university parent, inc. fesehaye abrhaley, michelle dorenkamp, kara grinnell, ryan roth and sarah...
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University Parent, Inc.
Fesehaye Abrhaley, Michelle Dorenkamp, Kara Grinnell, Ryan Roth and Sarah Schupp
April 21, 2004
Product/Service Description
•UPI sells website and magazine advertising to businesses interested in marketing to parents of college students
• UPI produces 3 guides per year for each location
• Guide provides comprehensive information:
• Details on university and surrounding community
• Parenting tips
•Website, www.universityparent.com
Opportunity
$70 million dollar market opportunity 95% of college parents want to be more informed No publication addresses their needs/wants 35 businesses have already purchased advertising in
the 2nd Parent’s Guide to Boulder100% of Fall ‘03 advertisers purchased an ad in the
Summer ‘04 guide
Need
Connecting with students Parents stay informed Money Savings/Ability to plan ahead Convenience/Portability
Parents
Building image Generating revenue
Businesses
Target Market
Parents of…College students/prospective students
Parents who…Visit campusAre involved
Advertisers trying to reach…Middle to upper-middle class adultsWho are typically college educatedWith means to send their kids to college
Test Market Competition
No DIRECT competition Indirect competition
Colorado DailyDaily CameraBoulder MagazineRalphie’s Guide
Competition will vary at every campus
Competitive Advantage
Specialized nicheNo one currently reaches
Proven track recordRelationship with 35 advertisers
DistributionAgreements with university, local businesses
Key Marketing Strategies
ParentsDistribution: campus, hotels, & restaurantsWebLogs
AdvertisersDirect MailRelationship BuildingAwards
Risks
Problem Solution
Duplication by competitors Establish brand, quick national roll-out
Universities uncooperative Contact universities for permission before expanding, Internships
Insufficient ad sales Prove ROI, diversify revenue between national and local advertising
Revenue
Revenue (In thousands $)
Revenue Model50% Print Ad Sales50% Web Ad Sales
Forecast & Growth40% Avg. Growth Rate$12.3 MM Sales in Year 5
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
1 2 3 4 5
Website Ad Sales
Print Ad Sales
Revenue (in thousands) $
Profitability
Net Income (In thousands $)
BreakevenFebruary of Year 2
Cost DriversSalaries & WagesPrinting
-500
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
1 2 3 4 5
Year
Cash Flow
0 1 2 3 4 5
Year
Operating Cash Flows (In thousands $) Year 0
$500,000 from investors
$30,000 from founders
Major uses Expansion
Major Source Increase in ad
revenues
-1,000
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
1 2 3 4 5
Year
Funding
Investment Requirements$500,000 for 35% of the company60% IRRWill fund: hiring of new employees, regional office,
and expansion to DU, CSU
ValuationMarket value of $70 million in Year 5Industry P/E ratio of 17.3.