Work@Home Business Plan

New Venture Development
Work@Home Business Plan
June 20h, 2000

Work@Home is a virtual marketplace for Expert services in Italy, that puts in contact experts
that can offer their advise/ work over the web with clients that need some work done. In this
site, experts of different domains can offer their services to companies or other individuals
that need in an uneven basis an array of services of very unique nature. The following
document explain this business opportunity in detail.

Done by: For:

Work@home Business Plan

Table of contents
1 Summary............................................................................................................................................1
1.1 Who..............................................................................................................................................1
1.2 What ............................................................................................................................................2
1.3 How..............................................................................................................................................2
1.4 Key success factors....................................................................................................................2
1.5 Revenue model..........................................................................................................................2
2 The product or service......................................................................................................................3
2.1 Generic services.........................................................................................................................3
2.2 Unique services...........................................................................................................................3
3 Markets and competitors ................................................................................................................4
3.1 The Market...................................................................................................................................4
3.2 The clients....................................................................................................................................5
3.3 Competitor analysis....................................................................................................................8
4 Marketing strategy .........................................................................................................................10
4.1 Marketing objectives................................................................................................................10
4.2 Media plan................................................................................................................................10
4.3 Rollout plan................................................................................................................................12
5 Operations ......................................................................................................................................12
6 Management team........................................................................................................................12
6.1 CEO- ………...............................................................................................................................13
6.2 VP Sales – ……...........................................................................................................................13
6.3 CFO – …………..........................................................................................................................13
6.4 CIO – …………..........................................................................................................................13
6.5 VP Marketing.............................................................................................................................13
6.6 Labour and organisation consultants.....................................................................................13
7 Finance ...........................................................................................................................................14
7.1 Revenue Model........................................................................................................................14
7.2 Operating Costs........................................................................................................................14
7.3 Key Assumptions Underpinning Financial Forecasts..............................................................15
7.4 Sales and Cash Flow Forecasts...............................................................................................16
7.5 Sensitivity Analysis.....................................................................................................................16
8 Risk, return and exit ........................................................................................................................17
8.1 Dimensions of risk......................................................................................................................17
8.2 Backup plan..............................................................................................................................17
8.3 Exit strategy...............................................................................................................................18
9 Appendix 1: Internet demographics.............................................................................................19


10 Appendix 2: Professional Associations.........................................................................................21
11 Appendix 3: Competitors Analysis.................................................................................................1
12 Appendix 4: Detailed procedures.................................................................................................1
12.1 Registration................................................................................................................................2
12.2 Project registration & match....................................................................................................2
12.3 Project development...............................................................................................................2
12.4 Payment....................................................................................................................................3
12.5 Customer service......................................................................................................................3
12.6 Continuous improvement........................................................................................................3
13 Appendix 5: Site functionality by stage........................................................................................4
14 Appendix 6: Financial details.........................................................................................................5


1 Summary
Work@home represents an exiting new opportunity for the Italian and European market. It
acts as an intermediary between Experts (suppliers) working remotely and individual, small
and medium Companies (SMEs) (customers) needing to gain access to expert advice and
outsource internal functions not justified by their limited scale.
Work@home, on the Expert side, banks on the clear recent emerging needs of remote
working, flexibility of work hours and availability of expert capacity. On the company side it
leverages the need to reduce cost but still gain access to valuable resources and – at the
same time - the growing Internet connectivity of European SME.
Work@home benefits from providing unique value to both its customers and suppliers.
Suppliers (Experts) connect to site to look for a project and gain the opportunity to earn and
employ their skills. Customers (Companies) obtain services normally available only to larger
size companies.
In the longer term, Work@home intends to become the work provider of choice for its Expert
community, promoting an entirely new lifestyle for his adepts and insuring some of the
benefits formerly enjoyed as salaried workforce. At the same time, it will prove to Companies
the cost effectiveness of outsourcing most non-core functions, pushing them to get rid of
most administrative functions. In cost terms, the falling cost of transacting among individuals
will not justify anymore a firm’s size beyond the one supported by core activities.

SUPPLIERS
SUPPLIERS CUSTOMERS
MERS
Value added
services Projects
Experts Work@home Companies
Projects Quality Work

1.1 Who
• Expert. An Expert is a person who is qualified in a specific domain that is valuable for third
parties. For example, if the client need a web design service, an undergraduate degree
in design can be sufficient to qualify, while if the project is about legal advice, a
professional qualification plus multiple years of experience might be needed. The level of
expertise needed for each service is freely determined by Companies and Experts. The
benefits for Experts to collaborate with work@home are that they get easy access to a
wide array of project opportunities all over Italy that they could never get on their own.
They are provided with all the necessary tools to interact remotely with their clients, as well
as complete outsourcing of the legal and invoicing hassle. They get general counselling
on taxes (how to manage extra revenues), project management, etc.
• Company. These might be individuals, or small/ medium companies, that have a specific
need that is temporal and requires expert advice. They benefit from a efficient way of
finding pre-qualified expert advise that is (I) cost effective, (ii) difficult to find elsewhere,
and (iii) when needed, and only for the time needed. They also don’t have to worry
about legal and labour issues. They get general counselling on how to better present their
needs (convert problems into project specifications), intelligent search (by expert profile,
by domain, by geography), etc.

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1.2 What
Work@home site will offer two services to Companies:
• Expert advice. It will comprise professional services in short-term periods (1-4 hours, that
can be responded in a single email). This advice will be delivered by email.
• Project development. Long-term projects in periods of some weeks.
Services will include web development, writing, Internet, marketing & creative, personal
assistant and research. The criteria of domain selection is that they are easily delivered
remotely and on-line and do not require lots of input from the company (i.e. tax forms, that
requires lots of input from the company).

1.3 How
Work@home will formalise the process of finding and engaging external resources by finding
qualified experts for different project needs, certifying them and matching them with the
project needs of the companies posting the projects in our site.

Need of Find an Chose one Receive
outside external and engage service
help specialist service and pay

We will run a recruiting campaign for both experts and companies, will have the necessary
infrastructure to manage database, communication and search tools, and expert staff to
personalise the relationship with Experts and Companies.

1.4 Key success factors
• Unique value proposition. to Experts, based on emerging demographic and lifestyle
trends; Compelling value proposition for Companies, based on cost containment and
access to services otherwise not justified by the size of our target enterprises.
• Build critical mass. Build awareness of the service, followed by an intense educational
campaign to teach Expert and Companies of the benefits of the service. Next, lock-in of
our targeted experts by the provision of value added services.
• Technical platform. Standards IT platform, database management, communications, etc.

1.5 Revenue model
The revenue model is based on a percentage of the transaction fee completed, plus fixed
prices for advise calls. Additionally, there is potential for additional revenue from
advertisement.

