Third Degree I.D. is an LLC with three partners in Savannah, Georgia. They design, develop, and market instructional products and services for the corporate, education, government, and healthcare e-learning industries. Their focus is on high-quality instructional design and new media development, delivering programs and courses for distance education and e-learning markets.

The company uses an object-oriented design methodology to create flexible and scalable content. They aim to have a diverse client portfolio by working with clients from various sectors. They also build long-term relationships with returning customers and repurpose educational content.

Each of the three partners will invest $35,000 into the company, and they are seeking a two-year loan of $30,000 to complete the start-up funding. Around $19,000 of the initial funding will cover start-up expenses and assets. The remaining funds will support operations for the first year, during which Third Degree I.D. will provide at-cost work to influential clients to establish a strong reputation for their capabilities. This reputation will form the basis for marketing and sales strategies in subsequent years.

Their conservative sales goal for the first year is $360,000, based on market research and their combined expertise. Growth estimates for years 2 and 3 are based on data from similar businesses in the industry.

Educational Software Business Plan Example

1.1 Objectives

The key objectives for Third Degree I.D. in the first year are:

  • Establish a legal business through licensing.
  • Complete business planning and pursue funding through venture capital, bank loans, grants, and contracts.
  • Establish a web presence and list products and services in industry-relevant websites and publications.
  • Contract with six to eight clients requiring consulting, training, design, or development work ($50,000 or more).

1.2 Mission

Third Degree I.D. designs, develops, and markets instructional products and services for the corporate, education, government, and healthcare e-learning industries. It provides cost-effective, progressive, flexible, and well-supported solutions to instructional design and e-learning operational needs. Its primary goal is client satisfaction, serving client interests as an ally and loyal business partner. The company operates for profit and offers an engaging work environment for its owners, employees, and contractors.

1.3 Keys to Success

Success will depend on:

  • Persistent and creative client development efforts
  • Exceptional product and service quality
  • Time-efficient and cost-effective development processes
  • Expert management and knowledgeable staff
  • Cash-savvy growth strategies

Company Summary

Third Degree I.D. is located in Savannah, Georgia. It sells instructional design products and services to the corporate, education, government, and healthcare e-learning markets. The company is committed to high-quality instructional design and educational new media development. It sells program/curriculum design and development, course design and development, program/curriculum and course evaluation, content analyses and revision, rich-media production, e-learning training, e-learning consulting, and additional services such as market research, editing, document workflow, and translation. Third Degree I.D. employs an object-oriented design methodology that yields flexible, scalable, and reusable content. This approach provides clients with rich, targeted solutions that are easily replicated and maintained.

2.1 Start-up Summary

To begin the business, we require $5,924 in start-up expenses and another $13,000 in non-cash assets. Details of these requirements can be found below.

Expenses

Legal Expenses

  • Attorney Consultation — $300
  • Initial Filing Fee for LLC — $400
  • Name and Logo Trademark — $300

Website Expenses

  • Website Domain (2 Years) — $14
  • Website Hosting (1 Year) — $96

Communications

  • Stationery/Letterhead + Envelopes (500 set) — $500
  • Business Cards (500 x 3) — $300

Memberships and Subscriptions

  • Coastal Beta — $75
  • eLearning Guild — $95
  • Faculty Finder.com — $745

Software

  • Authoring and Multimedia Software for Sony Vaio — $1,000
  • Authoring and Multimedia Software for Mac Powerbook — $1,000
  • Authoring and Multimedia Software for SH Desktop — $300

Long-term Assets

Computer Hardware

DS Laptop (Sony Vaio) — $2,500

MH Laptop (Mac 15″ Powerbook — $2,500

SH Desktop + Laser Printer + Scanner — $2,000

Networked Content Server — $6,000

Start-up Investment

Each of the founding partners will make an equal investment of $35,000 in starting the business. Additionally, the partners intend to secure a 2-year commercial loan of $30,000 to cover the working capital requirements for the initial period of operations.

All startup expenses and funding requirements are summarized in the tables below.

