Executive Summary

NW Architecture will be an architectural firm specializing in residential, commercial and industrial architecture in
domestic and international markets based out of the Bay Area near San Francisco, California. The firm will provide
architectural services using technologically superior processes, providing greater value for clients and
enhanced design and construction.

The target client is segmented into four categories; home owners, developers, government, and contractors. NW
Architecture's competitive edge will be the knowledge of digital-based design resources. Superior customer service
will also be a point of firm differentiation.

First year sales are expected to reach $102,000 and increase to $500,000 by the third year of operation. We will be
profitable within three years of starting.

The most significant challenges ahead include securing a suitable location, establishing the initial client base, and
ultimately positioning the firm to be able to have a presence in a larger, global market.

This business plan outlines the objective, focus, and implementation of this start-up firm.

1.1 Mission
NW Architecture offers a new type of digital interactive media for both the client and the builder. This media will
clearly show the client and the builder exactly what the design will look like and the method of construction.

With this new form of media the client doesn't have to know anything about architectural graphics or terminology
(floor plans, sections, elevations & construction documents) to have a clear understanding of what the end result will
look like. This is possible through the use of computer-rendered images and interactive video.

This media will be taken one step further by using it in the construction documents as well. The builder will be
provided with an interactive video rendering of the entire building containing both visual photographic quality images
and construction specs. Every last detail will be worked out in three dimensions in such a way that anyone who
knows how to use a computer will be able to access and understand this new means of architectural presentation.

1.2 Keys to Success

1. Provide a service that is technologically superior to the competition's.

2. Utilizing a diverse staff of architects to provide a wide variety of product styles.
3. A large array of global connections.
1.3 Objectives

1. Sales of $500,000 in Year 3 and $700,000 by Year 4.

2. Market expansion of 20% per year via the Internet.
3. Creating new niche in market by Year 4 of three dimensional construction documents and interactive digital
presentation to clients.

Company Summary
NW Architecture will provide a service of architectural design via digital media to the limits of technology. This
approach will offer optimal efficiency to the firm and superior value, design processes, and construction methods to
the client.

2.1 Company Ownership

NW Architecture will be created as a California corporation based in the Bay Area near San Francisco. It will
be owned by its principal investor and operator, Nathan Sawyer.

2.2 Start-up Summary

NW Architecture's start-up costs total $36,540. The most significant purchases needed are a blueprint machine,
plotter, and drafting supplies. Nineteen thousand dollars is needed in cash to sustain the business for the first year to
cover rent and wages until a profit is made.

Start-up

Requirements

Start-up Expenses
Legal $1,000

Stationery etc. $3,000

Brochures $1,000

Consultants $2,000

Insurance $500

Rent $1,040

Expensed Equipment $9,000

Total Start-up Expenses $17,540

Start-up Assets

Cash Required $19,000

Start-up Inventory $0

Other Current Assets $0

Long-term Assets $0

Total Assets $19,000

Total Requirements $36,540

Start-up Funding

Start-up Expenses to Fund $17,540

Start-up Assets to Fund $19,000

Total Funding Required $36,540

Assets

Non-cash Assets from Start-up $0

Cash Requirements from Start-up $19,000

Additional Cash Raised $0

Cash Balance on Starting Date $19,000

Total Assets $19,000

Liabilities and Capital

Liabilities

Current Borrowing $17,540

Long-term Liabilities $0

Accounts Payable (Outstanding Bills) $0

Other Current Liabilities (interest-free) $0

Total Liabilities $17,540

Capital

Planned Investment

Investor 1 $19,000

Other $0

Additional Investment Requirement $0

Total Planned Investment $19,000

Loss at Start-up (Start-up Expenses) ($17,540)

Total Capital $1,460

Total Capital and Liabilities $19,000

Total Funding $36,540

2.3 Company Locations and Facilities

The interim office of NW Architecture will be located in Walnut Creek, California until dedicated office space is
secured.

Services
NW Architecture will provide many levels of service to cater to large and small corporations, along with making it
affordable for middle and upper socioeconomic classes.