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2 The product or service

2.1 Generic services
These are the commodity services that support the process of finding and engaging external
resources.

2.1.1 Experts
We provide the following services:
1. Registration. Work@home collects information of experts of different expertise domains.
For some domains, Work@home will pre-qualify experts before registration with the
appropriate tests.
2. Advice. Work@home counsel experts on how their experience can be converted into
valuable external services, how to classify it, how can it be priced, how to prepare a
proposal, etc.
3. CV certification process. Work@home offers their clients a certification service through
third parties. I.e. World Information Network, LLC, specialised agencies.
4. Sourcing services. Once registered, the Expert can browse on the posted projects and bid
for them.
5. Administrative & legal tasks. Work@home will manage the contractual responsibilities of
the work agreement. They serve as intermediary of the work exchange, taking all liabilities
of labour contract from the client. Work@home will also provide free advice on tax issues.
As of the payment, once the project/advice service has been provided, Work@home will
charge the Client and pay the expert as he chooses to.

2.1.2 Companies
We provide the following services:
1. Converting needs into advice/ project requirements. Work@home helps the client in their
search process, by helping them translate their need to an external resource service
2. Certified candidates. Work@home presents a list of Experts for each service required.
Experts will be certified on their credentials and rated by previous users.
3. Intelligent search. Every time a Company post a project/ advice service will be presented
with a list of experts that best answers its needs.
4. Administrative tasks. Work@home will manage the contractual responsibilities of the work
agreement. They serve as intermediary of the work exchange, taking all liabilities of
labour contract from the Company. As of the payment, once the project/advice service
has been provided, Work@home will charge the Company and pay the expert as he
chose to.

2.2 Unique services
Here we mention the unique services that we consider will differentiate and build brand
loyalty to work@home:

2.2.1 Ecommerce
Work@home will partner with commercial providers of financial services (insurance, account,
investment products), continue education, books and any other product or services that
might be of interest to the Experts community. We will make sure that the products offered to
this channel address specific needs of our Experts and that they get a good deal.

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2.2.2 Project management tools
Work@home will provide a “workplace” on the Web to the Expert to work with its client. This
will include project management tools (calendar, electronic agenda, project management
scheduling software, etc.) as well as communication tools (forum, chat, email, etc.) to
exchange important documents, such as additional information and drafts of the project,
and project feedback.
Experts can also keep track of their progress. A record will be kept of all messages concerning
changes and additions. Expert delivers final draft of the project and request sign-off from the
Client. If for any reason the Expert and the Client are unable to agree a final version and sign-
off on the project, the expert has the option to call in the Moderation process.

2.2.3 Commerce and Content
A compelling alternative is to form an Expert Community per domain (i.e. internet, editors,
lawyers) that is sponsored by Work@home where members can freely exchange information,
ideas and knowledge. All the communication tools (chat, forum, email) will be enabled. To
enrich its content, Work@home will bring content from specialised magazines, SME (subject
matter experts), etc. This initiative will strengthen brand loyalty and stickiness to the site.

3 Markets and competitors

3.1 The Market

3.1.1 Internet in Italy
Il Sole 24 ore – the highest diffusion economic paper in Europe - estimates the number of user
online for Italy to be 4.7 million in June 2000. Germany and the UK, for reference have 13.5
and 12.4 million respectively. The number of SME connected to the Internet will increase from
1,100,000 in 2000 and double by 2002. BCG estimates “online” turnover to be worth in 1999
220 Bn Lire, split among 61% for dot coms and the rest for clicks and mortar enterprises. In 1999
85,000 new domains have been registered in the country. For a detailed discussion of Italian
Internet demographics see Appendix 1.
On the whole Italy is still not as developed as the US in the e-commerce arena, or as Northern
Europe, but the momentum is growing. Italy is prospectively considered to be one of the
highest growth regions in Europe, Internet-wise, with access projected to double next year
and increase significantly the year after.

3.1.2 Target market
Our target market is constituted on the supply side by Italian professionals, on the demand
side by individual, small and medium size enterprises.
A good way to proxy the market on the supply side is to look at professional associations. This
is by no means exhaustive, since there are many professions which emerged or gained new
importance with the “new economy” (software programmers, one for all which are not yet a
professional body, due to their more recent appearance). At the same time the professionals
market does give a feeling for the market potential of our service.
On the demand (customer) side, suffice it to say that, as well known, individual and SME
below 20 employee - our intended target - in Italy account for 85% of the total number of
firms, for a total number in 1999 of approximately 50,000 and create approximately 24% of the
country’s value added. In 1997 9.2% of these companies have subcontracted out work and
11.9% have worked as subcontractors.

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3.2 The clients

3.2.1 Buying behaviours
On-line recruitment and on-line services connected to the job market are one of the big
opportunities opened up by the new economy. Job-hunting has traditionally been a
fragmented activity requiring large efforts both from the prospective applicant and the
employer. Internet offers the possibility to improve the visibility on the market for both parties,
and goes one step ahead on the way towards providing them with perfect information.
We will briefly cover the basics of online recruitment, since it is the sector most closely related
to our own, and the one from which we could mostly suffer substitution or retaliation. We will
also use the estimates provided by Forrester1 aimed at the American market as a proxy for
the European market and the interest for our service.

3.2.2 Supply side (Experts)
Forrester estimates the online recruitment market to be worth $ 7.1 Bn by the year 2005. Given
the relative size of the European and American economies, and the lower Internet
penetration rates achieved so far in Europe (presently around 14%), we should expect to
correct the figure downwards for the old continent, but not excessively.
Figure 1- Use of Internet for job search - shows the willingness to use the Internet as a job
search tool by the Internet community.

Figure 1- Use of Internet for job search
Those who have actually used the Internet do not show high levels of satisfaction for what
they have found (Figure 2 - Satisfaction with on-line job)

Figure 2 - Satisfaction with on-line job offers
Finally it is interesting to note that most of the actual success still stems from more traditional
job-hunt techniques (Figure 3 - How the job was secured). Only 4% of the interviewees have
secured a job via the Internet.

