SimplySell Phones LLC Business Plans3images.coroflot.com/user_files/individual_files/500918... · 2015-09-24 · SWOT Analysis Funding Needs Capital Raising Schedule Exit Strategy

Russ Grove President & CEO, SimplySell Phones LLC

119 9th Street, Etowah TN 37331

http://www.simplysellphones.com

Call: 423 920-9990 Email: [email protected]

SimplySell Phones LLC Business Plan

TABLE OF CONTENTS

Executive Summary

Market Conditions Market Data Market Need

Company Overview

Tennessee Operations RPM eCommerce Workstations Explained Technological & Software Advantages Business Model Extended Warranty & SimplySellPhones.com Executive Bios

Financials

3 Year Revenue Plan SWOT Analysis Funding Needs Capital Raising Schedule Exit Strategy Competitive Landscape Summary & Conclusion

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Please note: Colors of information sections above match color on corresponding page footer

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Executive Summary

The fact that smartphone prices don’t have to be ridiculously high is a revelation dawning on consumers around the world.

In the US, wireless carriers are ending the old system of contracts & new smartphone cost subsidization, shifting the cost burden onto a consumer who is simultaneously showing a general lack of excitement for each new generation of phones that are better – but only marginally.

The age of good-enough smartphones is coming rapidly.

Today, the number of smartphones in use globally nears 3 billion. That’s 3 billion opportunities to sell the pre-owned smartphones with extended warranties for wireless retailers & consumers needing an alternative to both high priced new phones & an outdated used phone resale system that generates little return.

Change is brewing in a market with incredible growth potential as the tipping point occurs to pre-owned vs. new

The wireless industry is poised for significant revenue and shareholder value creation. With capital investment, our aim is to disrupt the current leading 3rd party trade-in companies, demonstrating our model works better.

It is our plan to seek acquisition vs. many rounds of funding, dilution, & a hopeful IPO many years out. Our exit strategy for stakeholders is to seek partnership with an existing conglomerate who, using our business model, can consolidate the multi-billion dollar used smartphone industry.

We aim to achieve this goal by changing the way the consumer views used smartphones through our creation of the optimal used smartphone purchasing & selling experience using our distinguishing Revenue Producing MachineSM (RPM) & extended warranty offerings.

Simply Sell Phones (SSP) has 8 revenue channels ready to scale & is social media developed. All we require to proceed are an ample supply of used smartphones and a minimal amount of capitalization

We aim to partner with direct & independent wireless retailers, providing them with a profitable solution to their used product problem – reinvigorating used product trade-in programs into a significant revenue stream & sales incentive.

We Simply Sell Phones. It’s what we do.

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Market Conditions / Tipping Point

Used Smartphones New Smartphones

Higher Value / ResoldDemand for Used Smartphone NormConsignment vs trade In ModelWireless Retailers make more margin selling Used Phones with Activation than New PhonesExtended WarrantyFinanced or Buy Model – Save 50% over cost of newMulti-carrier activation – one-stop e-store

Financed Model $45 Month / $19 a month for phone No ContractWeb based purchasesMFG Warranty Apple, Samsung, LG, Nokia, HTC, ZTE

The age of good-enough smartphones is here. 2018

Why is the smartphone – which is so critical to daily life globally -- not more profitable?

It’s time the scales tipped in everybody’s favor – wireless companies, consumers, businesses, non-profits, & manufacturers.

Higher Value / ResoldDemand for Used Smartphone increasesConsignment vs trade In ModelWireless Retailers have to find a solution for used devices – Margin vs accommodation will emerge

Financed Model $45 Month / $19 a month for phone New Feature Rich Phones every 6 MonthsSilo Wireless Retailers - Everywhere2 Year Contracts / Pay as you goMFG Warranty Other Mfg’s Phones HTC, LG, NOKIA, ZTE increase market share Carriers Unlocked Phones Law

The age of good-enough smartphones is coming. 2015- 2017

Accommodation Low Value / Trade-In'sWholesale is Retail / Lots sold OverseasBrightStar, Gazelle, Phobio, BSTOCK Auctions emerge

Subsided Model $92 Month / Free PhoneNew Model Feature Rich Phones every 6 MonthsSilo Wireless Retailers - Everywhere2 Year Contracts / Pay as you goMFG Warranty 80% of the World uses a Smartphone Daily75% of the phones are Apple or Samsung

The age of good-enough smartphones is an idea. 2007 - 2014

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In 2015 US Government law (S.517 Unlocking Consumer Choice and Wireless Competition Act) went into place, requiring wireless retailers to unlock their cell phones so the consumer is free to activate their cell phone with any compatible wireless carrier, driving up the demand for used cellphones.

