campus one
TRANSCRIPT
ASummer Internship Project
ON
Investment AnalysisFor
RKP VENTURE CAPITAL LLP
In the partial fulfilment of the Degree of
Masters in Management Studies
Under
University of Mumbai
Mr. Shetty Deepak Prabhakar
[MMS Semester III Roll No:1603]
Specialization :(Finance)
Batch: 2015-17Under the Guidance of
External Guide Internal Guide
CA. Arpit Bohora Prof. Raghavedra_Bendigeri
(Director,RKP Ventures) (Professor,OIM)
Oriental Institute of Management
Vashi, Navi Mumbai-400703
2015
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DECLARATION
This is to declare that I Shetty Deepak Prabhakar, student of Oriental Institute
of Management (OIM), Vashi MMS Finance from batch 2015-2017, has given original
data and information to the best of my knowledge in the project report titled “Investment
analysis for RKP Venture Capital LLP” is a record of independent work carried out by
me under the guidance and supervision of the Prof Raghavedra_Bendigeri towards the
partial fulfilment of requirement for the M.M.S. degree course under University of
Mumbai.
I also agree in principal not to share the vital information with any other person
outside the organization and that I have not submitted it for any award or any other title,
degree or diploma.
Date: 1-08-2016
Place: Navi Mumbai
Name: Shetty Deepak Prabhakar
Roll No: 1604
Specialization: Finance
Batch: 2015-2017
CERTIFICATE
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This is to certify that the project entitled “Investment analysis for RKP Venture
Capital LLP”, submitted to Oriental Institute of Management, Navi Mumbai in the
partial fulfilment of the requirements for the award of the degree of Master in
Management Studies of University of Mumbai embodies the results of bonafide project
work carried out by Shetty Deepak Prabhakar under my guidance and supervision.
To the best of my knowledge the results embodied in this project have not been submitted
to any other university or institute for the award of Degree or Diploma. The assistance
and help received during the course of this investigation has been duly acknowledged.
Project Guide I/C Director
Prof Raghavedra Bendigeri Prof Saher Kapdi
Date: 1-08-2016
Place: Navi Mumbai
ACKNOWLEDGEMENT
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It gives me immense pleasure to present the report of Summer Internship Project which is
integral part of MMS program at Institute of Management, Mumbai University. I consider
it an honored privilege to have undergone this Internship in RKP VENTURE CAPITAL
LLP
This Training period has enriched me with valuable experience & the practical knowledge
of Industry with special emphasis on knowledge building and people management skills.
This training period has provided me with the best opportunity to put my theoretical
management knowledge to its practical use. During my training I worked with some
highly knowledgeable and enthusiastic people, without mentioning their names I could
not conclude this report.
First, I would like to express my sincere gratitude towards CA. R.K Patni – Promoter
(Owner of R.K Patni &co) for giving me the opportunity to work in this organization and
for the timely guidance, cognitive insights and constant source of inspiration provided to
me to make it a success.
I would like to thank CA. Arpit Bohora – Director (Finance), who all in spite of their
busy schedule has co-operated with me continuously and indeed, their valuable
contribution and guidance have been certainly indispensable for my project work.
I would also like to extend my sincere thanks and gratitude to Prof Raghavedra_Bendigeri - Faculty Guide, Oriental Institute of Management, Mumbai University, for assisting me in settling
all the issues related to this project. He has been of utmost help in all matters and has been
extremely cooperative and understanding to sort out all my problems.
Last but not the least I owe my sincere regards to the employees of RKP VENTURE
CAPITAL LLP for their co-operation and support.
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Table Of contents
Sr. No. Contents Page No.
1 DECLARATION 2
2 CERTIFICATE 3
3 ACKNOWLEDGEMENT 4
4 EXECUTIVE SUMMARY 6
5 INTRODUCTION 7
6INTERNSHIP OBJECTIVES & METHODOLOGIES 8
CHAPTER 17 SECTOR OVERVIEW 10
8 ORGANIZATIONAL STRUCTURE OF RKP VENTURE CAPITAL LLP 22
CHAPTER 2
9 About CampusOne Education Solution Pvt Ltd 25
CHAPTER 310 INTERNSHIP ACTIVITIES 3011 PROJECTION REPORTS 3112 EXPANTION STRATERGY 3613 ABOUT FRANCHISEE INDUSTRY 4014 MARKETING BUDGET 4515 SWOT ANALYSIS 5216 LEARNING EXPERIENCE 5517 CONCLUSION 5618 BIBLOGRAPHY 57
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EXECUTIVE SUMMARY
The project is a result of understanding RKP VENTURE CAPITAL LLP . which is a Venture capital firm. This was in the process of association with CampusOne Education solutions Pvt Ltd while I was appointed as an intern in RKP VENTURE CAPITAL LLP
As an Interest, I Opted For Finance As My Specialization In Master Of Management Studies. Here I took an opportunity to work with RKP VENTURE CAPITAL LLP to Gain an overall knowledge and entire exposure in field of finance and related activities for my summer internship.
Working With a venture capital firm turned out to be beneficial which helped me to know more aspect about finance and how is it interconnected to other department of the organization. Skills like costing, projection, valuation, budgeting etc was acquired during the course of my internship which will help me to in the long run of my carrier.
This Report Is Divided Into The Following Sections:
Chapter 1: will discuss about the Definition, Nature and Scope of Ventures capital firms in Education Service Industry.
Chapter 2: will deal with research done on CampusOne education solution Pvt Ltd with analysis of balance sheet of previous years and making a projected balance sheet and its summary report.
Chapter 3 : will showcase strategies prepared for the following years with respect to franchisee models and Marketing budget.
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INTRODUCTION
RKP VENTURE CAPITAL LLP, Creating Future Values has been promoted by CA. Rakesh Patni, a practicing Chartered Accountant having enormous experience of over 20 years in finance and management. His areas of specialization include Tax, Audits, Investment in Real Estate & Private Business / Equity Investment, Stock – trading, Loan Syndication, etc. His in-depth understanding of the industry has been instrumental in building durable relationships. He manages the overall supervision of the operations of RKP VENTURE CAPITAL LLP and handles the strategy and planning for the growth of the organization.
CA. Rakesh Patni has catered to the need of various business organizations in diverse industries, which has resulted in acquiring vast understanding of Indian business environment. His pool of experience and ideas has helped his clients implement their business ideas successfully.
RKP VENTURE CAPITAL LLP has an expert in house team of various MBA / CA’s who study & research about the various classes of Assets which give maximum returns on Investment and advice them to clients for assured earnings. Under the profound guidance of our founder CA. Rakesh Patni, our professionals have gained immense knowledge of this domain. Our core values are Commitment, Transparency, Confidentiality and Trust. The above combination has resulted in Satisfactory Deliverance to our clients in every assignment we have undertaken.
Corporate Vision
To become a recognized Investment Advisory Services company.
To maximize appreciation on investment in various class of assets.
To endeavor restlessly for maximizing returns with structured superior Investment
solutions.
To act as a gateway to globalization of the client’s products & services
To launch a SME / Real Estate Fund
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INTERNSHIP OBJECTIVES & METHODOLOGIES
I choose to work with RKP VENTURE CAPITAL LLP. During this internship I have learnt many new skills. Before internship I have only theoretical knowledge about work in organisation but now I have practical some practical experience of working in organisation. Now I have knowledge about the organisation’s working environment and how organisations work and achieve their goals and objectives.
This internship has to gives me the understanding of business and also about the elements of strategic thinking, planning and implementation, and how these things are applied in a real world organisation environment. Following are the objectives that I have in my mind before working as an internee.
Following were my Objectives for which the internship was done:
To gain an overall idea about industry/corporate exposure
To correlate between the textbook knowledge [Classroom learnings] of
management and management applied in corporate.
To learn how to promote and to conduct research in a business area.
To get a feeling about how various departments in an organization
co-ordinates in a uniform harmony and how they function
The policies of the company with respect to their goals, mission, vision etc.
Internship provided me the opportunity to test my own interest in a
marketing career before permanent commitments are made
To get an opportunity to develop attitudes conducive to effective interpersonal
relationships.
To promote my personal knowledge and professional preparation for future.
To properly integrate my theoretical knowledge and practical work.
To get exposure to do a work in an organization and also known about
organizational behavior, ethical rules and regulations.