1
Forrester, Career Networks, February 2000
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Figure 3 - How the job was secured

3.2.3 Experts Profiles
We segmented our Experts in the following groups:
• Professionals: those are the people belonging to professional bodies – 2,440,000 – see
Appendix 2. Most of these professions require a long trainee program and state exam
before these professionals are able to practice in their own right. We will capture them in
between. An estimate of this number is provided by the professional belonging to the
younger segment (25-40) - 24.7% assuming the same distribution of age groups as for the
population at large - thus 602,000 people. For a detailed discussion of the professionals
segment see Appendix 2.
• Young unemployed graduates (high school and university). Those encompass many
disciplines: lawyers, tax advisers, engineers, statisticians, business advisors in the university
sub-segment but also IT technologists, accountants, technical designers and so on in the
high school sub-segment. ISTAT - the national body for statistics - estimates university
graduate unemployment to be 23.7% three year after graduation and high school
graduate unemployment 35%. The potential pool of young graduates in the age bracket
25-30 is thus approximately 500,000 units. To those we shall add the high school graduates
still looking for employment (35%) in the age bracket 20-25, 800,000 units, and university
students at large - 275,000.
• Senior citizens and retiree. A common concern of people approaching retirement age is
what to do with the newly available time. Many forego generous early retirement not out
of economic concern, but in connection to fears for the lack of an intellectually
challenging way to employ their time. Work@home would provide for the need and
supply an additional appreciated economic incentive. The number of university graduate
inactive people over 64 is approximately 680,000.
• Part-time workers: adding up independent and salaried part timers we obtain 1,600,000
workers. Taking the graduate fraction we obtain 350,000 units.
• Quality of life choices. An emerging social trends is the number of people who accept
lower paid jobs or positions of lower responsibility to have more time with the family or
pursue the quality of life option. Work@home would be uniquely positioned to bank on
this trend, enabling self-demoters to fully control their work schedule. As a proxy for the
group Istat estimates inactive people willing to work, but not actively seeking to be
around 2 million. Graduate percentage should run around 120,000.
• Expectant and new mothers. A common concern to new mothers is the time off the job.
Work@home would provide a way to put to fruition their professional skills during early
motherhood, enabling them to remain off the job for longer than the guaranteed paid

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period of three months. Istat estimates the number of births to be 532,000 per year.
Graduate mothers should thus be around 125,000.
The total of the targeted segment is approximately 3,452,000 people.

3.2.4 Demand side (SMEs)
On the demand side we see the totality of online employers using job posting as the way to
communicate an opening (Figure 4 - On-line recruitment by recruiters).

Figure 4 - On-line recruitment by recruiters
Forrester also considers online recruitment to be coming up as the preferred way to recruit in
the near future (2004).

Figure 5 - Budget allocation

3.2.5 Company’s profiles
Our target market is constituted by:
• Individual firms. Those are the people who have a partita iva (fiscal code for commercial
activity) work mainly in a consulting function to enterprises and the public administration
and are in need supporting professional services (tax expert, legal expert and so on). Istat
estimates this segment to be constituted by 2.5 million “entrepreneurial units”, with a total
of 4 million employment. It is obvious in this case that there is large potential to attract
supplier (experts) as customers and cross-sell among the site community constituencies.
From interviews with them, we learned that the key for these overworked people is time.
Many have far to many things to cater for and would more than welcome sourcing some
of their administrative duties to third parties. Activities like preparing paying slips for
associates, tax and legal advice, regulatory compliance are on top of the agenda.
• SMEs. Ideally the smaller ones, under the 20 employees footmark. Buying behaviour of
theses firms as elicited through selected interviews, is to be referred to a professional
either through private or commercial acquaintances, or alternatively (and secondarily)
use professional associations. We believe that the cost of contacting and contracting the
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professional can be immensely reduced using our intended service, and most potential
clients have shown interest in our offer.
From our research, we know that those entrepreneurs tend to have a network of contacts
already in place. They normally have an external lawyer, an external tax expert and so
on. Nonetheless they showed enthusiasm – to say the least – for the service. The concern
is the cost associated to contacting their external professionals, sometimes to get only on
the spot advice. They often perceive the need to get timely, concise and cheap advice
and see the Internet as a potential way to deliver it. Other promising areas are one off
repeat services such as quality certification, compliance to workplace security regulations
and other such requirements. Technical firms also showed interest to get technical advice
in areas of non-core expertise, such as a thermal appliance design firm needing advice
on ventilation systems.

3.2.6 Buying behaviour associated risk
It should be noted that individuals in Italy tend to be socially “connected”, probably more
than in northern Europe and the US. This implies that somewhere in the social network there
might be already somebody able to offer a service similar to the one needed by the
entrepreneur. Our service still has the advantage to offer speed of access to the service,
transparency and breadth of offer.
Italians are smart people by definition, trying to find ways around impediments and,
sometimes, even regulation. There is a concern that customers might try to exploit off-line
contacts developed online, effectively hampering the revenue potential of our service. We
believe that by keeping the site the focal point for the provision of the service (with the aid of
technology) the issue can be minimised and eventually resolved altogether.

3.2.7 Conclusion
The online job market has a promising future both in the US and Europe. The Internet lends
itself perfectly to play the intermediation role previously played by recruitment agencies. In
addition it offers a much more effective way to match demand and offer, given its intrinsic
ability to link and aggregate easily information. Our concept, to provide projects and
facilitate part time work, has the potential to address some of the dissatisfaction highlighted
by users in the previous demand section and attract both relevant skilled remote workforce
and supply for the perceived needs of targeted businesses.
It is more generally a novel way to perceive work relations and potentially opens up the way
to a new paradigm for working altogether.

3.3 Competitor analysis

3.3.1 Overview
The competitive landscape for online recruiting and job related services is rather aggressive.
As typical of intermediaries, it is an industry with limited barriers to entry. Off-line players can
typically leverage certain assets in their online offering:
• brand
• applicant pool (CVs)
• suppliers relations (preferential relations to companies that provide job offers)
New entrants are at a disadvantage to establish a reputed brand and to build critical mass (it
requires time and effort), but, as in many other instances in the online world, generally
provide leaner and meaner business models better suited to take full advantage of the
specificity of the Internet.
Several pure players have entered the space recently. Now, let’s pause for a moment. In a
world (the Internet) where even the cautious agree that time is hugely compressed and more
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valuable than anywhere else, we observe one industry - online recruitment and job services -
that shows many players having only very recently - in last two years - established a foothold.
This comprises the US as well (see for instance exp.com).
In Europe the job services market is rather crowded, but in only one instance have we come
across a player that offers something substantially similar to what we intend to
(Smarterwork.com).
In Italy the situation is even more promising, as there is a large number of sites catering for
recruitment and demand and offer matching for traditional jobs, but no players are
dedicated to our own segment.
Now, given the fact that no European Internet business can survive without having – at least –
continental ambitions – we estimate the delay in deploying our resources elsewhere in
Europe to our closest competitor Smarterwork.com to be around one year. That implies that
we will target European expansion first to countries where our competitor is not yet
established.
In Italy we want to become market leaders in our segment, by virtue of being the first to offer
our service and by providing increased value to our experts.

