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Daily physical activity as a part of your social media experience. Table of Contents. Investment Opportunity in Brief Business Concept and Earnings Logic Market and Competition Financial Targets Action Plan Technology Status and IPR Portfolio Management and Board

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slide1

Daily physical activity as a part

of your social media experience

slide2

Table of Contents

  • Investment Opportunity in Brief
  • Business Concept and Earnings Logic
  • Market and Competition
  • Financial Targets
  • Action Plan
  • Technology Status and IPR Portfolio
  • Management and Board
  • Investment Terms and Schedule
  • Appendices
    • Current Shareholders
slide4

Hookie – Investment Opportunity in Brief (1/3)

General Information

End User Offering

Hookie is an early stage mobile / internet services company with two years extensive product development in physical activity monitoring.

The company has developed a highly scalable mobile phone based activity information service which connects consumers, consumer brands and service providers in social media. The service enables automatic physical activity monitoring without any additional gadgets or user turn on/off, utilizing built-in acceleration sensors of mobile phones.

The company’s head office is located in Espoo, Finland and the company’s shareholders consist of VTT Ventures, management and angel investors.

  • Hookie offers a mobile phone based wellness service connected to Facebook.
  • The user gets for free
  • Personal physical activity data (currently walking, running, cycling, calories) to Facebook just by carrying a mobile phone.
  • Fun, benefits and rewards based on activity

Competition

  • There are currently several companies active in the field of activity monitoring. Examples:
  • Sports Tracker
  • S2H.com
  • Fitbit
  • Nike+
  • However, there are no companies having the same business approach or similar mobile technology.
  • Hookieis also the only company in the marketplace that can identify the user by acceleration data.

Key TeamMembers

  • CEO HannuPuolitaival
  • CTO OtsoKivekäs
slide5

Hookie – Investment Opportunity in Brief (2/3)

EarningsLogic

Key IPRs

  • Hookie’s revenue generation potential is linked to number of users. Hookie sells
  • Targeted marketing channel in social media for consumer brands
  • The number of Hookie users is the critical success factor for revenue development
  • Additional Earnings Potential
  • Licensing of technology / algorithms for other environments (Q1 2012 ). Ongoing negotiations with NTT Docomo, Samsung
  • Royalties from activity meter based analysis and corporate wellness service. This is based on the business Hookie sold (MBO)at the end of 2011.
  • IPRs for the automatic person and activity identification offers additional revenue generation potential through licensing / sales (not included in current business plan)
  • The company has exclusive rights to use of patents currently owned by VTT in the field of
  • Automatic person identification
  • Automatic activity type recognition
  • Context recognition in mobile devices

Financial Targets

YearRevenue EBIT

2012 402 K € - 404 K €

2013 2,60 M € 1,0 M €

2014 5,25 M € 2,4 M €

2015 14,40 M € 10,0 M €

slide6

Hookie – Investment Opportunity in Brief (3/3)

FinancingNeed

  • Costs
    • The company planned cost base until end of 2012 consists of
  • R&D ca 243.000 €
    • Facebook application / mobile client development
    • Cloud server features finalization
    • Activity recognition development (skiing, golf, other)
    • “Learning technology” development
  • Marketing & Sales ca 160.000 €
    • Launch of the FB service
    • Seeding & customer acquisition in FB
    • Expansion in Europe
  • Personnel Costs, Admin + Other ca 311.000 €
    • 1 full time + 2 half time currently
    • 3 full time immediately when financing secured
    • 7 full time by end of 2012
    • 10 full time by April 2013
  • Revenues
    • Estimated revenues during 2012 after completion
    • of this financing round are 402.000 €
      • Consumer brand marketing 312.000 €
      • Licensing revenue 50.000 €
      • Royalties revenue 40.000 €

InvestmentOpportunity

  • Hookie is seeking 750.000 € in new equity financing, transaction to be closed in Q1 2012
  • 150.000 € new equity financing secured from VTT Ventures, conditional to min. 250.000 € from other investors
  • Pre-money equity valuation 1.800.000 €
  • A successful completion of the financing round secures proceeding according to business plan until end of2013.
slide8

The problem

Access to everyday activity information of the masses.

slide9

Activity information

Highly scalable solution

Mobile phone gathers the daily activity

Activity information as a part

of social media experience

Hookie application analysis the accelerometer

data of the mobile phone and provides holistic activity information:

- User identification based on walking style

- Amount of walking, running, biking etc.

- Calories consumption etc.

Service in social media includes gamified activity challenges on personal and group level with strong peer and social elements.

slide12

Target group

Females 30+ of age:

• Biggest group of social game players

(UK average is female 42 years)

• Decision maker in households

• Interested of their own wellbeing and health

• Strong social networks and daily user of social media

Facebook users and target group

Country Users Female Within target Persons

Finland 2 M 53 % appr. 22 % of total users = 440 000

Italy 21 M 46 % appr. 21 % of total users = 4 400 000

US 155 M 55 % appr. 24 % of total users = 37 200 000

http://www.socialbakers.com/facebook-statistics/

slide13

Target group / USP & Value proposition

Daily physical activity as a part

of your social media experience

Hookie offers automatic, free(mium) and fun activity monitoring with benefits and rewards based on daily activity.

