is a revolutionary concept that will provide a Web-based trading platform for Chinese equities and securities investors and institutions. will change the way people invest in China by offering real-time stock price quotes, analysis, expert commentary, investment forums, online bank transfers, and educational material. The platform’s configurable interface allows users to optimize their experience and investing profile.

With the development of the Chinese national superhighway project and China’s imminent membership into the World Trade Organization (WTO), Internet use and investing will grow rapidly. There were 4.5 million Internet users in China as of June 1999, and this number is expected to increase to 20 million by the end of 2000. It is anticipated that as foreign equities markets become available to individual investors, trading volume will increase. has anticipated this trend and will be the first to support international trading.

The U.S. market for equity securities has also grown dramatically in recent years. The increase in daily trading volume on NASDAQ is a result of historic market highs and the growing number of listed issuers. More investors are trading online due to advancing technology. These trends are expected to develop in China, and aims to take advantage of the significant market opportunity for faster, easier, more reliable, and less expensive trading systems. is based in Shanghai, China, with an office in Sunnyvale, CA. Initial seed capital and technical support have been provided by Starmile Systems Engineering, Co. LTD. The goal of setting up as a U.S.-based company is twofold: to facilitate access to the U.S. equities markets and to quickly go public in the U.S. First and second round funding will be required to develop and market this trading platform, with the possibility of additional funding in Q4, Year 3.

Investment Website Business Plan Example

1.1 Objectives:

– Alpha and Beta testing of Web-based platform, January 15th and May 15th, Year 1, respectively, with strategic partners in China.

– Complete negotiations with two large brokerage firms for initial deployment of trading platform by June 1st, Year 1.

– Secure first round funding by June, Year 1.

– available for individual investors beginning June 1st, Year 1 (without online trading).

– available for online trading starting September 15th, Year 1.

– U.S. equities markets available in China via in Q2 Year 2.

– Achieve revenues of $300,000 by year-end, Year 1.

– Sign up 18,000 members and 14 brokerages by Q4 Year 1.

– Deploy as a trading platform in the U.S. by Q3 Year 3.

– to become a U.S. public company by Q4 Year 3.

* anticipated WTO membership in Q4 Year 1.

1.2 Mission:’s mission is to provide investors with the most comprehensive Web-based trading platform available. We will continuously evolve the trading platform based on user feedback and enhance the product mix to meet their needs. We are committed to delivering an exceptional customer experience that builds trust and confidence. Our goals are to maintain a first-class image, provide first-class quality and service, and generate a fair profit for employees and investors. We value our employees and will reward their contributions as milestones are achieved and the company grows.

1.3 Keys to Success:

To succeed in this business, we must:

– Differentiate’s Web-based trading platform by increasing functionality and features desired by advanced Internet traders.

– Ensure 100% customer satisfaction with order transmission and customer service to encourage repeat usage.

– Achieve 100% brokerage satisfaction with’s online trading implementation and cost-effectiveness.

– Leverage Starmile’s technical expertise and client base to promote’s equities trading platform and its advantages.

1.4 Strategic Advantage: will have a competitive advantage over other Web-based trading platform providers due to the following reasons:

– Starmile has extensive technological knowledge in bank information processing, including transaction processing, account inquiries, and settlements.

– Starmile has developed a certified payment cryptography system, recognized by the National Cryptography Administration Committee and ISO9002.

– Starmile has created an online non-Web-based security trading system for China JiangQian Tide, which includes most of the functionality proposed for the trading platform.

– has an experienced and diverse management team and Board of Directors with backgrounds in technology, banking, and securities industries.

– Being a U.S. company with a solid relationship with Starmile provides a lower barrier to achieving market penetration in China, as cultural preferences make it difficult for American companies to obtain market share.

Company Summary: is a new company that will provide a Web-based Internet trading platform for Chinese investors. It has been formed in anticipation of the rapid growth in Internet trading due to recent government programs and China’s upcoming WTO membership. will offer investors features and investing sophistication that are currently unavailable with existing trading platforms in China.

2.1 Company Ownership: will be created as a Cayman Islands Corporation to take advantage of its tax-free status. Initially, ownership will be divided between Starmile System Engineering, Inc., and its principal officers. No officer will own more than 10% of the company. Additionally, wholly-owned subsidiaries will be established in Hong Kong, Shanghai, and Delaware.