Plan -> Design -> Build -> Measure -> Improve
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Chapter 1
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SECTOR OVERVIEW
BackgroundEducation in India is provided by the public sector as well as the private sector, with control and funding coming from three levels:
central state local
Under various articles of the Indian Constitution, free and compulsory education is provided as a fundamental right to children between the ages of 6 and 14. The ratio of public schools to private schools in India is 7:5.
The education sector in Asian countries has witnessed a massive growth in terms of the number of institutes and students in the past few decades. The associated policies and procedures related to various educational functions like admission, teaching, interaction and examination have grown manifold and been streamlined. Also, it has been seen that the information technology tools have offered quite promising solutions to enable effective management of these functions.This trend has induced a growing need in schools and academic institutions to use technology that delivers effective management solutions. Enterprise resource planning (ERP) is one such tool.
Scope of ERP in India
According to the latest report by Gartner, the software as a service or SaaS-based ERP solution is expected to grow at 28% CAGR. Wherein, the public cloud services market in India is growing at 29.8% in 2014 to total USD 550 million.Spending on SaaS will hit USD 218 million in 2014, growing 30.3% from 2013 through 2014. Gartner predicts that from 2013 through 2017, USD 4 billion will be spent on cloud services in India and SaaS is the largest overall cloud market segment.
Major challenges that we face are on the school front. Availability of a good and consistent internet connection & its access to teachers & administration is a major concern. Also, parents in Tier II & Tier III cities are not that tech savvy as compared to Tier I and 60% of our customers are based out in non-metro cities.
Why integration of ERP is justified?
The integration of the ERP system in the educational institutions is completely justified because of the increasing requirement for centralized access to data. The need to optimize resources leading to better scheduling of staff members also leads to the incorporation of the ERP system. Some basic and apparent advantages of the ERP solution are little or no capital investment to get started, very high return on investment, reduction in manpower resources, etc.
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Demand-Supply Gap
Indian society puts a premium on knowledge and its acquisition - spending on education has figured as the single largest outlay for a middle class household after food and groceries. With its rapidly expanding middle class, India’s private expenditure on education is set to increase manifold. India’s public expenditure on education (centre plus state expenditure) has ranged between 3.26 % and 3.85% from 2004- 05 till 2009-10 and this needs to increase if it were to come at par with the expenditure incurred by the developed economies. While there has been some private investment in setting up educational institutions, there remains a glaring mismatch in demand and supply, particularly in high quality institutions. Example - only 1 out of approximately 150 applicants gets admission into the elite Indian Institute of Management (IIMs) compared with the ratio of 1:10 for MIT. It is therefore not surprising that an industry chamber has recently reported that 450,000 Indian students spend over USD 13 billion each year in acquiring higher education overseas. To reduce the demand supply gap in school education, it has been proposed in the 12th FYP (2012-17) to set up 6,000 schools at block level as model schools to benchmark excellence. Of these, 2500 will be set up under Public Private Partnership. Further, easy availability of education loans to students it has been proposed in Budget 2012-13 to set up a Credit Guarantee Fund for this purpose.
Switching to cloud based ERP makes sense-
The cloud-based ERP systems are now taking over the traditional methods of managing data and processes because of its various advantages such as:
Provide enhanced data storage capacity, security and control. Give a real-time access from anywhere and helps in quick, yet well-
informed decision making. Reduce upfront investments in IT hardware and servers, without worrying
about dedicating significant personnel resources to managing it. Are usually fast and easy to install than on-site deployments. Also,
maintenance is much easier Most importantly, with cloud technology, product enhancements are
painless, customizations and integrations automatically update with system upgrades which assure that the business is running with the most advanced capabilities.
With an increasing number of big corporate houses entering the educational sector, the school management process itself has undergone a paradigm shift in the last few years. Most importantly, a lot of these practices are being implemented to optimize the resources available at the school.
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FEATURES OF A VENTURE CAPITAL
The main features of venture capital are:
Long-time horizon: In general, venture capital undertakings take a longer time —
say, 5-10 years at a minimum — to come out commercially successful; one
should, thus, be able to wait patiently for the outcome of the venture.
Lack of liquidity: Since the project is expected to run at start-up stage for several
years, liquidity may be a greater problem.
High risk: The risk of the project is associated with management, product and
operations.
Unlike other projects, the ones that run under the venture finance may be subject
to a higher degree of risk, as their result is uncertain or, at best, probable in nature.
High-tech: Venture capital finance caters largely to the needs of first-generation
entrepreneurs who are technocrats, with innovative technological business ideas
that have not so far been tapped in the industrial field.
However, a venture capitalist looks not only for high-technology but the
innovativeness through which the project can succeed.
Equity participation and capital gains: A venture capitalist invests his money in
terms of equity or quasi-equity. He does not look for any dividend or other
benefits, but when the project commercially succeeds, then he can enjoy the
capital gain which is his main benefit. Otherwise, he will be losing his entire
investment.
Participation in management: Unlike the traditional financier or banker, the
venture capitalist can provide managerial expertise to entrepreneurs besides
money.
Since many innovations and inventions cannot be commercialized due to lack of
finance, venture capital finance acts as a strong impetus for entrepreneurs to
develop products involving newer technologies and to commercialize them.
Venture capital has also gained in importance as a mechanism for the
rehabilitation of sick companies. Moreover, venture capitalists also assist smaller
units in upgrading their technology.
KEY FACTORS FOR THE SUCCESS OF A VENTURE CAPITAL
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The key factors for the success of any project under the consideration of a venture capitalist are:
Clear and objective thinking;
Operational experience, especially in a start-up;
Firm grasp of numbers of numbers;
People management skills;
Ability to spot technology and market trends;
Wide network of contacts;
Knowledge of all facets of business — marketing, Finance and HR;
Judgment to evaluate them on the basis of integrity and ability;
Patience to pursue the final goal;
Drive to guide budding entrepreneurs; and
Empathy with entrepreneurs.
WHAT DO VENTURE CAPITALISTS LOOK FOR WHILE
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INVESTING?
1. A GROWING MARKET: The venture capitalists see whether the company is targeting a substantial and rapidly growing market. Does the company have a reasonable chance to successfully enter the market and obtain a strong market position?
2. A UNIQUE PRODUCT: Is the company having a proprietary or differentiated product? Does the product offer benefits over existing products? Does it have patent or other proprietary protection to forestall competitors?
3. IPO CANDIDATE OR ACQUISITION TARGET: Whether the company has the possibility of growing quickly and becoming an attractive acquisition target or IPO candidate? Venture capitalists are concerned about how they will realize liquidity and receive value for their investment.
4. SOUND BUSINESS PLAN: Is the company's strategy and business plan sound? Venture capitalists expect to see a well-thought-out, coherent business plan.
5. SIGNIFICANT GROSS PROFIT MARGINS: Can the product or service generate significant gross profit margins (40 percent or more)? Large profit margins give a company room for error and enhance its attractiveness for a possible IPO or acquisition.
6. HOME RUN POTENTIAL: Finally, the venture capitalist wants to see the possibility of hitting a "home run" by investing in the company. Most venture capitalists won't be interested unless the company can grow to at least $25 million in sales within five years.
.
METHODS OF VENTURE FINANCING
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A pre-requisite for the development of an active venture capital industry is the availability of a variety of financial instruments which cater to the different risk-return needs of investors. They should be acceptable to entrepreneurs as well.
Venture capital financing in India took four forms:- Equity Conditional Loan Convertible Debentures Cumulative Convertible Preference Share
Equity:-
All VCFs in India provides equity. When a venture capitalist contributes equity capital, he acquires the status of an owner, and becomes entitled to a share in the firm’s profits as much as he is liable for losses. The advantage of the equity financing for the company seeking venture finance is that it does not have the burden of serving the capital, as dividends will not be paid if the company has no cash flows.The advantage to the VCFs is that it can share in the high value of the venture and make capital gains if the venture succeeds.
Conditional Loans:-
A conditional loan is repayable in the form of a royalty after the venture is able to generate sales. No interest is paid on such loans. In India, VCFs charged royalty ranging between 2-15%.