3.3.2 What the others are doing
The table in Appendix 3 offers an overview of what our competition is doing.
We tried to be as loose as possible in defining our competitors, trying to incorporate those
who are not directly playing our game, but whose game could easily be turned or make an
inroad into ours.
We limited our due diligence to online players, although it is obvious that, especially at the
beginning, we will be capturing share from the offline recruitment and agencies. At the same
time, we do believe that we constitute such an innovation for the market that we most
effectively should benchmark ourselves against pure players.
To sintetise the rather extensive matrix by saying that only one player has penetrated the
market with something similar to what we want to do (Smarterwork). Our advantage is that
we are coming out from the bushes having a full understanding of what our competitor is
doing, whereas we will be a surprise to them.
The other business models are interesting to look at, in term of what other potentially well-
informed and entrepreneurial people have been willing to set up. It goes without saying that
in these processes we found both confirmations of what we considered possible to achieve
and extensions of our own concept.
What is strikingly clear is that without value added to the user (both corporate and individual),
we have very little to sustain and defend our competitive position.
This battle will be played and won on:
• Speed (first out in the Italian market to reach critical mass, then subsidising expansion in
other countries from a position of strength)
• Value, in this case in its meaning of level of service provided by the user. Nothing else in
this business is fully defendable.

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For a graphical representation of our intended dimensions of competition, see the following:

competitive positioning

120

100

Work@home
80
Smarterwork
effectiveness

Consulteque
Manager
60
Amleto
Bancalavoro
Jobdirect
40
Nogapwork

20

0
project or job value added to outsource or technology and scope of offer italian market
related user insource referred look and feel of related
work site
dimension

Figure 6 - Competitive positioning

4 Marketing strategy

4.1 Marketing objectives
• Create a critical mass of Experts and Companies
• Build a brand that stands for a quality service provided to Experts and Companies
• Build awareness, encourage trial, repeat usage
• Create stickiness to the site2
• Get new and repeat visitors, Experts and Companies

4.2 Media plan
The whole marketing strategy will be supported by a PR agency, an on-line agency, plus the
local marketing support of Work@home, and its based in the initial understanding of our
customer profile, that will be updated constantly by our continuous improvement efforts.
Work@home advertising campaign targets two different group of customers: Experts and
Companies (sub-divided in companies and individuals looking for help), and therefore has
advertising efforts to reach each group.
A number of campaigns will be pursued concurrently, with an even spread on spending
between the campaigns. The advertising and promotion campaign will be split between on-
line and off-line, with the majority going to off-line campaigns. PR and marketing campaign
will be split geographically with a particular focus on the regions of the south where there is
an oversupply of qualified workers.

2
Avoid that Experts and Companies bypass the site after the first project
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4.2.1 On-line advertising
Work@Home will initiate an on-line advertising campaign with an online advertising agency
(i.e. Doubleclick.com). The forms of advertising will be:
• Banner ads.
• Barter deals with other sites. Some identified portals are Virgilio.it, tin.it. Possible alliances
with local newspapers.
• Viral marketing: ‘E-mail this to a friend’ buttons to encourage new visitors through referral.

4.2.2 Off-line advertising
• Print. Newsletters will be faxed to local radio stations and newspapers, and ads (or inserts)
will be placed in local newspapers and school newspapers. Ads will also be placed in
targeted magazines.
• Co-branded Merchandise and Promotions
• Branded stationary. Work@Home will put its name on stationery to build brand awareness.
We will also give away free branded merchandise on trade shows and conferences, such
as hats and t-shirts.

4.2.3 Public Relations
• Web Cards (postcards of the web-site) will be direct mailed to PR contacts and other
targeted customers.
• Editorial letters. The management team is also writing ‘Letters to the Editor’ to local
newspapers and building relationships with local journalists.
• Trade shows presence. Work@Home will attend trade shows and conferences to
generate brand awareness.
• Universities presence. The management team will visit universities and professional schools
as guest speakers to help build brand awareness.

4.2.4 Partnerships
Reciprocal relationships will be sought with web-sites that could link to Work@Home:
• Portal sites. Work@Home will be listed in the top Internet search engines. They could
complement their offer with an on-line labour-related partner. Currently, the Italian
partners doesn’t have a partner or an offer around on-line recruiting for projects or
permanent positions. Popular rankings of search engines will be reviewed periodically to
ensure Work@Home continues to be listed on all key engines.
• Sponsored sites. Organisations focused on the collection of European Community funds
and “fondi per il mezzogiorno” (subsidies for the south of Italy). We believe there could be
significant branding opportunities through alliances with them.
• Complementary sites. Office supply, hardware/software and training companies. In
particular, we believe that there could be significant room for companies that rent
software that might be required just for specific projects. Online training companies are
an ideal partner to train Expert on specific subjects.

4.2.5 Sponsorship
Sponsorship is an attractive way to build brand awareness with targeted groups. Areas that
will be explored include Expert work to offer local community services, and “build/ enhance
the web site for your university” campaign.

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4.2.6 Other strategies
The provision of a free service - expert email advice – might be a way to attract Companies.
For the Experts, this might be a form of access to projects supplied by the companies.

4.3 Rollout plan
The official launch will begin at January of 2001. It will entail a heavy media campaign that
will be led by a selected PR agency. Based on the success of the campaign and lessons
learned, this media blitz will be repeated in occasion of the pre-holiday seasons June/July
2000/1 and November/December 2000/1, since these are the period in which Companies
are more likely to suffer lack of internal supply and Experts can have more free time.
The main site launch is foreseen five months after the site is running to ensure that the basic
functionality is fully tested, has reached a satisfactory level of working functionality and has a
sufficient number of posted projects. The first site users (prior to official launch) will be more
technologically educated and therefore ready to cope with a non-perfectly functioning site.

5 Operations
The processes to support the generic services are registration, CV advise, project match,
project wording, project development, payment.
The initial site functionality will include:
• Registration
• Search function (for Expert profiles/ Project)3
• Project posting
• Work@home advise (for Experts/ Companies)
The web hosting, operations and communications infrastructure will be outsourced. The site
development and further updates will be done by an agency. In the future, we can find
experts for further developments using our own site. As the sites grows, we will gradually bring
operations in-house, to leverage on economies of scale.
There are other internal processes that will sustain the quality and timeliness of our
improvements. The main one is market research, that intents to obtain information about our
customers to continuously improve Work@home offer, create new services, understand what
new expertise domain areas are in demand, etc.
The aforementioned processes are explained in detail in Appendix 4. Future site functionality
is included in appendix 5.

6 Management team
At the development, seed finance, the management team is integrated by ……. The team:

3
A metafile with relevant search words will be attached to the front page of the web-site to
increase traffic.
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6.1 CEO- ……….

6.2 VP Sales – …….

6.3 CFO – …………

6.4 CIO – …………

6.5 VP Marketing
To be recruited. The required profile is Internet marketing strategy with deep understanding of
the Italian market.