3.1 Service Description

In order for NW Architecture to provide this new innovative service of digital media, the company will use high speed
computers running programs such as AutoCad and Form-Z. To keep up with changes in technology, NW Architecture
will investigate all up and coming software related to digital 3-D design to stay at the forefront of the market.  Again,
this is a key strategic component to differentiate the firm and to optimize productivity and efficiency.

Market Analysis Summary

NW Architecture will provide it's service to home owners who are looking to remodel, as well as developers,
contractors and government agencies in the domestic and international markets. Although we are going to cater to a
relatively broad scope of customers, the company will decide what the target market is based on sales and trends
experienced in the initial months of operation.

4.1 Market Segmentation

Potential clients for NW Architecture's market is broken down into four categories: home owners, developers,
government, and contractors. Home owners are the largest group based on shear population and this will be
emphasized in all of the firm's marketing and promotional efforts. Targeting the remaining three groups will be
dependant upon establishing meaningful relationships, and responding and qualifying for request for proposals.
Market Analysis

Year 1 Year 2 Year 3 Year 4 Year 5

Potential Customers Growth CAGR

Home Owners/Remodels 15% 200,000 230,000 264,500 304,175 349,801 15.00%

Developers 30% 5,000 6,500 8,450 10,985 14,281 30.00%

Government 1% 30,000 30,300 30,603 30,909 31,218 1.00%

Contractors 40% 5,000 7,000 9,800 13,720 19,208 40.00%

Total 14.64% 240,000 273,800 313,353 359,789 414,508 14.64%

4.2 Service Business Analysis

The architecture business across the country is primarily made up of small- to mid-sized firms specializing in a
particular architectural type. But there are also a few large firms that have almost dominated the design of large
commercial and industrial facilities.  NW Architecture's main competitors will be the larger firms.  The reason for this
is that the larger firms have more capital to work with, which enables them to keep up with technological changes
much quicker than a small firm.

Strategy and Implementation Summary

In the first year of business, NW Architecture will focus on the bay area in California. As the firm grows, sales will
expand throughout California and across the country, eventually spreading worldwide.
5.1 Sales Strategy
"Sales" in this business is a direct result of exceptional client service. It is based on the firm's image and the referrals
that result. The more clients this company pleases, the more referrals are given. We will work to provide a positive
experience in all cases so our clients will refer and return to us for future work as well.

5.1.1 Sales Forecast

Sales are broken down into three categories: design, production, and construction. These three categories put
together make up one architecture project. The totals for each project are based on a 10% cut from the total
construction costs of each job. The following table and chart provides an overview of our forecast sales.  Actual sales
could vary depending on the project size and budget.

Sales Forecast

Year 1 Year 2 Year 3

Sales

Design $42,000 $90,000 $250,000

Production $26,000 $50,000 $85,000

Construction Documents $34,000 $70,000 $165,000

Total Sales $102,000 $210,000 $500,000

Direct Cost of Sales Year 1 Year 2 Year 3

Design $500 $500 $1,000

Production $250 $250 $500

Construction Documents $500 $500 $1,000

Subtotal Direct Cost of Sales $1,250 $1,250 $2,500

5.2 Competitive Edge

This company will have a competitive edge over both the larger and smaller firms because it will be composed of
the new generation of architects which are fluent in the digital world. Many firms today employ an older generation of
architects which find the computer a mystery, and those that do use the computer only have the ability to design in 2-
D.

Management Summary
This company will start with one AutoCAD/Form-Z architect and the founder. In August of 2007, a clerical position will
be added. By 2010, Other CAD/Form-Z architects will be hired to compensate the increased work load.

6.1 Personnel Plan

The following table summarizes our personnel expenditures for the first three years of operation.

Personnel Plan

Year 1 Year 2 Year 3

Nathan Sawyer $18,000 $35,000 $50,000

Clerical $12,000 $25,200 $26,000

CAD/Form-Z Designers $40,000 $60,000 $210,000

Total People 4 5 7

Total Payroll $70,000 $120,200 $286,000

Financial Plan
NW Architecture will increase growth and technology with cash flow as it increases through the years. Further money
will be set aside to pay for further consulting as needed.

