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APPARITIO

Makes Life Easier

John OMalley
Chief Executive Officer
Ian Catalano
Chief Operating Officer

John Rafferty
Chief Marketing Officer
Martin Valladares
Chief Financial Officer

Executive Summary
Apparitio was formed in 2015 by its founding members Ian Catalano, John OMalley,
John Rafferty, and Martin Valladares. These four developed an extensive knowledge of how to
succeed as entrepreneurs while under the tutelage of the legendary professor Edward
Papabathini. The premise behind Apparitio was to connect users to local businesses via an easyto-use platform that would enable consumers and businesses to connect with one another and
schedule appointments with just a couple clicks of their mouse. However, Apparitio evolved
beyond this core idea, and became the first electronic service marketplace to develop an
interactive app through which users could find the perfect business to meet their specific needs
and set up an appointment.
In the service marketplace industry, the competition is fairly tame. There are only a
handful of notable competitors, none of which has a significant amount of market share or a
mobile app through which customers can access them. The electronic service marketplace
industry is also growing exponentially each year, as more and more companies move towards
doing business through electronic mediums. We are moving toward an age where people can and
want to do pretty much everything on their smartphones, whether it be ordering a pizza or calling
a cab, and by being the first service marketplace to introduce its own mobile app, Apparitio is
getting ahead of the curve.
Presently, Apparitio connects users with businesses under three main categories: snow
removal, landscaping, and household cleaning. While this provides us with plenty of
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opportunities for business, we may expand into more categories as time goes on, depending on
market outlook and financing feasibility. There is also a Miscellaneous section of Apparitio
that allows approved users to post individual job tasks they are willing to complete.
The benefit to using Apparitio as opposed to a similar electronic service marketplace is
the convenience that it comes with. Not only does Apparitio allow customers to use their phone
to find their ideal business, but it has also streamlined the service scheduling process, in a way
that makes scheduling an appointment with a business as easy for the customer and efficient for
the business as possible. That is what we strive for at Apparitio, combining easiness with
efficiency in order to reach our objective of optimal customer satisfaction.
Our financials projections show that in year 1, with sales of $183,500, we see a negative
$99,345 net income due to start-up expenses that exceed our operating profit. By year 2,
Apparitio will have a net income of $13,152, with sales coming in at $195,428. In year 3, net
income slightly grows to $14,235, with sales at $209,107. Gross sales to our service providers,
before Apparitios portion of the sales, exceeds $1,350,000, which shows the market size and
demand for these services. Projections show that our users will increase from 1,250 in year 1 to
1,850 users in year 2, and by year 3 we will see an increase to 3,175 users. With over 115,000
students in Chicago alone, we know there is a vast market to expand our application to on a
national level to all universities and colleges around the United States.
Apparitio is proposing a 35% stake in our firm for $500,000 from an Angel Investor to
help us grow and expand nationally, who will receive their portion of dividends and profits
throughout his tenure of the investment stake in the firm. With the investment in Apparitio, we

will improve our application and servers to handle the additional users, hire additional staff, and
a portion of the funds being used to market and promote our app in new markets.

Table of Contents
Executive Summary

1-2

The Industry and Company


4
Product/Service
4-6
Market Research and Analysis
6-7
Overall Marketing Strategy
7-9
Development Plan/Design
9-11
Operations Plan
11
Management Team
11-12
Critical Risks and Problems
12-14
The Financial Plan
14-18
Projected Income Tables
14
Profitability Ratios
17
Proposed Company Offering
18
Works Cited
19