Convertible Debentures & Cumulative Convertible Preference Shares:-
Convertible Debentures and Convertible Preference Shares require an active secondary market to be attractive securities from the investors’ point of view. In the Indian context, both VCFs and entrepreneurs earlier favored a financial package which has a higher component of loan. This was because of the promoter’s fear of loss of ownership and control to the financier and because of the traditional reluctance and conservation of financier to share in the risk inherent in the use of equity. Cumulative Convertible Preference Shares are particularly attractive in the Indian context since CPP shareholders do not have a right to vote. They are, however, entitled to voting if they do not receive dividend consequently for two years.
PROCESS OF VENTURE CAPITAL
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DEAL ORIGINATION
SCREENING
DUE DILIGENCE
DEAL STRUCTURING
POST INVESTMENT ACTIVIES/ EXIT
Venture capital investment activity is a sequential process involving five steps:
Deal origination Screening Evaluation or due diligence Deal structuring Post-investment activities and exit
Explanation to above diagram:
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1. Deal origination :
A continuous flow of deals is essential for the venture capital business. Deals may originate in various ways. Referral system is an important source of deals. Deals may be referred to the VCs through their parent organizations, trade partners, industry associations, friends etc. The venture capital industry in India has become quite proactive in its approach to generating the deal flow by encouraging individuals to come up with their business plans. Consultancy firms like Mckinsey and Arthur Anderson have come up with business plan competitions on an all India basis through the popular press as well as direct interaction with premier educational and research institutions to source new and innovative ideas. The short listed plans are provided with necessary expertise through people who have experience in the industry.
2. Screening :
VCFs carry out initial screening of all projects on the basis of some broad criteria. For example the screening process may limit projects to areas in which the venture capitalist is familiar in terms of technology, or product, or market scope. The size of investment, geographical location and stage of financing could also be used as the broad screening criteria.
3. Evaluation or due diligence
Once a proposal has passed through initial screening, it is subjected to a detailed evaluation or due diligence process. Most ventures are new and the entrepreneurs may lack operating experience. Hence a sophisticated, formal evaluation is neither possible nor desirable. The VCs thus rely on a subjective but comprehensive, evaluation. VCFs evaluate the quality of the entrepreneur before appraising the characteristics of the product, market or technology. Most venture capitalists ask for a business plan to make an assessment of the possible risk and expected return on the venture. Following points are taken into consideration while performing due diligence.
These include- BACKROUND MARKET AND COMPETITORS TECHNOLOGY AND MANUFACTURING MARKETING AND SALES STRATEGY ORGANIZATION AND MANAGEMENT FINANCE AND LEGAL ASPECT
4. Investment Valuation
The investment valuation process is aimed at ascertaiing an acceptable price for the deal. The valuation process goes through the following steps:Projections on future revenue and profitability Expected market capitalization Deciding on the ownership stake based on the return expected on the proposed investment The pricing thus calculated is rationalized after taking in to consideration various economic scenarios, demand and supply of capital, founder's/management team's track record, innovation/ unique selling propositions (USPs), the product/service size of the potential market, etc.
5. Deal Structuring
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Once the venture has been evaluated as viable, the venture capitalist and the investment company negotiate the terms of the deal, i.e. the amount, form and price of the investment. This process is termed as deal structuring. The agreement also includes the protective covenants and earn-out arrangements. Covenants include the venture capitalists right to control the investee company and to change its management if needed, buy back arrangements, acquisition, making initial public offerings (IPOs) etc, Earn-out arrangements specify the entrepreneur's equity share and the objectives to be achieved. Venture capitalists generally negotiate deals to ensure protection of their interests. They would like a deal to provide for:
A return commensurate with the risk Influence over the firm through board membership Minimizing taxes Assuring investment liquidity
The right to replace management in case of consistent poor managerial performance. The investee companies would like the deal to be structured in such a way that their interests are protected. They would like to earn reasonable return, minimize taxes, have enough liquidity to operate their business and remain in commanding position of their business. There are a number of common concerns shared by both the venture capitalists and the investee companies. They should be flexible, and have a structure, which protects their mutual interests and provides enough incentives to both to cooperate with each other. The instruments to be used in structuring deals are many and varied. The objective in selecting the instrument would be to maximize (or optimize) venture capital's returns/protection and yet satisfy the entrepreneur's requirements. The different instruments through which a Venture Capitalist could invest a company include: Equity shares, preference shares, loans, warrants and options.
6. Post-investment Activities and Exit
Once the deal has been structured and agreement finalized, the venture capitalist generally assumes the role of a partner and collaborator. He also gets involved in shaping of the direction of the venture. This may be done via a formal representation of the board of directors, or informal influence in improving the quality of marketing, finance and other managerial functions. The degree of the venture capitalists involvement depends on his policy. It may not, however, be desirable for a venture capitalist to get involved in the day-to-day operation of the venture. If a financial or managerial crisis occurs, the venture capitalist may intervene, and even install a new management team. Venture capitalists typically aim at making medium-to long-term capital gains. They generally want to cash-out their gains in five to ten years after the initial investment. They play a positive role in directing the company towards particular exit routes. A venture capitalist can exit in four ways:
Initial Public Offerings (IPOs) Acquisition by another company Repurchase of the venture capitalist Share by the investee company Sale of shared hold by venture capitalist to other capitalist
ISSUES FACED BY VENTURE CAPITALISTS IN INDIA
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Benefits on total income are currently available to domestic venture capital funds under Section 10 (23) F of the Income Tax Act. As it presently stands, the Act requires that investments are made by Venture Capital Funds only in equity instruments, which imposes avoidable constraints.
SEBI, which regulates venture capital funds permits investment in equity and equity like instruments. All over the world, instruments such as convertible preference shares, fully and partly convertible debentures are used for financing by venture capital companies.
According to the Indian Venture Capital Association, there is no regulatory framework for structuring the funds. Most of the domestic funds have been set up under the Indian Trust Act 1882. While domestic funds are required to follow SEBI guidelines, offshore funds are required to follow RBI guidelines.
There is an anomaly in the tax treatment between domestic and offshore.
Funds. Offshore funds are generally registered in Mauritius and do not pay any tax whereas domestic funds have to pay maximum marginal tax.
Even among domestic funds, funds settled by Unit Trust of India are totally exempt from tax. The contention is that offshore funds which invest only in large industries are exempt from tax whereas domestic funds that invest in small and medium industry are taxed.
Again, the provisions of Section 10 (23) F restrict venture capital companies from investing in the services sector barring computer.
There is a strong opinion that telecommunication and related services, computer hardware related services, project consultancy, design and testing services, tourism related services and health related services should qualify for exemption under the Act for venture capital investment.
There is also a view that greater flexibility should be made available to venture capital investments in unlisted securities. Interestingly, even foreign institutional investors are permitted to invest in unlisted debt instruments.
ORGANIZATIONAL STRUCTURE OF RKP Venture capital LLP
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A hierarchy is an arrangement of items (objects, names, values, categories, etc.) in which
the items are represented as being "above," "below," or "at the same level as" one another
and with only one "neighbour" above and below each level. These classifications are
made with regard to rank, importance, seniority, power status, or authority. A hierarchy of
power is called a power structure.
Promoter Directors Managers Executives Interns
Partners are often the founders of the firms. Most of the firms’ names are associated with the names of partners. They are basically the main parties who issue and sign any report (specifically audit report) on behalf of the firm. Partners mostly communicate with the Senior Managers. In other words, the progress of any report and any inquiry is made from the Senior Managers and hierarchal structure is strictly followed to avoid any disruption. Managers are inquired of by Senior Managers and mostly manager manage audit field works etc and after field work managers with cooperation of senior managers makes and finalize any audit report to be issued. Senior Manager is a qualified Chartered accountant having more than 10 year working experience. Field work and information collection and implementation of policies by adopting changes in rules & regulations is the main responsibility of supervisors and trainees. They use different kind of techniques for error and fraud detection.
Real EstateReal estate is a sector that touches every human being in all aspects of his life. RKP VENTURE CAPITAL LLP offers advice and service across all aspects of property ownership, management and financing.
Investment in EquityCA. Rakesh Patni, through his company Modest Financial Consultants & Services Pvt. Ltd. entails equity Trading and Advisory services to Clients for achieving superior returns on their investments.
Private EquityRKP Venture Capital LLP is an independent Private Equity / Private Business Advisory firm.Private equity investments are the most important funding source in the entrepreneurial marketplace.
Funding To Private PartyRKP VENTURE CAPITAL LLP has Various Clients / Businesses where the wealth can be invested / funded. We study the various Business Proposals of our Clients and advice and arrange the setup through Private Loans.