6.6 Labour and organisation consultants
To be recruited. Consulting advise for legal matters, and somebody who has either a previous
experience with the PA, ministry for work - or previous experience with professional orders. A
politically well connected individual would be a plus. This people could be headhunted out
of their (cheap) positions.

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7 Finance
Work@home is expected to turn its first profitable month in March 2002. The company will
seek 500,000 Euro financing to support the set-up costs while we expect to rise at least
1,000,000 Euro early next year to scale up the web site and support our marketing strategy.
Please refer to Appendix 6 for additional financial details.

7.1 Revenue Model
Work@home has three main sources of revenues: commission on projects done, commissions
on calls for expert advise, and advertisement (as side revenue source). Below are the details
about Work@home revenues in the first 5 years:
Revenues 2000 2001 2002 2003 2004
Advertising 120 10.845 28.448 29.407 58.813
Commissions
from JE4 1.800 236.684 742.815 1.470.326 2.940.653
projects
Commissions
from SE5 870 101.587 290.867 588.131 1.176.261
projects
Commissions
400 83.541 408.196 852.789 1.705.579
from calls

Total 3.190 432.656 1.470.326 2.940.653 5.881.306

• Commission Revenues. Work@home will receive a 10% commission on the value of the
projects placed on the site once they are signed off from the clients. Individuals seeking
for experts advise will be charged a flat fee for each call.
• Advertising Revenues. Work@home will generate advertising revenues by selling banner
space on its web site. Revenues are determined by the number of impressions and cpm6.
However, because of our web site is highly specialist we do not expect huge revenues
from this source.

7.2 Operating Costs
The principal costs of Work@home are advertising, salaries, content, site development and
maintenance, and general overheads.

4
Junior Expert
5
Senior Expert
6
Cost per thousand impressions
14


Costs 2000 2001 2002 2003 2004
132.3 43 581 882 1.764
Salaries
00 6.400 .100 .196 .392
Site
120.0 4 147 294 58
development &
00 3.266 .033 .065 8.131
Web Maint.ce
40.0 49 397 882 1.764
PR & marketing
00 3.851 .097 .196 .392
General 78.0 17 174 294 58
overheads 00 4.769 .769 .065 8.131

Total 370.300 1.148.285 1.299.998 2.352.522 4.705.045

• PR and Marketing expenses. This is based on the marketing strategy and roll-out plan.
• Other Key Expenses. The site will be under continuous development until December 2001
to ensure all the key features are available at the right time. Maintenance will increase
substantially starting from year 2001 as the number of visitors and features increases
substantially. Work@home does not face any cost related to the production and
inventory of goods since it does not sell any physical stock.

7.3 Key Assumptions Underpinning Financial Forecasts
1. The number of experts enrolled and the number of clients posting projects continue to
grow on the back of advertising, new content and the introduction of additional services.
However we believe that not all the experts that join the site will be actively involved in
the fulfilment of projects and we are going to distinguish between active and not active
experts. We are considering the following monthly growth rates:
January Monthly growth Monthly growth
2001 rate for 2001 rate for 2002
Junior Experts 3,000 10% 5%
Active junior 300 15% 5%
experts
Senior Experts 600 5% 5%
Active senior 120 15% 5%
experts
Individuals seeking 120 40% 40%
advice
Projects posted for 80 10% 10%
JE
Projects posted for 30 10% 10%
SE

15


2. Impressions remain at around 50% of page views (due to search engine traffic being left
out of impression count).
3. The charge for expert call will be Euro 50
4. Commissions on projects and calls are 10%.
5. Marketing acquisition costs are determined as Euro 15 for experts and Euro 40 for clients
who post a project or ask for advice.
6. The average number of page views per visitors per month is 10.
7. The average cpm is Euro 25.
8. Site development costs are 10% of revenues.
9. Expenses for site development are capitalised as they occur
10. Effective tax rate is 35%

7.4 Sales and Cash Flow Forecasts
According to the above assumptions, Work@home will be able to generate in the first 5 years
of activity the cash flows indicated below:
2000 2001 2002 2003 2004

Revenues 3.190 432.656 1.470.326 2.940.653 5.881.306
Cost of Revenues 370.300 1.148.285 1.299.998 2.352.522 4.705.045
EBIT -247.110 -702.363 284.044 820.450 1.644.566
Applying a P/E ratio of 20 and a discount rate of 40%, we have a present value for the
company of about 5.5 millions Euro.

7.5 Sensitivity Analysis
The table below indicates the business’s sensitivity analysis to adverse scenarios. The key
assumptions have been halved or doubled to assess the impact on the business.
Present value @
EBIT in 2004
40%
Base case 1.644.566 5.565.223
Commissions halved 831.970 2.815.391
Demand growth rates halved 581.859 1.969.015
Marketing costs doubled 468.305 1.584.748

This analysis illustrates the robustness of the business to adverse shocks. The extent of this
robustness is due to the high gross margins and the scalability of the model. The worst case
happens in the hypothesis that marketing expenses doubled. However, we feel that this
hypothesis is highly improbable because there are no competitors in Italy at the moment,
Internet penetration is constantly increasing among individuals and small and medium firms.
Furthermore, the level of attention towards flexible work activities and part time jobs from
both political and economic organisations is to the highest level ever.

16


8 Risk, return and exit

8.1 Dimensions of risk
Besides the uncertainties related to the evolution of the strategic scenario, we believe
work@home is particularly subject to the following dimensions of risk:
• E-commerce legislation. The Italian government, so far luckily uninvolved with
development of the Internet in the country, has recently turned its legislative attention to
it. Partly following EU directives for consumer protection has put in place a legislative
framework that closely resembles the one for direct marketing sales, on the assumption
that the two fields are closely related. In particular there is a set of principles regarding
consumer dissatisfaction with the product or service and the obligation for the firm to
refund in full the consumer in that instance that could hinder our freedom to exert a
quality control on the services offered through the site. We could potentially be held
responsible for the ultimate quality of the work and appropriate legal counter measures
have to be established (contractual framework) to avoid the issue. It is also still the case
that for the online provision an invoice has to be produced, thus putting the extra burden
on our organisation of maintaining a billing system delivering the bill to the client.
• Legal liability. As above mentioned, the nature of the service provided through the
website exposes the company to legal action in the event of client’s or expert’s
dissatisfaction. Potentially the company could be held responsible for the negative
consequences arising from poor quality or late work, thus exposing the company to
liabilities higher than the value of the work actually carried out. A talk to an Italian layer,
LLM at the City College of London and specialising in e-commerce law clarified that a
contract can be put in place with appropriate disclaimers to protect the company.
• Market acceptance. the company is potentially exposed to the scrutiny of the market for
the new service.
1. The market might find the service unattractive or too innovative.
2. The customers might not like the business model and might not be willing to relinquish
a fraction of their contract work value.
3. Customers might be able to provide for experts using their social network
4. Customers might use the site to gain the contact, then try to exploit it offline
5. Suppliers might be unwilling to outsource projects of short duration
6. The site might find it difficult to establish a name for itself and route traffic to it
• Competition. The site is exposed to competition, particularly to international competitors
making a lead into the Italian market.
• Scalability. The company might find it difficult to follow its expansion plans, due to
differences in the different European markets and difficulty to hire internationally
• Financial projections. The company might have problems too meet its financial
projections, due to unforeseen developments in the market or to the difficulty to stick
timely to the plan.

