FUEL THE FUTURE

Business Plan Competition

Abegail ChelseaCariaso Latteri

AngeliqueDawkins

DevronGrays

EMERALD GROWA Digital Safari Greenbizz Company

Executive Summary

Over time the world has used up a significant portion of its oil supply with one third of it already depleted. America alone uses 20 million barrels of oil per day compared to other countries which use 1.5 million barrels of oil a day on average, exploiting third world countries such as Iraq in order to obtain these resources. Our dependency in foreign oils has become detrimental to our country, using a significant amount of tax money to fund the war in the Middle East. The use of fossil fuels has caused expedient deterioration of earth, causing drastic temperature changes due to its unhealthy emissions and damaging our ecosystems when an oil spill occurs. Another issue we face is the development of dead zones, areas in the ocean that have low oxygen levels due to algae blooms that cause damage to marine life along the coast. Emerald Grow is a company located in Louisiana that dedicates its efforts to decrease our dependency on oil and increase the earth’s sustainability. Our team consists of highly educated individuals who are determined to provide our nation with the cleaner fuel it deserves. The biodiesel Emerald Grow produces is made from selectively bred algae grown in fertilizer runoffs. These runoffs lead to the ocean and cause large algae blooms. During its decomposition stage, these algae blooms take up a large percentage of the ocean’s oxygen that marine life need in order to survive. Because of the oxygen displacement, over 240,000 square feet along the coast have become dead zones which have harmed markets dependent on seafood. The selectively bred algae we grow makes an excellent biodiesel because it grows rapidly and abundantly, consumes chemicals that are harmful to the environment as it grows, yields more oil than its other biodiesel competitors, and takes up a small amount of space to grow. Essentially, Emerald Fuel will be the most efficient biofuel financially and environmentally.

Supporting trends show that there is a market for Emerald Grow. In his 2008 campaign, Obama proposed to use 63 billion gallons of biofuels by the year 2013. Major fuel companies such as Exxon Mobile has invested $600 million in research and production of algae fuel.

There are thousands of construction sites who’s machinery runs on diesel that are our potential customers. Our biodiesel would be beneficial to construction companies because during the planning phases of their projects, they would have a more accurate estimation of what percentage of their expenses will be from fuel. This is because biodiesel is a renewable energy source and its price doesn’t fluctuate like regular diesel does. Not only does our company provide better predictability, but it also offers construction companies and distributers tax incentives because the biodiesel is sustainable.

Emerald Grow is requesting funds for the initial costs mainly consisting of research and development for a total of $10 million. Profit for investors will be tremendous as shown by the financial projections. As our nation makes the switch to biodiesel, our company will become one of the main producers and revenue

During a vacation to the East Coast, Abegail Cariaso noticed that the once astonishing Gulf of Mexico was now an underwater jungle of green sludge. Disappointed by the lack of marine life, she researched the cause of their departure and learned that the agricultural fertilizer run offs created algae blooms which caused these “dead zones”. When she arrived back home, she discussed the devastating sight with her friend Chelsea Latteri. Chel-sea suggested that there had to be a way in which those algae blooms could be controlled. Still, the question remained: “What would we do with all that algae if it was contained?” Another friend, Angelique Dawkins, told them that she had read online that algae could be turned into a biodiesel. Devron Grays, a former classmate of Abegail, took a class on “sustainable living” and offered to help with the technical aspects of this product devel-opment. Upon countless hours of research, networking, and pure determination, these ambitious individuals developed a process for growing algae and turning it into biodiesel, giving birth to a new company, Emerald Grow.