The Industry and Company


Presently, the service marketplace industry has a fairly open playing field, with only a
few competitors, none of which has a real grip on a substantial amount of market share. These
competitors include TaskRabbit, Zaarly, and Job Runner. At the same time, none of our
competitors have developed an app that streamlines the process of scheduling and paying for
services. If these companies were to try and mirror our strategy and create similar apps, it could
prove to be problematic for us. However, at this time, it is our biggest advantage over our
competition and by further improving and developing our app, we stand the best chance to
improve our market share and attract new customers. We believe that the service marketplace
industry has loads of untapped potential, and by providing customers with an easy and efficient
way to schedule a service, we should begin to realize some of that potential in the near future.
Led by a stellar management team of some of the most hardworking individuals around, we
expect Apparitio to make great strides in expansion over the next five years. We currently only
operate in the greater Chicagoland area, but plan on expanding to other markets, such as
Milwaukee or Detroit, before long. As we continue to expand, our list of registered users will
multiply exponentially, which will lead to increased interest from local businesses. As a result,
greater competition within our own marketplace will develop, something Apparitio users stand to
benefit greatly from.

Product/Service
Users can access the Apparitio service marketplace through our website Apparitio.com or
by downloading the Apparitio app. Before they can proceed, users must first set up an account

with us and have a credit or debit card on file. They may then choose from one of our four
categories of services: Landscaping, Snow Removal, Household Cleaning, and Miscellaneous.
The first three categories will connect them with select local businesses we have contracted,
while the Miscellaneous category will direct them to a list of independent tasks where
individuals will post job listings such as Lawn Mower Repair Specialist and the price they are
willing to do the job for. Only approved individuals may post jobs under the miscellaneous
category, and anyone who wishes to do so is subject to an in-depth background check, and must
prove that they have not been convicted of a crime at any point in the last ten years. While the
Miscellaneous category provides us with the potential to access a variety of niche markets, the
majority of our business will be done through our business-categories, Snow Removal,
Landscaping, and Household Cleaning.
If a user selects one of the first three categories, they will be directed to a long list of
businesses from that specific category. From here, the user will have a number of different ways
to filter their results. They may filter by average user rating (1 to 5 stars), price of the service,
distance from current location, and schedule availability. After they have selected the business
that is an ideal fit, they will be directed to a list of job descriptions and corresponding prices that
the business offers to choose from. These job descriptions will include a number of various
services the company is willing to provide. For example, a household cleaning company may
offer different options such as clean house or clean apartment and have different prices for
each corresponding description. At the same time, a landscaping company may offer different
options as basic as mow lawn and as complex as mow and fertilize lawn, trim bushes, remove
weeds. This is designed to give both the consumer a variety of options and the business the
opportunity to appeal to a number of needs and price ranges. When the user finds a description

that fits their specific needs, they will be given a list of available times and can choose the one
that works best for them. Once they have completed these few easy steps, the user must simply
hit the Confirm button and just like that, theyre in business. That is what makes Apparitio so
unique and innovative, the easiness with which it allows customers and service companies to do
business with one another.

Market Research and Analysis


Every successful business has competitors. After doing extensive research on the market,
we found that there are several other companies that outsource tasks and jobs; companies like
Taskrabbit, Zaarly and Job Runners are all competing with us. While, these companies may have
greater knowledge of the industry because they have been in business for longer, what separates
us from the competition is our mobile app that is quick and easy to use. In order to be successful
in the sharing economy, you must make service simple and efficient for your customers.
Secondly, our competitors only outsource their work individuals. Apparitio, on the other hand,
will seek out credible, regional businesses that have a proven track record. This market is only
going to get bigger among businesses and we plan on taking advantage of it.
The sharing economy is growing faster than ever. A 2010 survey by Intuit forecast that by
2020, 40 percent of the workforce, or 60 million Americans, will be doing some kind freelance
work, up from the current estimate of 33 percent. Established companies in older industries
continue to outsource what were formally full-time jobs. Also, the sharing economy is allowing
many people to supplement their current incomes, or make a full-time job out of part-time work.
Under our miscellaneous section of services, we will hire freelance workers to perform tasks

