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A Business Plan By:
Minh Uong, Adam Steinberger
815 N Broadway
Saratoga Springs, NY 12866
Phone: (518) 362-7623
Email: [email protected]
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 2
Table of Contents
Executive Summary ................................................................................................................ 3
Company Summary ................................................................................................................. 5
Product Description ................................................................................................................ 5 Web Platform .................................................................................................................................. 5 Mobile Application .......................................................................................................................... 7
Mobile Application Features ............................................................................................................... 7 Product Data Sheet ............................................................................................................................. 9
Website Application ....................................................................................................................... 13 Social Media .................................................................................................................................. 13
Target Market ....................................................................................................................... 14
Industry Analysis .................................................................................................................. 15 Mobile Application ........................................................................................................................ 15 Website Application ....................................................................................................................... 17 Social Media .................................................................................................................................. 17 Online Coupon Retail ..................................................................................................................... 18
Competitor Analysis .............................................................................................................. 19 Financial Information ..................................................................................................................... 19 Customer Base ............................................................................................................................... 20 Features ......................................................................................................................................... 21
Product Differentiator .......................................................................................................... 22
Marketing and Sales Plan ...................................................................................................... 25 Marketing Plan .............................................................................................................................. 25 Sales Plan ...................................................................................................................................... 27 Financials ....................................................................................................................................... 28 Start-‐Up Fund ................................................................................................................................ 33
Company Structure ............................................................................................................... 34
Risks Evaluation .................................................................................................................... 35 Threats .......................................................................................................................................... 35
Intense Competition ......................................................................................................................... 35 Legal Requirements .......................................................................................................................... 36
Weaknesses ................................................................................................................................... 36
Legal Requirements .............................................................................................................. 37
Citations ............................................................................................................................... 37
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 3
Executive Summary
The happyroad company from Saratoga Springs creates website and smartphone tools that help
travelers find great places to visit according to the interests of each individual traveler. We ask
for each customer’s personal traveling needs and combine this with his or her Facebook and
Twitter accounts to determine desirable kinds of destinations for the user. Happyroad then finds
places and events that fulfill our customers’ desires from other travel websites like Foursquare
and Google Maps, and the user can then visit any or all of these places en route to his or her
destination. Whether happyroad users travel a mile or 1,000 miles away from the point of
departure, we maximize your traveling experience. Our service will begin as an internal
platform on top of which we will build our happyroad website and mobile applications, and
eventually this platform will be released to public software development teams for making their
own products from our service.
We target people who enjoy traveling by car for distances of 50 miles or more for leisure
purposes. Whether you are young and adventurous or you’re in your 60s and already retired, as
long as you like traveling you are all our potential customers. Whether you want to drive from
San Francisco to Los Angeles, or you fancy a road trip from Seattle to Miami, happyroad will
help you, as our slogan says, maximize your traveling experience. Our
product gives users a happy road to travel on, so that at their destination
they feel satisfied about their journey, and have a big smile.
Our vision is that ten years from now, when the economy recovers, people should have better
living conditions. And as the world becomes much more globalized, the needs for traveling will
increase significantly. People will go from one country to another visiting places they have
never been to before. In these situations, there is a high demand for a tour guide or similar
service. Happyroad is designed to be a personal travel agent for all smartphone users, whose
percentage of the world population will be exploding in the future. Furthermore, when we
release our platform to the public, happyroad will become a massive sandbox for software
developers to design apps that run on top of our product. That means someday users may be
playing Words With Friends with their favorite traveling buddies on happyroad.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 4
Happyroad is very different from our competitors Foursquare, Yelp, Google Maps, LivingSocial
and Groupon. Happyroad is the only online website and mobile app platform to include event
information while planning for trips and to leverage users’ preferences to find the best
combination of places to visit en route. Although daily deal searching is not a main feature of
our product, it will be helpful for users. Happyroad accesses deals from all areas within the
reach of Groupon and LivingSocial.
Most importantly, happyroad reminds people that going from one place to another in the shortest
amount of time and not caring about the journey are not always the best reasons for traveling.
Our mobile app helps you satisfy the true needs and desires for traveling: getting there is half the
fun. Whether you are exploring the world around you, seeking exciting and unusual experiences,
or going on a long trip with your family, we will maximize your traveling experience.
Happyroad will change the way you travel.
Our company will implement an intensive advertising campaign. Since the number of active
happyroad users is fundamental in driving the success of our company, we will spend a great
amount of effort and resources to promote our product. We want to reach out to our potential
customers, and help them understand what our product is and why they might want it.
With our advertising strategy and the unique features of our product, we expect that our customer
base will increase from 3,000 daily active users (dau) in year one to 5,100 dau in year two (70%
increase), and 10,761 dau in year three (110%).
Our company forecast the income statement for the first three years, and we are able to break
even and start making profit in year two. In the best-case scenario, we will make a profit of
about $6,000, $11,000 and $30,000 in year one, $61,000 in year two and three. In the most
likely situation, we will have loss of $960 in the first year and net income of $2,000 and $14,000
in the next two years. These are impressive and highly feasible numbers for our company,
considering all the data we’ve collected and research we have done.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 5
Company Summary
Happyroad, a Saratoga Springs based company, was founded in November 2011 as a partnership
between two students at Skidmore College: Minh Uong, the company’s CEO, and Adam
Steinberger, the CTO. Our company provides the smartphone app, happyroad, and its
corresponding website to help users navigate to a desired destination while maximizing their
traveling experience. Serving our customer and giving them the most enjoyable traveling time
are all the reason why we create happyroad.
While the business concept is already developed, we are still working to finalize our product, and
expect to officially launch the happyroad mobile app as well as the website by mid-June. In the
first year of operation, happyroad aims to serve iPhone and Android users in the United States.
Besides hiring necessary employees, we will implement intensive advertising campaign over
time. Since user base is the fundamental factor in driving the success of the company, our goal is
to increase happyroad’s customer base and its popularity.
After the first year, the service will be expanded into other smartphone platforms and introduced
into other regions in the world. More information about our development plan is provided in the
Sales Plan. Our goal is to eventually have different versions of happyroad in different languages,
so that our product can satisfy the needs of travelers all over the world.
