bachelor, College, Technical School, High School]

Limitations: [Geographical, Purchasing Approval]

Sample Customer Profile

Online Computer Role-Playing Games (CRPG) Customer ProfileStatistics from a 1999 survey targeting more than 65,000 gamers in three categories, Copyright 2000, Wizards of the Coast, provide support for our assumptions regarding our market in the general US population. Our focus is the CRPG market, so we have included only CRPG data. Profile information follows:

Age CRPG All Gamers

12-15 23% 11%

16-18 16% 7%

19-24 23% 13%

25-35 37% 29%

Who plays electronic games?

Computer Console/Handheld Both

Average Age: 26 23 20

Education

% 6th-8th: 5% 20 % 27%

% 9th-12th: 23% 52% 37%

% College: 53% 26% 31%

Post Grad: 20% 2% 5%

Marital Status

% Single: 52% 65% 76%

Partnered: 46% 29% 22%

The big dollars come from adults...

Total spending by age:

12-17: $297

18-24: $850

25-35: $2,213

And, the longer they stay in the category, the greater their total outlays...

Play <=1 Year: $116

Play 1-5 Years: $562

Play >5 Years: $2,502

Sample Customer Profile

Online Astrology Customer ProfileIn addition to our own research, we found somewhat dated statistics (August-September 1996) regarding the astrology marketplace. You will note that in the intervening years, the computer market as a whole has shifted. These statistics were compiled by JMS Communications, Belgium, and the complete report can be viewed at: http://www.buff.euregio.net/surveyresult/Aug-Sep-1996.html

Age Percent of Users

11-20 23%

21-30 31%

31-40 21%

41-50 18%

51-65 3%

65+ 1%

The average user age is 31 years.

Gender

Female 79%Male 20%No Answer 1%

Country of Origin

Europe 4%North America 85%Central America 1%Africa 1%Oceania 2%Asia 7%

Zodiac Sign

Aquarius 11%Aries 7%Cancer 9%Capricorn 8%Gemini 5%Leo 8%Libra 11%Pisces 7%Sagittarius 8%Scorpio 11%Taurus 7%Virgo 7%No Answer 1%

Computer Platform/Operating System

Macintosh 13%UNIX 3%Windows 3.x 29%Windows 95 51%Other 2%No Answer 2%

Browser Market Share

Explorer 8%Navigator 82%Other 10%

Type of Internet Connection

AmericaOnline 8%CompuServe 3%Dial-up 33%Microsoft Network 10%Prodigy 2%No Answer 3%Other 41%

Send Credit Card on the Internet

Yes 20%No 76%No Answer 4%

The other xx% fall within roughly x% of these ranges, so our market is [relatively cohesive / diversified / extremely broad], making it [easy / relatively easy / difficult / nearly impossible] to identify and reach

these customers with our marketing efforts. Our approach to this market is based on our preliminary research and discussions with [existing / prospective / competitors’] customers, and plays heavily to their need for [secure online interaction / technology that meets their specific application requirements / secure, protected collaboration and interactivity / availability and scalability as their needs expand, etc.].

Our [technology / service / resource database, etc.] meets [this / these] requirement(s), and is the only one of its kind in the market at this time. With patents pending and proprietary technologies, we have created significant barriers to entry in this area, and intend to capitalize on that position for as long as possible.

Considering Additional ChannelsAccording to a study by McKinsey & Company and Salomon Smith Barney, E-tailers who sell to their customers across multiple channels significantly increase their chances of generating impressive returns and emerging victorious amid the growing e-tail shakeout.

NetLedger’s recent decision to add shrink-wrap packages in the bricks-and-mortar retail channel has influenced [Company]’s thinking with respect to offering a retail version of our xxx application service in the retail channel as well. Our initial strategy focused on exclusively-online delivery and use, as our xxx offers customers the greatest advantages in this environment. Our market has been [quite / marginally / almost non-] reachable with only online access, so we are pursuing further information to support or disprove the likely effectiveness of a move to add retail channel sales as part of our marketing strategy.