8.2 Backup plan
The flexibility and scalability of the service offered enables us to roll out a test product(s) and
gauge demand for it in relatively little time and with little resources (see plan ??).
In the unlikely event that a major Italian competitor comes out in the close future with a
similar offering, we might explore the possibility to buy them out or merge with them. Should
the competitor be backed by larger resources we could increase our own commitment or
exit.
17


In the event that a leading International competitor accesses our market (see Smarterwork),
we could consider a trade sale or a competitive reaction depending on the relative stage of
development of our offer vis a vis theirs.
In both instances, we strongly believe that our enhanced expert value proposition will protect
our competitive position.

8.3 Exit strategy
Given our first entrant advantage and the relative underdevelopment of the Italian (and
European) market for the dimensions we wish to compete in, we believe to be in for the long
run – at least three years.
We believe that during these three years we can create 5,5 million Euro of value, taking the
company from the seed value of 500,000 to our estimated EBIT of 1.6 million Euro in year five.
As depicted in the previous paragraph, we might contemplate an early exit, in the event of
an unforeseen competitive reaction, or an entry by a larger scale player, killing off our early
market. We still believe to be able to provide value to an acquirer through a trade sale, who
can turn out to be:
• our competitor, in the attempt to leverage our own industry contacts, the team, the
technology
• an offline job service market player wanting to establish an online presence (temporary
management agencies and so on)

18


9 Appendix 1: Internet demographics
According to most sources, over 10 million people have access to the Internet today in Italy7.
This represents almost a sixth of the population, and only one half of the people that own a
mobile device. If compared to the US that has penetration rates close to 50%, it is not a lot,
but still a rather good result for a country that has picked up on the Internet fashion rather
recently.
Reported in Figure 7 - online population by profession – is a breakdown of professions of
“wired” people in Italy. Professional qualifications account for over 24% of the sample.
College students and remote workers add another 18%. It is definitely the case that today
being online in Italy correlates well with being professional.
This population typically constitutes the target for our initiative, estimated at 3.45 million.
From Figure 8 - Online population: age breakdown9 - we perceive that the online population
is gearing towards the younger segments, a sign of the recent speeding up of the Internet
penetration. Italians have traditionally been averse to the electronic medium and are only
recently catching up, due to stimuli coming from different sources (TV, friends who are online
already, demands posed by their job). E-mail and the national passion for “connectivity”
(being in touch with each other) is playing a crucial role. It is often the younger generations
who are forcing parents to take a closer look and familiarise themselves with PCs.

Italian Internet Population Professions
Unemployed
1%
Salesmen
Teleworkers 4%
2%
Pensioners
Other
4%
19%
Customer support
Unemployed
5%
Teleworkers
Managers Salesmen
8% Pensioners
Customer support
Managers
Students (College, Professionals
Professionals
University) 10% Technicians/Engineers
19% Students (High School)
Students (College, University)
Other
Technicians/Engineers
11%
Students (High School)
17%

Figure 7 - online population by profession8

7
This in not in contradiction with 4.2.1, since access does not imply a proprietary connection.
8
Data from Yahoo Italy
19


Age brackets

45-54

35-44

30-34
Age bracket

25-29

21-24

18-20

13-17

0-12

0 2 4 6 8 10 12 14 16 18 20
% of online population

Figure 8 - Online population: age breakdown9

9
Yahoo Italy website
20


10 Appendix 2: Professional Associations
According to ISTAT, the Italian Organisation for statistics, in 1997 there were over 1,5 million
professionals members of professional orders – professional bodies whose belonging is
formally regulated by the State after the completion of the relative course of studies and a
public exam. At the same time 990,000 were members of professional associations, privately
organised bodies caring to similar needs, but relative to professions that are not regulated by
the State. Overall the number of professionals, in 1997, was over 3 million people. Employed
people, always according to ISTAT, total 20 million for Italy. This implies that professionals
account for more than 16% of the active population.
There is a clear trend for fast increase in those numbers, since in 1987 the number of
professionals totalled only 800,000, with a combined increase to 1997 of 62%. The number of
professional bodies grew in the meantime from 23 to over 30.
It has to be stressed again that professionals - self-employed highly skilled people - do not
constitute the entirety of our target market. Although notaries, layers, tax specialist, accounts
and the likes are ideally suited to bid for the type of projects that are likely to be on our site,
more interest will arise from a much larger segment of the population. Young IT experts, part
time workers, people temporarily out of the workforce (expecting or new mothers), people
who have recently retired or who have done “lifestyle choices”, accepting lower paid jobs to
have more available time, but interested in complementing their earnings, will all be part of
our target market.
Even this “enlarged” market will only constitute an initial and transitory phase. The vision is for
the creation of a real remote workforce, able to connect from no matter where, and carry
out systematically the work resulting from project bids.
Availability of skilled and reasonably convenient workforce would motivate firms to rely
always more on “remote outsourcing” for non-core activities. The systematic presence on the
site of a long pipe of projects would convince more people to rely on the site to earn a living.
The two concurrent events would create a typical self-reinforcing virtuous cycle.

