Executive Summary November 30, 2012 Connecting the causes you care about with the places you shop . . .
Executive Summary
November 30, 2012
Connecting the causes you care about with the places you shop . . .
Consumers want to support causes that matter to them via
their day-to-day purchases
. . . of Moms want to “Buy a product in which a portion of sales goes to the
support of the cause or issue”
. . . of Moms are likely to switch brands for a product or company that
supports a cause they care about
. . . of consumers would be willing to travel 11 minutes to go to a specific store
to purchase a product that supports a cause they care about
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92%
93%
70%
Sources: The Cone Cause Evolution Study, 2010; The “Do Well Do Good” Public Opinion Survey on Cause Marketing, 2010
This trend is clear
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Our platform brings this to a local level
“Scrip” and “daily deal” models allow consumers to support
causes/schools through their spending – a $15B industry
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Existing models . . . . . . shortcomings . . . We have a better solution Small percentage of sales goes to causes
(4% or less)
Traditional scrip focuses on nat’l retailers who place little value on acquiring local customers
Some do not acquire new customers but only track existing ones – limited value to merchants
Promoting, selling and tracking of cards is a lot of work for causes with little return
The user experience is poor and often results in breakage (10-25% of cards/coupons go unused)
“Daily deal” sites do not create customer loyalty
Focus on new and loyal customers
Higher value to Merchants
We eliminate cards and breakage
A better User Experience
More than 3-4X improvement
Greater return – less effort for Causes
Leverage mobile technology
Additional revenue streams
“Communities for Cause” connects Causes, their Supporters
and Local Merchants
Participating Merchants are promoted within the cause membership and, in
return, donate a percentage of associated sales
Local Merchant
Cause Supporters
Merchants offer a donation as a percent of each sale
Causes promote local merchants to their members
Supporters shop with local merchants to earn donations
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We retain 20% of donations as a processing fee
How it works
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Find offers by category or location
1 Register your purchase as you shop
2
See your efforts making a difference
4 Confirm donations with a QR code
3
We made notable progress in a very short time
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Timeline
• Nov. '11: Company formed • Dec. '11: Beta product (iPhone) • Jan. '12: Pilot launch with 1 school • Mar. '12: v1 Product (iPhone and
Android) • Mar-May ’12: Initial rollout across
memberships in Orange County
Causes – Partial List (70+ represented in Orange County Area)
Education • Irvine Public Schools Foundation
(all 32 public schools in Irvine) • The Pegasus School • Huntington Beach Educational Foun. • Kaiser Woodland Schools Foun. • Fountain Valley Educational Foun. US Armed Forces • The Injured Marine Semper Fi Fund
Medical • American Red Cross • Beckstrand Cancer Foundation • Cure Duchenne • Leukemia & Lymphoma Society • Moving Hearts Foundation Youth Development • YMCA Newport Mesa • Big brothers, big sisters
Merchants – Partial List (120+ represented in Orange County Area)
Restaurants • Pascal • Café Jardin • Chili’s • Jersey Mike’s • Wingstop • Roundtable Pizza • Lamppost Pizza • Red Brick Pizza • Subway • Zpizza
For Kids • Mathnasium • Pump it up • 5 Seas for Kids • Music and the Arts for Kids • Studio Fusion Snacks and Treats • 33 Degrees • Juice it Up! • Baskin Robbins
For Moms • Lugano Diamonds • Armando – A Joshua
Christopher Salon • Nails by Kim • 5 Seas Boutique • Verbania Boutique Sports and Recreation • Two Wheels One Planet
Bicycles
Auto • OC Buick, Cadillac, GMC • Pristine Motors Wines and Spirits • Main Street Wine Company • Rolfs Wine Household • Crystal Coast Optometry • College Nannies & Tutors • Critter Clipper • Crown Cleaners
And usage is accelerating with zero promotion
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0
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Downloads Transactions
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Mobile App Searches
1,000 users . . . 1,000 transactions . . . And 10,000 searches
$215,000 in Merchant Sales in 8 months
The pilot verified key assumptions
What we learned . . .
