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V-ARC
Virtual Reality Arcade
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STRONG INVESTMENT OPPORTUNITY!

$12M
Invest $44M
For 14.4% of 5
Venture Equity
30% IRR in Years
260% growth
Value

Moat Growth Opportunities

Increasing trend of
First-Mover Scalable Business
Consumer Focused VR usage and
Advantage Model
competitive gaming
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YOUR CONTRIBUTION TO V-ARC

Locations Gaming and Equipment

Take our company abroad Most Updated VR games, Flat

to West Coast, Japan, screen monitors, surround

12 million Korea, and China sound systems, lounge chairs
dollars
invested in
V-ARC Marketing and Advertising Food and Drink Menu
Building VR brand, tapping into Optimize and customize
video game, restaurant, and bar menu according to location
and nightlife markets
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OUR SHARES FOR EVERYONE

Voting Rights Equity Ownership

Private Issue: Contribute to key Own part of our company and
corporate decisions in help us grow to our potential
Common success of company
Stock

Limited Liability No Preferred Shareholders

Lose up to only the price you You are our priority from
paid for the stock start to finish
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OUR CONDITIONS
Subject to restrictions on transferability and resale
Transfer and Resale
except as permitted under Rule 144A of the
Restrictions:
Securities Act of 1933

Equity Valuation Of Issuer $83.2M (post money)

1200 shares at $100/share for 14.4% of voting power

Amount of Offering
and Ownership.

Dividend payout rate 0%

Voting Rights One vote for each share of Series A Common Stock

Any decision to invest in Series A Common Stock should be made solely in reliance upon such Offering Memorandum after
conducting such investigations as the potential investor deems necessary, including consulting the potential investor’s own legal,
accounting and tax advisers.

WHAT IS V-ARC?
Private Rooms
10 Rooms with 2 VR
Company consoles, flat screens, and
lounge chairs in the rooms
Overview
Gaming Equipment Provided
● Headset
● Wireless controllers
● Movement sensor
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Pricing
Flat rate of a room per hour
split up between a group
Group Reservation
Rooms can be reserved
on our website for
groups or parties
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EXPERIENCE

Play Compete
● Over 100 VR ● Challenge
games your friends
● Full-wall game ● Compete with
projection gamers Socialize
Eat & Drink around the
● Enjoy the new
world
● Full service technology with
Bar and family and friends
Restaurant ● Have fun!
● Happy Hour
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Key Drivers
 ENTERTAINMENT MARKET SIZE 9

TAM:
1.8 % Growth Rate $1.45 billion

SAM:
$537 Million

SOM:
$100 Million
Year 5:5:$72
Year Million
$72M
THE VR MARKET 10
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GAME INNOVATION

● Millennials want the

newest and best
games

● We will implement
new VR games each
month to gain a
loyal customer base

● AR could be the
next step for V-ARC
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Moat and Competitive Position

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TOP COMPETITORS IN THE MARKET

D&BS TOP GOLF LUCKY STRIKE VR Junkies

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MOAT

● First to Hawaii and Mainland

01 First-Mover
● Combining Markets

● Rise in Augmented and Virtual

02 New Technology
Reality

● Large companies not focused

03 Consumer Focused on entertainment aspect of VR
● Provide direct to consumer
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Financial Analysis
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REVENUE GENERATION TIMELINE

2 New Locations in
New Location on Maui
Oregon and Nevada
with $6M Revenue per
V-ARC Opens on Oahu with $7M Revenue per
Location
$5M Revenue Y1 Location

2021
2019
2017
Invest
$5M of
our Own
Money 2018 2020 2022

New Location on Oahu 2 New Locations in International Locations

Revenue Source: California with $6M open in Japan and Korea
with $5M Revenue at
● VR Gaming Revenue per Location with Revenue at $8M per
each Location
● Food and Location
Non-Alcoholic
Drinks
● Alcohol
 OUR FIVE YEAR PROJECTIONS: 2017 -2022 17

COMPARABLE

INCOME STATEMENT STATEMENT OF CASH FLOWS

SALES: $5 → $72
FCF: $(3.09)→ $2
GPM: 70% → 60%
Year 2022 Positive
NPM: -11% → 22% Cash Position of $26