2.2 Start-up Summary:

Starmile System Engineering Inc. provided initial seed capital, which has been used for operating and software development expenses since the company’s inception. The use of proceeds is detailed in the chart and table below.

Investment Website Business Plan Example

Start-up Requirements

Legal: $20,000

Stationery etc.: $2,000

Brochures: $5,000

Consultants: $5,000

Insurance: $2,000

Rent: $25,000

Research and development: $200,000

Expensed equipment: $1,000

Marketing & Advertising: $25,000

Total Start-up Expenses: $285,000

Start-up Assets

Cash Required: $100,000

Other Current Assets: $0

Long-term Assets: $50,000

Total Assets: $150,000

Total Requirements: $435,000

Start-up Funding

Start-up Expenses to Fund: $285,000

Start-up Assets to Fund: $150,000

Total Funding Required: $435,000


Non-cash Assets from Start-up: $50,000

Cash Requirements from Start-up: $100,000

Additional Cash Raised: $0

Cash Balance on Starting Date: $100,000

Total Assets: $150,000

Liabilities and Capital


Current Borrowing: $0

Long-term Liabilities: $0

Accounts Payable (Outstanding Bills): $0

Other Current Liabilities (interest-free): $0

Total Liabilities: $0


Planned Investment

Investor 1: $370,000

Investor 2: $65,000

Other: $0

Additional Investment Requirement: $0

Total Planned Investment: $435,000

Loss at Start-up (Start-up Expenses): ($285,000)

Total Capital: $150,000

Total Capital and Liabilities: $150,000

Total Funding: $435,000

Company Locations and Facilities currently leases 5,000 sq. ft. of office space from Jiaotong University in Shanghai, China. Annual costs of our space is $30,000, or $2,500 per month, not including utilities. We estimate that this facility will accommodate up to 60 employees and will be satisfactory through Year 1. Additional space will be easily secured at a rate satisfactory to in the current facility maintained by Jiaotong University.

Our initial United States offices are located at 3750 Cheerful Dr., Suite 111, Sunnyvale, California in the heart of the U.S. high tech industry, where we share approximately 650 sq. ft. with Starmile. Annual costs of our space is $15,600, or $1,300 per month, plus escalations.

This plan anticipates the following growth in facility space required: in January 1, Year 2 increase facility space to 10,000 sq. ft in Shanghai, and in June 1, Year 2 increase facility space to 2,500 sq. ft. in the United States. The United States space will be easily secured at a rate estimated at approximately $3.00 per sq. ft. per month.

Services should be considered as a Business-to-Business-to-Consumer (B2B2C) Internet model due to our servicing both brokerages and their clients (our membership). We will be a technology facilitator by providing the conduit through which clients communicate with their brokerages. For members (brokerage clients), will provide a user configurable three-dimensional Web interface for trading Chinese equities and securities. This platform will facilitate equities trading by providing a seamless interface between the individual investor and his or her brokerage firm. Brokerage firms will realize the cost effective advantages of providing real-time market updates, news, technology, etc. to a greater clientele. Additionally, with maintaining a Virtual Private Network (VPN) for each brokerage, it provides a completely encrypted communication between the brokerages and their clients, allowing for safe and secure order transactions and account updates.

Service Description

We will incorporate features into the platform to improve the overall sophistication of traders:

– Internet Stock Trading: will cooperate with the China Security Regulatory Commission and member brokerage firms to provide a comprehensive trading platform for individual brokerage branches, including online order execution, confirmation, and account access.

– Real-time Updates: Market information will be updated in real time, giving the latest prices for all global major indexes. Real-time stock quotes will be available in a scrolling, ticker format with user-defined alerts and customizable configurations.

– News Updates: Direct links will be provided for instant access to recent news developments from around the globe. Video-on-demand (VOD) technology will be employed to allow traders to get up-to-the-minute broadcasts of market analysis from brokerages.

– Bank Transfers: will provide real-time money transfers between a user’s bank accounts and their brokerage firms.

– Fundamental and Technical Analysis: Members will have access to real-time stock market news and information. Advanced charting techniques will allow for a broad range of technical analysis capabilities.

– Market Recommendations: Economists and market analysts will provide their recommendations and economic outlook.

