coverago overview final
DESCRIPTION
Company overviewTRANSCRIPT
CONFIDENTIAL
Coverago
May 2011
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Table of Contents
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Company and Leadership Introduction
The Problem & Solution: Coverago News
The Opportunity
How to Scalea. Creation: Building a News Factoryb. Distribution: Building a News Marketplacec. Roadmap Forward
Financialsd. Economic Leveragee. Customer Leveragef. Financial Modelg. Uses
Appendixh. Full Team Biographiesi. Usage Case Studiesj. NewsMercato Screenshotsk. Creation Technology Tools Screenshots
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Section 1:
Company and Leadership Introduction
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Founded July 2008—built and owned by founders and employees
56 employees and 50 contractors in 14 countries
Operations centers in China, Israel and the US that are staffed by analysts 24 hours a day, 7 days a week, who collectively speak 32 languages
Core product offering: Coverago News was developed in September 2009
Over 40 Licensed Clients, ranging from $11,000 to $900,000 per annualized license
Coverago was formed to address the need for a single, organized and timely source for news, company information, and themes around the world
Company Background
Coverago Formed
Coverago Platform Released
July 2008 March 2009 October 2009 January 2010 January 2011
Presence Established in Israel
August 2010 March 2010
Presence Established in China
Coverago News Released
2008 – 2011: Selected company and product developments
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Coverago Global Presence
Global Headquarters: Newark, NJ•Senior Management (3)•Product Management (2)•Business & Client Development (5)•Software Development (4)•Research and Information (15)•Human Capital Development (1)
EMEA Region: Herzliya, Israel•Regional Management (1)•Research & Information (20)
Asia Region: Shanghai, China•Regional Management (1)•Research and Information (4)
Coverago Global / Regional Headquarters
Coverago Consultants
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Board of Directors
Mark Gerson – ChairmanWilliams College; Yale Law School: JDMark Gerson is the Executive Chairman of Gerson Lehrman Group (GLG), which he co-founded in 1998. Mark is the author several books and essays in newspapers and magazines including The New Republic, Reader’s Digest, Commentary, USA Today, The Weekly Standard and the Wall Street Journal. He is the Chairman of United Hatzalah (the network of first responders that treat victims of pre-hospital trauma in Israel) and the Africa Mission Healthcare Foundation (which supports the work of medical missionaries performing clinical care throughout Africa).
John W. Cooper – Chief Executive OfficerGettysburg College: BA Computer Science; Columbia Business School: MBAJohn Cooper is the Chief Executive Officer of Coverago. Mr. Cooper has over a decade of experience in finance and software and was most recently an Investment Banker with Bear Stearns & Co. in their Technology, Media, and Telecom group. Prior to that, Mr. Cooper held engineering and sales management positions with Plumtree Software. Mr. Cooper was with Plumtree from the company’s early stages as a Sequoia-backed start-up through its IPO and subsequent acquisition by BEA Systems. John began his career with Sun Microsystems in their Best-of-the-Best program as a Software Engineer.
Erez Kalir – DirectorStanford; Oxford; Yale Law SchoolErez Kalir is a founding partner of Sabretooth Capital, an investment firm seeded by Tiger Management. Before then he worked on the investment team at Tiger Management. Prior to that, he was part of the team that launched Eton Park Capital Management and before then, at McKinsey & Co. Mr. Kalir holds degrees from Stanford, Oxford, and Yale Law School.
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Senior Management
John W. Cooper - Chief Executive OfficerGettysburg College: BA Computer Science; Columbia Business School: MBAJohn Cooper is the Chief Executive Officer of Coverago. Mr. Cooper has over a decade of experience in finance and software and was most recently an Investment Banker with Bear Stearns & Co. in their Technology, Media, and Telecom group. Prior to that, Mr. Cooper held engineering and sales management positions with Plumtree Software.
Stefan M. Lehmann - Vice President, OperationsCornell University: BA Government; Columbia Business School: MBAStefan Lehmann joined Coverago in 2008. Mr. Lehmann has spent over seven years in financial services. Most recently, Mr. Lehmann was an Investment Banker at Lehman Brothers, first with their Global Technology group and later in the firm’s Debt Capital Markets division. Prior to that, Mr. Lehmann was at Morgan Stanley in their Global Capital Markets division.
David Yang – Vice President, EngineeringUniversity of Illinois: BS Electrical EngineeringDavid Yang is VP, Engineering at Coverago. Prior to Coverago, David Yang led the technology infrastructure development team at Gilt Groupe. Mr. Yang also served as Application Architect at RecycleBank, a Kleiner Perkins-backed start-up. Previously, Mr. Yang spent time as an engineer at Yahoo! and practiced as a consultant at Deloitte Consulting.
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Regional Managing Directors and Product Management
Kevin Baxpehler – Managing Director, Operations - EMEAIDC Herzliya: BA IT Management; New York University – Leonard N. Stern School of Business: MBA Kevin Baxpehler joined Coverago in 2009 as Director of Operations for EMEA. Previously Mr. Baxpehler was an Investment Banker with Credit Suisse in their Leveraged Finance Group. Prior to that he was a Research Manager for the Gerson Lehrman Group and before that he was a Co-founder of a software start-up.
Natalie Somekh – Director, Product Management - DistributionUniversity of Cambridge: MA Economics; Harvard Business School: MBANatalie Somekh joined Coverago as a Director of Product Management, reporting directly to the CEO. Prior to Coverago, Ms. Somekh was an international equities investor at hedge fund, Millgate Capital, in New York. Prior to that she worked in London at private equity fund, Duke Street Capital, and in investment banking at Merrill Lynch.
Jonathan Drillings – Director, Product Management - CreationDuke University: BA Biomedical EngineeringPrior to Coverago, Jonathan spent 3 years at Investor Growth Capital (IGC), a growth-stage venture capital firm, and subsidiary of Investor AB. Prior to IGC, Jonathan spent time with Lake Street Capital, a secondary-direct venture capital firm, and Sonenshine Partners, a New York-based M&A boutique investment bank.
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Section 2:
The Problem & Solution: Coverago News
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What problems currently exist in the market for in-depth coverage of companies and topics?
Coverago News: The Problem
Global Media: Major newspapers, magazines, wire services
Problem: News is organized and highly accessible, however, editors select news that is targeted to the largest marketable audience in order to gain widest circulation/impressions. This drives advertising revenue and subscriptions, but results in weak or no coverage on important events that do not appeal to the broad market (1)
Local Media: Regional newspapers, trade journals, blogs, industry/company websites
Problem: Taken in aggregate, important events are generally covered in media, but news is often inaccessible to consumers because of language barriers and high search costs
Social Media: Twitter, Facebook, regional equivalents
Problem: Events are breaking first in social media, but news is often inaccessible because of language barriers and high search costs
(1) Pew Project for Excellence in Journalism 2009 Edition, the top 10 US stories online accounted for 48% of the US online news as a whole. The top 10 US media stories overall accounted for 62% of the US media stories overall. http://stateofthemedia.org/2009/online-intro/content-analysis/.
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Single media sources do not provide sufficient news coverage. By aggregating various media, news aggregators provide sufficient coverage, but have high costs to navigate
Coverago News: The Problem (Cont’d)
News Aggregators: Major online search engines, service based search, clipping services
Problem: News is algorithmically clustered and searchable, but translation is flawed and searching costs can still be too high to find the relevant news. Furthermore, publishers many times remove themselves out of aggregators
Example: Below is a screen shot highlighting searching costs – “Apple in China” search filtering for “past day” resulted in 3,092 news articles, no articles in Chinese
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Coverago News: The Solution
Through proprietary technology and a global workforce of Media Analysts, Coverago solves the problem and provides our clients high value, relevant news that is otherwise inaccessible
Valuable Targeted NewsSources
Aggregation, Translation, Summarization
Technology Media Analysts
Coverago News: The Solution (Cont’d)
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Many sources exist beyond the reach of major search engines that provide key datasets to our customers. Coverago makes this information accessible by combining Technology & Human Effort
Entir
e W
eb
Forums
Regulators
Visible Web Search Engines
Prin
tH
uman
Foreign Press
Government Filings
Investor Relations
Conference Calls
Paywalls
Media Analysts
Technology
1. “The murky depths of the deep web” - http://www.mkbergman.com/343/the-murky-depths-of-the-deep-web/
30% of our
News Summaries are sourced from non “Visible Web” sources.
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PR / Corporate Communications Case Study: Apple/Foxconn
Bloomberg ‘breaks’ the Foxconn suicide story on May 25, 2010 - Apple launched an internal investigation in May 26, 2010 (1)
11-July-2007
Employee commits suicide at Foxconn
Summary:
• 19 year old Hou Mou, a Foxconn employee, was believed to have committed suicide by hanging herself from the staff quarter bathrooms.
• Hou had called her parents on the evening of June 6th, saying that she planned to quit the factory on June 19th when she received her wages. She was found dead on June 18th.
• According to a reporter, the parents of the decreased found signs of foul play once they saw their daughter in the funeral home, and questioned whether or not her death was actually a suicide.
• Foxconn has not specifically revealed the cause of death.
