Funding Plan
Funding in support of the C3P (Customizable Credit Card Protection) project will be
requested from the National Science Foundation (NSF) under the SBIR grant program and from
CIT (Center for Innovative Technology) Commercial Giving Program Commercial Finance
Group. Total budgeted costs for the project are estimated at $624,434. Initial out years budget
costs are $128,544 and will increase by 20% for every 10 customers we acquire.
The SBIR program distributes funds in two distinct phases (Phases I and II) in the
amounts of up to $100,000 and $750,000, respectively. During Phase I, $120,045 will be needed
for the development of the C3P prototype. This development work will include planning,
identification of requirements, hardware setup, design, coding and testing. The SBIR program’s
funding limit of $100,000 for Phase I will only cover the first $100,000 of this phase. Additional
funding will be needed for Phase I from CIT Commercial Giving Commercial Finance Group,
and this will be in the amount that exceeds the $100,000, which is $20,045.
Upon successful implementation of a prototype, an additional $750,000 will be requested
from the NSF for Phase II work. This funding will cover ongoing development from Phase I,
additional hard resources, technical documentation and actual beta testing of the product with
users. Total costs for Phase II are budgeted at $375,844.
Having acquired the necessary funding in Phases I and II to complete the prototype, C3P
will be in a position to enter production and commercialization in Phase III. At this point, no
additional funds can be solicited through the SBIR program. In order to cover these costs,
funding will be sought through venture capital from outside investors. The major tasks for Phase
III include advertising and hiring office personnel. Total costs for Phase III are budgeted at
$128, 544. It is anticipated that after Phase III, C3P will have obtained the necessary investor
support and become a financially viable product.
In the out years, additional funds will be needed to cover the day to day operations
involved in maintaining and selling the product. Funds will also be used to support the
customers. These costs are budgeted at $128,544 initially/year. For each 10 customers we
attain, we will need to increase the out years budget by 20%.
Deadlines for submission of proposals to the SBIR program are December 4, 2006.
Work will begin shortly after approval and funding amounts have been awarded. There is no
deadline, though, for obtaining funds through CIT.
Each phase with funding and resource requirements is found below.
PHASE I BUDGET
Hard Resources
Product
TOTAL
Personnel Resources
Resource
Project Manager
Database Maintenance Team
Database Administrator
Technical Director
POS Terminal Programmers
Programmer III
Software Development Team
Web Developer
GUI Programmer
Programmer II
Risk Management Director
Documentation Specialist
Finance Director
TOTAL
TOTAL Resources
*Salary.com
# Units Cost/Unit Total
$0
#
1
Salary*
Overhead Hourly Hours Total
$75,616 $105,862
$55
260 $14,336
2
1
$73,252
$56,926
$102,553
$79,696
$53
$42
148
285
$15,810
$11,830
2
$57,397
$80,356
$42
44
$3,683
2
1
3
1
1
1
$52,920
$46,282
$45,368
$68,141
$35,751
$108,901
$74,088
$64,795
$63,515
$95,397
$50,051
$152,461
$39
$34
$33
$50
$26
$79
105
439
319
16
239
161
$8,103
$14,815
$31,658
$795
$6,230
$12,785
$120,045
$120,045
C3P does not acquire any hard resource costs during Phase I. We will be using ODU
resources such as the computers and facilities to conduct our business. Personnel costs include
both direct and indirect costs. Indirect costs are based on 40% overhead of direct personnel
costs, which cover general administrative costs, facility costs, marketing and ongoing research
and development. Specific hours and annual salary information for each personnel category with
supporting detail are also found in the budget.
PHASE II BUDGET
Hard Resources
Product
DELL PowerEdge 6800 Advanced
Windows Server 2003, Enterprise Ed.
