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Name of Applicant: Bluestem Software Inc.
(Legal name and operating name, if different)
Company Address:
(street, city, postal code)
GST/Business Number: (if applicable)
Phone No.:
1040 - 259 Portage Avenue
Winnipeg, MB R3B 3P4
123456789
(204) 555-5555
Fax No.:
Email: cpage@bluestem.ca
Contact Name and Title: Carolyn Page (President)
Industry Sector:
Business Structure:
Ag Bio
Clean Technology
Information Communications Technology
New Media
Food
Life Sciences
Manufacturing
Service
Other (specify):
To be incorporated
Federally Incorporated
Provincially incorporated
Partnership
Sole Proprietorship
Cooperative
Other (Specify):
N/A If you are a subsidiary, who is the parent organization?
If your venture is not functioning as a business entity, when do you anticipate it will?
Year of Establishment
N/A
2013
Number of Employees:
(204) 555-5555
Full
Time:
2 Part Time: 0 Contract: 0

Provide a description of what your business does: (max. 150 words)
Bluestem Software Inc. was founded in 2013 based on the concept that enterprise applications should be simple to deploy and maintain. Our software, JavInstall, enables fast, reliable server deployment while virtually eliminating configuration errors and accelerating the enterprise application development life-cycle.
Bluestem's business model follows the traditional "license-for-use" software paradigm. Customers can purchase a perpetual license of JavInstall for a one-time cost. Bluestem will charge additional annual maintenance fees for access to updated versions of the product. This creates both strong revenues from new customers and annuity streams from existing customers. The distribution model will leverage the internet. Bluestem will operate a “download, try, and buy” model. In the early phases of product rollout, we will employ a small direct sales force in combination with an online channel promoting sales.
List the names and provide a brief description of the full time members of your management team.
Please identify which members are founders: (max. 200 words)
Carolyn Page (founder) - President
Ms. Page has 10 years of experience in the software development industry, eight of which are in senior management positions in Operations, Project Management, and Quality Assurance. Ms. Page has spent the last six years working specifically with J2EE technologies. Nine years of Ms. Page's work has been with start-up software companies.
John Perez (founder) - Director of Technology
Mr. Perez has eight years of experience in the software development industry, and has spent five of those years at start-ups. Mr. Perez has spent his career focused on configuration management and deployment of enterprise applications. The last six years of his software career have been spent specifically building deployment, configuration management and build solutions for J2EE technologies.
Mr. Perez is the sole author of the JavInstall product.
Without describing your product, describe the opportunity you are addressing in measurable terms. Include such info as market size, market growth rate, and life cycle / industry trends: (max.
500 words)
Installing software is a familiar process to most of us: double click on a setup program, answer a few questions, wait a few minutes, and the software is installed. For enterprise web applications, however, the experience is very different. For these applications, installation and deployment is complex, time consuming, error prone, and technically challenging.
The dominant technology in enterprise web applications is Java 2 Enterprise Edition (J2EE). Currently, about 50,000 companies spend more than $6 billion on J2EE products annually (Gartner, 2012; BZ
Research, 2012; BEA Systems 10K, 2013). J2EE applications run inside what is called an “application server.” The dominant vendors of J2EE application servers are IBM’s Websphere, BEA System’s
Weblogic, and JBoss (J2EE Survey, 2012; Gartner, 2013).
By 2017, industry analysts expect 18% of all application development to involve the J2EE architecture.
Given that approximately 5% of all application development today involves J2EE, we conservatively forecast the number of companies using J2EE to double from 50,000 to about 100,000 by the year
2018 (BZ Research, 2012; Gartner, 2012).
Today, there are two main ways that companies deploy and install their J2EE applications. One is manual deployment. In other instances, companies use a series of internally developed custom scripts to deploy J2EE applications.
According to conservative estimates, which we based on our primary research, current spending on
J2EE application deployment averages about $20,000 per company per year. That cost breaks down to
65% labor cost from time to deploy, 30% fixing deployment-related defects, and 5% on deployment related software.
Using this cost analysis, we estimate the current market size for J2EE deployment to be about $1 billion dollars (50,000 companies * 20K). In 2018, this will double to roughly $2 billion as the number of companies using J2EE applications doubles to 100,000.
Bluestem’s products fall in a niche between two existing industry segments: J2EE Management software and installation software. The major companies in the J2EE Management software industry are IBM / Tivoli, Mercury Interactive, Wily Technology, Precise Software, and Quest Software (Gartner,
2013). This industry is focused primarily on performance monitoring and tuning of J2EE applications rather than installation and deployment. The dominant company in the installation software industry is