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Taxation & AuditRKP VENTURE CAPITAL LLP provides reliable project financing / syndication services with the help of our professionals.
Loan SyndicationCA. Rakesh Patni through his C.A. firm R.K.Patni & Co., Chartered Accountants started in the year 1991 provides services in the field of Audit, Taxation and Management Consultancy.
Our clients
Our address505 , Ambience Court,
Plot No. 02, Sector - 19D, Opp. Vashi RTO Office, Vashi,
Navi Mumbai-400705.Email: [email protected]
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Chapter 2
CampusOne Education Solution Pvt Ltd
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India's Only Education Managed Service Provider. Managing all core & non core functions of schools and college. CampusOne services are focussed on continuous development & Research of new technology advancement relevant to educational institutions, keeping in mind the operational issues of imbibing technology without disturbing current work style of the Institute.
List of services by CampusOne Education Solution Pvt Ltd
Major Products and their features on which RKP Ventures were focused on.
Campus Aspire
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Aspire Service is a 100% managed service providing easier and instant communication to all the stakeholders, be it Circulars, Holiday notice, Website, Gallery, Homework Fees Remainders etc. We operate 24/7 to ensure continues flow of information, also manage and process your content enabling meaningful Education.
Offering-Communication, data management, analysis and showcase is the key components in any educational institution. Campus One Aspire services bring various components like managing your website, communicate to stakeholders round the clock. Tools like SMS Service, Android Push, Dynamic Website, Secured Login and Biometric are used to keep your stakeholders connectedSending Circulars, Emergency information by SMS to stakeholders as per Campus instruction, Collecting data of events, news, happenings and updating the same on website, reducing repetitive workload of Staff by using relevant software like question paper creator, game based software for learning and delivering and more..., Maintain / manage student data, result and attendance information, Empower / Provide Training, Tools and Resources to Staff for effective delivery and Management
Glance of Services in aspire cloud.
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Campus Mobile app
The entire communication of the campus be it fees, grades, Attendance, Homework, Circulars, exam timetables, reminders, activities, Gallery and video, we can process them and deliver the same to the parents right in their mobile through push technology / SMS / website anytime anywhere . (Android / IOS / Windows / Web) your entire communication taken care. (Self Managed service also available)
Offering:CampusOne focuses on providing 24/7 managed service. Mobile Desk is a tool for Campus to stay connected on the go. We not only create your mobile campus and host it in the state of art server farm, Our Focus is on collecting the content and updating the same in the mobile campus platform which ensures smooth and efficient timely delivery of content to the stakeholder's mobile through internet or sms thus keeping them connected always.
Platform: Mobile Campus is available for the Mobile Web on all platforms, and native iOS or Android platforms
Delivery: Deliver the optimally formatted Mobile Web to each user depending on their device type.
Hosting: Our dedicated hosting solutions are constantly monitored for uptime, security and performance.
Managed: We collect, Process, Update and delivery your content anytime, anywhere
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Campus Mobile
Existing Clients of CapmusOne
Serving 1,60,000 Students & Counting Page | 28
Modern SchoolVashi
St. Mary's ICSE SchoolKoparkhairane
Western CollegeSanpada
Sai Holy Faith High SchoolKoparkhairane
Lodha World School, Thane
S.T Andrew’s High School,BandraLittle Flower High School Ghatkopar (W)
Little Flower High School
Thane
Vivekanand School Sanpada
Jaipuriar SchoolSanpada
D.V.S SchoolKoparkhairaneAnchorwala
SchoolVashi
Anjuman-I-IslamVashi
B.S.K School Byculla
Chapter 3
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INTERNSHIP ACTIVITIES
While undergoing the internship at RKP VENTURE CAPITAL LLP ,
Following were the activities which were performed by me:
1. Studying CampusOne Education solutions Pvt.
2. Assisting to prepare projected valuation for further 5 years.
3. Scheduling meetings between RKP VENTURE CAPITAL LLP and CampusOne Education solutions Pvt.
4. Look for the feasibility of the investment to be done.
5. Assisting to prepare a franchisee model.
6. Scheduling meetings with software and application solutions inorder to make some improvements in application and website.
7. Made a data base for CampusOne to target their products with respect to schools in each city according to their student population.
8. Prepare a marketing Budget
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PROJECTION REPORTS
Note:Format and particular has been mentioned in the reports below, however the amount with respect to particulars cannot be disclosed as per companies polices.
Projected Profit & Loss Account
Particulars As at
31-March-2017
As at 31-
March-2018
As at 31-
March-2019
As at 31-
March-2020
As at 31-
March-2021
1 Revenue from operations (gross) ### ### ### ### ### Less : Excise duty ### ### ### ### ### Revenue from operations (net) ### ### ### ### ###2 Other income ### ### ### ### ### Total revenue ### ### ### ### ###3 Expenses ### ### ### ### ### (a) Cost of materials consumed ### ### ### ### ### (b) Changes in inventories of finished
goods, work-in-progress and stock-in-trade
### ### ### ### ### (c) Employee benefits expense ### ### ### ### ### (d) Finance costs ### ### ### ### ###
(e) Depreciation and amortization expense
### ### ### ### ###
(f) Other expenses ### ### ### ### ### Total expenses ### ### ### ### ###4 Profit / (Loss) before tax ### ### ### ### ###5 Tax expense: (a) Current tax expense for current year ### ### ### ### ### (b) Deferred tax ### ### ### ### ###6 Profit / (Loss) for the year ### ### ### ### ###7 Earnings per share (of 10/- each) : ### ### ### ### ###
Page | 31
BALANCE SHEET As at As at As at As at As at
Particulars 31-March-
2017
31-March-2018
31-March-2019
31-March-2020
31-March-2021
A EQUITY AND LIABILITIES1 Shareholders’ funds ### ### ### ### ### (a) Share capital ### ### ### ### ### (b) Reserves and surplus ### ### ### ### ###
(c) Share Application Money Pending Allotment
### ### ### ### ###
2 Non-current liabilities ### ### ### ### ### (a) Long-term borrowings ### ### ### ### ### (b) Deferred tax liabilities (net) ### ### ### ### ###3 Current liabilities ### ### ### ### ### (a) Short-term borrowings ### ### ### ### ### (b) Trade payables ### ### ### ### ### (c) Other current liabilities ### ### ### ### ### (d) Short-term provisions ### ### ### ### ### TOTAL ### ### ### ### ###B ASSETS1 Non-current assets ### ### ### ### ### (a) Fixed assets ### ### ### ### ### (b) Tangible assets ### ### ### ### ### (c) Non-current investments ### ### ### ### ### (d) Long-term loans and advances ### ### ### ### ###2 Current assets ### ### ### ### ### (a) Inventories ### ### ### ### ### (b) Trade receivables ### ### ### ### ### (c) Cash and cash equivalents ### ### ### ### ### (d) Short-term loans and advances ### ### ### ### ### (e) Other current assets ### ### ### ### ###
TOTAL ### ### ### ### ###
Page | 32
Ratio Analysis
Particulars31-March-
201731-March-
2018
31-March-2019
31-March-2020
31-March-2021
Sales ### ### ### ### ###Material consumed ### ### ### ### ###Inventory Changes ### ### ### ### ###Gross Profit ### ### ### ### ###Employees Benefit Expenses ### ### ### ### ###Operating Profit ### ### ### ### ### Working Capital ### ### ### ### ### Profit Ratios ### ### ### ### ###Gross Profit Ratio ### ### ### ### ###Operating Profit Ratio ### ### ### ### ###Net Profit (PBT) Ratio ### ### ### ### ###Net Profit (PAT) Ratio ### ### ### ### ###Return (PBT) on Capital Employed ### ### ### ### ###Return (PAT) on Networth ### ### ### ### ### Earning per Share ### ### ### ### ###
Debt Service Coverage Ratio ### ### ### ### ###
Debt Equity Ratio ### ### ### ### ###Proprietory Ratio ### ### ### ### ###Total Liability to Networth Ratio ### ### ### ### ###Liquidity Ratio ### ### ### ### ### Asset Turnover Ratio ### ### ### ### ###Fixed Asset Turnover Ratio ### ### ### ### ###Working Capital Turnover Ratio ### ### ### ### ###Debtors Turnover Ratio ### ### ### ### ###Creditors Turnover Ratio ### ### ### ### ### Growth Rate of Total Revenue ### ### ### ### ### Increase in Expenses ### ### ### ### ###
Page | 33
Estimated Cash Flow (Indirect Method)
Particulars FY 2017 FY 2018 FY 2019 FY 2020 FY 2021INFLOW From Operational Activities Net Profit After Taxation ### ### ### ### ###Depreciation ### ### ### ### ###Increase in Trade payables ### ### ### ### ###Decrease in Trade Receivables ### ### ### ### ###Decrease in Inventories ### ### ### ### ###Increase in Other Current Liabilities ### ### ### ### ###Increase in Short-term provisions ### ### ### ### ###Decrease in Short term Loans & Advances ### ### ### ### ###Decrease in Other Current Asset ### ### ### ### ###From Investment Activities Decrease in Fixed Asset ### ### ### ### ###Decrease in Non Current Investments ### ### ### ### ###Increase in Short-term borrowings ### ### ### ### ###Decrease in Loans & Advances ### ### ### ### ###From Financial Activities Increase in Capital ### ### ### ### ###Increase in Secured Loans ### ### ### ### ###Increase in Deferred Tax ### ### ### ### ###Total Inflow ### ### ### ### ###OUTFLOW ### ### ### ### ###From Operational Activities Decrease in Trade payables ### ### ### ### ###Decrease in Other Current Liabilities ### ### ### ### ###Decrease in Short-term provisions ### ### ### ### ###Increase in Inventories ### ### ### ### ###Increase in Trade Receivables ### ### ### ### ###Increase in Short- term Loans & Advances ### ### ### ### ###Increase in Other Current Assets ### ### ### ### ###From Investment Activities Increase in Fixed Assets ### ### ### ### ###Increase in Non Current Investments ### ### ### ### ###Increase in Loans & Advances ### ### ### ### ###Decrease in Short-term borrowings ### ### ### ### ###From Financial Activities Decrease in Share Capital ### ### ### ### ###Decrease in Secured Loans ### ### ### ### ###Decrease in Deferred Tax ### ### ### ### ###Total Outflow Net Cash Flow ### ### ### ### ### Opening Cash Balance ### ### ### ### ###Closing Cash Balance ### ### ### ### ###
Summary of Findings in the above reports.