– Pager Transmission Services: will provide trading alerts to individual investors utilizing the latest technology for both 1-way and 2-way pagers along with Personal Digital Assistants (PDA’s).

– Chat Rooms and Forums: will provide a “community” for investor communications, facilitating the exchange of investment ideas and recommendations. This center will also provide online music and games for entertainment and relaxation.

– Staryoo Investors Club: A premium, value oriented membership that provides discounts on retail items, commissions, and free trading tips and recommendations.

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– Staryoo University.Com: This educational center will provide new investors with the knowledge and tools required for Internet investing. Allowing investors to practice online trading in a pseudo-trading environment will build confidence in their trading strategies and improve their overall online experience. Graduates of Staryoo will receive a Bachelor of Staryoo in Investment Technology (B.S.I.T.) degree and a certificate will be emailed to each graduate. Graduates will receive free membership into the Staryoo Investors Club that provides discounts on retail items, commissions and free trading tips and recommendations.

– E-Business/ will utilize its membership base to sell goods and products in a retail environment. Other investment vehicles such as stamps, coins, and antiques may be included.

– Planning: will provide various types of individual investment planning ranging from cash flow management to retirement planning.

– Customer Service:’s customer service staff will handle all customer questions regarding site functionality and its proper usage.

Service Description – Brokerages

Brokerages will realize the following advantages and services:

– Secure Virtual Private Network (VPN) communications between brokerages and their clientele. Using the SOCKv5 protocol, will allow implementation at the brokerage site with little additional hardware overhead.

– Brokerage branded Web page. will maintain a home page for each VPN brokerage, allowing its clientele to trade.

– Dynamic brokerage market updates and commentaries. Brokerages will have the ability to update their VPN home pages with brokerage-specific market updates.

– Lower Information Costs. will provide all news, market updates, quotes, etc. to clients.

– Pre-packaged CSRC Online Trading application. will provide brokerages with an application for the CSRC.

– Trading Frequency. Due to the “community” structure of the main site, investors will exchange ideas and investment strategies and ultimately increase their trading frequency.

– Scalable client base. As Internet access expands in China, membership will increase and a greater portion of the population will find investing more convenient and necessary.

– Collateral material. will provide all collateral material to brokerages for distribution to their clients.

– Quality News and Quotes. Members will receive real-time quotes from each exchange and financial news from Reuters.

– Web page design and maintenance. Initially, will provide standard Web design and functionality to brokerage VPN home pages.

– Advertisement brokering. will provide the purchasing and re-selling of brokerage Web page space for advertising.

– Wireless Transmission Protocol (WAP). Future services will allow brokerages to communicate market updates and news directly to their clients.

Competitive Comparison

There are several Internet trading websites in China, but their functionality is less than that planned for, and they offer little in the way of user functions such as technical/fundamental analysis, education, planning, pager alerts, forums, etc. Several well-known content providers in China may present potential competition to, but they do not have the investor base nor the expertise with brokerage firms, cryptography, and equities trading systems.


The key to fulfilling the individual investor’s online requirements will be for to keep an active dialog with our members. We must listen to their wants and needs and modify, add, and develop new resources as required.’s plans are to solicit product reviews and suggestions from members by giving discounted commissions, products, and/or services. These “Product Service Reviews” will be used as feedback for future technology and marketing developments and will ensure that our members are satisfied with their entire online trading and investing experience. Promotional giveaways will be provided to encourage membership interaction. It is only after the customers are satisfied that will enjoy a consistent and expanding investor membership.


China’s Internet access is expected to increase over 400% between June 1999 and the end of 2000. anticipates that Internet-based trading will quickly become accessible to many traders.’s technical team has extensive experience in data encryption and network communication security systems. has experience in the development of 3-dimensional animated interfaces for dedicated line trading products.

Future Services plans to offer a User Configurable Trading Platform (UCTP) that allows investors to customize their Web platform to meet their individual needs. Wireless transmission via WAP of emails, news, market updates, and stock quotes will be implemented. will continue to offer additional trading vehicles. With the advent of WTO membership, it is expected that Chinese investors will expand their trading horizons to include day trading.