Product Description
Web Platform
The company’s main product is the happyroad web platform. There are six major features built
into our product: web platforms, software development kits, application programming interfaces,
databases, developers and artificial intelligence. Web platforms are a lot like the programs most
computer users are familiar with today. Google Documents, for example, is an online alternative to
Microsoft Word. But, unlike Microsoft Word which must be installed onto a personal computer
before customers can use it, Google Documents is broken up into small pieces, each of which is run
on separate (virtual) computers (i.e. servers, or clusters of them) in a Google warehouse (e.g., a data
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 6
center), that are run at the same time and are pieced together using sophisticated software at Google
before the website loads the application in a user’s internet browser. The advantages to platforms are
that they can be accessed online from any computer, they can handle much larger customer bases
than offline software alone, they can solve very large, complex problems in real time, and the
hardware required to keep the platform up and running can be designed, created, and maintained by a
vendor company’s service like Amazon Web Services.
Software development kits (SDKs) and application programming interfaces (APIs) provide
programmers with a set of tools with which other software can be created using our platform. These
features are like the foundation and frame of a house, where all the tools for designing the interior are
provided by the house and programmers can use these methods to design their own custom interior
furnishings.
Databases are used to store vast amounts of data from the user and other services online, so this data
can be retrieved and/or manipulated later on. A good analogy for databases is a warehouse where
each box delivered has its own unique barcode number. Each item also has its own set of metrics
like weight, volume, dimension, density, price, shelf location etc. If a worker searches for an item by
number, he or she can gather all the metrics for that item, and any changes he or she makes to the
item are kept up to date.
Artificial intelligence (AI) and machine learning (ML) methods are used by the happyroad platform
to learn about our users’ personal travel needs. What’s great about the AI in happyroad is that it does
a lot of the dirty work involved in making the complex decisions required for planning trips for the
user, with potentially much greater accuracy than is possible to achieve using human intelligence
alone.
Our last main feature isn’t actually a machine. None of the structures described so far would work
were it not for teams of software developers both within and outside the company. These people
work together to learn how platforms, SDKs and APIs work, postulate and solve problems using
them, and make cool new programs to extend the functionality of the software currently available to
them.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 7
Mobile Application
The happyroad mobile application helps users navigate to a desired destination while maximizing
their traveling experience. Customers input their preferences for the route, for instance, what they
want to do, where they want to visit, what kind of scenery they want to see, etc. Based on the given
data, our smartphone app and our website give users various places and events en route to their final
destination, which can be anywhere from a mile to 1000 miles away from their starting point.
Users define what is a happy road for them based on the data they provide us. It can be either the
shortest route or a longer one with more fascinating places and events to see along the way. When
you provide the application with large sets of personal data, then the best several places or events
will show up, and either our web platform will choose a place for you, or you can decide which
one you prefer. If you do not want to provide your individual information, then the happyroad
web platform will search through your Facebook and Twitter accounts to figure out what you
like the most and find optimal traveling routes. In this case, if you do not feel satisfied with your
traveling experiences, you might and are encouraged to write negative reviews. Based on your
feedback, happyroad will learn what you do not like, which will give us a better understanding of
what your traveling needs really are.
Following is a list of features in our happyroad mobile app. It is highly feasible that all of these
features will be included in happyroad when the app is launched by mid-June 2012.
Mobile Application Features
1. Facebook and Twitter integration.
2. User registration and login via Facebook and Twitter.
3. Share place and event check-ins on Facebook and Twitter.
4. Chat with Facebook friends while traveling.
5. Discover Facebook and Twitter friends on happyroad.
6. Explore popular and/or user defined places.
7. User preferences include (but are not restricted to):
a. Type of transportation (car, bike, public transit, walking, plane*).
b. Traveling time.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 8
c. Your age.
d. Who you travel with (friends, family, kids, pets).
e. Hotel/motel.
f. Pet services.
g. Gas stations.
h. Shopping malls.
i. Restaurants.
j. Events (music, sports, other shows).
k. Scenic routes and nature preserves.
l. Small town and village.
m. Historical places.
n. Cultural heritage sites.
o. Casting scenes of popular movies.
p. Deals.
8. Suggested places and events matching historical user preference data.
9. Suggested places and events for fulfilling spontaneous traveling desires.
10. Routes can be modified in map view with the swipe of your finger.
11. Sophisticated software keeps track of user preferences and community reviews.
12. Navigation and check-in tools.
13. Text and voice search.
14. Search results filters.
15. Publish routes and tour lists.
16. Public and private check-ins to places and events.
17. Earn points for checking into different places or events.
18. Post check-in photos, videos, tips, comments and reviews.
19. View check-in history.
20. Rate places for any number of travel preferences.
21. Earn points and trophies for checking into places and events.
22. User ranking system that starts new users out as high school graduates. As users move up in
rank by checking into more places, they become college freshmen, sophomores, juniors,
seniors, college graduates, state governors, and ultimately presidents.
23. The higher rank you are, the more discounts you can get.
24. The ranking system will increment on the following scale of points: 10-10-20-20-40-60-120.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 9
25. Users can use Facebook credits to rank up faster than non-paying users.
26. Users that check-in to previously unexplored areas automatic become presidents.
27. Rank titles are based on the country that happyroad is active in. For example, in the UK, we
use the term prime minister instead of president for the highest-ranking players.
28. Online coupon retail.
29. Get daily deals on products, services and events.
30. Places, deals and events listed by proximity to your current location.
31. View deals history.
32. View your profile statistics.
33. Keep track of your favorite businesses, merchants and venues.
34. Get directions to businesses or venues in map view.
35. List business phone numbers, addresses and websites.
36. View places and events in map view.
37. Social event planner.
38. Check-in early for events and concerts.
39. Prepare/prompt users to leave for events early and get discounts at other places before
making it to the main event.
40. Sponsors for music events. If a venue wants to get more people to come to their events, they
can pay us to advertise and list their event on happyroad.
41. Higher-ranking users get VIP deals for concerts and events.
42. Users pay real money for Facebook credits, which are virtual credits that allow them to pay
for virtual goods on happyroad.
43. Help users find things to do in certain neighborhoods given specific time frames. For
example, you have three hours in Times Square before your bus leaves for Boston;
happyroad suggests what to do and where to go.
44. Banner ads on website and mobile application.
*Note: Starting in year 3, traveling by airplane will be a type of preference that happyroad can offer
to our users.
Product Data Sheet
All the above features are built into happyroad using the technologies listed in the table below.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 10
Technology Description Feature
Java Platform SE
7
We use the Java Platform Standard Edition (SE) 7 to
develop happyroad services. The Java Platform includes
the Java Runtime Environment (JRE), which allows us to
run Java code on our computers. This platform also
includes the Java Development Kit (JDK), which allows us
to develop Java code on our laptops.
