Dive and Ocean Tourism - Company Investor Deck

1. Investment
Opportunity
Hawkes
Ocean
Sports,
Inc.
h4p://www.hawkesoceansports.com

2. • Vision
–
Harness
the
human
drive
for
adventure
and
explora@on
by
extending
the
capabili@es
delivered
with
our
“fron@er
breaking”
winged
submersible
craF.
• Approach
–
Provide
an
unparalleled
underwater
tour
experience
that
enhances
the
luxury
resort
and
cruise
ship
industries’
porIolio
of
unique
customer
ac@vi@es.
• Introduc1on
–
A
new
tourism
offering
found
in
the
crosshairs
of
the
$40
bn
‘Experien@al’
tourism’
and
$3
bn
worldwide
‘Dive
&
Snorkeling’
tourism
marketplace.
• Leverage
–
Two
decades
of
R&D,
$10MM+
sales-­‐based
funding
and
six
(6)
genera@ons
of
winged
submersible
craF.
• Customers
–
Virgin,
venture
capitalist
Tom
Perkins
&
adventurer
Steve
Fosse4.
• Innova1on
–
Disrup@ve
technology
&
new
genera@on
of
manned
submersible
craF.
• The
Cra9
–
Ini@ally
going
to
market
with
the
6th
genera@on
‘Merlin’
scuba
sub.
• Founded
–
By
world
renowned
submersible
pioneer
Graham
Hawkes.
.:
Hawkes
Ocean
Sports
-­‐
Overview
2
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

3. 3
1995
–
Winged
prototype
2003
–
Prototype
2007
–
Built
for
Steve
Fosse>
2008
–
First
unit
built
for
Tom
Perkins
1).
Deep
Flight
1
3).
Deep
Flight
Aviator
4).
Deep
Flight
Challenger
5).
Deep
Flight
Super
Falcon
.:
Six
GeneraHons
of
Winged
Submersible
Flight
6).
Deep
Flight
Merlin
2010
–
First
unit
built
for
Richard
Branson
2).
Wet
Flight
1998
–
Scuba
sub
prototype
Prototypes:
Commercial
Offerings:
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

4. Scuba
Diving
4
.:
In
the
Cross-­‐hairs
of
Two
Large
and
Growing
Industries
Luxury
&
ExperienHal
Travel
Big:
•
60+
million
new
divers
WW
since
2000
•
HOS
es@mates
there
are
35M
hardcore
divers
•
HOS
model
assumes
capturing
only
1.5%
•
Approx
spend
$4K
per
capita,
per
year
Growing:
•
In
2009
China
had
1M+
new
Explorer
Divers
•
CAGR
es@mated
at
6%
Global:
•
Avg
8.5M
Explorer
Divers
P.A
•
5.8M
new
cer@fied
Open
Water
divers
per
year
•
800K
cer@fied
dive
instructors
worldwide
•
WW
Dive
&
Snorkel
travel
business
$3
bn
Established
Channel:
•
33K
Dive
stores
&
tour
opera@ons
worldwide
•
Est.
8K
dive
focused
hotels/resorts
worldwide
•
Luxury
travel
represents
3%
of
total
travelers
and
20%
of
the
global
GDP
•
Avg.
Spend
per
trip
is
$10-­‐20K
•
‘Experien@al’
Travel
is
a
$40
bn
market
•
Luxury
&
Experien@al
fastest
growers
• GDP
$5,751
bn
in
2010
worldwide
•
$1,
241
bn
capital
investments
WW
•
Projected
CAGR
over
>
10
yrs
is
4.4%
•
236M
people
employed
worldwide
Sources:
PADI
and
DEMA
Sources:
Cap
Gemini,
wEc.org
&
Mintel
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

5. .:
MulHple
‘Tiers
of
Experience’
Within
the
HOS
Business
Model
Year
6
ProjecHons:
Tourists
Merlin
Rides
*547,000
increasing
increasing
Price
$USD
Experience
Submersible
Pilot
Training
Pre-­‐Owned
Fleet
Sales
New
Submersible
Sales
Dive
Operators
Adventurers
Experience
Value
Underwater
Enthusiast
Totals
600
22
44
Category
Offering
• 547,000
Merlin
rides
represents
approx
1.55%
of
the
worldwide
diver
base
(es@mated
at
35M).
This
amount
does
not
factor
future
non
diver
interest.
5
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

