Entrepreneurs Dynamic Business Network

INTERNATIONAL BUSINESS SCHOOL
UNIVERSITI TEKNOLOGI MALAYSIA
Business Plan
Entrepreneurs Dynamic Business Network
Prepared by:
Mohd Faizal Yusof (MR051065)
GRADUATE PROJECT
MOHD FAIZAL BIN YUSOF
MR051065
GRADUATE PROJECT MR051065
Business Plan: ENTREPRENEURS DYNAMIC BUSINESS NETWORK
Terms and Abbreviations
Term / Abbreviation Meaning
EDBNSB Entrepreneurs Dynamic Business Network Sdn Bhd
EDBN Entrepreneurs Dynamic Business Network
SME Small Medium Enterprise
PNL Profit & Loss / Income Statement
MARA Majlis Amanah Rakyat
MeCD Ministry of Entrepreneur and Cooperation

Development
2007 Created on 08/11/2007 Page 2 of 60

Table of Contents
1. E X EC UT IV E SUM M AR Y . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2. PU R PO S E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3. CO M P ANY D E S CR I PT IO N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.1. VISSION ........................................................................................................................... 8
3.2. MISSION .......................................................................................................................... 8
3.3. START-UP SUMMARY.................................................................................................. 8
3.4. DEVELOPMENT TO DATE ........................................................................................... 9
4. IN DU ST RY AN AL Y SI S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 0
4.1. OVERVIEW .................................................................................................................... 10
4.2. NATIONAL AGENDA .................................................................................................. 11
4.3. IMPORTANCE OF ICT ................................................................................................ 12
4.4. NINTH MALAYSIAN PLAN ........................................................................................ 14
4.5. KEY SUCCESS FACTORS ......................................................................................... 15
4.6. ENTREPENEUR COMMUNITY .................................................................................. 16
5. SU CC E S SF UL O N LI N E CO M M UNIT Y . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 7
5.1. COMMON INTEREST .................................................................................................. 17
5.2. PERSUASIVE ............................................................................................................... 18
5.3. COLLABORATION ...................................................................................................... 19
5.4. FUN PLACE .................................................................................................................. 19
5.5. LIQUIDITY ..................................................................................................................... 20
6. PR O D UCT S & S ER V I CE S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 1
6.1. PRODUCTS & SERVICES DESCRIPTION .............................................................. 21
6.2. COMPETITION ............................................................................................................. 25
6.3. REVENUE MODEL ....................................................................................................... 26
6.4. OUTSOURCING ........................................................................................................... 27
6.5. FUTURE PRODUCTS & SERVICES ......................................................................... 28
7. M ARK ET IN G & S AL E S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 9
7.1. MARKET SEGMENTATION ....................................................................................... 29
7.2. MARKETING STRATEGY .......................................................................................... 29
7.2.1. Positioning Statement ............................................................................................................................ 31
7.2.2. Promotion strategy................................................................................................................................... 32
7.2.3. Marketing Programs................................................................................................................................ 32
7.3. S ALES S TRATEGY ........................................................................................................... 32
7.3.1. Sales Forecast ........................................................................................................................................... 33
8. O P E R AT IO N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 4
9. M AN AG EM E NT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 7
9.1. O RGANIZ ATIONAL S TRUCTURE ...................................................................................... 37
9.2. M ANAGEMENT T EAM ...................................................................................................... 37
9.3. B OARD OF D IRECTORS ................................................................................................... 39

9.4. P ERSONNEL P LAN .......................................................................................................... 39

10 . FIN AN C I AL P L AN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 0
10.1. START-UP COST ......................................................................................................... 40
10.2. OPERATING BUDGET ................................................................................................ 40
10.3. PRO FORMA PROFIT & LOSS (INCOME STATEMENT) ..................................... 41
10.4. PRO FORMA CASH FLOW ........................................................................................ 42
10.5. PRO FORMA BALANCE SHEET .............................................................................. 43
10.6. BREAK-EVEN ANALYSIS .......................................................................................... 44
10.7. RATIOS ANALYSIS ..................................................................................................... 45
11 . RE F ER E NC E S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 6
12 . AP P E N D I X A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 7
13 . AP P E N D I X B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 9
14 . AP P E N D I X C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 0
List of Tables & Figures

TABLE 9.4 PERSONNEL COST ESTIMATES ................................................................................................. 39
TABLE 10.1 FIRST 3 MONTH START-UP EXPENSES .................................................................................... 40
TABLE 10.2 OPERATING BUDGET ............................................................................................................. 40
TABLE 10.3 INCOME STATEMENT.............................................................................................................. 41
TABLE 10.4 CASH FLOW .......................................................................................................................... 42
TABLE 10.5 BALANCE SHEET ................................................................................................................... 43
TABLE 10.6A CONTRIBUTION MARGIN RATIO ............................................................................................ 44
TABLE 10.6B BREAKEVEN UNITS .............................................................................................................. 44
TABLE 10.7 RATIOS ANALYSIS ................................................................................................................. 45
TABLE APPENDIX A YEAR 1 PROFIT & LOSS (INCOME STATEMENT) ............................................................ 48
TABLE APPENDIX A YEAR 1 CASH FLOW ................................................................................................... 54

Graduate Project MR051065
1. EXECUTIVE SUMMARY
Online communities are manifestation of mankind unique characteristic as

social beings. When the Internet appears, online communities are being formed
to take advantage the new medium of communication and sharing between
individual with similar interest. Such communities are to certain extends are
Internet transformation of offline communities. Even prior to the Internet,
millions of people have joined clubs such as Rotary Clubs, Golf Associations,
Persatuan Ibu Bapa dan Guru (PIBG) and fraternities in US campuses. The
members are searching for something previously missing in their lives. Maybe
its to become healthier, or to help others with the same physical problems, or
to raise money for disaster victims or to support the poor. Online and
conventional communities share similar traits where their core purpose remains
to search, process and share (Silver, 2007).
In this business plan, we are proposing the development of unique business

network through creation of an online entrepreneurs community. Known as
Entrepreneur Dynamic Business Network (EDBN), it will provide the platform
for entrepreneurs to share contents in various formats, participate in new
ventures, trade in electronic commerce as well as offering their services and
products. Members are encouraged to share entrepreneurship-related
materials such as articles, e-books, training videos, images etc.
Being a member comes with list of privileges including access to numerous

databases and services such as:
User generated entrepreneurship materials
Matching service between venture capitalist & entrepreneurs
Business to Business (B2B) marketplace
Business to Consumer (B2C) Online Shops
Access to business services offered by third parties or fellow members
EDBN Sdn Bhd as the company operating the business network will generate
revenues from several conventional as well as non-conventional methods
2007 Created on 2007-09-13 Page 5 of 60

including membership fees, tip jar system, venture capital matching service
fees, B2B transaction commissions, B2C online shops premier fees and third
party service provision fees. EDBN Sdn Bhd will be responsible to develop and
maintain super online platform for members to share and communicate as if
they were face to face. Similar to Wikipedia, some level of verification and
authorization mechanism will be managed by EDBN Sdn Bhd to ensure that
only relevant materials, services and products are uploaded and shared in the
community.
Based on our thorough analyses including market and financial, as captured in

this business plan, we strongly convinced that this community will be a
successful if implemented for Malaysia. It can also be replicated for other
countries, trade blocks and regional organizations such as ASEAN.
2. PURPOSE
This business plan is written for EDBN Corporation to build and operate an
online entrepreneur business network, capture memberships, define revenue
model as well as identifying the short term marketing, financial, operation and
management plan.

3. COMPANY DESCRIPTION
Entrepreneurs Dynamic Business Network Sdn Bhd will be a private-owned

private limited company focusing in developing and operating entrepreneurs
communities referred to as EDBN.
EDBN is a membership-based community which provides members with list of

privileges that assist members to share user generated contents, secure
funding, B2B e-commerce trading, setup online stores as well as access to
business services offered by various organizations including fellow members.
EDBN memberships are by invitation only. It will be appealing to existing

entrepreneurs and those who are interested in entrepreneurship. That includes
individuals and groups that are keen to share useful information in the
community. EDBN provides enabling environment for effective information
sharing between entrepreneurs and fellow entrepreneurs.
The development of EDBN Network is based on 3C, that is:
Connectivity to improve networking, productivity and competitiveness of

entrepreneurs.
Communication among entrepreneurs as well as with government

agencies.
Content as a platform for sharing user generated contents, information,

software applications and expertise.
EDBN has four objectives:
Reduce gap in term of technology exploitation among entrepreneurs in

Malaysia.
Provide interactive platform for members to share, discuss,

communicate and conduct business transactions.
Provide e-commerce platform for Malaysian entrepreneurs trading with

local and foreign companies.

Assist in development of minority group entrepreneurs, i.e. rural

entrepreneurs, young, women, indigenous and micro-sized
entrepreneurs.
3.1. VISSION
To provide enabling environment for entrepreneurs to share, communicate,

learn and work together to create successful ventures.
3.2. MISSION
We are in business of building entrepreneur community with focus in building

minority group entrepreneurs. Through our community, members have access
to a list of privileges useful in starting, running and expanding businesses.
Members can share, discuss, learn and communicate with fellow members,
participate in B2B and B2C ecommerce as well as access to list of useful
business services offered by fellow members.
3.3. START-UP SUMMARY
Start-up costs will be approximately RM 150,000.00 which will include

development of the product either through R&D or improvisation of existing
technology, software development, brand and logo design, company formation,
license and permit acquisition, facility rental deposit, and computer hardware. It
is expected that the start-up costs will be financed mostly by grant(s) from
venture capitalists under negotiable terms and conditions.
All computer hardware will be acquired from DELL Malaysia known for its
superb after-sales support and relatively low prices. Sample specifications are
attached in APPENDIX C section.