#1 - 44
Java Android
SDK*
Developers at happyroad use the Java Android Software
Development Kit (SDK) along with the Java Platform SE 7
to create the happyroad Android application. This program
runs on the Android Operating System (OS), which is
installed on many smartphones and tablets.
#1 - 44
iOS 5 SDK* Developers at happyroad use the iOS 5 SDK to create the
happyroad iOS application. This program runs on the
Apple iPhone, iPad, and iPod Touch.
#1 - 44
GPS Location
Data
Most smart phones use Global Positioning System (GPS)
satellites to triangulate the machine’s location in terms of
latitude and longitude coordinates. The Java Android SDK
and the iOS 5 SDK both provide methods for reading
location data from a device’s closest three satellites.
#3, 6 - 10, 12,
15, 16, 26, 27,
29, 30, 33, 34,
36, 38, 39, 43
MySQL Database We use a MySQL database on the internet to store data
used by the happyroad application.
#1 - 44
Website The happyroad application uses a website to transfer data
between a remote MySQL database on the internet and the
application itself.
#1 - 44
Facebook SDK
for Android*
Happyroad uses the Facebook SDK for Android to register
new users for the happyroad service. The service also
accesses data from a user’s Facebook account using this
SDK.
#1 - 5, 25
Facebook SDK
for iOS*
Happyroad uses the Facebook SDK for iOS to register new
users for the happyroad service. The service also accesses
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 11
data from a user’s Facebook account using this SDK.
Facebook Graph
API*
The new Facebook Graph Application Programming
Interface (API) provides access to data for users, events,
photos, videos, check-ins, friends, news feeds, profile
feeds, likes, permissions, video uploads, places and music.
#1 - 9, 15, 25,
30, 37 - 42
Camera Most smart phones have cameras that the Java Android
SDK and iOS 5 SDK make available for taking and
recording pictures and videos on the device.
#18
Voice
Recognition
The Java Android SDK and iOS 5 SDK provide methods
for recording sounds from a machine’s microphone and
translating these sounds into written text. The voice
recognition tools allow users to search for their destination
without having to type anything into the phone.
#13
Android Maps
API*
The Android Maps API allows the happyroad developers
to embed Google Maps into the happyroad Android
application.
#10, 12, 34,
36
Foursquare
Platform*
Happyroad allows users to link to their foursquare account,
which foursquare makes possible through its online
platform. The foursquare platform gives happyroad users
the power to discover places already listed on the extensive
databases available on foursquare.
#6 - 9, 16 -
19, 26, 28 -
31, 43
Twitter Platform* Happyroad uses the Twitter Platform for Android to
register new users for the happyroad service. The service
also accesses data from a user’s Twitter account using this
platform.
#1 - 5, 25
Google Places
API*
The Google Places API provides happyroad with access to
Google’s database of places all across the country.
#6 - 9, 26, 28
- 31, 43
Eventful Java
API*
Happyroad uses the Eventful Java API to search Eventful’s
database of events, concerts, and sports games throughout
the world.
#6 - 9, 29, 30,
37 - 41
Groupon API* The developers at happyroad use the Groupon API to find #7, 28 - 31
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 12
deals at local businesses near you.
Yelp API* The Yelp API allows happyroad to search for places and
reviews from the databases stored at Yelp.
#6 - 9, 26, 28
- 31, 43
Upcoming API* The Upcoming API allows happyroad to search for
concerts and events near you that are stored at Yahoo.
#6 - 9, 29, 30,
37 - 41
Aloqa Publisher
API*
The Aloqa Publisher API gives happyroad the ability to
access location-relevant content stored on Aloqa.
#6 - 9, 26, 28
- 31, 43
Yipit API* The happyroad application uses the Yipit API to find daily
deals near you.
#7, 28 - 31
OfferEngine
Platform*
The OfferEngine Platform allows happyroad to connect
offer providers like restaurants, spas, salons, plumbers, etc.
with an integrated inventory management system. This
makes it easy for us to provide these deals to the right
audiences.
#7, 28 - 31
Coupz API* The Coupz API gives happyroad the ability to access daily
deals from the top daily deals sites on the internet.
#7, 28 - 31
DailyDealWorks
Platform*
The DailyDealWorks Platform allows happyroad to run its
own daily deals channel that connects to Facebook and
Twitter.
#7, 28 - 31
8coupons API* Happyroad uses the 8coupons API to provide users with
daily deals available on 8coupons.com.
#7, 28 - 31
Wantsa Publisher
API*
Happyroad uses the Wantsa Publisher API to provide users
with daily deals available on wantsa.com.
#7, 28 - 31
Ordr.in API* The Ordr.in API gives happyroad the ability to retrieve
restaurant and menu data for ordering food at restaurants
listed on ordr.in.
#7 - 9
Tippr API* The Tippr API allows happyroad to access daily deals from
around the country.
#7, 28 - 31
MyDealBag API* The MyDealBag API allows happyroad to access daily
deals from around the country.
#7, 28 - 31
BuyDeals.in API* The BuyDeals.in API allows happyroad to access daily #7, 28 - 31
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 13
deals from around the country.
AdMob SDK*, ** Happyroad uses the AdMob SDK to place mobile
advertisements on the app.
#44
MobFox API*, ** Happyroad uses the MobFox API to place mobile
advertisements on the app.
#44
AdSense** The happyroad website uses AdSense to display banner
advertisements.
#44
AdBrite** The happyroad website uses AdBrite to display banner
advertisements.
#44
*Note: Our technical experts can learn API development skills on a 1 to 2 week basis per API.
**Note: We use multiple ad networks to ensure that ads always show up when requested from
the network. This is because we lose revenue if ads do not show up on our application.
Happyroad, with all the given features above, has its own strengths and weaknesses, which
differentiate our product from our competitors’ services. Detailed information in this area is
provided in the Differentiator section.
Website Application
The happyroad website application uses the same features as the mobile application, but is
accessible to users from any Internet source, regardless of hardware. Also, as found in the
product data sheet for the mobile application, the website provides the mobile application access
to our MySQL database. Lastly, starting in year 2, the website application will include a
merchandising store.