6. .:
Business
Approach
/
Overview
6
Private
Submersible
Sales
HQ
Owned
&
Operated
Ocean
Experience
Center
and
Flight
School
Franchised
Ocean
Experience
Centers
HOS
has
its
origins
in
the
sales
of
high-­‐performance
manned
submersibles
to
high
net
worth
individuals,
and
it
is
both
a
current
part
of
our
business
and
a
key
part
of
our
long-­‐term
growth
strategy.
The
ocean
experience
centers
and
the
successive
orders
of
engagement
they
offer,
including
flight
school,
are
designed
to
funnel
those
individuals
capable
of
private
submersible
ownership
towards
an
ul@mate
purchase
of
such
craF.
We
also
intend
to
deploy
our
franchise
fleet,
aFer
3
years
of
opera@on,
for
sale
to
dive
operators,
who
can
use
those
craF
to
supplement
their
exis@ng
business
on
dive
tours.
High-­‐margin
and
with
favorable
cash
flow
through
pre-­‐payments,
the
private
submersible
business
will
be
a
key
component
of
HOS
value
crea@on.
KEY
POINTS
Yacht
Market
AssumpHons:
•
Sales
Est.
2%
of
the
WW
Yacht
market
base
of
6000
(super/mega)
•
Yacht
Market
CAGR
10%
•
120
sales
per
annum
opportunity
•
30%
market
share
=
36
sales
P.A.
HOS
will
mul@ply
its
rate
of
revenue
growth
and
lower
its
end-­‐user
marke@ng
costs
through
the
development
and
deployment
of
franchise
opera@ons
at
leading
resorts
areas
and
on
cruise
ships,
to
complement
and
supplement
our
wholly-­‐owned
opera@ons.
Franchisees
will
lease
Merlin
submersibles
and
related
accessories
from
HOS,
and
pay
for
marke@ng
and
the
pilots,
which
are
trained
and
cer@fied
by
HOS.
The
franchisee
provides
the
loca@on
and
is
responsible
for
marke@ng
the
experiences
in
their
local
market.
HOS
receives
30%
of
the
overall
top-­‐line
revenues
from
@cket
sales,
plus
addi@onal
fees
for
marke@ng,
training,
and
fleet
usage.
Over
@me,
HOS
expects
to
be
able
to
command
ini@al
exclusivity
payments
from
franchisees
for
key
opera@ng
regions.
.
Hawkes
Ocean
Sports
will
establish
wholly-­‐owned
ocean
experience
center
in
a
leading
tourism
area
with
a
strong
dive
component.
Ini@al
sites
under
considera@on
include
Florida,
Catalina
Island
and
the
Caribbean.
This
center
is
a
cri@cal
component
for
building
all
aspects
of
our
business,
from
the
offering
of
tourism
experiences
to
flight
school
and
pilot
training.
This
will
serve
as
a
model
and
market
center
for
new
poten@al
franchisees
and
as
a
showroom
for
our
fleet
and
private
submersible
sales.
This
center
will
also
be
used
as
the
site
for
training
all
HOS
staff
deployed
as
pilots
for
our
franchise
partners,
and
will,
ul@mately,
be
the
center
of
cer@fica@on
as
we
establish
the
submersible
equivalent
of
PADI/NAUI.
DesHnaHon
Resort
AssumpHons:
•
There
are
numerous
underwater
hotels
in
development
or
shortly
being
launching
in:
Dubai,
Istanbul,
Fiji,
Florida,
Bora
Bora,
USA
and
Australia.
•
We
es@mate
that
there
are
over
15,000
luxury
–
ocean
based
–
des@na@on
Resorts
worldwide.
• HOS
Resort
footprint
represents
approx
0.27%
of
the
total
market
opportunity
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

