NEW PARADIGM OF FOREIGN EXCHANGE MARKET

CEO

INVESTOR

윤형운

BUSINESS PLAN

• Exchange fee

• Very high commission for nonmainstream currency (main:1.9~3% ,

non-main:5~19%)

• Oversea ATM withdrawal fee

Background

Complicated and excessive commission

• Even though no. of tourist

to Southeast Asia has been surging, still lack of nonmainstream currency exchange booth

Difficulties of exchange nonmainstream

currency

• Low-interest policy

Japan - 0.10%, Korea 1.25%, Hong kong 0.75%, Taiwan 1.375% • Additional revenue

Economic depression & Low-interest policy

1% of very low commission

After arrival to tour destination, searching the closest exchange spot or in the airport

Yearly 72% of commission income

BUSINESS PLAN

Background: Spread by currency

currency

BASIC

EXCHANGE RATE

(KRW)

BUY (KRW) BUY

(SPREAD %) SELL(KRW)

SELL (SPREAD %)

미국 USD 1,125.50 1,145.19 1.75 1,105.81 1.75

유로 EUR 1,264.44 1,289.60 1.99 1,239.28 1.99

일본 JPY 1,100.14 1,119.39 1.75 1,080.89 1.75

중국 CNY 168.35 178.45 6.00 159.94 5.00

홍콩 HKD 145.07 147.95 1.99 142.19 1.99

스웨덴 SEK 132.45 135.76 2.50 129.14 2.50

덴마크 DKK 169.87 174.11 2.50 165.63 2.50

노르웨이 NOK 136.89 140.31 2.50 133.47 2.50

아랍에미리트공화국 AED 306.42 318.67 4.00 281.91 8.00

싱가포르 SGD 825.60 846.24 2.50 804.96 2.50

말레이시아 MYR 274.01 290.45 6.00 257.57 6.00

태국 THB 32.23 34.16 6.00 30.30 6.00

인도네시아 IDR 8.57 9.25 8.00 7.55 12.00

인도 INR 16.82 18.33 9.00 15.31 9.00

러시아 RUB 17.36 18.74 8.00 15.46 11.00

대만 TWD 35.43 38.61 9.00 32.95 7.00

베트남 VND 5.05 5.65 12.00 4.45 12.00

필리핀 PHP 23.60 25.96 10.00 22.66 4.00

브라질 BRL 342.69 377.64 10.20 315.28 8.00

터키 TRY 377.65 407.86 8.00 347.44 8.00

카자흐스탄 KZT 3.33 3.72 12.00 2.94 12.00

체코 CZK 46.80 50.07 7.00 42.59 9.00

몽골 MNT 0.50 0.59 19.00 0.41 19.00

칠레 CLP 1.68 1.81 8.00 1.55 8.00

*SOURCE : KEB HANA BANK 2016/9/13 22:00 276th exchange rate

BUSINESS PLAN

SERVICE FLOW

(local store)

(tourist)

Request a withdrawal

Local currency

BUSINESS PLAN

SERVICE INTRODUCTION

Q. What is the quickest and cheapest way of foreign exchange?

Q. How can I withdraw money after mobile foreign exchange?

Q. How did exchange fee become so much lower than bank’s?

BUSINESS PLAN

BUSINESS PLAN

SERVICE INTRODUCTION

SERVICE DEMO

Registration Passport

authentication

Send the exchanged amount of

money (HKD)

Search the closest affiliate in tour

destination

Verify change details

Identity authentication with QR code

Withdrawal

(TWD)

[Example of exchange HKD into TWD]

BUSINESS PLAN

SERVICE ADVANTAGE FOR TOURIST

The lowest commission Simple and convenient exchange

The basic exchange rate Safe cash handling

A way of P2P foreign exchange enable to charge 1/10 commission than bank’s

Easy withdrawal in your travel route

with searching the closest affiliate through Cashmallow app

Unlike bank, apply the basic exchange rate when to buy and sell

Withdraw as much money as you want whenever and

wherever that reduce the risk of the loss

TOURIST

BUSINESS PLAN

SERVICE ADVANTAGE FOR LOCAL MERCHANT

Additional revenue Increase the sales

Cash flow Effective marketing tool

LOCAL MERCHANT

Get a 0.2% commission of the exchanged amount as a service charge (Yearly 72% of commission income)

No problems on cash flow, Get the money & commission back in a day

The visitors for withdrawal help the increase of the sales

& floating population

Promote their service, location, menu, other features

to catch tourists’ eye on affiliate profile of the app

BUSINESS PLAN

COMPETITORS

TRANSFERWISE

P2P, Online oversea transfer

WEYS

Direct foreign exchange matching

Bank

Average 5% of commission at monopoly status

Credit card

Average 5~10% of oversea use commission

at monopoly status

X In case of foreign exchange, only possible for

oversea account holder

X the risk of meeting in person

X High commission and hard to exchange nonmainstream

currency

X High commission rate and the risk of duplication crime

BUSINESS PLAN

Market situation

- High commission at monopoly status, customer has no alternative - Passive correspond as limited accessibility & operation hour against fast changing

market situation create new market in financial industry with development of Fintech

Similar case

Transferwise - Monthly remittance is 0.7 billion USD - Market share of oversea remittance have gradually increased due to conservative

action of local bank - Smart consumer: Easily move to alternative not to put up with high cost and

inconvenience

Plans of penetration

- Create new ecosystem with a way of P2P foreign exchange P2P for prior occupation of the market

- Change the way of foreign exchange from Face to face to combination of on-offline to increase satisfaction of customer

- The service meets the customer's needs

COMPETITORS: Bank

BUSINESS PLAN

Cashmallow Bitcoin

Familiarity Real money exchanging Virtual money exchanging

Price 1% of basic exchange rate - Low and transparency fee

Different exchange rate by center

Ex) Official site: 1 bitcoin=724,722KRW

Official site: 1 bitcoin=734,000KRW

2~4 times higher exchange fee than Cashmallow( including 1~3% of fee)

Oversea account Not required.