21


11 Appendix 3: Competitors Analysis
Offering Marketing Features Process Description of business Notes
model
International

E-lance • Web-site • Affiliate program • My elance • Define project • Project bidding site
development • Elance-community • Post bid • Fixed price capacity
• Translations • Message board • Define winner bidding site: the user
• Business • Provide workspace for • Perform project offers his services at a
• Computer projects • Rate results fixed rate per hour
• Education • Communicate to bidders • Post fixed cost services
• Engineering during process • Money is transferred to
• Family and • Some areas are backed the expert account
households by credit card payment once a month
• Financial • Site Search
• Legal
• Marketing
• Medical
• Personal
• Travel & Enter
• Miscellaneous
Smarterwork • Internet services • Partners program: • My Office: a private area • Client posts a project • They take cut of 10% of • an attempt to create a
• Marketing and form of co- to facilitate getting the • Client is matched with the value of the project virtual smarter
creative branding. A work done an expert workforce
• Personal customised • English, German and • Client and expert • Harvard and Insead
assistant version if the site is Chinese versions of the site develop the project mbas det it up, access
• Research built with the available (planned in • Sign off and payment, to UK professional
• Web design partner that French, Spanish, Dutch subject to quality agencies through VCs
• Writing receives a fee for and Scandinavian) approval in case of and important strategic
• Suggestions referral • Feedback for both client complaint by the partners (BT, Lycos,
• Legal • Banners and expert customer Intuit)
• Business • Affiliate program: • Experts are screened with
consulting 2 dollars for each online tests
• SW person referred • Online payment system
development already in place
• Quality control
guaranteed by an
“independent moderator”
Exp • Marketing • Referral program • My Exp • Find an expert • Remote expert advice Innovative and recent
• Business • Find an Expert • Formulate a question • not stated what they
• Financing • Advice from leading (email, telephone or charge and how –
• Accounting Scholars videoconference) probably a mark up of
• Start up • Express Connect • Get the answer listed expert prices

1


model
• Legal • Register as a member or • Pay and rate
• Finance an expert • They always act as the
• Health interface, thus are able
• Career to control all traffic
• Education
• Family
• Home
• Travel
• Arts
• Internet
• Software
• Hardware
• Web
development
• Database
• Operating
Systems
• Telecommunica
tions
• Design
• Consumer
electronics
Freeagent • Administrative • Banners • Get work • Get work • Provides the support to • Relatively unfocused:
• Advertising • Co-branded • Business services • Work support business at large anything can be
• architects websites • My e-portfolio • Business services • Very complex and posted, even a full time
• Management • Work support • Network multiple revenue job
Consultants • Network (community) • My e-portfolio streams • No broker fees
• Construction • Area for employers
• Creative • Register facility
• Education • Thematic channels
• Engineering • Skill matching
• executive • Post project
• Finance • Business services
• Health care • Pre-qualify candidates
• Human • Corporate accounts
Resources • Basic E-commerce
• Insurance
• Internet
• Legal
• Media
• Mind
• Real Estate
• Sales

2


model
• Science
• Technology
• Translation
• Travel
• Other
Italian

Consulteque • Finance • Exchange of • Suggest it to a friend • Register as a • Market exchange for • They charge the
• Architecture banners with • Newsletter professional or a professional services. professional for the
• Communication other business • My-page company looking for The professional inserts contact, not the
• Consulting sites • Shared purchasing one his data in a database, service provided. Might
• Info-technology • Discussion forum • Search for a and is matched to be myopic
• Internet • “Windows” a home page professional by skill, relevant demand for • Good effort to provide
• Legal of info and resources location, rate and time his services. extra value
• Marketing elapsed since posting • Professionals are
• Quality, • Browse profile charged for
Environment • Request contact • contacts 100,000 (IT £
and security 30 approx)
• Logistics • to be certified
• R&D • They provide value
added services to the
professionals:
• insurance
• medicine
• fitness
• Home services
• Secretary
• Travel reservations
• Auto emergency
Manager • vertical portal • Banners • Portal for managers • Essentially a • make money out of • emphasis on temporary
for managers • Space on site to • Temporary management “browseable” site with advertising and management
and people who partners (Boyden executive some interesting and referrals • many partnership in
connect from • Referrals recruitment) relevant links and place, even for key
the workplace • Newsletter • Job offers limited value added activities
• Partnerships • Management book functionality
reviews
• temporary work offer
• downloads (sw)
• venture capital
• agenda (Visto.com)
Amleto • Real estate • Referrals • Forum • Send the question and • Provides an array of • flash site – super
• Work wait for the expert to professional and technology (music
• Architecture get back to you promises to answer in provided and a
• Physician 48 hours. Charge pleasure to browse…)

3


model
• Tax 100,000 (51 Euro) upon • Very refined site,
• Finance receipt of the answer possibly one of the best
• Simple concept and in-
house fulfilment of exert
tasks
Bancalavoro • New college • Very refined and • 2 DB • Keyword matching • Banners (1,000,000 to • Ranked number 1
and high school smart level of • CV services or CV 2,000,000 Lit per month Italian job site by Il Sole
graduates offering – • job offers extraction from for a rotational 24 ore, the Italian
• Agents companies pay • search offer databases presence) economic paper
• Freelance for and receive • email news • selection of CVs 10,000
• Hourly workers very different • channels (company, Lit each
• Executives levels of services. employment, franchising, • job offers (from 100,000
• Managers The Cadillac (?) temporary work, remote Lit temporary to
• Employees of job sites (full of work, Search and Offer, 4,000,000 Lit per year)
possibility to public exams, Magazine,
choose optionals) Institutions, Disabled)
Jobdirect • scholarity levels • partner sites • point of entry for • the site does not • automatically matches • low level of details on
• joint marketing • job seeker charge for its services details with offers. Does site
with partner • recruiter • they probably sell some not charge • SMS functionality
magazines (email • They both leave the details kind of first right on the
mention against in a very simple way, and DB to companies (but
advertising the site matches offers and not explicitly) or they
space) demands, than notifies just want to develop
interested parties the base
Nogapwork • Obligatory • partnerships: • Mailing list • Advertising and fee • Charges for the • Unclear pricing, need
employment – search function in • CVs based business services to contact the site for
enables to partnership with • Virgilio search • Very little is done inquiry
comply with Virgilio (number 1 directly through the
laws for disabled portal in Italy) web
employment • Advertising
• Data entry
• Workstation
rental
• Internet
• Archive
• Secretarial
• Telemarketing
• E-commerce
• Graphics
• CAD
• Mailing
• Telemarketing
• Hw & Sw

4


model
• Sw
development

5


12 Appendix 4: Detailed procedures
Stage Experts Work@home Clients
1. Registration Register in site.
Minimal: personal and
expertise
Enlarged: (ver
smarterwork.com)
CV advise Demands help from Reviews CV, CL, etc. to
Work@home to enhance convert to “sales” form
its credentials and proposes changes.
Interaction with Expert until
agreement.
2. Project match Post service need in the
site, by expertise domain

Need advise Reviews need and Demands help from
propose project/ advise Work@home to transform
form, to match expert need to project/ advice
classification and make it form
clearer

Browses for project, Present Client with list of Reviews list and:
classified by expertise most suitable Experts a) Contacts experts
domain (according to expertise asking for a proposal,
and ratings) clarification (active)
b) Waits for Experts
proposal, based on
their posted project
(Passive)

Contacts Clients based on
suitable projects, and
makes a brief sales pitch
and fees

Review proposals, interacts
to clarify any doubts and
decides for one Expert

Closes project bid. Sets
project deadline,
facilitates project mgmt
and communication tools.
Defines payment method
for both parties.
3. Project development Develops project/ advice.
There is constant
communication with the
client as needed

Presents final deliverable

(In case of discrepancy, Clients reviews deliverable
Work@home acts as and signs-off
intermediary)

Gives feedback on Client Gives feedback on Expert
Documents feedback
4. Payment Charge client and pay
Expert, deducting
Work@home commission
Pays fees.
Receives payment (minus
commission).
Optional services.