7. .:
Business
Approach
/
Overview,
ConHnued
7
Franchise
Cruise
Ships
&
Marine
Parks
World
Wide
Owned
&
Operated
Experience
Centers
Used
Fleet
Sales
&
Dive
Operators
Two
other
viable
markets
come
in
the
form
of
luxury
cruise
and
marine
parks.
The
HOS
approach
mirrors
the
one
described
on
the
previous
slide
covering
the
Franchise
Experience
Centers.
Our
scaling
towards
the
cruise
industry
is
very
conserva@vely
modeled
at
10
ships
total
by
Yr5.
With
Marine
Parks
we
are
very
ac@vely
exploring
deployment,
with
several
leading
en@@es
within
the
marine
tourism
sector
at
the
Great
Barrier
reef
in
Australia.
The
owned
&
operated
business
line
is
tac@cally
and
strategically
necessary
for
our
business.
Tac1cal
Business
Reasoning
–
Provides
a
territory
driven
base
of
opera@ons
to
deploy
from.
Enabling
quicker
response
and
be4er
customer
care
while
driving
a
focused
environment
to
drive
services,
sales,
establish
territory
brand
and
drive
local
revenue.
Strategic
Business
Reasoning
–
Upon
sale
of
the
Franchise
business
unit
in
Yr5,
HOS
will
have
established
key
footholds
-­‐
around
the
world
-­‐
from
which
to
drive
private
market
sales
and
services
business
and
allows
local
training
for
future
operators
u@lizing
HOS
craF.
By
Yr3,
it
is
an@cipated
that
a
new
genera@on
of
submersible
craF
will
be
ready
for
deployment.
This
will
subsequently
create
a
need
for
a
used
fleet
sales
strategy.
With
this,
HOS
predicts
a
sizable
demand
coming
from
the
Scuba
Dive
Tour
industry
with
operators
seeking
to
add
the
Merlin
within
their
experience
offering.
We
envision
this
triggering
other
valuable
components
to
our
business
model
KEY
POINTS
Used
fleet
&
Dive
AssumpHons:
•
Secondary
revenue
source
•
Opens
a
lower
price
structure
for
personal
ownership.
Part
of
ramp
up
strategy
to
Yr6,
model.
•
Becomes
a
guerilla
marke@ng
resource
by
targe@ng
a
wider
audience
and
thus
demand.
•
Boosts
training
demand
.
•
Further
establishes
HOS
as
the
defacto
winged
flight
cer@fica@on
authority
O&O
AssumpHons:
•
HOS
Projec@ng
1
new
loca@on
established
per
annum
•
Capped
at
5
loca@ons
•
Key
sales
and
territory
center
•
Will
enable
market
dominance
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

8. .:
HOS
Business
Vision
and
Approach
Timeline
Private
Ownership
Sub
Sales
Franchise
Resorts
&
Hotels
Franchise
Cruise
Ships
&
Marine
Parks
Flight
School
&
Flagship
O&O
O&O
5
loca@ons
worldwide
Used
Fleet
sub
sales
of
genera@on
1
craF
to
dive
operators
Year
6.
Onwards
A
B
Tom
Perkin
Venture
Capitalist
Super
Falcon
Steve
Fosset
Adventurer
Challenger
Sub
Merlin
Private
Ownership
Submersible
Sales
Franchise
Business
Line
-­‐
Resorts
&
Hotels
Franchise
Business
Line
-­‐
Cruise
Ships
&
Marine
Parks
Flight
School
&
First
Owned
&
Operated
Tour
Facility
Public
Company
C
HOS
Launch
Owned
and
Operated
Loca@ons
(
5
planned)
PO
SS
Private
Ownership
Submersible
Market
Used
Fleet
Sales
(Gen
1)
Business
Lines
-­‐
Deployment
Phasing:
Cash
Out
Windows:
Sale
of
Established
Franchise
Business
Planned
(op@onal)
stock
buy
back
Public
Offering
B
C
A
Cer@fica@on
Authority
Timing
TBD
Global
Footprint
Base
8
Contact:
joseph@hawkesoceansports.com
Investment
principals
only
Planned
dividends
distribu@on
to
investors

9. .:
Merlin
Scuba
Submersible
–
Safety
is
our
#1
Priority
Crah
Safety
Environmental
Safety
•
Posi@ve
Buoyancy
•
Prevents
reef
&
underwater
collisions
•
Ba4ery
Power
System
•
Zero
fuel
pollu@on
•
Low
noise
emissions
•
Zero
marine
life
ecosystem
impact
•
Posi@ve
Buoyancy
•
in
power
failure
craF
glides
to
surface
•
State-­‐of-­‐the-­‐Art
Safety
Control
System
•
Computer
Controlled
Ascent/Descent
•
Pilots
trained
to
high
level
of
safety
standards
•
Pilots
follow
PADI
scuba
procedures
•
Specialized
training
on
craF
handling
•
Oxygen
tanks
(80
Cu
Ft)
housed
inside
cockpit
•
Passengers
not
confined
by
equipment
9
Safety
by
Design
Christened
the
Necker
Nymph,
as
the
first
was
successfully
deployed
Merlin,
at
Necker
Island
-­‐
March,
2010.
Contact:
joseph@hawkesoceansports.com
Investment
principals
only
Sir Richard Branson at Necker Nymph unveiling