Social Media
Facebook and Twitter provide happyroad with important communication tools for reaching out
to our audience. Also, because both services provide us with detailed information about our
users, we have a much better chance at advertising to our audience through these platforms. Not
to mention, both services provide happyroad with a user registration system, which saves us
development time.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 14
Target Market
Our product is designed for smartphone users who have the desire to maximize their traveling
experiences. We especially target people who want to travel by car over 50 miles or more for
leisure purposes. The reason that we focus on customers traveling over a long distance is to
differentiate us from our competitors, which include (but are not limited to) Foursquare, Yelp,
LivingSocial and Groupon. These four mobile applications can only provide information for its
customers within a maximum radius of 50 miles. The only competitor who can give users routes
to travel in long distances is Google Maps. However, we are confident that happyroad offers
many features that Google Maps lacks; more information can be found in the Differentiator
section.
The reason that we target car drivers is that the automobile is the main means of transportation
used by leisure travelers (76% according to the US Travel Association). Due to the fact that the
airplane is the second most popular means of transportation used by visitors, we plan to
introduce traveling by plane as one of the transportation preferences for happyroad in year 3.
In terms of the age of our target audience, after collecting data from various sources, we have
come to the conclusion that it can vary from people in the 20s all the way to people in their 60s.
Following is our figures of travelers’ age based on information from US Travel Association.
From the above figures, we can see that 31-47 year-old travelers make up the largest percentage
of the US leisure travelers (31%), while travelers age 47 or older have the most leisure trips per
year (4.1-4.4). Travelers younger than 31 years old make up the smallest percentage of US
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 15
leisure travelers (12%) and have the fewest trips per year (3.9). Based on these numbers, it looks
like the elderly are our target audience.
However, by looking at the main audience of our competitors, it is clear that people ages 18-34
contribute to most of their customer bases. Since Foursquare, Yelp and Google Maps have many
of the same features as happyroad, it is likely that we will have the same target audience as them.
In short, after looking at data from the US Travel Association and our competitors, we feel that
the age of our target audience ranges all the way from 20 to 60.
As we predicted, very little information about the income range, race, and level of education for
our target audience could be found online. After all, it makes sense that the interest in traveling
for fun does not necessarily depend on your age, income, race, or level of education. As long as
you have a smartphone, and you like traveling, we will come to you.
According to eMarketer predictions, there will be around 106 million smartphone users in the US
in 2012 (see Industry Analysis for details). Among them, there are 44 million Android users
(41.8%) and 29 millions iPhone users (27%); the total is 73 million people. This is a huge
number, which means if we can get only a tiny portion of the market in the first year, like 0.01%,
we already have 7,300 users, which is a success for a small start-up.
Industry Analysis
Mobile Application
The mobile app industry is growing faster than ever due to the increasing number of smartphone
users and the increasing rate of smartphone users downloading apps. According to eMarketer
data in August 2011, the number of smartphone users in the US was 60.2 million at the end of
2010, which was 19.4% of the US population at the time. These numbers are estimated to
increase to 90.1 million (28.8% of the US population) by the end of 2011, and 148.6 million
(45.6% of the population) by 2015. (See graph below).
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 16
In this ever-growing market, Android leads the market share at 41.8%, while iPhone platform
has 27%, BlackBerry 21.7%, Microsoft 5.7% and Symbian 1.9%. (Inman News, 2011).
Android and iPhone platforms are the two biggest players in the market, and they are expected to
increase their market share in the future.
The number of smartphone users downloading apps, according to a survey by the Pew Research
Center's Internet & American Life Project released in November 2011, has almost doubled in
two years: from 22% in September 2009 to 38% in August 2011, (Andy Vuong, 2011).
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 17
Among smartphone users, iPhone and Android users “have the most apps and use them the
most,” (The Nielsen Company, 2011).
All the above data, together with the low barrier of entry, and low start-up cost, indicates that
there are great opportunities for smartphone developers in the iPhone and Android app markets,
which justifies our strategy to penetrate into these markets in the first year, before trying other
platforms like BlackBerry or Microsoft.
Website Application
Additionally, happyroad is positioned to take advantage of the current and future trend in the
Internet industry: Web 3.0. This fledgling industry was preceded by the first two generations of
Internet sites: Web 1.0, which provides surfers with fixed information that users cannot be
modify by users on the web, and Web 2.0, which allows users to add and share content to
websites. Web 3.0 personalizes the Internet based on users’ preferences, and it takes advantage
of cloud computing and sophisticated artificial intelligence algorithms to solve complex
problems for users on the Internet. In doing so, this new version of the Internet will act as a
personal assistant to its users. For our company, we act as a personal travel agent for all of our
users. Happyroad is produced to help users navigate to a final destination based on their own
preferences, and therefore, exemplifies the Web 3.0 generation of Internet technologies.
Social Media
Undeniably, social media sites like Facebook and Twitter have been booming at significant rates.
According to a study by web analytics website Social Bakers, in September 2011 there were 750
million Facebook users, as well as 100 million Twitter users with an 80% increase in tweets
since January 2011. The analytics site also projects that Facebook should have 1 billion users by
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 18
2012. A statistic from TechCocktail.com states that in September 2011 there were 800 million
active users on Facebook, 100 million active users on Twitter and 43 million active users on
Google+. The same website also suggests there were 490 million active users on YouTube in
February 2011.
Our integration with the most popular social media sites, which is demonstrated by our Facebook
page, Twitter account, and Google + page, will help the company advertise our product, connect
with customers, get feedback from them, and most importantly, increase our user base.
Online Coupon Retail
After conducting extensive research, we have come to two main conclusions about the online
coupon retail industry, which is represented by two major players: Groupon and LivingSocial.
The first conclusion is that it is unclear whether the industry will be growing in the future, after
witnessing boom in the previous years.
According to PC World report in September 2011, there is “no evidence of daily deal fatigues;
only 16.7% of the US population has done a deal, [which means that there is a good opportunity]
for trail and use of daily deals by current non-users.”
Additionally, in a report released in January 2012, Daily Deal Media, a reliable news,
information and data resource for the industry, stated that after taking surveys of companies
using daily deal services in 2011, 35% of them reported their deal offerings were profitable, with
merchants indicating satisfaction in deal programs increasing by 17% between June and
December 2011,” (PR Newswire).
On the other hand, there are signs that indicate bad performance for the industry in the future. In
August 2011, the Atlantic Wire reported that 52% of daily deal users in the US felt frustrated by
the number of emails they receive about deals, and 60% of people surveyed felt that this industry
is too crowded. In July 2011, Groupon and LivingSocial’s unique visits fell 8.9% and 28%,
respectively.
All websites used for collecting industry data agree on our second main conclusion; which is that
the daily deals industry is worse for small startup companies than for larger ones. Large-scale
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 19
consolidation begins to occur, resulting in a lot of difficulty and huge competition for small
players. They are forced to be acquired or exit altogether, and the barrier to entry becomes very
high.