Page | 34
Audited the accompanying balance sheets of CampusOne education Pvt Ltd as of 31st March, 2013, 2014 and 2015, and the related statements of income, retained earnings, and cash flows for the years then ended, and the related notes to the financial statements.
The main findings of the report shows that, in general, CampusOne education Pvt has a stable source of income with a which is receivable at quarterly basis in the form of there fee charged for services provided.
Guidelines should also be communicated to accounting offices across the Department in order to standardize the accounts receivable management process. to monthly income.
Their more need of working capital to me maintained in the form of cash as daily operation were at stake for eg- daily admin cost and monthly salary.
Most of these can be solved with a good amount of investment in the business which will help it to use its business to expand and get to a larger scale
The review of the accounts receivable management process should be integrated into other initiatives in the Department, such as the evaluation of the state of preparedness of audit-ready departmental financial statements.
Could be worked on a expansion policy as per the capital funding availability done on the firms such as franchisee model or an aggressive marketing strategy to get into a wider market.
Scope of business had a nationwide ability to do business and get a exponential business
However daily emerging competitors might be a road block for a bigger market share.
However being a only managed services for education industry will help CampusOne education solution to have a better status with a reasonable funding for their different products which will also help to diversify the risk for the investor.
EXPANTION STRATERGY
Page | 35
CAMPUS ONE Assumptions-Model is as per Rs 400Break Even@ 2500 students1000 Students assumed in each school.
Projected Expenses by CampusOne
Sr Particulars Calculation Total1 Rent Nil 02 Manpower Nil 03 Promotion/Advertisement/Branding 10000 X Per month X 60=600000 600000
4 Marketing material 1500 X Per month X 60=120000 90000
5 Equipments Operational equipments worth Rs 35000 35000
6 Training and development Expert training will be provided by professional trainers*25000 25000
Total Exp This expenses will help franchisee to grow Exponentially 7,50,000
Projected Expenses by franchisee
Page | 36
Sr Particulars Calculation Total 17-21 Per Year
1 Rent 15000 X Per month X 60=900000 900000 180000
2 Capital investment 500000 500000 -
3 Desk top for operation 25000 25000 -
4 Camera for id purpose 5000 5000 -
5 Furniture and fixture 20000 20000 -
6 Manpower 7500 Per month X 2 X 60=900000 900000 180000
7 Other expenses 5000 P.M X 60 =300000 300000 60000
Total out flow in 5 Yrs 2650000 420000
Less: Refundable deposit 250000 -
Total out flow in 5 Yrs 2400000
Break-Even
No of Schools No of students Per student 100% 25%
Units 1 - 400 100
1 1,000 400 4,00,000 1,00,000
2 2,000 400 8,00,000 2,00,000
B/E 2,500 400 10,00,000 2,50,000
Year Wise Calculation
Page | 37
Years 2017 2018 2019 2020 2021
No of Schools/College 12 24 36 48 60
No of students 12000 24000 36000 48000 60000
Per student fee 400 400 400 400 400
Total fees 4800000 9600000 14400000 19200000 24000000
Revenue% 25% until B/E thereafter 10% 10% 10% 10% 10%
Franchisee income
6,30,000 9,60,000 14,40,000 19,20,000 24,00,00
0
Income to franchisee (Year wise)
Income for the term of 5 yrs
Years Income to franchisee
2017 6,30,000
2018 9,60,000
2019 14,40,000
2020 19,20,000
2021 24,00,000
Total revenue to franchisee 73,50,000
Franchisee’s cash flow for the year 2017-2021
Page | 38
Out flow
2017
TotalInvestment of 250000 (Franchisee fee)+250000 (Refundable security deposit) 5,00,000
9,70,000
One time charges for equipments 50,000Working capital P.Y 4,20,000
2018 Working capital 4,20,000 4,20,000
2019 Working capital 4,20,000 4,20,000
2020 Working capital 4,20,000 4,20,000
2021 Working capital 4,20,000 4,20,000
Total Out flow 26,50,000
Inflow
2017One time charges for equipments
Reimbursed by campus one. 50,0
00
680000Income by product Aspire cloud 630000
2018 Income by product Aspire cloud 9,60,000 9,60,000
2019 Income by product Aspire cloud 14,40,000 14,40,000
2020 Income by product Aspire cloud 19,20,000 19,20,000
2021Income by product Aspire cloud 24,00,00
0
26,50,000 Refund of security deposit by Campus 1 2,50,000
Total Inflow 76,50,500
Net Profit for the franchisee at the end of the contract 2017-2021
Cash inflow 76,50,500
Less- Cash out flow 26,50,000
Net income 50,00,000
ABOUT FRANCHISEE INDUSTRY
Page | 39
According to KPMG India estimates’, the franchising industry is expected to quadruple between 2012 and 2017. There is scope for Franchising industry to contribute almost 4% of India GDP in 2017 (assuming 6% Y-o-Y GDP growth between 2012 and 2017), growing from a current estimated contribution of 1.4 percent of GDP. This is also expected to create job opportunities (including both direct and indirect) for an additional 11 million people by 2017. While increasing consumption, willingness to spend, growing preference for branded products, global exposure and use of international brands is driving the demand side of franchising, increasing set of opportunity-driven competent entrepreneurs, growing awareness of Franchising as a business opportunity and its relative low risk profile are driving the supply of new franchisee units.
Services sector which includes Consumer services such as Financial Services, Courier Services, Health & Wellness and Food Service sub segments is expected to contribute to majority of the growth in Franchising in the next half decade.KPMG India estimates’ suggest that franchisees in these areas are expected to form around 55 percent of total estimated Franchisees in 2017. Franchising in Health & Wellness sub-segment is expected to grow to almost 6 times the current penetration. Retail (which includes sectors such as Apparel, Jewelry, neighborhood stores, Food & Grocery) and Education are expected to be the other major areas where there is huge scope for franchising to succeed.Allowing Foreign Direct Investment (FDI) in single brand & multi-brand retail is expected to generate interest among large international players to adopt the franchising route to enter and expand in the country.
While certain operating models with-in franchising – such as Area development and Regional Master Franchisee - appear more attractive than others, diversity in Indian consumer preferences and degree of localization are expected to impact the choice of final model to be adopted.