Educational Software Business Plan Example

Start-up Requirements

Legal: $1,000

Annual State Fees: $300

Insurance: $200

Website domain and hosting: $109

Stationary/Business Cards: $800

Office Supplies: $100

Wireless Home Network (Airport): $200

Memberships/Subscriptions: $915

Software: $2,300

Total Start-up Expenses: $5,924

Start-up Assets

Cash Required: $116,076

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Other Current Assets: $0

Long-term Assets: $13,000

Total Assets: $129,076

Total Requirements: $135,000

Start-up Funding

Start-up Expenses to Fund: $5,924

Start-up Assets to Fund: $129,076

Total Funding Required: $135,000

Assets

Non-cash Assets from Start-up: $13,000

Cash Requirements from Start-up: $116,076

Additional Cash Raised: $0

Cash Balance on Starting Date: $116,076

Total Assets: $129,076

Liabilities and Capital

Liabilities

Current Borrowing: $30,000

Long-term Liabilities: $0

Accounts Payable (Outstanding Bills): $0

Other Current Liabilities (interest-free): $0

Total Liabilities: $30,000

Capital

Planned Investment

S. Hines: $35,000

M. Meyer: $35,000

D. Stanford: $35,000

Additional Investment Requirement: $0

Total Planned Investment: $105,000

Loss at Start-up (Start-up Expenses): ($5,924)

Total Capital: $99,076

Total Capital and Liabilities: $129,076

Total Funding: $135,000

Company Ownership

Third Degree I.D. is structured as a limited-liability company (LLC), consisting of three executive partners: Susan Hines, Mona Meyer, and Daniel Stanford, who will function as the CEO, CLO, and CCO, respectively.

Services

Third Degree I.D. focuses on program/curriculum design and development, course design and development, program/curriculum and course evaluation, content analyses and revision, rich-media production, e-learning training, e-learning consulting, and additional services such as market research, editing, document workflow, and translation. These services are broken down as follows:

Program/Curriculum Design & Development

– New Program Services

– Existing Program Services

Program Design & Development

Third Degree I.D. provides development services for clients based on educational best practices and client specifications. The services align with institutional goals and exceed accreditation and/or compliance standards.

New Program Services

Needs Analysis Report

Clients are charged based on the project scope, typically tied to the length and/or number of programs/curricula. For example, a needs analysis report for an e-learning certificate or academic “minor” would cost $3,600.

Estimated Development Cost:

– Base Charge: $2,400

– 7- to 12-Course Series: $3,000

– 13- to 16-Course Series: $3,600

– 17- to 20-Course Series: $4,200

Funding Assistance

Clients receive assistance in raising funds externally to cover start-up and operation expenses. The initial consulting charge is $75 per hour, with subsequent efforts charged at $50 per hour.

Program/Curriculum Prospectus

The prospectus outlines program/curriculum objectives, viability, development dependencies, implementation constraints, market study, and evaluation plan.

Estimated Development Cost:

– Base Charge: $2,400

– 20% discount for clients purchasing a needs analysis report

Program/Curriculum Development Plan

The development plan covers program/curriculum specifications, curriculum design, course-series or individual course requirements, and project timelines.

Estimated Development Cost:

– Base Charge: $400 to $1,000

– 20% discount for clients purchasing a curriculum prospectus report

Program/Curriculum Implementation Strategy

The strategy report recommends ways to optimize program/curriculum support, enrollment goals, scheduling, instructor recruitment, content-reuse, and technical support strategies.

Estimated Development Cost:

– Base Charge: $500 to $1,250

– 20% discount for clients purchasing a program/curriculum development plan

Program/Curriculum Evaluation Plan

The evaluation plan includes qualitative and quantitative strategies, survey collection instruments for curriculum and course analysis to meet accreditation and/or compliance standards.

Estimated Development Cost:

– Base Charge: $800 to $1,400

– 20% discount for clients purchasing a curriculum prospectus report

Existing Program Services

Program/Curriculum Evaluation Report

The evaluation report analyzes a program/curriculum and provides recommendations for content, structure, and delivery improvements.

Estimated Development Cost:

– Base Charge: $300 to $6,000

– 20% discount for clients purchasing a curriculum evaluation report

Program/Curriculum Strategy Report

The strategy report analyzes the current implementation and operations strategy of a program/curriculum, recommending optimization and leveraging strategies.

Estimated Development Cost:

– Base Charge: $500 to $1,250

– 20% discount for clients purchasing a curriculum evaluation report

Program/Curriculum Maintenance (on Retainer)

Basic maintenance of courses and learning objects in an e-learning program or curriculum is provided at a monthly fee of 5% of the overall program/curricula charge.

Course Design and Development

Third Degree I.D. provides course- or project-development services in accordance with established curriculum plans. The services produce instructionally sound, engaging course work that exceeds institutional accreditation standards.

Estimated Development Cost per Unit:

Base Charge: $400 to $1,200

Learning Object Development

Third Degree I.D. designs and develops rich-media learning objects to enhance course interactivity, simulate real-world scenarios, and provide stimulating alternatives to traditional instruction.

Object Types:

Level 1, Level 2, Level 3

Cost estimates for Development Options and Delivery Options are available upon request.