Investment Website Business Plan Example

Market Analysis

Year 1 Year 2 Year 3 Year 4 Year 5 CAGR

Potential Customers Growth CAGR

Institutional Investors 20% 6,000,000 7,200,000 8,640,000 10,368,000 12,441,600 20.00%

Individual Investors 38% 55,200,000 76,176,000 105,122,880 145,069,574 200,196,012 38.00%

Total 36.53% 61,200,000 83,376,000 113,762,880 155,437,574 212,637,612 36.53%

4.2 Target Market Segment Strategy will target individual investors and position our website and services as a better way of handling securities transactions, accessing financial and market data, and strategizing on investments. According to International Data Corporation, 30% of individual investors will trade online by 2002. With an estimated 105 million individual investors by then, this equates to over 30 million online traders in China.’s trading platform, with its unique functionality and features, will be ideally suited for this group.

4.2.1 Market Trends

In the past, individual investors could access the financial markets only through full-commission brokers who offered investment advice and placed trades. These expensive full-service brokers prevented individual investors from trading the markets rapidly, as commissions and fees quickly eroded profits. Additionally, traditional brokerage firms restricted their clients’ access to trading and information to the availability of the person processing the transaction. With electronic brokerage services, investors now have the ability to unbundle the costs associated with human interaction required by full-commission brokers.

We believe that the increased presence of automated teller machines, the growth of discount brokers, and other indicators evidence a shift in demographics that is fundamentally altering the way consumers manage their personal financial assets. Access to information over the Internet and the growing availability of powerful, less expensive personal computers has helped create a new type of investor. This investor is more self-reliant, comfortable with technology, value-oriented, and accepts the Internet as a convenient, secure, and reliable means of commerce. Based on these developments, we believe that this trend has created a growing opportunity to provide online trading services, such as, that are easy to access, use, cost-effective, and secure.

4.2.2 Market Growth believes that the increased availability of information to individual investors on a real-time basis, together with government-sponsored advances in Internet access, networking and communications technologies, and China’s membership into the WTO, will create tremendous investing opportunities for web-based investors and market opportunities for Internet trading platforms. In the United States, online trading is the fastest-growing segment of the brokerage industry. Forrester Research, Inc. projects that the online trading industry grew from 1.5 million accounts at the end of 1996 to approximately 5 million accounts at the end of 1998, and the market will grow to 8.4 million accounts at the end of 1999, and 14.4 million accounts in 2002. Another industry report indicates that the number of online trades in the United States accounts for 25% to 30% of all individual investor stock transactions, and the volume of trades placed over the Internet increased by 34% from Q3 1998 to Q4 1998. Retail commissions generated by online trading are expected to grow from approximately $268 million in 1996 to as much as $2.2 billion by 2001!

4.2.3 Market Needs

Currently, there are a number of web-based trading platforms in China, but their interfaces and functionality are very inadequate for more sophisticated investors. We believe that as more investors utilize web-based trading platforms to manage their investment portfolios, they will expect their online platform providers to have broader capabilities. We believe these investors will differentiate among providers based on their capabilities. These capabilities must include:

– Customer-friendly and easy-to-navigate websites.

– Fast, secure, and reliable access to services.

– High levels of online and offline customer service.

– Efficient and quick order entry and processing.

– A wide range of investment tools.

– Educational services for customers.

– An ability to execute trades outside of current markets and market hours.

4.3 Service Business Analysis

The market for online investing services, particularly over the Internet, is new, rapidly evolving, and soon to be intensely competitive. will encounter direct competition from other Internet-based trading platforms and full-service brokerages providing touch-tone telephone, online investing services, or both. Additionally, we will also compete with financial institutions, mutual fund sponsors, and other organizations, some of which may provide online investing services. As China’s equity markets are opened to foreign investors and foreign investment in China increases, foreign web-based investing services will compete with

We believe that the principle competitive factors affecting the market for our services will be customer service, quality, delivery platform, ease of use, presentation layer look and feel, depth and breadth of services and content, innovation, and cost. We believe that we will compete favorably with respect to each of these factors. Our ability to continue to compete will also be affected by our ability to introduce new services and enhancements to existing services into the market on a timely basis.