3.4. DEVELOPMENT TO DATE
The management is in the process of securing capital from interested venture

capitalist. EDBN head office will be located in Kuala Lumpur. Five individuals
have agreed to be the founding team consisting of two individuals with
management background and three with technical background. The team has
successfully worked together in development projects in the past.

4. INDUSTRY ANALYSIS
4.1. OVERVIEW
According to definition posted on National SME Development Council (NSDC)

(www.smeinfo.com, 2007), SMEs are defined as follows:
SMEs in Malaysia account for 99.2 percent or 518,996 of total establishments

in the three (3) key economic sectors, namely manufacturing, services and
agriculture. Large establishments numbering 4,136 accounted for the remaining
0.8 percent. Most of the SMEs predominate in the services sector, accounting
for 86.5 percent of the total establishments. Their presence in the
manufacturing and agriculture sectors are only 7.3 percent and 6.2 percent
respectively. Employment generated by SMEs was approximately 3.0 million
workers (65.1 percent) of the total employment of 4.6 million engaged in the
three (3) main sectors.

The services sector employed the largest number, 2.2 million, followed by the
manufacturing sector, 740,438 and agriculture sector, 131,130. Full-time
employees totaled 2.3 million workers (76.5 percent) while self-employed
workers made up 16.7 percent and part-time workers, the remainder (6.8
percent).
The role of SMEs in the Malaysian economy is demonstrated by their
contribution to output and value added, RM405 million and RM154 million
respectively in 2003 (see Table 2). In terms of share contribution, SMEs
accounted for 43.5 percent of total output and 47.3 percent of value added. It is
noted that SMEs in the services sector contributed the largest share, 56.7
percent and 54.7 percent respectively. SMEs in the manufacturing sector saw a
34.9 percent contribution in output and 37.1 percent in value added (Mohd Aris,
2006).
These figures show that SMEs play an important role in sustaining domestic
and regional economic growth, in addition to being important agents for
alleviating poverty. It should be acknowledged that SMEs represent one of the
important segments of the Malaysian economy. Thus, entrepreneurship among
society should be encouraged by providing an enabling environment.
4.2. NATIONAL AGENDA
In theory, entrepreneurs and SMEs provide excellent mechanism for

developing nations to grow. SMEs provide jobs, innovative products and
improve efficiencies in society as a whole. Realizing this importance,
Government of Malaysia has embarked on numerous national plans and formal
initiatives to increase and sustain the development of entrepreneurs and SMEs
in Malaysia. The following are some of these initiatives:
Second Industrial Master Plan
Third Outline Perspective Plan
Eighth Malaysia Plan (8MP)

Ninth Malaysia Plan (9MP)
4.3. IMPORTANCE OF ICT
The current development in the business world as a result of technological

advances, in particular the Internet, exposes many entrepreneurs and their
enterprises to many challenges that affect their businesses both domestically
and internationally. The Internet has created a borderless world making
business communications never been easier. A new playing field has been
created where businesses have equal access world market. This requires
Malaysian companies to enhance their competitiveness to survive. Cost must
be minimized and companies must comply with required regulations and
standards.
As recent as the year 2005, outsourcing is the trend among multinational

corporations (MNCs) and large companies to gain competitive advantage and
operational efficiencies. Department like ICT, human resource, call centers and
even finance has been outsourced to competent companies all across the
globe. Notably, India has emerged as one of the major ICT outsourcing
destinations. In order to exploit and take advantage and be part of this
outsourcing business, Malaysian SMEs must meet requirements set by MNCs
and large companies. These requirements include acceptable cost, quality,
efficiency and delivery system.
All these factors can be achieved through the utilization of ICT one way or
another. ICT can improve business process efficiency and productivity. SMEs
can reduce operational costs by improving procurement, transaction and
manufacturing resulting in lower overall cost and higher quality output. The
efficiency and effectiveness of the delivery system can be achieved through the
utilization of ICT which integrates SMEs into the global supply chain. ICT can

also facilitate global connectivity transforming the mechanism of creating and

delivering products and services on a global scale. New business models and
market configurations enabled by ICT, including business process outsourcing
and value chain integration, provide the SMEs with access to new markets and
new sources of competitive advantage, to drive income growth.
In order to survive the global business environment characterized by rapid

advance in ICT, globalization, liberalization, and greater reliance on knowledge
for value creation, Malaysia plans to leapfrog into the post-industrial age by
leveraging ICT as a strategic lever for national development and global
positioning.
Even in vision 2020, which envisages a fully developed, knowledge rich

Malaysian society by the year 2020, stresses the importance of the
development of the ICT sector and the use of ICT, to gain global
competitiveness. Malaysia's Multimedia Super Corridor (MSC) has been
created to provide a high-tech environment and infrastructure that can attract
national and international investors and create spillover effects in the rest of the
Malaysian economy.
As part of Vision 2020, Malaysian government has provided incentives in order

to encourage the development of SMEs. Entrepreneurs development has
received attention in the country annual Budget year after year. Specifically,
ICT industry has received many benefits from those budgets in various formats.
There are many government assistance plans, including financial help, tax
incentives, and business advisory assistance to support the SMEs, but many
SMEs in Malaysia are still unaware of the various assistance programs
provided and supported by the government. Many agencies have been formed
to assist certain focused group within entrepreneur communities. Some of the
agencies are TEKUN, PNB, PUNB, Bank Rakyat, SME Bank etc.

SMEs should realize that the economy and business are shifting towards a new
world flooded by digital information and knowledge-based work. Therefore,
SMEs should see the adoption of ICT as inevitable. SMEs should also look
upon ICT as a tool to stay alive and be able to compete on a level playing field
with their foreign counter part. SME owners need to take on this challenge
seriously and find out how business intelligence and knowledge management
solutions as well as new economy related assistance schemes offered by the
government can assist them.
SMEs need to embrace the state-of-art technologies to penetrate non-

traditional markets and remain competitive in the face of increasing challenges
posed by globalization, liberalization and technological advances.
4.4. NINTH MALAYSIAN PLAN
The main objective of Ninth Malaysia Plan (9MP) is to enhance national

competitiveness and resilience. As such, its key priorities include developing
competitive and resilient entrepreneurs and SMEs that are equipped with
superb technical and innovation capacity, as well as managerial and business
skills. In other words, emphasis will be placed on strengthening the capacity
and capability of SMEs to enable them to innovate, produce quality products
and services at competitive costs and integrate into international supply chain.
Apart from that, the plan also stresses on strengthening financial infrastructure
to enhance SMEs access to financing.
The focus for SMEs in the manufacturing sector will be to upscale towards
higher value added activities and upgrade in capacity of related services, in an
effort to transform businesses into strong knowledge intensive and value
creating entities. In the agriculture sector, the emphasis will be on developing
New Agriculture which will involve expanding large scale commercial farming
and high quality and value added processing and biotechnology.

As depicted in the official Ninth Malaysia Plan document, the government has
identified five key thrusts for the 2006-2020 phase toward achieving Vision
2020. The five
To move the economy up the value chain
To raise the capacity for knowledge and innovation and nurture first
class mentality
To address persistent socio-economic inequalities constructively and
productively
To improve the standard and sustainability of quality of life
To strengthen the institutional and implementation capacity
We have to acknowledge that the plan has put much emphasized on the
importance of SMEs to Malaysian socio-economy. This proposed
entrepreneurs community is very much complementing and supporting existing
and future government initiatives as part of Ninth Malaysia Plan. Our
community will provide an enabling environment for doing business, enhancing
small and medium enterprise development, increasing public-private
partnership as well as attracting targeted high-quality foreign direct investment.
4.5. KEY SUCCESS FACTORS
The most basic ingredients for SMEs to survive and grow in todays globalize
and challenging environment is being competitive and resilient. In order to
achieve that, SMEs need to continuously strengthen their capacity and
capability to produce high quality products and services at competitive prices.
Strengthening of capacities and capabilities would involve:
Acquiring of new skills, techniques and technologies to improve their

business operations.
Strengthening capability in marketing and promoting their products.
Have capability to undertake proper financial management of their
businesses.
Building capacity and capability in seven areas:

o Marketing and promotion

o Training and human resource development
o Advisory services
o Entrepreneur development
o Technology development
o Product development
o Awareness and outreach
In formulating solutions to improve and grow SMEs, any proposal must
acknowledge and address one of the main issues facing SMEs. Most of them
face constraints on resources that may limit their ability to enhance capacities
and capabilities. They generally lack economies of scale and may incur high
costs in acquiring and utilizing technologies and upgrading skills of their
manpower. The SMEs also tend to have limited access to timely and accurate
information on market opportunities, financing and technology advances.
4.6. ENTREPENEUR COMMUNITY
The Malaysian business communities have been associated with many local
trade associations. Many of these associations are formed to protect the
interest of certain racial groups. Some of the big ones are Malay Chamber of
Commerce Malaysia (MCCM), Malaysian Associated Indian Chamber of
Commerce and many local Chinese Chambers of Commerce like Kuala
Lumpur & Selangor Chinese Chamber of Commerce.
These associations are legacy associations resulted from history of turmoil
relationships between business community and the government. The
associations were founded to protect the interest of the business community.
This shows the important role of associations or communities play in the
business world. EDBN is about providing enabling environment in getting tech-
savvy generations that grow up with the Internet to come together as member
of online entrepreneur community. EDBN will enable entrepreneurs to join sub-
communities based on their preferences based on racial group, gender and
locations.