August 8, 2015 TIME magazine reports on Verizon’s decision to join T-Mobile and AT&T in abandoning contracts and subsidies for new customers in its article “How You Buy Cellphones is About to Change Forever.”

Fewer consumers will purchase the newest iPhone as they will now have to pay the full $849 for an iPhone 6S which was previously subsidized through 2 year contracts from their wireless carrier. Although the $849 can be financed, savvy consumers will seek out used phones.

Consumers will be interested in purchasing quality pre-owned smartphones with 1 year extended warranty, and carriers are currently NOT equipped to meet this demand. The service we offer through our RPM technology will equip carriers to meet their customers’ needs for quality pre-owned devices, simultaneously making the carriers much more money on the used product customers currently trade-in.

The Market Need for

Market Data / Hot Growth Space

In spite of a never-ending pipeline of new smartphones, a growing number of consumers are opting for pre-owned smartphones. Earlier this year, tech-research firm Gartner predicted that the market for used smartphones will roughly double to 120 million units, or a wholesale value of $14 billion, by 2017.

Even though there's always been a market for used cell phones, most of them were sold wholesale overseas. Now as wireless operators push customers to pay full price for smartphones and as consumers grow accustomed to buying unsubsidized smartphones -- consumers and businesses are realizing the true value of purchasing pre-owned smartphones.

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Company Overview

SimplySell Phones is taking advantage of an opportunity to become a highly distinguished and leader in the Clean-Tech used smartphone resale industry. It is the goal of our company to become the leading online reseller of pre-owned smartphones sold with warranty and post-sales support, with the sell-for-you model as our primary supply source.

In order to achieve this goal, our critical success factors will be to identify emerging trends and integrate them into our company operations, respond quickly to technology changes/be there early, provide high-quality services, invest time and money in marketing and advertising, expand into specialty markets, and reshape how used smartphones are bought and sold globally.

18 months ago SimplySell Phones started its business life as a segment of MobileCommerce Solutions by working on a project with a Wireless Retailer using our RPM technology to make it easier to sell smartphones from store trade-ins online using our existing Tennessee Facilities.

In March of 2015 SimplySell Phones acquired eTenn Electronics and merged operations under SSP. In an effort to focus the business model, SimplySell Phones launched as a consignment based operational processor and re-seller of quality used smartphones sold with extended warranty contracts.

SSP operates a 17,000 sq. ft. facility in Etowah TN – near the junction of I-75 (North and South) and I-40 (East and West) – an ideal logistics location for a centralized processing center selling smartphones.

3 RPM Lines are set up with a current capacity of 600 phones processed per day. Additional RPM’s will be added as sales production lines expand – we have two slated to go into service 1/1/2016 for a total of five.

Due to the size of cell phones, the facility has a minimum 10X capacity with minimum incremental facility costs. Facility is in place, operating, and ready to scale.

SimplySell Phones Tennessee Operations

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At its simplest level – place a smartphone into the Revenue-Producing Machine (RPM) and within minutes the phone is reaching a potential 1.2 Billion global buyers as if they were holding it in hand. RPM’s give SSP a strategic operating advantage. Our two models – • Industrial Grade Operational Model (RPM3.0) operating in SSP’s centralized processing center and the New “All In One eCommerce Workstation” designed for wireless retailers to run their own smartphone selling operation at their local store – produce optimum online selling results representing each phone’s images and unique information vs. using stock listings.

RPM eCommerce Workstations Explained

We Simply Sell Phones. It’s what we do. But we sell smarter.

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SSP Advantages – RPM Technology

RPM Equipment & Functionality

Our business model disrupts the two leading 3rd party trading competitors’ models, improving upon them via our RPM technology. With investment and scaling, we will achieve higher margins for our partners. We represent the phones better and have the ability to sell phones one at a time efficiently, giving us a competitive position over current companies who wholesale to wholesalers.