4.3.1 Business Participants

There are several internet trading websites in China, but their functionality is less than that planned for and they offer little in the way of user functions. The most noted financial website is by Information Technology Co., Ltd., whose target is to become China’s top financial website. Established in 1995, Homeway is currently the only online investment advisor certified by the China Securities Regulatory Commission, though they do not currently offer web-based securities trading. Currently, there are only four websites offering some type of web-based trading platform, and each site’s total features are much less than those proposed by the site.

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Strategy and Implementation Summary

During FY2000, after the introduction of the trading platform, intends to advertise aggressively to build awareness of our brand quality, customer service, and depth and breadth of products and services. We intend to market our trading platform and services to individual investors by targeting traders through print, online, and other advertisements. Our strategy will be to position our website and services as a better way of handling securities transactions, accessing financial and market data, and strategizing on investments. Our advertising efforts are expected to include advertisements in financial publications and various other regional and national publications that have demographics similar to our target markets. We also intend to advertise and promote our platform through internet website banner advertisements and television commercials. Using advertising agencies such as 24/7 Media, Inc., which have direct affiliations with a wide range of websites including, may be a cost-effective method of achieving the broad range of impressions necessary to properly promote

Our initial marketing efforts will be concentrated in China. However, as part of our long-term goals, we plan to market our services to trading communities interested in Chinese equities and securities in other member WTO nations.

5.1 Strategy Pyramid

Most internet companies use a combination of marketing strategies for promoting their websites and building brand name awareness. has the additional advantage of the business relationships developed by Starmile in the financial industries. We feel that our target demographic is an investment-savvy male, affluent, and over the age of 25. will use the following strategies in the promotion of this new website to the targeted demographic:

– Strategy 1 – Business Relationships: Using existing relationships developed within the financial community will build site usage and recognition with the demographic most likely to be repeat users of our website and trading platform.

– Strategy 2 – Web-based Promotions: Using banner advertising on financial websites will increase brand awareness to a much wider audience while still maintaining our target demographic. Specific websites to be researched include,,, and China Business Weekly.

– Strategy 3 – Business Newspaper Advertising: Placing large ads in noted financial newspapers directing investors and businessmen to the site will provide greater penetration into our targeted demographic.

– Strategy 4 – Brokerage Clients: Since we will be working with and not in competition with brokerages, direct marketing to brokerage’s clients will help promote website awareness.

– Strategy 5 – Chinese American Citizens: Placing advertisements in newspapers devoted to the Chinese in America should attract those requiring to facilitate their trading.

5.2 Value Proposition

The value proposition offered by is to give our members a website that provides the most comprehensive array of financial products available in China for a reasonable and competitive rate. We believe that the site will provide our members with a convenient alternative for opening a brokerage account, bank transfers, and pager communications. Most importantly, will offer a 100% customer satisfaction guarantee for all products and services sold, thus building and retaining our members’ confidence.

5.3 Competitive Edge will follow a differentiation strategy to achieve a competitive advantage over other online trading providers in China. This differentiation will be based on the features and services provided by the site and include real-time updates, pager alerts, bank transfers, chat rooms and forums, financial planning, education, etc. We will be quick to respond to our members’ needs, both for additional services/functionality on the website, and with traditional customer service. will have both technological and marketing advantages over our competitors arising from the relationship Starmile has developed in the banking and financial industries.

5.4 Marketing Strategy has budgeted $100,000 per month for marketing and advertising, beginning in August 2000. All advertising prior to the June 1, 2000 deployment date will be used to build individual investor anticipation for the site.

– Strategy 1 – Business Relationships: Budget $15,000 for collateral material to be distributed to banking and financial institutions. Note that $60,000 is budgeted for June 2000 for initial creative and production costs. The remaining $30,000 will be used for re-runs and distribution through the course of the year. It is estimated that an initial distribution of $20,000 will be achieved through these institutions.

– Strategy 2 – Web-based Promotions: Budget $40,000 for banner/sidebar advertising on financial websites. Approximately $5,000 will be devoted to creative while the remaining $35,000 will be for ad placement. Given a CPM of approximately $25 (CBS MarketWatch rates), we can expect to have 1.4 million impressions per month. With a click-through rate of 0.8%, approximately 11,200 new prospective members will be attracted to the site each month. We will be aggressively tracking click-through rates and membership conversion rates for each type and location of web advertising done. Additionally, frequency will be capped at three so that impressions will not be lost on unattractable viewers.

