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Business Plan
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Transcript of Business Plan
June 27, 2013
Business Plan
CONFIDENTIAL
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Company Purpose
To provide high quality vocational training through the use of simulation technology for the Indian workforce.
A future in which Quantum Learning Systems is the recognized leader among vocational training education for:
Vocational learning
Economic development
Global reach
Technology
Engagement and public service
Sustainability
Mission
Vision
Quantum’s vocational simulation training expertise, equipment and dedicated & experienced management team will help meet such skill demands quickly and cost effectively.
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Problem and Situation
India has a large population of young people– 50% of population of 1.2 billion younger than age 25
Indian government estimates 500 million young people must be trained by 2022
Nearly 70% of Indian employers have trouble hiring staff members (Study: Manpower)
Only 2% of Indian youth, and 7% of whole working age population have received vocational training (Study: NSSO)
Quality of current vocational training very low-e.g. 60% of those who did textile related vocational training are no longer in the workforce (Study: NSSO)
Percentage of workforce receiving skill training Today’s vocational training centers
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The Solution
Quantum will deliver both classroom and technology based training solutions.
Virtual Simulators Classroom
Solutions
Example: Flight training and firefighter simulators
e-Learning
Virtual e-Learning solutions Classroom training
Virtual Simulators: An innovative approach to vocational training, simulators offer hands-on training enabling workers to be field ready immediately
E-Learning: Self-service e-Learning tools allow trainees the most flexibility
Classroom: Traditional classroom instruction from experts in their respective fields
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Market and Opportunity
The overall skill enhancement market in India is estimated at $2.52 billion and is expected to grow to $20.5 billion by 2018
The current child skill development market in India is estimated at $740 million
The IT training Compound Annual Growth Rate (CAGR) in India is about 45% and will be $1.05 billion in 2015
The vocational training market has the largest share of about 60% in India, and is estimated to be growing at 15-20% a year
The market is large and positioned for growth….
Total Addressable Market: $20.5 Billion by 2018
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Target Market Segments
Based on Government of India policy directives and current economic trends, the following market segments will be initially targeted.
Telecom equipment Aerospace Shipping Defense equipment
Solar energy Oil exploration and
transport Clean coal
technologies Nuclear power
generation
Textiles and garments Leather and footwear Gems and jewelry Food processing Handlooms and handicrafts
Heavy electrical equipment
Heavy transport, earth moving equipment
Mining equipment
Machine tools IT hardware and electronics
ICC
Target MarketsTarget Markets
Strategic Security
Enablement
Energy
Large Employment
Creation
CapitalEquipment
ManufacturingTechnologyEnablement
HighGrowth Sectors
Automotive Pharmaceuticals Administrative Services
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Competitive Landscape
Competition is highly fragmented, with most focused on distribution. Major players are supported by NSDC.
Competition centered around training distribution
Limited competition among content providers
Opportunity to turn potential competitors into channel partners by offering high quality content
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Competitive Edge
Produce quality, custom tailored training content Not burdened by distribution overhead
Focus on Content
Focus on Content
Simulators are a novel training platform in India Simulations are widely accepted as highly effective
training tools
Simulation TechnologySimulation Technology
Management team’s relationships with CEOs of major corporations
Team’s relationships with senior government officialsRelationshipsRelationships
Quantum’s solutions are the first of their kind in the India market.
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Business Model
Businesses, consumers, and the Indian government will drive revenue to the company.
Revenue Model Contract-based Subscription-based, Profit-sharing w. training centers
Pricing Variable pricing model Average of $500 / year / user
Average Account Size
$1MM/year/account --
Sales & Distribution
Direct sales to corporations, governments and local municipalities
Training centers, online portal and classroom-based
Current Customer Pipeline
Pepsi India, state and federal governments
NIIT, Gras
B2B B2C
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Near-term Timeline
July / Aug 2013
July / Aug 2013
Approvals from Government of India
Aug / Sep 2013
Aug / Sep 2013
Quantum Simulators applies for Offset license funding (3 months)- $10MM
Sep / Oct 2013
Sep / Oct 2013
Negotiation with offset obligors
Filing agreements with Reserve Bank of India
Oct / Nov 2013
Oct / Nov 2013
File application for term and commercial loan with banks
Land acquisition
Import equipment and technology
March 2014 & Ongoing
March 2014 & Ongoing
Business development activities
Federal/state public sector activities (e.g. BEL, HAL, BSNL, SAIL, etc.)