Image Capture& Photo Editing – Digital SLR camera – RPM3.0 is staged with professional photography equipment, the latest in image capture lighting, a photo stage, & editing software

Computer, Web Cam, Wireless Printer – Photo / UPC Scanning

Audio System

Control Panel (* See Control Panel P9) – Venue Store / graphic setup & management

Item Lookup – value estimator – category selection – selling metrics & competitor research

Listing Management – Software tools enable the ability to prepare items for online listings, schedule auction timeframes, track items that have been won by bidders, prepare items for safe shipment & to repost any items that did not sell or were not paid for in a timely manner. This tool includes administrative functions for running a variety of reports

Inventory, Client & Consignment management

Shipping Scale(s) & equipment integrated with SSP’s Cloud based software control panel configured for its business – Shipping tools coordinate & manage shipments worldwide

Logistics- Global Freight Management – Package Tracking Automation

CRM – Buyer / Customer communications & management

Finance – P&L – Metrics – Reporting – Cloud based tools manage the complex task of tracking all the steps to run & manage an online selling & social commerce branding operation

Secure login functions provide web based software for remote support & management options

We Simply Sell Phones. It’s what we do. But we sell better.

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At the heart of SSP’s operations is its cloud based RPM customizable control panel. The control panel integrates the production side of running the business with a seamless interface allowing multiple processes running on one or more workstations to interact and operate as an enterprise system. The control panel applications interfaced with RPM3.0 Hardware streamlines deployment and delivery.

Integration with the control panel allows for efficient capturing & posting of detailed online selling listings.

Individualized photo detail is essential for obtaining the best selling price for items sold online. It also helps realistically represent items to avoid returns

Our control panel program gives additional destination, size of packaging, & weight information for the USPS. This supplemental information helps users with unusual order shipping questions

The control panel provides a suite of cloud based software including research tools for best-selling practices – item specifics, market & pricing research, auction posting, freight management, reporting, customer communications, accounting/finance & support/training tools.

RPM Control Panel & Cloud Based SoftwareApplications

We Simply Sell Phones. It’s what we do. But we sell better.

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Business Model

Carriers, Wireless

Dealers, & Independent

Resellers

Smartphone Manufacturers

Non-profits & charities

Consumers & businesses

that trade in phones with

national trade-in

companies

1 2

3 4

SSP has developed sales & marketing programs and collateral to support its business development efforts in four primary channels.

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1. Carriers, Wireless Dealers, & Independent Resellers

The leading third party trade-in company serves the majority of the big 4 wireless retailers. However, margins produced by this 3rd party offering to the wireless retailer are very small if any. It also requires retailers to run 3rd party software in addition to their own POS systems to facilitate a trade in. Wireless retailers are faced with declining revenues and subscription activation margins. Today the leading 3rd party pays only a few commission points on the very low trade in price. This offering is dated. Although it once had its time, it is today more of an accommodation service that facilitates the trade-in program for wireless retailers. SSP makes the Wireless Retailers > 9x more margin than they are making today using the leading 3rd Party

SSP feels it can win significant business opportunities by positioning its RPM and Sell For You variable priced services to the Wireless retailers with the introduction of SSP’s All In One ecommerce RPM designed exclusively for selling used smartphones via in store operations.

WirelessRetailer

Out Task Operations < Direct Online Sales Channels >In-store Direct Operations

SSP Builds RetailersCustom Control Panel Sets up Wireless RetailersOnline Capabilities

SSP TN Operations – Wireless Retailers Online Accounts &

Selling ChannelsCo-source Process

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2

3

Lease RPM3.0 “All In One eCommerceWorkstation”Direct Local Store Operations

Fast Cycle Sales Cycle SSP TN Operations our Online Accounts And Selling Channels

Outsource Online SalesChannels & Operations

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Today – Wireless Store Supported by Leading 3rd Party Trade-In Company Makes $3 – We Pay More:

SimplySell Phones aims to team with wireless retailers, improving customer loyalty by providing solutions vs. dated trade-in programs. Example: Samsung Galaxy S4 Traded in – Today, consumer or business gets $60

Wireless retailer – gets 5%-10% of trade in value – wireless retailer makes $3.00 - $6.00 revenue for facilitating trade-in for leading 3rd party trade-in company (*see Competitive Landscape on p 23). The phone is packed up and sent back to the 3rd party leading trade-in’s processing operations and sold on the open Market for $165.00.