Source (Chinese): Chinese Labour Bulletin [Link] Source Type
19-July-2009
Chat log from a friend of Sun Danyong, a suicide victim
Summary:
• On July 16th, Foxconn Technology Group employee, Sun Danyong, jumped committed suicide after jumping from the 12th floor of his dormitory.
• Sun was suspected to have responsible for a missing iPhone prototype because he was responsible for mailing the machine.
• News163 reports that Sun was beaten, searched, interrogated, and illegally detained.• The Foxconn Technology Group section chief involved in the incident has been suspended without pay and will be
investigated.
Source (Chinese): News163 [Link] Source Type:
21-July-2009 4:33 AM
25 Year Old Foxconn Employee Commits Suicide
Summary:
• On July 16th, Foxconn Technology Group employee, Sun Danyong, jumped committed suicide after jumping from the 12th floor of his dormitory.
• Sun was suspected to have responsible for a missing iPhone prototype because he was responsible for mailing the machine.
• News163 reports that Sun was beaten, searched, interrogated, and illegally detained.• The Foxconn Technology Group section chief involved in the incident has been suspended without pay and will be
investigated.
Source (Chinese): News163 [Link] Source Type:
09-November-2009 2:18 AM
Foxconn Employee Commits Suicide by Jumping
Summary:
• 23-year-old Foxconn employee Xi Tanguo recently jumped from the 5th floor roof of Foxconn's factory, crushing another employee who immediately fainted.
• Xi had been insulted by his supervisor and committed suicide after not being able to overcome the embarrassment and to maintain his innocence on the undisclosed issue.
• Some believe his suicide was caused by excessive work pressures. Apple has released a report saying that workers at Foxconn Shenzhen factory are working excessive hours.
• Foxconn has taken measures to prevent workers from speaking about the issue and has refused to comment.• Earlier this year, Sun Danyong also committed suicide after reportedly misplacing an iPhone prototype and suffering
confinement, interrogations, and beatings.
Source (Chinese): Epoch Times [Link] Source Type:
27-July-2010 8:32 PM
Pension Agreement Reached for Family of Foxconn Suicide Victim
Summary:
• Foxconn Technology has reached a preliminary agreement with the family of Sun Danyong, who committed suicide earlier in July, regarding a family pension and maintenance payment by the company.
• Foxconn will reportedly pay CNY 360,000 to the family in addition to CNY 30,000 a year maintenance, substituting the money that Sun would have sent to his parents to care for them.
• Li Jinming, Managing Director and Chief of Business Administration of Foxconn, said that though no amount could substitute the life of the decreased, Foxconn is sympathetic.
• Li reported that Foxconn would strengthen mental health support to alleviate emotional disputes, work pressures, and other problems and will increase investments to prevent future suicides.
• Sun had reportedly committed suicide from unfair treatment during an investigation involving a missing iPhone prototype.
Source (Chinese): China Review News [Link] Source Type: China's first digital agency network located in Hong Kong, Taiwan, Beijing and Guangzhou
Coverago News breaks stories long before larger, more broadly focused outlets do
(1) PC World article “Apple, HP, Dell Team to Investigate Foxconn Suicides” May 26, 2010. http://www.pcworld.com/article/197303/apple_hp_dell_team_to_investigate_foxc.
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Coverago News: The Solution (Cont’d)
Coverago monitors breaking news from the most robust set of global sources, from twitter to global media04-March-2010 6:20PM EST
Twitter users comment on Aramark’s aid to earthquake victims
Summary:
Engineer Lilian Borcoski wrote a Tweet about Aramark helping earthquake victims
She specified the areas of Santiago where the aid is already being supplied and informed that Aramark’s team will be helping backstage at the telethon tomorrow.
Source (Spanish): Twitter [Link]
Social networking & microblogging website
19-July-2009
Chat log from a friend of Sun Danyong, a suicide victim
Summary:
On July 16th, Foxconn Technology Group employee, Sun Danyong, jumped committed suicide after jumping from the 12th floor of his dormitory.
Sun was suspected to have responsible for a missing iPhone prototype because he was responsible for mailing the machine.
News163 reports that Sun was beaten, searched, interrogated, and illegally detained.
The Foxconn Technology Group section chief involved in the incident has been suspended without pay and will be investigated.
Source (Chinese): News163 [Link]
Chat Forum on Chinese internet portal
31-August-2010 4:52 AM EDT
Greenpeace has boarded oil rig belonging to Cairn Energy
Summary:
In an attempt to prevent new drillings off the coast of West Greenland, activists from Greenpeace boarded an oil rig belonging to British company Cairn Energy currently situated in the Baffin Bay.
Four activists from Greenpeace climbed up the side of drilling rig Stena Don this morning
The operation is taking place in the southern part of the Baffin Bay, 175 km west of the island Disko.
The purpose of the action is to prevent the oil company from moving the rig from the current oil wells to a new location about 100 km further north, where Cairn will drill a new well.
Cairn announced last week that it had made a small discovery of natural gas in one of the initial two test wells.
Source (Danish): Berlingske Tidende [ Link ]
Danish Daily Newspaper
05-July-2010 11:16 AM EDT
Gazprom Has Not Recovered From Crisis
Summary:
According to the Fuel and Energy Authorities, gas production in Russia in first half 2010 rose by 21.8% compared to the similar period of last year to 334 billion cubic meters. Compared to May, the figure has decreased by 12.5% to 44.72 billion m3.
Gazprom's production in the first half a year was 262.175 billion m3. In June the company produced 33,472 billion m3, which is a 15.7% fall compared to last month.
6.2 billion out of total 6.5 billion in the industry decrease accounted to Gazprom. Total gas production rose by 19.8% compared to June 2009 but still has not reached
the pre-crisis amounts. Gas exports grew 1.5 times in th first six months to 91.662 billion m3. Exports to the
former Soviet territories grew three-fold; exports to the rest of the world increased by 15.6%.
Gazprom expects to recover two thirds of last year's fall during 2010. The local market will fully recover by 2012-2013, Gazprom's representatives say.
Gazprom's production plan for 2010 is 519 billion m3. As for oil production, Russia is still remaining the leader with the daily production of
10.13 million barrels, which is 0.5% higher than in May.
Source (Russian): Kommersant [ Link ]
Commerce oriented Russian Newspaper
17-August-2010 01:16 AM EDT
Synutra's Hormone Scandal Causes Crisis of Confidence in China's Dairy Industry
Summary:
On August 15, China's Health Ministry made an announcement that they found no evidence that milk powder made by Synutra International caused abnormal hormone levels in children.
In the week following the hormone scare, Synutra’s market value shrank by over 2 billion yuan. General stock prices in the dairy sector have dropped consequently, with Mengniu’s stock price plummeting by 4.3% in 3 days.
Some analysts believe this hormone scare will heavily impact China’s dairy market. Negative effects to the industry could last for at least a year.
Euroserum, the world’s largest producer of whey powder (one of the major raw materials of milk powder) from Europe, is a strategic partner of Synutra.
However, in March 2008, 1,075 tons of whey powder imported by Chinese companies from Euroserum was disqualified by customs, mainly because of its “overranging of protein content.”
A former agent of Euroserum’s products disclosed that Yili and Mengniu are also clients of the company.
Source (Chinese): E23 [ Link ]
News portal based out of Jinan, China
27-July-2010 02:42 AM EDT
Chrysler Wins 70% of Cases as Dealer Arbitration Ends
Summary:
Chrysler said arbitrators ruled in its favor in 70% of cases brought by dealers who sought reinstatement after the company cut them from its network.
The arbitration process has concluded, and Chrysler prevailed in 76 of 108 of the decisions.
Under a law enacted in December, Chrysler was required to offer binding arbitration to dealers that were terminated in its bankruptcy reorganization.
Of the 789 dealers terminated, 418 applied for arbitration, Mike Palese, a Chrysler spokesman, said on July 26. The cases that didn’t go to final arbitration were either settled, dismissed, withdrawn or abandoned, he said.
Chrysler had 2,315 dealers as of June 30, and 29 previously rejected locations have accepted company offers to become dealers, Palese said.
“We’re definitely within the network size that we’re looking for,” he said. Chrysler expects a total U.S. dealer network of 2,300 by the end of next year because of attrition and further consolidation, he said.