7.1 Important Assumptions

The annual assumptions made in the following table are based on a stable economy. We will adjust these
assumptions as changes occur in the now tumultuous ecomony the Bay Area is experiencing.

General Assumptions

Year 1 Year 2 Year 3

Plan Month 1 2 3

Current Interest Rate 10.00% 10.00% 10.00%

Long-term Interest Rate 10.00% 10.00% 10.00%

Tax Rate 25.42% 25.00% 25.42%

Other 0 0 0

7.2 Key Financial Indicators

The following benchmark chart indicates our key financial indicators for the first three years.
7.3 Break-even Analysis
The following chart and table summarize our break-even analysis.

Break-even Analysis

Monthly Revenue Break-even $8,348

Assumptions:

Average Percent Variable Cost 1%

Estimated Monthly Fixed Cost $8,246

7.4 Projected Profit and Loss

Net profit is virtually nonexistent for the first two years of operation, with respectable increases after that time. Our
projected profit and loss is shown on the following table, with sales starting at $102,000 for the first year and climbing
to $500,000 the third year.

Pro Forma Profit and Loss

Year 1 Year 2 Year 3

Sales $102,000 $210,000 $500,000

Direct Cost of Sales $1,250 $1,250 $2,500

Other $0 $0 $0

Total Cost of Sales $1,250 $1,250 $2,500

Gross Margin $100,750 $208,750 $497,500

Gross Margin % 98.77% 99.40% 99.50%

Expenses

Payroll $70,000 $120,200 $286,000

Sales and Marketing and Other Expenses $8,200 $12,800 $34,500

Depreciation $0 $0 $0

Leased Equipment $1,440 $1,680 $1,920

Utilities $480 $620 $650

Insurance $1,800 $2,800 $3,500

Rent $17,030 $23,400 $23,400

Payroll Taxes $0 $0 $0

Other $0 $0 $0
Total Operating Expenses $98,950 $161,500 $349,970

Profit Before Interest and Taxes $1,800 $47,250 $147,530

EBITDA $1,800 $47,250 $147,530

Interest Expense $1,517 $1,097 $659

Taxes Incurred $374 $11,538 $37,330

Net Profit ($90) $34,615 $109,541

Net Profit/Sales -0.09% 16.48% 21.91%

7.5 Projected Cash Flow

Cash flow is vital to the well being of this company because of the duration of payment. The following chart and table
below show cash flow projections.

Pro Forma Cash Flow

Year 1 Year 2 Year 3

Cash Received
Cash from Operations

Cash Sales $0 $0 $0

Cash from Receivables $88,100 $195,282 $460,480

Subtotal Cash from Operations $88,100 $195,282 $460,480

Additional Cash Received

Sales Tax, VAT, HST/GST Received $0 $0 $0

New Current Borrowing $0 $0 $0

New Other Liabilities (interest-free) $0 $0 $0

New Long-term Liabilities $0 $0 $0

Sales of Other Current Assets $0 $0 $0

Sales of Long-term Assets $0 $0 $0

New Investment Received $6,000 $0 $0

Subtotal Cash Received $94,100 $195,282 $460,480

Expenditures Year 1 Year 2 Year 3

Expenditures from Operations

Cash Spending $70,000 $120,200 $286,000

Bill Payments $29,684 $53,805 $101,097

Subtotal Spent on Operations $99,684 $174,005 $387,097

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0

Principal Repayment of Current Borrowing $4,380 $4,380 $4,380

Other Liabilities Principal Repayment $0 $0 $0

Long-term Liabilities Principal Repayment $0 $0 $0

Purchase Other Current Assets $0 $0 $0

Purchase Long-term Assets $0 $0 $0

Dividends $0 $0 $0

Subtotal Cash Spent $104,064 $178,385 $391,477

Net Cash Flow ($9,964) $16,897 $69,003

Cash Balance $9,036 $25,932 $94,936

7.6 Projected Balance Sheet

The following table shows our projected Balance Sheet and net worth over the next three years.