As a small company entering into this high-risk industry, happyroad is ready to deal with these
challenges. Due to the instability of the industry and the intense rivalry among competitors, we
decide not to focus our business on online coupon retail. In addition, our product is designed to
specifically help users travel in long distance of 50 miles or more rather than to offer them daily
deals. Daily Deals is just a small addition to our product instead of a main feature. If there are
deals en route to where you are going and you prefer to check in where deals are offered, we will
show them to you. Happyroad never ever sends daily emails to promote daily deals. We would
rather not generate a lot of revenues from the online coupon retail than lose our customers after
spamming them with daily deal emails.
Competitor Analysis
Financial Information
Due to the fact that Foursquare, Yelp and LivingSocial are privately held companies, that
Groupon just went public in November 2011, and that Google Maps is just a product of Google
rather than a company, we were not able to find out as much financial information as we would
have liked about our competitors. The two tables below contain financial data for Yelp and
Groupon from Hoovers, a business analytics website. The growth rates of Yelp and Groupon in
terms of revenues are extremely high, especially for the latter, whose revenues increased by
4809% from December 2009 to 2010.
Yelp Financials Dec 2008 Dec 2009 Dec 2010
Revenues $12.14 M $25.81 M $47.33 M
Increase in revenues (%) N/A 112% 83%
Net income (5.81) (2.31) (9.57)
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 20
Groupon Financial Dec 2008 Dec 2009 Dec 2010
Revenues 0.94 14.54 713.37
Increase in revenues (%) N/A 1446% 4806%
Net income (1.54) (1.34) (389.64)
Number of employees N/A 150 6,600
Customer Base
Another data that we collected was Foursquare customer base: from 300,000 regular users in
year one goes up to around 700,000 in year two, and 2 million in year three.
Competitor Foursquare Groupon LivingSocial Yelp Google
Maps*
Klout Score** 98 67 75 59 71
Alexa Rank*** 796 264 525 190 1
Regular users (Mobile
app and Website)
2,000,000 31,000 68,000 9,000 32,000
Internet users that visit
Site
0.15% 0.50% 0.20% 0.60% 47%
Time on Site (min) 4.0 3.0 3.5 4.0 12.0
Gender Female Female Female Female Both
Age Range 25 - 34 25 - 34 25 - 34 25 - 34 18 - 54
Undergraduate Education Yes Yes Yes Yes Yes
Graduate Education Yes No No No Yes
Income Range $60K -
$100K
$60K -
$100K+
$60K -
$100K+
$60K -
$100K+
$0 -
$100K+
*Note: Data for Google Maps more accurately reflects influence Google itself has on the
Internet.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 21
**Note: Klout scores are higher for more popular sites. Klout measures a website’s influence
across social networks online.
***Note: Alexa traffic ranks start with most viewed website as rank #1. Alexa collects data on
Internet browsing behavior, which it uses to create web traffic reports.
Features
Due to the fact that we do not intend to get too involved in the daily deal market, we are not
considering LivingSocial or Groupon as our direct competitors. Therefore, we feel it necessary to list
only features of Foursquare, Yelp and Google Maps in the following comparisons.
Features that Foursquare, Yelp and Google Maps offer:
• Check-in with comments and reviews.
• Find friends who use the service.
• Text and voice search.
• Explore based on coffee.
• View your profile statistics.
Features that Foursquare and Yelp offer:
• Get daily deals on products and services.
• Places and deals are listed based on current location.
• Check-in with photos and tips.
• View check-in and deals history.
• In-game points, badges, mayorships and dukedoms.
• Connect with friends.
• Recommended and trending exploration.
• Explore based on specials.
Features that Foursquare and Google Maps offer: • Find where your friends are on the map.
Features that Yelp and Google Maps offer:
• Explore based on restaurants, tea, gas/service stations and bars.
• Filter search results.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 22
Features that only Foursquare offers:
• Facebook user login.
• Connects to Facebook and Twitter.
• Private sharing of check-ins.
• Explore based on nightlife, food and shops.
• Suggested places in list format.
• View check-in statistics in real-time for specific places and events.
Features that only Yelp offers:
• Lists business websites.
• Custom user login.
• Explore based on drugstores.
• Keep track of your favorite businesses.
• View business locations from the camera view.
Features that only Google Maps offers:
• Explore based on ATMs, banks and attractions.
• Get directions to businesses in list format.
• View location history.
• Show traffic, satellite image, terrain, transit lines, Wikipedia links, parking, etc. on maps.
• View saved maps.
• View maps for bicycling and walking.
• Avoid highways and tolls.
• Search for alternative routes.
• En route voice directions.
• Street view.
• Car dock mode.
• Search along route.
Product Differentiator
To illustrate unique characteristics of happyroad that differentiate us from all other competitors,
we have made some comparisons with our competitors Foursquare, Yelp, Google Maps,
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 23
LivingSocial and Groupon.
Main Feature Foursquare Yelp Google
Maps
LivingSocial Groupon happyroad
Maximum area of
searching
10 miles 25 miles Indefinite 50 miles 50 miles 1st year: 3000
miles (across
the US).
Years after:
international
expansion
Show businesses
locations and how
to get there
✔ ✔ ✔ ✔ ✔ ✔
Include event
information while
planning for trips
✔
In-game features ✔ ✔ ✔
Figure out cool
places/events en
route to a
destination
hundreds or
thousands miles
from you
✔ ✔
Leverage user’s
preferences to find
the best
combination of
places en route
✔
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 24
Looking at the table above, we can see that when using our competitors’ products there is good
chance users will miss fascinating events en route to their destinations. By using various events
features, happyroad finds concerts, parties, festivals and more going on anywhere from a mile to
1000 miles from the user next month. The happyroad application provides users with personal
assistance for long distance road trips. Since our mobile application is part of the web 3.0 trends
on the Internet, we provide users with assistance very similar to what travel agents do. What’s
more, our mobile app learns much more about each user and knows everything they love to do.
Happyroad will navigate users to awesome and exciting places and events en route to their
destination. As is depicted below on the left, without happyroad users can travel via Yelp,
Foursquare, and Google Maps, which provide the user with a direct route from Fremont to Los
Angeles, California.
