1. Sizing Up the Numbers Market Size Business Size Market Share Revenue Projections

2. Market Size? US Department of State US Department of State Ed.gov Ed.gov US News & World Report US News & World Report (Ed.gov recommended) Petersons.com- (Ed.gov recommended) Petersons.com- 4,212 Total Undergraduate Colleges & Universities 4,212 Total Undergraduate Colleges & Universities 2,986 Business 2,986 Business 2,058 Education 2,058 Education

3. Market Size National Center for Educational Statistics National Center for Educational Statistics Study: (US) Degree Granting Programs & Branches… Study: (US) Degree Granting Programs & Branches… (2002 – 03) (2002 – 03) CategoryTotalPublicPrivate All4,1681,7122,456 2-Year1,8441,101743 4-Year2,3246111,713 Masters646283363 Doctorate-any26116695

4. Market Size Institution-Based Pricing Test: Institution-Based Pricing Test:

5. Market Size Areas of study? Areas of study? US News & World Report – US News & World Report – Americas Best Graduate Schools 2005:

6. Market Size Subtract Medicine, Law, Health Sciences Subtract Medicine, Law, Health Sciences

7. Market Size Number of departments per field of study? Number of departments per field of study?

8. Market Size Number of departments per field of study Number of departments per field of study

9. Market Size Number of Masters-Level Departments: Number of Masters-Level Departments: Note – Not all institution has every department.

10. Business Size? Some brief thoughts… Some brief thoughts… InBusiness Magazine InBusiness Magazine Profiles of new business startups in the Madison area Profiles of new business startups in the Madison area PlanNet, LLC, profiled this month: PlanNet, LLC, profiled this month: $200,000 annual income = 1 employee, plus some consulting $ $500,000 annual income = 2-3 employees Includes considerations for employee benefits, office space, overhead, etc… Smith, Jenifer & Weig, Jen (2004, November). Start Ups. InBusiness, 46- 47.

11. Business Size? A Madison area high tech business: A Madison area high tech business: $6,000,000 Annual Revenue ~ 35 employees $6,000,000 Annual Revenue ~ 35 employees $10,000,000 Annual Revenue – 60 employees $10,000,000 Annual Revenue – 60 employees $20,000,000 Annual Revenue – 130+ employees $20,000,000 Annual Revenue – 130+ employeesRevenue/employee: $6,000,000 / 35 = $170k / employee $10,000,000 / 60 = $165k / employee $20,000,000 / 130 = $155k / employee

12. Business Size 1 employee = about $ 175k in annual revenue required. 1 employee = about $ 175k in annual revenue required.

13. Business Size Subscriptions required to generate revenue Subscriptions required to generate revenue

14. Business Size Subscriptions per employee Subscriptions per employee

15. Market Share Market Size = 18, 550 Masters Level Departments Market Size = 18, 550 Masters Level Departments Market penetration required per employee: Market penetration required per employee:

16. Growth Guestimates How fast can this idea grow? How fast can this idea grow?

17. Time to $ One 1 st 6 Months 1 st 6 Months Work out technical aspects. Work out technical aspects. Begin obtaining journal info from 1-2 specific fields. Begin obtaining journal info from 1-2 specific fields. 2 nd 6 Months 2 nd 6 Months Begin membership recruitment (no fees) Begin membership recruitment (no fees) Start expanding fields in database to 1-2 areas of study. Start expanding fields in database to 1-2 areas of study.

18. Time to $ One 2 nd year 2 nd year Expand memberships – gain market share/acceptance Expand memberships – gain market share/acceptance Make the 1-2 fields of study an exhaustive list Make the 1-2 fields of study an exhaustive list Begin expanding database into more areas of study Begin expanding database into more areas of study 3 rd year 3 rd year Market base established, move to to paid subscriptions. Market base established, move to to paid subscriptions.

19. Year 3 Journal database for 2 areas of study Journal database for 2 areas of study 5,424 Current Market Size @ Start Year 3 5,424 Current Market Size @ Start Year 3 Membership Size Membership Size

20. Year 3 Theoretical Revenues Theoretical Revenues

21. Year 3 Transition to paid membership losses @ $50/yr Transition to paid membership losses @ $50/yr Transition to paid membership losses @ $100/yr Transition to paid membership losses @ $100/yr

22. Simplify To simplify calculations: To simplify calculations: Assume acceptance rate of 15% per year. Assume acceptance rate of 15% per year. Assume membership fee must be at least $50 per year, and not more than $100. Assume membership fee must be at least $50 per year, and not more than $100. Year 3 revenues, simplified: Year 3 revenues, simplified:

23. Market Size Growth Projections Year 3 Market Served Size = 5,424 Year 3 Market Served Size = 5,424 Estimated Total Market Size = 18,550 Estimated Total Market Size = 18,550 Market Expansion Growth Rate: Market Expansion Growth Rate: Assume 10% growth per year of percent of total market served. Assume 10% growth per year of percent of total market served.

24. Growth Projections Assume 50% loss when changing over to paid subscriptions Assume 50% loss when changing over to paid subscriptions (Market Size = 18,550) Assume 10% growth per year of in percent of total market size served. (Market Size = 18,550) Assume 10% growth per year of in percent of total market size served. Assume 15% market share growth per year. Assume 15% market share growth per year.

25. Revenue Projections Revenue Projections- Finally! Revenue Projections- Finally!

26. Revenue Projections Number of employees supportable @ $175k annual revenue per employee Number of employees supportable @ $175k annual revenue per employee Thus, assume $100 per year membership fee. Thus, assume $100 per year membership fee.

27. Revenue Projections Final Numbers Final Numbers

28. Notes Someone needs to run the business for more than 2 years to get it up and running. Someone needs to run the business for more than 2 years to get it up and running. They will expect to be paid in the future for such efforts. They will expect to be paid in the future for such efforts. Perhaps delay hiring employees in years 4+ to help provide a return on time invested? Perhaps delay hiring employees in years 4+ to help provide a return on time invested? Year 5 estimated revenues = $486,938. Year 5 estimated revenues = $486,938.

29. Sizing Up the Numbers Conclusion Market Size Market Size Business Size Business Size Market Share Market Share Revenue Projections Revenue Projections