©2006 Affiliate Classroom, Inc.

Business OverviewAnik Singal, CEO

Professionalizing the affiliate marketing industry.

©2006 Affiliate Classroom, Inc. 2

Business Model

Professionalize Affiliate Marketing through best practices training, tools and certification

Leverage Web and Information Technologies to deliver products and services at scale

To date, over 11,000 students trained online– Both Affiliate Marketers and Program Managers

©2006 Affiliate Classroom, Inc. 3

What is Affiliate Marketing?

“Affiliate”

Website Online Retailer

Commission5 – 70%

“Merchant”

Traffic

Highest ROI Advertising Channel

©2006 Affiliate Classroom, Inc. 4

Affiliate Marketing Explosion

1 Million +

5,000 +

Affiliates

Merchant Programs

“Affiliate Marketing is a $95 Billion industry that is expected to grow to approximately $230 Billion by 2008.”

1996 2006

©2006 Affiliate Classroom, Inc. 5

Online Marketing a $34B Market

Affiliate Marketing

Online Advertising (CPM)

E-Mail

Search

$6.5B

Other Digital

Marketing

$19 Billion

$15.0B

$5.5B

$7.0B

©2006 Affiliate Classroom, Inc. 6

Bigger Than Search

Anne Holland

“Affiliate Marketing will surpass Search Marketing by the end of 2008.”

$7.00B*$6.50B

Marketing Spend, by Source

Search Marketing

Affiliate Marketing

Sources: Search, Google & Yahoo Financials; Affiliate Marketing, MarketingSherpa.com * Estimated

©2006 Affiliate Classroom, Inc. 7

CPA: The Holy Grail

CPAVery Low

(Pay Only On Sale)

Very High(Full Detail On Customer &

Referrer)

CPCMedium

(Pay Per Visitor – No Sale

Guaranteed)

Medium(Knowledge of

Campaign/Keyword)

$7 Billion

CPMHigh

(No Guarantee Visitor or Sale)

Very Low(Knowledge of only

Campaign)$15 Billion(Fast Decreasing)

TransparencyRisk Total Invested

$6.5 Billion

(Fastest Growing)

©2006 Affiliate Classroom, Inc. 8

Marketplace v1.0

Merchants AffiliatesNetworks

Recruiting

Tracking

Accounting

Lack of Transparency

Efficiency (95/5 Problem)

Best Practices Establishment

Need For More Tools/Automation

• A CPA Channel

• Lots of Affiliates

• Increasing Sales

• Program Admission

• Commissions

• More Offers

• Great Support

©2006 Affiliate Classroom, Inc. 9

Marketplace v2.0

Merchants Affiliates

Networks

• More Quality Affiliates• More Transparency• Tools/Training• Lower Support Costs

• Better Offers• Stronger Community• Tools - Automation• Higher Income

• More Transactions• Lower Administration Costs• Affiliate Quality Control

©2006 Affiliate Classroom, Inc. 10

The 3rd Party Solution

The Affiliate Classroom Solution

ContentIndustry Updates

Best Practices

StructuredTraining Modules

eLearning&

Tools

Credentialing

Professionalizing the affiliate marketing industry.

©2006 Affiliate Classroom, Inc. 11

The Systematic Approach

Affiliate

Merchant

Network

Training & Tools Credentials

©2006 Affiliate Classroom, Inc. 12

Multiple Streams of Revenue

Our Main Goal: Center of the Affiliate Marketing Triangle Through Credentialing/Certification

Multiple Streams of Revenue:

1. Certification – Value, Efficiency and Increase Performance Creation.

2. Training – Both Affiliates and Affiliates Managers (scalable virtual facility)

3. Tools – Recurring, Scalable (no matter level of expertise)

©2006 Affiliate Classroom, Inc. 13

1. Value Creation for All Parties

Affiliate

Merchant

Network

SalesSupport Cost

TransactionsAdmin Cost

ConversionsSupport Needs

All Affiliate Sales

1% Total

Revenue

Estimated Total Revenue Potential$230 Billion (est. 2008, Forrester)X .01--------------$2.3 Billion Opportunity