Company Profile

How it Started

Company Profile

Meet the Executives

Ms. Cariaso has had an alpha dog mentality since grade school. She always took initiative when given tasks and made sure her group members worked diligently in order to meet deadlines. In high school, Abegail attended two prestigious academies – the Digital Safari Academy, and the Health and Bioscience Academy where she studied in the field of digital arts as well as biotechnology. Upon gradua-tion, Abegail started an organization in Zimbabwe, provid-ing sanitary restrooms as well as health education in order to aide the victims of the cholera epidemic. She also studied the issues of multiculturalism and produced a documentary called “Parental Dilemma” which focused on a student’s pur-suit to become an artist despite her parent’s wishes for her to be in the medical field. Ms. Cariaso is highly involved in her community, volunteering at soup kitchens, running fundrais-ers, and ministering to the youth at her church. These experi-ences helped develop Abegail’s strong leadership skills, mak-ing her the most qualified candidate to hold this position.

Devron Grays is a prodigal music producer, who grew up landscaping. Working with power tools and learning what really goes into establishing substantial amounts of beautiful scenery has helped him develop a logical mindset. As a High School Student, he attended the Digital Safari Academy in order to study music production and multimedia. Because of Grays’ prior experiences through landscaping and music pro-duction, he qualified for the Chief Technical Officer position. Grays has also achieved a student of the year award for his mathematical genius in advanced calculus his freshman year in high school. Because of his great amount of prior experi-ences, Grays is a wonderful asset to our company.

Abegail CariasoChief Executive Officer

Devron GraysChief Technical Officer

Company Profile

Meet the Executives

Abegail CariasoChief Executive Officer

Devron GraysChief Technical Officer

Ms. Latteri is a buoyant and creative business woman who works diligently in order to maximize production. In high school, she attended the Digital Safari Academy to study multimedia and excelled in personal finance. Upon gradu-ation, Chelsea started an organization called Needles on Wheels in order to help AIDS victims in Uganda. Her organi-zation received first place during the Legacy of Imperialism fair. She also studied the issues of multiculturalism and cre-ated a documentary focusing on stereotypes. During the summer, she worked at a theater in Martinez California as a stage assistant. On her free time, Chelsea likes to be out-doors and playing sports. The experiences she’s gained have helped her become the right person to take on the financial responsibilities of this company.

Angelique Dawkins is always the collected and practical person in the group. Whenever a dispute breaks out within a group, she sits the members down in order to work out the situation. In her last year of high school, Angelique Dawkins transferred to the Digital Safari Academy to study multimedia where she created several design templates as well as advertisement posters. A sweet personality like Ms. Dawkins’ is essential to any business.

Chelsea LatteriChief Financial Officer

Angelique DawkinsMarketing Director

Emerald fuel is the most sustainable biodiesel. It offers more miles per gallon than regular diesel and is a lot healthier for your engine. Using biodiesel also reduces green house gas emissions Carbon Dioxide released from combustion is offset by the carbon dioxide used when growing the algae, reducing green house gas emissions by 15%. Emerald fuel is nontoxic so it causes far less damage than petroleum diesel if spilled or otherwise released into the environment. It is safe to handle, store, and transport.

Features• Grows fast• Takes little space to grow• Takes little maintenance

Environmental Benefits• Reduces Green House Gasses by 15%• Safe to handle, store and transport• Offsets Carbon Dioxide during life cycle • Reduces fertilizer run off

Consumer Benefits• Offered at fixed price• Better for engines• More miles-per-gallon• Tax subsidies from government

Thermoregulator

river

Fertilizer Filtration

Algae

Overflow area

Drainage pump site

Product Data

Harvesting Site Layout

Piping system

The innovative machinery Emerald Grow uses is the key to productivity. The Emerald Fuel Harvesting site is a unit similar to a storage unit. A pipeline allows the river water to enter the unit by the pressure exerted from the ruler current. The unit is then filled with fertilizer enriched water, where the algae begins to grow. A thermoregulator installed into the unit, monitors the temperature so that the algae maintains the ideal environment in which to grow. Once the unit reaches maximum capacity the algae is pumped into one of our trucks where it is sent to our refinery for processing.