5. SUCCESSFUL ONLINE COMMUNITY
There are quite a number of successful online communities where unique

visitors are in the millions. The following statistics is excerpted from the book
Smart Start-Ups (Silver, 2007):
The 20 Most Mobbed Online Communities (Unique Visitors

through June 2006 (in millions)
June June Percentage
Name 2005 2006 Change
MySpace.com 17.7 52.3 195
Classmates.com 18 14 -22
Facebook.com 6.1 13.8 126
YouTube.com - 13.4 -
Spaceslive.com 3.9 8.7 123
Xanga.com 8.1 6.8 -16
Flickr.com 1.1 5.9 436
360.Yahoo.com - 4.7 -
LiveJournal.com 6.3 4.1 -
MyYearbook.com - 4 -
Hi5.com 3.4 2.1 -38
Tagged.com 0.7 1.8 157
Bebo.com 1.6 1.7 6
Friendster.com 1.1 1.4 27
TagWorld.com - 1.3 -
Y3Things.com - 1.2 -
Linkedln.com 0.2 0.3 50
Orkut.com 0.05 0.3 500
XuQa.com - 0.1 -
Cyworld.com - 0.09 -
Source: Wall Street Journal Online, July 24, 2006.
Even though, these communities sometimes lack clear business model.

Nevertheless, due to their success in attracting large number of members, their
value has skyrocketed. Some have been sold for very large amount of money.
YouTube was sold to Google for USD 1.65 billion in 2006.
5.1. COMMON INTEREST
Though most of the successful online are based on social networking, a very
specific common interest or genre must be identified for an online community to
be successful. In the case of EDBN, the common interest is entrepreneurship.
Entrepreneurs have the opportunity to share, learn, trade and communicate

with one another bound by the common goals of being successful in business
while at the same contributing back to society.
In order to attract high number of members that are willing to pay monthly or
annual subscription, the community must posses certain values as
recommended in the book Influence: The Psychology of Persuasion by Robert
Cialdinis.
5.2. PERSUASIVE
Reciprocity
The membership should provide members for free with useful information in the
form of newsletter, e-books, training materials and videos as well as software
products, gifts, services or goodies. When getting something for free members
will feel the obligation to reciprocate.
Consistency
The membership should ensure positive feedback from the public. Toward this
end, it requires good after-sales support resources and systems. Decisions that
are validated by public affirmation will ensure the members stay as members.
Social Validation
Effort must be taken to ensure that the membership receive positive comments
from existing members. Any dissatisfaction must be rectified as soon as
possible. Comments from online forums and other communication channels
must be handled tactfully. People always make decisions to purchase
something if others validate their choice.
Liking
People often say yes to people they like and cooperative. In other words,
people will join if people they have chemistry with such as friends, partners and
relatives join as members. Membership by invitation is perfect for this
requirement.

Authority
Support and validation from authority figures provide influence for potential
members to join the community. People always think that authorities know more
than they do about certain things. Strategic alliances with government agencies
such as MECD and MARA are perfect for this requirement.
Scarcity
It is know that people do assign a higher value to scarce items. In this case the
community should be restricted to certain group of people to create sense of
scarcity and being part of a privileged group of society. American Express has
thrived on such dogma.
5.3. COLLABORATION
Exactly the same level as food, clothing and shelter, we need to collaborate
with fellow human beings as part of our basic needs to sustain us. We human
seem to have an innate social contract an implicit agreement among
members of a society to cooperate for a genetically required benefit (Silver,
2007).
Building an online platform that was designed with conscious intention to assist
members to collaborate will ensure the success of the community.
5.4. FUN PLACE
Human as social beings are attracted to place where they can have fun.
Logically, our online community has to be a fun place for members to bond and
socialize with fellow members.
Existing online communities where members regularly meet in real life are
more sustainable because they solve the pain of loneliness better than do
communities whose members always stay pseudonymous.

5.5. LIQUIDITY
A successful community must have liquidity where members are given the
opportunity to share, trade and exchange fungible objects for real money,
virtual money, tip-jar money or synthetic money.
Second Life, one of the successful online social community, is known to have
its own currency exchangeable to US dollar fluctuate similar to foreign
exchange.

6. PRODUCTS & SERVICES
The following products and services will be offered by EDBN. The products and
services are formulated in order to build a sustainable entrepreneurs
community. It also addresses the problem facing SMEs in order for them to
enhance their capabilities and capacities as part of their continuous effort to
stay competitive and resilient.
6.1. PRODUCTS & SERVICES DESCRIPTION
In a community context, this section describes the privileges of being a

member. Members have the opportunity to offer and consume products and
services offered by fellow members. The products and services offered can be
group into four main categories; Sharing & Communicating, New Venture
Matching, B2B Dynamic Marketplace, B2C Online Shop, Services Matching
and CSR Community Services.
Share & Communicate
With common interest in entrepreneurship, members can share with each other
user generated contents in the form of entrepreneurship-related materials such
as:
o Articles
o Videos
o Newsletters
o e-books
o Seminar & workshops
EDBN will provide the platform to ease members to upload, share and manage
their own contents. As part of the incentives for members to contribute, rewards
should be awarded for the best contributions for each format. The rewards
could also be gathered as tip-jar collected from members who have benefited
from the contents and willing to provide tips for members. EDBN could split the
tips collected with the author where EDBN keeps 30% of the tips while the
author takes the rest.

Venture Capitalist & Entrepreneurs Matching
Matching service between venture capitalist & entrepreneurs
o Access to list of venture capitalist
o Access to list of business ideas and proposals
o Potential financing from EDBN
o Opportunity for members to be small time venture capitalists
B2B Dynamic Marketplace
The marketplace is a place where members can sell and buy physical products.
Members as individual, sole proprietor or limited company can offer various
products listed according to product categories such as automotive, toys, used
books, watches etc. EDBN will charge certain transaction commissions for
every successful transaction.
Business to Business (B2B) marketplace
o B2B tailored for local businesses
o B2B designed for local entrepreneurs with foreign buyers etc
B2C Online Shops
Business to Consumer (B2C) Online Shops
o Each member may operate online shops of their own
o Complete with shopping cart, payment facilities
o Free templates
Services Matching

This is where members can offer various services delivered through the
Internet. For example, some members may offer web-based software providing
online services such as:
Note: application in certain context refers to software developed typically for

business environment such as accounting software etc.
Compact Business Dashboard
Business Dashboard provides instant access to business information

in real time from one centralized location. Business owners will have
access to integrated suite of business applications such as Human
Resource, Sales & Customers Management
Business owners will be able to see all important business information

in real time from one centralized screen. Business Dashboard offers
an organized snapshot that summarizes real-time information in a user
friendly way. Such setup will save entrepreneurs from digging around
the details of something that they may need to know right then and
there. It offers ease in accessing important information to identify
trends, drill down into more specific information, generate graphs, and
more. Such capability will assist entrepreneurs in making informed
decisions when facing critical situations.
Virtual Office
Virtual office web-based application provides users with the ability to

manage the office activities as well as facilitate communication among
personnel. There are several modules inside the software including
project management, document management, mail client, calendaring
and task tracking.
Commercial Websites
SMEs have the option to have company websites with for very
competitive prices depending on the packages. The websites come
with several pre-defined templates allowing company websites be
setup quickly.

Accounting Software
For small monthly or annual fees, SMEs have the opportunity to use
online accounting software. This allows easy access for personnel
from anywhere to update the records as well as easy auditing when
comes to tax returns.
Customer Relations Management (CRM)
This software can be used by SMEs to manage customer

relationships. CRM application, delivers a feature-rich set of business
processes that enhance marketing effectiveness, drive sales
performance, improve customer satisfaction and provide executive
insight into business performance. Supported by integrated
collaboration and administration capabilities that may adapt to how any
company operates.
SMS Services
EDBN will provide the platform for members to launch new SMS
services. Even though this is an almost saturated business area,
creative members might come up with innovative services. Instead of
paying high price in to secure own mobile shortcode members have
the opportunity to use EDBN shortcode and launch their own content
for a fraction of owning own shortcode. Members may launch new
content like SMS games and mobile communities. These mobile
communities can be setup as their own community with own targeted
members such as motorist mobile club, commuter mobile club etc.
Other entrepreneurs could be offering online consultation services such as

business law consultation, company secretary, psychology and financial
planning.
CSR Community Service