Tomorrow – Say Hello to SSP Support – It Makes Wireless Retailers Money & Brings Flexibility to Run Their Business:

Option 2: Out-Task Operations to SSP with Direct Selling Channels EnabledSSP builds retailers a custom control panel, setting up the wireless retailer’s online capabilities. They insource their selling channels, outsourcing labor operations to SSP. Wireless retailer maintains direct control of buyer accounts and financial transactions. After a set-up fee, SSP charges a variable selling fee (at 32%, the wireless retailer nets $35.70).

Option 3: 100% Outsourced to SSP’s Online Sales Channels & OperationsWireless Retailer outsources labor and selling operations to SSP’s TN operations. We Sell for You through our established selling channels – SSP charges a variable selling fee of final selling price and performs all operations (at 32%, the Wireless retailer nets $35.70).

Option 1: In-Store Operations with Direct Selling Channels EnabledWireless Retailer leases an RPM from SSP for $499 per month. The retailer pays $60 to the trade in customer and resells the Galaxy S4 online. 10% selling fees are paid to the venue, and the retailer nets $88.50. The retailer may choose to charge for shipping, further increasing revenues. Retailers may also remotely activate the phone for any new customer outside its retail proximity. SSP’s social media harvesting will also drive more trade-in clients and new phone buyers to the local wireless store. Store performs all direct operations and labor to sell phones online after SSP outfits the sales channels.

We Simply Sell Phones. It’s what we do. We sell for you.

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2. Consumers & Businesses that Trade in Phones with Leading 3rd Party Trade-In Companies — We Pay More

Today Leading 3rd party trade-in companies (*See Competitive Landscape P 23) offer a very low trade in value for phones that cost significantly more when the user or business purchased them. The leading 3rd party trade-in company has performed over 2 Million trade-in’s.

Example: Samsung S3 Trade-in – Consumer or business offered $5

The user or business sends it in to the leading 3rd party trade-in company – owner sends in the phone – up to 3 weeks later the owner gets a check, often for less than the trade-in company offered because the company downgraded the phone’s condition. Only late model phones are taken and very little payment (if any) is offered for older phones or phones in good condition. The phone is processed and resold by the company for an average of $81

Tomorrow

Say hello to SimplySell Phones – We Sell For You – Call 1-800-320-6013. – Mail SSP your phone. SSP receives, tests, grades, recertifies, wipes data, cleans & sells the phone for the highest resale value in 3 days.

Owner gets paid $48 by check or PayPal after our variable selling fee (calculated here at our average 32%) and eBay’s fees (10%), a 9.5x return on their trade-in.

We Simply Sell Phones. It’s what we do. But we pay more.

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3. Non-Profits – Charities

Say hello to SimplySell Phones – Potential Donors donate their unwanted smartphones to their favorite charity – SSP sells the phones for the charity, charging a variable fee.

It’s fundraising made simple. SSP will open up non-profits to a wider base, and because of our diverse offering – we sell any condition and model phones – we earn more money to support the non-profit’s mission than the leading 3rd party trade-in companies.

4. Smartphone Manufacturers

As SSP grows and its balance sheet strengthens, it will focus on

developing direct relationships with manufacturers to resell their excess and obsolete inventories.

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SSP will offer for sale extended warranty options, up to a full lifetime warranty – we believe this distinguishing factor will be the tipping point driving customers to choose used over the high cost of new.

Our extended warranty program will generate high margin revenues and will increase cash flow.

SimplySell Phones LLC e-store(s) will operate virtually 24 hours a day, 7 days a week, 365 Days a year.

Warranty Support Programs will need technical support – call center staffing will be needed to manage inbound order generation for clients wanting to sell their unwanted phones.

Etowah, TN is very near to Cleveland, TN – home to Whirlpool’s Corporate call center operations – a qualified pool of employees is directly available as the company scales.

