Music Securities’s Micro Investment Platform “Securite” ©2013 MusicSecurities,inc all right reserved. I used to be a MUSICIAN - Serves as CEO of Music Securities and runs a micro investment finance platform called “Securite.” - Established the company in 2000 with the goal of attracting investments directly from fans of musicians. Since 2006, the company offers various funds for small companies and also launched the first Microfinance Fund in Japan in 2009 and the "Securite Disaster Area Support Fund" in 2011. - Has been selected as one of the Young Global Leaders for 2013 by the World Economic Forum (Davos Forum). Copyright 2013 (c) Music Securities, Inc. 1 Securite’s Website (http://www.securite.jp/) ・199 Funds ・108 Business Operators ・70,000 Members ・Small-lot micro investment (USD 100~) Copyright 2013 (c) Music Securities, Inc. 2 Securite: How It Works Business Operators Fans (Investors) 1. Post a business plan 2. Invest 3. Utilizing funds 4. Financial & Non-monetary Return Copyright 2013 (c) Music Securities, Inc. 3 Why Investment Investment, not donation ・Fifty-fifty relationship ・Proprietor’S motivation for sustainable business and financial return for investors Investment, not loan ・Flexible distribution schedule which suits for variable businesses such as 3-year-aged Japanese Sake ・A financial return depends on the sales Copyright 2013 (c) Music Securities, Inc. 4 2 Partnership Agreement Silent Individuals Proprietors Silent Partnership Agreement Investors Business Operators ・Fund raise ・IR ・Management ・Audit ※ Money flow ※ The formation, construction, and the rights and obligations of the parties of a Tokumei Kumiai are provided in Articles 535 to 542 of the Commercial Code of Japan ※ Under some conditions, the fund is regarded as capital, not dept, by a bank Copyright 2012 (c) Music Securities, Inc. 5 Why Invest? More than 70% of the investors have decided to invest due because of their interests in the company/projects/products and willingness to support them 35% 30% 25% 20% 15% 10% 5% 0% ① ② ③ ④ Reason for investment (Investor survey; multiple answers not allowed, 9,812 active responses) ① Like company ③ Empathy for project mission ② Like products/services and willing to support ④ Financial return Copyright 2013 (c) Music Securities, Inc. 6 Case # 1: Music Funds: AK-69 ・Music Funds for AK-69 15 ・Total Amount of Issue USD 3,712,700 ※The Most Large Size USD 773,900 ・The Best Fund Result 136.14% AK-69 won Billboard JAPAN MUSIC Awards “INDEPENDENT ARTIST OF THE YEAR 2011 & 2012.” AK-69 performed live at the event "Harlem Day" in New York which was hosted by the most influential hip-hop radio station in the world, Hot97; a first for a Japanese rapper to perform at the show. Copyright 2013 (c) Music Securities, Inc. 7 Case # 2: Sake Funds (Japanese Sake, Beer, Wine) ・Sake Funds 28 ・Total Amount of Issue USD 3,648,500 Sake fans support Sake maturation Investors receive special Sake gift Sake manufacturers distribute Sake in case loss of principal Copyright 2013 (c) Music Securities, Inc. 8 Case # 3: Microfinance Funds ・MFIs 3 ・Total Amount of Issue USD 2,571,000 ・Countries Cambodia and Vietnam ・1st Fund’s Result Cambodia ONE 124.58% Individuals, who value for poverty alleviation in developing countries support microfinance institutions (MFIs) Investors can go to a tour and visit MFIs and their clients Copyright 2013 (c) Music Securities, Inc. 9 Case # 4: Disaster Relief Funds ・ Disaster Relief Funds 39 ・ Business Operators 37 ・ Total Amount of Issue USD 11,260,400 1 unit = donation + investment + fee = 5,000 JPY + 5,000 JPY + 500 JPY = 10,500 JPY (105 USD) Copyright 2013 (c) Music Securities, Inc. 10 New Projects are Coming Soon Japanese Fans (Investors) 1. Support Business operators 2. Introduce 3. Invest 4. Financial & Community Return Copyright 2013 (c) Music Securities, Inc. 11 Start New Partnerships from Today Utilize Affluent Financial Assets of Japanese Individuals Start the partnerships from Latin America to Worldwide YOU ARE THE NEXT ! Copyright 2013 (c) Music Securities, Inc. 12