CompetitionCompetition

Starting [Company] meets our own need for [product(s) or service] as well as the needs of an expanding pool of prospective customers. To date, there are [no / few] competing online services that can match [Company]’s xxx. There is some competition from Internet sites offering products similar to ours. We foresee [only a gradual increase / a rapid increase / a delayed increase] in competition from other online services due to [xxx / our proprietary technology / established barriers to entry, etc.]. We anticipate future competition from xxx, based on [our creation of a lucrative market / increasing interest in xxx / growth of the market category, etc.].

We also offer [note the unique attributes that make your online service that is most appealing to your

customers], and as a result, we fully expect that other online [retail / related market] merchants will actually drive business our way. We have established that many of our customers use the Internet to shop and compare; but they want the assurance of xxx, which we are prepared to deliver.

Based on our own experience and extensive research, we believe there is a large market in this area, and expect that as many as [x] similar sites will probably be launched within xx [weeks / months / quarters / years] of our [launch / introduction of xxx / concept being proven]. We believe that at least [xx] sites can operate profitably for an extended period of time in this market space.

-OR-

There are [xx] competitors in the online market for our [product(s) / service]. Companies that compete in this market are [Competitor 1], [Competitor 2], and [Competitor 3]. These companies compete on [price / value / accessibility / customer loyalty…]. For [type of products/services] products, [Competitor 1] is our greatest competition. They [what they do to secure market share and sales volume]. [Competitor 2] and [Competitor 3] are less of a threat as they [what they do less effectively than you or Competitor 1].

The major strengths of our competitors are [corporate affiliations – all large chains or franchise operations / long-time presence in the community or market / established alliances with other businesses in the area / a “captive audience” in the xxx, etc.]. The major weaknesses of our competitors lie in [corporate affiliations—the lack of “home grown” ties to the community they serve / corporate constraints limiting their ability to respond to the specific market] their reliance upon their employees to portray the companies’ personal touch and customer service philosophies / transient workforce (high and college school students) / lack of product-savvy employees, etc.].

Competitive ThreatsCompetitive threats today come from [large corporate chains / other online resellers / competitor volume-purchase discounts affecting pricing / competitor expansion / increasing xxx costs, etc.]. Our strategy for meeting this threat includes [positioning our business as xxx to differentiate our business from theirs / focusing on the xxx market segment to establish our position / providing greater value to the customer through xxx / offering xxx to ensure customer loyalty and retention, etc.].

In all comparisons, [Company] offers [service / ambiance / pricing / access / product selection, etc.] superior to competitive businesses. We give our customers the [treatment / selection / service, etc.] they want, based on our [research / observation / first-hand experience in competing companies / surveys / supplier leads, etc.].

Product StrategyProduct Strategy

[Company] has established direct relationships with [Manufacturer 1] and [Manufacturer 2] who produce [product(s)]. Direct sales relationships make it possible to offer the leading-edge products from these smaller companies at higher prices and higher margins. Because the clientele for these product lines is a smaller portion of our market, it is important for us to maintain strong margins.

Our indirect manufacturer relationships come through the two largest distributors of [product(s)]. We will offer a complete line of [product(s)] for [market or application], as well as after-market accessories and [xxx—related items]. Our relationships with these major distributors provide volume incentives, a line of credit, and access to manufacturer marketing funds to help promote distributor-sourced products in our online store. This serves our purposes, as it helps to defray the costs of advertising that draws customers and prospective customers to our site.

We have made arrangements with two manufacturers to provide market testing in this area, thus securing substantial costs savings in exchange for testing, and affording us greater profitability.

Our product strategy objectives include several tactics intended to drive profits and at the same time allow for special promotions. Among them:

Product TurnsWe are targeting at least [x] turns annually for each of our high-end products in the [x] category. These products usually involve a longer sales cycle, and [x] turns will help to ensure the desired sell-through and product rotation. Product turns in the [x] category should turn faster, at [x] turns per [week / month / quarter / season / year].

