“Vox Pop is what Starbucks wishes it were. Vox Pop doesn't really
remind me of any other business. It's more like somebody's dream of a
fantasy business made real.”
—JOYCE HANSON,
CUSTOMER
The Vox Pop Opportunity:
Vox Pop is the natural next step in the
evolution of the American coffeehouse.
• With the slogan, “Books, Coffee Democracy” Vox Pop
is America’s community-empowering,
publishing cafe, with locations in Brooklyn and
Manhattan, NYC.
• Vox Pop is a proven new method of selling 100% Fair
Trade, high-end, great tasting, coffee. We had robust
gross margins of 86% in 2008.
• 2008 sales grew 35%.
• In 2007, Vox Pop Inc. posted its first profitable year,
reporting earnings of $45,954 on sales of $354,472.
• Vox Pop is a triple-bottom-line business: It’s about
“people, planet, and profit.”
2
Vox Pop Victories: 2008
• Vox Pop opened its second location in Manhattan, inside
the world-famous Bowery Poetry Club.
• We won New York Magazine’s “Best Of New York 2008”
Award for our kids’ story hour programming. We were praised
for our community-centric focus and progressive agenda.
• Film “Able Danger” debuted in NYC, LA, Oakland, and
Montreal. The film features Vox Pop, our New York
Megaphone, a character based on CEO Sander Hicks, and the
book Hicks wrote about the 9/11 cover-up.
“SURPRISINGLY ENTERTAINING ZERO-BUDGET FILM
NOIR THAT EFFECTIVELY MIXES PSEUDOHITCHCOCKIAN THEATRICS WITH A HEFTY DOSE OF
CONTEMPORARY LEFTY PARANOIA.”
NEW YORK MAGAZINE CRITIC’S PICK
3
Vox Pop is a Citizen’s
Media-Incubating Machine
• Progressive tabloid newspaper, published by Vox Pop since 2006.
• Ad sales of $9,880 annually make it a break-even. Provides $2,000
worth of free advertising to the cafés, per issue.
• Volunteer “Citizen Journalists” and Vox Pop staff run the paper.
Customers get involved.
• Exclusive scoops on Federal, NY State and NYC government
corruption, plus local alternatives. 50,000 printed per issue.
• A wholly-owned side business, in a storefront next to the
Brooklyn café, PY! provides “print on demand” low-cost book
printing and publishing services to about 600 new authors.
• Operating profit margins of 53% gained Fall, 2008.
4
Citizen’s Media
Marketing: Results
Vox Pop’s New York
Megaphone and Publish
Yourself! store reflect our
core values:
• The free expression of the people.
• The democratization of mass media.
Publishing our own newspaper creates a robust, unique form
of marketing. The growth of the circulation, free advertising for
Vox Pop, and print runs of the Megaphone correlates to the
aggressive growth in sales of the Vox Pop cafés.
CONSISTENT JUMPS IN ANNUAL SALES:
In 2007, 53% growth in sales, in just one store.
In 2008, we are on track to enjoy a 35% increase.
5
Biggest Cash Cow:
The Coffee.
Market
• Measured in dollars, coffee is the USA’s biggest import
after oil.
• Coffee is a $34 billion market.
• Specialty coffee is a $13 billion retail market per year.
• “Fair Trade” is the fastest growing segment of that market.
Margins
Financials on Coffee, 2007
Sales:
$145,632
COGs:
$19,707
Gross Profit:
$125,925
Our annual gross margins on coffee are currently 86%. In
2007, we had sales of $145,632 on coffee expenses of
$19,707.
Strong Food Sales
Our coffee is better, more flavor, richer, not “burnt and bitter” like corporate chain coffee. We also sell more food than
the competition. The average Starbucks sells food at 15% of
total sales annually. With longer hours and night-time events,
ours averaged 32% of total sales in 2007.
6
Strong Same Store Sales
Despite the Recession!
In September, 2008 the US Department of Commerce
reported that retail sales across the USA dropped by 1.2
percent.