– Strategy 3 – Business Newspaper Advertising: Budget $40,000 for advertising in financial and business newspapers. Approximately $5,000 will be devoted to creative while the remaining $35,000 will be for ad placement. Rates for the Business Weekly Newspaper are $5,000 per issue (xxx,xxx circulation). Our strategy will be to place ads consistently on a weekly basis so that our brand awareness is developed and identity remains consistent. This advertising strategy will also be used in America for Chinese Americans looking to trade the Chinese markets.

– Strategy 4 – Brokerage Clients: This will use similar collateral material as described in Strategy 1 above, with the exception that it will be personalized for a particular brokerage’s clients. We will budget $5,000 per month for this strategy.

5.4.1 Pricing Strategy will focus on attracting customers with a competitive price structure and comprehensive services and functionality. Income will be generated from several sources:

1. Brokerage fees from click-throughs to maintained VPN brokerage sites. Each brokerage will be implemented as a VPN maintained by Billing will occur similar to the Application Service Provider (ASP) model, where every time the VPN Brokerage site is accessed, the brokerage will be charged an access fee of $0.125 (1 RMB).

2. Fees charged to members for trading alerts.

3. Revenue generated from e-business. Commissions will be charged based on products sold from various vendors.

4. Charge members a fee for various information, analysis, and services provided on a tiered system dependent upon content required. To build membership and usage, this revenue stream will not be implemented until 2002.

5. Advertisement and promotional fees. will provide banner advertising to prospective clients wishing to reach a wide and affluent internet audience.

6. The membership database represents tremendous value as a potential customer list. Interested companies wishing to target similar demographics will be charged for access to our membership list.

5.4.2 Promotion Strategy

Outlined below are some of the promotional strategies that will be initially implemented to drive membership:

– Discounted retail purchases.

– Discounted or free bank transfers for active traders.

– Discounted or free alerts for service sign-up.

– Free membership into the Staryoo Investors Club – our premium, value-oriented membership club that provides discounts on retail items, commissions, and free trading tips and recommendations.

– Free choice of an investment book for graduates of Staryoo Each graduate will receive an emailed certificate indicating that they have obtained a Bachelor of Staryoo in Investment Technology (B.S.I.T.) degree. Graduates will receive free membership into the Staryoo Investors Club.

– Guess the Hang Seng, Shanghai, and Shenzhen market indexes at the end of each week. Winners will receive commission rebates, computers, public recognition, etc.

5.5 Sales Strategy

We feel that sales will be directly proportional to the number of members using Starting with less than 1,000 active members in June 2000, our goal is to secure 18,000 members by December 2000, 80,000 members by December 2001, and 152,000 members by December 2002. The rapid membership escalation in 2002 will be realized with increased advertising and manpower. Important assumptions are highlighted below:

– Members access their VPN Brokerage site 30 times per month.

– Secure two brokerages per month.

– Actual brokerage online trading does not occur until three months after the initial sign-up of the brokerage due to the CSRC online trading application.

– Each brokerage has approximately 20,000 clients.

– Achieve 15% penetration of the client base for VPN access, starting out with only 10%, increasing to 13% in 2001, and 15% in 2002.

– Pager Alerts are charged at $0.50 per transmission.

– Initially, only 10% of members use the Alert feature.

– Premium membership fees do not occur until 2002.

– Each member spends $50 annually on retail purchases, and earns 20% on transactions.

– Direct Costs of Sales are estimated conservatively at 10% due to advertising creation, promotional discounts, and "Product Service Review" fees.

The annual sales projections are included below.

Investment Website Business Plan Example

Investment Website Business Plan Example

Sales Forecast

Year 1 Year 2 Year 3


VPN Brokerage Access Fees $207,500 $2,331,000 $5,373,000

Pager Alerts $11,066 $124,320 $286,560

Advertisement Fees $55,334 $621,600 $1,432,800

E-Commerce $46,112 $518,000 $1,194,000

Other $0 $0 $1,363,800

Total Sales $320,012 $3,594,920 $9,650,160

Direct Cost of Sales

Year 1 Year 2 Year 3

VPN Brokerage Access Fees $20,750 $233,100 $537,300

Pager Alerts $1,107 $12,432 $28,656

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Advertisement Fees $5,533 $62,160 $143,280