Macrovision. This industry mainly focuses on installation software for Microsoft Windows.
Sources:
BZ Res earch, “Annual Java Use and Awareness Study,” November 2012.
BEA Systems, 10-K SEC filing, January 31, 2013
Gartner, “Magic Quadrant for J2EE Application Server Management.”, April 4, 2013.
The Middleware Company, “J2EE Application Server Survey 2012”, June 2012
Describe how your product will be a solution: (max. 300 words)
Our product, JavInstall, makes installing J2EE applications almost as easy as installing a desktop application. Instead of a collection of files and configuration information, JavInstall builds a single program. Engineers can then copy and execute that program in any environment (development, test, production) or application server (JBoss, Websphere, Weblogic).
This software fills a niche within both the J2EE Management and installation software industries. No company producing J2EE Management software has an installation tool, and no installation industry companies have the kind of support for J2EE configuration that JavInstall offers.
JavInstall has several advantages over current J2EE application deployment tools, which consist of manual deployment and custom utilities:
1. JavInstall is faster than manual deployment and requires a fraction of the development time that custom utilities require.
2. It reduces configuration defects by 50% or more by automating the deployment process and providing a single configuration file for all different environments and server platforms.
3. It makes deployment a non-technical task. One can simply double click on the program, answer a few questions and the application will deploy to the server or servers specified.
The advantages of the software will provide customers with a return on investment. This reduction in installation time and errors means that companies can reduce their J2EE application installation costs by over 50%. These savings allow developers to devote resources to other productive, revenuegenerating activities rather than on deployment.
Briefly describe any market research to validate the need for your product. This may include interviews with potential customers or reference articles used. See Market Validation – “Ready
Stage”.
In order to identify current difficulties with developing J2EE applications, we developed a series of online surveys to determine where companies are currently experiencing the most pain in their processes. We distributed the survey to 586 users of J2EE application servers. These users were drawn from more than a dozen Java, application-server, and J2EE newsgroups. We received 54 responses. In addition, we conducted numerous face-to-face interviews with users of J2EE application servers to determine both their current pain points and their interest level in a product like JavInstall. 10 of the survey respondents have also agreed to be beta customers of JavInstall.
The survey results were compelling. First, the 54 survey respondents identified a broad level of pain in dealing with J2EE applications – including difficulties with aspects such as deployment (with 70% rating this aspect at a high pain level), configuration management (45%), communication (39%), and performance (45%).
Second, deployment was clearly their number one pain point. On a scale of one to seven (seven representing the greatest level of pain), about 70% of respondents ranked deployment pain at five or higher; 45% of respondents rated it a six or higher; and a full 15% rated it a seven.
Third, our research showed that 60% of companies using J2EE application servers are using application servers from different vendors in the same environment. Additional secondary research also shows that organizations are supporting a growing number of applications and deployments into increasingly complex application environments (Ptak et al, 2013). The current problems identified with deployment will only get worse.
We also asked our survey respondents how they liked their current deployment tools. We asked if they a) liked them; b) were satisfied with them; c) were unsatisfied with them or d) hated them. Our respondents voiced a high degree of dissatisfaction with their current deployment tools. One third of them were satisfied; one third were dissatisfied, and one-third of them hated their current deployment tools. Only one respondent said his company liked their current tools.
In summary, these results show two things:
1. Installing and configuring J2EE applications hurts
2. Companies deploy their code to multiple vendors
JavInstall is ideally suited to mitigate this market pain because it automates the deployment of code to multiple vendors in a fast and error-free way. We intend to target development managers at independent software vendors (ISVs) as our initial customer base. We conservatively estimate that this

makes up 5% of the total J2EE market (BEA Performance Metrics, 2013). The pain of deployment to various J2EE application servers has a disproportionately large impact on these ISVs and they will get the most benefit from JavInstall. ISVs tend to use J2EE servers from multiple vendors, which exacerbates deployment problems. ISVs also tend to have time-sensitive deployments. Saving time on deployment is of real value to these potential customers.
Sources:
BEA Systems, “Supplemental Performance Metrics,” February 2, 2013.
The Middleware Company, “J2EE Application Server Survey 2012”, June 2012
Ptak, Noel, & Associates, “The State of J2EE Application Management: Analysis of 2013 Benchmark
Survey,” November 2013.
Describe the intellectual property that you currently own or control:
Bluestem Software Inc. owns the copyright to the software ’s code.
Bluestem has also registered trademarks in the U.S. and Canada for the company name and the product name (JavInstall).
What are the project deliverables and their timelines for your proposal? Please refer to the program guidelines for examples of outcomes for Stream 1 and identify the outcome(s) being met by each proposed deliverable.
Deliverable #1: Release of beta version of JavInstall software – September 2014
Deliverable #2: First commercial release of JavInstall - January 2015
These deliverables meet the following CSB Stream 1 outcomes:
- Completion of a working prototype (i.e. the beta version of the software)
- Completion of a finished good. (i.e. the commercial launch of the software)
List the activities and associated amounts you are seeking support for under this application as they relate to your deliverables. Refer to the program guidelines for ineligible expenditure items.
At this time, Bluestem Software is partially complete with the first release of JavInstall. The program’s core engine is working and our proof of concept is successful. JavInstall currently supports both the
Weblogic and Websphere application servers.
We will be contracting software developers to create the user interface (UI) required for a beta site test release. We will also contract developers to add support for the JBoss and Oracle application servers.
The beta phase will be the product's final stage of development, and will also provide an opportunity to recruit the product’s first customers. At the completion of the beta phase, Bluestem will be ready for a commercial release of JavInstall.
The total estimated cost of this project is $95,000.
The anticipated sources of funding for the project are as follows:
CSB Program: $47,500
Company funding: $47,500
The total project cost is broken down into the following activities:
1. Software development – support for JBoss and Oracle: $40,000
2. Software development - user interface: $19,000
3. Beta testing - $36,000
All third party estimates can be found as attachments to this application.
Outline the economic impacts (in terms of job creation or other benefits to the Manitoba economy) of the proposed venture to Manitoba:
Job Creation:

In late 2014, Bluestem expects to hire two sales and marketing staff as well as two development and support staff to coincide with the commercial release of JavInstall.
If JavInstall meets its expected sales growth, Bluestem will hire approximately 10 additional employees by 2017. This would include two executive management positions, four additional development and support personnel, and four additional positions in the direct sales force.
Sales Growth:
We forecast sales revenues of $320,000 for the first year that JavInstall is on the market (2015). As we continue to expand our customer base, we project revenues of over $1 million in the second year
(2016). The sustained growth of the venture over time will ultimately result in increased tax revenue for the Province of Manitoba.
These revenue projections are based on the following assumptions:
- The total J2EE market will grow from 50,000 to 100,000 companies over the next five years.
- JavInstall will be priced at $2,500 per license, with each customer purchasing an average of 2 licenses.
- Annual support contracts will be priced at $750 per year. An estimated 75% of customers purchasing licenses will also opt to purchase support contracts.
Leveraging Investment:
The completion of this project carries the potential to leverage additional private sector investment into
Bluestem. Following the development of JavInstall, we will seek $350,000 in private equity from angel investors to fund initial customer acquisition.
Are you currently seeking any other Provincial government funding related to this project?
Yes No
If yes, please list the department and name of the program being approached. Provide the name and contact person and amount of funding being applied for.
Are you currently seeking any Federal government funding related to this project?
Yes No
If yes, please list the department and name of the program being approached. Provide the name and contact person and amount of funding being applied for.
Ensure you have included:
Your year to date financial statements and;
One or more of the following documents to support the venture’s ability to pay: company or personal bank statements, letter from a financial institution confirming the amount of available financing, lines of credit, or other forms of financial position.
I hereby apply for financial assistance on behalf of my firm and certify that to the best of my knowledge, the project outlined above will assist in the development or marketing, in a new market, of an innovative product or process.
I will provide, as required, a report on the results of this project to the Department of Jobs and the Economy and agree to participate communications activities relating to this project where appropriate.
I agree to provide the Department of Jobs and the Economy any additional information that may be required for the assessment of this application.

I also agree and consent to the Department of Jobs and the Economy obtaining credit and other information from any source for the purpose of reviewing this application and ongoing monitoring should the application receive approval.
The information on this form is being collected in support of an application for financial assistance and will be used solely for this purpose. It is subject to the provisions of Manitoba’s The Freedom of Information and the Protection of Privacy Act (FIPPA) www.gov.mb.ca/chc/fippa and the federal Personal Information Protection and Electronic
Documents Act (PIPEDA).

Include all information electronically in this form. This form is intended to be read as a standalone document. If necessary, include additional information as appendices or attachments in your email submission.

Fill in your information below the instructions. Be sure to include all the headings and information requested.

Only completed applications will be considered.

Completed applications with supporting information must be emailed to: csb@gov.mb.ca
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Updated June 2014

Bluestem Software Inc.
Balance Sheet
As of July 1, 2014
Cash & Equivalents
Inventory
Pre-Paid Expenses
Other Current Assets
Total Current Assets
$156,001
$286
$22,500
$792
$179,579
Initial PP&E
Intellectual Property
Additional Infrastructure
Accumulated Depreciation
Net Property, Plant & Equipment
TOTAL ASSETS
Accounts Payable
Accrued Expenses
Total Current Liabilities
Long-Term Debt
Total Long-Term Liabilities
TOTAL LIABILITIES
Founder Contributions
Retained Earnings
Total Equity
$0
$0
$660
$350,000
-$154,164
$195,836
TOTAL LIABILITIES & EQUITY $196,496
$5,000
$12,500
$1,000
-$1,583
$16,917
$196,496
$66
$594
$660