The Fuel

The Machinery

Marketing Analysis

The human race needs to shift from its dependency on the scarce supply of fossil fuels and at the same time, keep an eye on the hazardous wastes and pollutions they are emitting into the environment . Research-ers have conducted countless jaw dropping statistics, investors have put in an enormous amount of money to fund research on alternative resources, even world leaders are making propositions in order to save the planet we call home. That’s why Emerald Grow is also joining this fight for our future by providing algae bi-odiesel while cleaning our waterways. Scientists have found a way to use algae, a single celled bacteria, to create a cleaner, more efficient biofuel. Algae consumes carbon dioxide in order to grow and doubles its size every six hours. The algae is dried to ex-tract the oil, and is made into diesel fuel that according to CEO Jonathan Wolfson of Solazyme Inc is “chemically indistinguishable from its petroleum-based equivalent and has already powered a Jeep Liberty and a Merce-dez Benz sedan.” Algae can yield thirty times more oil than crops such as soy, doesn’t compete for land with a crop that  feeds people and animals (corn), and doesn’t take much processing before it can power a diesel run-ning vehicle. Obama proposed in his campaign while running for of-fice that he demands that the US consumes 63 billion gallons of alternative fuels by 2030 in order to recog-nize that our country does not need to be dependent on foreign fuels. Investors have seen the potential in this up and coming biofuel and have invested large amounts of money to fund research as well.

Opportunity

Several investors include Bill Gates, along with his partners, who have funded Sapphire Energy Inc with $100 million, U.K. government-funded Carbon Trust which has donated $11.7 million to nine uni-versities, and Exxon Mobil which donated the larg-est amount of $600 million in order to make this fuel the new petroleum commercial product. Even the Navy has signed a contract with Solazyme to produce 150,000 gallons of fuel to run their ships. Dead zones are areas of low-oxygen water in the aquatic environment, often caused by decomposi-tion of vast algal blooms. According to a new study in science, there are now 405 identified dead zones worldwide, up from 49 in the 1960s. This is no small economic matter. In 1976, hypoxia (low-oxygen) oc-curred off the coasts of New York and New Jersey, covering a mere 385 square miles. This cost commer-cial and recreational fisheries more than $500 million. About 83,000 tons of fish and other ocean life are lost to the Chesapeake Bay dead zone each year. This is enough to feed half the commercial crab catch for a year. Robert Diaz of The College of William & Mary says “More than 235,000 tons of food is lost to hypoxia in the Gulf of Mexico.” “That’s enough to feed 75 percent of the average brown shrimp harvest from the Louisi-ana gulf. If there was no hypoxia and there was that much more food, don’t you think the shrimp and crabs would be happier? They would certainly be fatter.” The biofuel we are producing solves both the dead zone and oil shortage issues within the United States. Our patented technology allows us to grow selectively bred algae using a filtering process that will allow the chemicals in the fertilizer runoffs to enter the harvesting site in which the algae grows.

The specific individuals we are aiming to sell to are construction managers. Construction managers plan, direct, coordinate, and budget a wide variety of construction projects, including the building of all types of residential, commercial, and industrial structures, roads, bridges, waste water treatment plants, and schools and hospitals. 47% of construction managers have either an associates or bachelors degree in construction science, construction management, building science, or civil engineering. The other 53% of construction managers have worked their way up from being carpenters, masons, plumbers, or electricians, for example—or after having worked as construction supervisors or as owners of independent specialty contracting firms. However, as construction processes become increasingly complex, employers are placing more importance on specialized education after high school. The majority of construction managers are men and the average salary for these workers are $60,650, making them part of the middle class.