Source (English): Bloomberg [ Link ]
Global news network
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Coverago News compared to
Company Headlines Coverago Bloomberg Wire Coverago Lead Time
BR Malls (BRML3) Additional Information Regarding BR Malls Release 3-11 01:28 PM N/A > 10 DaysBR Malls (BRML3) 4Q09 and 2009 Earnings Release 3-10 10:07 PM 3-10 22:09 PM 2 Hours 2 MinsBR Malls (BRML3) Usiminas Replaces BR Malls in Bradesco's Recommended March Portfolio 3-02 04:28 PM N/A > 10 DaysBR Malls (BRML3) HSBC Announces Stock Recommendatiosn for March 3-02 10:02 AM N/A > 10 Days
ZTE Corp (00763) ZTE's Patent Applications Grew by Over 50% 3-15 11:43 AM N/A > 10 DaysZTE Corp (00763) ZTE Developing Second Phase EV-DO RevB Newtork 3-11 08:21 PM N/A > 10 DaysZTE Corp (00763) ZTE Commet Wireless to co-build LTE Labs 3-11 07:59 PM N/A > 10 Days
Cielo (CIEL3) Redecard and Cielo to Complete for Recievables 3-19 05:47 AM N/A > 10 DaysCielo (CIEL3) The Next Phase of the Credit Card Industry 3-17 05:14 AM N/A > 10 DaysCielo (CIEL3) The End of the Duoploy Will Not Harm Cielo and Redecard 3-15 09:31 AM N/A > 10 Days
Company Headlines Coverago Dow Jones Coverago Lead TimeActelion (ATLN) Actelion Extends Partnership with Invida to Market Tracleer in Key Asian Markets 3-26 09:10 AM N/A > 10 DaysActelion (ATLN) Zvesca is Available in Canada for Rare Progressive Niemann-Pick type C diese 3-23 01:15 PM N/A > 10 DaysActelion (ATLN) Investigational Dual Orexin Receptor Anatagonist Almorexant Meets Primary Endpoints 3-20 03:40 AM N/A > 10 DaysActelion (ATLN) Actelion Recives 'Complete Response Letter' from the FDA 3-09 11:45 AM 3-09 11:45 AM NoneActelion (ATLN) Bloggers Analyze Actelion's New Candidate Drug, Orexin-RA-1 3-08 07:20 AM N/A > 10 Days
OTP Bank (OTP) OTP Raises Minnimum for Private Banking Services from HUF 50MM to HUF 70MM 4-15 04:08 AM N/A > 10 DaysOTP Bank (OTP) New Survey Shows OTP Leading Hungarian Banking Sector, Increasing Market Share 4-14 05:24 AM N/A > 10 DaysOTP Bank (OTP) Hugarian Competition Authority Fines OTP HUF 10MM for Unfair Commerical Practices 4-12 09:31 AM N/A > 10 Days
EDF Energies Nouvelles (EEN) Enel, EDF and Ansaldo Energia Sign MoU for Development of Nuclear Power in Italy 4-09 06:00 AM N/A > 10 DaysEDF Energies Nouvelles (EEN) EDF Announces Formation of New Group Management Committee 4-08 06:00 AM N/A > 10 DaysEDF Energies Nouvelles (EEN) EDF Plans to Hire 10,000 Over the Next Five Years as It Expands Its Nuclear Present in the UK 4-06 01:33 AM N/A > 10 DaysEDF Energies Nouvelles (EEN) EDF CEO, Henri Proglio, Expected to Reject GDF Suez SA Working Agreement 4-06 06:00 AM N/A > 10 Days
Areva: Robot Offers Refused by Tokyo Electric Power28 March 2011 11:26 PM EDT Source (Japanese): Yomiuri Online
• On March 28, French Energy Minister Eric Besson announced that Areva, a French nuclear reactor maker, will send two radioactive water treatment experts to Japan.
• Areva said it is prepared to send additional experts if necessary.• Areva also offered robots to Tokyo Electric Power, and was refused by the latter. TEPCO judged
that the usage of robots will not have decisive effect, according to Areva.• Areva said that the robots it offered were developed by EDF (Électricité de France SA) and Areva.
Utilizing Proprietary Technology and Human Efforts to Monitor for News . . .
. . . and Efficiently GenerateEnglish-Language Summaries of that News
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Coverago News: The Solution
1. Clients tell us specific companies / themes they are interested in
2. We staff Global Media Analysts (GMAs) who:a. Find all relevant sourcesb. Monitor sourcesc. Filter for materiality and duplicatesd. Summarize in English
3. News summaries delivered with custom delivery settings, accessed via web platform or email
4. Both historical and breaking news available
5. Archived and indexed historical information is fully searchable
Coverago News enables the consumer to be the editor, directing our focus. Coverago News delivers content that is material or relevant
Coverago utilizes proprietary technology to aid intelligent human research & creation and turn ourclient’s global research objectives into concise, curated, English-language summaries
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Coverage To Date
Coverago News has covered 1,006 companies and 311 themes to date from our clients in the investing, legal, PR and corporate worlds. NewsMercato will enable us to expand to a retail customer base and to leverage our news coverage using network effects
1,006 Companies covered including: Akbank: English & Turkish Apple: Chinese & English Banco Santander (Brazil): English & Portuguese BYD: Chinese & English China Minsheng Banking Corp: Chinese & English Fiat: Italian Power One: English Royal Dutch Shell: Arabic, Chinese, English,
Portuguese, Russian, Spanish SAP: Chinese, English & German
311 Themes covered including: Gambling Industry (Brazil): Portuguese Insurance Industry (China): Chinese LED Displays (Korea): Korean Iron Ore (Australia): English Rare Earth Mining: Japanese Financial Services Sector Regulations (China):
English & Chinese Salmon Production (Chile): English & Spanish Tablet Components – Semiconductors: Korean GE Nuclear Reactor Design: Japanese
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Section 3:
The Opportunity
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We have discovered three important insights…
1. Combining proprietary technology with a global human effort, we can produce news in a highly profitable wayCoverago’s Media Analyst workforce has doubled productivity with each new release of our publishing platform. On a per unit basis, the operation was profitable with the first release of the platform.
2. High percentage (and growing) of similarity in clients’ requestsThe long tail of the news market was more resalable than we expected. Different clients from different market segments (legal, finance, corporate, PR, etc) have continued to request much of the same news. Our coverage requests are approaching 30% duplication and the percentage of duplicate requests is growing in relation to the size of our coverage universe.
3. We can lower the price as we resell the same news. This amortizes our costs, increases our defensibility, and expands the addressable marketVolume pricing, packaging and marketing automation allow us to target multiple profitable customer segments. News coverage is easy to package and a great source of marketing automation (newsletters, SEO/SEM) that allow us to find customers along the entire spectrum of pricing
$ in 000s
The Opportunity: Market Size
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Sources: Dealogic, AmLaw, Fortune, UN, Veronis Suhler Stevenson Communication Industry Forecast, CapitalIQ, Pew Research(1) Based on transaction volume per Dealogic – 2010.(2) Based on information from subject expert – includes large law firms(AmLaw 200) and small law firms consisting of an assumed 1,000 additional firms capable
of scale to properly utilize News.(3) Global Fortune 2,000, all of which would have the scale need for international document search and translation.(4) Based on UN’s UNCTAD estimate.(5) Total registered non-profit organizations as of 2009 per the National Center for Charitable Statistics at the Urban Institute.(6) Based on the research paper “How Big Is Public Relations (and Why Does It Matter)?” by Toni Muzi Falconi, 2006. $5.2 billion annual spend on PR, 2009
Veronis Suhler Stevenson (VSS) Communications Industry Forecast(7) Global government agencies that are responsible for collecting, producing, and promoting open source intelligence.(8) Based on CapitalIq client base (prior to merger with themarkets.com). (9) Center for Association Leadership(10) Pew Internet & American Life Project 2010 & US Census data(11) Based on compiled statistics from Wikipedia for the top four strategy consulting firms (http://en.wikipedia.org/wiki/McKinsey_%26_Company)
Market Segments Available Market Est. Annual Average
Customer Price Total Market Comments
Investment Banks 107(1) $100 $10,700 Follow client, target/acquirer news, investment themes, trading
Law Firms 1,200(2) $50 $60,000 Follow client, target/acquirer news
Corporate Communications 1,950(3) $50 $97,500 Follow company for information on strategic and reputational risks
Transnational Corporations 63,000(3) $25 $1,575,000 Follow acquisition targets, cross-boarder trade & areas of interest
Non-Profits 1,581,111(5) $0.10 $158,111 Follow topics to support funding or efforts
Public Relations 400,000(6) $5 $2,000,000 Follow stories on client, executives
Government 437(7) $100 $43,700 Follow stories on national and international developments
Investment Management 4,200(8) $60 $252,000 Follow investment themes, companies of interest
Associations 86,000(9) $10 $860,000 Follow news that is relevant to the association
Retail Investors 25,000,000(10) $0.10 $2,500,000 Follow investment themes, companies of interest
Strategy Consultants 21,000(11) $3 $63,000 Follow client, industry topics,
Total Market Size $7,557,011
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Section 4:
How to Scale
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Section 4a:
Creation: Building a News Factory
Increasing operating leverage, developing building blocks of resalable news, building a news factory
The Creation Process
Four components to Creation: Initiation, Monitoring, Authoring, Editing. Technology and human effort are combined in each component to create an efficient, scalable process
Monitoring Authoring Editing
Analyst research is stored in Coverago’s structured wiki in Company and Topic Pages
Content helps other analysts quickly get up to speed, synchronizes knowledge across various geographies and prevents knowledge loss
Analyst also codifies RSS feeds, News and Search Alerts and keywords for internal web crawlers
Company and Topic pages drive the automated crawlers of QSpace
Coverago proprietary technology monitors news across disparate sources and creates central location where GMAs stay up-to-the-second
Collaboration tools reduce redundancy and load balances workload intelligently across analysts
Analyst selects a material news article for summarization
Automation tools to capture full-text, translate, extract entities and generate auto-summarization
Authoring tool for writing summaries and submission for editing
Editor works off his own queue of submitted articles and checks for quality, relevance and accuracy
Editing tool shows summary and full-text extraction
Supports workflow for summary re-work, editing and sending
Initiation
In Design Prototype Production Production
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News and Topic Bundling
4-May-2011 8:32 PM
Nissan Leaf Hits The Track
Summary: ….