Without happyroad
With happyroad
Due to happyroad’s ability to search for cool places hundreds or thousands of miles from the
starting point and its event planning features, you will not miss any fascinating places or events
on the way to your desired destination. As you can see above on the right, on the way to Los
Angeles, this user, who enjoys discovering natural scenery, has gone to a hiking trail near the
Yosemite National Park, gorges near Porterville, and a public beach near Simi Valley.
2/7/12 24 Hour Fitness to Magnolia Blvd, Burbank, CA - Google Maps
1/2maps.google.com/maps?f=d&source=s_d&saddr=Paseo+Padre+Pkwy,+Fremont,+CA&daddr=1921+…
Directions to Magnolia Blvd, Burbank, CA346 mi – about 5 hours 53 mins 2/4/12 Paseo Padre Pkwy, Fremont, CA to 1921 Magnolia Blvd, Burbank, CA 91506 - Google Maps
1/6maps.google.com/maps?f=d&source=s_d&saddr=Paseo+Padre+Pkwy,+Fremont,+CA&daddr=CA-4+E…
Directions to 1921 Magnolia Blvd, Burbank, CA 91506954 mi – about 20 hours 25 mins
Loading...
©2012 Google - Map data ©2012 Google, INEGI -
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 25
Remember that happyroad allows users to specify the time they want to spend on their journey.
Our example user can tell happyroad that he or she wants to spend 26 hours traveling, and
happyroad will give the user an optimal itinerary so that he or she can get from Fremont to Los
Angeles in 26 hours and have tons of fun.
Additionally, although daily deal searching is not a main feature of our product, it will be helpful
for users. Happyroad accesses deals from all areas within the reach of Groupon and
LivingSocial. Instead of focusing on deals from just one city, we offer great deals from hundreds
of cities hundreds of miles away. Unlike Groupon and LivingSocial, happyroad never emails
you about the deals we find. You can enjoy the peace of mind, knowing that you save yourself
the hassle of sorting through hundreds of emails for daily deals you never wanted in the first
place.
Besides the many great features that it has, happyroad helps you satisfy the true desires and
needs for traveling: getting there is half the fun! Whether you are exploring the world around
you, looking for exciting and unusual experiences, or you’re taking a vacation with your family,
happyroad will maximize your traveling experience.
In a world filled with subways and airplanes, where everyone rushes to work, and forgets about
enjoying the ride, this app makes a difference. Happyroad will be the first thing that people go to
when they plan for traveling. It will change the way that people travel, and we believe it will
change the world.
Marketing and Sales Plan
Marketing Plan
Our marketing strategy revolves around the message that we want to deliver to our smartphone
users: happyroad will maximize your traveling experience. The purpose of this slogan is to
distinguish our company from other competitors and to help customers quickly decide whether
happyroad represents an appropriate option for their needs and desires.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 26
Additionally, our strategy contains four essential elements in marketing our product and
business: product, price, place and promotion. Detailed information about our product is
provided under the Product Description and Differentiator sections. Our pricing plan will be
value-based. With our slogan and ultimate goal to maximize your traveling experience, we are
committed to giving smartphone users a high-quality smartphone app that brings them enjoyable
moments while traveling, and therefore, increases their living standards.
We strive to give customers good value by maintaining close relationship with them and
understanding their needs and demands. As a result, customers will be more than happy to use
and pay for our product (the non-ad version of happyroad). On the other hand, our pricing
strategy allows users to pay for our premium non-ad version of happyroad, which will cost users
$0.99 in the first two years and $2.99 starting in year three in smartphone app market places.
More information about our pricing for ads is provided in the Financials sections.
As for the place element of our marketing plan, smartphone users can easily access our website
or download our happyroad app for free from their smartphones. We will have a non-ad version
of happyroad available for a small fee, which users will have to pay to download. For
businesses, another group of potential customers, they can access us through the company’s
website or phone numbers to ask about advertising slots on our website and mobile apps.
Promoting happyroad will require a lot of advertising. We will focus on our target audience and
will reach out to them through intensive marketing campaigns. Additionally, since user base is
fundamental in driving the success of our company, we will spend a great amount of efforts and
resources in the advertising campaign.
Our promoting methods we will implement in the first year include word of mouth, social media,
college radio commercials, and paper ads. Word of mouth and social media are great marketing
tools since they’re both free. We could use on-site blog posts to freely advertise to people who
like our page on Facebook, Twitter and Google+. Uploading YouTube videos and ads that the
CTO produces via computer graphics software could make happyroad go viral. And we can post
video interviews of smartphone users about experiences they had using our product to YouTube
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 27
free of charge. We will focus our videos on users who have had an enjoyable time traveling
through natural scenery in remote places, rather than businesses in urban areas. They will not
only inform our customers about new locations to discover, but they’ll also encourage people’s
interaction with and desire to explore the environment around them. Given current camera
technologies on smart phones and available from public sources, these YouTube videos will cost
nothing. College radio commercials should be free, too. Printing paper ads should cost us
$1,253.62 for 10,000 sheets. We could go to a thousand different colleges and place 10 paper ads
around campus or at the local bars.
In year two and year three, we will continue using these methods but at a much larger scale.
While specific advertising campaign for each year depends on the company’s speed of
development, we estimate that since year four, we will have enough employees and resources to
expand our advertising campaign by using city broad banners, radio and TV commercials, etc.
Sales Plan
According to eMarketer, in 2012, there will be around 73 million users for iPhone and Android.
We expect that we will capture 0.0041% of this market, so that in the first year, we will have
around 3,000 daily active users (dau), which is about 1% of the number of dau Foursquare has in
its first year (2009).
By benchmarking against Foursquare, we expect that the number of our dau will increase 70%
and 110% in year two and three; these numbers are lower than Foursquare’s.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 28
Looking at the table, you can see that the percentages of our dau who pay for gaming, shop at
our online store, pay for our premium version app, or use online coupons decreases over the
years, although the number of actual users engaging in these activities increases. The reason is
that, according to the diffusion of innovations theory, our customers in the first year are the
innovators and the early adopters, who are very interested in our product and are willing to pay
for it. Since the second year, our new users are the early/late majority, who are less interested in
happyroad and less willing to pay for it, compared to the early adopters. Therefore, the
percentages previously mentioned will decrease.
Financials
Among the five areas of gaming, business advertisements, online store, our premium non-ad
version of happyroad, and online coupon retail, gaming generates the most revenues. Based on
the experience of our CTO as an online gamer and his understanding of the online gaming
features, we estimate that on average, a regular user of the gaming features pays about $20/year,
or $1.67/month. This number times the number of happyroad dau times the percentage of happy
dau who pays for gaming features equals the gaming revenues.