Customer Profile

The ideal environment for Emerald Grow would be areas with sunny climates and land used for agricultural purposes. Nitrogen and phosphorus found in fertilizer that runs off into rivers combined with sunshine create the perfect conditions for algae to thrive. States that are primarily agricultural include Tennessee, Kentucky, Kansas, Oaklahoma, and Louisiana; with Louisiana holding the most potential because the Mississippi River channels its ends in Louisiana. It is also a state where there are many urban and suburban areas where our target customers dwell. Having Emerald Grow within this area of the states would help the growing population by supplying alternative resources, reducing air pollution, and cleaning up water ways.

The potential customers of Emerald Grow are construction companies and biodiesel distributers located in Louisiana. There are 25,877 building and construction companies and 21biodiesel distributers that we can potentially sell our fuel to. The prices of biodiesel do not fluctuate and remain consistent, allowing construction companies to have better predictions of their financial projections. Also, our sustainable product will give our customers tax deductibles.

Demographics

Geographics

54%46%

50%

33%

17%

14%

55%

31%

gender of contractors

malefemale

level of education

high school diplomacollege degreesome college

Income

$20,000-$50,000$51,000-$81,000$80,000+

Competitive Analysis

Comercio is a company in Brazil that grows sugarcane in order to produce ethanol. The reason why there is low energy consumption in the production of sugarcane fuel is the result of exploitation of farmers who work long, physically demanding hours, planting and harvesting sugarcane by hand. Although Comercio is creating a green product, their methods aren’t exactly environmentally friendly because its crops are being harvested by tractors running on diesel fuel which emit carbon dioxide and a lot of other green house gases. In addition, importing sugarcane fuel from South America to the United States requires several forms of transportation including trucks, boats and planes; all producing an excess amount of pollution.

POET, a company in the United States also uses manual labor in the production of their corn oil, but because of worker regulations, farmers are treated more fairly. Tractors and other vehicles that are used in POET’s harvesting process use ethanol themselves, cutting green house gas emissions drastically. Since POET plants are already located within the United States, exporting the corn fuels won’t exert as much pollution as Comercio.

Our company, Emerald Grow, produces a biofuel from a bacteria known as algae. Algae practically grows on its own, so manual labor is at a minimum, requiring only routine check-ups and feeding as opposed to the long process of farm work. Our algae is grown in tubes, so tractors aren’t needed to harvest at all, cutting those possible green house emissions completely. Like POET, we are located in the US so exporting our fuel around the nation creates less pollution than Comercio would. Our company’s trucks used to distribute also run on the algae fuel it produces.

Pollution EfficiencySugarcane oil has already replaced 50% of Brazil’s gasoline, but the rise in the demand of this fuel also increases the demand of land used to grow sugarcane, threatening plant diversity and upsetting the natural balance along the Amazon. Producing an average amount of fuel requires a vast amount of land because one acre of sugarcane yields only 500 gallons of oil. It takes 16 -18 months until sugarcane can be harvested, and can grow for about 6-7 years before a new batch must be grown. At this rate, Comercio can only produce 3,500 gallons of oil within the 6-7 year lifespan of a sugarcane crop per acre.

Like Comercio, POET faces the threat of upsetting nature’s balance by cutting down trees to make room for corn. Also, using corn as fuel leaves less food for our domestic livestock and increases the price of food for ourselves because of scarcity. One acre of POET’s corn can yield only 328 gallons of oil. It also takes about 16-18 months to harvest corn and can grow about 8 – 10 years before a new batch must be grown. At this rate, POET can produce 3,280 gallons of oil within the lifespan of a corn crop per acre.

Unlike corn or sugarcane, Emerald Grow uses algae as it’s source for oil, a bacteria that isn’t used primarily as a food source. Algae can grow practically anywhere and in volumes rather than acres. It also multiplies in size expediently, almost twice it’s size every six hours. Algae can be harvested within just weeks depending on the size of the vessel it is grown in. In a closed, sterile environment, our genetically engineered algae can yield 80% oil. With such a high percentage, we can produce 5,000,000 gallons per year.

