GEM: Grace Entertainment Media An Interactive Hub for Christian Media GEM: Mission To provide Christian media content across all social-internet media platforms so that users around the world can be exposed to Christian values in their everyday walk through life. Provide revenue streams for Christian Churches and Non-profit organizations to help support their programs. GEM: Background Early stage multi-media company Provides Christian filtered content across media segments: Movies, TV, Music, etc. Experienced management team (over 20 yrs. each) Monetization through Advertising, Affiliate agreements (royalties), User fees Access via all computer-smart devices Company addressing market need at time when Social Media is growing at 20% per year GEM: Market Factors (Drivers) Utilization of Social Media is increasing as minutes of use increase (21%/year). World-wide purchasing of goods and services is increasing across four regions. Religion is still a very important concept to 80% of the general US public. People located in all regions are over 50% likely to purchase products via internet/social media. SM Total Time Spent by Device: (Minutes in 000,000,000) Total 430.4 362.7 348.6 PC 520.1 21% 4% 2012 Mobile Web 28.1 23 22% Mobile Apps 129.4 58.8 0 2011 120% 200 400 600 Nielsen, The Social Media Report 2012 How Likely to Purchase Via SM in 2013 Percentage (Nielson 2012) 90 80 70 60 50 40 30 20 10 0 Entertainmnt Travel/Leisure Food/Bev Home Elec Appliances Clothing Restaurants Financial Dating Region Nielsen, The Social Media Report 2012 GEM: Characteristics of RespondentsExisting Research Data Surveys by Gallup Poll and Nielsen-20112012 and databases Major Characteristics: Respondents ◦ Time on Devices, ◦ Importance of Religion ◦ Likely to Purchase via SM Importance of Religion-all respondents 70 Percent % 60 50 40 1992 30 2002 20 2012 10 0 Very Important Fairly Not V. Important Import Survey Response No Opinion Gallup Poll: www.gallup.com/poll GEM: Environmental Factors-2 Church membership & attendance declining-provide religion (ministries) online Social care (c to b) interactions increasing-highest in younger age groups Advertising on-line is positive-68% (largest revenue source for media companies) Church Membership (% respondents) 80 70 Percent % 60 50 40 Yes 30 No 20 10 0 1992 2002 Years 2012 Gallup Poll: www.gallup.com/poll Frequency Attendance How Often Do You Attend Church Never Seldom Once a month 2012 2002 Almost once/wk 1992 Once a week 0 10 20 Percent % 30 40 Gallup Poll: www.gallup.com/poll % Engaged in Social Care by Age Percent Prefer Social Care Company Contact 40 37 35 35 31 30 26 25 24 20 17 15 10 5 0 18-24 25-34 35-44 45-54 55-64 Nielson Social Media Report 2012 Over 65 Social Media Revenue-Ad Perception 17% Ads Annoying 32% Pay Attention to Ads Profile Based Ads OK 25% Ads Connect to Brand 26% Nielson Social Media Report 2012 GEM: BUSINESS MODEL Provide 10 networks (segments) with multiple channels (categories) of content for Social Media users Monetization through Advertising, Affiliation Agreements (fees generated per transaction) and User fees Experienced (20+ years each) Management GEM Movies On Demand Demo Site www.graceent.com GEM: The Solution Will be the World’s Leading Christian Media Source: •1. Our Facebook will be Gracebook; •2. Our iTunes: HeTunes; •3. Our Netflix GEMFlix, •4. Our Amazon? Amazing! •5. Not TBN but GBN - New TV: movies, talk shows, news, sports, comedy, docs, etc. GEM Movies On Demand Demo Site www.graceent.com GEM: Management and Business Model • Management personnel over 20 yrs each in experience • Revenues based on existing social media business models • Business model unique to this market (Christian SM users) Chairman/ President/Founder Ken R. Unger 1. Over 30 years professional experience. 2. Reaching mainstream and nondenominational Christians 3. Music, radio, books and films. 4. Degrees in Marketing, Management, Psychology and a Masters in Theology. Business Development Consultant Clark Danielson 1. 2. 3. 