In the spirit of a community and social service, community services are

encouraged among members. Sub-group within the communities are
encourage to volunteer to help local communities as well as own members.
Volunteers could also be offering own free coaching and mentoring for
members in entrepreneurship as well as other useful skills. Such activities can
be held in city and town community centers setup under strategic alliance
arrangement with local governments such as municipal council, JKKK and
others.
6.2. COMPETITION
There is no known exact copy cat of what EDBN has to offer. Nevertheless,
there are several known local and international existing organizations that
partially provide some of the services offered by EDBN. Locally, political parties
tie to certain racial group is known to setup their own entrepreneurs support
mechanism through their branches. These organizations typically offer fairly
basic website for members to browse and communicate with fellow members.
Around the world, countries have initiatives as part of systematic effort to

encourage and support SMEs development realizing that SMEs are very crucial
for the economies. These regionalized initiatives are normally designed for
localized target market segments. As such, they do not seem appealing to
Malaysians as well as ASEAN countries. South Korea and Australia are two
known countries with fairly developed ICT support for SMEs.
Australia has Dynamic Small Business Network (DSBN) described on its

www.dsbn.com.au portal as a one-stop resource addressing the essential
needs of small business. DSBN is a dynamic national network that saves you
money, time and provides momentum to grow your business. It has been
developed to the point of having its own banking division.
South Korea has Kotra Global B2B e-Trade Service described in its
www.buykorea.org as a government platform allowing one on one online
conferencing with qualified Korean exporters. It provides mechanism for easy

settlement of transactions with an international credit card through payment

service called KOPS. And, complete online E-contract services including
performance bond and advance payment bond with Korean exporters.
6.3. REVENUE MODEL
Since the community is about sharing user generated contents and providing
platform for members to offer services, the source of revenue for EDBN is
rather unconventional. In the context of this business plan, EDBN can earn
revenues from the following sources:
Primary
Membership fees at RM30 per year
Venture capital matching service fees at RM1000 for every

successful matching
B2B transaction commissions at RM2 each
Premier online shops for members at RM10 each
Tip jar system
Third party transaction fees (where applicable) at RM2 each
Strategic alliance with Government bodies
Secondary
Publishing & Convention
Sponsorships & Advertising
Consulting services
Printed books and magazines
Each of the services offered shall be provided by community members to other

community members. EDBN shall receive commissions out of each
transactions made by community members. The commissions receive out of

thousands, if not millions, of transactions constitute handsome revenues for

EDBN.
Another revenue channel is the B2B marketplace. It follows an online bazaar

concept similar to e-Bay. The different is B2B marketplace is not on auction
model but fix price model. EDBN will obtain revenue from entry fees paid by
seller as well as commissions from each successful transaction.
Meanwhile, strategic alliance with government agencies and non-government

organization will be explored. Possible alliances include MARA, MeCD, Bank
Negara and commercial for possible business financing options for members.
Also, alliance will be made with social agencies like Jabatan Kemajuan Islam
and Pusat Zakat Negeri in assisting qualified entrepreneurs such as new
converts.
6.4. OUTSOURCING
EDBN will focus in building and maintaining an online community. Our focus
will be building and maintaining infrastructure to provide enabling environment
for members to share contents, discuss, learn and communicate. Wherever
possible, outsourcing to competent members of the community is preferred in
delivering value-added services to community members. Services like
corporate websites, online payment service, business software, delivery and
logistic services will be sourced from reliable providers preferably among
community members.
In the case of SMS services, reliable technology provider will be sourced to

maintain and launch new services requested by community members. Each
new SMS service applied by community members must go through verification
and authorization process to ensure the service does not violate any
community policy.
Publishing and convention management is provided with strategic alliance with

professional events management companies as well as capable members of
EDBN community.

6.5. FUTURE PRODUCTS & SERVICES
Future products and services consist of any suitable services that may be
offered by community members as well as third party organizations. Suitable
means the entities must have the capacity to provide reliable world class
services. These include but not limited to:
Loan facilities offered by banks.
Miscellaneous business software accessible through the Internet:
o Human Resource Management
o Production & Distribution Management.
New services offered through SMS:
o Membership sign-up.
o Ring tones.
Payment facilities for import and export transactions

7. MARKETING & SALES
7.1. MARKET SEGMENTATION
EDBN members will be targeted from various segments of individual who are
interested in entrepreneurship as well as entrepreneurs running small and
medium enterprises. Each category constitutes a number of sub-segments.
They are:
Individuals
o Students
o Unemployed
o Self-employed
o Professionals
o Retirees
o Property owner
Small & Medium Enterprises
o Sole proprietorship
o Partnership
o Private limited company
7.2. MARKETING STRATEGY
Overall marketing strategy will be to create an image vibrant community with

many useful resources and activities for entrepreneurs. Any marketing medium
must highlight the privileges of being a member:
o Entrepreneurs can expect to meet others that share common interest in

entrepreneurship. Members can share contents, ideas, thoughts etc.
o Entrepreneurs have the options to find the suitable partners in their new
ventures as well finding potential financier.
o New members can expect to acquire skills and knowledge to be
successful entrepreneurs.

o Many online and offline workshop and seminars are available for
members throughout the year.
o Entrepreneurs can offer and consume services through service matching
service.
o Members can market their products through the B2B marketplace for
local and foreign organizations.
o Entrepreneurs can sell and buy products through online shops run by
members.
As part of the strategy, the memberships should be by invitation only by fellow

entrepreneurs. Invitation should be to individuals with genuine interest in
entrepreneurship and willingness to share with community members. There will
be rules of conduct and terms of service that members have to abide. Those
that may acted otherwise might be revoked their memberships.
By invitation was chosen simply the same reason as why Gmail was offered by
invitation only in its early years. Being invited creates the notion that being a
member means being accepted in an elite and privileged group within society.
Only existing members can invite other members.
Nevertheless, EDBN strategic alliances have the option to mass invite their pre-
selected individuals. Invitation can also be given on the spot for those that visit
the EDBN offices provided that their myKad is verified.
Experiential marketing will be the chosen marketing programs. According to

Davis Silver in his Smart Start-Ups book, experiential marketing is the best way
to launch new product or service. In this case, competition such as logo design,
treasure hunt should be held to promote EDBN community (Silver, 2007).
Strategic partnerships with government authorities like MARA and MECD are
part of the marketing strategy. Sponsorship from government authorities
provides free access to entrepreneurs within their care. These government
authorities could also provide funding for certain activities like training and
seminars.

As part of the strategy to build the trust of new beginners, marketing are done
mostly through the Internet and words of mouth. No advertisement will be done
through conventional media of print media and television where the target
consumers are declining fast. In summary, the EDBN community will imitate the
community business model from the old age like Mary Kay and Tupperway.
EDBN entrepreneurs community differs in the additional ways its members
communicate the Internet and mobile phone.
7.2.1. Positioning Statement
EDBN Entrepreneur Community will be the best online entrepreneur

community suited for all groups including minority group like women and
rural entrepreneurs. Becoming a member means having access to
resources and platforms to start a business, market, operate and grow a
business.
Learning, communicating and sharing with fellow entrepreneurs expose

members to best proven practices in the business world. Members can get
advice and access business literatures on starting new ventures.
Ideally, EDBN portal will provide market highlights for members in the form
of newsletter, podcast or online updates. Members also have access to
latest software critical in operating their businesses effectively and
efficiently.
EDBN online community provides natural market for members to market

their products in order to expand their market shares. Entrepreneurs can
sell directly to fellow entrepreneurs as well getting them as resellers for
their respective locations.

7.2.2. Promotion strategy
The key strategy is to award members for generating content within the
community. The more members generate and share content and services,
the more attractive the community is. The spiral effect would attract many
more members.
Since members could be generating thousand of contents every month,

only the best among the best for each categories will be awarded. The
community itself will be the judge.
7.2.3. Marketing Programs
Inline with the marketing strategy, experiential marketing programs will be

organized through out the year. There should be at least one program
every month in order to get the momentum going. Some programs could
be repeated after few months with some modifications each time. The
programs include:
Highest voted user generated content
Treasure hunt
Business proposal competition
Lucky draws
Member of the Month award
Each of the programs will come with reasonable attractive prices.
7.3. Sales Strategy
Sales strategy will be directly linked to marketing programs. Competent sales

support force will ensure high growth of members in the individual, SOHO and
company market segment.

7.3.1. Sales Forecast
Forecasted unit sales and revenue for the first year are shown in Figure 1
and Table 1. The forecast is based on a 20% exponential increase of
products sold every month for each of the three types produced. It is
expected that as marketing programs take momentum the forecast figures
will be within reach.
It is assumed that the first month of operations starts after R&D and the
required equipments have been acquired.