Partnerships with polytechnic universities and training schools
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General assumptions in forecasting the investments of the business
• Estimated Start Up Costs: $ 10,000,000
‒ Includes Equipment, Software, product launching, trail orders etc, recruitment, training
Estimated Construction Costs: $,20, 000,000
‒ Price of land, Offices/Classrooms, Parking, manufacturing/Warehouses, , Retail, Business Development
Estimated Pre-Operative Expenses: $5,000,000
‒ All additional operational expenses associated with starting up, licensing,
Total Capital Required for Start Up = $35,000,000
Financials – Startup Assumptions
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Projected Revenues
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Current Status
Composite application with the FIPB and Ministry of Industry has been filed. Upon approval of which Quantum will be eligible to avail US $10 million as offset funds from the obligors
16 ministries from the Government of India have reviewed the application and have given their formal recommendation to the Licensing Board for approval with due diligence done by the Embassy of India in the USA about Quantum and its promoters
Letter of Intent for the allotment of land for 30 acres by the Government of Gujarat (the most preferred location in India) at a fraction of cost than the prevailing market price has been obtained
Indian company under the banner of Quantum Simulators (PVT) Ltd .has been incorporated as per the guidelines of the Ministry of Company Affairs
Board of Advisors for the Indian company, Quantum Simulators, has been finalized
Permission is being sought from the Reserve Bank of India to open business account for Quantum Simulators (PVT) Ltd
Discussions are underway with the Indian Government owned public sector undertakings and other private institutions for the sales of Quantum’s products and services through direct export until the Indian facility becomes operational
APPENDIX
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Solution Approach
Needs Assessment
Needs Assessment
Work with customer to perform preliminary analysis and assess costs and benefits. Contract is signed with customer.
Plan & AnalyzePlan &
Analyze
Analyze trainees’ learning needs and collaborate with customer to define high level requirements.
Design & Build
Design & Build
Design and build technical solution, custom tailored to customers’ specifications.
DeployDeploy
ExpandExpand
Train the trainers; Launch and execute training solution.
Perform enhancements on existing solution and identify new opportunities for customer.
A consistent service delivery approach will be critical for success.
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Location
We plan to operate at multiple training institutes and well as at company’s training facility and manufacturing plant
Proposed 100,000 sq. ft. of useable area fitted for manufacturing, assembling, testing, shipping, storage and corporate office
Proposed 200,000 sq. ft. of useable area fitted for vocational training and education
Artist’s rendition of Quantum’s simulation manufacturing facility
Artist’s rendition of Quantum’s vocational training facility
Manufacturing & Training Facilities
State of the art manufacturing and training facilities will be located in Gujarat.
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Quantum Team Members
Lala Mohapatra
Chairman & CEO
Lala Mohapatra is an experienced international executive with a record of over 30 years of proven accomplishments in the area of international marketing, strategic planning, foreign collaborations and investments. Mr. Mohapatra has been responsible for complete management and sales profit of major multinational companies and their entry into the marketplace of India. He has represented major US companies in Defense Telecom, satellite, media and advertisement, animations and computers in India as a senior advisor to the management generating revenues and profitability Mr. Mohapatra served as President of Commodore in India. He was the first to introduce personal computer in India and recently was responsible to complete a transaction for the sale of a 200 million dollar USA made simulators to the Indian army. Mr. Mohapatra was the Managing Director of a Private Equity fund from Washington, DC and his area of focus was in India for many startup companies which became highly profitable for the US Equity Fund for several hundred million USD. Mr. Mohapatra studied Electrical Engineering at the graduate school at Villanova and holds an MBA from Penn State, USA. Mr. Mohapatra holds a degree in Law specializing in International corporate law
Devdas Chhotray
Rajesh Grover
CFO
Rajesh Grover has extensive experience as a successful entrepreneur and in developing business relationships and raising capital for various projects. Mr. Grover was a partner in a CPA firm and played a key role in building a highly successful company, which climbed to over 140 employees and revenues of over $8 million in two years. Three years ago he started another company specializing in security solutions for government and private sector in India. He was instrumental in partnering with a large size IT Company and State owned entity to obtain large size projects. During that project, he met with senior secretaries of the Government of India and discussed about the requirements of Homeland Security and its potentials in India. He travels frequently to India and has built solid reputation among its peers.
Delbert Winn
Executive VP & General Counsel
Delbert Winn is an attorney and acknowledged authority in areas of international business development, overseas manufacturing, transnational joint ventures, product sales and distribution, intellectual property protection, overseas profit repatriation, negotiating with private parties and foreign governments. Mr. Winn’s articles on international negotiations and contracts have been distributed in 75 countries. Mr. Winn’s clients have included numerous military and police simulation training companies who’s worldwide operations have spanned over 50 countries.
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Quantum’s Advisory Board
Quantum has assembled an accomplished and talented group of individuals to serve on its advisory board.
Mr. Devdas Chhotray (IAS Ret.), former Secretary, Ministry of Home, Government of India
Lt Gen JK Mohanty (Ret.), was responsible for the coordination of various facts of professional and technical (combat) training in twenty seven training establishments of the Army.
Mr. D.P. Bagchi (IAS Ret.), former Chief Secretary, Government of Orissa, and former Chairman, Foreign Investment Promotion Board.
Mr. G.B. Patnaik, former Chief Justice of the Indian Supreme Court
N.C.Padhi (IAS Ret.), former Head of Police, Federal Government of India
Lalit Mansingh, (IAS Ret.), former Ambassador of India in the US
K. Dhillon, Chairman and CEO, Pepsi India
N.Mohanty, (IAS Ret.), former Secretary of Industries, Government of India
Col (Ret.) N.R. Pani, former Member of Defense Offset and Funding Agency
Mr. Robert A. Dare, Jr. Former Command Sgt. Maj., US Army, and Vice President, Sales for Meggitt PLC
These individuals have major distinctions in the world of start-ups, finance, management, law, and marketing & sales. Our advisors provide us with invaluable experience and insight on strategic issues as well as client projects.