Gallons of pollution

0 37,500 75,000 112,500 150,000

Gallons of oil per acre

0 1,250,000 2,500,000 3,750,000 5,000,000

Water used to grow (Gallons)

0 25,000 50,000 75,000 100,000

POET Emerald Grow Commercio

Marketing Plan

Emerald Fuel is made completely from Algae, a clean and natural energy source for our environment that could potentially help deal with the problems of oil scarcity. Unlike other bio-fuel companies thats use up land and release harmful chemicals into our water, Emerald Grow uses these harmful toxins to fertilize the Algae. This cleans up the environment from hazardous environmental situations like the dead zones along the coast.

Diesel fuel is a commodity that sells at a fluctuating price that depends on quantities of supply of the fuel and other factors such as time of year, technical innovations and the overall economy. The overall price for biodiesel is also dependent on the vegetable oil market since this is the primary source for mass produced biodiesel. Currently the market price for biodiesel fuel is fluctuating around $82 per barrel. We expect to be able to make a sizable profit if prices for diesel stay near this level and since we control all factors of productions, we are able to sell our fuel for $80 per barrel.

Emerald Grow will be storing its fuels in large storage tanks. In our business to business transactions, biodiesel distributers will come to our tanks to fill up their trucks and then divide it amongst their diesel running vehicles.

Our customers will be mainly drivers with diesel-powered vehicles. To get the message across to our customers that Emerald Fuel is the cleaner option of biofuels, our product will be promoted through large weekly magazines such as “Time Magazine” and “National Geographic” to catch the eye of those interested politically, economically, and environmentally. We will also promote our fuel on billboards and mobile billboards, providing truck-side advertising for a more broad range of promotion. The trucks that transport our fuel will display our advertisements.

Product

Price

Placement

Promotion

Financial Projections

The oil industry is receiving significant attention because of different scenarios such as the war in the Middle East and the recent BP oil spill. One third of the world’s fossil fuels has already been consumed with US using 20 million barrels a day. Research shows that biodiesel will be the only option feasible, and if made mainstream, consumers would purchase our biodiesel because of its convenience and sustainability. Many companies such as construction sites and delivery services depend on fuel to operate. It is important for them to be able to predict the costs of fuel they will use annually as part as their operation budget, and with constantly fluctuating fossil fuel diesel, it will be difficult for them to determine those costs. Because we control our factors of production, we can negotiate a contract with these companies and sell our biodiesel at a constant price. This is essential to any fuel dependent company because while diesel prices change over night, our biodiesel contract lets them pay the same price. Emerald Grow uses selective breeding in order to harvest algae that consumes most of the runoffs and yields 80% of fatty oil that can be processed into biodiesel. Because biodiesel is an inelastic commodity, Emerald Grow depends on the quantity of fuel it produces. With our patented technology, we are able to produce 5 million gallons of oil per site per year. This equates to 71,600 barrels of oil per site per year. At a fixed price of $80 per barrel, our total revenue would equal $52 million per site per year. Within the first year, we will operate one site in order to test run our technology and fine-tune it so that we can yields as much oil as possible. Once this infrastructure is established, we will be adding to the number of sites in order to provide exponential growth. We are expecting to expand by 75% each year. By year two, we will have 3 sites and produce 150,000 barrels of oil. This production level will continue to escalate and by year 5, we will have 16 sites and will produce 825,000 barrels.

0

225000

450000

675000

900000

2011 2012 2013 2014 2015

Product Projections (barrels)

Sales and Revenue Growth

Earnings Projection - Five YearEarnings Projection - Five YearEarnings Projection - Five Year2011 2012 2013 2014 2015

Revenue (price x units)

$6,000,000 $12,000,000 $24,000,000 $42,000,000 $66,000,000

Operations (fixed costs)

$18,600,000 $12,200,000 $8,520,000 $7,200,000 $9,600,000

Cost of Goods (variable costs)

