Executive Summary
Split is an app that uses image recognition technology to scan bills and let people split their shared expenses quickly, easily, and accurately. During group dinings, it is difficult and time-consuming to manually charge people and calculate the tax based on the food each person orders. With Split, our customers simply take a photo of their receipt. The app will itemize the bill and prompt users to select what they ordered. Users can pay through direct deposit, linked credit cards, Venmo, or PayPal. By offering a seamless way of splitting bills in virtually any combination, Split replaces the antiquated practice of math at the dinner table.
Though Split can be utilized in nearly any application that requires sharing a bill, our initial marketing strategies focus on dining applications for university students. As Split was founded and is currently operated by five executive members at the University of Pennsylvania, we know our customers because we are our customers. We will set up booths at local universities, encourage promotions with restaurants, and use targeted advertising on popular social media platforms such as Facebook, Twitter, Instagram, TikTok, and YouTube.
To retain customers, we offer a rewards program. Each time a person uses the Split app, all payers in the group earn points that can be redeemed for coupons at certain restaurants. This program would require partnerships with restaurants. This would incentivize customers to keep using the app in order to keep earning rewards. Users can also earn rewards for inviting friends to join the app, allowing us to use referrals to grow the Split user base.
Attracting customers through Split’s free download and no-charge operating promise, we will generate revenue through selling ad space on the app. We will also offer a monthly premium subscription service. Premium members will have ads disabled and will have access to more exclusive coupons.
We will develop our app and user interface in-house. In addition, we will also develop and patent a bill scanning algorithm based on an enhanced Optical Character Recognition technology. It will allow us to do what other bill-splitting apps currently don’t: take a photo of a receipt, then “read” that receipt and translate the items and prices into selectable options on-screen.
To ensure the simplicity and user-friendly interface of Split, we are going to hire a Product Manager with good UI/UX experience. We will make sure that all developers adhere to and are mindful of our design requirements. Since an efficient image-recognition algorithm is the key value of our product, we are going to hire an ML specialist for a 4-month contract. During that 4-month period, we will also hire a Mobile Engineering Intern, and together with our CTO who is a Full-Stack Engineer, they will develop a prototype of our app. In the second year, we will expand to 3 mobile, 1 front-end, and 3 back-end engineers. The app will be available on Android, iOS, and the web.
Split’s Executives are very experienced in ventures and startups. Our CEO, Jacqueline Bruder, has been working for H Venture Partners as an analyst for the past 5 months and is also a part of the UPenn Women’s Soccer team, so he has a lot of experience working with teams and is a very organized, hard-working leader. Kevin Lu, our CFO, has a heavy background in investing and has worked in various fields of finance for companies including Moelis & Company, and P. Schoenfeld Asset Management, Sreshta Ravikumar, our CMO, has worked as a freelance writer where she helped promote many brands by creating product promotions, biographies, and blog posts. She was also an analyst at both IQVIA and Eversana Management Consulting, Our COO, Yunqi Xu, was the Co-Director of Business Development of Petal Inc. where she helped her team of 6 develop a market entry strategy for a seed-stage medical device startup. She will be a great asset in cultivating organization in the day-to-day operations of Split, Inc. Our CTO, Damian Krupa, authored his first profitable software when he was 12 and led its development for 6 years. He also worked as a Software Engineer in a Polish startup for 3 years and gained DevOps experience doing 2 internships in Silicon Valley.
With our financial forecast for the future 5 years, we expect our operating expenses to start at $530,000 in year 1 and grow to $4,900,000 in year 5. In the first year, our team will work from a virtual setting; therefore, the expense will primarily be covering the salaries. As we grow into the second year, we will expand into a team with 30 people and move into an office in Philadelphia; therefore, the expense starting from the second year will cover salaries, rent, equipment, and other costs. Our net revenue will start at $150,000 in the first year. With extensive marketing effort, we expect our number of users to grow 3.5 times a year and reach a revenue of $22,300,000 in year five. Our earnings over the first three years are forecasted to be negative; however, the earnings will be climbing over the forecasted timeline and will dramatically increase over the fourth and fifth year as we increase our customer base. With our expansion, our revenue is forecasted to reach $10,400,000 by the end of year five.
The forecasted income statement for Split over the future five years.
We plan to seek two rounds of funding from VCs and angel investors. In year one, we will seek a series A funding of $1,000,000 to hire engineers and support further product development and market research. In year two, we will seek a series B round for $2,000,000 to expand our team and increase our customer base. As return, we will provide 20% of ownership for each round with an interest rate of 40-50%. We aim to provide a return on investment by eventually being acquired by a payment company such as Venmo.
Log in or sign up for Devpost to join the conversation.