10. .:
Franchise
ImplementaHon,
Overview
LAUNCH
Business
Appraisal
Agreement
Executed.
Site
Viability
Study.
Proposal
Generated.
120
Days
LOCATION
STRATEGY
PRE-­‐LAUNCH
ONSITE
DELIVERY
Solu@on
Development
Service
Planning
CraF
Build
Begin.
Program
Mgr
Assigned.
Resort
Program
Ini@ated.
Experience
Program
Dev.
Mktg
Program
Dev.
Mktg
Ini@ated.
Onsite
Build.
Pilot/Divers
Onsite.
CraF
Delivered.
Onsite
Training.
Local
Media
Push.
Experience
Tours
Ini@ated.
10
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

11. An Attractive Business &
Investment Opportunity
Competitive conduct:
• All
compe@tors
restricted
by
old
technology
• Winged
flight
IP
gives
HOS
significant
edge
• Few
compe@tors
looking
at
global
offering
• Innova@on
difficult
and
requires
knowledge
• HOS
craF
represent
6
genera@ons
over
20
years
External factors:
• Strong
diving
and
adventure
tourism
base
• Consumer
becoming
more
sophis@cated
thus
tradi@onal
adventure
tours
no
longer
fulfilling
• High
end
resorts
and
cruise
ship
industry
looking
for
new
ways
to
promote
their
unique
value
Industry
structure
and
economics:
• Small
number
of
real
compe@tors
• Industry
opportunity
very
profitable
• Market
poten@al
growing
rapidly
worldwide
• Tradi@onal
pleasure
craF
industry
slow
movers
• Many
of
which
are
restricted
to
territory
Consumer
demand:
• Consumers
seeking
new
&
s@mula@ng
experiences
• Demand
consistently
growing
• Demand
not
being
met
byexis@ng
operators
• Demand
is
a
global
realiza@on
–
Timing
is
now!
.:
Submersible
Tourism
Market:
Forces
at
Work
11
Contact:
joseph@hawkesoceansports.com
Investment
principals
only
=

12. Emerging/Receding
Player
High
High
Low
Low
Challenger
Contender
Market
Leader
Niche
Player
Market
PenetraHon
Quality
of
Experience
Hawkes
Ocean
Sports
Atlan@s
Submarines
Deep
Ocean
Expedi@on
Sub
Aviator
Systems
Stanley
Submarines
.:
CompeHHve
Landscape,
2010
12
UboatWorx
Scuba
CraF
SEAmagine
Nemo
-­‐
100
Kemp
Marine
DMS
US
Submarines
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

13. Risks
MiHgate
Precau@ons
.:
Risks
and
PrecauHons
Slow
ini@al
growth
Strong
compe@@ve
response
from
known
global
brand
Exis@ng
sub
compe@tors
mimic
business
model
Customer
and/or
consumer
apprehension
of
tour
safety
Accident
or
injury
early
on
in
business
rollout
•
Drive
HOS
name
and
brand
•
Leverage
customer
success
•
Focus
on
innova@on
via
R&D
•
U@lize
mgmt
team
know
how
•
Clear
and
targeted
marke@ng
•
Leverage
O&O
as
sales
plaIorm
•
Technology
patents
filed
•
Winged
flight
IP
proprietary
•
Excel
in
safety
and
pilot
training
•
Partner
with
dive
body
leader
•
Drive
safety
mgmt
prac@ce
•
Market
safety
approach
&
record
•
Have
dive
body
conduct
inquiry
•
Focus
on
safety
prac@ce/procedures
•
Act
quickly
to
inquiry
results
with
PR
13
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

14. .:
CompeHHve
Response
Strategy
Compe@tor
‘X’
Scenario
Hawkes
Ocean
Sports
Result
Defendable
Business
Enforce
patent
protec@on
strategy
of
proprietary
technology
A4empts
to
copy
submersibles
and
business
model
Known
pleasure
craF
brand
enters
field
leveraging
name
and
reach
Build
and
market
experience
brand
leveraging
pilot
training
&
craF
safety
Greater
awareness
generated
with
an
increase
in
demand
Extensive
experience
building
and
managing
franchise
business
Highly
experienced
management
team
&
talent
acquisi@on
strategy
No
advantage
Delays
market
entry
and
increases
costs
Deploys
partner
and/or
acquisi@on
strategy
to
strengthen
key
offering
20yrs
of
design
innova@on
in
winged
submersible
IP
with
on
going
R&D
HOS
leverages
unique
submersible
craF
&
patented
technology
Contact:
joseph@hawkesoceansports.com
Investment
principals
only
14

15. .:
Hawkes
Ocean
Sports:
Financials
15
Contact:
joseph@hawkesoceansports.com
Investment
principals
only
All
numbers
in
$000s