PowerVault MD3000 Disk Storage Array
Microsoft Project Server
RFID Cards
Card Programmer
Card Printer
Domain Name Registrations
TOTAL
# Units Cost/Unit Total
3
$17,605
$52,815
5
$3,295
$16,475
1
$6,338
$6,338
3
$999
$2,997
10000
$0.52
$5,200
10
$64
$640
5
$2,000
$10,000
1
$15
$15
$94,480
Dell.com
InternetSolutions.com
http://www.maxking.com/shopcart/product.php?productid=16375$cat=249&page=1
http://www.maxking.com/shopcart/product.php?productid=16213
http://www.maxking.com/shopcart/product.php?productid=16282$cat=304&page=1
Personnel Resources
Resource
Project Manager
Database Maintenance Team
Database Administrator
Technical Director
POS Terminal Programmers
Programmer III
Software Maintenance & Installation Team
Web Developer
GUI Programmer
Programmer II
Risk Management Director
Documentation Specialist
Finance Director
TOTAL
TOTAL Resources
*Salary.com
#
1
Salary*
Overhead Hourly Hours Total
75,616
105,862
$55
403 $22,220
3
1
$73,252
$56,926
$102,553
$79,696
$53
$42
121
541
$19,442
$22,456
3
$57,397
$80,356
$42
160
$20,089
3
2
7
1
1
1
$52,920
$46,282
$45,368
$68,141
$35,751
$108,901
$74,088
$64,795
$63,515
$95,397
$50,051
$152,461
$39
$34
$33
$50
$26
$79
555
739
250
16
499
144
$64,248
$49,878
$57,792
$795
$13,008
$11,435
$281,364
$375,844
Unlike Phase I, in Phase II we will be acquiring hard resources. These are to include
database servers, server software, a disk storage array, Microsoft Project Server, RFID cards,
card programmers, card printers, and a domain registration fee for our website. During this
phase the Database Maintenance Team, POS Terminal Programmers, and Software Maintenance
& Installation Team have increased their staff from Phase I. We are hiring the extra personnel in
these areas because we want to focus on our software and database development. Also, we are
hoping that with the extra programmers, we will be able to automate administrative functions
that will prove to be useful during Phase III and our production out years.
PHASE III BUDGET INFORMATION
Hard Resources
Product
Domain Name Registrations
TOTAL
Personnel Resources
Personnel Resources
Project Manager
Database Maintenance Team
Database Administrator
Technical Director
POS Terminal Programmers
Programmer III
Software Maintenance & Installation
Team
Web Developer
Programmer II
Risk Management Director
Documentation Specialist
Finance Director
Marketing Director
C3P Rep (Vendors)
C3P Rep (Businesses)
Customer Support Team
Web Customer Support Specialist
Attorney II
TOTAL
TOTAL Resources
*Salary.com
# Units Cost/Unit Total
1
$15
#
1
$15
$15
Salary*
Overhead Hourly Hours Total
$75,616 $105,862
$55
257 $14,135
3
1
$73,252
$56,926
$102,553
$79,696
$53
$41
139
15
$22,048
$1,230
2
$57,397
$80,356
$41
208
$17,056
1
2
1
1
1
1
1
1
$52,920
$45,368
$68,141
$35,751
$108,901
$95,703
$25,944
$25,944
$74,088
$63,515
$95,397
$50,051
$152,461
$133,984
$36,322
$36,322
$38
$33
$49
$26
$79
$69
$18
$18
200
208
32
35
144
425
107
107
$7,600
$13,728
$1,568
$910
$11,376
$29,325
$1,926
$1,926
3
1
$41,014
$76,844
$57,420
$107,582
$29
$56
139
30
$4,021
$1,680
$128,529
$128,544
Because we purchased all of our hard resources in Phase II, we will not need to purchase
any during Phase III, with the exception of our domain registration renewal fee (paid yearly). As
far as personnel resources are concerned, the marketing director’s hours will now be included in
our personnel costs since advertising, marketing, and promoting our product is most crucial in
this phase. We will also be incurring costs for an attorney, whereas such costs were included in
the 40% overhead in the previous phases. Other additions to our personnel include C3P
representatives (to vendors and businesses) and a customer support team.