Companies:Products:Technologies
News classification using computer and human entity extraction allow us to generate mass-customized derivative product bundles of our crafted summaries
5-May-2011 2:15 PM
Nissan plans “second-life” for Leaf NiMH
Summary: ….
Companies:ProductsTechnologies:
6-May-2011 5:33 PM
Green Car Loans awarded to Ford, Tesla
Summary :…
Companies:Products:Technologies:
Automated Newsletter:High Efficiency Vehicles
SEO Landing Page
Nissan Leaf
Tesla
NiMH Batteries
Nissan
Zero-Emission
Ford
Zero-EmissionTesla Roadster Ford Ranger EV
NiMH Batteries
NissanNissan Leaf
NiMH Batteries
• NissanCompany
• Better PlaceCompany
• TeslaCompany
• Nissan LeafProduct
• NiMH BatteriesTheme
• Zero-emissionTheme
The Creation Process
Better Place
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Section 4b:
Distribution: Building a News Marketplace
Increasing market penetration, entering new markets, increasing margin contribution, building a news marketplace
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Scaling Coverago News: News Coverage at Scale
Increasing sales automation technology will allow Coverago to address lower RPU customers. Coverago’s News Marketplace captures the distribution opportunity of increasingly automated customer touchpoints and increased RPU through resalability and targeting.
Sale
s Au
tom
ation
Revenue Per User
Retail Investor and Consumers
Channel and Marketing automation have exposed us to this customer segment but they have been costly to service
High-End Customers
Direct Sales is able to reach a significant market for news coverage already
News Marketplace(News Mercato)
An iTunes-like marketplace of news that optimizes for resalability and automation
Low Revenue High Revenue
Low
Aut
omati
on,
Hig
h Co
st o
f Sal
esH
igh
Auto
mati
on,
Low
Cos
t of S
ales
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Current Product Outputs
Web only
Newsletter
Real time email
Rollups
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Scaling Coverago News: The News Marketplace
The News Marketplace (NewsMercato) is a new delivery system for Coverago News, currently under development. It offers the same quality and solution set at a lower price, with increased automation via an iTunes-like marketplace
Viral: Incentivize existing customers to invite friends, make recommendations and create interesting newsletters available for resale using (1) credits and (2) lower prices on existing requests
Suggestive: Make intelligent request recommendations based on what’s popular and usage patterns Automatable: Customer and news information creates diverse SEM and SEO opportunities (Company/Topic Landing
Pages, Industry Vertical Newsletters/Reports, etc.) Affiliate Marketing; Incentivizing affiliates to refer and send users to NewsMercato
Key
Feat
ures
Cust
omer
sSa
les
Stra
tegy
Bene
fits
Create Your Own Newsletter encourages users to create custom content for distributing to their own channels Set Your Own Price captures users at all points of the demand curve Intelligent Recommendations help our users generate ideas and find related concepts
Coverago News currently serves institutional clients mostly in the financial services industry NewsMercato expands our reach to retail customers and industry verticals
Self provisioning, lower subscriber acquisition costs, increased resale Network effects: as more users choose the same companies or topics, they are incentivized to recommend these to
others which drives demand and results in lower prices, which then interests additional customers etc. Margin expansion as resale of Coverago News summaries increases
30
NewsMercato: The iTunes for News
Easy-to-use, searchable, automated interface that diminishes the need for direct sales and encourages marketplace participation
Create Your Own NewslettersUsers create newsletters for their own network, signups through that newsletter place credits in their account
Set Your Own PriceUsers express their interest through “price triggers” that allow us to balance coverage cost with long tail market size
Intelligent RecommendationsOur customers are constantly looking for idea generation – collaborative filtering allows us to make “Genius” type recommendations
31
Scaling Coverago News: NewsMercato Network Effect
As more users subscribe to the same topics, prices fall while margin increases
Dynamic and transparent pricing allows us to capture users at multiple points of the demand curve
Credits for direct and/or Newsletter user referrals create viral growth channels
Consultant responsible for auto industry
Investor covering Chinese large-cap
Investor Googles “BYD”
Consultant received referral from friend recommending NewsMercato coverage of BYD
Coverago SEM and affiliate sales
program bring investor and
consultant to BYD company page on
NewsMercato
Both clients brought to BYD landing page would pay $12/day each
$12/day
$12 /day
$9 /day
$9/day
$9 /day
$9 /day(Credit)
$3 /day
$3 /day$3 /day(Credit)
$3 /day
Investor refers no one
Consultant refers colleagues(receives what referral spends in first month in credit)
After 6 days, consultant colleagues begin following BYD and market price drops
After an additional 6 days, more colleagues follow BYD and market price drops to $3/day …
Investor benefits from price decline despite not referring anyone …
32
Section 4c:
Roadmap Forward
Coverago Product Roadmap
Track 2011Q2 2011Q3 2011Q4
Creation
Initiation- Company and Topic Pages 1.0- Population of data from current
sources
- Coverago Training Program
Monitoring- QSpace unified queues- QSpace shared queues
- Forum crawlers- E-mail extraction
Authoring- Full-text extraction and translation- Performance analytics
- Entity extraction- Auto-summarization
- Summarization: Feedback scoring
Editing- Performance Analytics - Real-time View of
Authoring- Reading Level Analysis
checks on Summaries
Distribution
Customer Acquisition
- SEO pages driven from Company and Topic Pages incorporating News
- NewsMercato (NM)
- Custom Industry specific Newsletters and Landing domains
- Keyword generator tool
- Entity Pages (Autogen)- SalesForce integration- Social Media Push
Activation- NM: Company and topic self-service
purchasing and price trigger setting- NM: Account History for
Referral Activation
Referral
- NM: Refer LinkedIn, Twitter contacts (auto-import)
- NM: Pricing and credit bonus based on referrals who activate
- Individual affiliate links for Newsletters
- Company and Industry Reports
Retention- NM: Activity Feed- NM: Follow users
- NM: Intelligent Recommendations
- News Pusher
Analytics- E-mail analytics - Website hooks for A/B
Multivariate testing
33
34
Section 5:
Financials
35
Section 5a:
Economic Leverage
36
Economic Leverage: Unit Economics & Margin Progression
Drivers 2011E 2012E 2013E 2014E 2015E 2016E
Coverago News Pricing AssumptionsNews Daily Subscription - Company 9.00$ 9.00$ 6.00$ 4.50$ 3.00$ 2.50$ News Daily Subscription - Theme 12.00$ 12.00$ 12.00$ 11.00$ 10.00$ 9.00$
Coverago News SubscriptionsCompany Subscriptions 2,384 7,009 41,122 215,617 566,735 1,232,262 Theme Subscriptions 1,192 3,504 9,869 52,046 137,390 281,660
Coverago News Coverage UniverseCompanies Under Coverage - Average / Day 585 1,509 5,167 16,781 34,105 46,210 Themes Under Coverage - Average / Day 564 2,127 5,771 16,752 25,187 25,187
Implied Subscription Re-Sale RateCompany Subscriptions 4.1 4.6 8.0 12.8 16.6 26.7 Theme Subscriptions 2.1 1.6 1.7 3.1 5.5 11.2
Research Expense DriversGMA Coverage Load - Company 40 50 50 50 50 50 GMA Coverage Load - Theme 20 30 30 30 30 30 GMA Team Size - Company 2 2 2 2 2 2 GMA Team Size - Theme 3 3 3 3 3 3
Unit Economics 2011E 2012E 2013E 2014E 2015E 2016E
Unit Revenue ContributionCompany 36.67$ 41.81$ 47.76$ 57.82$ 49.85$ 66.67$ Theme 25.36$ 19.77$ 20.52$ 34.17$ 54.55$ 100.64$
Unit Average Cost of CoverageCompany 7.12$ 5.70$ 5.70$ 5.70$ 5.70$ 5.70$ Theme 24.66$ 16.44$ 16.44$ 16.44$ 16.44$ 16.44$
Unit Margin ContributionCompany 29.55$ 36.11$ 42.06$ 52.12$ 44.15$ 60.97$
% margin 81% 86% 88% 90% 89% 91%
Theme 0.70$ 3.34$ 4.08$ 17.74$ 38.11$ 84.20$ % margin 3% 17% 20% 52% 70% 84%
Blended 15.39$ 16.94$ 22.02$ 34.94$ 41.59$ 69.16$ % margin 49% 59% 66% 76% 80% 88%
37
Section 5b:
Customer Leverage
38
Clients typically launch trials with a small, focused group of users and a limited number of subscriptions