8. OPERATION
Most of customers interactions will go through the portal web pages designed
to be user friendly and accessible 24/7. The following are steps involved in
typical transactions conducted by members.
Signing-up
Members can only be invited by existing members in order to create a positive
impression of being privileged community members. Once invited through
email, invitees can register online to create membership username and
password. Members can try it out for free for one month. Once they decided to
become premier members, the charges are RM30 per year. The figure is
equivalent to RM2.50 a month. Much less than a single annual membership
fees of a typical gold credit card.
Rewarding Best Contents

Members contributing contents like e-books, videos and articles may decide to
charge the contents. In such cases, the collections will be shared between the
author and EDBN on 70 to 30 split.
Also, fellow members are welcome to voluntarily reward the authors who have
contributed great materials. If many members agree to reward the authors, a
large sum of money can be collected. Such reward to great authors will
encourage him to create more contents in the future. This community rewarding
system is called tip-jar system. Again, content owner and EDBN will share a 70
to 30 split respectively.
Matching Financier & Entrepreneurs

Provided that all the legal regulations are followed, members may submit
summary of their business proposal as well as the required equity capital.
Fellow members can act as venture capitalist and contribute small amount as
part of the capital requested for each proposal. Group of these small

contributors will act as if they are one single rich venture capitalist. There will a
limit of 50 allowed shareholders per business proposal based on the Company
Law limiting a Sendirian Berhad company to have only 50 shareholders. Only
once the required capital has been achieved, then the proposal will be
executed. EDBN will be responsible to hold the money contributed by
members. If the project could not acquire the required capital, the money will
be returned to the rightful owner. EDBN also could decide to contribute and
take up the shares in the business.
Once approved, members with considerable number of shares can nominate

their own representative (including themselves) on the board of the company.
For every successful business proposal capital sourcing, EDBN will take up 1%
out of the capital amount. Revenues from this source will also be reserved for
start-up fund. EDBN will use that fund to participate in financing suitable
business proposals.
Once approved, the fund will be deposited to the company to manage. A

community member will be elected to represent the community in the board.
EDBN will protect the minority shareholders interest and ensure good corporate
governance is practiced by the management.
As part of strategy to filter out fraudster, each business proposal owner is

required to come up with a minimum of 5% of the capital equity. He or she has
the option to take up loan from EDBN as well as other organizations for that
purpose.
B2B Marketplace Transactions

As described earlier, the marketplace is specifically designed to provide
enabling environment to assist local companies to trade with foreign buyers.
Local companies may participate to showcase their products in online product
catalogue. Foreign buyers may participate allowing them to browse the
catalogue, view 3-D images, videos and communicate with sellers.

With possible integration with banks, the platform could evolve to provide faster
and better payment mechanism for import and export trading. It is possible to
improve import and export mechanism through trusted intermediary party such
as EDBN. For every successful transaction, EDBN will charge 1% out of the
total transaction value.
B2C Online Shops

Members have the privilege to setup basic online shops for free. Each shop will
allow members to sell unlimited number of products complete with simple
payment options such as paypal and direct payment.
Members have the option to upgrade to premier account where the online
stores have much better features such as credit card payment option,
automatic store online marketing etc. Premier account will be charged at
minimal fees of RM19.90 per month.
Using Third Parties Services

Members have the privilege to use numerous business services offered by third
parties including fellow members. All services are entrepreneurship-related in
nature and are supposed to assist members in their businesses activities.
EDBN member will have special discount which ensures their transparency
when using the services. In return the service provider will contribute back to
EDBN certain agreed value percentage out of every successful transaction.
For example, in the case of SMS services, the mobile short code owner and
SMS operator will receive substantial cost savings compared to owning their
own short code number.

9. MANAGEMENT
9.1. Organizational Structure
Board of Directors
Managing Director Finance Manager

Executives
Technical Support Sales & Marketing

Unit Manager Unit Manager Unit Manager
Analysts
Programmer Analysts
Marketing Execs
System Engineers Support Engineers
Sales Exec
Web Designers Consultants
Consultants
9.2. Management Team
Faizal Yusof
Faizal Yusof is an experienced manager having managed multi-million Ringgit
projects with the Malaysian Government. Faizal has more than 9 year working
experience in various technical and management roles. Most recently, he spent
several years with DRB-HICOM as part of technical consulting unit for the
government sector. He holds an Electrical Engineering Degree from
Northwestern University in the United States, completed his study in 1998 fully
sponsored under government scholarship. He is currently completing his MBA
at International Business School (IBS), Universiti Teknologi Malaysia.

Mohd Hisham Ismail

Hisham has extensive experience in systems and application developments for
13 years, utilizing some of the latest development methodologies and software
components. He is one of the forefront technical gurus in Open Source Java
technology for mission critical systems.
He has done research, designed, architected, and pioneered the usage of self
created software development framework extensively and has lead teams in
implementing mission critical systems for multinationals local and abroad.
Hisham has a Bachelor of Science in Electrical Engineering, major in Very
Large Scale Integrated (VLSI) Circuit and minor in Computer Engineering from
Purdue University, Indiana USA.
Asfani Musa
Asfani started his career in IT by becoming a trainer at a software training
company despite studying International Relations at Syracuse University, New
York. He has 11 years experience in IT with his last position being the Business
Consultant Manager at Accelteam Sdn Bhd and subsequently, the General
Manager at AgroAccel Sdn Bhd, a joint venture between AgroScience Sdn Bhd
and Accelteam Sdn Bhd. The tenure at Accelteam has provided him extensive
exposure in the area of Corporate Performance Management (CPM).
Traditionally, CPM has been the domain of IT consultants and marketing
research specialists, who extract data, process it and deliver insight to an
executive-level decision maker. Today, organizations are retooling this
approach as CPM is transforming into a strategic enterprise application and
CPM has become an integral part of a process where companies gather,
manage and use information that will separate the winners from the losers.
Asfani has been very much involved in providing consultation services to
organizations that desire to reach and apply industrys best practices within
itself. Other tasks include developing the leaders in the organization while
overseeing the development of sales processes and key partnerships.

Panel Advisors
Business and technical advisors will be engaged to provide proper guidance for
this project. Several individuals have verbally agreed to participate including
Associate Professor Abdul Hamid of IBS, UTM.
9.3. Board of Directors
The management team above will be elected as directors. Additional non-

executive directors could be elected from the industry. As a bench mark, we
expect the board of directors to have a total of more than 50 years of combined
experience in technology-based business.
9.4. Personnel Plan
Monthly personnel cost estimates are included in the following table. All
employees will be hired on contract basis. The salaries are expected to remain
for the next three years. Annual bonuses might be awarded to employees
based on company financial performance.
Note: The figures are based on assumption that the number of staff will be sufficient to
cater for the demand. Additional employees and equipments might be requirement if
demand could not be met
Annual
Basic Salary
Qty (RM) Year 1 Qty Year 2 Qty Year 3
Salary
C-level officers & Directors 3 60,000.00 180,000.00 3 180,000.00 3 180,000.00
General Staff 1 18,000.00 18,000.00 1 18,000.00 1 18,000.00
Administrative executive 18,000.00 0.00 1 18,000.00 1 18,000.00
Accountant 36,000.00 0.00 1 36,000.00 1 36,000.00
Analyst 1 36,000.00 36,000.00 2 72,000.00 2 72,000.00
Technical Engineers 3 36,000.00 144,000.00 5 180,000.00 6 216,000.00
Total basic payroll 9 378,000.00 13 504,000.00 14 540,000.00
EPF 45,360.00 60,480.00 64,800.00
Medical & insurance 9,000.00 13,000.00 14,000.00
Total payroll 432,360.00 577,480.00 618,800.00
Table 9.4 Personnel Cost Estimates

10. FINANCIAL PLAN
This section describes the projected financial statements. Additional monthly

projected financial statements are available on the Appendix section.
10.1. START-UP COST
The following is the start-up cost for this new venture:

First 3 month start-up expenses
Start-up Expenses Cost Remarks
Portal Development 60,000.00 5 engineers
2 server in a fail-
Server Hardware 40,000.00 over architecture
Office setup with furniture 20,000.00
Marketing Campaign 15,000.00
Pre-start-up rent and deposits 6,000.00
Pre-start-up utilities and miscellaneous supplies 6,000.00
Company formation 3,500.00
Total 150,500.00
Table 10.1 First 3 month Start-up Expenses
10.2. OPERATING BUDGET
Once the portal is ready, first year monthly operating budget will be as follows:
First year monthly operating budget
Expenses Cost Remarks
Salaries and wages 32,670.00
Advertising 5,000.00
Premise Rental 1,000.00
Office supplies 1,000.00
Utilities 1,000.00
Insurance 1,000.00
Telephone 1,000.00
Travel expenses 1,500.00
Depreciation 2,000.00
Sales taxes 0.00
Interest 0.00
Miscellaneous (G&A) 2,000.00
Total 48,170.00
Table 10.2 Operating Budgets

10.3. PRO FORMA PROFIT & LOSS (INCOME STATEMENT)
Pro Forma Profit and Loss (RM000)

Year 1 Year 2 Year 3
Sales 846.34 3,701.56 16,657.34
Less: COGS 12.00 12.00 12.00
Gross profit 834.34 3,689.56 16,645.34
Operation expenses
Salaries and
wages 392.04 577.48 699.44
Advertising 197.90 1,470.43 10,925.43
Premise Rental 12.00 24.00 36.00
Office supplies 12.00 24.00 36.00
Utilities 12.00 24.00 36.00
Insurance 12.00 24.00 36.00
Telephone 12.00 24.00 36.00
Travel expenses 18.00 60.00 120.00
Depreciation 24.00 16.00 0.00
Taxes 42.32 185.08 832.87
Interest 0.00 0.00 0.00
Miscellaneous 24.00 60.00 120.00
Total operating expenses 758.26 2,488.99 12,877.74
Profit (loss) before taxes 76.08 1,200.57 3,767.60
Taxes 22.82 360.17 1,130.28
Net profit (loss) 53.25 840.40 2,637.32
Table 10.3 Income Statement
Note: Year 1 monthly income statement is available in APPENDIX A.

