Our Big Goals to Make History

1. Run rate of $250M through discounted sporting goods sales
2. De facto platform for all sports highlights - both user generated and professional
3. Sponsor and host major sporting events like the X Games
4. Help people rediscover their passion for sports every day just by opening our app
5. Record some of the highest engagement numbers on mobile for a social or e-commerce platform

FAQ's

• Q: Where do you see action sports in 5 years?
• A: Action Sports has gained significant traction on a global scale. For the first time this year, the X Games were held outside the US because of the widespread popularity of these sports. In 5 years, we expect the number of Action Sports athletes and fans to skyrocket. Snowboarding has already made it into the Olympics. We’d like to think that by 2018, there will be almost half a billion participants in Action Sports.
• Q: Why would people switch from Instagram or Twitter to use your service when all of their friends are already there?
• A: XS isn’t a replacement for those apps. They serve a great purpose for a very wide audience. Our platform is for sports fanatics to connect with each other over content that’s related specifically to their interests. That’s why dedicated communities are great - everyone is there for the same reason, and it makes sense to share more content, more often.
• Q: What is your biggest competitive threat?
• A: Companies are often defeated because of their inability to execute rather than a competitor squashing them. Knowing this, we realize we must execute on our marketing strategy effectively to have a shot at early success for the business. Looking outside ourselves, ThrillOn is a close competitor, but their slow growth has stalled out at 70k uniques per month. Fanatix is growing at an incredibly high rate, but their focus is primarily soccer in the European market.
• Q: Why are you looking for investment at this stage? Why not wait until you have more traction after launch?
• A: Once we launch, we want all of our focus to be on marketing the business. If we have to raise money after launching, it will take away from the time we can dedicate to growing and supporting the community. This round will give us enough runway for 2014 so we can get to market and hit the goals we have laid out.
• Q: Who is most likely to acquire you and why?
• A: Yahoo, ESPN, and Fox are three big players that could acquire us. Yahoo has acquired nearly 20 companies this year, and is making a big push for hot apps that are content driven. They also have a strong focus on sports, and have acquired other companies in related spaces; such as Bleacher Report. Fox is launching its own sports network, and our business could be a great channel to promote their own content and interact with users. As a fully built product with an active community, GoPro and RedBull could be acquirers of our business because we would help their brand image, distribution of their content, and engagement with new/existing customers.

Market Stats

Industry Articles and Information:

• Talk about too much content...100 hours of video uploaded to YouTube every minute
• 40% of YouTube views come from mobile
• Fab and Thrillist see 50% sales coming from mobile ( Fab | Thrillist )
• Action Sports accounted for $500M of rev. for Nike in 2012 (source: 2012 Annual Report)
• Nike expects Action Sports sales to reach $1.2B by 2015
• VF Corporation had almost $11B in rev last year, half of which came from Action Sports (source: 2012 Annual Report)
• 5 of the top 10 brands on Instagram are sports-related or have action sports divisions
• GoPro sold 2.3M cameras in 2012, expecting to double that figure in 2013
• US Census reports 270M sports participants
• Two-thirds of mobile video is watched on iPhones

Recent investments in sports and e-commerce:

• Andreessen Horowitz and Insight Venture Partners invest $150M in Fanatics at $1.5B valuation
• Fanatix raises $3M and sees 1M active users
• Fab raises $150M at $1B valuation
• ZOZI, the Action Sports lifestyle marketplace, raises $10M

News Sources:

• Action Sports participants
• 300 Million iPhones sold to date (Source: Apple Financials)
• >500M photos shared on social networks each day ( Facebook | Snapchat | Instagram )
• Ecommerce passed $1T this year, expected to grow to $1.3T by 2016
• Action Sports market size ( Reuters | ACG )
• Retail Sporting goods market size

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