Contents

I. Executive Summary 1
II. Problem 2
III. Customer Segments 2
IV. Unique Value Proposition 3
V. Solutions 3
VI. Channels 4
VII. Revenue Streams 4
A. What is the revenue model? 4
` B. What are the lifetime values? 5
C. What is the revenue? 5
D. What is the gross margin? 5
VIII. Cost Structure 5
A. What are the customer acquisition costs? 5
B. What are the distribution costs? 6
C. What are the human resources costs? 7
D. What are the other additional costs? 8
IX. Key Metrics 9
X. Competitive Advantage 9
XI. Conclusion 10
XII. Bibliography 10
 I. Executive Summary
Our company, Emundo, creates water filters that are convenient for people to take
wherever they go. But it’s not just any ordinary portable water filter. It’s a lightweight product
that has a lightube to indicate when the filter needs to be cleaned out. This tube is fully run
through hydroelectricity. As the water being filtered rushes through the device some of its energy
will be stored to light up the tube. It also has attachable parts that can be connected to the filter to
make filtering water more convenient from any source. No longer does one need to bring tons
and tons of water bottles to camping trips, or road trips. There's no need to worry about unclean
water in poor 3rd world countries, business trips, or even simple family vacations. People
definitely despise bulky objects to carry around especially when traveling. Emundo perfectly
exemplifies the concept of travel-friendly. It can be slipped into very tiny spaces and ensures you
with safe water wherever you are.

Proposed Metrics: Emundo will be selling for $15 per device causing a 66.67% gross profit margin.
Conclusion: We expect to spend $591,000 to start the business during the first year. We know there will
be a loss during the first few years.
 II. Problem

All around the world many outbreaks of diseases are caused due to the improper
purification of water, especially in developing countries. According to the United Nations,
“Water-related diseases are responsible for 80 percent of all illnesses, deaths in developing
countries.” There are many water filters out there today that purify water. But, there are problems
that come with those water filters. For starters, the water filters today are big devices that cause a
burden to carry around, especially for travelers traveling to countries around the world. There are
also problems that involve water being purified from different sources. Different water sources
range from having purified water to take showers in, to purified drinking water from lakes or
streams. Water filters today are only adaptable to purify
water from one source. For example, PUR, a water filter,
only purifies water from the faucet. Another issue with
water filters today is that they are expensive. Water filters
today are large with many parts, resulting in costly prices
per device. The prices currently range from twenty to
hundreds of dollars. One of the reasons developing
countries have the most water-borne illnesses are because
of their inability to put expenses on water filters. With
these costly prices, there's no way the people in
developing countries can be helped.

III. Customer Segments

For the first few years, the primary target

customers are constant travelers, men, and women, ages
ranging from 30-45. The secondary target customers are
college students, girls, and boys, ages ranging from 22-29.
Initially customers will be within America. We will be
expanding to other countries (2nd world countries) after
the first 5 years. As said previously many of the unclean
water issues today are found in 3rd world countries. To
help our global community Emundo has decided to donate
some of our water filter units to these 3rd world countries
starting from year one. We strive to make a difference
throughout the world and decrease the mortality rates
caused by water-borne illnesses.
 IV. Unique Value Proposition

Our product allows the customer to be

able to carry a water filter that is not only
portable but also not bulky. Most portable
water filters for showers are very bulky and our
business is trying to create a product that is
both compact and small. We have also created
detachable parts to our product so that the filter
can be replaced with different parts depending
on where the filter is being used. Allowing the
filter to be used in different ways gives the
consumer the ability to use filters anywhere
such as drinking water and shower water.
Another factor that makes our product unique is
that we have included a purity light tube in the
filter. A consumer can use this reader helps
indicate if the filter is picking up any microbes.
This lets users know when to clean out the
filter. The purity reader does not have to be run
on electricity or charged in any way because it
will run on hydroelectricity. All in all,
Emundo’s ultimate goal is to gain the trust of
the global community and provide them with
the consumption of pure water through our
space efficient mechanism.

V. Solutions

Emundo consists of three top features

that make it a very good investment. First off,
Emundo is an attachable device. Tiny parts, like
the pump to pump water from lakes or a shower
head disk, can be added or removed as
necessary based on the water source. Secondly,
Emundo has the feature of reading water purity.
This feature runs on hydroelectric energy
derived from the water that's being filtered. The
purpose of the purity reader is to indicate when
the filter needs to be cleaned. Lastly, this
device is portable or compact. Most other
portable filters are bulky so we want to make
sure that our filter was compact enough so
travelers are comfortable when they carry a
filter.
 VI. Channels

The customers will have several ways of buying Emundo. First off, Emundo will be
available in many daily used retail store stores nationwide like Target or Walmart. This product
will also be available in online tractions on Emundo’s personal website as well as other retail
websites like Amazon. Since both the primary and secondary customers are from 22-45, social
media will be the major advertisement platform for this product. The secondary advertisement
area is on television channels such as ABC, NBC, CW, CBS, and FOX.