Initial MarginsWe have successfully established pricing arrangements with our manufacturers and distributors that allow us an average [xx]% (for example 41% is a healthy average initial margin) initial margin crossing all product lines and categories. This provides sufficient buffer that we can safely run specials on key products roughly once per [week / month / quarter / year / blue moon], even occasionally going to a loss leader, should that be deemed appropriate under certain circumstances.

Marketing, Advertising & PublicityMarketing, Advertising & Publicity

Initially, our marketing and advertising will position [Company] as [the only online xxx providing xxx / the best source / first in sales, service and friendly people]. Launch promotions will be directed to our specific market through a cooperative effort with [related business], and to the market at large with [banner / email / billboard / shopping cart / bus / company truck] ads. Radio spots are planned for the first [x] months, and we plan to offer referral rewards and include special offers at checkout.

[Local and regional / National] media representatives will be invited to our [grand opening / launch / expansion celebration] and press conference, and a [charity auction / online contest] is planned for our [x]th month to renew interest and keep [Company]’s name in the press.

Co-Marketing Related ProductsWe [have signed / plan to sign] a co-marketing agreement with [related or dependent business or industry entity], that adds to our credibility, and drives their customers our way, and vice versa. We will share the

cost of [x] advertising and promotion for a period of [amount of time], and depending on response levels, may add other vehicles, or eliminate methods that fail to deliver an acceptable return on our investment.

Online PresenceWe noted previously that the Internet serves our customers primarily as [their source for xxx / a shopping tool to learn more about our (products or services) / a resource for product specifications / a place to order products / the (only / leading) online resource for xxx]. As we [launch xxx / open our doors / hold our grand re-opening / celebrate our new website], our site will already have been live for at least [x] weeks. We have engaged [consultant / Computer Associates / KPMG Peat Marwick / Arthur Andersen…] to handle the coordination and implementation of our online order entry system.

Online MerchandisingWe have observed that our customers are generally very responsive to [cross-sell / up-sell / suggestion / personalized offers / unadvertised specials / customer loyalty programs / banner ads…]. To capitalize on this tendency, we [offer buy-one-get-xxx-free (or x% off) / use high-quality in-page ads (rather than banners) / offer referral rewards / offer current-customer-only or manager’s specials / promote rotating feature-item specials / use shopping-cart cross-sell offers…]. To date, customer response to [promotions you’ve used] has been [excellent / good / acceptable / lackluster], and as a result, we expect to [expand the approach / change our approach / eliminate xxx promotions / test several new approaches, as suggested by xxx].

ManagementManagement

[Company] will be managed by Danny Hall, [Founder 2] and [other principals]. We have hired [xx] [product or market] enthusiasts as full-time staff and [xx] students from the local college to fill out our necessary staffing requirements. To help ensure early success, we have aligned ourselves with an advisory board through our Chamber of Commerce, and meet periodically with these local business owners to draw on their expertise and experience in this market.

Executive TeamDanny Hall, [Title], [age], [degree(s) and major] started [Company] in 2014 after working in [x] for [x] years. [Founder first name] has started [two / several] businesses, and acquired invaluable experience with [x] that will help make [Company] successful in a relatively short time. [Company], now in its [1 st / second / third / Xth] year, [has operated / will operate] on [its own revenues / owner equity / a family loan / a bank loan, etc.] without [external / other] funding [since it inception / until (month and year funding is expected)].

[Founder 2], [Title], [age], [degree(s) and major] has served as [title / role / occupation] in the [field / industry] for [x] years, and in [field / industry] for [x] years. Additional experience in [field / industry / research / training / experience] and [xxx] give [Founder 2 first name] the necessary skills to direct the operations of [Company], with primary emphasis on streamlining operations and implementing cost-

saving alternatives.

[Other Principal or Executive], [Title], [age], [degree(s) and major] has served a variety of companies as xxx, giving [him / her] a broad background of experience and opportunities to create xxx in differing environments and circumstances. [Principal / Exec first name] has taken [x] companies through the growth phases planned for [Company], and is ideally suited to direct the financial aspects of our success.