Additional Development Services and Pricing:

– Course or Program Design Consultation: $1,000

– Needs Analysis and Market Study Development: $1,500 per program

– Course or Program Marketing Plan Development: $250

– Multimedia Localization: $400

– Assessment Development: $150 per assessment

– Image Selection/Enhancement: $300 per 25 images

– Video and Audio Enhancement: $700 to $1,050 per 7 clips

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Third Degree I.D. specializes in e-learning instructional design for the corporate, educational, healthcare, and government sectors. The emphasis is on corporate and educational markets, which are expected to experience the most growth.

The projected Year 1 business is $360,000, with at least three 7- to 12-course series (e.g. professional certificates or master’s degrees). Higher-ed clients will account for 50% of the revenue, corporate clients will contribute 40%, and K-12 clients will make up the remaining 10%.

According to the Booz Allen Hamilton white paper, "Re-Learning E-Learning," the compound annual growth rate for higher ed is 25%, corporate is 30%, and K-12 is 30%. These estimates were used to calculate the new-development revenue for each sector.

Additionally, Third Degree I.D. expects to generate revenue through reuse and relicensure at a rate of 25% of cumulative revenue from year to year.

The e-learning market is expanding globally, with the United States accounting for 37.5% of the $2 trillion training and education market. The corporate sector has the greatest demand for e-learning, with potential savings of "30 to 60 percent" compared to traditional classroom instruction.

Higher education and K-12 are also substantial markets, with a combined industry value of over $100 billion. The increasing number of computer-savvy high school graduates and the need for expanded educational opportunities are driving the demand for e-learning in these sectors.

Although the healthcare and government sectors are adopting e-learning at a slower pace, there is a strong interest in both industries. The healthcare industry has an 80% interest level, with a 30% commitment, while the government sector shows a 50% interest level, with a 39% commitment.

Overall, Third Degree I.D. is well-positioned to meet the growing demand for e-learning in various sectors, leveraging its expertise and comprehensive range of services.

Educational Software Business Plan Example

Market Analysis

Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR

Corporate 30% 144,000 187,200 243,360 316,368 411,278 30.00%

Higher Education 25% 180,000 225,000 281,250 351,563 439,454 25.00%

K-12 Education 30% 36,000 46,800 60,840 79,092 102,820 30.00%

Total 27.57% 360,000 459,000 585,450 747,023 953,552 27.57%

4.2 Target Market Segment Strategy

Third Degree I.D. focuses on the corporate and educational markets as they represent the e-learning growth sectors locally and regionally. Savannah and the Lowcountry experience genuine growth in high-tech businesses and are home to over 20 colleges, universities, technical institutes, and educational centers in higher education alone.

4.3 Service Business Analysis

The educational services industry comprises numerous existing businesses competing in multiple segments. K-12, colleges/universities, and corporate training providers historically utilized instructor-led approaches. However, e-learning has emerged as a cost-saving alternative that allows for increased geographical reach and offers significant development and delivery advantages.

4.3.1 Competition and Buying Patterns

Traditionally, the competition in e-learning has been among large, proprietary CMS/LMS vendors and IT-infrastructure companies. However, the focus has shifted towards the actual content delivered as more affordable and open-source systems emerge. Third Degree I.D. leverages this trend by emphasizing user-centered instructional design and creating object-oriented content that can be easily installed and migrated across different systems. The company also specializes in designing and developing for popular proprietary CMS/LMS systems while maintaining interoperability and compliance standards.

Strategy and Implementation Summary

Third Degree I.D. focuses on four e-learning markets: corporate, educational, healthcare, and government sectors. While expanding its business nationally and internationally, the company prioritizes developing long-term local and regional clients.

Target customers for Third Degree I.D. are upper-level management individuals responsible for day-to-day e-learning operations.

5.1 Competitive Edge

Third Degree I.D. provides personal, customized instructional design services that larger proprietary systems vendors cannot match. The company prioritizes understanding market opportunities, business goals, and user requirements to deliver effective instructional solutions. By asking probing questions and delivering superior solutions, Third Degree I.D. distinguishes itself in instructional design.

5.2 Marketing Strategy

Third Degree I.D.’s first-year marketing strategy focuses on initiating personal contacts, demonstrating excellence in every interaction, and winning key clients through expertise demonstration and limited initial investment. The company aims to make a name for itself.

During the initial year, Third Degree I.D. faces marketing challenges due to being a newly formed partnership without immediate name recognition. However, the custom content development industry lacks major recognition among consumers, even those successful in the market. Third Degree I.D. aims to overcome these challenges by showcasing the cost-effectiveness and superior service of outsourcing content development to a well-equipped development house.

