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FINAL-powerup Business Plan
FINAL-powerup Business Plan
SpotBrooklyn.com
Completed 9/08/2014
Joey Azoulai
(908) 216-7604
joey@SpotBrooklyn.com
1043 East 14th Street
Brooklyn, NY 11230
Jonathan Azoulai
(908) 216-7606
jonathan@SpotBrooklyn.com
1043 East 14th Street
Brooklyn, NY 11230
TABLE OF CONTENTS
EXECUTIVE SUMMARY
BUSINESS DESCRIPTION
11
MARKETING STRATEGY
14
OPERATIONS17
MANAGEMENT & ORGANIZATION
19
APPENDIX21
EXECUTIVE SUMMARY
Spot Brooklyn, LLC was created by us, brothers Joey and Jonathan Azoulai. The idea to start
our company had been conceived along a family car ride through Brooklyn with our parentsa
tour of our roots. Standing in front of our old first-floor apartment on Avenue U, we reflected
on how much Brooklyn has changed since my brother and I shared a bedroom (now we only
share an apartment).
Our childhood selves would hardly recognize the Brooklyn we live in today. We have our
own basketball team now! City government and real estate developers are investing in our
waterfront: building parks, sports fields, and high-rises. Neighborhoods that were once known
for warehouses and heavy industry are now home to New York Citys tech sector. Web
developers walk the same cobblestone roads that were built for horses. Thats the beauty of
Brooklynthe old and the new co-existing side-by-side, each making the other appear all the
more distinct.
Its these layers of old and new that we hope to capture with our online publication about
Brooklyn. We will share stories about the people and places who, even today, exemplify the
diversity and creative spirit that has defined Brooklyn since it was settled by the Dutch. To best
tell our stories, we have created an editorial format based around an interactive map.
We will introduce our format over the next few pages of this business plan. We will explain
how our editorial format lends itself to a lucrative advertising-based revenue model. We
will demonstrate a need for our advertising product in our local market, as well as how our
company is well-timed to take advantage of larger trends in our industry. We understand that
attracting thousands of users to our website wont be easy, so we have a strong marketing and
sales strategy in place. Finally, we will prove that we are prepared to execute on our concept
with a solid plan of operations.
We are excited to share our plan with you today!
BUSINESS DESCRIPTION
CONCEPT
OPPORTUNITY
Upcoming Stories
Upcoming Spots
LEGAL
Spot Brooklyn is a two-member limited liability company registered in the state of New York.
Our company has submitted SPOT BROOKLYN for a standard character trademark with the
U.S. Patent and Trademark Office under Class 35 and Class 41.
4
Raised $25,095
in startup capital
JULY 14
FEB 14
AUG 14
FUTURE MILESTONES
Reach profitability
Launch website
Secure dedicated
office space
MAY 15
NOV 14
Fundraising campaign
JULY 15
FINANCING
Of the $25,095 we have raised from personal savings and a loan from our parents, we have
spent $19,114 on camera equipment, legal fees, software, and other startup expenses. We
will need an additional $25,000 to hire our first Story Editor, who will create editorial content
and business ad content. The Story Editor will help us increase our publishing frequency and
the variety of topics we cover, which will increase website traffic and ultimately increase the
revenue we earn from our advertising product.
We hope to secure this additional financing from the following sources:
$10,000 fundraiser on Kickstarter (a crowdfunding website operating in Brooklyn).
$15,000 prize as the winner of the PowerUp! Business Plan competition (an initiative by
the Brooklyn Public Library and their sole sponsor, Citi Foundation).
$15,000 business loan from a traditional bank or small business lender (as a back-up plan
if we do not win the PowerUp! award).
5
rget
r of Ta
Numb
esses
Busin
Brooklyn Population
We plan to convert 13 target business owners into customers each month, and retain 69%
as customers from one month to the next. Based on these assumptions, we will convert 139
target business owners (0.77%) of our total target business owners by October 2016[3]. As a
point of comparison, Yelp, the business review website, has converted 4% of their total free
business listings into paying customers as of 2013.
YEAR 1
YEAR 2
TOTAL CUSTOMERS
YEAR 1
TOTAL REVENUE
YEAR 2
UNIQUE MONTHLY
VISITORS (AUG 14)
Spot Brooklyn
37,460
(Oct 16)
15,568
(May)
13,156
(March)
513
(Nov 14)
7,349
(Jan)
23,781
(Nov 15)
28,867
(March 16)
19,142
(Dec)
Spot Brooklyn is part of the online publishing industry. A more specific definition of our
industry includes our official designation by the US Census Bureau and our own market
observations.