such as dog walking, grocery shopping and errand running, which we will then take a 20% fee of
the revenues.
In the sharing economy, its not the idea of sharing that is new because people have been
doing that for years. Whats different now is the introduction of technology particularly easyto-use digital technologies that allow people to quickly make and respond to requests for goods
and services. One of the great things about Apparitio is we are a mobile-app based company. The
growth and prevalence of new mobile devices means people can make on-the-fly market
transactions. Since consumer willingness to try mobile apps has grown, there will be lower
barriers to entry when it comes to building brands and scaling up quickly. Innovation will
continue to grow faster as consumers become more trusting of relationships tied to community of
users. This is what separates us from our competitors. All of our competitors are online-based
companies, which means customers have to actively seek out their company online and order a
service. Apparitio, however, will offer customers the option to use their mobile, meaning they
wont require our customers to be near a computer at the time of the transaction.

Overall Marketing Strategy

Marketing is one of the most important aspects of growing a successful business. We


have come up with a carefully planned marketing approach and strategy that will help expand
our markets. To start off, our target customers will be college students, recent retirees, stay-athome moms, young professionals or any household that is short on time for doing chores around
their house. Since we do not want to spend a lot of our initial budget on marketing, our
marketing plan will be simple and efficient. We will start out by focusing on hyper-local

universities in Chicago. We aim to spread company awareness through word of mouth between
students. This is not only an effective method, as recommendations are more worthy as a
marketing tool, but will also cut down on cost. Another aspect of our marketing strategy will be
social media presence. Having a social media presence is a fundamental aspect in getting others
to use our company. We plan on recruiting college students to be our social media brand
ambassadors. Our belief is that we can turn students into brand ambassadors which will lower
advertising and customer acquisition costs. By using this marketing strategy, we will save money
to use for other operations within our company.
Our market penetration approach is simple. We need to establish ourselves in our home
city of Chicago and throughout the university system here. There are four major universities
around Chicago which we will target. DePaul, Loyola, Northwestern and University of Chicago
will be our initial target market. Once we establish ourselves financially, we will then expand
into different hyper-local university markets, such as New York and Los Angeles. Each target
customer can be very profitable. For example, we know that there will always be a demand for
various clean up jobs in colleges and college students can be a great marketing tool alone. Our
reputation will spread through word of mouth around campuses and we will capitalize on that by
enrolling more customers and ambassadors. Another great thing about our company, is that
college students will make for great part time miscellaneous employees. This is true because
college students are always ready to work for quick, easy money. Once they pass a background
check, they will be free to enter our company market as general contractors performing various
tasks and making money in the process.

Our main money making services will be house cleaning, landscaping and snow removal.
Housecleaning services will be a huge success, especially in universities. Colleges are notorious
for having outlandish parties which usually result in unsanitary, messy houses and apartments.
Thats where we come in. Once someone uses our app, a cleaning service crew will come to your
location and clean the premises to your liking. Depending on the size of the house or apartment,
prices will vary, but we will collect 10% of that transaction. Customers will essentially be the
employers of the companies we partner with. After each task is completed, the customer will rate
the job done by the company based on a five-star system along with additional comments and
concerns. This will help our company eliminate complacent employees and reward the better
ones.
To be clear, we are using colleges and universities as an intermediary to grow our market.
Weve concluded that this will be the most financially sound way to market our business initially.
Once our company reaches new markets, the emphasis on different services will change. We will
then partner with local, trusted businesses to complete tasks for the needs of our customers. For
example, if a retiree couple needs their snow removed during the winter, they will simply use our
application to select a company or individual to complete the task. We give our customers
options as to who they want to employ. We understand that some of our services will be used
more by different market segments than others. That being said, we will cater our marketing
approach differently depending on the customer and with the help of a high. We can also utilize
data analytics coming from our app to better cater these marketing approaches.

