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Powerblocks = LEGOs + lighting Modular lighting Build your own / customize Change / reconfigure at will Authentic to Max Home lacks great lighting Moving a lot Like building stuff Neck pieces Lighting head(s) Base(s) 2

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The Blockheads 3 MaxNick Ale Ben

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Int. Designer Retailers Design Marketing Cust. Experience Modular lighting/power: Customization Flexibility Re-usability Convenience Smart-home integration Price Design IP Brand Int. designers Acquisition / Retention Self-Service 1. High-end (wealthy) home owners 2. Office build-outs 3. Low-end (IKEA mkt), dorm students Wholesale to Interior designers Asset Sale Value-Driven ( = high end) Version 1 -- 1/11 4

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Int. Designer Retailers Design Marketing Cust. Experience Modular lighting/power: Customization Flexibility Re-usability Convenience Smart-home integration Price Design IP Brand Int. designers Acquisition / Retention Self-Service 1. High-end (wealthy) home owners 2. Office build-outs 3. Low-end (IKEA mkt), dorm students Wholesale to Interior designers Asset Sale Value-Driven ( = high end) 5 Version 1 -- 1/11

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6 Sneaking Into Dorms

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Int. Designer Retailers Design Marketing Cust. Experience Modular lighting/power: Customization Flexibility Re-usability Convenience Smart-home integration Price Design IP Brand Int. designers Acquisition / Retention Self-Service 1. High-end (wealthy) home owners 2. Office build-outs 3. Low-end (IKEA mkt), dorm students Wholesale to Interior designers Asset Sale Value-Driven ( = high end) 7 4. Mid-range home owners Version 1 -- 1/11

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Int. Designer Retailers Design Marketing Cust. Experience Design IP Brand Int. designers Acquisition / Retention Self-Service Wholesale to Interior designers Asset Sale Value-Driven ( = high end) 8 Customization Flexibility 1. Mid-range home owners 2. Office build-outs Version 2 -- 1/18

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Hitting the Phones 9

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Int. Designer Retailers Design Marketing Cust. Experience Design IP Brand Int. designers Acquisition / Retention Self-Service Wholesale to Interior designers Asset Sale Value-Driven ( = high end) 10 Customization Flexibility 1. Mid-range home owners 2. Office build-outs Version 2 -- 1/18

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Int. Designer Retailers Design Marketing Cust. Experience Design IP Brand Int. designers Acquisition / Retention Self-Service Wholesale to Interior designers Asset Sale Value-Driven ( = high end) 11 Customization Flexibility 1. Mid-range home owners 2. Office build-outs Version 2 -- 1/18

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Retailers Design Marketing Cust. Experience Design IP Brand Acquisition / Retention Self-Service Asset Sale Value-Driven ( = high end) Retail Direct online 12 Customization Flexibility 1. Mid-range home owners 2. Office build-outs 3. Young professionals More/less light Directed light Version 2 -- 1/18

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Retailers Flexibility: More/less light Directed light Asset Sale Value-Driven ( = high end) Acquisition / Retention Self-Service Retail Direct online Design Marketing Cust. Experience Design IP Brand Young professionals (20-40 yr old) 13 Version 3 -- 1/25

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Stalking customers at C&B 14

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We Hit the Phones Again 15

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Other progress... 16

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Retailers Flexibility: More/less light Directed light Asset Sale Value-Driven ( = high end) Acquisition / Retention Self-Service Retail Direct online Design Marketing Cust. Experience Design IP Brand Young professionals (20-40 yr old) 17 Version 5 -- 2/8

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Lighting idea

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19 Back To The Drawing Board...