E-Commerce $4,611 $51,800 $119,400

Other $0 $0 $136,380

Subtotal Direct Cost of Sales $32,001 $359,492 $965,016

5.6 Strategic Alliances

Strategic alliances are crucial for realizing the revenue streams we anticipate. These alliances must be forged in two main areas: the banking industry and with financial brokers. We will pursue relationships with affinity partners to increase access to potential customers, build brand recognition, and expand our product and service offerings. Advertising expenses for start-ups to attract new customers range from 48% to 285% of revenue. We believe focusing on affinity relationships will result in lower account acquisition costs and advertising expenses compared to other internet-based businesses. We will build these alliances based on our working relationships through Starmile. Additionally, we will develop e-commerce relationships with partners who sell retail items on our website and seek reciprocal agreements with online data providers (e.g., to share data and members through promotional programs. We intend to expand this affinity program and explore potential relationships with new partners in the future.

5.7 Milestones’s milestones are shown in the following table. They track the need to follow up on strategy with specific activities over the next 12 months. Most activities can be linked to our goals of increasing membership and enhancing the functionality and features of our trading platform.

Investment Website Business Plan Example

Milestone Start Date End Date Budget Manager Department
Alpha Testing Platform 1/15/2000 4/15/2000 R&D Expense John Wu Technology
Develop Comprehensive Mktg. Plan 4/15/2000 5/15/2000 R&D Expense Mr. Zang Mtkg./Adv.
Secure $8M Venture Funding 1/3/2000 5/30/2000 $50,000 Johnson Corporate
Brokerage Firm Agreements (2) 1/3/2000 6/1/2000 Legal Expense Mr. Zhang Mtkg./Adv.
Beta Testing Platform 4/15/2000 6/1/2000 R&D Expense John Wu Technology
Trading Platform goes online 1/1/2003 6/1/2000 R&D Expense Mr. Xu CTO
Develop Comprehensive Security Plan 5/1/2000 7/31/2000 $35,000 Subcontracted Corporate
Implement Online Trading (1st brokerage) 5/1/2000 9/15/2000 Expensed John Wu Information
Sign Up 18,000 Members 6/1/2000 12/31/2000 Expensed Mr. Zang Mktg./Adv.
Totals $85,000

Management Summary

The initial management team relies on the founders themselves, with significant engineering resources employed by Starmile, based in Shuzhou, China. As of May 1, 2000, has 28 full-time employees, including a CEO, COO, CTO, and two vice-managers responsible for Information, Marketing, and Advertising in China.

6.1 Organizational Structure

Recognizing the unique circumstances of a U.S. company developing a product for the Chinese markets, the management structure must remain flexible. In the short term, the current management team will secure the first round of venture capital and oversee the alpha and beta testing of the trading platform. Starmile will handle technical development, with a transfer of engineering talent to planned for May, 2000. A Chief Financial Officer (CFO) will be hired by August, 2000.

6.2 Management Team

Mr. Cio, Quigdo, former vice president/CTO of Zheijiang ICBC (the largest commercial bank in China) has nearly 20 years of experience in financial software and hardware development. Mr. Cio is an expert on computer technology application in the financial industry and played a crucial role in advancing technology in the China banking industry, including China’s first debit and credit cards and the first minicomputer used for accounting systems in banking and computerized deposit systems.

Mr. Smith, John, CEO and founder of Starmile, and president of DoubleTime Electronics, Inc., is a noted entrepreneur and pioneer in technology development for the banking industry in China. Mr. Smith started Starmile in 1994 with just $6,000 and four employees. The company now has 320 employees and annual sales of $13.7 million. DoubleTime Electronics, Inc. was founded in 1993 and has over $10 million in assets. Mr. Smith worked as head of the software development department in Zhejiang ICBC for ten years while developing banking accounting, MIS, and document processing systems. Mr. Smith has published several papers and articles on Management and New Technology Applications in the Financial Industry.

Mr. Tsu, Ben, vice president and Chief Technology Officer in Shuzhou for Starmile, is responsible for major technological research and development. Mr. Tsu has directly contributed to products generating over $20 million in revenue. Mr. Tsu was a key developer of the first and second versions of China Securities Brokerage Firm Trading Systems. Mr. Tsu graduated with honors from Beijing University with a Bachelors of Science in Electrical Engineering in 1992.