Development Plan/Design:

As of today we are projecting great success over a short period of time. It is very
common for a company to not have profits in the beginning quarters of any new business
venture, and based on our analysis our company will be making money after just two years. As a
whole, we need to focus on the value chain of Apparitio and in what ways we can create value
and assess what we need to improve upon. By studying the service we are able to determine in
what ways we can create additional value and if we have the means to do so.
Apparitio will focus primarily on expanding its market and creating a brand image, we
will do this by finding celebrity endorsements and having more of a voice for our company. As
of right now money isnt a huge issue and we already have investors calling wanting a piece of
our company. With these acquired funds we will create a brand name and image that will attract
future business and help our company grow even further. We will be using the value chain
analysis to assist in identifying opportunities for new emerging clients. We pride ourselves in
having a easy and extremely useful app that will be hard not to take advantage of once you
become a regular user. Some difficulties we plan to encounter, is setting up extensive background
checks to reduce liability. A huge issue that may come up are injuries while working, this wont
be an issue when we set up contracts with outside businesses for their services, but specifically
focusing on the job listings we will allow members to post. We will be required to provide
insurance since we will be making money off the service provided. Our staff will develop a
detailed terms and conditions to prevent lawsuits that will damage our company because it will
allow opportunity for negative publicity on our brand name as well as detrimental financially.
For the service we will be contracting out in our big three services we will be making 10% off
the total cost of service, and for the odd ball jobs we provide through linking members with
workers we will be demanding 15-20% from their fee. This will provide substantial funds and

our projections show profits in just a few fiscal years. A way we will ensure job performance is
by using incentives to increase job performance and job satisfaction for example we will offer
every employee who earns $2500 a visa gift card worth up to $500, we will also make it very
easy for the people doing the work to contact customer service with any questions they might
have regarding pay out structure.
Operations Plan:
Since we are a service and we arent providing any products to our consumer we will not
being having a production process, but we will be having a strict operations plan that we will be
abiding to. We will have a customer service system that is very easy to contact a representative
who will be able to assist in all claims/issues, all claims will be filed and documented and will be
used by our quality control management team. We will be directing our starting marketing plan
to primarily college students, and high income individuals, age ranging from 20-30. Apparitio
has a lot of potential and room for growth, and the students entering the workforce network a lot
and efficiently and we feel it will be the new hot app around the world in no time. Our
operations plan focuses primarily on the development of a functioning website as well as a user
friendly app that is easy to use. Our chief operations officer will focus on the app development
and ensure that everything involving the app and its software are completed and ready to use.
We will be contracting the apps development out and it will be our number one expense,
because we are willing to spend as much money as possible to ensure we have a successful new
app.

Management Team:

In order of importance: John OMalley is our Chief Executive Officer at Apparitio and
everyone is required to report all data/activities to him, Ian Catalano is the Chief Operations
Officer, John Rafferty is our Chief Marketing Officer, and Martin Valladares is our Chief
Financial Officer. Our CEO will be responsible for managing business activities. He will be the
final decision maker, and executor and play the communicator role whether it be in-house or
with the press. He will focus on the making a successful strategy and policy to ensure the
success of our company. Our Chief Operations Officer will focus on directing operations and is
also the President and second in command when the CEO cant perform daily responsibilities.
He will also ensure everything is running smoothly and make sure all daily activities are
functioning properly as well as maintain proper sales management. CMO is responsible for all
marketing activities in an organization, and in our company it is an especially vital position. He
will report all information to the CEO, and work directly to improve our companys brand name
and marketing plan. He will also lead the marketing communications, market research, and
customer service. Finally, our CFO Martin Valladares will focus on managing the financial risks
of the corporation and keeping up to date records of all business transactions. He will be
involved in in-depth risk mitigation to forecast intelligent business moves and possible
investments. It will be especially important for him to analyze data accordingly and give us
accurate projections, which will pay great dividends when we enhance our marketing plan.