The U.S. Census Bureau designates our company in the Internet Publishing and Broadcasting
and Web Search Portal industry, which includes, advertising periodical publishers, business
directory publishers, and guide and map publishers. In Brooklyn, this industry grew from 22
to 57 companies between 2008 and 2012[f].
We most closely identify our company with other online publications about Brooklyn (66) as of
August 2014, including 21 publications that cover Brooklyn and the rest of New York City, 17
publications that cover Brooklyn exclusively, and 28 publications that cover specific Brooklyn
neighborhoods.
INDUSTRY HISTORY
As consumers spend less time
with print media and more time
online, advertisers have followed
ADVERTISING REVENUE
(2007-2013)
Print A
dvertis
ing Re
venue
(billion
s)
GROWTH POTENTIAL
The online publishing
industry will capture a greater
ADVERTISING REVENUE
PROJECTIONS (2012-2018)
ile
ob
Ad
ng
isi
ert
ue
n
eve
Print Advertisin
g Revenue
BARRIERS TO ENTRY
Attracting users to a new website is difficult because there is a wealth of content on the
internet and users tend to visit a limited number of websites habitually.
Managing relationships with many small customers is labor intensive, as opposed to
serving fewer large clients.
Publishing is also a labor-intensive business that requires a significant creative staff in order
to reach scale.
10
Blankslate is a Brooklyn-based digital advertising agency that builds websites and sells ad
space for local publishers in seven metropolitan areas, including eleven publishers in Brooklyn.
Blankslate also creates and sells advertising products like sponsored blog posts, business
pages, business listings, and real estate listings. Their overlap with our product and target
customer means that Blankslate will be our biggest competitoror valued partner.
STRENGTHS
WEAKNESSES
campaigns.
Business listings provide a free or lowcost online presence for businesses.
Corner Media
Corner Media is the publisher of seven Brooklyn neighborhood blogs. Corner Medias target
user and target business owner overlaps with ours, however our products are very different.
STRENGTHS
Hyperlocal editorial content provides
WEAKNESSES
Crowded pages feature 18 display ads
audience.
mobile.
Yelp is a multinational corporation that operates a business review site primarily for
metropolitan regions. Yelps advertising products differ from ours and, although they target
similar customers, Brooklyn represents a small fraction of their target market.
STRENGTHS
A popular brand whose red People
Love Us On Yelp stickers appear on
storefronts all over Brooklyn.
Over 120,000 business listings in
WEAKNESSES
Cost of advertising is $300 to $2,200 a
monthpricey for most small businesses[q].
Aggressive business tactics have lead to
distrust between Yelp and many business
Trade Commission[s].
Google Business Listings is a free service that enables a business owners to provide their
business information to Google Search, Maps, and the Google+ social media platform.
Googles business listings are a small component of a much larger company strategy, rather
than a primary product.
STRENGTHS
Trusted brand whose name has become
the stand-in verb for internet search:
Google it.
Free services help make them the most
WEAKNESSES
Recommendations are more effectively
made by people than a computer algorithm.
Face-to-face customer relationships are not
possible given Googles worldwide market.
Spot Brooklyn
We have analyzed the internal strengths and weakness of our company, the opportunities in
our market, and the threats posed by our competitors.
STRENGTHS
Our unique editorial format is designed
WEAKNESSES
Our lack of previous experience
OPPORTUNITIES
The emerging mobile device industry
creates opportunities for startups like
ours to create new types of editorial
and advertising products.
Low-cost distribution and production
THREATS
Local competitors have a head-start in
reaching our target customers.
Large competitors have already
developed significant brand awareness
as a provider of business advertising.
13
MARKETING STRATEGY
UNIQUE SELLING PROPOSITION
To differentiate our company from our competitors, we will communicate the following benefits
of our product to each target business owner and user.
BUSINESS OWNERS
USERS
COMMUNICATION STRATEGY
Email is the most personal form of marketing on the internet, and most marketers agree that
it is still the most effective of all forms of marketing[t]. We use MailChimp.com to manage our
subscriptions and email lists, which is free for up to 2,000 subscribers per month.
Social media platforms, like Twitter and Facebook, are great for driving traffic to our
website through frequent tweets and posts announcing new content. We will encourage our
connections to share our website with their friends and followers.
14
Events hosted by the Brooklyn Startups Meetup, Brooklyn Chamber of Commerce, and the
Brooklyn Historical Society will help us make face-to-face connections with business owners
and other involved members of the community. Associated annual costs include $520 for
membership dues and and business cards[10].