In terms of revenues from the online store, premium non-ad version, and online coupon retail, we
calculate 𝑟𝑒𝑣𝑒𝑛𝑢𝑒𝑠 = # 𝑜𝑓 𝑑𝑎𝑢 ∙% 𝑜𝑓 𝑑𝑎𝑢 𝑝𝑎𝑦𝑖𝑛𝑔 ∙ ℎ𝑜𝑤 𝑚𝑢𝑐ℎ 1 𝑑𝑎𝑢 𝑝𝑎𝑦𝑠 𝑝𝑒𝑟 𝑦𝑒𝑎𝑟. For
the online store, since we will offer new merchandise every year, it is expected that a regular
user will spend more each year. As a result, the profit earned per regular user increases over
years, from $5 in year one to $11 and $14 in year two and three, respectively.
The same situation applies for the online coupon area, where each regular user is expected to
bring us more profit over years, since we will expand our product variety over time. The profit
earned per regular user will be around $20, $24 and $26 in year one, two and three, respectively.
Revenues from the non-ad version will increase dramatically between year two and three, since
in the first two years, we offer the 99 cent version, while in year three, we will replace it by the
$2.99 one.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 29
A crucial part of our revenues comes from paid business advertisements on our mobile app and
websites. We’ve found a few critical data that help us compute revenues based on the number of
daily active users and thousands of impressions per day. According to AdMob, you can figure
on making $0.25 for every one 30-second banner impression. For 50,000 impressions on our
website, we will get around 250 clicks, or about $7-$10 per day. The most important thing
overall is the popularity of the app. If we get a million impressions a day we’ll earn profit
irrespective of factors like the fill-rate or where users come from. For a million impressions or
5000 clicks, happyroad can make $140 to $200 daily. Also, we should make about four times
this much since we’ll have ads on multiple phone applications as well as our website.
After consulting with a mobile app expert from MobFox, we have made sure that the above
information and estimations are correct. After that, we produced the following chart of data for
calculating yearly revenues per daily active user.
Below is the graph that applies to Mobile and Website advertisements. The data comes from a
minimum of $0.30 CPM/CPC and a maximum of $5 CPM/CPC. CPM means cost per mille, which
measures the cost of advertisements per 1000 impressions. Impressions of ads are when the ads
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 30
display on the website or mobile application. CPC means cost per click, which measures the cost
of advertisements for every time a user clicks the ad.
Based on the two graphs for yearly revenues per daily active users and cost for advertisements,
as well as data collected from other sources, we compute the following Income Statement for
year 1, year 2 and year 3. For each area, we include the minimum, average, and maximum
number, which indicates the most likely (average) scenario, worst, and best case scenario,
respectively.
Most likely Scenario Year 1 Year 2 Year 3
Revenues
Gaming $19,500 $26,000 $49,000
Business advertising $10,500 $14,500 $25,000
Online store $1,500 $5,000 $12,000
Online coupon retail $1,200 $1,800 $2,800
Premium paid version $594 $909 $4,826
Total revenues $33,294 $48,029 $93,626
Percentage Increase N/A 45% 95%
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 31
Expenses
Start-up costs $575 $475 $475
Mobile Ads $2,500 $5,000 $12,000
Social media $5,000 $10,000 $20,000
Paper ads $1,253 $1,253 $1,253
Salary* $22,000 $25,000 $38,000
Others $600 $900 $1,200
Total expenses $31,928 $42,628 $72,928
Operating Income $1,366 $5,581 $20,698
Taxes $2,330 $3,375 $6,554
Net Income ($964) $2,206 $14,144
Worst Scenario** Year 1 Year 2 Year 3
Revenues
Gaming $16,575 $22,100 $41,650
Business advertising $8,840 $12,325 $21,249
Online store $1,274 $4,250 $10,200
Online coupon retail $1,020 $1,530 $2,380
Premium paid version $379 $643 $4,102
Total revenues $28,088 $40,848 $79,581
Percentage Increase N/A 45% 95%
Expenses
Start-up costs $575 $475 $475
Mobile Ads $2,109 $3,252 $10,200
Social media $4,218 $6,505 $17,000
Paper ads $1,253 $1,253 $1,253
Salary* $22,000 $25,000 $38,000
Others $600 $900 $1,200
Total expenses $30,755 $37,385 $68,128
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 32
Operating Income ($2,667) $3,463 $11,453
Taxes $1,966 $2,859 $5,571
Net Income ($4,633) $604 $5,882
Best Scenario** Year 1 Year 2 Year 3
Revenues
Gaming $25,350 $33,800 $63,700
Business advertising $13,650 $18,850 $32,500
Online store $1,950 $6,500 $15,600
Online coupon retail $1,560 $2,340 $3,640
Premium paid version $580 $984 $6,274
Total revenues $43,090 $62,474 $121,714
Percentage Increase N/A 45% 95%
Expenses
Start-up costs $575 $475 $475
Mobile Ads $3,250 $6,500 $15,600
Social media $6,500 $13,000 $26,000
Paper ads $1,253 $1,253 $1,253
Salary* $22,000 $25,000 $38,000
Others $600 $900 $1,200
Total expenses $34,178 $47,128 $82,258
Operating Income $8,912 $15,346 $39,186
Taxes $3,016 $4,373 $8,520
Net Income $5,896 $10,973 $30,666
*Note: Detailed information of salary is provided in the Company Structure section.
**We assume that our company’s revenues in the worst scenario is 77-83% of our revenues in the
most likely scenario, and our revenues in the most likely scenario is also about 77-83% of our
revenues in the best scenario.
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 33
Start-‐Up Fund
Capital investment will come from two co-Founders as well as investors. The company’s owners are
able to invest $15,000 to $20,000. We have talked to relatives and friends, and there is a possibility
that we will get around $5,000. Since the expenses for year one is $30,000 to $35,000, we will need
$25,000-$30,000 investment from our investors. This is the minimum amount of investment we need
to cover expenses for the first three years.
Let’s consider the worst case, the case in which we make the least amount of profit, to understand
why we need around $30,000 investment. We will have $20,000 to $25,000 to start our company.
Although the start-up cost is only around $500 to $600, we would need a total of $30,000 invested to
cover expenses in year one in order to gain at least $28,000 for revenues, which means that we can
use $28,000 to cover expenses for year two. Expenses in year two are about $37,000, with $25,000
for salary. Remember that salary and other investors. The company is in the process of looking for
these investors. Also, looking at our projected income statement, we can see that if the worst
situation takes place (very unlikely), we will have a loss of $10,000 small expenses are paid over
many periods throughout the year, which means that with $28,000 we will cover expenses for the
first 9 months. During this nine-month period, we generate revenues of about $28,000, which is
more than enough to cover expenses for the last 3 months of year two.
