Montavo, Inc.(fka MTVO)

[dmoinvest]

Montavo Executive Summary
by Montavo on Dec 11, 2012 27 views

Montavo is deploying an advanced marketing & advertising technology solution. The Montavo ad platform offers advertisers the unique opportunity to review a “ad spend to gross profit” ratio gauge ...
More… Montavo is deploying an advanced marketing & advertising technology solution. The Montavo ad platform offers advertisers the unique opportunity to review a “ad spend to gross profit” ratio gauge (the Ad Spendometer) which generates and displays a ROI report of their brick-&-mortar stores (not just their on-line store) sales revenue & profits specifically attributed & correlated to their advertising costs (no other ad network has this capability). This means advertisers know in real-time for every dollar they spend in advertising on the Montavo ad platform, how many dollars came back including brick-&-mortar store sales revenue & profits specifically related to their ad spend.

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Montavo Executive Summary

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1. I KNOW I’M WASTING 50% OF MY AD SPEND BUT WHICH 50%?GET THE FACTS, NOT IMPRESSIONS.Anyone will promise you ad impressions; some will offer you specificdemographics. But, what you really need to know is how many peoplesaw your ad, went to the store and bought your product? With Montavoyou’ll get the only analytics that really count: sales and profitability, directlylinked to who saw your ad, from what properties, on what devices, on whatdate/time and from what location? As Arthur C. Clarke once famouslysaid, “Any truly advanced technology is indistinguishable from magic.”Get the magic, get Montavo!+1 425.747.5500www.montavo.com Do You Measure Up?™
2. Executive Summary Summary of Investment Opportunity •• Revolutionary, indisputable and global value proposition: Perfect clarity for Advertising ROI analysis •• Veteran, seasoned executive team with strong track record of generating substantial shareholder returns •• Proven market with strong CAGR - ~$156 billion (U.S.), $500 billion (Global) annually •• Opportunity is optimized to mobile and online advertising, the fastest-growing segments of the advertising market •• Montavo technology is ideally positioned to take advantage of the latest paradigm shift in TV technology, plus the social TV revolution, and garner a significant share of the largest advertising medium •• Business model re-distributes a fraction of existing ad spending, as opposed to seeking incremental monies or requiring competitive takeaways •• Proven product delivery team •• Critical Distribution and Service Delivery Partnerships What is Your Return on Advertising?Throughout the history of human commerce, marketing has been considered a “soft” discipline, debatably partscience, part art. With the emergence of “big data” and analytics, enormous volumes of real-time data havebeen amassed, crunched and interpreted in an attempt to better understand the relationship between consum-er advertising and the subsequent bricks & mortar purchase behavior.eCommerce models bridged this gap, but only for the 15% of consumer spending that results in an online pur-chase. For the 85% of consumer spending, driven by online and TV advertising, that concluded with an in-storepurchase, the task has been impossible, until now.U.S. Advertising Spending by Media Type ($ millions)Media Type CAGR 2013 2014 2015 2016 2017Mobile Advertising 22.09% $4,200 $5,400 $7,100 $8,200 $9,700Internet PC Advertising 13.70% $34,300 $38,490 $42,935 $48,839 $54,755Print Advertising -10.74% $19,677 $18,103 $16,293 $14,338 $12,330TV Advertising 2.5% $71,968 $73,767 $75,611 $77,501 $79,439U.S. Totals 5.43% $130,145 $135,760 $141,939 $148,878 $156,224The phenomenal growth of mobile technologies in general, and mobile and digital advertising, specifically, isunlocking an array of opportunities that did not exist five years ago. U.S. spending on digital advertising is fore-casted to grow to more than $74 billion in 2017 at a CAGR of nearly 15%. At the same time, and driven by theconvergence of networked devices and TVs, new modes of content consumption on as many as five classes ofdevice, will continue to drive TV advertising as a critical medium, reaching nearly $80 billion in 2017.According to Jonathan Alferness, director of product management-mobile ads lead at Google, “One thingthat has to happen is a better understanding of when mobile is driving sales in-store … That’s the holygrail”. Montavo will deliver this Holy Grail.Company Confidential Page 2 of 8
3. Executive Summary The Montavo Ad Platform:Closing the Loop from Advertisement to the In-Store SaleMontavo’s flagship product is a cloud-based, closed-loop advertising analytics platform that provides market-ers with the definitive data to correlate their ads with the actual sales of products and services, in a bricks andmortar location. Using patent-pending technology, the Montavo ad analytics platform provides advertisers witha detailed understanding of which consumers, seeing which advertisements, from which advertising proper-ties, on which devices, respond by purchasing in-store.Chief Marketing Officers can now enjoy a real-time view of the impact of offers, advertising campaigns andother promotional activities. From a simple dashboard, the cost of advertising can be mapped against bricks-&-mortar revenue, or channel costs and COGS can also be factored to show the true ROI of media ad spend by channel, outlet and product. Empowered with conclusive, end-to-end data from the Montavo ad analytics solution, marketers are finally able to identify and elimi- nate the non-productive (wasted) portion of their advertising spend. Montavo- powered marketers can focus their advertising investments on proven campaigns, increasing their impact and optimizing the return on their marketing dollar. The Montavo ad platform is targeted to marketing and advertising management at manufacturers and retailers, from global brands to SMBs. In the earliest phases, Montavo will focus on national brand retailers and national brand manufacturers. Surrogate advertising buyers including ad agencies, their media planning and buying groups, and the advertising networks themselves will also benefit from embracing a media program that delivers definitive performance results, differentiating their offerings from competitors.Empowering Advertisers to Demand Better Ad PerformanceThe Montavo ad analytics platform provides the infrastructure to seamlessly correlate advertising events withretail in-store sales. Reconciliation of Advertising to Consumer Devices Our platform enables the advertiser to correlate a single view of their advertisement to specific consumer devices including smart phones, tablets, laptops and TVs. Association of Devices to the Specific Consumer Through a number of proprietary techniques, Montavo is able to match these consumer device(s) to the indi- vidual consumers that viewed the advertisement. Reconciliation of Purchase Transaction with the Consumer Using a series of patent-pending correlation techniques and inference algorithms, Montavo anonymously matches the in-store sale transaction to the consumer ad view. Analytics and Delivery of “Closed Loop” Data This vital data is delivered to the advertising client’s desktop via our Ad Spendometer™, a sophisticated dashboard providing key performance indicators (KPIs) that calibrate advertising costs against gross revenue and profits.The Ad Spendometer immediately highlights unprofitable advertising spending, enabling the ad buyer to elimi-nate underperforming properties and/or creative strategies that aren’t working.Company Confidential Page 3 of 8
4. Executive Summary ? UPDATES AD CLIENT DASHBOARDS ? PLACES AD MONTAVO AD CLIENT ? CREATES ANALYTICS ? DISTRIBUTES AD Push Ad Network Pull Ad Network WEB SITES APPS TV AD SEARCH SHOPPING APPS ? DELIVERS ADS ? SEES AD ON TV ? SEES AD ON PHONE 2:21PM Friday 9:05AM Saturday ? PURCHASES BIKE In-Store - 11:44AM SaturdayCompany Confidential Page 4 of 8
5. Executive Summary Go-To-MarketAdvertising EcosystemThe market for Montavo’s services is highly concentrated and can be readily leveraged. The primary segmentsin our ecosystem are: Advertisers Buyers of advertising including national/global brand manufacturers & retailers, and small and medium businesses (SMB’s). 90% of major national brands have a relationship with one of the top five media advertising planning and buying groups. Montavo sells advertising inventory directly to businesses in this category. Ad Properties Companies in this category sell their own ad inventory, directly to ad- vertisers or through aggregators. This includes web property owners, app developers and single-property TV media companies. Montavo may trade with these companies as an ad aggregator, as a wholesale technology supplier or as a combination of the two. Ad Aggregators This category includes Ad Networks, Ad Exchanges, and Television media companies whose principle role is the packaging and sale of advertising inventory from multiple Ad Properties, to Advertisers and their media planning and buying groups. Montavo sells our ad technology to these businesses in a wholesal- ing model that enables them to offer a new class of analytic service.Strategy Phase 1 - Initial Beachhead, Direct to Ad Clients In our first market phase, Montavo will act as its own ad aggregator in order to offer advertising inventory directly to our early adopter advertising clients. We will focus on recruiting national brand retailers through a direct sales model. We anticipate this phase to drive our initial year of sales and provide us with sufficient traction to leverage an incremental wholesale business model. Phase 2 - Additional Wholesale Technology Distribution With a small number of national brand retailers and manufacturers on board, Montavo will be truly disrup- tive to the existing global advertising eco-system. As prominent advertisers begin to demand Montavo-en- abled and branded advertising programs from the Ad Aggregators, we will aggressively license our technol- ogy to these companies. As we present no incremental cost to the advertising client, and represent the exact same ad properties, why would an advertiser ever accept an advertising program that didn’t offer instant visibility to advertising ROI for in-store sales and their profitability? Through a series of highly-leveraged business development activities, we will license our technology service to the major advertising and TV networks on a white-label basis. This wholesale business will establish the Montavo brand as the new global minimum standard for ad spending, and the concept of “Powered by Mon- tavo” will become a viral market force in the global advertising industry. Monetization Strategy The Montavo business is divided into two separate models: (i) a direct sales business where advertisers purchase advertising inventory directly from Montavo; and a wholesale business where Montavo’s solution is “embedded” as a privately-labeled feature in existing Advertising Aggregator’s or Ad Property owner’s reporting and analytics. Montavo revenues are a percentage of net advertising revenue based on media spending and vary by ad type (push vs. pull, mobile Internet vs. wired Internet, or TV, etc.) In every case, our revenue is derived from existing advertiser spending.Company Confidential Page 5 of 8