On expiration of the trial period, the user base may shift, but does not grow meaningfully
However, over the first several months of the contract, the user base typically grows
Requests per user also typically grow over contract life as (i) clients understand and trust the Coverago News offering and (ii) clients understand how to integrate Coverago News into their workflow
Customer Leverage: Breakdown & Trends to Date
Month 1 Month 2 Month 3 Month 4 Month 5 Month 60
1
2
3
4
5
6
6
7
8
9
10
11
12
Average Users / Contract Average Requests / User
Use
rs /
Con
trac
t
Requ
ests
/ U
ser
Client accounts typically grow in both number of users and in number of requests per user
Contract Average
Market Segment $ Size # Users Requests / User
Financial Services / Institutional Investors
$57,736 3 16
Law Firm / Internal Legal & Compliance
$55,000 12 2
CorporateCommunications
$104,625 12 2
PublicRelations
$21,425 2 5
39
Customer Leverage: Overview of Client Pricing Trends
Institutional Investors Annualized Contract Corporate Communications Annualized ContractNewly- launched frontier market fund $119 Large- Cap Pharma Company $48,000Large global long/short fund $37,365 Leading European PE Firm $168,000Global long / short fund $82,136 Leading Global Financial Services Firm $192,000Tech- focused long / short fund $150,000 Leading Global Financial Services Firm $10,500Long/short global macro hedge fund $119,640 Total $418,500Small hedge fund $900 Average $104,625Small hedge fund $1,300Small hedge fund $380Fundamental, domestic long / short fund $48,000 Public Relations Annualized ContractMid- sized hedge fund $30,000 Edelman $12,000Mid- sized hedge fund $4,200 Brunswick Group LLC $20,000Large globally focused fund $260,970 Public Relations $18,000Mid- sized long / short fund $24,480 Total $50,000Long / short fund $16,331 Average $16,667Newly- launched global long / short fund $14,400Large fund with highly global focus $60,000Large global long / short hedge fund $64,800 Crisis Management Daily PricingLarge global macro fund $180,000 Legal Defense Team $80Global long / short fund $46,392 Large Conglomorate $2,500Global long / short fund, LatAm focus $30,000 Total $2,580Large, global long / short fund $216,000 Average $1,290Mid- sized hedge fund $18,000Large hedge fund $78,000Large global macro fund $75,000 Legal Annualized ContractMid- sized hedge fund $17,200 Weil, Gotshal & Manges $60,000Mid- sized hedge fund $18,000 Investment Bank (Legal Department) $50,000Mid- sized hedge fund $22,000 Total $110,000
Total $1,615,613 Average $55,000Average $59,838
Global Investigation Annualized ContractJ ames Mintz $12,000
Mutual Fund Annualized Contract Total $12,000Large mutual fund $25,000 Average $12,000
Total $25,000Average $25,000
40
Section 5c:
Financial Model
41
Financial Model
Drivers 2010A Q1 Q2 Q3 Q4 2011E Q1 Q2 Q3 Q4 2012E
Companies Under Coverage - Average / Day 125 260 315 475 755 585 968 1,170 1,505 1,891 1,509 Themes Under Coverage - Average / Day 50 103 171 398 794 564 1,118 1,494 2,119 2,841 2,127
Coverago News
Average Number of Clients - Direct Sales 8 22 52 101 155 155 210 265 341 436 436 Average Number of Clients - NewsMercato 28 83 83 66 132 198 265 265 Average Company Subscriptions / Client 14 10 10 10 10 10 10 10 10 10 10 News Daily Subscription - Company 9.00$ 9.00$ 9.00$ 9.00$ 9.00$ 9.00$ 9.00$ 9.00$ 9.00$ 9.00$ 9.00$ Average Theme Subscriptions / Client 9 5 5 5 5 5 5 5 5 5 5 News Daily Subscription - Theme 11.00$ 12.00$ 12.00$ 12.00$ 12.00$ 12.00$ 12.00$ 12.00$ 12.00$ 12.00$ 12.00$
Research Expense Drivers
GMA Coverage Load - Company 40 40 40 40 40 40 50 50 50 50 50 GMA Coverage Load - Theme 20 20 20 20 20 20 30 30 30 30 30 GMA Team Size - Company 3 2 2 2 2 2 2 2 2 2 2 GMA Team Size - Theme 3 3 3 3 3 3 3 3 3 3 3
Company Headcount
Business Development - Total 6 6 6 12 12 13 14 19 24 24Business Development - Productive 4 4 5 9 9 10 11 12 16 16Global Media Analyst 29 41 83 157 157 151 196 272 360 360Other 10 13 24 29 29 29 31 34 37 37
Total 45 61 113 198 198 192 241 325 420 420
Profit and Loss 2010A Q1 Q2 Q3 Q4 2011E Q1 Q2 Q3 Q4 2012E
Revenues (Direct Sales) 444,709$ 291,600$ 699,840$ 1,358,856$ 2,097,770$ 4,448,066$ 2,835,693$ 3,572,724$ 4,600,552$ 5,890,096$ 16,899,065$ Revenues (NewsMercato) -$ -$ -$ 373,545$ 1,120,500$ 1,494,045$ 892,890$ 1,785,780$ 2,678,670$ 3,571,695$ 8,929,035$
444,709$ 291,600$ 699,840$ 1,732,401$ 3,218,270$ 5,942,111$ 3,728,583$ 5,358,504$ 7,279,222$ 9,461,791$ 25,828,100$
% growth 140% 94% 54% 900% 35% 26% 557% 333% 280%
Expenses
Research Expense 887,544 401,585 589,739 1,204,081 2,277,911 4,473,316 2,180,407 2,850,094 3,961,102 5,245,035 14,236,637
Other Payroll Expense 1,468,916 320,000 384,560 674,677 819,144 2,198,380 833,265 896,798 1,056,398 1,210,874 3,997,335
Sales Commissions 50,684 23,195 61,793 122,641 195,021 402,650 269,011 342,891 439,643 563,288 1,614,833
Marketing 181,650 243,110 436,551 774,673 1,635,984 1,043,105 1,332,234 1,811,899 2,366,223 6,553,462
Technology & Infrastructure 97,504 37,500 37,500 37,500 37,500 150,000 60,000 60,000 60,000 60,000 240,000
Rent, Utilities & Other 420,695 125,000 125,000 125,000 125,000 500,000 226,999 226,999 226,999 226,999 907,997
2,925,343 1,088,930 1,441,702 2,600,450 4,229,250 9,360,331 4,612,787 5,709,016 7,556,041 9,672,420 27,550,264
Profit / Loss Before Taxes (2,480,634)$ (797,330)$ (741,862)$ (868,049)$ (1,010,979)$ (3,418,219)$ (884,203)$ (350,512)$ (276,819)$ (210,629)$ (1,722,163)$
% margin
Cash Need -$ 741,862$ 1,609,910$ 2,620,889$ 2,620,889$ 3,505,093$ 3,855,605$ 4,132,424$ 4,343,053$ 4,343,053$
42
Financial Model
Drivers 2013E 2014E 2015E 2016E
Companies Under Coverage - Average / Day 5,167 16,781 34,105 46,210 Themes Under Coverage - Average / Day 5,771 16,752 25,187 25,187
Coverago News
Average Number of Clients - Direct Sales 814 2,131 3,819 6,023 Average Number of Clients - NewsMercato 831 5,304 13,355 29,184 Average Company Subscriptions / Client 25 29 33 35 News Daily Subscription - Company 6.00$ 4.50$ 3.00$ 2.50$ Average Theme Subscriptions / Client 6 7 8 8 News Daily Subscription - Theme 12.00$ 11.00$ 10.00$ 9.00$
Research Expense Drivers
GMA Coverage Load - Company 50 50 50 50 GMA Coverage Load - Theme 30 30 30 30 GMA Team Size - Company 2 2 2 2 GMA Team Size - Theme 3 3 3 3
Company Headcount
Business Development - Total 78 259 352 443Business Development - Productive 20 27 36 49Global Media Analyst 784 2,346 3,883 4,367Other 37 37 37 37
Total 898 2,642 4,271 4,847
Profit and Loss 2013E 2014E 2015E 2016E
Revenues (Direct Sales) 65,948,137$ 161,403,110$ 249,499,809$ 350,673,081$ Revenues (NewsMercato) 67,335,930$ 401,711,700$ 872,548,925$ 1,699,019,520$
133,284,067$ 563,114,810$ 1,122,048,734$ 2,049,692,601$
% growth 290% 145% 55% 41%
Expenses
Research Expense 70,371,767 135,417,906 222,062,249 247,241,831
Other Payroll Expense 9,163,498 11,323,498 14,283,498 18,283,498
Sales Commissions 5,394,971 14,227,438 23,240,858 33,096,890
Marketing 5,468,709 16,766,727 29,646,072 35,698,856
Technology & Infrastructure 480,000 960,000 969,600 969,600
Rent, Utilities & Other 2,142,046 5,901,228 9,597,842 10,769,532
93,020,991 184,596,797 299,800,119 346,060,207
Profit / Loss Before Taxes 40,263,076$ 378,518,013$ 822,248,615$ 1,703,632,395$
% margin 30% 67% 73% 83%
43
Section 5d:
Uses
44
Partnership
Use of proceeds:
$4.0M on Direct Sales
$4.0M on Marketing
$2.0M to invest in Media Analysts and editorial capabilities across variousoperation centers
Projecting significant profitability in 2013
We are seeking $10 MM to build a global sales force, begin broad web marketing efforts and continue building the Global Media Analysts workforce
45
Section 6:
Appendix
46
Section 6a:
Full Team Biographies
47
Board of Directors
Mark Gerson – ChairmanWilliams College; Yale Law School: JDMark Gerson is the Executive Chairman of Gerson Lehrman Group (GLG), which he co-founded in 1998. Mark is the author several books and essays in newspapers and magazines including The New Republic, Reader’s Digest, Commentary, USA Today, The Weekly Standard and the Wall Street Journal. He is the Chairman of United Hatzalah (the network of first responders that treat victims of pre-hospital trauma in Israel) and the Africa Mission Healthcare Foundation (which supports the work of medical missionaries performing clinical care throughout Africa).