To complete our team, [Company] is [hiring / preparing to hire] a new [job title] and [job title]. [This / these] executive(s) will manage our [x] and [x] [departments / divisions] respectively, and assure that [x] is accomplished. With [this / these] position(s) filled, we will have everyone we need to effectively and efficiently execute our plan.

—OR—

As [Company] grows, and funding is secured, we anticipate bringing on executives to complement our existing team in the areas of xxx and xxx. We have defined specific attributes that will be essential in these roles, and created job descriptions to simplify the process of locating the right person for each position w need to fill. We also anticipate expanding our technical and support teams with individuals who have demonstrated expertise with web-based xxx, Java, and html to support our growth with xxx.

[Company] Stock Allocation[x] shares of [Company] common stock have been authorized by the State of NM. At this time [x] shares are outstanding, and have been allocated as shown above.

Stock vests over [x] years from the date of employment. In addition, we plan to allocate [x] shares of common stock for Employee Incentive stock options.

Management Team Ownership and Stock AllocationOfficers & Key Employees Age Stock

[x], Owner / Founder / President / CEO 44 5,000,000

[x], COO or Sr. Vice President [x] [x]

[x], CFO or VP Finance [x] [x]

[x], Vice President of Marketing [x] [x]

[x], Vice President of Sales [x] [x]

[x], Vice President of R&D [x] [x]

[x], Vice President of Operations [x] [x]

[x], Controller [x] [x]

[x], Corporate Attorney [x] [x]

Of the [x] people who make up the corporate staff, there are [x] founders who hold the following positions:

[x], title [x]

[x], title [x]

[x], title [x]

Each founder has been provided with [x]% of the original stock issue.

Outside SupportOur outside management advisors provide tremendous support for management decisions and creativity.

[xxx], Accountant / CPA

[xxx], Corporate Attorney

[xxx], [Type of] Consultant

The strength of the [Company] management team stems from combined expertise in both management and technical areas. This [has produced / is expected to produce] outstanding results over the [past / next] [x] years.

The leadership and alignment characteristics of [Company]'s management team have resulted in the establishment of broad and flexible goals. Our goals are designed to meet the ever-changing demands of the swift-moving marketplace requiring our products. This is evident when the team responds to situations requiring new and innovative capabilities.

Board of Directors

An outside Board of Directors, including highly qualified business and industry professionals/experts, [assists / will assist] our management team in making appropriate key decisions and taking the most effective action; however, they will not be responsible for management decisions.

[Director name], [current / past Title] of [Director affiliation / company], provides extensive expertise in [field / industry / area of specialization], to help [Company] take the best approach to [increasing sales / managing our operations / marketing our products…]. Additionally, [Director first name] has more than [x] years’ experience working with [x]—a distinct advantage for [Company] as we [introduce new products / expand our facilities / acquire xxx / move to the global marketplace…]

[Director name], [current / past Title] of [Director affiliation / company], [age], brings [x] years’ experience working [with / in] [x]. This is important for [Company] due to our focus on [area in which this director provides expertise]. As we [what do you plan to do], [Director first name] will provide invaluable insight and direction.

Board of Directors Stock AllocationsDirector Age Stock

[xxx], [Director Title] [x] [xx]

[xxx], [Director Title] [x] [xx]

[xxx], [Director Title] [x] [xx]

[xxx], [Director Title] [x] [xx]

[xxx], [Director Title] [x] [xx]

Board of Advisors[Company]’s outside Board of Advisors includes business owners and managers from a variety of businesses and disciplines. Each offers a unique perspective, and a wealth of experience to draw on as we [grow / streamline / downsize / merge / branch out…]. We also get great “cross-fertilization” for each of our respective businesses as we share ideas and suggestions. Our advisory board participates in regular brainstorming sessions, and we frequently contact advisors individually to draw on their specific areas of

expertise.

[Advisor name], is currently the [Title] of [Advisor company]. [He / she] provides a ready source of expertise relative to [business / field / industry / area of specialization], to help [Company] [what you do with the advice].

[Advisor name], [Title] of [Advisor company], [age], brings [x] years’ experience working [with / in] [business / field / industry / area of specialization]. We have identified a strong parallel between [Advisor’s business or industry] and our own, and [have been / expect to be] successful implementing a similar strategy.