10.4. PRO FORMA CASH FLOW
Pro Forma Cash Flow Statement

Receipts
Membership Registration 542.23 2,555.62 8,874.50
New Venture Matching 213.84 671.13 2,297.78
B2B Transactions 42.77 51.32 175.71
Online Shop Setup 39.58 352.90 4,680.04
Third Party Service 7.92 70.58 629.31
Total Revenue (RM) 846.34 3,701.56 16,657.34
Disbursement
R&D 0.00 0.00 0.00
Equipment 0.00 0.00 0.00
Cost of goods sold 12.00 12.00 12.00
Salaries and wages 392.04 577.48 699.44
Advertising 197.90 1,470.43 10,925.43
Premise Rental 12.00 24.00 36.00
Office supplies 12.00 24.00 36.00
Utilities 12.00 24.00 36.00
Insurance 12.00 24.00 36.00
Telephone 12.00 24.00 36.00
Travel expenses 18.00 60.00 120.00
Depreciation 0.00 0.00 0.00
Sales Taxes 42.32 185.08 832.87
Interest 0.00 0.00 0.00
Miscellaneous 24.00 60.00 120.00
Total disbursement 746.26 2,484.99 12,889.74
Cash flow 100.08 1,216.57 3,767.60
Beginning balance 200.00 300.08 1,516.65
Ending balance 300.08 1,516.65 5,284.25
Table 10.4 Cash Flow
Note: Year 1 monthly cash flow is available in APPENDIX A.

10.5. PRO FORMA BALANCE SHEET
Pro Forma Balance Sheet (in RM000)

Assets
Current Assets
Cash 182.05 991.60 2,777.32
Accounts receivable 78.02 424.97 1,190.28
Inventory 0.00 0.00 0.00
Other short term
Total current assets 260.08 1,416.57 3,967.60
Long-term Asset
Equipment 40.00 0.00 0.00
Less depreciation 24.00 16.00 0.00
Total Long-term Assets 16.00 (16.00) 0.00
Total Assets 276.08 1,400.57 3,967.60
Liabilities and Owners' Equity

Current liabilities
Account payable 0.00 0.00 0.00
Other short-term liabilities 55.47 360.17 1,130.28
Total Current Liabilities 55.47 360.17 1,130.28
Long-term Liabilities
Vehicle loan 0.00 0.00 0.00
Total long-term Liabilities 0.00 0.00 0.00
Owner's equity
Venture capital 190.00 190.00 190.00
Faizal Yusof capital 2.50 2.50 2.50
Hisham capital 2.50 2.50 2.50
Asfani capital 2.50 2.50 2.50
Others 2.50 2.50 2.50
Retained earnings 20.61 840.40 2,637.32
Total owner's equity 220.61 1,040.40 2,837.32
Total liabilities and owner's
equity 276.08 1,400.57 3,967.60
Table 10.5 Balance Sheet

10.6. BREAK-EVEN ANALYSIS
There are three different types of product. As a result, few assumptions

have to be made in order to calculate the breakeven.
From PNL, Total Fixed Cost = RM 753,543.99
Product Sales to Product Weighted

Total Sales Ratio Contribution Average
(mix) Margin Ratio Ratio
Membership Registration (100
unit) RM3000/RM9000 25/30 0.311111111
New Venture Matching (1 unit) RM1000/RM9000 1 0.111111111
B2B Transactions (1000 unit) RM2000/RM9000 1 0.222222222
Online Shop Setup (100 unit) RM1000/RM9000 8/10 0.088888889
Third Party Service (1000 unit) RM2000/RM9000 1 0.222222222
0.955555556
Table 10.6a Contribution Margin Ratio
Break even point = RM 753,543.99 / 0.9555

= RM 788638.3987
Breaking up the units into different products based on the projected

sales:
Default Breakeven Breakeven Breakeven

Price unit Point (RM) Point Units
Membership Registration (100
unit) 3000 100 245339.904 81.7800 8,178.00
New Venture Matching (1 unit) 1000 1 87621.3942 87.6214 87.62
B2B Transactions (1000 unit) 2000 1000 175242.788 87.6214 87,621.39
Online Shop Setup (100 unit) 1000 100 70097.1153 70.0971 7,009.71
Third Party Service (1000 unit) 2000 1000 175242.788 87.6214 87,621.39
Table 10.6b Breakeven Units

10.7. RATIOS ANALYSIS
Year Year
Unit 1 2 Year 3 Remarks
RM
Sales 000 39.58 352.90 4,680.04
Sales growth % - 791.61 1,226.15
Current Assets Year 1 Year 2 Year 3

Cash % 65.94 70.80 70.00
Accounts receivable % 28.26 30.34 30.00
Inventory % 0.00 0.00 0.00
Other short term % 0.00 0.00 0.00
Total current assets % 94.20 101.14 100.00
Total Long-term Assets % 5.80 (1.14) 0.00
Total Assets % 100.00 100.00 100.00
Total Current Liabilities % 0.00 25.72 29.33
Total long-term Liabilities % 0.00 0.00 0.00
Retained earnings % 7.46 60.00 68.44
Percent of Sales Year 1 Year 2 Year 3

Sales % 100.00 100.00 100.00
Gross margin % 98.58 99.68 99.93
Salary and wages % 46.32 15.60 4.20
Advertising Expenses % 23.38 39.72 35.44
Profit Before Interest and Very high profit margin
Taxes % 8.99 32.43 52.77 indicating good business
Ratios Year 1 Year 2 Year 3

Very high - current asset
should be used more for
Current Unit - 3.93 3.41 expansion
Very high - current asset
should be used more for
Quick Unit 4.69 3.93 3.41 expansion
Total Debt to Total Asset % 0.00 0.00 0.00
Pre-tax return on net worth % 9.34 80.78 96.85
Pre-tax return on asset % 7.46 60.00 68.44
Table 10.7 Ratios Analysis

11. REFERENCES
Mohd Aris, Normah (2006). "SMEs: Building Block for Economic Growth."
Kuala Lumpur.
Cialdini, Robert (2006). The Psychology of Persuasion. New York.
Kim, W. Chan /Mauborgne, Renee (2005). Blue Ocean Strategy. Harvard

Business School Press. Boston, Massachusetts.
Silver, David (2007). Smart Start-Ups. Piatkus Books Ltd, London.
Defining SMEs Bank Negara Malaysia 2007 <http://www.smeinfo.com.my>
Bank Negara Malaysia. (2006). National SME Development Council Reports.

Kuala Lumpur.

12. APPENDIX A
YEAR 1 Profit & Loss (Income Statement)
Month Month Month

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 10 11 12 Total
Unit sales
Membership Registration 3,138.43 3,452.27 3,797.50 4,177.25 4,594.97 5,054.47 5,559.92 6,115.91 6,727.50 7,400.25 8,140.27 8,954.30 67,113.04
New Venture Matching 31.38 34.52 37.97 41.77 45.95 50.54 55.60 61.16 67.27 74.00 81.40 89.54 671.13
B2B Transactions 1,200.00 1,320.00 1,452.00 1,597.20 1,756.92 1,932.61 2,125.87 2,338.46 2,572.31 2,829.54 3,112.49 3,423.74 25,661.14
Online Shop Setup 891.61 1,069.93 1,283.92 1,540.70 1,848.84 2,218.61 2,662.33 3,194.80 3,833.76 4,600.51 5,520.61 6,624.74 35,290.37
Third Party Service 891.61 1,069.93 1,283.92 1,540.70 1,848.84 2,218.61 2,662.33 3,194.80 3,833.76 4,600.51 5,520.61 6,624.74 35,290.37
Total Sales 6,153.03 6,946.66 7,855.31 8,897.62 10,095.53 11,474.85 13,066.06 14,905.13 17,034.60 19,504.81 22,375.40 25,717.06 164,026.06
Revenue
Membership Registration 94,152.85 103,568.14 113,924.95 165,247.45 181,772.19 199,949.41 219,944.35 241,938.78 266,132.66 292,745.93 322,020.52 354,222.57 2,555,619.80
New Venture Matching 31,384.28 34,522.71 37,974.98 41,772.48 45,949.73 50,544.70 55,599.17 61,159.09 67,275.00 74,002.50 81,402.75 89,543.02 671,130.43
B2B Transactions 2,400.00 2,640.00 2,904.00 3,194.40 3,513.84 3,865.22 4,251.75 4,676.92 5,144.61 5,659.07 6,224.98 6,847.48 51,322.28
Online Shop Setup 8,916.10 10,699.32 12,839.18 15,407.02 18,488.43 22,186.11 26,623.33 31,948.00 38,337.60 46,005.12 55,206.14 66,247.37 352,903.73
Third Party Service 1,783.22 2,139.86 2,567.84 3,081.40 3,697.69 4,437.22 5,324.67 6,389.60 7,667.52 9,201.02 11,041.23 13,249.47 70,580.75
Total Revenue 138,636.46 153,570.03 170,210.96 228,702.75 253,421.87 280,982.67 311,743.27 346,112.40 384,557.40 427,613.65 475,895.63 530,109.93 3,701,556.99
Cost of goods sold
Internet & website 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Total cost of goods sold 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Gross profit 137,636.46 152,570.03 169,210.96 227,702.75 252,421.87 279,982.67 310,743.27 345,112.40 383,557.40 426,613.65 474,895.63 529,109.93 3,689,556.99
Operating Expenses
Salaries and wages 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 577,476.00
Advertising 37,150.42 44,580.50 53,496.60 64,195.92 77,035.11 92,442.13 110,930.56 133,116.67 159,740.00 191,688.00 230,025.60 276,030.72 1,470,432.22
Premise Rental 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Office supplies 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Utilities 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Insurance 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Telephone 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Travel expenses 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 60,000.00
Depreciation 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 0.00 0.00 0.00 0.00 16,000.00
Sales taxes 6,931.82 7,678.50 8,510.55 11,435.14 12,671.09 14,049.13 15,587.16 17,305.62 19,227.87 21,380.68 23,794.78 26,505.50 185,077.85
Interest 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Miscellaneous (G&A) 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 60,000.00