Pro Forma Balance Sheet

Year 1 Year 2 Year 3

Assets

Current Assets

Cash $9,036 $25,932 $94,936

Accounts Receivable $13,900 $28,618 $68,137

Inventory $750 $750 $1,500

Other Current Assets $0 $0 $0

Total Current Assets $23,686 $55,300 $164,573

Long-term Assets

Long-term Assets $0 $0 $0

Accumulated Depreciation $0 $0 $0

Total Long-term Assets $0 $0 $0

Total Assets $23,686 $55,300 $164,573

Liabilities and Capital Year 1 Year 2 Year 3

Current Liabilities

Accounts Payable $3,156 $4,536 $8,647

Current Borrowing $13,160 $8,780 $4,400

Other Current Liabilities $0 $0 $0

Subtotal Current Liabilities $16,316 $13,316 $13,047

Long-term Liabilities $0 $0 $0

Total Liabilities $16,316 $13,316 $13,047

Paid-in Capital $25,000 $25,000 $25,000

Retained Earnings ($17,540) ($17,630) $16,984

Earnings ($90) $34,615 $109,541

Total Capital $7,370 $41,984 $151,526

Total Liabilities and Capital $23,686 $55,300 $164,573

Net Worth $7,370 $41,984 $151,526

7.7 Business Ratios

Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial
Classification (SIC) code 7383, Independent Artists (including Architects), are shown for comparison.

Ratio Analysis

Year 1 Year 2 Year 3 Industry Profile

Sales Growth 0.00% 105.88% 138.10% 11.74%

Percent of Total Assets

Accounts Receivable 58.69% 51.75% 41.40% 26.18%

Inventory 3.17% 1.36% 0.91% 3.42%

Other Current Assets 0.00% 0.00% 0.00% 50.14%

Total Current Assets 100.00% 100.00% 100.00% 79.74%

Long-term Assets 0.00% 0.00% 0.00% 20.26%

Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 68.89% 24.08% 7.93% 35.02%

Long-term Liabilities 0.00% 0.00% 0.00% 21.48%

Total Liabilities 68.89% 24.08% 7.93% 56.50%

Net Worth 31.11% 75.92% 92.07% 43.50%

Percent of Sales

Sales 100.00% 100.00% 100.00% 100.00%

Gross Margin 98.77% 99.40% 99.50% 100.00%

Selling, General & Administrative Expenses 101.81% 95.72% 79.60% 75.67%

Advertising Expenses 0.00% 0.95% 4.00% 2.64%

Profit Before Interest and Taxes 1.76% 22.50% 29.51% 1.56%

Main Ratios

Current 1.45 4.15 12.61 1.67

Quick 1.41 4.10 12.50 1.32

Total Debt to Total Assets 68.89% 24.08% 7.93% 62.06%

Pre-tax Return on Net Worth 3.84% 109.93% 96.93% 4.93%

Pre-tax Return on Assets 1.20% 83.46% 89.24% 12.99%

Additional Ratios Year 1 Year 2 Year 3

Net Profit Margin -0.09% 16.48% 21.91% n.a

Return on Equity -1.23% 82.45% 72.29% n.a

Activity Ratios

Accounts Receivable Turnover 7.34 7.34 7.34 n.a

Collection Days 57 37 35 n.a

Inventory Turnover 1.74 1.67 2.22 n.a

Accounts Payable Turnover 10.41 12.17 12.17 n.a

Payment Days 27 25 23 n.a

Total Asset Turnover 4.31 3.80 3.04 n.a

Debt Ratios

Debt to Net Worth 2.21 0.32 0.09 n.a

Current Liab. to Liab. 1.00 1.00 1.00 n.a

Liquidity Ratios

Net Working Capital $7,370 $41,984 $151,526 n.a

Interest Coverage 1.19 43.07 223.87 n.a

Additional Ratios

Assets to Sales 0.23 0.26 0.33 n.a

Current Debt/Total Assets 69% 24% 8% n.a

Acid Test 0.55 1.95 7.28 n.a

Sales/Net Worth 13.84 5.00 3.30 n.a

Dividend Payout 0.00 0.00 0.00 n.a