Board of Advisors Stock Allocations

Advisor Age Stock

[xxx], [Advisor Title] [x] [xx]

[xxx], [Advisor Title] [x] [xx]

[xxx], [Advisor Title] [x] [xx]

[xxx], [Advisor Title] [x] [xx]

[xxx], [Advisor Title] [x] [xx]

[xxx], [Advisor Title] [x] [xx]

Staffing[Company]’s development team recognizes that additional staff is required to properly support marketing, sales, research, and support functions.

Currently, [Company] has [x] employees working in [x] [departments / groups]. An additional [x] employees will be required to meet projected market demand over the next [xx] years. Anticipated staffing requirements are listed below.

Position to be Filled # Required Required By

Management [x] [month, year]

Marketing [x] [month, year]

Sales [x] [month, year]

Engineering [x] [month, year]

Customer Relations [x] [month, year]

Technical Support [x] [month, year]

Administration [x] [month, year]

Manufacturing [x] [month, year]

Assembly [x] [month, year]

Skilled Labor [x] [month, year]

Repair [x] [month, year]

Field Service Technicians [x] [month, year]

Maintenance [x] [month, year]

ObjectivesObjectives

Projected revenues for fiscal year 20[xx], without external funding, are expected to be $[x]. Annual growth is projected to be [x]% per year through 20[xx]. We feel that within [x] [months / quarters / years] [Company] will be in a suitable position to [add additional product lines to xxx / add services that extend our customer relationships and revenue stream / expand our existing facilities…]. At this time, our objective is to [secure a prominent market position / reclaim market share / establish a new market in an emerging industry / seize an opportunity to fill a market gap created by the demise of a major competitor, dot.bomb, etc]. Our research indicates that we should be able to meet or exceed projected revenues within [x] [months / quarters / years].

To achieve our objectives, we plan to [establish strategic partnerships / introduce xxx product or service,

etc.]. This will require [describe what you will need to do this in terms of additional people, material, facilities, a company you’ll need to acquire, etc].

As noted elsewhere, we have also established a goal of being debt-free by [month / year], and paying off our line of credit from cash flow.

RiskRisk

Like any business operation, there is always risk associated with operating a business. For [Company], we see our greatest exposure in the [current absence of competition / possibility of a sudden, drastic change in the economy / online usage suddenly at the effect of the “energy crisis” reducing customer willingness to xxx online using our service, etc.]. A significant threat to our business would most likely derive from a sudden influx of competing online services attempting to provide services similar to [Company]’s. Another possible threat would be the introduction of a similar service offered by a major corporation or conglomerate such as [xxx / Microsoft / IBM / Oracle, etc.].

In the event of a major change in the [related market] market, we might also expect to see [some reduction in sales / some increase in sales / a shift in a different related market that could drive sales away, etc…].

To reduce risk in this area, we have explored the possibility of partnering with [xxx] to promote both our businesses, and increase visibility to new customers. We have also [what you are doing to secure your market position, for example, preparing to offer additional services, tiered pricing, etc. within x amount of time—before anyone else can set up shop] to help create a barrier to entry in this market.

Business Risk

Cost Structure[Company] opened a [xxx] in [month / year]. This new [facility / division] doubled our capacity and increased our potential capacity by a factor of [xx]. In conjunction with this expansion, we significantly increased our marketing expense and overhead. Although [Company]'s [product name] and [product name] products were well accepted in the market at former levels of production, there is no assurance that we will be able to continue successfully marketing our increased production. If market acceptance of our increased production slows, margins and profitability may suffer. While we operated profitably in the first [xx] months opening this facility, with the period ended [Month, year] (unaudited), [Company] is unable to predict whether its operating results for the full fiscal year ending [date] will be profitable.