16. .:
Hawkes
Ocean
Sports:
Investment
Investment
Requirements:
Q4
2010:
$1.5MM
Angel
Round.
Conver@ble
into
Series
A
with
20%
discount
Q3
2011:
$10MM
Series
A
Use
of
Funds:
Angel
Round:
Establish
O&O
in
USA
and
Great
Barrier
Reef
Build
of
x2
addi@onal
Merlin
submersibles
Build
pilot/diver
training
school
at
USA
based
O&O
Market
franchise
opportunity
Recruit
key
management
team
Series
A:
Secure
human
capital
(sales/mktg,
opera@ons
&
pilot/divers)
Develop
core
fleet
of
submersibles
for
deployment
Ramp
up
targeted
sales
&
marke@ng
Build
dedicated
R&D
team
Establish
worldwide
HQ
16
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

17. .:
Management
Team
17
Joseph
Oliver
President
&
CEO
Graham
Hawkes
CTO
*Michael
Hamill
CFO
Patrick
Corr
GM
O&O
and
Training
•
Start-­‐up
CEO
&
Co
Founder,
DIDMO
AB
–
award
winning
mobile
developer
•
VP
Digital
Services,
Ascent
Media
Group
-­‐
Liberty
Media
•
VP
Marke@ng
&
Bus
Dev,
Proximity
Group
-­‐
Acquired
by
Apple
•
Director
of
Product
&
Market
Dev,
Loudeye
Technology
-­‐
Acquired
by
Nokia
•
Marine
Engineer
&
Ships
Diver,
Royal
Navy
•
Inventor
of
300+
manned
submersibles,
including
Wasp,
DeepRover,
Deepflight
•
Founder,
Precision
Remotes
(weapons
plaIorm
systems
used
by
US
Army)
•
Founder,
Hawkes
Ocean
Technologies
(currently
working
with
DARPA
&
US
Navy)
•
Recipient
of
the
Discovery,
Rolex,
Smithsonian
&
Explorers
Club
Awards
•
Full
Bio
can
be
found
on
website
–
h4p://www.hawkesoceansports.com
•
Managing
Director,
Grand
View
NaHonal
Investment
Bank
•
Vice
Chair,
Execu@ve
Commi4ee,
Culver
City
Chamber
of
Commerce
•
Senior
Vice
President,
Worldwide
Finance,iXL
•
Audit
Staff,
Arthur
Andersen
•
Senior
Vice
President,
Training
&
Safety,
Bristow
Group,
Inc.
•
Founder
and
CEO
–
Helicopter
Adventures
Inc.
(Acquired
by
Bristow
Group)
•
Commissioned
Officer
–
Irish
Army
•
Chairman,
numerous
Avia@on
Bodies
incl,
Helicopter
AssociaHon
InternaHonal
Contact:
joseph@hawkesoceansports.com
Investment
principals
only
*
Joining
company
upon
comple@on
of
Conver@ble
Note
Financing

18. .:
Board
of
Directors
&BoardAdvisors
18
Jonathan
Epstein
Chairman
of
the
Board
•
President
and
CEO,
Hawkes
Remotes,
Inc
•
CEO,
Double
Fusion
•
Agent,
United
Talent
Agency
•
EVP
&
General
Manager,
Media
Division,
IGN/GameSpy
Dennis
Phillips
Board
Director
•
COO,
Found
Animals
FoundaHon
•
CFO,
Media
Services,
Ascent
Media
Group
•
EVP,
Worldwide
Finance,
iXL
•
Divisional
CFO,
Walt
Disney
Mukul
Krishna
Board
Advisor
•
Global
Director,
Frost
&
Sullivan
•
Program
Manager,
&
Industry
Analyst
Frost
&
Sullivan
•
MBA,
Thunderbird
Contact:
joseph@hawkesoceansports.com
Investment
principals
only
Other
Board
Directors
Board
Advisors
•
Graham
Hawkes
•
Karen
Hawkes
•
Joseph
Oliver
•
Michael
Kleeman
Chair
of
the
American
Red
Cross
Board
Director
–
Marine
Mammals
Center
Senior
Fellow,
UCSD
,
IGGC

19. .:
Press
Coverage
19
.:
Recent
press
&
media
coverage
on
Deep
Flight
crah
Hawkes
Submersibles
have
generated
popular
akenHon
via
some
of
the
worlds
most
recognized
media
outlets
Contact:
joseph@hawkesoceansports.com
Investment
principals
only

20. Contact
Joseph
Oliver
President
&
CEO
Hawkes
Ocean
Sports,
Inc.
h4p://www.hawkesoceansports.com
joseph@hawkesoceansports.com
+1
650
520
2959