5.3 Sales Strategy

Third Degree I.D. promotes its products and services through its website and targeted advertising in e-learning and distance education portals and publications. The company also utilizes direct mailings to businesses and institutions planning online program rollouts or experiencing accreditation problems related to e-learning.

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5.3.1 Sales Forecast

During the first year of operations, Third Degree I.D. will generate sales from new content and curriculum development. The company plans to make the content reusable and repackage it for future clients, thus reducing overall development costs. Additionally, 25% of cumulative previous years’ sales are expected to come from reused content.

In conclusion, Third Degree I.D. focuses on delivering personalized, high-quality instructional design services and aims to establish long-term relationships with key clients. The company will also position itself as a leader in the industry by offering innovative learning objects and implementing a comprehensive marketing strategy.

Educational Software Business Plan Example

Educational Software Business Plan Example

Sales Forecast:

Sales Forecast
Year 1 Year 2 Year 3
Sales
New Curriculum & Content Development $360,000 $400,000 $480,000
Reuse, Re-licensure and Maintenance $0 $90,000 $190,000
Learning Object Development $0 $20,000 $30,000
Training $0 $20,000 $30,000
Consulting $0 $30,000 $40,000
Other Services $0 $0 $0
Total Sales $360,000 $560,000 $770,000
Direct Cost of Sales Year 1 Year 2 Year 3
Software packaging $18,000 $28,000 $38,500
Other Services $0 $0 $0
Subtotal Direct Cost of Sales $18,000 $28,000 $38,500

5.4 Milestones:

Our milestones for the initial period are summarized below.

Educational Software Business Plan Example

Milestones:

Milestone Start Date End Date Budget Manager Department

Establish LLC 6/1/2004 6/18/2004 $400 CEO Business

Develop Sales Portfolio 6/1/2004 6/30/2004 $0 CEO/CLO/CCO Business/Design

Develop Sales Presentation 6/1/2004 6/30/2004 $0 CEO/CLO/CCO Business/Design

Develop WebCT Template 6/14/2004 6/30/2004 $0 CEO/CLO/CCO Design

Develop Sales Contracts 6/14/2004 7/31/2004 $0 CEO/CLO/CCO Business

Develop WebCT Course(s) 6/14/2004 8/15/2004 $0 CEO Design

Seek Funding: Loans 6/1/2004 8/31/2004 $0 CEO/CLO/CCO Business

Develop Learning Objects 6/15/2004 12/15/2004 $0 CLO/CCO Design

Move to Office Space 1/1/2005 1/15/2005 $1,000 CEO/CLO/CCO Business

Revise Website 2/1/2005 4/1/2005 $0 CEO/CLO/CCO Business

Promote Company 6/15/2004 8/31/2005 $6,000 CEO/CLO/CCO Business/Design

Totals $7,400

Web Plan Summary:

The Third Degree I.D. website will familiarize potential clients with the company’s unique approach to instructional design and e-learning content development. It will establish Third Degree I.D. as an experienced instructional design group with over 25 years of collective experience.

6.1 Website Marketing Strategy:

The website will showcase Third Degree I.D.’s instructional design through learning object samples and case studies. It will demonstrate how the company can create engaging and effective learning experiences. The website will also provide supplementary information for existing clients through a client extranet.

Internationally-known educational media organizations and online ads will drive traffic to the Third Degree I.D. website, improving visibility and generating interest.

6.2 Development Requirements:

The Chief Creative Officer will be responsible for developing the Third Degree I.D. website, including domain registration, web hosting, site design, and database integration for the client extranet.

Management Summary:

Third Degree I.D. is a small company with a lateral structure. It will operate with three full-time founders in the first year and hire contractors as needed. As the business grows, additional staff will be added.

7.1 Personnel Plan:

Third Degree I.D. will be owned and operated by three executive partners: CEO, CLO, and CCO. The CEO will focus on consulting and project management, while the CLO and CCO will handle product development. The partners will work together to promote the business and manage office operations.

Future staffing plans include hiring a Technology Director to work with the CLO and CCO on database-driven learning objects and e-learning solutions. In the first year, outside consultants will provide support as needed. Additional development staff may be added as the client base grows.

Personnel Plan:

Year 1 Year 2 Year 3

Susan Hines $75,000 $75,000 $75,000

Mona Meyer $75,000 $75,000 $75,000

Danny Stanford$75,000 $75,000 $75,000

Inst. Designer $0 $0 $50,000

Prod. Assistant$0 $0 $30,000

Tech Director $0 $75,000 $75,000

Total People 3 4 6

Total Payroll $225,000 $300,000 $380,000

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