Extended Warranty &

800 Number & Call Center – ready for the phones to ring.

Until now, there was no trusted space to buy used smartphones with confidence. Say hello to SimplySellPhones.com – the destination site for consumers to purchase Virtually New Smartphones with extended warranties.

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Russ Grove – President & CEO

After serving in the United States Marine Corps, Russ has been with 5 companies in his 33 year computer industry, reverse logistics and ecommerce career- 3 of which he created over the past 18 years. Russ started his career at a fortune 50 company as a Test Engineer and worked his way through the operational management ranks until he became group director of operations. Here Russ’s operational background allowed him to sell to large fortune 50 Companies’ infrastructure, outsourcing programs. After successfully developing a large $50 Million dollar program with IBM, Russ began his sales career, developing sales and marketing programs and organizations sold to the largest technology companies. In 1995 Russ saw the internet emerging and wanted to wrap his career around it.He joined a large reverse logistics company – his first executive officer role –as President & CEO, creating an INC 500 company that grew to process over 8000 returns a day of pc’s, laptops and peripherals which were sold via the internet. In 1997 Russ started writing the business model for what would later become known as eBay drop off stores. In 2000 Russ stepped off his role to create a ground up company providing consignment-based programs for unwanted household items. The company grew to 19 franchised locations and became the 77th largest seller on eBay, selling over 1M items. This business model ultimately did not work and the company’s assets were sold in 2007. In hindsight Russ saw the model as failed but not the need – you see stuff –he sees money, so he kept working on the model and developed the RPM (Revenue Producing Machine)– an automated machine and software designed to increase productivity and simplify tasks associated with selling online. Over the next 8 years Russ ran a successful business selling RPM’s and providing ecommerce consulting.

Russ GroveExecutiveBios

Brad WilsonGlen Hammer

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Glen Hammer – Chief Warranty Officer &Director

Mr. Hammer has accepted a Board seat with SimplySell Phones, LLC, agreeing to oversee the development and installation of our warranty/service contract division. His intention is to provide the expertise necessary for SimplySell Phones to become known as the premier organization providing the highest level of care and after market cellphone support to our customers. Mr. Hammer brings to SimplySell Phones over 35 years of broad entrepreneurial experience in the development and growth of warranty positioning, extended service offerings, and after-sales support in both privately held and publicly traded entities. Previously, Mr. Hammer was the founder and Chairman of the Automobile Protection Corporation, which grew into one of the automotive industry’s most prominent automobile warranty service companies. He successfully guided the Automobile Protection Corporation’s growth and transition to a highly successful, publicly traded company in 1988, which was subsequently sold to the Ford Motor Corporation.In 2006, after building the Warranty Corporation of America (WaCA) into a 450 person organization experiencing in excess of $100 Million of annual sales, Mr. Hammer, as founder and Chairman, sold this world class organization to a fortune 500 company for in excess of $50,000,000. At the time of sale, WaCA had offices in Atlanta, Los Angeles, Peoria, and Montreal.Since the sale of WaCA, Mr. Hammer has been providing consulting expertise in the warranty and extended service contract arena.

Brad Wilson – Chief Operating Officer

Brad started his career off in the services industry, learning valuable supervisory and management roles servicing customers in a fast paced environment. Brad’s strong technical and analytical interests led him to the wireless industry and he joined a top four wireless provider, running retail operations. There, he learned the technical and sales side of the consumer demand for smartphones. Brad later left to join the 5th largest logistics provider subsidiary as the outbound freight coordinator – while there he learned the power of logistics. Brad’s calling led him to the entrepreneur ranks and he started his own company selling electronics on multiple online selling channels. Faced with the challenges to scale, Brad saw a unique opportunity to merge and join his company with SimplySell Phones.