• 50% of users logged-on over multiple months (2+ months)
• We drive incremental sales for merchants
(avg. 14 per merchant, highest is 112)
• High retention – haven’t lost a single merchant
• High adoption – 40%+ in some schools
• Broadly relevant to causes and merchants
• Merchant acquisition at <$300 is feasible
• Bounty is an effective vehicle to incent causes in acquiring merchants
($150/merchant)
• No resistance to our 20% processing fee
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We provide greater and sustainable value to all constituents
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Merchant Acquisition “Compelling”
User Acquisition
“Near zero cost”
Consumer Experience “Frictionless”
• Merchants are acquired once and remain on the platform (i.e., no re-acquisition) • Risk free value proposition (i.e, only make donations when you get a sale) • Loyalty-driven value proposition (i.e., not mercenary bargain shopping))
• Co-marketing with causes for cost effective acquisition • Greater adoption rates (e.g., opt-in, download, transact) • Our platform powers the cause’s program (i.e., we’re in the background)
• No breakage (i.e., unredeemed coupons or gift-cards) • Mobile app to stay “top of mind” (e.g., alerts, notifications, LBS) • Empowes users to support their cause when and where they want (i.e., on the go)
Our model has notable advantages
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Groupon MOGL CfC
Consumer Proposition
Bargain shopper Mixed – loyalty rewards and cause marketing
Shop for your cause
Merchant Proposition
Entice bargain shoppers to sample
Loyalty – to merchants or the platform?
Incremental sales from loyal customers
User Acquisition
$30 $12 $2-3
Merchant Acquisition
$4000+
“offer by offer”
$2500+
“Feet on the street”
$200-300
Acquire once “Causes as a channel”
Quarterly Rev/Customer
$15 $12-20 $27
Margin
39% 30% 56%
Financials
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Seed round
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Management Team
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Carlos Aguilar Co-Founder CEO
Ernst & Young • Global Mkts Leader • Customer Strategy
The Walt Disney Co. • VP Marketing & Alliances • VP New Media & Technology A. T. Kearney • Technology Strategy
Jennifer Aguilar Dir. of Community
Gary Allhusen Co-Founder Chairman
OC school • board member,
development committee Silver Bridge Associates • CEO, IT Services
Caneum, Inc • COO, IT Services Startup EDS and A. T. Kearney • Principle, IT Strategy.
The Pegasus School • Scrip fundraising chair
Special Olympics • Volunteer manager
Cap Gemini • Mgr Software Devpmt Ernst & Young • Mgr Software Devpmt
Advisory Board
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Lawrence Aldridge Advisor
Jeff Goffman Advisor
Aaron Sloman Advisor
Kurt Mulville Advisor
• Partner at Orrick
Rob Dang Advisor
Jeff Sakaguchi Advisor
Pat Wilkison Advisor
• Chair. American Red Cross LA • Fmr Accenture Partner • Fmr McKinsey & Co. • Technology Executive
• Marketing Western Digital • Tech investor/advisor
Blackbook, Cirro, Predixion Software, Flowsearch, twtMob, Moberitus, GenieDB, LegacyDirect
• Partner Fortis General Counsel • Tech startup advisor – Zynga,
Yahoo, mFoundry, et. al.
• GM Perficient SW Devpmt • Founder SpeakTECH • Fmr Sr. Technologist Microsoft
• Chief Alliance Officer, UnitedHealth
• Fmr SVP Alliances, Disney • Fmr VP Global Sourcing,
Disney • Fmr Chief Procurement
Officer, ARCO
• CEO Integrated Oncology Network
• Founder Oncure Medical • Founder US Diagnostic • Fmr Chair Amer Cancer
Society
Erik Anderson Advisor
• Pres. – Anderson Financial • Pres - A. Gary Anderson
Family Foundation • Former VP Trading,
Directors Mortgage • Tech investor/advisor
CMC, Parallax, Savant