COST PER CUSTOMER
Based on an avg of 500 employees
Component
Rental Fee - Server & Database
Software Package
Service Fee
C3P Cards
LEASING TOTAL
LEASING
Quantity
Per Employee
Yearly
Yearly
Per Employee
Cost
$20
$20,000
$5,000
$1
Total
$10,000
$20,000
$5,000
$500
$35,500
Included in the cost per customer is a rental fee for our database and server space, in the
amount of $20 per employee (those with C3P accounts), a software package fee of $20,000 per
year (includes access to the customizable database, purchase checking capability, and GUI), a
hardware and software service fee at $5,000 per year, and the programmed RFID C3P Cards at
$1 per employee C3P cardholder. The customers will also receive a user manual and
authentication code for our website. The total cost per customer for leasing our product is
$35,500.
BREAK-EVEN ANALYSIS
Break Even Analysis
Initial Cost of Customer Support = Out Years Budget
Will increase by 20% for every 10 companies
Customer
Support
Costs
# of Companies
Initial Profit
Total Revenue
0
-$624,434 $128,544
$0
2
-$553,434 $128,544
$71,000
4
-$482,434 $128,544
$142,000
6
-$411,434 $128,544
$213,000
8
-$340,434 $128,544
$284,000
10
-$269,434 $154,253
$355,000
12
-$198,434 $154,253
$426,000
14
-$127,434 $154,253
$497,000
16
-$56,434 $154,253
$568,000
18
$14,566 $154,253
$639,000
20
$85,566 $185,104
$710,000
22
$156,566 $185,104
$781,000
24
$227,566 $185,104
$852,000
26
$298,566 $185,104
$923,000
28
$369,566 $185,104
$994,000
30
$440,566 $222,125
$1,065,000
32
$511,566 $222,125
$1,136,000
34
$582,566 $222,125
$1,207,000
36
$653,566 $222,125
$1,278,000
38
$724,566 $222,125
$1,349,000
40
$795,566 $266,550
$1,420,000
42
$866,566 $266,550
$1,491,000
44
$937,566 $266,550
$1,562,000
46
$1,008,566 $266,550
$1,633,000
48
$1,079,566 $266,550
$1,704,000
50
$1,150,566 $319,859
$1,775,000
52
$1,221,566 $319,859
$1,846,000
54
$1,292,566 $319,859
$1,917,000
56
$1,363,566 $319,859
$1,988,000
58
$1,434,566 $319,859
$2,059,000
Profit
-$128,544
-$57,544
$13,456
$84,456
$155,456
$200,747
$271,747
$342,747
$413,747
$484,747
$524,896
$595,896
$666,896
$737,896
$808,896
$842,875
$913,875
$984,875
$1,055,875
$1,126,875
$1,153,450
$1,224,450
$1,295,450
$1,366,450
$1,437,450
$1,455,141
$1,526,141
$1,597,141
$1,668,141
$1,739,141
The chart above illustrates how many customers C3P needs to break even. The analysis
includes our initial profit which is our total budgeted costs for all phases, our customer support
costs (the out years costs per year and the 20% increase for every 10 companies we acquire as
customers), total revenue, and profit which is based on our Phase III/initial out years budget
total. Based on the calculations, we will need to have 14 companies as customers to break-even.
Highlighted in red is also the 4th company, which represents when we will be earning a profit
based on our production out year’s costs.
BREAK-EVEN ANALYSIS (CONTINUED)
Break-Even Analysis (Out Years)
$2,000,000
Profit
$1,500,000
$1,000,000
Profit
$500,000
$0
-$500,000
1
3
5
7
9 11 13 15 17 19 21 23 25 27 29
# of Companies
Break-Even Analysis (Initial Profit)
$2,000,000
Initial Profit
$1,500,000
$1,000,000
$500,000
Initial Profit
$0
-$500,000 1
4
7
10 13 16 19 22 25 28
-$1,000,000
# of Companies
These graphs further illustrate when our company will begin to see profits.