Today, India does not have any franchising specific laws; however various generic Indian laws such as Competition laws, Indian contract Act etc are applicable on Franchising operations. Any future consolidation with formulation of franchise specific regulations in this area should allow conducive growth of franchise systems along with protection of franchisee rights. Success of franchising is also dependent on role financial institutions can play in promoting franchising.
Changing dynamics in franchising industry would warrant a mindset change as well. A collaborative approach involving Franchisees, Franchisors, Financial institutions and industry associations is the need of the hour.
The analyses and point of view presented in the report have been validated through extensive discussions with industry players. We take this opportunity to thank the industry players for making this endeavor possible.
CampusOne Franchaisee Data
Page | 40
SR No. Name of the city State
No of students
Number of
SchoolsNumber of Franchisees
1 Mumbai MAHARASHTRA 2,092,782 4061 92 Navi Mumbai MAHARASHTRA 438,080 1080 23 Thane MAHARASHTRA 937,505 3481 44 Thane Mumbai MAHARASHTRA 497,154 999 35 PUNE MAHARASHTRA 1,835,394 7103 8
5,800,915 16724 266 AHMEDABAD Gujrat 1,268,824 3787 77 RAJKOT Gujrat 578,274 2638 28 SURAT Gujrat 1,083,989 2775 59 VADODARA Gujrat 561,021 2002 2
3,492,108 11202 1610 JAIPUR Rajasthan 1,648,716 8916 711 JODHPUR Rajasthan 841,647 5708 412 UDAIPUR Rajasthan 632,904 5,155 313 BIKANER Rajasthan 526,390 3336 214 AJMER Rajasthan 564,172 3225 215 BHILWARA Rajasthan 489,346 4108 216 KOTA Rajasthan 440,663 2406 2
5,143,838 32854 2217 DELHI DELHI 4,204,987 5743 2018 GURGAON Haryana 303,254 923 119 Noida Uttar Pradesh 434,170 1414 2
4,942,411 8080 23
20AURANGABAD (MAHARASHTRA) MAHARASHTRA 898,966 4004 4
21 NAGPUR MAHARASHTRA 917,631 3999 422 NASHIK MAHARASHTRA 1,265,762 5407 623 SOLAPUR MAHARASHTRA 873,887 4668 4
3,956,246 18078 1824 LUCKNOW Uttar Pradesh 1,368,832 4952 6
25 AGRA Uttar Pradesh 987,751 5,2
15 426 ALIGARH Uttar Pradesh 861,430 4379 427 ALLAHABAD Uttar Pradesh 1,535,449 5950 628 BAREILLY Uttar Pradesh 979,077 4506 4
5,732,539 25002 2429 GHAZIABAD Uttar Pradesh 594,756 1791 330 GORAKHPUR Uttar Pradesh 935,165 4521 431 KANPUR NAGAR Uttar Pradesh 1,023,042 5106 532 MEERUT Uttar Pradesh 713,714 2990 333 MORADABAD Uttar Pradesh 801,851 3695 434 VARANASI Uttar Pradesh 788,706 2604 3
4,857,234 20707 2235 BANGALORE Karnataka 1,510,941 5583 636 DHARWAD Karnataka 324,578 1559 137 Udupi Karnataka 186,377 1256 138 Kochin Kerla 541,998 1409 2
Page | 41
39 BHOPALMadhya Pradesh 584,525 3190 2
40 GWALIORMadhya Pradesh 535,876 3645 2
41 INDOREMadhya Pradesh 777,797 4084 2
42 JABALPURMadhya Pradesh 490,518 3434 2
4,952,610 24,160 18
43 CHENNAI Tamil Nadu 779,291 1494 344 COIMBATORE Tamil Nadu 871,448 3102 445 MADURAI Tamil Nadu 594,387 2133 246 HYDERABAD Andra Pradesh 870,967 3661 447 VIJAYAWADA Andra Pradesh 133,788 495 148 VISAKHAPATNAM Andra Pradesh 735,266 5568 3
3,985,147 16453 1749 KOLKATA MUNICIPALITY West bengal 492,091 2746 250 HAORA West bengal 771,368 3712 351 RANCHI Jharkhand 681,971 3554 352 DHANBAD Jharkhand 623,082 2366 353 AMRITSAR Punjab 506,375 2265 254 CHANDIGARH Punjab 237,887 197 155 JALANDHAR Punjab 441,116 2297 256 LUDHIANA Punjab 728,570 2952 3
4,482,460 20089 1957 PATNA BIHAR 1,103,343 4187 558 FARIDABAD Haryana 420,344 1016 259 RAIPUR Chhattisgarh 512,753 2311 260 GOA GOA 282,871 1563 161 GUWAHATI Assam 147,713 713 162 BHUBANESWAR (Kodra) Odisha 140,111 411 1
2,607,135 10201 12
TOTAL 49,952,643
203,550 217
SUMMARY OF FINDINGS WITH RESPECT TO FRANCHISEE MODEL
Page | 42
While many brands and companies would view franchising as a key operating model for expansion from a scale and time perspective, they also believe franchising model allows them keep the brand relevant to their target consumers and result in better profitability for the system (franchisor and franchisee community) as a whole.
There are many reasons for business persons to consider franchising as a business model. Predominant of the reasons are related to capacity expansion, scale building and brand building, in a shorter span of time.
While there are other choices, scale building and brand building and Faster Time to Market emerge as dominant choices with 26 percent, 16 percent and 17 percent responses.
While Franchisors believe franchising as a good option to grow, many entrepreneurs are opting for the franchising route primarily due to it offering a safe and easy way of establishing business and offering higher than market levels of profitability. Franchising is also seen as a less-riskier option given that the business concept has already been pre-tested in the market andthe entrepreneurs get to see the results of the franchisors as well as other franchisees.
However while Franchisors believe in the concept of franchising, most franchisors are not willing to alter the terms and conditions of their proposal, in order to protect the brand value.
Increasing growth in franchising is also reflected in the increasing competition within the industry, with a constant stream of new franchisees starting their businesses. Increasing competition intensifies the need to develop unique selling proposition that can differentiate one brand from the other
Increasing growth in franchising is also reflected in the increasing competition within the industry, with a constant stream of new franchisees starting their businesses. Increasing competition intensifies the need to develop unique selling proposition that can differentiate one brand from the other.
While majority of franchisors adopt the Franchisee Owned and Franchisee Operated model for expansion, few franchisors have also mentioned the need for co- existence of Company Owned Franchisee Operated models. This was particularly necessary in high streets of metro cities where the rentals negatively impact the business viability for the franchisee. Also there are cases where franchisors want to have a few large format flagship stores. In both these cases, franchisors preferred investing initially.
FRANCHISEE SUPPORT & RELATIONSHIP MANAGEMENT
Page | 43
Project Start-Up Support is the first area of collaboration between franchisor and franchisee. Most franchisors are involved in demographic analysis of the location, site evaluation, survey and approval, facility planning and architectural design of the store and store opening (retail clients). Franchisees also acknowledge the importance of franchisor contribution in getting the basics of the project right.
Marketing Support Functions such as advertising and promotions, regional and local publicity and event based promotion schemes have been the most important support provided to franchisors. Such activities build the brand, increase credibility of the offering and ensure increased product awareness amongst the target clientele. Majority of the franchisors have indicated marketing function as the key support provided for the franchisees, which is also recognized by most franchisees. This is specifically true in the case of national level brands and large regional brands. Few of the regional brands expect the franchisees to separately share cost of regional/local marketing. However, amongst smaller brands, marketing support has been usually restricted to advertisements with nothing specific being done for local publicity. Franchisees of local brands have also indicated the diminishing of marketing support once the store/product has been launched.
Employee Training and Development is taken as a focus area amongst national brands, especially those in services franchising. Well planned employee development program encompassing well-defined processes for recruitment and selection, continuous training and up gradation of skills to the technical, operational, sales teams adds to the success of franchisee operations. Of the key challenges that new franchisees face, hiring and training of employees is the key. The challenge is particularly severe at retail concepts, where front-line employees are the face of the brand, dealing directly with each customer every day. While most franchisors have well-defined training programs, a large number of franchisees particularly find it difficult to hire good candidates and retain them. While the expectations from franchisees on this front are not as high as others, franchisors could surely improve their support in this critical area given the current shortage of skilled manpower in India.