Total Operating Expenses 114,205.24 122,382.00 132,130.15 145,754.06 159,829.20 176,614.26 196,640.72 220,545.29 247,090.87 281,191.68 321,943.38 370,659.22 2,488,986.07
Profit (loss) before taxes 23,431.21 30,188.03 37,080.80 81,948.69 92,592.67 103,368.41 114,102.55 124,567.11 136,466.53 145,421.96 152,952.25 158,450.71 1,200,570.92
Taxes 7,029.36 9,056.41 11,124.24 24,584.61 27,777.80 31,010.52 34,230.77 37,370.13 40,939.96 43,626.59 45,885.67 47,535.21 360,171.28
Net profit (loss) 16,401.85 21,131.62 25,956.56 57,364.08 64,814.87 72,357.88 79,871.79 87,196.98 95,526.57 101,795.38 107,066.57 110,915.50 840,399.64
Table Appendix A Year 1 Profit & Loss (Income Statement)


Month Month Month
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 10 11 12 Total
Unit sales
New Venture Matching 31.38 34.52 37.97 41.77 45.95 50.54 55.60 61.16 67.27 74.00 81.40 89.54 671.13
B2B Transactions 1,200.00 1,320.00 1,452.00 1,597.20 1,756.92 1,932.61 2,125.87 2,338.46 2,572.31 2,829.54 3,112.49 3,423.74 25,661.14
Online Shop Setup 891.61 1,069.93 1,283.92 1,540.70 1,848.84 2,218.61 2,662.33 3,194.80 3,833.76 4,600.51 5,520.61 6,624.74 35,290.37
Third Party Service 891.61 1,069.93 1,283.92 1,540.70 1,848.84 2,218.61 2,662.33 3,194.80 3,833.76 4,600.51 5,520.61 6,624.74 35,290.37
Total Sales 6,153.03 6,946.66 7,855.31 8,897.62 10,095.53 11,474.85 13,066.06 14,905.13 17,034.60 19,504.81 22,375.40 25,717.06 164,026.06
Revenue
Membership Registration 94,152.85 103,568.14 113,924.95 165,247.45 181,772.19 199,949.41 219,944.35 241,938.78 266,132.66 292,745.93 322,020.52 354,222.57 2,555,619.80
B2B Transactions 2,400.00 2,640.00 2,904.00 3,194.40 3,513.84 3,865.22 4,251.75 4,676.92 5,144.61 5,659.07 6,224.98 6,847.48 51,322.28
Total Revenue 138,636.46 153,570.03 170,210.96 228,702.75 253,421.87 280,982.67 311,743.27 346,112.40 384,557.40 427,613.65 475,895.63 530,109.93 3,701,556.99
Cost of goods sold
Gross profit 137,636.46 152,570.03 169,210.96 227,702.75 252,421.87 279,982.67 310,743.27 345,112.40 383,557.40 426,613.65 474,895.63 529,109.93 3,689,556.99
Operating Expenses
Advertising 37,150.42 44,580.50 53,496.60 64,195.92 77,035.11 92,442.13 110,930.56 133,116.67 159,740.00 191,688.00 230,025.60 276,030.72 1,470,432.22
Premise Rental 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Office supplies 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Utilities 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Insurance 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Telephone 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Travel expenses 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 60,000.00
Depreciation 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 0.00 0.00 0.00 0.00 16,000.00
Sales taxes 6,931.82 7,678.50 8,510.55 11,435.14 12,671.09 14,049.13 15,587.16 17,305.62 19,227.87 21,380.68 23,794.78 26,505.50 185,077.85
Interest 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total Operating Expenses 114,205.24 122,382.00 132,130.15 145,754.06 159,829.20 176,614.26 196,640.72 220,545.29 247,090.87 281,191.68 321,943.38 370,659.22 2,488,986.07

Taxes 7,029.36 9,056.41 11,124.24 24,584.61 27,777.80 31,010.52 34,230.77 37,370.13 40,939.96 43,626.59 45,885.67 47,535.21 360,171.28
Net profit (loss) 16,401.85 21,131.62 25,956.56 57,364.08 64,814.87 72,357.88 79,871.79 87,196.98 95,526.57 101,795.38 107,066.57 110,915.50 840,399.64

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Total
Unit sales
New Venture Matching 107.45 118.20 130.02 143.02 157.32 173.05 190.36 209.39 230.33 253.37 278.70 306.57 2,297.78
B2B Transactions 4,108.49 4,519.34 4,971.27 5,468.40 6,015.24 6,616.76 7,278.44 8,006.28 8,806.91 9,687.60 10,656.36 11,722.00 87,857.07
Total Sales 29,965.04 34,551.48 39,914.56 46,195.52 53,562.48 62,215.62 72,393.46 84,380.33 98,515.40 115,203.37 134,927.44 158,264.65 930,089.36
Revenue
Membership Registration 389,644.83 428,609.31 471,470.25 558,547.27 614,402.00 675,842.20 743,426.42 817,769.06 899,545.97 989,500.56 1,088,450.62 1,197,295.68 8,874,504.16
New Venture Matching 107,451.63 118,196.79 130,016.47 143,018.12 157,319.93 173,051.92 190,357.12 209,392.83 230,332.11 253,365.32 278,701.85 306,572.04 2,297,776.13
B2B Transactions 8,216.98 9,038.67 9,942.54 10,936.80 12,030.47 13,233.52 14,556.87 16,012.56 17,613.82 19,375.20 21,312.72 23,443.99 175,714.15
Online Shop Setup 79,496.85 143,094.32 171,713.19 206,055.83 247,266.99 296,720.39 356,064.47 427,277.36 512,732.84 615,279.41 738,335.29 886,002.34 4,680,039.28
Total Revenue 600,709.65 718,018.35 806,037.54 946,032.12 1,063,988.33 1,198,410.75 1,351,880.14 1,527,422.13 1,728,589.11 1,959,557.74 2,225,245.18 2,531,447.70 16,657,338.75
Cost of goods sold
Gross profit 599,709.65 717,018.35 805,037.54 945,032.12 1,062,988.33 1,197,410.75 1,350,880.14 1,526,422.13 1,727,589.11 1,958,557.74 2,224,245.18 2,530,447.70 16,645,338.75
Operating Expenses
Advertising 276,030.72 331,236.86 397,484.24 476,981.08 572,377.30 686,852.76 824,223.31 989,067.97 1,186,881.57 1,424,257.88 1,709,109.46 2,050,931.35 10,925,434.51
Premise Rental 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Office supplies 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Utilities 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Insurance 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Telephone 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Travel expenses 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 120,000.00
Depreciation 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Sales taxes 30,035.48 35,900.92 40,301.88 47,301.61 53,199.42 59,920.54 67,594.01 76,371.11 86,429.46 97,977.89 111,262.26 126,572.38 832,866.94
Interest 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total Operating Expenses 399,352.87 460,424.45 531,072.78 617,569.36 718,863.39 840,059.97 985,103.99 1,158,725.75 1,366,597.69 1,615,522.44 1,913,658.39 2,270,790.41 12,877,741.49

Taxes 60,107.03 76,978.17 82,189.43 98,238.83 103,237.48 107,205.24 109,732.85 110,308.91 108,297.42 102,910.59 93,176.04 77,897.19 1,130,279.18
Net profit (loss) 140,249.75 179,615.73 191,775.33 229,223.93 240,887.46 250,145.55 256,043.31 257,387.46 252,693.99 240,124.71 217,410.76 181,760.11 2,637,318.08

YEAR 1 PRO FORMA CASH FLOW
Pre-start- Month Month Month

up Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 10 11 12 Total
Receipts
Membership
Registration 0.00 0.00 0.00 39,930.00 43,923.00 48,315.30 53,146.83 58,461.51 64,307.66 70,738.43 77,812.27 85,593.50 542,228.51
B2B Transactions 2,000.00 2,200.00 2,420.00 2,662.00 2,928.20 3,221.02 3,543.12 3,897.43 4,287.18 4,715.90 5,187.48 5,706.23 42,768.57
Third Party Service 200.00 240.00 288.00 345.60 414.72 497.66 597.20 716.64 859.96 1,031.96 1,238.35 1,486.02 7,916.10
Total revenue 13,200.00 14,640.00 16,248.00 57,975.60 63,980.52 70,627.40 77,988.74 86,145.94 95,190.51 105,225.54 116,367.27 128,747.00 846,336.52
Disbursement 0.00
R&D 60,000.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Equipment 40,000.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Cost of goods sold 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Advertising 15,000.00 5,000.00 6,000.00 7,200.00 8,640.00 10,368.00 12,441.60 14,929.92 17,915.90 21,499.08 25,798.90 30,958.68 37,150.42 197,902.51
Premise Rental 6,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Office supplies 20,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Utilities 3,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Insurance 3,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Telephone 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Travel expenses 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 18,000.00
Depreciation 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Sales Taxes 660.00 732.00 812.40 2,898.78 3,199.03 3,531.37 3,899.44 4,307.30 4,759.53 5,261.28 5,818.36 6,437.35 42,316.83
Interest 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Miscellaneous 3,500.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 24,000.00
Total disbursement 150,500.00 47,830.00 48,902.00 50,182.40 53,708.78 55,737.03 58,142.97 60,999.36 64,393.20 68,428.61 73,230.18 78,947.05 85,757.77 746,259.34
Cash flow (150,500.00) (34,630.00) (34,262.00) (33,934.40) 4,266.82 8,243.49 12,484.43 16,989.39 21,752.73 26,761.90 31,995.36 37,420.22 42,989.23 100,077.18

