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									The Kinkajou




         Prepared by:
       Brigitte Gehring
      Shannon McCarthy
          Brad Sykes
         Luis Vallejo

     Contact Information:
   neil.cantor@sloan.mit.edu




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                     TABLE OF CONTENTS
                                                   PAGES

Executive Summary……………………………………………………………3-4
Problems and Opportunities…………………………………………………..5
       Problems ………………………………………………………………...
       Opportunities…………………………………………………………….
Product Descriptions…………………………………………………………...6-8
       Industry…………………………………………………………………..
       Design that Matters………………………………………………………
       The Kinkajou…………………………………………………………….
Market Research………………………………………………………………..8-12
       Customers………………………………………………………………..
       Market Size and Trends………………………………………………….
       Competition and Competitive advantage…………………………………
       Ongoing Marketing Evaluation…………………………………………..
Marketing and Sales Plan………………………………………………………12-15
       Overall Marketing Strategy…………………………………………........
       Pricing………………………………………………………………........
       Sales tactics………………………………………………………………
       Service and Warranty Policies…………………………………………...
       Advertising and Promotions……………………………………………..
       Distributions……………………………………………………………..
Manufacturing and Operations Plan…………………………………………...15-16
Team Descriptions………………………………………………………………16-17
       Timothy Prestero…………………………………………………………
       Niel Cantor……………………………………………………………….
       Peter Fichter……………………………………………………………...
       Allen Armstong…………………………………………………………..
Financial Plan…………………………………………………………………...17-19
       Cost Assumptions………………………………………………………...
       Market Assumptions……………………………………………………...
       World Education and USAID Proposal…………………………………..
       Financial Conclusions………………………………………………….....
Risk and Contingencies…………………………………………………………19-20
Exit Strategies……………………………………………………………………..20




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EXECUTIVE SUMMARY

One in five adults worldwide does not know to read. In areas like West Africa it is as many as
80% of illiterate women over 15 years of age and roughly 70% of illiterate men. Reading is such
a fundamental asset for anyone, if you know how to write or read you can vote and you know
who you are voting for. If you know how to read you can know the right dose of medication to
give to your sick child. When we spoke with organizations that work in the field of adult
literacy, we found that the two biggest obstacles to teaching adult literacy classes are educational
resources and lighting. Textbooks, unless there is appropriate funding, are donated and passed
through the classrooms, leading to old material and damaged books. Since adults work during
the hours of natural light, they need to take classes at night, where inefficient flashlights and oil
lamps are used to see the texts. Oil lamps and flashlights are used because these educational
problems are in rural communities, very far from an urban center, where access to electricity is
nil. To our knowledge, 38% of Africa’s adult population is illiterate, that is 185 million African
adults.

Adult literacy, defined as a person over 15 years old with reading and oral skills, has strong
connections with students taking a more active role in civic life and politics. Studies also show
that when parents are literate, they become more involved in their children’s education, leading
to an increase in literate persons allowing for an efficient community. Literacy leads to an
improved self-confidence, empowerment, more effective communication skills, improved family
health, more productive livelihoods, and the spread of modern agricultural techniques in rural
areas. All of these benefits lead to a better economy and improvement in the overall standard of
living.

Design That Matters’ (DtM) mission is to improve the quality of life in undeserved
communities. In essence, we do this through product development. We package these problems
as curriculum materials for students and faculty to use in engineering and business courses. The
idea for the Kinkajou is to develop a proof-of-concept that can use microfilm and an LED to
project information so that adult Africans can become literate. It will act like an ordinary
projector, and will allow for sufficient lighting so that a room of up to 60 students can see
clearly. The Kinkajou has been designed to be portable and endure the harsh weather conditions
of Africa. Since power sources are inadequate, the Kinkajou has been developed to run on a car
battery, a main source of power in Africa, or rechargeable solar powered batteries. The
educational material is stored on inexpensive microfilm, which can store up to thousands of
pages of text and pictures. The information on the microfilm can also be custom made for each



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individual classroom. The maintenance for the projector is minute and can be fixed by the end
users.