YET, VOX POP CORTELYOU’S SALES JUMPED BY 5.3%
September 2007: $29,842
September 2008: $31,428
WHY DID VOX POP SALES GO UP WHEN THE COUNTRY WAS GOING
DOWN THAT MONTH?
• In a time of national crisis, we are the gathering place,
the place of shelter, of succor and support.
• At Vox Pop, especially in a recession, the community
gathers to:
• Commune
• Check employment listings on our free wifi
• Eat good food together,
• Sympathize with each other
• Discuss ideas and politics and candidates
• Plan for the future
All while drinking great coffee, and buying food. That’s
what a coffeehouse is supposed to be:
7
RAMBUNCTIOUS. VIBRANT. ALIVE.
3Q 2007 Compared to
3Q 2008, CompanyWide
2008 Growth,
Third Quarter
Vox Pop, Cortelyou
101,113
Publish Yourself!
11,114
Vox Pop, Bowery
28,509
59
8
3Q, 2008
140,736
3Q, 2007
88,428
Total Corporate
Growth, 3Q, 2008
59%
Same Store Sales
Growth, 3Q, 2008
14.3%
Sustainable Buildouts
• We built our Manhattan Vox Pop and Publish
Yourself store, in 2007, and 2008, using recycled
building materials from a good quality
green salvage retailer, Build it Green.
• We publicized the use of sustainable construction
methods.
• Build it Green is also an advertiser in the
Megaphone, so some of the construction
purchases have been “cash-free” and done
through barter.
• Our construction costs were 1/6th the cost of
using new materials.
9
Long Range Plans
We are raising $5 million with which to open 24 more
company-owned stores in Brooklyn, Queens and
Manhattan. We plan on opening three stores every quarter
for the next two years.
Franchising
We want to begin franchising in the NYC metro area,
especially New Jersey and Connecticut. We already have
a good relationship with franchising experts iFranchise
Group of Chicago.
Valuation
According to iFranchise Inc. of Chicago, companies
like us on the verge of franchising, with our level of sales,
earn a multiple of 6.7.
Our 2009 projected annual sales are $709K. $709 times
a multiple of 6.7 is $4.75 million.
10
The Return
• $5M builds 24 more company-owned Vox Pops, in two years.
• In five years, we can expect to have 65 franchises sold, according to industry experts.
• 25 stores x $404K in annual sales= $10,111,300 in gross sales.
• Year 2014 income from Franchising (5% of sales)=
$1,137,500
• Year 2014 Total Gross Sales
(proj.) $11,248,800
EXIT STRATEGY
• Our focus is on building a profitable business, and then taking
what options we can to go public.
11
The Team
12
Sander
Hicks
Hicks learned high-growth retail from ten years at
Kinko’s of Manhattan, where he was a part of the team that
grew the partnership from one store to seven. At his first
company, Soft Skull Press, Hicks gained national media
acclaim for his controversial re-publishing of a Bush
biography, covered by award-winning Cinemax documentary, “Horns and Halos”. Hicks is founder and CEO of Vox
Pop Inc. His article on public interest venture financing was
recently published on AlterNet.
Thomas
Barr
Barr is an alumnus of the number three-ranked hospitality program in the country, Collins School of Hospitality
Management at Cal Poly, Pomona. Barr’s hospitality degree
carried an emphasis in Beverage Marketing, and he earned
a level one Sommelier certificate. Barr has worked at Vox
Pop as Assistant Manager, General Manager, and was
recently promoted to Regional Manager, Northeast.
Andrew
Laties
Andy Laties is co-founder of Vox Pop. His innovative
retail practices have been studied and copied by Barnes &
Noble, so he made his trade secrets public in his book,
Rebel Bookseller (Vox Pop), a how-to guide for independents who want to take on and beat the chains. Andy has
launched three successful independent bookstore/retail
outlets: The Museum Shop at Eric Carle Museum of Picture
Book Art, The Children’s Bookstore, and the Children’s
Museum Store at Navy Pier, Chicago, IL.