4. Over 20 years experience in investment services, education and business management. Managed investment portfolios at Morgan Stanley and Seidler, acquired funds for research and institutional development. Investment management, Health care research and education. Degrees: BA Political Science, Masters in Public Administration, Doctoral coursework COO/CFO S. J. Andre 1. 2. 3. Over 20 years in financial management and reporting, long range planning, cash-debt management, SEC compliance, business development and shareholder relations, 2. Startups and the management of rapid growth as well as established firms in both the private and public sector and entertainment. Sandra has a BS in Business Administration and an MBA in Business. VP Corporate Development Tom Keegan 1. 2. 3. Entertainment industry veteran of over 30 years. Over 500 productions for ABC, CBS, NBC, PBS and National Syndication Turner Media Group, Fox News, Salem Communications, IBM, The National Football League, etc Ran a Christian TV network. Director Ron Pierce 1. 2. 3. 27 years total IT experience in Web Architecture, Engineering, Design and Implementation. 2. He's also built huge projects both in the gov. and private sector Fully qualified in web portal design, architecture and implementation. GEM: Monetization 1. Advertising (largest revenue sources) 2. Marketing & Merchandising o A. Affiliates (Amazon, etc.) o B. GEM-Brands (Clothes, books, etc.) o C. Promotions (i.e. New Artists, Movies, Books, etc.) 3. Premium Services (Movies, Music and Publishing on demand, etc.) Business Model Figure 2: GEM Quality Assurance Advisors/Board Quality Assurance Content Develop Agreements Revenues Building Relationships Transparency Communication AFFILIATES Mega-Churches (Consumers/users) ADVERTISERS PPC GEM: PRO FORMA 3-year projects Profit Margins ROI GEM: Return on Investment Year1-3 (In $000,000) Year 1 Year 2 Year 3 Total Revenues 14.346 16.692 25.038 Gross Profit 4.8 15.6 23.4 Gross Profit Margin .33 .93 .93 ROI .57 Assumptions: Advertising-25 cos. @ $5,000; 6,250 users @$30 * 5% royalty * 183days; Web hosting 31,250 users @ $10/month; Capital raise $6 million in year 1; Investor payout $9 million in year 2 Terms of Investment $500,000 = 2.5% stake in company Investors have first right of refusal to continue to invest at a later date for new issues of stock. First $500,000 invested receives 5% stake in company Investor payout in year two at 1.5 times original investment. Strategy/Timetable •Initial Build Out: First 90 Days o Launch Initial Sites/Beta test (60 days) o Initiate Traffic (Free) •Ramp Up: 6-12 Months o Perform Customer Validation o Add content based on results o Implement Monetization (Premium services, on- demand programs, ad revenues, etc.) o Launch official site •Aggressive Marketing: Years Two & Three DISCLAIMER Grace Entertainment Media (GEM) • Grace Entertainment Media (GEM) and/or Ken R. Unger does NOT represent to be a United States Securities Dealer or Broker or US Investment Advisor. • As a Representative of Grace Entertainment Media (GEM) and/or Ken R. Unger , we make no Warranties or Guarantees or any representations to the investor, buyer, seller or Transaction. • All due diligence is the responsibility of the Buyer, and seller, or borrower and lender. • This information presented and any related documents are never to be considered a solicitation for any purpose in any form or content and are provided here for educational purposes only. • This information presented and any related documents hereto is a response to a formal request of information only. Upon receipt of the information and/or documents, the recipient hereby acknowledges this disclaimer. We do not provide securities or security related advice. • No information herein shall be construed as a solicitation of investment funds or a securities offering in any way. Q&A GEM Your Interactive Christian Media SuperSite Copyright 2013, Ken R Unger & Clark Danielson Ken R Unger: KenRUnger@aol.com, Phone (714) 814 – 3200 Clark Danielson: clarkdanhb@yahoo.com, Phone 714-273-1674