XI. Critical Risks and Problems


Providing an application that connects businesses and users seeking landscaping, snow
removal, house cleaning, or other miscellaneous services poses various risks within our industry
and with the overall market, with our business providers, and our users. Risks within the industry

include risks that the market will not demand our application and seek services with a
comparable application. Although our business provides a competitive advantage over our
competitors, a bad experience or a lack of knowledge on our business might have consumers use
a competitors application due to more familiarity with that competitor. A critical risk might arise
if our marketing plan fails to attract market appeal with our target market. In addition, if our
marketing plan does not encompass enough target users, growth for Apparitio might be difficult.
As a startup business, there is always the risk that we will not be successful, resulting in a
dissolution of the business. In our first years, we have negative income, but we have forecasted
by year 2 we will be profitable. One key input in our financial statements are assumptions are
market demand, sales, and operating expenses. If our forecast is incorrect and continue to post
losses, the business will have to reassess its business model and seek alternatives to generate
positive returns.
One risk that may arise during our course of business is that our service providers do not
perform in a suitable and safely manner or fail to perform users required services. In order to
mitigate this risk, we have insurance to cover any incident, compliant, or lack of workmanship
that may arise when businesses perform services to our users. If an incident occurs with any of
our users, our business providers will first have their insurance cover any loss to our users, but if
that coverage does not fully cover the incident or fails to do so, our policy will be used.
Additionally, if users are unsatisfied with the services provided by our business providers, they
can rate the business, which we will assess and remove any low rated business.
Like mentioned above, many assumptions were made throughout our business plan,
including our financial projections. If any expense assumption that was made is greater than
originally assumed, our projections may put Apparitio into an unfavorable financial situation.

Our sales projections were made on assumptions regarding demand of our app, if any of our
projections fail to meet our targets, Apparitio may incur significant losses. On the flip side, if
actual sales exceed our projections, Apparitio will be in a favorable state. To mitigate these risks,
we will compare actual financial information to our assumptions, adjusting accordingly. If we are
facing a shortage of funds due to a deviation of our financial assumptions, we will seek
appropriate financing and attempt to repair the deviation.
The risks aforementioned are difficult to assess before consumers are exposed to the app,
but we will assess ongoing information on the sales, market, application downloads, and user
experience to assess and mitigate these risks.

XII. The Financial Plan


For the three projected years, our net income is negative for the first year. Net income
was negative $99,345, $13,152, and $14,235, respectively for year 1, 2, and 3.
One reason we had negative net income for our projected first year is that our sales are
lower than our operating expenses. Our sales of $177,995 are based on 1,250 users for year 1 and
our operating expenses are $272,213 due to the high start-up costs. Our demand for our app,
along with sales, can been seen in the chart below for year 2 and year 3.

After deducting a 3% cost of goods sold, to remit and process Apparitios portion of the
service provided by our business providers to users, gross income was $177,995, $189,565, and
$202,834 for year 1, 2, and 3 respectively. Total operating expenses were $272,213 for year 1,
$165,925 for year 2, and $177,932 for year 3. In year 1, larger expenses are incurred due to
starting up the business and developing necessary software to provide to our users and put our
app on the mobile platform application stores, such as Apple App Store and Google Play. The
cost of developing the app is $95,000 and total start-up expenses $140,599, which put our net
income into negative territory.
Our operating costs contain large amounts for our advertising, insurance, marketing and
promotion, professional services, rent, and salaries for our executive officers. Although these
expenses are relatively stable throughout the three years, our marketing and promotion expense
varies with the amount of new users to obtain.
We have established a marketing and promotion cost of $1.75 to acquire a new user to download
and use our services, based on current market costs (Perez, 2014). As a result, our marketing and
promotion projections rise each year reaching $14,188 in year 3 when we attempt to attain 3,175
new users. As a result of our presence being better known in year 3, compared to when starting
up in year 1, our advertising budget slightly declines in year 3. For a more detailed breakdown of
the sales and costs, the financial statements are located in the appendix section at the end of the
business plan.
As seen in the balance sheet and cash flow statements, found in the appendix, Apparitio
has a relative high cash balance, but we will need more to continue growing as discussed in the