Operational Support is an apparent area of collaboration whereby the franchisor provides defined guidelines for operations, employee management, product/service pricing guidelines, trouble-shooting support, supply chain and procurement support.Immediately after signing of the franchising agreement, operating guidelines are shared with the franchisees.Large brands deploy dedicated teams to respond to operational requirements of franchisees but the case is not the same with smaller and regional brands. Few franchisees, while appreciating the good intentions of support from franchisors, are disappointed with the pace of response for operational challenges.73 percent of the franchisees interviewed opined that the support provided by franchisors diminishes once the initial project set up activity is completed.
Franchisees are often left to take care of the businesses entirely by themselves, with minimal support from franchisors. But by then, most franchisees learn the ropes of the trade and are, hence, able to manage their business. Despite this, franchisees still seek greater involvement of the franchisors in return for the revenues shared.
MARKETING BUDGET
Page | 44
How to Plan Your Marketing Budget
Once we have determined our marketing plan and total annual budget, it’s time to align our budget with our marketing goals. This is the most important thing to keep in mind as you prioritize our expenses for our type of bussiness. We’ve already mentioned some of the categories that may be included in your marketing budget, from digital marketing to personnel costs. These categories are chosen based on our marketing campaigns and tactical plans for reaching our goals. Assign a budget amount to each category, and be thorough. As we don’t want to miss hidden costs and then have to make up for it later. For instance, if someone is marketing a product, he can’t simply plan your budget around promotional costs. We also need to consider the costs of any competitive analysis and consumer testing that might be required to ensure that our product launch and marketing efforts are successful.
Keep in mind that expenses will vary from month to month. If you are over budget in a category during one month, look at your annual budget plan to see if this balances out later - perhaps because the category is no longer needed at a later date - or if you need to reduce costs in a lower priority area. Creating a detailed and realistic plan will help you stay on budget and on task for achieving your long-term goals.
Marketing Budget Plan Template
This marketing budget plan template shows itemized categories, an estimated cost for each item, subtotals for each category, and a grand total. The simple layout is easy to read, and there is room for additional notes beside each category. This template is designed to let you organize all of your expenses into a single budget plan. Use it for annual planning or a marketing campaign of any length.
CAMPAIGN TYPE PROJECTED SUBTOTAL %
Venue ### 16%Travel ### 24%Public Relations ### 14%Décor ### 4%Event Programming ### 24%Social Media ### 5%Advertising ### 4%Refreshments ### 3%Other ### 6%
Page | 45
Product Marketing Budget TemplateAs CampusOne sells products, research, focus groups and user testing help ensure that marketing tactics and messaging are effective. This product marketing budget includes categories for each phase of marketing as you move toward a product launch. Proper planning and research will help ensure a successful outcome, potentially saving you money in the long run.
CATEGORY
FISCAL YEAR TOTALSQ1 TOTALS Q2 TOTALS Q3 TOTALS Q4 TOTALS
PROJECTED
ACTUAL
PROJECTED
ACTUAL
PROJECTED
ACTUAL
PROJECTED
ACTUAL
PROJECTED
ACTUAL
DIFFERENC
EProduct
Research
### ### ### ##
# ### ### ### ##
# ### ### ###
Competitive Analysi
s### ##
# ### ### ### ##
# ### ### ### ##
# ###
Focus Groups ### ##
# ### ### ### ##
# ### ### ### ##
# ###
Paid Studies ### ##
# ### ### ### ##
# ### ### ### ##
# ###Market
Research
### ### ### ##
# ### ### ### ##
# ### ### ###
Impact
Studies### ##
# ### ### ### ##
# ### ### ### ##
# ###
Surveys ### ##
# ### ### ### ##
# ### ### ### ##
# ###Product
Release
### ### ### ##
# ### ### ### ##
# ### ### ###
Software /
Hardware
### ### ### ##
# ### ### ### ##
# ### ### ###
Launch
Events### ##
# ### ### ### ##
# ### ### ### ##
# ###
Press Releas
es### ##
# ### ### ### ##
# ### ### ### ##
# ###
Public
Relations
### ### ### ##
# ### ### ### ##
# ### ### ###
Advertising ### ##
# ### ### ### ##
# ### ### ### ##
# ###Content
Marketing
### ### ### ##
# ### ### ### ##
# ### ### ###
Webinars /
Demos### ##
# ### ### ### ##
# ### ### ### ##
# ###
Press Releas
es### ##
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# ### ### ### ##
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Page | 46
Case Studies ### ##
# ### ### ### ##
# ### ### ### ##
# ###White
Papers /
ebooks### ##
# ### ### ### ##
# ### ### ### ##
# ###
Other ### ##
# ### ### ### ##
# ### ### ### ##
# ###TOT
ALS ### ### ### ##
# ### ### ### ##
# ### ### ###
ANNUAL MARKETING BUDGET
This annual marketing budget offers a simple layout with columns for monthly, quarterly and yearly costs. The template includes categories for market research, branding, public relations, lead generation, digital marketing, events, sales support and travel. Organize your annual marketing plan while tracking monthly expenses. This template can be as detailed as needed depending on the scope of your marketing campaigns.
CATEGORY FISCAL
YEAR TOTALS
Q1 TOTAL
S
Q2 TOTAL
S
Q3 TOTAL
SQ4
TOTALS
National Marketing ### ### ### ### ###Banner Ads ### ### ### ### ###Local Marketing ### ### ### ### ###Newspaper ### ### ### ### ###In-Store Marketing ### ### ### ### ###POP ### ### ### ### ###Public Relations ### ### ### ### ###Public Events ### ### ### ### ###Sponsorships ### ### ### ### ###Press Releases ### ### ### ### ###Webinars ### ### ### ### ###Conferences ### ### ### ### ###Client Events ### ### ### ### ###Content Marketing ### ### ### ### ###Sponsored Content ### ### ### ### ###Landing Page ### ### ### ### ###White Papers / ebooks ### ### ### ### ###Social Media ### ### ### ### ###Twitter ### ### ### ### ###Facebook ### ### ### ### ###Pinterest ### ### ### ### ###Instagram ### ### ### ### ###Google+ ### ### ### ### ###
Page | 47
LinkedIn ### ### ### ### ###Online ### ### ### ### ###Blog ### ### ### ### ###Website ### ### ### ### ###Mobile App ### ### ### ### ###Mobile Alerts ### ### ### ### ###Email Newsletter ### ### ### ### ###Advertising ### ### ### ### ###Online ### ### ### ### ###Print ### ### ### ### ###Outdoor ### ### ### ### ###Radio ### ### ### ### ###Television ### ### ### ### ###Web ### ### ### ### ###Development ### ### ### ### ###Pay-Per-Click Marketing ### ### ### ### ###SEO ### ### ### ### ###Market Research ### ### ### ### ###Surveys ### ### ### ### ###Impact Studies ### ### ### ### ###Sales Campaigns ### ### ### ### ###Campaign A ### ### ### ### ###Campaign B ### ### ### ### ###Campaign C ### ### ### ### ###Campaign D ### ### ### ### ###Campaign E ### ### ### ### ###Other ### ### ### ### ###Premiums ### ### ### ### ###Corporate Branding ### ### ### ### ###Business Cards ### ### ### ### ###Signage ### ### ### ### ###TOTALS ### ### ### ### ###
Page | 48
MARKETING BUDGET PLAN
This marketing budget plan template shows itemized categories, an estimated cost for each item, subtotals for each category, and a grand total. The simple layout is easy to read, and there is room for additional notes beside each category. This template is designed to let you organize all of your expenses into a single budget plan. Use it for annual planning or a marketing campaign of any length.