Direct mail is a great way to reach target business owners. We can access the address of
every target business through the ReferenceUSA database services available at the Brooklyn
Public Library. We will create and mail 4x6 postcards to 500 businesses at a cost of $528.
GROWTH STRATEGY
New hires including Story Editors, Photographers, and Web Developers enables us to spend
more of our time on marketing and sales.
A Kickstarter campaign, in addition to helping us reach our financing goals, will also help us
reach new users through Kickstarters Brooklyn-based crowdfunding website. In exchange for
donations, we will offer the Kickstarter community handdrawn maps by local artists, and other
unique gifts to thank them for their support.
15
STRATEGIC PARTNERSHIPS
Business Improvement Districts
Blankslate
platform.
partners[13].
PRICING STRUCTURE
30-day Trial
Business Icon
FREE
99 per click +
OPERATIONS
Our main output as a company is online content. Labor costs related to content creation and
web development will be our single greatest operating expense at 49% in Year 1 and 87% in
Year 2. Other significant operating expenses include software tools for content quality control,
content creation, content distribution, and business administration. We will only list paid
services, and omit services mentioned in previous sections. A step-by-step production cycle for
content creation[14] and web development[15] is available in the appendix.
LABOR REQUIREMENTS
Position
Hire Dates
Cost
Cost
Paid Interns
(Year 1)
$3,601
(Year 2)
$7,504
Story Editors
$9,700
$71,953
Field Photographer
$12,200
$50,225
Web Developer
May 2016
N/A
$50,225
OFFICE SPACE
We are currently working from a home office. We will relocate in
April 2015 to a private office in a coworking space, which provides
Cost
Cost
(Year 1)
(Year 2)
$6,000
$18,000
QUALITY CONTROL
GitHub provides tools for us to keep track of website bugs and
$7/mo
$8/mo
17
$21.78/mo
$49/mo
$199/mo
$39.95/mo
DISTRIBUTION SERVICES
Our website is served from several different hosting services. Each service is optimized for a
specific feature of our website.
Bluehost stores and distributes the code for our website and is the
$119.88/yr
$49/mo
$129/mo
$20/mo
18
OWNERSHIP
Joey and Jonathan Azoulai each own 50% of Spot Brooklyn, LLC and are entitled to 50%
of earnings. Joey will receive 51% of the decision-making rights because of his previous
experience in our industry, and to avoid deadlocks. By November 2014, we will draft and sign
a complete operating agreement, defining each owners rights, powers, entitlements, as well as
key provisions.
MEMBERS
Joey Azoulai graduated in 2002 from Brooklyns Pratt Institute with a BFA in
Writing for Performance, Publication and Media. He has experience as an
independent Film Producer, and as a Video Producer & Marketing Writer
for childrens publishing. Joey also has experience and contacts in the New
York City restaurant industry. Joey will be responsible for web development,
content creation, and marketing.
Jonathan Azoulai graduated in 2006 from University of Connecticut with a BS
in Business Administration. He went on to work as a Manager for a national
retailer, and in production accounting for film and television. Jonathan is a
self-taught photographer and videographer. Jonathan will be responsible for
editorial research, businesses administration, and sales.
SALARIES
During the first two years of operation we will not take a regular salary. Instead, we will take an
owners draw only when the business can sustain a loss of cash flow. In Year 1 we take a total
draw of $12,000, and $74,000 in Year 2.
PROFESSIONAL RELATIONSHIPS
Lawyer: Brian Igel
Our parents play an integral role in starting our company, and will continue to advise us on key
matters as well as contribute to our overall company strategy.
Judy Azoulai graduated from Kean University with a BFA in Visual
Communication, and is an accomplished graphic designer, jewelry designer,
painter, and potter. Judy will use her visual arts experience as she advises our
company on product design.
KEY PERSONNEL
Paid Interns ($10/hour)
Story Editors will go through a 3-month paid training period in our content creation workflow
before we will consider them for the position.
Story Editors ($16.83/hour)
We intend to hire three story editors by August 2016. Each Story Editor will be responsible for
pitching, researching, and copywriting our stories and spots, as well as writing descriptions for
our business ads. Joey will serve as editor-in-chief.
Field Photographer ($31.25/hour)
We will hire one part-time photographer who will travel Brooklyn taking photos for our stories,
spots and business pages.
Developer ($36.06/hour)
We will hire one part-time developer who will take over Joeys day-to-day web development
responsibilities. Joey and Jonathan will set development priorities.
20