John W. Cooper - Chief Executive OfficerGettysburg College: BA Computer Science; Columbia Business School: MBAJohn Cooper is the Chief Executive Officer of Coverago. Mr. Cooper has over a decade of experience in finance and software and was most recently an Investment Banker with Bear Stearns & Co. in their Technology, Media, and Telecom group. Prior to that, Mr. Cooper held engineering and sales management positions with Plumtree Software. Mr. Cooper was with Plumtree from the company’s early stages as a Sequoia-backed start-up through its IPO and subsequent acquisition by BEA Systems. John began his career with Sun Microsystems in their Best-of-the-Best program as a Software Engineer.
Erez Kalir – DirectorStanford; Oxford; Yale Law SchoolErez Kalir is a founding partner of Sabretooth Capital, an investment firm seeded by Tiger Management. Before then he worked on the investment team at Tiger Management. Prior to that, he was part of the team that launched Eton Park Capital Management and before then, at McKinsey & Co. Mr. Kalir holds degrees from Stanford, Oxford, and Yale Law School.
48
Senior Management
John W. Cooper - Chief Executive Officer
Gettysburg College: BA Computer Science; Columbia Business School: MBA
John Cooper is the Chief Executive Officer of Coverago. Mr. Cooper has over a decade of experience in finance and software and was most recently an Investment Banker with Bear Stearns & Co. in their Technology, Media, and Telecom group. Prior to that, Mr. Cooper held engineering and sales management positions with Plumtree Software.
Stefan M. Lehmann - Vice President, Operations
Cornell University: BA Government; Columbia Business School: MBA
Stefan Lehmann joined Coverago in 2008. Mr. Lehmann has spent over seven years in financial services. Most recently, Mr. Lehmann was an Investment Banker at Lehman Brothers, first with their Global Technology group and later in the firm’s Debt Capital Markets division. Prior to that, Mr. Lehmann was at Morgan Stanley in their Global Capital Markets division.
David Yang – Vice President, Engineering
University of Illinois: BS Electrical Engineering
David Yang is VP, Engineering at Coverago. Prior to Coverago, David Yang led the technology infrastructure development team at Gilt Groupe. Mr. Yang also served as Application Architect at RecycleBank, a Kleiner Perkins-backed start-up. Previously, Mr. Yang spent time as an engineer at Yahoo! and practiced as a consultant at Deloitte Consulting.
49
Counsel
Jason Gabbard –Counsel
University of Louisville; University of Virginia Law School: JD
Jason is a partner at Gabbard & Kamal LLP, where he advises businesses, financial institutions and individuals across multiple industries including finance, real estate, fashion, film, music, and theater. Jason began his legal career with Cravath Swaine & Moore in New York. At Cravath, Jason was involved in a number of notable transactions, including IPOs, mergers, stock and asset acquisitions and sales, joint ventures, and debt issuances. After Cravath, Jason worked at Morgan Stanley’s MSREF private equity fund in London. At Morgan Stanley, Jason managed a group of London-based lawyers and bankers responsible for closing billions of dollars in private equity transactions throughout Europe and Asia.
Douglas Lichtman - Counsel
Duke University: BS; Yale Law School: JD
Douglas Lichtman joined the faculty of UCLA School of Law in 2007 after a tenured teaching career at the University of Chicago. His work has been featured in numerous journals including the Journal of Law & Economics, the Journal of Legal Studies, the Yale Law Journal, and the Harvard Business Review. He co-authored Telecommunications Law and Policy, a textbook that investigates the federal regulatory regime applicable to broadcast television, cable television, radio, telephony, and the Internet. He also regularly writes in the popular press, with recent pieces appearing in the Los Angeles Times and the policy magazine Regulation.
50
Finance
Scott Kenerly – Director, Finance (Consultant)
University of North Carolina - Chapel Hill: BA Economics, MA Accounting; New York University: MBA
Mr. Kenerly has over a decade of experience in finance and accounting, including work with early-stage media companies. Prior to Coverago Scott was an Investment Banker at Bear Stearns & Co. in their Leverage Finance group. Prior to that he was a Senior Manager in Forensic Accounting and Valuation, first for Arthur Andersen LLP then with Navigant Consulting Inc.
51
Product Management
Natalie Somekh – Director, Product Management (Coverago News - Distribution)
University of Cambridge: MA Economics; Harvard Business School: MBA
Natalie Somekh joined Coverago as a Director of Product Management, reporting directly to the CEO. Prior to Coverago, Ms. Somekh was an international equities investor at hedge fund, Millgate Capital, in New York. Prior to that she worked in London at private equity fund, Duke Street Capital, and in investment banking at Merrill Lynch.
Jonathan Drillings – Director, Product Management (Coverago News – Creation)
Duke University: BA Biomedical Engineering
Prior to Coverago, Jonathan spent 3 years at Investor Growth Capital (IGC), a growth-stage venture capital firm, and subsidiary of Investor AB. Prior to IGC, Jonathan spent time with Lake Street Capital, a secondary-direct venture capital firm, and Sonenshine Partners, a New York-based M&A boutique investment bank.
52
Operations & Human Resources
Kevin Baxpehler – Director, Operations EMEA
IDC Herzliya: BA IT Management; New York University – Leonard N. Stern School of Business: MBA
Kevin Baxpehler joined Coverago in 2009 as Director of Operations for EMEA. Previously Mr. Baxpehler was an Investment Banker with Credit Suisse in their Leveraged Finance Group. Prior to that he was a Research Manager for the Gerson Lehrman Group and before that he was a Co-founder of a software start-up.
Abby Beal - Associate, Operations
Brigham Young University, BA; Columbia University, JD
Abby Beal is an Associate in Research and Operations at Coverago. Prior to Coverago, Abby Beal spent six years practicing law at the law firms of McDermott Will & Emery LLP and Stroock & Stroock & Lavan LLP. Ms. Beal focused her practice primarily on corporate reorganizations, creditors’ and debtors’ rights and bankruptcy proceedings.
Katie Lai – Director, Global Human Capital Development
University of California, Davis: BA Chinese Language
Katie Lai is Director, Global Human Capital Development at Coverago. Prior to Coverago, Ms. Lai lead finance and product marketing recruiting for Palm. Previously, Ms. Lai was a search consultant for Korn/Ferry International’s Legal Center of Expertise and the firm’s Industrial Practice.
53
Engineering
Chris King - Software Engineer
University of Massachusetts Lowell: BS Computer Science, Mathematics (magna cum laude)
Chris King joined Coverago in 2008 to become Coverago's first Software Engineer. Prior to Coverago, Mr. King interned with EMC Corporation's Advanced Development group as a developer and technology analyst. Previously, Mr. King also interned with the University of Massachusetts Lowell's PeopleSoft migration project, initially as a technical writer, later as a system tester, and ultimately as an internal tool developer.
Ankit Malhotra - Software Engineer
RNSIT Bangalore: BE Computer Science; Columbia University: MS Computer Science
Ankit Malhotra joined Coverago as a Software Engineer in early 2009 and in this time has worked on a variety of projects impacting both internal and external Coverago applications. Previously, Mr. Malhotra interned as a Software Engineer at NextJump, NY.
Marcus Brito — Software Engineer
Faculdade Ruy Barbosa (Brazil): BS Computer Science
Marcus Brito is a senior software engineer at consultancy firm e-Core International. Currently fully dedicated to Coverago, Mr. Brito has previously rendered services to Bunge North America, Health Plan Services and others. Prior to e-Core, he has worked as a software engineer for mobile carrier Vivo, and other software development companies before that.
54
Engineering
Keehwan Park – Software Engineer, Engineering
Carnegie Mellon University: BS Physics and Computer Science
Keehwan Park joined Coverago as a Software Engineer in early 2009. Mr. Park has participated in the front-end and back-end development of Coverago News, Documents, and Transactions.
55
Business Development Directors
Cameron Kirby
Harvard University: AB Psychology
Prior to joining Coverago, Cameron was a Vice President at Sorin Capital Management, a hedge fund focused on commercial real estate-related securities. In addition to his role on the Investment Committee, Cameron was responsible for Sorin’s interest rate and foreign exchange strategies. Prior to Sorin, Cameron was an acquisitions analyst at Tishman Speyer and a legal assistant at Shearman & Sterling.