Mr. John, Don, vice president of Starmile and CEO at, is responsible for technology and business development. Mr. John worked as a software engineer and engineering manager in the Eastern Business Tech Corporation for two years, MIS and Business Development manager at BP Tech Corporation for three years, and Engineering Manager at DoubleTree Electronics, Inc. for one year. Mr. John received his Bachelors of Engineering in the Application of Math and Computer Science, his Masters of Engineering in MIS, and a Ph.D. in Finance from Shanghai University. Mr. John also holds a Master of Science in Engineering Management from Gonzaga University in 1993.

Mr. Grey, Ronald, COO of and CEO/founder of Pacific Food, Inc., joined in January, 2000. Mr. Grey is responsible for overseeing the development and deployment of’s trading platform in China and the United States. From 1993 to 2000, Mr. Grey was CEO of Pacific Food, Inc., an entertainment/food service company located in Orlando, FL, responsible for all business development, accounting, and human resources. From 1983 to 1993, Mr. Grey worked as Product Engineering Supervisor and Product Engineer in Product Development for LSI and Intel. Mr. Grey graduated Cum Laude from the University of Delaware with a Bachelors of Science in Electrical Engineering in 1983.

6.3 Management Team Gaps is currently searching for an experienced Chief Technology Officer from the United States. The Chief Technology Officer position will be hired by June, 2000 to provide brokerages with a secure virtual private network for client communication. Starmile will provide significant marketing and technology expertise through the alpha and beta testing of the platform. A Chief Financial Officer will be hired by August, 2000 to oversee the company’s budgets. The company will hire engineering, customer service, accounting, and clerical staff as necessary to achieve the timelines presented elsewhere in this plan.

Our success depends on hiring and retaining qualified marketing, industry, technical, and financial personnel. Qualified personnel are in high demand. We face considerable competition from other service firms and Internet and online service companies, many of which have greater resources than we do. To attract and retain talented and qualified employees, we offer equity positions in the company. A stock option plan allows employees to participate in our ownership and growth through the grant of incentive and non-qualified options. By offering stock options and grants to employees, we ensure their loyalty and active participation in the success of

Use of contracts for various services via B2B Internet companies may be necessary to expedite the infrastructure of various departments such as human resources, administrative personnel, and finance.

Advisors to the Board of Directors will be added to our team as opportunities and individuals present themselves.

6.4 Personnel Plan

The following tables summarize our personnel expenditures for the first three years, with compensation increasing from approximately $534,000 in the first year to $2.8 million in the third. We believe this plan is an equitable compromise between fairness and expedience and meets the commitment of our business plan. Since is being developed in China for the Chinese markets, initially, a majority of the labor will be personnel from China. The Personnel table is separated into staffing for both China and America, with salaries commensurate with the location. will gain a tremendous advantage by using the relatively inexpensive labor pool available in China. A typical software engineer in China receives a salary of approximately $500 per month versus the American counterpart at approximately $5,000 per month. The detailed monthly personnel plan for the first year is included in the appendix.

The table below breaks down the anticipated staffing growth in each department (US/CN):

Department 2000 2001 2002
Management 2/3 2/3 2/3
Engineering 2/18 4/22 7/30
Sales and Marketing 0/6 2/12 8/20
Customer Service 0/5 0/7 8/10
Finance 0/3 0/5 0/10
Miscellaneous Staff 1/6 2/10 3/15
Total 46 69 116
Personnel Plan
Year 1 Year 2 Year 3
CEO – USA $93,950 $105,000 $135,000
COO – USA $87,700 $95,000 $120,000
Vice-Manager Mktg & Adv. – China $35,000 $55,000 $65,000
CTO – China $40,000 $60,000 $75,000
CFO – China $42,000 $55,000 $70,000
Engineering Staff – USA $44,000 $288,000 $595,000
Engineering Staff – China $75,000 $132,000 $180,000
Sales & Advertising Staff – USA $0 $120,000 $560,000
Sales & Advertising Staff – China $14,000 $57,600 $96,000
Customer Service Staff – USA $0 $0 $336,000
Customer Service Staff – China $9,200 $33,600 $48,000
Accounting Staff $10,000 $25,000 $60,000
Miscellaneous Staff – USA $17,500

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