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SimplySell Phones 3 Year Revenue Plans & SWOT Analysis

2015 2016 2017

3 Year Revenue Projections

$556K

($88K)

$5.9M

$962K

$18.1M

$3.8M

(chart not to scale)

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Year I Year II Year IIIRevenue Qty Sold AssumptionsRPM Lease Qty Sold 14 437 2835Extended Warranty Qty Sold 365 6375 16300SSP.COM Volumne Qty Sold 1028 12750 20200eBay sales Volumne Qty Sold 4336 17650 28400Amazon sales Volumne Qty Sold 1780 10000 18700All Shiping Volumne Total Qty 7144 40400 67300

RevenueRPM Lease 9,980 1,151,203 9,935,090ebay 234,893 1,676,750 2,698,000amazon 136,195 950,000 1,776,500SSP.com 149,065 1,848,750 2,929,000Extended Warranty 13,826 241,485 617,444Pack & Ship Fee 12,502 70,700 117,775

Total Revenue 556,456 5,938,888 18,073,809

Cost of Goods SoldRPM Build outs 1,600 184,400 1,592,808ssp inventory 171,153 1,679,250 2,823,300Consignment Payments 62,881 475,000 888,250Warranty inventory 6,222 108,668 277,850Shiping Cost 26,790 151,500 252,375eBay / Paypal Fees 14,909 137,275 234,650

Total Material Costs 283,555 2,736,093 6,069,233

RPM Mfg Labor 1,397 161,168 1,390,913Item processing labor 55,337 793,207 2,417,269

Warranty Administration 1,244 21,734 55,570Non-Exempt 38,480 475,111 1,445,905Total Labor 57,979 1,451,220 5,309,656Payroll Taxes-Labor 8,697 217,683 796,448Benefits-Labor 20,866 237,556 722,952

Total Labor Costs 87,542 1,906,459 6,829,057

Total COGS 371,097 4,642,552 12,898,290$$ Gross Margin 185,359 1,296,336 5,175,519

% Gross Margin 0 0 0

General and Administrative CostsT&L 3,750 46,200 144,000Rent 9,000 11,000 15,500Marketing 66,493 237,556 722,952Supplies & Other 7,900 118,778 361,476Utilities 3,705 10,000 10,000Internet 1,500 3,500 7,550Directors 100,000 257,000 288,000CFO 21,000 80,000 140,000VP Sales 17,000 120,000 152,000Cell Phones 9,000 16,000 30,000Facility Repairs & Maintenance 5,509 12,000 18,000Security and Cleaning 4,000 6,000 8,000Insurance 7,610 26,000 58,000Equipment Rental 1,850 4,500 4,500Loan Interest 15,000 15,000 15,000Loan Repayment Total G & A Costs 237,317 962,033 1,690,129

Net Income (87,958) 334,303 3,845,391Net Income % (15.8%) 5.6% 19.3%

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Start-up Funding Needs

We are excited to bring this model to market and believe that time is of the essence and will have a direct correlation to the amount of return on investment to our stakeholders.

The company is seeking a seed Investment of $300K in SimplySellPhones LLC. The company will issue the seed Investor a promissory note for the investment amount that contains an automatic conversion clause converting debt to equity (new shares for the Angel Investor) upon qualified financing A Round Capital raise.

The following chart and table show projected initial start-up costs for SimplySellPhones LLC.

Use of Funds

Operations Labor $ 10,000Sales and Marketing – Consignment Demand Generation $125,000Legal – Series A Doc’s $ 8,000Facility Lease Hold $ 7,000SEO – web traffic demand generation $ 50,000

Total Start-Up Expenses $200,000

Start-Up Assets:Cash $10,000Startup-up inventory –resale & warranty exchange $90,000

Total Assets $100,000

Total Start-up Requirements $300,000

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Capital Raising Plans / Schedule

Plans to raise capital to fund growth initiatives

SSP will use its seed capital round to:

Use of Capital / Angel Round

$300K Seed Convertible debt to equity / promissory note / conversion feature 4th Qtr. 2015$3-5M Series A Round 1st half 2016$7-15M Series B Round 3rd Qtr. 2017 – if needed

Hire critical operational staff to produce incremental revenueAcquire inventory it can resell on its web site & Omni channelsFund sales & marketing programs via social media & SEO programsFormat its sales operationsFund its inventory to support its extended warranty programs

SSP will use its Series-A round to:

Use of Capital / A Round

Generate additional B2C sales programs focused on gaining more traction in its "Sell for You" marketing programsGenerate new sales program to win wireless reseller programs – increase competi-tive take away from 3rd party trade in companies currently supporting wireless dealers trade-in programsFund increment inventory programs to scale revenueExpand its management team

SSP will use its B Round of capital to:

Use of Capital / B Round (if needed )

Expand senior management teamIncrease sales and marketing programs for all revenue segmentsIncrease its operational capacityExpand operations workforce.Expand sales & marketing programsIncrease social media presence

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The company believes that in the next 24 to 36 months it will be able to execute its business model and the marketplace will continue to grow rapidly. Over time the barrier to entry and time required to build an infrastructure such as ours will make SimplySell Phones a strong acquisition target for:

SSP Executive Management believes it can increase stakeholders value over time and position the company to be sold within 36 months for $30M- $50M or beyond.