Joshua Lurie
George Washington University
Most recently Joshua co-founded Soundboard Review Services, a corporate governance board advisory service. Prior to co-founding Soundboard, Joshua was Vice President of Business Development at Salary.com, a leading provider of on-demand compensation data, payroll, and talent management solutions. Prior to working at Salary.com Joshua was a Vice President of Compensation Consulting at Aon Consulting, where he co-managed the eComp Data Services business, which he founded and sold to Aon Consulting in 2001. Prior to founding eComp Data Services Joshua co-managed a market data group in the Investment Banking Division at Smith Barney.
56
Business Development Directors
Jared Shapiro
University of Wisconsin-Madison: BA Political Science; Benjamin N. Cardozo School of Law
Jared came to Coverago following a career in Insurance and Law. Jared was an owner of Property Title Group, LLC, a title insurance company focused on commercial real estate matters throughout the United States.
Michael Wolverton
University of Pittsburgh: BS Finance
Prior to Coverago, Michael was the founder and CEO of Axial Market, a leading marketplace for privately-held companies. Before creating Axial Market, Michael worked as the Director of Business Development for the private equity firm LLR Partners. Michael began his career at Penn Capital Management.
57
Selected Global Media Analysts
Olga Bermant – GMA, German & Russian marketOxford University: BA Modern Languages & Literature
Olga Bermant joined Coverago in 2010 as a GMA covering the German market. Previously, Ms. Bermant was a Fellow with Israel’s Antitrust Authority. Prior to that she worked as a project leader and researcher at ILI – I Like Israel, the Washington Institute for Near East Policy, Israel’s Embassy in London and the Pushkin Institute of Russian Literature in St. Petersburg. Olga speaks German, English and Russian and has basic knowledge in French, Italian and Hebrew.
Shelley Granek – EditorUniversity of Melbourne: BCom Finance & Economics
Shelley Granek joined Coverago in 2010 as an Editor. Prior to joining Coverago Ms. Granek worked for ANZ Banking Group’s Institutional Division in Melbourne and before that supported the management team of Forex Capital Trading. She is bilingual in English and Hebrew.
Ying Zhu Chin – GMA, Chinese marketNorthwestern University: BSc Computer Science and Poetry in Creative Writing ; New York University: MA in Humanities and Social Thought
Ying Zhu Chin joined Coverago in 2010 as a GMA covering the Chinese market. Prior Ms. Chin's worked as a software engineer at Northwestern and as managing editor for a poetry magazine. She speaks English, Chinese and Malay.
Babatunde Anjorin – GMA, English & African marketsColumbia University: BSc Civil Engineering, minor in Economics; SUNY GENESEO: BA Physics & Mathematics
Babatunde Anjorin joined Coverago in 2010 as a GMA covering English and African markets. Mr. Anjorin previously worked as an analyst for Accenture in Nigeria. Prior to that, he co-founded and developed a petroleum marketing start-up in Nigeria. He is bilingual in English and Yoruba.
58
Section 6b:
Usage Case Studies
59
Different types of customers can use Coverago News in different ways
Coverago News: Usages
Receive new relevant news regarding companies and themes (re: existing or prospective investments)- Valuation impacting news, event monitoring, thesis exploration, identification of potential
investment, understanding competitive landscapes, market and macroeconomic research Historical roll ups help with due diligence on investments, markets or prospective management teams Watch list compliance—investors who are restricted because they have been informed of MNPI are
able to see the moment when the news become public, correspondingly releasing their restriction Investor relations is aided in managing reputational risks by learning or press mentions efficiently and in
a timely manner Bankers stay informed of their clients’ news and activities, as well as news that can impact their clients
(e.g. competition, regulation, macroeconomics). Helps with:- Client servicing; deal idea generation; generating ideas for new potential target clients
Immediate monetization opportunities for traders as relevant news is broken faster than other sources Research stays informed of news relevant to their coverage and rollups help with thematic studies Lawyers are informed of their client’s issues and areas of interest (often before their clients are aware),
and can stay informed of regulatory changes Know client checks Marketing support—we enable professional service firms to know their clients and their issues through
access to previously inaccessible local news Corporate communications officers can stay informed of strategic and reputational risks regarding their
firm in a timely manner, and have time to deal with issues and events that arise Product managers can obtain insight into local markets and competitors’ products Corporate strategy and development professionals stay informed of competitor and market news, and
can help identify inorganic growth opportunities
Monitoring media for their clients
Informing policy makers of public sentiment abroad, insight into issues and risks
Investment ManagementHedge funds, private equity, sovereign wealth, retail investors- Research analysts- Portfolio managers- Investor relations (1)
- Library (1)
Banks- Investment banking- Sales & Trading- Research (1)
- Library (1)
Law Firms- Legal professionals- Library (1)
Corporations- Corporate communications- Branding- Corporate development
Public Relations Firms
Government
(1) Support divisions.
60
Human Intelligence Wins
12-Jan-2011 3:58 AM
New Regulation By Poland's National Broadcasting Council May Decrease Advertising Revenues• Poland's National Broadcasting Council's regulation,
which will come into force on April 28 2011, may cut broadcasters' profits from sponsorship advertising by 10% to 15%, analysts said.
• The new restriction lowers the possible number of sponsorship advertisements displayed during an event and bans sponsors from implementing any items that were previously used for promotional activity.
Source (Polish): Gazeta Prawna [Link]
2-Nov-2010 7:28 PM
FTC Approves Modified Intel Settlement Order• Following a public comment period, the Federal Trade
Commission has approved a modified settlement order resolving charges tat Intel Corp. illegally stifled competition in the market for computer chips
• The FTC modified the order to allow Intel to ship this product until June 2013, though all future generations of this chip must fully comply with all specifications of the final order.
Source (English): FTC.gov [Link]
TVN SA: Impact ofRegulatory Change Intel: FTC Investigation
Price movement in Intel stock without related news being released
GMA pieced together a previous story and found a release on the FTC that had not been picked up anywhere else
The Polish government announced a series of sweeping regulatory changes regarding TV commercials.
Although TVN was not mentioned in any of the news articles regarding the regulatory change, our GMA immediately understood the negative impact the new regulations would have for TVN SA and created a summary of the article.
Defection of the Governor of the People’s Bank of China
Zhou Xiaochuan, governor of the People's Bank of China, was rumored to have defected to the U.S.
The Chinese government cracked down on media reports containing mentions of Zhou's name.
On the Internet, Chinese netizens were able to carry on discussions of the topic by substituting a character in Zhou's name with another Chinese character that sounded similar, but that had entirely different meanings. 周小川 became 周小串 , and netizens effectively bypassed state censorship.
A computer program would have a hard time quickly figuring out witty or arbitrary permutations of terms invented by China's censored population as needed.
CCM Stock Price Performance
61
Related Coverago News Summaries
20-December-2010 Coverago News: Health Industry Praises New State Policy
29-December-2010Seeking Alpha: 15 BRIC Stocks Being Snapped Up by the Smart Money
25-January-2011Coverago News: Ministry of Health Announces Approval of Foreign Joint Ventures for Medical Institutions
(13.8%)
20-December-2010
Health Industry Praises New State Policy
Summary:
• According to reports, a State Council paper aimed at removing barriers for private investment in the mainland could change the status of public hospitals and increase the presence of private hospitals, creating a more dynamic health care market in China overall.
• Wholly foreign-owned hospitals and clinics will soon be allowed in pilot cities under a more lenient approval processes.
• According to GuXin, professor at Peking University's Government Administration School, the paper represents a "dramatic breakthrough in the area of market-entry de-regulation," and will lead to an increase in the number of private medical service providers in the market.
• This could potentially mean more competition for Concord Medical Services, which competes with both public and private hospitals that offer radiotherapy and diagnostic imaging services.
• In addition to various promises addressing the needs of private hospitals, the paper also said that non-profit hospitals would receive the same types of tax wavers as public, government-run hospitals.
• FengZhengchun , a professor at Huazhong University of Science and Technology's College of Medicine and Health Management, believes that rather than competing with public hospitals, which still have the best doctors and equipment, private hospitals must specialize in providing certain types of medical care.
Source (English): South China Morning Post [Link]
20-December-2010
Ministry of Health Announced Approval of Foreign Joint Ventures for Medical Institutions
Summary:
• On January 25, 2010, China's Ministry of Health announced that it approved policies allowing wholly-owned joint ventures to be formed between domestic healthcare institutions and foreign healthcare institutions in an effort to encourage development and growth within China's healthcare system.
• The joint ventures or partnerships must be approved by the Ministry of Health and can be either for-profit or non-profit.
Source (Chinese): Ministry of Health [Link]
Fundamental Investor Case Study: Concord Medical
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NATO Takes Over Libya No-Fly Zone
Macro Investor Case Study: Malta Air Traffic Control
While the UN was debating whether to support Libya’s rebels with air support, NATO was getting ready
Malta’s air space had to be crossed by NATO’s planes before any attack. Coverago’s GMAs therefore listened to
Malta’s air traffic control to ensure the earliest possible news coverage of an impending assault
Coverago News was the first media source to publicize that French aircrafts started flying high-speed-low-
altitude flights and that UK jets were taking a combat approach
Coverago News was also the first English source to announce the participation of two Gulf State countries in
the attack on Libya, translated in real-time by our Arabic speaking GMA
Coverago News used multi-language teams to track geo-political events for a commodities trader, leveraging every possible source to provide our client with a competitive advantage. This was a showcase for the creativity of Coverago News –
demonstrating the broad range of sources and intellectual resourcefulness of our GMAs.