Beginning balance 200,000.00 49,500.00 14,870.00 (19,392.00) (53,326.40) (49,059.58) (40,816.09) (28,331.65) (11,342.27) 10,410.47 37,172.37 69,167.73 106,587.95 49,500.00
Ending balance 49,500.00 14,870.00 (19,392.00) (53,326.40) (49,059.58) (40,816.09) (28,331.65) (11,342.27) 10,410.47 37,172.37 69,167.73 106,587.95 149,577.18 149,577.18
Table Appendix A Year 1 Cash Flow


Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Receipts
Membership
Registration 94,152.85 103,568.14 113,924.95 165,247.45 181,772.19 199,949.41 219,944.35 241,938.78 266,132.66 292,745.93 322,020.52 354,222.57
New Venture Matching 31,384.28 34,522.71 37,974.98 41,772.48 45,949.73 50,544.70 55,599.17 61,159.09 67,275.00 74,002.50 81,402.75 89,543.02
B2B Transactions 2,400.00 2,640.00 2,904.00 3,194.40 3,513.84 3,865.22 4,251.75 4,676.92 5,144.61 5,659.07 6,224.98 6,847.48
Online Shop Setup 8,916.10 10,699.32 12,839.18 15,407.02 18,488.43 22,186.11 26,623.33 31,948.00 38,337.60 46,005.12 55,206.14 66,247.37
Third Party Service 1,783.22 2,139.86 2,567.84 3,081.40 3,697.69 4,437.22 5,324.67 6,389.60 7,667.52 9,201.02 11,041.23 13,249.47
Total revenue 138,636.46 153,570.03 170,210.96 228,702.75 253,421.87 280,982.67 311,743.27 346,112.40 384,557.40 427,613.65 475,895.63 530,109.93
Disbursement
R&D 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Equipment 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Cost of goods sold 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00
Salaries and wages 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00 48,123.00
Advertising 37,150.42 44,580.50 53,496.60 64,195.92 77,035.11 92,442.13 110,930.56 133,116.67 159,740.00 191,688.00 230,025.60 276,030.72
Premise Rental 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00
Office supplies 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00
Utilities 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00
Insurance 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00
Telephone 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00
Travel expenses 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00
Depreciation 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Sales Taxes 6,931.82 7,678.50 8,510.55 11,435.14 12,671.09 14,049.13 15,587.16 17,305.62 19,227.87 21,380.68 23,794.78 26,505.50
Interest 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Miscellaneous 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00 5,000.00
Total disbursement 113,205.24 121,382.00 131,130.15 144,754.06 158,829.20 175,614.26 195,640.72 219,545.29 248,090.87 282,191.68 322,943.38 371,659.22
Cash flow 25,431.21 32,188.03 39,080.80 83,948.69 94,592.67 105,368.41 116,102.55 126,567.11 136,466.53 145,421.96 152,952.25 158,450.71
Beginning balance 149,577.18 175,008.40 207,196.43 246,277.23 330,225.92 424,818.59 530,187.00 646,289.55 772,856.66 909,323.18 1,054,745.15 1,207,697.39

Ending balance 175,008.40 207,196.43 246,277.23 330,225.92 424,818.59 530,187.00 646,289.55 772,856.66 909,323.18 1,054,745.15 1,207,697.39 1,366,148.10


Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Total
Receipts
Membership
Registration 389,644.83 428,609.31 471,470.25 558,547.27 614,402.00 675,842.20 743,426.42 817,769.06 899,545.97 989,500.56 1,088,450.62 1,197,295.68 8,874,504.16
New Venture Matching 107,451.63 118,196.79 130,016.47 143,018.12 157,319.93 173,051.92 190,357.12 209,392.83 230,332.11 253,365.32 278,701.85 306,572.04 2,297,776.13
B2B Transactions 8,216.98 9,038.67 9,942.54 10,936.80 12,030.47 13,233.52 14,556.87 16,012.56 17,613.82 19,375.20 21,312.72 23,443.99 175,714.15
Online Shop Setup 79,496.85 143,094.32 171,713.19 206,055.83 247,266.99 296,720.39 356,064.47 427,277.36 512,732.84 615,279.41 738,335.29 886,002.34 4,680,039.28
Total revenue 600,709.65 718,018.35 806,037.54 946,032.12 1,063,988.33 1,198,410.75 1,351,880.14 1,527,422.13 1,728,589.11 1,959,557.74 2,225,245.18 2,531,447.70 16,657,338.75
Disbursement 0.00
R&D 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Equipment 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Cost of goods sold 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 12,000.00
Advertising 276,030.72 331,236.86 397,484.24 476,981.08 572,377.30 686,852.76 824,223.31 989,067.97 1,186,881.57 1,424,257.88 1,709,109.46 2,050,931.35 10,925,434.51
Premise Rental 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Office supplies 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Utilities 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Insurance 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Telephone 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00 36,000.00
Travel expenses 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 120,000.00
Depreciation 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Sales Taxes 30,035.48 35,900.92 40,301.88 47,301.61 53,199.42 59,920.54 67,594.01 76,371.11 86,429.46 97,977.89 111,262.26 126,572.38 832,866.94
Interest 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Miscellaneous 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00 120,000.00
Total disbursement 400,352.87 461,424.45 532,072.78 618,569.36 719,863.39 841,059.97 986,103.99 1,159,725.75 1,367,597.69 1,616,522.44 1,914,658.39 2,271,790.41 12,889,741.49
Cash flow 200,356.78 256,593.90 273,964.76 327,462.76 344,124.94 357,350.79 365,776.15 367,696.38 360,991.41 343,035.30 310,586.79 259,657.29 3,767,597.26

Beginning balance 1,366.15 201,722.93 458,316.83 732,281.59 1,059,744.35 1,403,869.29 1,761,220.08 2,126,996.23 2,494,692.61 2,855,684.02 3,198,719.32 3,509,306.12 1,366.15
Ending balance 201,722.93 458,316.83 732,281.59 1,059,744.35 1,403,869.29 1,761,220.08 2,126,996.23 2,494,692.61 2,855,684.02 3,198,719.32 3,509,306.12 3,768,963.41 3,768,963.41

13. APPENDIX B

14. APPENDIX C

Entrepreneurs Dynamic Business Network

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INTERNATIONAL BUSINESS SCHOOL

UNIVERSITI TEKNOLOGI MALAYSIA

Terms and Abbreviations

Term / Abbreviation Meaning

EDBNSB Entrepreneurs Dynamic Business Network Sdn Bhd

EDBN Entrepreneurs Dynamic Business Network

SME Small Medium Enterprise

PNL Profit & Loss / Income Statement

MARA Majlis Amanah Rakyat

MeCD Ministry of Entrepreneur and Cooperation

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9.4. P ERSONNEL P LAN .......................................................................................................... 39

List of Tables & Figures

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Online communities are manifestation of mankind unique characteristic as

In this business plan, we are proposing the development of unique business

Being a member comes with list of privileges including access to numerous

User generated entrepreneurship materials

Matching service between venture capitalist & entrepreneurs

Business to Business (B2B) marketplace

Business to Consumer (B2C) Online Shops

Access to business services offered by third parties or fellow members

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Based on our thorough analyses including market and financial, as captured in

2007 Created on 2007-09-13 Page 6 of 60

Entrepreneurs Dynamic Business Network Sdn Bhd will be a private-owned

EDBN is a membership-based community which provides members with list of

EDBN memberships are by invitation only. It will be appealing to existing

The development of EDBN Network is based on 3C, that is:

Connectivity to improve networking, productivity and competitiveness of

Communication among entrepreneurs as well as with government

Content as a platform for sharing user generated contents, information,

EDBN has four objectives:

Reduce gap in term of technology exploitation among entrepreneurs in

Provide interactive platform for members to share, discuss,

Provide e-commerce platform for Malaysian entrepreneurs trading with

2007 Created on 2007-09-13 Page 7 of 60

Assist in development of minority group entrepreneurs, i.e. rural

To provide enabling environment for entrepreneurs to share, communicate,

We are in business of building entrepreneur community with focus in building

3.3. START-UP SUMMARY

Start-up costs will be approximately RM 150,000.00 which will include

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3.4. DEVELOPMENT TO DATE

The management is in the process of securing capital from interested venture

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According to definition posted on National SME Development Council (NSDC)

SMEs in Malaysia account for 99.2 percent or 518,996 of total establishments

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4.2. NATIONAL AGENDA

In theory, entrepreneurs and SMEs provide excellent mechanism for

Second Industrial Master Plan

Third Outline Perspective Plan

Eighth Malaysia Plan (8MP)

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Ninth Malaysia Plan (9MP)

4.3. IMPORTANCE OF ICT

The current development in the business world as a result of technological

As recent as the year 2005, outsourcing is the trend among multinational

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also facilitate global connectivity transforming the mechanism of creating and

In order to survive the global business environment characterized by rapid

Even in vision 2020, which envisages a fully developed, knowledge rich