Company Liquidity / Exit Strategy

Warranty Service CompaniesMajor Wireless Entities (Brightstar, etc.)Well-funded trade-in companies (Gazelle, Phobio)Wireless Carriers (Virgin Mobile, Verizon, AT&T)Manufacturers infrastructure (Apple, Samsung, ZTE)Logistics Carriers / Reverse Logistics Companies (UPS, FEDEX, GENCO)

Investor Return Strategy

Angel Investor- $300K convertible debt to equity upon qualified Financing A Round

Convert securities at a price per share equal to 80% of price per share paid by qualified financing investors.

Series A Investment(s) $3M-$5M – Investment will position the company to scale its business model and infrastructure.

Our company goal is a liquidity event. Investor may see a liquidity event within 24 - 36 months of investment. Without a B-Round Investment, company target price will be 5X revenue.

Series B Investment $7M - $15M- Investment will position the company to expand its market capitalization. Target acquisition price will be -15X revenue.

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Competitive Landscape

The goal of SSP’s application of investment capital is to disrupt the following competitors via a more innovative, efficient, and profitable smartphone consignment operation.

Gazelle is the nation’s leading consumer electronics trade-in site and a leading e-commerce site where consumers can buy certified pre-owned devices. Gazelle has handled more than 2 million consumer devices and paid out more than $200 million for unwanted items

Gazelle has the support of the following investment partners: Venrock, RockPort Capital, Physic Ventures, and Craton Equity Partners.

Phobio offers trade-in programs, with accounts teams and processing facilities on 3 continents and support teams working 24 hours a day.

A distinguishing factor of Phobio is that they have built their own software tools for pricing, inventory, disposition and sales; they manage their own international disposition channels, and they’ve deliberately designed every process in-between.

Phobio currently purchases customer trade-in’s from wireless retailers.

SmartphoneTradeIn.com is powered by GRC Wireless, the largest grassroots cell phone trade-in and buyback company in North America. They have purchased over 7 million phones since 2002, and are the current trusted trade-in and recycling partner to tens of thousands of organizations and individuals nationwide.

Smartphone Trade In currently buys and sells from consumers and accepts limited models of phones.

Like our name says – “We Simply Sell Phones” but we sell them for businesses and consumers on consignment. To facilitate this SSP receives, tests, certifies and grades pre-owned smartphones. We even repair phones as needed to get the highest recovery rate for defective phones in the fastest possible turnaround.

I don’t want to be the pioneer of another business idea, but to deploy a better, disruptive business model on a path ripe with opportunity and already cut. The age of good enough smartphones is coming.

Russ GrovePresident & CEOSimplySell Phones LLC

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SSP Business Plan Summary & Conclusion

Full Support – SSP takes all types of phones, working, defective, broken glass, & all grades including bad ESN Phones.

SSP is one lifecycle away from current marketed new products & not a competitor of wireless carriers and dealers.

SSP has automated process equipment & software systems called RPM’s (Revenue Producing Machines) engineered by SSP – engineered by SSP to ensure we represent each individual item & condition accurately in its listing. After test & recertification, each phone gets 8 photo images of the actual phone for sale to best represent the condition of the pre-owned smartphone in resale marketplaces.

SSP sells on eBay, Amazon, www.simplysellphones.com & drives traffic from harvesting social media via Facebook, Twitter & Pinterest to find more buyers.

Within minutes the phone being sold reaches a potential 1 Billion global buyers & sells in 3 days on average.

SSP will sell extended warranties on all phones sold, increasing buyer confidence to buy pre-owned smartphones.

Because of its infrastructure to support smartphones, SSP has the opportunity to sell extended warranties as a product for other pre-owned smartphone resellers & warranty providers as an additional revenue segment.