Table of Content
Introduction
Problem Solved
Competitors
Market Differentiator
Algorithm Accuracy
Market
Persona
Challenges
Subscription Business
Revenue Model
Founding Team
Addendum: Competitors
Stock Circles Team
AAPL
FB
BABA
GMCRADBE
FacebookSocial Consensus
Is a Strong-Sell basedon 256 votes.
Introduction
There is an 87% correlation between stock market behavior and social media sentiment. (Spencer et al, 2012)
Stock market price is based largely on News. When news hits the wire, investors talk about it on social media.
Stock Circles leverages this information to identify emerging stories, computes a course of action with an algorithm and alerts its users when the market changes.
Stock Circles Team
$FBOn it’s way up at 9:40AM ET
Demo Stock Circles Team
stockcircles.com
Problem Solved
• Our algorithm helps solve big problems:
• Reduces stock scanning complexity (finding emerging stock stories is computed for you)
• Market trends accuracy is high (confidence levels up to 97.5%)
• Monitoring and alerting is automatic (tells you when to buy or sell before it’s too late)
• Simplifies money making to a minimum
• Maximizes yield
Stock Circles Team
Competitors
• Direct competitors are few:
• Hedgechatter.com
• Marketprohit.com
• Social Market Analytics
• Indirect competitors:
• Traditional trading stations
• Traditional stock scanners
• Traditional market intelligence providers
Stock Circles Team
Market Differentiator
• Battlefield Dynamics Algorithm similar to what the military uses to inform fighter pilots of incoming threats.
• Multithreaded feed analysis
• Course of action determination
• Rules engine
• Real-time monitoring
• Pattentable technology
Stock Circles Team
Algorithm Accuracy
• The algorithm is very good at spotting emerging trends and at assigning the correct course of action (COA).
• If the volume of social media votes surveyed by the algorithm is large enough for specific stock, we can confidently say that the story is real.
• Inversely, if there is little data to survey, the algorithm’s margin of error rises accordingly.
Stock Circles Team
Market
Self-directed Investor Market
• 43 million in the U.S.
• These investors can be segmented down to 3 categories (Celent):
• Passive investor <3 trades per month: 23 million
• Active investor 3 and 10 trades per month: 17 million
• Active trader over 10 trades per month: 3 million
Our sweet spot are the active investors and traders or 20 million.
Stock Circles Team
Persona Stock Circles Team
Paul Birch
Age: 51 years oldYearly Household Income: $170,000Occupation: IT Director
Investments: Invests in Stocks, Mutual Funds in E*tradeMoney Invested: $590,000Anxiety: Can’t stand the volatility of the market
Frequency: 10+ Trades/MonthMarket Knowledge: Very knowledgeable
Challenges
Fear of innovations
• Traders using technical analysis are entrenched into their methodology
• Lack of influencers supporting the technology
• Finance is always a little behind when it comes down to adopting new technologies
Stock Circles Team
Subscription Business
• SEM, SEO, email program targeting proficient Self-Directed Investors
• Free: Watchlist: 5 stocks, limited access.
• $29/month: Watchlist: 10 stocks, Unlocks all views.
• $99/month: Watchlist: 50 stocks, all the above plus alerts daily.
• $499/month: Watchlist: 100 stocks all the above plus alerts in real-time.