At the beginning of year three, we have $28,600 in cash, which is enough to cover expenses for the
first 5 months. Like the situation in year two, during this 5 month period in year three, we are
able to generate enough revenues to cover expenses for the remaining time of the year. Only
$20,000 is not enough to cover the yearly expense in year 2, which is around $40,000. Through our
connections, we will try to get new investors for this part there is a high possibility that we can get
the fund we need, since at this time, we have already had a solid customer base (around 1,500 daily
active users), and starting in year 3, we will definitely make profit. In short, with $25,000 to
$30,000 from investors, we are able to cover expenses for the first three years, even in the worst
case. The situation will be much better if we are in the most likely or the best scenario.
In short, due to the nature of the data, which is distributed in a positive slope skew that peaks
between one and two standard deviations from the mean. In another word, the probability for the
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 34
data to fall below the actual mean is typically above average. As a result, while the financial results
vary considerably from years to years: from having around $20,000 loss to making $110,000 profit
for the first two years’ total, the possibility that the worst scenario happens is extremely small (less
than 0.01%). Also note that we are very conservative while computing all the data. However, no
matter how much the results might vary, we can make profit even in the worst case. It is highly
feasible that happyroad will be a successful start-up, and that our investors will start making
profit in the third year. The income statements and our funding strategy have shown us that the
success of happyroad is highly feasible.
Company Structure
As a Business major and Economics minor, the CEO and co-founder, whose salary is $500, Minh
Uong, is in charge of business-relating areas, which include, but are not limited to marketing and
sales plans, financials, administration, and human resources. He will work with merchants/venue
owners available on happyroad.
As a Computer Science major, the CTO and co-founder, Adam Steinberger, whose salary is $500,
takes responsibility for technology, product, research and development, and customer service. The
CTO will write the skeletal software structure for our mobile application, research the SDKs,
Platforms and APIs required for mobile development, design flow-charts, mind-maps and pseudo-
code for machine learning and artificial intelligence algorithms, keep engineers on scrum schedule so
new software ships on a biweekly basis, and ensure the development team can correctly write
software that meets the goals of our larger ideas while functioning fully on the microscopic level. In
other words, the CTO will help the engineers to create a software platform for happyroad.
Following the co-founders are the employees that our company intends to hire, from year one to year
three. Based on our customer base, customers’ demand and other aspects relating to the company’s
development, we will adjust our plan.
In year one, the testing engineer, whose salary is $10,000/year*, has the responsibility to keep track
of quality control and to write unit test software that purposely breaks own code so we can find bugs
and fix them fast. The mobile engineer, whose salary is also $10,000/year*, makes sure that the
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 35
company is heading in the correct direction given the technology available and ensures rapid
shipping of software updates given the vast number of APIs used in developing the happyroad
mobile application. A part-time distributor, whose salary is $1,000*, will pick up and distribute
merchandising and marketing items that we order.
In year 2, besides what he has already done in the first year, the part-time distributor will distribute
our happyroad merchandise to customers when they order it from the online store. Also, since we
will introduce happyroad to Mexico and Canada, we will need to hire 2 translators, whose salary is
$1,500 each*, to help us convert our product into the Mexican and French versions.
In year 3, when we introduce airplanes as a new preference for traveling, our mobile engineer will
get a raise due to the work involved in this development. His new salary will be $17,000/year*. Since we will introduce happyroad to Europe, we will need to hire four more translators, whose
salary is $1,500 each*, to help us convert our product into versions in different languages.
*Note: As compensation for their low salary, our employees are offered certain amount of stocks of
happyroad.
Risks Evaluation Risk consideration is a very important step that any company should take. Following are threats
from the industry and weaknesses of our company. While we will try our best to minimize the
negative influence of those factors, it is undeniable that they might affect the development of
happyroad.
Threats
Intense Competition
The data that we have collected shows the significant development of our competitors, who are
all the biggest giants in their areas. Our company is aware that there will be a lot of difficulty for
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 36
a small start-up like happyroad. The company will have to find its own place in such an intense
competition.
Legal Requirements
While selecting features for our smartphone app, we have done research and comparison to make
sure that we do not infringe upon intellectual property rights. However, since many in-game and
check-in features included in happyroad are similar to those of Foursquare and Yelp, these two
companies might file lawsuits for our actions. We have considered the possibility that we might
have to modify our product by using alternative features. If such a legal problem happens,
besides the fact that alternative features might not be as interesting as the optimum, it will take a
while for the company to create new features. Additionally, legal problems will seriously affect
happyroad’s reputation. However, our company doubts that any lawsuits from these companies
will come to fruition. We will hire lawyers just as a protective barrier in case something comes
up, but again we doubt we will have any problems here.
Weaknesses
Since both co-Founders are still college students and have never run a business, we do not have
as much experience and professional connections as managing directors of other companies.
Although we are very passionate students who have a good understanding of the business and
computer science fields, our experience and knowledge cannot compare to those who have
worked in the industry for a considerable period of time.
Another weakness of happyroad is that our company is a small start-up with limited capital
investment. This will inevitably result in difficulties while planning for our advertising
campaign as well as other expansion.
Despite all the above threatens and weaknesses, we have high confidence that with our vision,
our passion, the steps we have already taken, and the improvement we will make in the future,
we are ready to deal with all challenges. We strongly believe and have had concrete evidence
HAPPYROAD: A BUSINESS PLAN BY UONG AND STEINBERGER 37
that we will establish a solid user base in the market, and will make significant development for
happyroad.
Legal Requirements
Some legal aspects that we have considered include business, advertisements, intellectual
property rights and cyber attacks. Advertisements on our smartphone application and website
will be family friendly, otherwise there might be some legal conflicts due to the fact that parents
do not want their children to see adult content on their cellphones. Since happyroad includes
some similar features with Foursquare and Yelp, we will go through the process to make sure
that our product does not violate any intellectual property. Directed Denial of Service (DDoS)
attacks are also a huge concern for happyroad. By using the plethora of APIs available from our
potential partners, these partners are at risk of accidental DDoS attacks from our users making
too many information requests to each partner service. More information regarding legal
requirements will be available soon, as our company will conduct more researches as well as
consult with our lawyer.
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