A user only has to carry her mobile phone and daily physical activity is gathered automatically. Unlike other mobile phone based sport tracking services, Hookie utilizes the accelerometer, not GPS location. This enables continuous use of service without battery problems.

slide14

Business Concept

HookieFacebookservice

Marketer

Activity

information

Message / conversion to shops

Marketing

message

Hookie offers marketing channel for consumer brands in social media / mobile phones with holistic user information, long engagement and conversion to real life.

slide15

Business Concept – Added Value and Revenue Generation

User Added Value

MarketerAdded Value

  • Free wellness service
  • Extremely easy to use
  • Physical activity as a part of Facebook profile
  • Not just exercise, but everything you do during the day
  • Fun. Users can participate challenges and games with their activity
  • Benefits, e.g. discounts based on the physical activity
  • Users decide where to they connect their activity information and how they utilize their activity
  • Long lasting, engaging connection with consumers in social media
  • Connection to user through mobile phone (messages in HookieApp)
  • Conversion to shops = more sales
  • Holistic information about consumers physical activity (helps to target marketing)
  • Trustworthy information. Hookie identifies the user, so it can´t be cheated

User generation

Revenue generation

YearUsers

2012 300 K

2013 1,1 M

2014 5,2 M

2014 22 M

Year Revenue EBIT

2012 402 K € - 404 K €

2013 2,60 M € 1,0 M €

2014 5,25 M € 2,4 M € 2015 14,40 M € 10,0 M €

slide16

Business Concept – Non-Core Revenue Generation

Licencing and royalties

IPR Licensing

  • Hookie is in negotiations with NTT Docomo and Samsung of licensing software and algorithms for other applications. Also, a Finnish company Crelint Ltd is signing a Letter of Intent of utilizing Hookie´s technology in their on-site services for healthcare and industrial clients.
  • Stompwell Ltd (spin-off from Hookie) will pay licensing fee for activity analysis and royalty for the corporate wellness service (www.intenzlife.com) which was sold to two ex-team members of Hookie.
  • The licensing and royalty cases are an additional revenue source utilized to finance development and growth of core business
  • Hookie’s IPR portfolio includes automatic exclusive rights for a patent on person identification based on the person’s movement
  • There are possibilities of licensing IPR / technology for other applications
    • e.g. unlocking of mobile phone authenticated by movement, man to machine connections etc.
  • At this stage the IPR licensing potential has not been explored and has not been included in the business plan

Revenue

Potential for future

revenue generation

2012 90 000 €

2013 275 000 €

2014 350 000 €

2015 420 000 €

slide18

Market opportunity

Marketing is strongly shifting to digital and social medias

• Online advertising surpass print media in US this year with 39,5 billion.

(Los Angeles Times January 2012)

• Social media advertising revenues grow from 2.1 B $ in 2010 to 8.1 B $ in 2015

• “There will be a number of format developments beyond display”

(BIA Kelsey 2011, www.biakelsey.com)

• 2011 Facebookadvertisingvalue in Finland 4,6 M € (220 M € alldigital)

Consumer brands look for new possibilities to reach

and engage customers in social media.

slide19

Go to market | User acquisition

Launch partners

The service is launched with a bigger consumer brand as a launch partner. The messaging is targeted to partners existing client base.

E.g. Wellness or fashion related magazines / fast food chains.

Social media seeding / community marketing

The service is actively seeded in social media with specialized partner. Also, Hookie community manager will actively manage the content and acquire new users.

Game / service developers

Hookie activity platform has open APIs for other game/service developers to create content of their own. This will support the user acquisition.

slide20

Competition matrix

Automatic

activity

recognition

Open

interface for

developers

3rd party benefits

from activity

Mobile

phone

based

Automatic

person

identification

Target

group

Scalability

Social media

connection

Common

people

HIGH

HIGH

Common

people

HIGH

HIGH

Web based

Common

people

MEDIUM

MEDIUM

Mobile option

Nike+

Sport

enthusiasts

MEDIUM

LOW

Needs HW

Sport

enthusiasts

MEDIUM

MEDIUM

Sport

enthusiasts

HIGH

LOW

Sport

enthusiasts

Needs HW

LOW

LOW

Sport

enthusiasts

Needs HW

LOW

LOW

Common

people

LOW

LOW

Needs HW

Common

people

S2H.COM

LOW

LOW

Needs HW

slide22

Revenue stream | Next Quarterly

Assumptions

• Appr. 40 % of the users participate in activity campaigns.

• In the beginning of the user path, a user is estimated to take part in 3 – 5 campaigns / year.

Probably later this ratio will be will be lower, which is noticed in the later revenue growth.

• Campaigns bring 0,5 € revenue per participating user. This is based on the information from other

online / mobile advertising based services e.g. Blyk in UK.

• Cost of acquiring a “fan” on the Facebook is $1.07 (Wall Street Journal 2/2011)

slide30

Management and Board

BOARD

MANAGEMENT

CEO

Hannu Puolitaival

LauriRepokari (Chairman)

• ProfessorStanford University

ErkkiAaltonen

VTT Ventures Ltd, Investment Director

EeroPunkka

• VTT, Head of Unit, ex-Suunto Head of R&D

TimoSipi

• Partner at LMR Attorneys

TuomasKohila

• Experienced entrepreneur

TommiPetterson

• CEO of EpteinOy, ex SVP of Elcotec

CTO

OtsoKivekäs

UI / UX DESIGNER

Maria Kulse

slide33

Appendix 1 - Current Shareholders

OwnerAmount of shares Percentage

Hookie Technologies Ltd (shares under company possession) 4600 28,8 %

Hannu Puolitaival 2300 14,4 %

Lauri Repokari 1400 8,8 %

VTT Ventures 4225 26,5 %

Timo Sipi 100 0,6 %

Tommi Pettersson 454 2,8 %

Johan Lilja 545 3,4 %

Heidi Mattila (Jari Tuomala) 500 3,1 %

Eero Pöhö 727 4,6 %

FinPacifiTradeCompany Oy (Tuomas Kohila) 909 5,7 %

PartnerUp Finland Oy (Jussi Heinilä) 200 1,3 %

15960 100 %