VII. Revenue Streams

A. What is the revenue
model?

Emundo is a product with

more features than filters that exist
today, which means manufacturing
costs are going to be more. The cost
including supplies and making is $5.
Shipping and packaging are an
additional $2.50. The manufacturing
price will lower as the company
grows. Looking at current filters,
prices are expensive. The Emundo has
to be cost-effective and available for a
wide variety of people with different
ranges of income. But the product
also has to profit for the company.
Therefore a 100% markup seems good which gives a total of $15 for the product. This gives the
business a profit of $7.50 for each unit sold. The product will make money through customers
online and offline.
`B. What are the lifetime values?
Emundo will last a customer for one whole year. Therefore, the product is a one-time
transaction a year. However, the consumers will have the option to purchase replaceable filters
so they won’t have to keep buying the device.This means the lifetime value of a customer for a
year is $15. Assuming the customer comes back yearly, in an 8-year projection, to buy the
product they will be spending $15, every 12 months for 8 years. This gives a lifetime value of
$960 for an 8-year projection. As the business grows past 8 years the lifetime value will
consistently increase.

C. What is the revenue?

The revenue or sales price for Emundo is $15.This price gives the business a $7.50 profit
because the cost to make the product and packaging/distributing is $7.50. The price was set up so
that the business can get an efficient profit per device as well as making the price affordable for
many individuals or families fitting our target customers. Also, this product is a one-time
investment every year, with a 7-month warranty system making the price reasonable for the
product. Existing water filters, today, range from $20-$100. The Emundo is significantly less,
price wise, as well.

D. What is the gross margin?

The cost to manufacture Emundo is approximately $5 per unit. The selling price is $15
which is a 200% markup rate. Therefore, the gross margin is 66.67% and the gross profit is $10
for every device sold. But this 200% is excluding shipping fees for each device. Shipping fees
out of the $15 are around $2.50 which means the company’s gross profit for each product is then
$7.50. This gives a result of the gross margin being 50% and the markup rate being 100% since
the business is getting half of the selling price. Like stated before, the other half is for
manufacturing and shipping to customers and retailers.

VIII. Cost Structure

A. What are the customer acquisition costs?

The customer acquisitions costs were found by dividing the cost of advertising by the
number of customers per month. The monthly advertisement cost is $2,500. In the year $50,000
will be used for sales and marketing. Of this $50,000, $30,000 will be used to market through
30-second commercials such as ABC, NBC, CW, CBS, and FOX. The other $20,000 will be
used for advertising on social media platforms like Instagram and Facebook. To furthermore
bring our product into the market and show our concern in water-borne illnesses, Emundo will be
hosting conferences with organizations such as WHO. Emundo is projected to derive 800
customers monthly with this budget for marketing/sales or in the year 10,000 customers. Going
by these numbers the customer acquisition cost is about $62.5. As the company prospers the
customer base will substantially increase to about 625,000. Emundo will also be open to 3rd
world countries after the first 5 years. Since Emundo will be giving to the global community
from year 1 there should be easily accessible channels into other countries outside the U.S.
B. What are the distribution costs?

Emundo will be available to consumers in

retail stores as well as online. The first year our
company is planned to sell at 40 department stores
such as Target and Walmart. Emundo will also be
accessible online on our personal website and
Amazon. These 40 retail stores will be in North
Carolina at cities where most travelers are found.
For example, RTP is a prospering area with the
increasing growth of employees who tend to travel.
In the second year, Emundo will expand to 124
stores in North Carolina and a few surrounding
states. Emundo will keep growing reaching 310
stores in the 3rd year and 775 in year 4. Emundo is
projected to reach 1550 stores during the 5th year
and expand nationwide in the future. There is also a
projected growth in sales on the online market as
Emundo will be open up to other retailing websites.
To physically distribute the product to customers
our company will be using the channels of our
partners like Target or Amazon. This decreases
shipping costs to $22,360. To store the goods
produced the company will be renting Q-model
Quonset priced at $11.50 which is $13,800 for every
warehouse. Based on these values, for the first year,
the distribution expenses total up to $104,360. In
addition to distributing in the country, Emundo will
also be giving back to the global community by
taking 25% of the net income to manufacture
additional goods. These goods will then be given to
developing countries for free because our company
strives to decrease the rate of death and health issues
associated with unclean water throughout the world.

C. What are the human resources costs?

In the first year, Emundo will be employing

4 members. These 4 positions include a Product
manager, an accountant/financialist, a
marketing/sales representative, and a customer service Representative. The product manager and
accountant/financialist will make approximately $60,000. The marketing/sales representative
will make $40,000 and the customer service representative will receive a wage of $48,000 per
year. This adds up to $208,000 for HR costs the first year. As the company grows into the second
year onward employees of various fields will be added like an IT/Web designer. By the 5th year,
Emundo is projected to be spending $1,053,000 on HR
costs.