©2006 Affiliate Classroom, Inc. 14

Partners with Top Networks Alone

Estimated Total Revenue$19,000,000,000 X .01--------------

$190 Million

Top Networks Their Revenue

Commission Junction 110,000,000

LinkShare 200,000,000

Performics 50,000,000

ShareASale 5,000,000

Kowabunga 5,000,000

CPA networks 200,000,000

Total Revenue 570,000,000

Total eCommerce:

$570,000,000 / .03 = $19,000,000,000

©2006 Affiliate Classroom, Inc. 15

2. Training & Tools

Marketing Training & Tools

Estimated 3 Million Affiliates

Average Active Affiliate: Spends $3,180/Year On Business

• Training

• Hosting

• Domains

• Promotion Tools, etc…

Assume We Blow It!

Only 1% Market Share

- 30,000 Affiliates - We Discount Same Services To $2,000/Year.

Estimated Total Revenue$30,000 X 2,000--------------

$60 Million/Year

©2006 Affiliate Classroom, Inc. 16

All Together – Large Opportunity

Certification Revenue: $19,000,000,000 X .01

$190 Million

Tools Revenue$30,000 X 2,000

$60 Million+

Total Revenue:

$250 Million

=

©2006 Affiliate Classroom, Inc. 17

Training Pays Off!

Average AC Student– 11% increase in sales– 3 less support requests per week

Bottom Line– Both Merchants and Networks can

see dramatic increases in sales and decreases in support cost.

©2006 Affiliate Classroom, Inc. 18

What Students Are Saying…

“I made $20,000 just because of

ONE recommendation made by Affiliate

Classroom…”

Nana Gilbert-Baffoe

“I just started…failed everywhere else, AC has helped me start

earning over $500/month right

away…”Evelyn Grazini

“…Then I bumped into Affiliate Classroom…approval

by Google Adsense immediately, 9.25% CTR, 20

subscribers a day…”

Abhishek Agarwal

©2006 Affiliate Classroom, Inc. 19

What Partners Are Saying…

“If you want to see the future of affiliate

marketing, just watch Affiliate Classroom…

Kristopher JonesCEO

We will definitely be recommending AC to our clients. Great job!”

VP of Sales

“Affiliate Classroom provides a service this industry

desperately needs and is already benefiting from…”

Shawn CollinsCEO

©2006 Affiliate Classroom, Inc. 20

AC MilestonesJanuary 2005 Affiliate Classroom v1.0 Training Facility Launch

May 2005Affiliate Classroom Surpasses 1,000 Members

December 2005Admitted to UMD VentureAccelerator Program

May 2006 Established 1st Relationship with Major Network

June 2006Affiliate Manager Training Course Launch (200 Customers in 14 Days)

©2006 Affiliate Classroom, Inc. 21

Management TeamAnik Singal: Founder & CEO

– Affiliate marketer since 2001; selected as UMD Hinman CEO “Entrepreneur of the Year” in 5/’05; University of Maryland (Finance)

Helen Montgomery: CCO - Chief Content Officer

– With AC since inception; marketing and Internet editorial experience for various brick-and-mortar domains and many web-based properties – 10+ Years of experience.

Richard Ruggiero: CFO

– Multiple CFO roles in venture-backed startup companies including PowerPrecise Solutions. Senior management positions at General Electric and Newbridge Networks.

Guidance from Venture Accelerator – Scott Laughlin, Scott Magids and Sarah Djamshidi

©2006 Affiliate Classroom, Inc. 22

Financial Achievements/Goals

2004 – Launched BETA Site

2005 - $330,000 Revenue

2006 - $1,000,000 est. (300% Growth)

2007 – Reach Break-Even

2010 - $150M; 25% EBIT

©2006 Affiliate Classroom, Inc. 23

Funding Requirements

Current draft* models show $2M required to achieve break even

Use of Proceeds– Key Team Hires (Technical Lead & Biz Dev)– Critical Technical Development (Version

2.0)– Initial Product Marketing – Working Capital

* Additional modeling and planning required!

©2006 Affiliate Classroom, Inc. 24

In Summary

Affiliate Marketing: Highest ROI Form of Advertising

Fastest Growing Online Marketing Channel$6.5B in Commissions“Set to Surpass Search Marketing by 2008”

Substantial Problems Exist For Industry To Go The Next Level:Affiliate Classroom is the best positioned in the industry to help provide a solution.