[Company] had planned to add equipment to further increase production capacity from cash flow over a period of time. However, market opportunities for [Company] products have encouraged us to accelerate our expansion plans. We believe the net proceeds from a [line of credit / loan] and cash flow from operations will be sufficient to allow [Company] to meet the expected growth in demand for our products. However, there is no minimum financing amount that must be raised. There can be no assurance that sufficient capital will be raised or that future product sales will meet our growth expectations. Should either scenario fail to occur, [Company] may elect to a) reduce the expansion to a level consistent with our former slower growth plan, or b) pursue other financing alternatives. Implementation of either of the foregoing options could delay or diminish [Company]'s ability to respond swiftly to market demand. It could also limit our growth and adversely affect our profitability.

Competition[Company] competes with national [product type] companies, several that dominate the [product] market, and are based primarily in [list states]. [Competitor 1] and [Competitor 2] have higher sales, and greater [financial / production / distribution / marketing] resources than [Company]. Although we believe that in [State(s)] most of the our market share has come from displacement of the brands produced by local competitive companies, there can be no assurance that competition in the future will not increase from the national brands or from present or new regionally-based [product type] companies, many of them, like [Company], [having recently completed / currently planning] significant [facility / capacity] expansions. Furthermore, if the market for [product type] continues to grow, the major national [product type] companies will likely devote greater resources to this segment.

Industry GrowthThe sale and consumption of [product type] has increased dramatically over the past [x] years and [Company] and other competing producers are increasing their production capacities in order to meet this growth. There can be no assurance, however, that the growth will continue at the present rate, or at all, and the demand for [product type] may not keep up with increases in supply. In this case [Company] may face heightened competition and be unable to sell sufficient quantities of our product(s) to maintain our revenue volume and profit margin.

Product Liability[Company] has [xx] Liability Insurance and will continue such coverage as long as it is available at a reasonable cost. However, future increases in premium rates could make it prohibitive for us to maintain adequate insurance coverage. A large damage award against [Company], not adequately covered by

insurance, would adversely affect our financial position.

Environmental Risk

EconomicThe economic risks affecting [Company] are [xxx]. The best strategy for [Company] is [diversification / offering numerous products or services to multiple market segments].

Weather[Company] has secured [planning / good management / xxx insurance coverage] to protect against catastrophic events such as fire, floods or drought. Despite these precautions, a major natural disaster could affect our business by causing [xxx].

Legal & GovernmentThe State and Local ordinances or zoning laws that may impact our product or production processes include [describe legal considerations that could influence your operations]. [Company] is staying abreast of legal issues facing [industry] through [industry publications] and [xxx].

Elements of Risk

Elements DegreeWeightTotal

of Risk of Risk of Risk in %

Business RiskCost Structure [x] [x] [x]

Competition [x] [x] [x]

Industry Growth [x] [x] [x]

Product Liability [x] [x] [x]

Profit Margin [x] [x] [x]

Seasonality [x] [x] [x]

Complementary Industry [x] [x] [x]

Substitution [x] [x] [x]

Suppliers [x] [x] [x]

Customers [x] [x] [x]

Personnel & Management [x] [x] [x]

Environmental RiskEconomic [x] [x] [x]

Weather [x] [x] [x]

Legal & Government [x] [x] [x]

Overall Risk [x] 100% [x]

Rationale[Xxx]

Capital RequirementsCapital Requirements

[Company] is currently funded by $[xxx,xxx] in personal investments from the founders, plus a personal loan and a secured note. Funding [has been / will be] used to complete the necessary improvements to the business space leased at 217 Adobe Rd, Taos, NM [Zip], and to cover initial development and payroll expenses for the first [x] months of business.

Based on our research and analysis, building on [Company]’s experience and what we feel are sound business assumptions, our initial capital requirements are for a $[x] [line of credit / SBA loan / private investment / VC capital infusion] by [month], [financing year]. We intend to be profitable by [month / year], and anticipate covering our [line of credit / loan / payback] from cash flow beginning in [month / year].