D. What are the other additional costs?

 There are several additional costs to account for. The first huge cost to include is a
building for the employees. This will be a small office space rented for about $3,000 per month
or $36,000 for the first year. Utilities including water, electricity, heat,etc.,will cost $150 per
month or $3000 in a year. Technological expenses cost about $2000. Direct labor cost will be
about $38,000.Direct labor includes people working in manufacturing units. License and permit
fees are $250. Repair and maintenance or insurance costs are $1000. Cellular devices and
internet connections cost about $150.

Additional Costs/General Administration

Office Building (for rent) $35,000

Utilities $1,000

Technology $2,000

License and Permit(Patent) $525

Insurance $1,000

Device and Internet $470

Total Expenses $40,000

5 Year Financial Projection

IX. Key Metrics

There are a few key activities needed to sell Emundo's value proposition. The first
activity would be to create an online platform for the buyers to look at and order the products
through. The second activity includes marketing, sales, and advertising that will hook the
customers to buy the product. The third key activity that should be measured is the distribution
channels. The Emundo will be available in direct and indirect channels. This product will be sold
on a personal business e-commerce website which is the direct channel. The product will also be
sold through retailers and wholesalers as indirect channels. The fourth activity needed would be
partnerships with quality suppliers to ensure a good product. The last main key activity that
needs to be measured is customer relationships. The customers will have a 7-month warranty that
is $10. This warranty can be extended. In addition, the business will have customer support to
assist customers as well as a design rating system to hear customer feedback. This will help
improve the product in a way it appeals to customers and help make the product with better
qualities or tweaks.

X. Competitive Advantage

Emundo is a product that is

cost effective compared to other
water filters. There is a significant
difference in the pricing and
Emundo comes with more features
than the filters that exist today.
Some of these features include the
detachable parts, the purity reader,
2and the ability to purify water
almost anywhere. The detachable
parts are made so that the filter can
attach to any water source. For
example, if your water sources are
lakes or streams, The Emundo has
a portion of the filter that can
easily filter that water into a water
bottle. Next off, The purity reader
is a feature that determines how
acidic or basic the water is. The
Emundo is also flexible enough
that it can expand or compress into
any water source you are trying to
filter. This product will also have a patent making it unable to be easily copied or bought by
other businesses or people. The Emundo will have exclusive licensing so that other people don't
have the same rights on the idea or product. We want to make sure our product cannot be stolen
by another company.

XI. Conclusion

In conclusion, Emundo will be needing a total of $591,000 to start the business in the
first year. This total cost is accounted for many areas of fees. The cost of Emundo, the product, is
$15 and the company makes $7.50 from each device sold. The other $7.50 goes to
manufacturing, packaging, and shipping. To get more customers the product will be marketed in
different channels or networks including social media and ads. The cost of marketing comes to a
total of $50,000. Distribution costs equal $104,360. This includes the amount of money it takes
to bring the product to retailers or customers as well as the price for storage units. Next of, to run
the company employees are very important. All their salaries total up to $208,000 which in other
words is the human resources cost. Apart from these main fees listed above, many additional
costs are there too. Some of these include insurance, company building, supplies, etc. The
additional costs total up to $80,400. The final price and additional costs total does not include the
burrowing fee since the company will be paying that amount back. These prices put together
gives us $591,000. In the first year, the company will see a loss of $366,000 (not including
donation to the global community) due to having higher expenses than revenue. This financial
loss is projected to be there for 1-2 years. But with customers, feedback derived from them will
help improve quality and modify Emundo with features liked by customers. This will help boost
the product and so will the spread of words from first-year customers. Marketing is also another
tactic that will be improved over time in a projected 5 years as the company gets enough money
to support more ads or other things. Overall, Emundo should be a stable company in the next few
years especially since water purity is a serious issue today. We are asking for a $500,000
investment for 18% of our company(stake).

XII. Bibliography

“How To Calculate Lifetime Value - The Infographic.” Neil Patel, Neil Patel, 13 July 2018,
neilpatel.com/blog/how-to-calculate-lifetime-value/.
“Distribution Cost.” AccountingTools, www.accountingtools.com/articles/2017/5/6/distribution-
cost.
“How to Measure Human Resource Costs | Human Resource Costing.” Analytics in HR, 29 Oct.
2018, www.analyticsinhr.com/blog/measuring-human-resource-costs-human-resource-costing/.
“How To (Actually) Calculate CAC.” Andrewchen, 4 Nov. 2018, andrewchen.co/how-to-
actually-calculate-cac/.
“Startup Killer: the Cost of Customer Acquisition.” For Entrepreneurs, 3 June 2016,
www.forentrepreneurs.com/startup-killer/.
About Canva, Canva, www.canva.com/.