Stock Circles Team
Revenue Model Stock Circles Team
TOTAL ONLINE METRICS
Dec 2014 Jan 2015 Feb 2015 Mar 2015 Apr 2015 May 2015 Jun 2015 Jul 2015 Aug 2015 Sep 2015 Oct 2015 Nov 2015
Total Monthly Revenue $31 $102 $443 $1,253 $3,695 $7,991 $16,828 $28,594 $51,246 $80,471 $117,246 $160,409 $468,311Total Monthly Marketing Cost $250 $375 $2,500 $8,200 $12,600 $20,000 $25,500 $31,500 $41,250 $50,000 $66,250 $72,500 $330,925Total Monthly Online Margin ($219) ($273) ($2,057) ($6,947) ($8,905) ($12,009) ($8,672) ($2,906) $9,996 $30,471 $50,996 $87,909
Margin % N/A N/A N/A N/A N/A N/A N/A N/A 19.5% 37.9% 43.5% 54.8%
Total Monthly Trialers from Online 52 77 172 448 747 1,301 1,603 2,034 3,324 4,149 5,212 5,882 25,001 Total Monthly Subs from Online 1 3 12 30 90 168 348 504 946 1,316 1,762 2,220 7,400
Overall Monthly Cost / Trial (CPL) $5 $5 $15 $18 $17 $15 $16 $15 $12 $12 $13 $12
Overall Monthly Cost / Acq. (CPA) $240 $145 $208 $274 $140 $119 $73 $62 $44 $38 $38 $33
Accumulated Revenue $31 $134 $577 $1,830 $5,525 $13,516 $30,344 $58,939 $110,185 $190,656 $307,902 $468,311
Accumulated Marketing Cost $250 $625 $3,125 $11,325 $23,925 $43,925 $69,425 $100,925 $142,175 $192,175 $258,425 $330,925
Accumulated Margin ($219) ($491) ($2,548) ($9,495) ($18,400) ($30,409) ($39,081) ($41,986) ($31,990) ($1,519) $49,477 $137,386
Accumulated Margin % N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 16.1% 29.3%
Accumulated Gross Margin, Online (219) (491) (2,548) (9,495) (18,400) (30,409) (39,081) (41,986) (31,990) (1,519) 49,477 137,386
Accumulated Gross Margin % N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 16.1% 29.3%
Accumulated Trialers from Online 52 129 301 749 1,496 2,797 4,400 6,434 9,758 13,907 19,119 25,001
Accumulated Subs from Online 1 4 16 46 135 303 651 1,155 2,101 3,417 5,179 7,400
TOTAL SUBSCRIBERS FROM ONLINE 1 3 15 42 123 266 561 953 1,708 2,682 3,908 5,347
Breakeven Month - Online Margin Month 42217
Payback Month - Online Margin Month 42278
Payback Month - Gross Margin Month 42278
Revenue First 12 Months Stock Circles Team
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
Dec 2014 Jan 2015 Feb 2015 Mar 2015 Apr 2015 May 2015 Jun 2015 Jul 2015 Aug 2015 Sep 2015 Oct 2015 Nov 2015
First 12 Months Revenue
Founding Team Stock Circles Team
Jean F. Boisvert Annouchka Yameogo
Gurinder Singh Jana Clemons
CEO
V.P. Engineering
COO
V.P. Marketing
Addendum: Competitors Stock Circles Team
Direct: Stock Sentiment Apps
• Social Market Analytics: Startup - Just launched in February 2014. Has been in the business of providing social insights to hedge funds and banks via their API since 2012.
• HedgeChatter: Startup - Provides an all-in-one platform which finds REAL-TIME insights, using social media stock sentiment analysis. Generates social alerts on the next market movers.
• SNTMNT: Startup – Financial markets aren't rational. Emotions influence asset pricing. SNTMNT captures these emotions by analyzing social media sentiment.
• StockFluence: Startup - real-time market mood detection. automated trading agents which can send you buy/sell signals in real-time. customizable Media Analysis.
• Market Prophit: Start up - Using data from Twitter and other social media outlets, we provide popular market sentiment.
• Contix: Start up - Deliver value to investors and traders via analysis of social media.
Indirect: Pro Brokerage Platforms
Are interested in implementing Social Sentiment Analysis to
their trading platforms. Example:
NYSE’s intention to provide SMA to their clients via their
trading platform
Indirect: Stock Recommendations Providers
Such as Bloomberg, The Street, Seeking Alpha, Financial
Times
Trending on Twitter: Social Sentiment Analytics