1


12.1 Registration

12.1.1 Expert
When an expert register, he will be presented a standard page to enter his expertise domain
(to chose from presented options), a brief of it and personal details for contact.
If the Expert does not find a category that matches his expertise, he emails work@home with
his proposed topic of interest. If work@home finds it with potential growth, it will added to the
existing areas.
The Expert will decide on a user name and password, to register in following sessions.

12.1.2 Clients
They enter their personal data (contact details). The Client will decide on a user name and
password, to register in following sessions.

12.2 Project registration & match

12.2.1 Expert
The Expert has two options:
• Browse for projects in its expertise domain; or
• Wait to be contacted by one Client.

12.2.2 Client
The Client has three options:
• Present need to work@home and ask them to convert it into a proposal, and wait to be
contacted by experts;
• Post the project, in one of the pre-set classification. This will bring them a list of the most
appropriate experts to take it (this search is based on % of similarity between the project
profile and the Expert profile – industry, key words in their brief, etc.) The Client can
contact the Experts that most match his needs.
• Browse the available experts list by categories.
Once either Expert or Client contact one another, the Client makes clarification on the
project, the Expert presents a proposal (scope and fees). This two-way communication goes
on until a match is completed.
The match is formalised by signing an agreement (in the form of an OK in a screen), including
the project scope, deadlines and fees. This process is co-ordinated by work@home. If they
have not done so before, Client and Expert have to update their preferred payment method
in their profile.

12.3 Project development
Work@home offers a virtual workspace where Client and Expert can exchange questions,
drafts, chat, etc. They use it freely, without intervention of work@home. Once the project
reaches its deadline, the Client has to sign-off the final deliverable (in the form of another e-
screen). Next, both Client and Expert fill feedback forms, where they rank their counterpart.
This information is then added to the profile of each, for future reference of work@home
users.

2


12.4 Payment
Both the Client and the Expert define their preferred payment method. Normally it will be a
credit card debit and credit. Cheque, e-transfers are also available.

12.5 Customer service
There will be support 7 days a week for Clients and Experts, for the following services:
• Advice in Expert profile and in transforming needs in projects for Clients.
• Website management.
• General questions.

12.6 Continuous improvement

12.6.1 Customer intelligence
• Market research. The basis for market research are: user profiles, web activity analysis and
site surveys.
• User profiles. They will be build on an aggregate level trough site registration required at
both Expert and Company level to access the interactive areas of the site.
• Traffic analysis. Work@Home intends to monitor continuously the level of traffic, origin of
that traffic, and the behaviour of that traffic through web activity analysis software.
• Site surveys. Work@Home will periodically offer site surveys.
• Customer feedback. As part of the generic services provision, Work@home collects
information from Experts and Companies about their level of satisfaction with the service
and suggestions for the future. The Company/Expert reciprocal evaluation will create
stickiness to the web site by increasing switching costs.

12.6.2 Product development
New services and site functionality will be based on the customer intelligence information
gathered.

12.6.3 Competitor analysis
A comparison of top key words will be regularly reviewed between Work@Home offer and
the competition.

12.6.4 Costs control
Spending will be closely monitored to ensure value is obtained from the different marketing
investments.

3


13 Appendix 5: Site functionality by stage
Launch • Site Areas: generic project exchange
• Site Capability: basic bidding system, visitor registration, project
evaluation, transaction handling
+ three months • Site Areas: project area characterised by typology
• Site Capability: community and Work@home basic office (forum,
basic email, free webspace)
+ six months • Site Areas: Small/Medium Business
• Site Capability: Work@Home enhanced office (project
management support, articulated email system). Tax advice (for
Experts).
+ 9 months • Site Areas: ask the expert
• Site Capability: commerce features.

4


14 Appendix 6: Financial details
2000 2001 2002 2003 2004
Statistics
No. of Paid Staff (period end) 0 17 23 40 74
No. of Projects (period end) 35 2.352 7208 14.196 28.393
No. of calls (period end) 50 16.708 81.639 170.558 341.116
Total hits (thousand) 15.000 927.636 2.499.767 2.999.720 3.599.664
Total Clients 100 5.173 7.764 9.318 12.411
Total experts (thousand) 1.000 14.759 25.733 27.985 29.782

Revenues:
Advertising 120 10.845 28.448 29.407 58.813
Commissions from junior experts 1.800 236.684 742.815 1.470.326 2.940.653
Commissions from senior experts 870 101.587 290.867 588.131 1.176.261
Commissions from calls 400 83.541 408.196 852.789 1.705.579
Total 3.190 432.656 1.470.326 2.940.653 5.881.306

Operating costs:
Salaries 132.300 436.400 581.100 882.196 1.764.392
Site development & Web Maintenance 120.000 43.266 147.033 294.065 588.131
PR & marketing 40.000 493.851 397.097 882.196 1.764.392
General overheads 78.000 174.769 174.769 294.065 588.131
Total 370.300 1.148.285 1.299.998 2.352.522 4.705.045

5


2000 2001 2002 2003 2004
Statistics

Operating cash flow 367.110 715.629 170.329 588.131 1.176.261

Capital injection 500.000 1.000.000 0
Taxes 0 99.416 287.158
Dividends 100.000 300.000 500.000
Net cash resources 132.890 417.261 487.590 676.304 1.065.408

6


2000 2001 2002 2003 2004
Profit & Loss Account
Revenues
Advertising 120 10.845 28.448 29.407 58.813
Commissions from junior experts 1.800 236.684 742.815 1.470.326 2.940.653
Commissions from senior experts 870 101.587 290.867 588.131 1.176.261
Commissions from calls 400 83.541 408.196 852.789 1.705.579
Total 3.190 432.656 1.470.326 2.940.653 5.881.306

Expenses
Marketing & PR 40.000 493.851 397.097 882.196 1.764.392
Salaries 132.300 436.400 581.100 882.196 1.764.392
General and Administrative 78.000 174.769 174.769 294.065 588.131
Total 250.300 1.105.020 1.152.965 2.058.457 4.116.914

EBITDA 247.110 672.363 317.361 882.196 1.764.392

Amortisation and Depreciation
Amortisation of site costs 30.000 33.316 61.745 119.825
Total - 30.000 33.316 61.745 119.825

EBIT 247.110 702.363 284.045 820.450 1.644.566

7

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