$600,000 $1,200,000 $2,400,000 $4,200,000 $6,600,000

Wholesale Price $80 $80 $80 $80 $80

Production Units (barrels)

75,000 150,000 300,000 525,000 825,000

Profit Margin (revenue - costs)

$13,200,000 $1,400,000 $13,080,000 $30,600,000 $49,800,000

Total Earnings $13,200,000 $14,600,000 $1,520,000 $29,080,000 $78,880,000

1 2 4 7 11

Earnings Projection - First YearEarnings Projection - First Year Q1 2010 Q2 2010 Q3 2010 Q4 2010

Operations (fixed costs)

$590,000 $930,000 $410,000 $570,000

Cost of Goods (variable costs)

$300,000 $600,000 $1,200,000 $2,400,000

Wholesale Price $80 $80 $80 $80

Production Units (barrels)

5,000.00 10,000.00 20,000.00 40,000.00

Revenue (price x units)

$400,000 $800,000 $1,600,000 $3,200,000

Profit Margin (revenue - costs) $490,000 $730,000 $10,000 $230,000

Total Earnings $490,000 $1,220,000 $1,230,000 $1,000,000

For the purpose of this project, it is assumed that the cost of operation for our company compromises 85% of our revenue and is composed of the following individual items:

• Research and development• Refinery• Storage tank lease• Land lease in Louisiana• Salaries

For the purpose of this project, it is assumed that the cost of goods for our company’s product compromises 10% of our revenue and is composed of the following individual items:

• Transportation• Harvesting materials• Labor and management

Operation Costs

Cost of Goods

Advertising & Marketing ExpensesFor the purpose of this project, it is assumed that the cost for advertising and marketing expenses compromise 30% of our revenue. We will place our ads on our transportation vehicles. It will cost $700 per truck advertisement and the total cost varies depending on how many transportation vehicles our company will use. In addition to our mobile advertisements, we will place ads on billboards. It will cost $300,000 to place 10 billboards within large cities where our target customers reside per year. Magazine ad placement in National Geographic costs $450,000 per page per year. This will equate to $1 million dollars for the first year. As the years go by, revenue spent on advertising will decrease as public recognition increases.

Life Cycle Analysis

The glass tubes used to harvest Emerald Grow algae are made overseas and shipped to the US. The labor required to work the tubes and machinery isn’t as demanding as other biodiesel companies, and our company abides by strict working condition laws. Growing the algae in a contained environment is a sustainable practice because it saves the oceans from hypoxia and turns that potential danger into an energy source.

As do all refineries, the Emerald Grow refinery has a range of environmental issues including water and air pollution. However, there are some key factors that allow Emerald Grow to be more sustainable. Along with nitrogen and phosphorus, algae needs carbon dioxide in order to grow. As it undergoes fermentation, the carbon dioxide producing during this process can be recycled instead of being emitted into the atmosphere. Our refinery also uses a fraction of its diesel to power it, reducing heat and electrical energy consumption by 19-31%.

When any thing is transported, whether by truck, train, plane or ship, an energy source is needed. The green house gases that are emitted by the burning of the fuels are bad for the environment and it does not make a company look good on the environmentally friendly side. In order to ensure maximum sustainability, our shipping trucks will run on the fuel we produce.

Emerald Fuel is an all natural energy source that does not harm the environment with toxic pollution like regular petroleum does, so there is also no harm done to human health when they are intact with our diesel. Our bio-diesel when in use burns more cleaner and is more efficient in mileage compared to petroleum. The fuel is disposed of when in use, and when algae fuel burns, it emits less harmful emissions compared to regular diesel. In the process of producing our fuel, the algae consumes carbon dioxide, so when vehicles burn our fuel, the carbon dioxide is recycled. The carbon dioxide emitted equals the carbon dioxide used to produce.

Acquiring

Manufacturing

Transporting

Using & Disposing

Acquiring Manufacturing

TransportingUsing & Disposing

+

Promotion

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