BALANCE SHEET AFN FINANCING

Leverage: 33% → 36% 50% Equity Long-Term Debt

50% Long-Term Debt
Liquidity: 3.21 → 2.82 vs .68 Asking for $12, which is AFN
industry avg requirement in year 2
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Valuation
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VALUATION: MULTIPLE METHODS

V-ARC

Financial
Dave & Busters Daiichi Kosho
Projections 2018 Sales*1.82 Sales*2.05

Sales 10.00 =19.17 =21.47 EV/Sales

23.4
Levered FCF -3.62

NI (Earnings) -0.12

EBITDA 0.50
Valuation
BV Debt 3.30
Round One IMAX
MV Debt 2.91 Sales*3.37
Sales*1.73
Cash B/S 3.88 =18.27 =34.67
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VALUATION: DCF MODEL

WACC: 7%
Est. Constant Growth Rate: 2.00%
VC Discount Rate: 30%

2018 2019 2020 2021 2022

$-0.30 $0.5 $4.05 $8.36 $18.28

92.97 - 3 + 4 = $93.55
EV (sum FCF + Current MKT Current Equity Value
Terminal Value PVs) Value of Debt Cash
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VALUATION: DISCOUNTED IPO MODEL
Net Income EBITDA EV/EBITDA P/E VC Disc Rate
16 27 12 22.0 30%
Investment
$12
EV/EBITDA: Percent of Venture
P/E: 50% Sold
50%
93 95 12.7%
FV Equity 2022
346 352
$349

Amount Given to Investor

94 $44
Weighted Average Equity Value
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WEIGHTED EQUITY VALUATION

15%
Multiple
Methods

$23.4 50%
Discounted FCF

35%
$83.16 $93.55
Valuation IPO

$94
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Risk Analysis
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SENSITIVITY ANALYSIS
How risky are
we?

Scenario Initial Inv Return Net Income

Projected 12 44 16

5% Decrease 12 34 12

10% Decrease 12 25 8

18% Decrease
(BE) 12 12 4
Projected 5% Dec 10% Dec Breakeven

266% 183% 108% 0%

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CONSUMER CONFIDENCE Impact → Low

Revenue Net Income

$536,272 $1,615

$533,358 $8,841

$459,792 $12,063

2007 2008 2009 2007 2008 2009

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SEASONALITY Impact → Low

Slow times and peak times based on season

Peak Peak

Slow
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D&B’s MARKET SHARE Impact → Moderate

Biggest player Scalability of operations

46% market share 111 locations

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HOME/MOBILE GAMING Impact → Moderate

Growing trend amongst

millennials

VR integration

(Samsung, Sony,

Microsoft, etc.)
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Low Low Moderate Moderate

Consumer D&B’s Home/Mobile
Seasonality
Confidence Market Share Gaming

● Provide consistent ● Attract customers ● Attack the part of ● Build loyal customer
value with events and the market D&B base
deals doesn’t control
● D&B’s performance ● Keep prices lower
during crisis shows ● Host monthly ● Differentiate by than owning VR
customers’ competitions incorporating
willingness to pay private party ● Invest in the
rooms experience
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Conclusion
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JOIN OUR INVESTMENT OPPORTUNITY
Invest
Let’s turn your $12M
$12 million
into 44 million For 14.4%
by investing in of Venture
V-ARC!!! Equity Value

$44M
5
in Years
260% growth
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EXIT STRATEGY

Purchased 3x Return Investment

Sell To Strategic Company D&B’s Themes
Purchased Received nearly Targeting

D&B’s for $570 3x return on investment

before IPO investment after opportunities with

Oak Hill Capital
Partners 4 years similar themes

V-ARC is virtual reality
arcade restaurant
In the next 5 years:
9 locations in Hawaii,
California, Oregon, Nevada,
Japan, Korea
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SUMMARY
Year 5 revenue up to $8 per
store $12 investment returns $44
in 5 years
Year 5:
Valued at $83.16
22% Net Profit Margin
Exit strategy to sell to Oak Hill
Steady leverage and High Capital Partners
Liquidity
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V-ARC
Virtual Reality Arcade