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| Introduction Netwire empowers its members (individuals who open Netwire accounts) with the ability to instantaneously transfer money worldwide. A Netwire account acts as an e-wallet, which will then permit members to load, withdraw and transfer funds seamlessly and instantly. Through agreements we've set up with banks around the world, members have the ability to transfer funds to any other Netwire member anywhere in the world, eliminating inconvenient delays currently presented by agents such as Western Union, Money Gram and Vigo, among others. All transactions for members within the Netwire network are free of charge for the sender and recipient, a major competitive advantage over firms such as Paypal and Western Union which impose costly fees on the transaction. Revenue Model The majority of revenue for Netwire is interest (float) collected on member's accounts. Member accounts are similar to checking accounts provided by banks in that our members will not realize any of the interest payments to their accounts; instead, this interest will be realized as Netwire revenue. Revenue is also generated through transfers involving the exchange of currency. By setting foreign exchange rates slightly below those set by the marketplace, we generate extra revenue on every transfer involving currency exchange. An additional source of revenue is generated from member withdrawals involving the use of an ATM. These ATM fees are shared with the owners of the ATM network. While small, the fees encourage the use of the ATM's and therefore build a significant amount of revenue for Netwire over time. Rather than pay traditional ATM fees of $2 or more Netwire users can pay fees as low as .25 cents. Finally, but not inclusively, we generate revenue through strategic alliances with firms possessing certain characteristics. These alliances build revenue by attracting customers, while also building revenue through the sale of information regarding member spending to the allied firm. An example of such alliances might be offering Dell coupons for Dell customers who processed their order through Netwire, or Blockbuster gift cards which enable movies to be sent as a gift, all processed exclusively using the Netwire network. Bestbuy for example can bundle discounts with products which encourage value minded shoppers to buy the latest cell phone and pay for it using Netwire for cell phone service! Further information regarding transfer frequency, origin and destination pairs, and global interest rates, among other things, are calculated in order to capture monthly, quarterly and yearly projected revenue. Growth and Competitive Advantage Netwire is expecting substantial growth in the future. This growth is based on the uniqueness of the service, technological efficiencies, and strategic alliances. How would you like to be one click away from instantly transferring funds to someone anywhere in the world? With Netwire, this is possible. Currently, it takes brick and mortar establishments considerable amounts of time to process and post transfers to recipient's accounts. Through our service, members are able to safely and instantly transfer funds anywhere in the world, without fees of any sort. Herein lies our competitive advantage, and innately we are capturing market share from the current brick and mortar establishments and from other online money transfer companies, while revolutionizing the way people transfer money. Netwire eliminates the fees associated with firms such as Paypal and Western Union, significantly lowering costs for the transactions to its members. By eliminating both flat fees and percentage fees per transaction, Netwire is able to significantly undercut its competitors, offering retail customers a way to slash costs and offering individuals the ability to transfer money online as cheaply, and far more conveniently, than they can offline. In addition, strategic alliances with firms who fit the mold laid out in our business plan are being pursued in an attempt to grow the member base. These strategic alliances will also include firms who are household names and that have a vast number of locations, allowing us to capitalize on their distribution network, while keeping our costs low. Moreover, at this stage we will be able to capitalize on business opportunities and avoid the bureaucracy involved in the everyday business of large corporations. By operating as a closely held firm, decision-making is less cumbersome; as a result the firm operates efficiently and without the complications brought upon by the bureaucracy of big business. The technological edge brought upon by the way we do business also carries over into the streamlining of business decisions, further adding to the competitive advantage of Netwire. Disruptive Technology By leveraging and then integrating existing Internet based and financial based technological infrastructure using proprietary software, Netwire is able to disintermediate many of the existing shortsighted players. It's easy to imagine Netwire quickly aggregating 100 million customers through partnerships, then with that consumer base providing our retail customers the opportunity to reduce or eliminate fees associated with online payments such as credit cards or Paypal by using Netwire. Because Netwire is a PIN based system we can not only disintermediate Visa and MasterCard, making them obsolete, but also we may drastically reduce or even potentially eliminate retail credit card fraud. The Need for Additional Capital Netwire is in its early stages, meaning that additional capital would enable us to take full advantage of our current business opportunities, and to expand on our current infrastructure that will allow us to properly manage our growth. Exit Strategies Within the next 12-24 months Netwire should have the opportunity to go public if it chooses. Once the firm is well established and the timing is correct, Netwire will have that flexibility. Contrary to many other firms that attempt to become acquisition targets, we on the other hand plan on purchasing other companies in the hope that the synergy created from the purchases is able to further compliment the operations of Netwire. There are a number of small targets that both enable additional Netwire network function and aggregate customers. In 2004, First Data Corporation (owner of Western Union) spent $7,530.9M in acquisitions, and while we do not anticipate spending this amount on purchases early on, we still feel that an acquisition strategy is viable possibility that could be facilitated by an IPO. |