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Maximum Pain. Period. 20

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Kids Asleep. Parents Happy. 21

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The Product 22

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The Product 23

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Better lighting thru flexibility: -More/less light -Directed light -Online ads -Prod. reviews Young professionals (20-40 yrs) -Online direct and mass market 24 Outsourced: mfg, fulfillment, support Distributors: Retailers Design Marketing Cust. Experience Design IP Brand Asset Sale Value-Driven ( = high end) Version 5 -- 2/8

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model -Baby stops crying -Baby goes to sleep -PR, blogs, WOM -New parents (baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model -Baby stops crying -Baby goes to sleep -New parents (baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model -Baby stops crying -Baby goes to sleep -PR, blogs, WOM -New parents (baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model -Baby stops crying -Baby goes to sleep -PR, blogs, WOM -New parents (baby

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Talking to More Parents 29

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model -Baby stops crying -Baby goes to sleep -PR, blogs, WOM -New parents (baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model -Baby stops crying -Baby goes to sleep -PR, blogs, WOM -New parents (baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model -Baby stops crying -Baby goes to sleep -PR, blogs, WOM -New parents (baby

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Babies Outgrow Stuff Fast 33

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model -Baby stops crying -Baby goes to sleep -Blogs, WOM -New parents (1st baby, baby

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Babies Outgrow Stuff Fast 35

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To The Future? 36 Car simulator Now Netflix for baby stuff 2 years Online product rental? 5 years

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams So heres where we ended up Outsourced: mfg, fulfillment Design Marketing Cust. Experience Design IP Brand 37 -Blogs, WOM -New parents (1st baby, baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Question 1: Can we build it? Outsourced: mfg, fulfillment Design Marketing Cust. Experience Design IP Brand 38 -Blogs, WOM -New parents (1st baby, baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Question 2: Do the costs work? Outsourced: mfg, fulfillment Design Marketing Cust. Experience Design IP Brand 39 -Blogs, WOM -New parents (1st baby, baby

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40 So... what have we learned?

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BUSINESS MODEL CANVASSES 45

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Int. Designer Retailers Design Marketing Cust. Experience Modular lighting/power: Customization Flexibility Re-usability Convenience Smart-home integration Price Design IP Brand Int. designers Acquisition / Retention Self-Service 1. High-end (wealthy) home owners 2. Office build-outs 3. Low-end (IKEA mkt), dorm students Wholesale to Interior designers Asset Sale Value-Driven ( = high end) Version 1 1/11/11 46

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Int. Designer Retailers Design Marketing Cust. Experience Customization Flexibility Design IP Brand Int. designers Acquisition / Retention Self-Service High-end residents Mid-end Interior designers Asset Sale Value-Driven ( = high end) Also looking at commercial lighting 47 Version 2 1/18/11

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Retailers Design Marketing Cust. Experience More/less light Directed light Design IP Brand Acquisition / Retention Self-Service Young professionals -Retail -Direct online Asset Sale Value-Driven ( = high end) Version 3 1/25/11 48

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Retailers Design Marketing Cust. Experience Flexibility: -More/less light -Directed light Design IP Brand -Trade show -Online ads -Design mag. Young professionals (20-40 yrs) -Retail -Direct online Asset Sale Value-Driven ( = high end) Version 4 2/1/11 49

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment, support Distributors: Retailers Design Marketing Cust. Experience Better lighting thru flexibility: -More/less light -Directed light Design IP Brand -Online ads -Prod. reviews Young professionals (20-40 yrs) -Online direct and mass market Asset SaleValue-driven Version 5 2/8/11 50

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment Design Marketing Cust. Experience -Baby stops crying -Baby goes to sleep Design IP Brand -PR, blogs, WOM -New parents (baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment Design Marketing Cust. Experience -Baby stops crying -Baby goes to sleep Design IP Brand -Blogs -WOM = referrals -New parents (1 st baby, baby

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Key PartnersKey ActivitiesValue PropositionsDemand CreationCustomer Segments ChannelsKey Resources Cost StructureRevenue Streams Powerblocks Business Model Outsourced: mfg, fulfillment Design Marketing Cust. Experience -Baby stops crying -Baby goes to sleep Design IP Brand -Blogs -WOM = referrals -New parents (1 st baby, baby

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54 zuck@stanford.edustaubach@stanford.edupalan@stanford.edubwil@stanford.edu