To accomplish this goal, we have developed a comprehensive plan to [what you plan to do—provide specific examples. Choose activities pertinent to your goals from the options below, or create statements for your specific use of desired funds]:

Maximize sales with an extensive campaign to promote our products / services. Add [new product lines / new proprietary technologies / sales offices / a direct-mail campaign, etc.]. Reinforce Customer Support services to handle the increased demands created by the influx of new

orders and broader coverage of existing accounts. Augment company staff to support and sustain prolonged growth under the new marketing plan.We will require additional investments of $[x], $[x], $[x] and $[x] in [years / months], [years / months], [years / months] and [years / months] respectively, to enable us to increase our production capacities and meet market demand.

After analyzing our working capital, we estimate our operating working capital requirements to be $[x], $[x], $[x], $[x] and $[x] for years one through five, respectively. We will need to borrow $[x] to finance working capital for a period of [months / years], with the remainder to be financed through cash from operations.

In order to purchase [additional facilities / equipment / inventory], an estimated total of $[x] loan financing is required for the five-year period ending [month / year]. The annual requirements for each year are estimated at $[x], $[x], $[x], $[x] and $[x] respectively.

The level of safety is [normal / low / high] for this [industry / type of investment]. Our confidence in achieving the attached financial projections within [x]% is [high / average / 90%]. In addition to the operation of the business, additional protection is provided by [x] as collateral. In a [worst case / liquidation / unforeseen] situation, the realizable value of the collateral would be $[x], reducing the amount "at risk" to $[x]. With a projected return of $[x], this represents a return of [x]% of the amount 'at risk'.

Use of ProceedsThe [loan / equity investment] proceeds will be used to [purchase / buy / build / develop / gain / acquire / finance] [equipment / facilities / property / working capital].

ConclusionConclusion

Based on our research, our own personal experience, and careful scrutiny of the specific audience and market where we are focused, we are convinced that the market for [Company] [product(s) / services] will support the accomplishment of our stated goals and objectives.

We have built in specific means of measuring our effectiveness in our marketing efforts, engaged with strategic partners, and secured co-marketing relationships to support our success. The market is [still wide open / growing quickly / building on the growth of the xxx industry in this area / forecast to enjoy consistent, steady growth…] over the next [x] years. We fully intend to [ride the wave / be first and best in our class / lead the way in our market / establish and maintain the highest standards / position ourselves as the [product or service] provider of choice for the xxx market.

We fully anticipate reaching our break-even point by [month / quarter / year]—ahead of schedule—and profitability in just [x] years. We will drive [x]% of profits back into the company, to support our planned [acceleration of loan payments / reduction of our line of credit balance to zero] and be operating debt free on cash from sales, with cash reserves of $[xxx] by [month / quarter / year].

Approaching our goals aggressively will allow us to build an even stronger position than indicated in this plan. Our most recent test marketing indicates that demand [may be greater than originally projected / will probably experience a sudden spike in 20xx / will be affected by xxx / will fluctuate…]. With careful monitoring, we will be prepared to respond immediately to such shifts in the market, and protect our market share and profitability.

As we expand our Internet presence to encompass [additional products for online sales / online subscriptions for xxx / community features that will attract and hold loyal customers…] we expect to further strengthen our market position. We are excited about the prospects of turning this business into a recognized contributor in our community, effectively meeting the needs of our customers, and growing with them as the market and their needs change.

Financial ModelsFinancial Models

Financial summaries follow, demonstrating the viability and expected profitability of this business. We feel strongly that these numbers are a [conservative / representative / very optimistic] assessment, and intend to re-evaluate monthly until we have established clear trends upon which we can base future projections.

Supporting DocumentsSupporting Documents

The documents that follow include supporting information relative to [Company] logistics, background, management, and preparedness for operating this business successfully.

You may choose to insert a table of contents or a list of the supplements you are including here, making it easier for your reader to find any necessary items, or to see at a glance if a particular document is included.

Insert supporting documents behind this page in your printed plan to support the viability and likely success of your business. To be sure you include everything you need, you can use this as a checklist to gather the necessary items. There is a printed, perforated copy of this list in the back of your manual that you can use, also. Include copies* of:

*Keep all original documents stored safely in a secure place such as a safety deposit box or a fire safe. Since many of these documents are sensitive in nature, you should consider including them with your business plan only upon request. Include only photocopies of the stored originals.