Mobile app is a wallet for withdrawal and payment anywhere, anytime

Oversea account is required to receive money.

Not appropriate for currency exchange

(High risk of suspension and tax issue by act revision)

BUSINESS PLAN

COMPETITORS: Bitcoin

COMPETITIVE ADVANTAGE

competitive advantage element)

Expandability

Sharing Economy

Patent

BUSINESS PLAN

Sales strategy

1ST

Convenience store in airport , USIM store → first 2 months after

launching

2ND

Popular tourist spot

→ 2~6 months after launching

3RD

Surrounding small town

→ 6~12 months after launching

Objective: Create the rise in the no. of case of exchange and brand awareness to form new mechanism of foreign exchange.

• Convenience stores, USIM stores in airport are essential target of affiliate, because they are usually operated for 24 hours and must-moving path of tourist, moreover their sales are closely related to a floating population

• Recruiting affiliates based on tourist’s essential moving route

BUSINESS PLAN

Marketing strategy

Viral marketing

Target: 20-30s who purchase oversea travel package

• Form partnership with small and medium tour companies and give benefits to company & customer

• Customer enter the promo code received from tour

company, after then they can get 50$ pre-paid coupon

Target: 20-30s netizens who prepare oversea travel

• To increase customer awareness, post reviews about Cashmallow by bloggers who specialize in travel

• Make a viral movie containing the instruction that tell how to do foreign exchange using Cashmallow, then upload on Youtuve, Facebook, popular blog etc

Partnership with tour company

BUSINESS PLAN

Promo code

SNS Marketing

Target: 20-30s SNS users who are interested in travel

• Communicate with SNS users posting the contents related oversea travel and easy money exchange tips

• Increase awareness through executing events and ADs

Target: Professional blogger & existing customers • Make professional bloggers and existing customers doing

voluntarily network marketing activities to save a point by assigned promo code personally

(Give points to new customer and recommender both )

Marketing strategy

BUSINESS PLAN

COMPANY GOAL

Expand into 8 countries in Asia and 3 countries in Europe

by 2018

SALES GOAL : 40 Billion by 2018

Global travel meditation platform - Money exchange, tour guide,

tour reservation etc.

BUSINESS PLAN

HONG KONG TAIWAN

information

• Population 717M • Per capita income USD 39,892 • Tourism revenue 46,031 M.USD • Tourism expenditure 17,500 M.USD

• Population 2400M • Per capita income USD 20,501 • Tourism revenue 17,423 M.USD • Tourism expenditure 15,954 M.USD

Reason to choose

• Vigorous exchange between two countries • The center in the greater china • High GDP, high rate of smartphone user and penetration • Comparatively easier to manage affiliate by high density of population and its limited domain

Incorporation • Incorporation complete • Open business account of

Hangseng bank

• Incorporation in progress • Legal review complete

HONGKONG ↔TAIWAN SERVICE LAUNCHING

출처 : 관광지식정보 시스템 www.tour.go.kr 자료기준 2014년

BUSINESS PLAN

HQ HONG KONG

TAIWAN SUM

Tourism expenditure (M.USD)

17,500.00 15,954.00 33,454.00

1% of market share (M.USD)

175.00 159.54 334.54

Sales forecast (M.USD)

1.75 1.60 3.35

Sales forecast convert USD to KRW

(1USD=1,000KRW) 1,750,000,000 1,595,400,000 3,345,400,000

Fixed annual cost (KRW) 361,920,000 175,200,000 175,200,000 712,320,000

Operating profit (KRW) 2,633,080,000 2,633,080,000

SALES FORECAST

• Operating cost when adding a service country (KRW): 240,200,000 • Sales forecast when adding a service country (KRW): 1,672,700,000

Budget of one additional service country

BUSINESS PLAN

사업계획서

1st completion of angel investment

(KRW 200M ) Development (80%)

2nd angel investment

(KRW 400M)

Lunching in

Hong Kong-Taiwan

(generate revenue)

VC investment

(KRW 2000~3000M)) Service expansion IPO(상장)

completion

FUNDING PLAN

CONCLUSION

4th industrial revolution has already started, Cashmallow will preoccupy mobile foreign exchange market and try to block market penetration of competitors by patent

Share the profit with tourist and affiliate both

Expand service into all over the world without any particular infra

10% of awareness in main target (20-30s) makes distinct being, and 30% of awareness creates the critical point, after then will establish Cashmallow’s legitimacy in the foreign exchange market

The biggest risk is not taking any risk... In a world that changing really quickly, the only

strategy that is guaranteed to fail is not taking risks Mark Zuckerberg

BUSINESS PLAN