CAMPAIGN TYPE QTY
PROJECTED COST
PER UNITPROJECTED SUBTOTAL
COMMENTS
National Marketing
Banner Ads ### ### ### ###Local
Marketing Newspaper ### ### ### ###In-Store
Marketing### ### ### ###
POP ### ### ### ###Public
Relations Public Events ### ### ### ###Sponsorships ### ### ### ###Press Releases ### ### ### ###Webinars ### ### ### ###Conferences ### ### ### ###Client Events ### ### ### ###Content
Marketing Sponsored
Content### ### ### ###
Landing Page ### ### ### ###White Papers /
ebooks### ### ### ###
Social Media Twitter ### ### ### ###Facebook ### ### ### ###Pinterest ### ### ### ###Instagram ### ### ### ###Google+ ### ### ### ###LinkedIn ### ### ### ###Online Blog ### ### ### ###Website ### ### ### ###Mobile App ### ### ### ###Mobile Alerts ### ### ### ###Email ### ### ### ###
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NewsletterAdvertising Online ### ### ### ###Print ### ### ### ###Outdoor ### ### ### ###Radio ### ### ### ###Television ### ### ### ###Web Development ### ### ### ###Pay-Per-Click
Marketing### ### ### ###
SEO ### ### ### ###Market
Research Surveys ### ### ### ###Impact Studies ### ### ### ###Sales
Campaigns Campaign A ### ### ### ###Campaign B ### ### ### ###Campaign C ### ### ### ###Campaign D ### ### ### ###Campaign E ### ### ### ###Other Premiums ### ### ### ###Corporate
Branding### ### ### ###
Business Cards ### ### ### ###
3%10%1%
22%
10%5%18%
10%
7%9% 5%
National Market-ing
Local Marketing
Public Relations Content Market-ing
Social Media OnlineAdvertising WebMarket Research Sales CampaignsOther
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In all, this to seven key areas of focus for marketing in the above budget allocations:
Modest growth in overall budgets and staffing conceal more dramatic changes below the surface. Even with near-flat budgets, the scope of marketing responsibilities is growing, digital first is finally becoming a reality, aggressive recruitment for new skills is pervasive, and top performers are putting customer insight, data analytics, and marketing performance measurement at the top of their lists.
From an investment perspective, services marketing budgets will grow slightly in 2016, to about 1.5% of total services revenue. The increases will lag expected growth in services revenue, however, putting yet more pressure on marketers to expand scope and performance with only minimally additional resources.
Specific areas of increased investment include staffing, content development, digital, Account Based Marketing, and analytics.
One clear sign of alarm: Amid expanding scope and the search for new marketing skills, companies are allocating a mere three days to staff training and development.
More broadly, marketing leaders seem committed to increasing organizational agility—adopting the principals of agile to programs and planning—but few believe they have yet achieved this to any meaningful degree.
Continue to prioritize the development of new roles, skills, and talent Continue to invest in and optimize the digital marketing infrastructure Accelerate the development of agile processes Expand investment in deep customer insight Continue to expand the focus on Account Based Marketing precision Increase the emphasis on sales and SME enablement Accelerate the focus on data-driven decision making
An analysis says that marketing leaders have secured bigger budgets to define markets and attract, acquire and retain customers. Yet, increased funding is a double-edged sword. It brings new opportunities but puts more pressure on marketers to deliver and prove a return on the investments. Use our seven key findings to benchmark your marketing budgets and review our recommendations to enhance your digital marketing efforts.
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SWOT ANALYSIS
Strengths
We can consider an internal strong points about our business of RKP Ventures LLP (or for particular products like CampusOne) – they primarily include our core skills, competencies and expertise. They will reflect the capabilities of our business and provide a good foundation for our planning strategy.
We are able to respond very quickly as we have no red tape, and no need for higher management approval.
We are able to give really good customer care, as the current small amount of work means we have plenty of time to devote to customers.
Our lead consultant has strong reputation in the market.
We can change direction quickly if we find that our marketing is not working.
We have low overheads, so we can offer good value to customers.
Weaknesses
Internal factors that are lacking in CampusOne Educaton solution Pvt Ltd. Weaknesses need to be comprehensively assessed in order to correct them or strategically turn them into positive strengths.
Our company has little market presence or reputation.
We have a small staff, with a shallow skills base in many areas.
We are vulnerable to vital staff being sick, and leaving.
Our cash flow will be unreliable in the early stages.
Need to increase marketing budget
Better coordination
Opportunities
The likely benefits to/from our business resulting from changes in the external environment-
Our business sector is expanding, with many future opportunities for success.
Local government wants to encourage local businesses.
Our competitors may be slow to adopt new technologies.
India’s only managed services
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Threats
We as a small sized company should take the possible pitfalls or dangers resulting from changes in the external environment. These are likely to have an adverse or detrimental effect to the business of CampusOne
Lack of have a better User interface.
Need more funds to pay attention and maintain on different products.Developments in technology may change this market beyond our ability to adapt.A small change in the focus of a large competitor might wipe out any
market position we achieve.
As a result of this analysis we, RKP venture as a whole, may decide to specialize in rapid response, good value services to local businesses and local government.
Finding of SWOT analysis
Although CampusOne never managed to fully exploit its opportunities when establishing before many competitors it has been recently successful at increasing its profit as a percentage more and more each year, their success has been seen with their recent increase in market share placing them above their competitor by providing managed services and therefore taking the spot as the only managed service provider for education industry. CampusOne have been effective at improving their reputation in the local areas.
The weaknesses that CampusOne suffers from are not a loss of profits but rather a loss of potential for more profits, the fact that they operate solely in the Mumbai has been successful although it does limit their potential. Opportunities have appeared as a result of a recent academic year to make use of social media which essentially can be free advertising, the increase in online operations allows CampusOne to reduce operating costs. Other than competitors, CampusOne do not face many threats, the main one being the risk of having less cash flow however it can be improved with the help of funds raised recently.
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Recommendations
Based on the findings and analysis above, there are a few recommendations that could have potential for good to the operations of CampusOne.
The first of my recommendations is that CampusOne make more effective use of social media, if they were to have interesting content as such to share such as the recent school based ads then it would give reason for consumers to show interest, this in turn could attract more consumers and essentially would be a form of free advertising, a possible way to do this would be to offer unique offers that are only available through these social media platforms whether it be competitions or giveaways to win free goodies or simply a money saving offer to be used in store, this would give reason for consumers to want to use the social media.
CampusOne do have an effective “Brand Match” scheme that allows customers to save money if they would have saved do operation by them self however it would be a more idealistic situation if the customers didn’t have to go elsewhere to get a cheaper price, while its impractical for CampusOne to have the cheapest price they should aim to lower their
The last recommendation for CampusOne is to consider expanding into other cities, whilst this doesn’t have to mean opening a chain of branches in other cities to operate it could be as simple as experimenting with a franchisee in another cities and evaluating the progress, competitors such as ERP solutions are operating in other cities and therefore it is possible that the same will happen for CampusOne.
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LEARNING EXPERIENCE
RKP Capital Ventures were in the process to fund and acquire a part of share holdings of CampusOne education Solution Pvt Ltd.Through this internship Project and practicing the process of investment analysis I learned how do analysis of a company with the different types of ratios and Accounts.
Also had a chance to assist a marketing budget as per the need of the hour to do as an expansion strategy. Also assisted to make franchisee model as an alternate expansion strategy with the whole revenue model available.
Did gain an overall idea about Venture capital firm and how does it function.
I got the opportunity to correlate between the textbook knowledge
[Classroom learnings] of management and management applied in
corporate.
Internship provided me the opportunity to test my own interest in a
finance career before permanent commitments are made.
I tried promote my personal knowledge and professional preparation for future.
I was able to properly integrate my theoretical knowledge and practical work.
Got exposure to do a work in an organization and also known about
organizational behavior, ethical rules and regulations.
Learned few computer skills such as Microsoft Office and Drafting formal
Mails
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CONCLUSION
Overall the RKP venture capital has a good opportunity to reach to a greater height with CampusOne Education Solution. However there is a requirement a additional funding needed to meet the expansion and marketing strategy.
As far as Internship I have been exposed to a finance field on basic level that was required to improve my theoretical knowledge and rightly placing it on field.
Apart from the knowledge the support I received from my seniors and my co employees was very good which helped me to success fully complete my internship and achieve a better experience.
As I can conclude that Venture capital can be one of the best options as far as service industry is concerned which can pass on capital with their expertise which help an organization like CampusOne to flourish set a higher goal.
The purposes found such as organization looking for a Venture capital to maximizing the shares in the market and attract the new customers for their services and products.
Also have to consider right strategy and implementation of the strategy is highly required as far as organization is concerned in order to achieve the success that has been forecasted theoretically on books.
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BIBLOGRAPHY
Below links were referred to prepare this report
1. www.ceoexpress.com
2. www.themanagementor.com
3. www.google.co.in
4. www.cavindia.com
5. www.carkpco.com
6. www.rkpventure.com
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