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Pfleiderer AG CEO Related Events from December 24, 2010
Trading Case Study: Pfleiderer AG
3:31 AM ET: Pfleiderer's CEO Hans Overdiek sold 41,500 shares amidst the difficult times faced by his company
The shares were sold at € 2.75
Pfleiderer has a very substantial amount of debt, which has forced the company to close down 3 of its plants in Germany
Earlier this week, Pfleiderer signed a standstill agreement with its lending banks which gives the wood manufacturer until March 2011 to restructure its financial situation
3:40 AM ET: Hans Overdiek, has sold an additional 74,990 shares
Overdiek sold almost the same amount of shares in late 2009 but earned three times the amount in 2009
It was unclear why the CEO decided to sell his shares at the present time, as the share price was significantly lower than what Overdiek had paid for the shares at the time of purchase
Pfleiderer announced on February 8th, that it would be posting a loss for fiscal year 2010 – explaining Overdiek’s sale
Shares fell 32% from December 24th through the loss announcement. From December 24th through today this story has not been covered by Bloomberg or Reuters.
12/27/2
010
1/3/2
011
1/10/2
011
1/17/2
011
1/24/2
011
1/31/2
011
2/7/2
011$1.50
$1.70
$1.90
$2.10
$2.30
$2.50
$2.70
(32.0%)
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2011 Congressional Investigation and Hearing
Legal Case Study: Former Governments in Nations Surrounding Russia
A large, global law firm requested coverage of two clients, who were under Congressional investigation regarding their dealings with former governments in nations surrounding Russia
The companies, along with the U.S. Department of Defense, were accused of having corrupt dealings with prior regimes
Coverago’s client requested coverage of clients and individuals related to the clients – effectively any news at all related to the clients
This type of research is incredibly time consuming and difficult for a law firm to do internally
Given the global footprint of the case, Coverago News was able to add a level of depth not available at competing firms
The Coverago News client was able to defend the clients successfully
Coverago News was a trusted resource for the law firm in a high profile case involving the U.S. and foreign governments. This was a showcase for the power of Coverago News – in depth, real time news in several languages created custom for out
clients and impactful in its results.
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Due Diligence on companies, management and board members
Private Investigator: 12 Deep Dives
A large private investigator approached our company for help with his
due diligence process on international transactions
Coverago’s objective was to help his client assess counterparty risks,
political connections and any other kind of potential liabilities a
potential partner or acquisition target could have
Coverago’s GMAs created historic deep-dives going back 5 years
Sources included chat forums, blogs, national newspapers and
especially local archives to reveal any predicaments the company,
board or management may have been involved in
These reports uncovered local lawsuits, charges and unorthodox business dealings business dealings
Coverago’s Spanish GMA team went back 5 years
searching through local newspaper archives,
blogs, and court documents
Coverago’s research team uncovered numerous
offenses and legal liabilities by senior
management and board members
Among them:
The principal of the company tried to bribe a
former major of a small town
A Director of the company was accused of
forcefully taking possession of land for personal
use
A blog published a document showing a second
Director who misappropriated funds from a
water company of which he was a board member
Example: Acquisition Target in Peru
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Crisis: Fukushima Daiichi nuclear power plant
Crisis Management Case Study: Fukushima
A global Public Relations firm hired Coverago to provide local media insight for their client, a multi-national industrial company with reputational risks from the fallout of the Mark 1 containment facility at the Fukushima Daiichi nuclear plant
The company has been using the service extensively as a source for internal research distribution, which is critical in reacting to the crisis situation and planning for continued developments
Example of breaking real-time coverage:
30-March-2012 12:02 AM EDT
Former GE Employee Points Out Fukushima Nuclear Plant Design Weakness:
Summary:
• Former GE employee Dale Bridenbaugh said in an interview with Mainichi Japan that there is a weakness in the design of reactor containment.
• Dale Bridenbaugh was responsible for evaluating the safety of Mark 1 nuclear reactor.• In 1975, Bridenbaugh argued to stop the operation of Mark 1 reactor because the reactor is not designed to withstand the pressure if
the containment lost cooling water.• Bridenbaugh’s supervisor curbed the debate by saying “GE will not be able to sell reactor if we stop the operation in electricity
companies”.• GE improved the structural strength for the containment and installed valves which can decrease the reactor internal pressure after the
U.S. Nuclear Regulatory Commission’s experts pointed out the design problem.
Source (Japanese): The Mainichi Daily News [Link]
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Section 6c:
NewsMercato Screenshots
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NewsMercato: Mass Market Delivery of Coverago News
All the integrity of Coverago News is captured in NewsMercato
“Themes” in Coverago News will be “Topics” in NewsMercato
NewsMercato is the first news tool available to all customers – the small to the institutional – that provides human, bespoke reporting and analysis in real time
Existing news products use algorithms as a cheap method of searching companies and themes, but this comes at the expense of quality. Algorithms can:
Exclude relevant information
Include immaterial information and duplicate stories
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NewsMercato: Searchable and Easy-to-Use, Automated Interface
Easy-to-use interface that diminishes the need for direct sales and encourages marketplace participation
Search
Request a quote for something we don’t already cover in the language of your choice
Create a “proprietary” request which will not appear in others’ search results
Limit search to just companies, topics or newsletters
Instantly stop or restart requests, or change email delivery settings
If a request is too expensive, set a price trigger and receive coverage when it becomes affordable
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NewsMercato: Discover or Create Bespoke Newsletters
Discover and edit existing newsletters, or create new ones using search and intelligent suggestions
Example recent newsletters:
Soy in Latin America
Rajat Gupta
Search for existing newsletters and see which requests they are composed of
Drag and drop existing requests from your “manage” tab to create your own newsletters, per iTunes
Share with others to help lower price
Intelligent suggestions help you discover newsletters , or companies & topics to include in your existing newsletters
Edit your own newsletters
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NewsMercato: Dynamic and Transparent Pricing
One, dynamic, market price instantly available for each request, determined by supply and demand Individuals help lower market prices by making recommendations and increasing aggregate demand Customers may be willing to pay less for some requests than others and can set price triggers to begin coverage
when the price becomes low enough
Set price trigger so that if pricing becomes affordable, the client automatically begins receiving coverage
See real time pricing for ongoing news already covered, by language. Request new language coverage for a predetermined price
Buy historical news. See historical dates already covered, by language and request quotes for periods not already covered
Recommend companies, topics and newsletters to increase demand and lower price. Lower prices encourage impulse and more frequent purchases
Receive news alerts when your price trigger has been hit and when pricing changes. If the price falls, the customer benefits immediately. If it increases, customers are notified and only pay the higher price at the end of the month
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NewsMercato: Intelligent Suggestions
Suggestions related to search, past purchases and general popularity automates part of the sales process and diminishes the need for direct sales
Home page suggests company, topic and newsletter ideas based on what’s popular, what you’ve bought in the past, and what your friends are reading
On the Company pages, and throughout the site, related companies, topics and newsletters are suggested
New coverage in other languages is suggested for historical rollups and ongoing news requests
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NewsMercato: Viral Promotion via a Recommendation System
Incentivize existing customers to invite friends, share recommendations and create interesting newsletters available for resale using (1) credits and (2) a promise of lower prices on existing requests
Customers who invite others receive what they spend in their first month in credits
1 company request at average assumed price of $5/day = $150 credit
1 newsletter request at average assumed price of $60/day = $1800 credit
Customers can help lower market prices by making recommendations and increasing demand via email, Facebook and Twitter
Price declines offset by volume increases
Network effects: lower prices boost demand which lowers prices etc
Margin expansion from resale of existing coverage
Facilitates customer base expansion beyond current, institutional, mostly finance clients to other industries and a retail client base
Diminishes the need for expensive and time consuming direct sales
Users encouraged to share newsletters and other requests via email, Facebook and Twitter
Keep track of credits earned from recommendations
Reminder to invite others to NewsMercato to earn credits and lower market prices
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Section 6d:
Creation Technology Tools Screenshots
Initiation: Company & Topic Structured Wiki
Institutionalize and share GMA research and search methods
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Monitoring: QSpace
News Bundles: List of news items generated from company & topic pages
Bundle Queue: News relating to individual requests grouped into separate monitoring queues
For each company and topic request channel disparate news feeds into a single, easily monitored news queue
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The Authoring Tool
77 77
Push the automation envelope to maximize efficiency, throughput and resellability using (1) full text extraction (2) machine translation (3) entity extraction and (4) auto-summarization
The Editing Tool
Maximize quality and relevancy of each news story
Metadata/ Entity tagging
Summary View
Avoid duplicate stories by seeing recent headlines
already published
Full text extraction from original article
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