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Explosion Promotions offers high-impact advertising solutions to local businesses. Our only product is a direct mail coupon card with a magnet so that it can be affixed in high traffic areas like the fridge instead of being thrown in the trash or a random drawer. The amount of traffic through the kitchen will get the businesses featured on the cards seen by customers over 200,000 everyday. Some businesses have seen a conversion rate of over 50%!
The high cost of producing the card and shipping it are shared thus making this a perfect low-cost option for small businesses. The card is 6” by 11” and contains 30-40 coupons which businesses can purchase. One side has the coupons and the other has the address and magnet. Check out examples on our website.
The company has two owners Ted Farni and Mike Emerson. Ted is the General Manager and handles every aspect of the company except sales which Mike handles. Ted has been an entrepreneur since he was 4 and has a background in Finance and Banking. After a successful career in sales, Mike has come out of an early retirement to partner with Explosion Promotions and head the Sales Division.
So far, we have everything in place to start business. We have been trying to hire sales agents to cold call business owners over the phone and use our website for the presentation. Our problem has been the quality of sales people as we are only able to post free ads on Craigslist. We need funding to find a high quality sales team and provide them with materials to help them generate new business. We also need to develop a street team that will go physically to each business. These sales agents also need high quality examples to show potential clients.
Ted got the idea of magnetic coupon cards after talking to the owner of a similar business Reach4Deals.com. After seeing the potential he decided to do it bigger and better. Our coupon card is the best advertising option for local businesses versus TV, radio, newspaper, other direct mail programs (valpak). We offer a truly unique, effective, low-cost product.
The cost of sending the card out to 10,000 households is about $7,000. The profit generated is about $8,000 per card. The operating costs of our business are very low because we require payment upfront, and the card is paid for before design and shipping.
Our goal is to build this company up to 1 million in sales and year and sell the business for 10 million all within 3 years. To accomplish this goal we will need to establish 6 quarterly cards in 5 US metros (120 cards annually).
To achieve this goal within the time frame, we need a boost to get off the ground. We are requesting a total of $6.5k for the following initiatives:
- $1,500 will go towards building a full-time sales team and create marketing materials, tools, resources to ensure their success.
- $2,500 to revamp the website, add CRM, add online coupons, etc.
- $2,500 working capital (random expenses, monthly fees)
= $6,500 TOTAL
For this contribution, the investor would be a 20% general partner. We will pay you a dividend every month of $2,000. In three years, when we sell, you would get 20% of the sale price.
- $6,500 investment
+ $72,000 cash flow (36 months)
+ $2,000,000 upon sale of business
Total Profit $2,064,500