6. Executive Summary Competition & DifferentiationThere have been other attempts to provide similar capabilities, none of which have resulted in a sustainable/viable market offering. Many of these efforts have been based on techniques that are deemed inappropriateby the advertiser, raise privacy concerns or are inconvenient and thus not adopted by consumers. These othertechniques have included the requirement to: •• Incorporate coupons in a campaign •• Utilize personally identifiable communication •• Utilize QR codes capabilities including in-store scanning devices, •• Manually supply a promotion code Wi-Fi, Bluetooth, cellular, or RFID •• Register the end-user’s personally identifiable •• Change fundamental consumer behavior information •• Re-train store personnel •• Implement specialty hardware/software at the •• Use a specific payment capability including point-of-sale digital wallets and mobile payment systemsMontavo’s primary competitive advantage is in delivering the most powerful analytics in advertising withoutmodifying the essence of consumer behavior or the business practices of the advertiser. Today, we are unaware of any com- CLOSED-LOOP AD ANALYTICS pany attempting to implement simi- lar capabilities to those of Montavo. Because of the scale of the chal- lenge, it is unlikely that we will see a cluster of start-ups attempting to enter the space. We have identified four segments from which competi- VISION tion may arise: Digital Coupons – that deliver redeemable discount coupons captured at the point-of-sale. This category includes newer companies like Infinian, as well as old-world coupon leaders like Valpak. EXECUTION Advertising Networks – that aggregate advertising “real estate” and re-sell to advertisers. This includes companies like Google, Facebook, Microsoft Media Network, Yahoo!, InMobi, Millenium Media and Adknowledge. Advertising Analytics - that provide benchmarking data for traditional and digital advertising properties. Leaders include Comscore, Adobe, Flurry and Nielsen. Advertising Technology – that offer a variety of technologies to enable different forms of advertising or automate the management of campaigns. The category includes companies like Marchex, AdRoll, Datalogix and BlueKai.Company Confidential Page 6 of 8
7. Executive SummaryBarriers to entry •• Inability to resolve consumer device ownership within current privacy laws and without requiring consumer consent •• Lack of experience and expertise in integrating with advertisers’ back-end retail operations •• Lack of experience and expertise in integrating with payment networks •• The development and application of correlation and inference algorithms required to match advertising impressions with in-store, consumer purchase transactions •• Lack of experience and expertise in enterprise systems design, development and deployment Funding Requirements & Use-of-FundsCurrent Round – Service LaunchThe company is currently completing a $1,000,000 funding round.$500,000 has been secured to accomplish the following goals: •• Completion of a minimal viable product (MVP) – Release 1.0 •• Deploy the solution to a single retailer •• Integration with a single payment gateway providerAn additional $500,000 will be used to: •• Hire the minimal team to launch the service in Summer of 2013 •• Contract with a minimum of 3 additional national brand retailers with deployments to follow in Q3 2013Subsequent Round– July 2013 – Market ExpansionThe company is seeking $15mm in funding to support the primary sales, marketing, business development andcustomer service programs to secure a strong beachhead with manufacturers, retailers and advertising inter-mediaries. Core milestones include: •• Release version 2 of the product •• Generation of $2 million in revenue •• Contract with 10 new advertisers •• Secure advertising inventory from 30 property owners •• Develop wholesale business and recruit 10 ad networksCompany Confidential Page 7 of 8
8. Executive Summary The TeamManagement Brook Lang, Founder & CEO - seasoned executive from Sony, T-Mobile and numerous entrepreneurial start-up companies with a strong wireless sales background. Steve Moore, Strategic Advisor/Investor - interim Chairman and CEO of Contour, formerly CEO of WatchGuard, key roles at The Boeing Company, private technology investor, board advisor to AdmitOne, n2 Systems, IntellectSpace. Torsten Kablitz, CTO - former Chief Architect at CoreConnex and CTO of Zynchros, architecture & development assignments with Microsoft. the Port of Seattle and Amazon. Bob Pinkerton, CMO - former President/COO of Zynchros. Executive marketing and operations roles at start-ups including WatchGuard, Networx, Saros and Motiva.Expert Advisers and Contracted Service ProvidersThe company is committed to developing a network of contractors, consultants, advisors, board advisors, andother experts to leverage our core competencies with specialized expertise. We are actively soliciting relation-ships with a range of entities and individuals to provide technical and market expertise that can shortcut anylearning curve. Doug Chartier – Wireless Providers and Retail - T-Mobile and AT&T Gunnar Wilmot – Advertising & Marketing – Gotham, Inc., Interpublic, McCann-EricksonCompany Confidential Page 8 of 8

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Folks need to review the Executive Summary in close detail to understand what has, is and will be possible. Cross reference dates (of earliest events, signing and release) and 8K's to try and make sense of timing of releases, disclosures, etc. Look closely at the funding required (highlighted), moving forward.