next section. Total Assets is over $300,000 for each year due to the equity investment that was
injected into the firm at inception and cash from the net profit.
By year 5, a large amount of our advertising budget will decline and be reallocated to the
marketing and promotion budget to increase new users to our application. Our other expenses
will remain relatively constant throughout year 5 resulting in a greater net income for the firm.
A third party software, Intuit QuickBooks, will provide our accounting and control
systems. A local accountant will file our annual reports, file our tax returns, and provide any
accounting service needed. Our control system will allow any officer can make nominal
purchases, but capital expenditures and amounts over $5,000 to be approved by three of the four
officers to ensure proper uses of company funds. A local consulting firm will provide
professional services to help Apparitio with any other control related need or to provide business
services.
Our profitability ratios are negative in year 1 because as mentioned above, our net
income is negative due to high operating expense in the projections. Our Gross Margin ratio is a
positive 97% due to our low cost of goods sold for our services. Our operating margin and net
margin also show that we are profitable and there is opportunity to continue to grow. In Year 2
and 3, our ratios remain relatively stable and can been seen below.

Apparitio is in good financial health in terms of debt and risk of defaulting on its loans.
Apparitios financing structure is $250,000 owners equity and a $150,000 loan. Our assets arent
heavily debt financed and are not heavily aggressive with debt financing, as seen in our 0.49 debt
ratio and .94 debt to equity.
Throughout our financials projections, many assumptions were made in their preparation.
Sales were projected on assumptions made about the number of users and their demand for our
application. Assumptions related to the operating costs of a new company and demand for the
service were created. Assumptions were made from comparable companies and costs to newly
formed app startup companies. For example, bank charges, insurance, licenses and fees, meals
and entertainment, telephone, and utilities were based on current average market costs.
Advertising, bank charges, insurance, miscellaneous, office supplies, outside services,
professional fees, rent, repairs and maintenance, and training and development were assumptions
made that were reasonable for a startup app and the nature of our business. (Chron, 2015, Fast
Company, 2012, Forbes, 2012) As mentioned in the Critical Risks section, if the assumptions

deviate from our projections or if demand is weaker than expected, Apparitio can fall into
unwanted financial difficulties.

XIII. Proposed Company Offering


Apparitios current structure contains $250,000 of debt and $150,000 of equity, to a total
of $400,000. In the near future, we are hoping to raise $500,000 from Angel investors, for
exchange of a 35% stake in our firm, to help growth Apparitio into its existing market. Currently,
after our year 3 projections, we expect to have a cash balance of $298,622. We are seeking a
$500,000 investment to expand our application into new geographic locations around the United
States. The angel investors 35% stake in the firm, will receive their portion of profits and
dividends, throughout his tenure of his investment stake in the firm.
With the additional investment, we will be able to increase our user base and our sales. In
Chicago alone, there are over 115,000 students, which our current users is only small percentage
of the market. Nationwide, there is a large market of students that we will try to attract to use our
application. The investment will be used in improving our app, the servers to handle a larger user
base, and hire more staff. A portion of the investment will be used to market and promote our app
in new markets. With the added investment and investor support in Apparitio, we can grow to a
national presence that will make our application compete with the existing competitors.

Works Cited
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Johnson, Nicholas L. "TaskRabbit Is Trying to Become the Uber for Everything. Here's Why It
Won't Succeed." Mobile App Design & Development Company. N.p., 29 June 2014.
Kokemuller, Neil. "How Much Does It Cost to Advertise a Business?" Chron. N.p., n.d. Web. 3
Nov. 2015.
Maycotte, H.O. "How Big Data Is Driving the Sharing Economy - Power More." Power More.
N.p., 12 May 2015.
Perez, Sarah. "Mobile App Marketing Costs Hit Record Highs In 2013." TechCrunch. N.p., 3
Jan. 2014. Web. 1 Nov. 2015.
Thompson, Mary. "Sharing Economy Makes It Pay to Work on Your Own." CNBC. N.p., 02 July
2015. Web.