The cost for the projector is estimated to be US$50. Currently, Fisher Price and other companies
are donating the parts for the projector allowing the price to fit within our customer’s budgets.
Although our end users are illiterate Africans taking night time literacy classes in rural
communities, the major purchasers of the product are international and local African non-
governmental organizations (NGOs), private voluntary organizations (PVOs) and educational
organizations focused on adult literacy because access to rural communities in Africa is
difficult. These organizations are currently working in Africa to increase the literacy rate and
understand the end users needs.

Presently, we have an alliance with World Education, an international private voluntary
organization dedicated to meeting the needs of the educationally disadvantaged, and have
recently sent USAID/Mali, an independent federal government agency that assists countries
recovering from disaster, trying to escape poverty, and engaging in democratic reforms, a
technical proposal (EXHIBIT A) for the Global Alliance for Illumination for Education (GAIE).
We hope to receive assistance and funding from USAID/Mali in order to begin our pilot program
in September 2004. This pilot program will enhance the learning experience of 1500 men and
women enrolled in 45 community-based adult literacy classes across Mali, and enhance the
business potential of a select group of local manufacturers. The pilot will also allow us to better
understand the needs of the end users and the impact of the Kinkajou on student motivation and
learning.

Our strategy to reach other potential customers of the Kinkajou is through guerilla marketing
tactics: direct calling/e-mailing, writing articles in local Boston newspapers and African
Education journals, National Public Radio and attending educational conferences where we can
highlight our product. Using these medians, we hope to achieve a market share of .05%, roughly
a sale of 15,000 Kinkajous by the end of 2006. As we are in the midst of designing and testing
the product, our profitability is difficult to project. Our main focus is to increase education in
African adults, rather than reaping the benefits for ourselves.

There are no direct competitors to the Kinkajou, although other educational resources are used in
the classrooms presently, the projector will be a complementary product to these tools. The
projector will significantly increase the success of educational tools and literacy rates through its
design specifically geared to the present education tools shortcomings.

Right now, Timothy Prestero, Neil Cantor, Peter Fichter, and Allen Armstrong make up the
members of the Kinkajou team. Timothy and Neil are the Principals and cofounders of Design
that Matters. Timothy has an engineering background and has also been a member of the Peace
Corp in Africa. Neil has a strong business education which he brings to the team. Peter Fichter’s
educational background and past job experiences make him a leader in program management and
new product development. Allen Armstrong is the lead design engineer. He is responsible for
designing the Kinkajou to meet the specific needs of the African classrooms. Each one of the
members brings different qualities to the team that will ultimately drive the success of the
Kinkajou projector system.



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5
PROBLEMS AND OPPORTUNITIES

Problems

One in five adults worldwide does not know how to read. In rural regions of West Africa, up to
75% of the population is illiterate. According to Barbara Garner of the World Education
Organization, "It's the lack of resources"—specifically access to books and lighting—rather than
the lack of interest in education that contributes to these numbers.‖ The literacy problem in rural
                                    Africa is abundant and seems to be ever-present, mainly due to
                                    their way of life. In West Africa the population’s day is filled
                                    working on the land. In an agrarian community such as this
                                    one, there is little time left over for recreation. During the day
                                    they work and at night they rest up for another hard day of
                                    work again in the morning. This leaves very little time for
                                    education. With their lack of electricity and their lack of free
                                    time until after dark, there is a big problem when it comes to
                                    learning how to read. Currently the residents of Mali and
Benin have been using lamps, lanterns, flip boards, and flash lights to learn to read at night.
Though it is a step in the right direction it is still a small step. It is hard to educate a room full of
people with one person trying to teach everyone to read without everyone having enough lighting
or books. This is a problem that the Kinkajou will solve, the projector will allow for a room 60
people to be able to learn while paying attention to the teacher at the front of the room. It is
similar to an ordinary projector although it will allow for sufficient lighting so that everyone can
learn to read at the same time.

Opportunities

It is clear that the opportunities of this product far outweigh the problems. This product is battery
powered and the memory storage capabilities will help solve the literacy problems of Africa. The
Kinkajou provides the ability to operate at night by running off a car battery, a main source of
power, or rechargeable batteries. The projector also provides enough lighting for a room of sixty
people to comfortably read and its microfilm can contain thousands of pages of text that will
revolutionize the developing countries educational processes. Due to the fact that many
underdeveloped countries rely on agriculture, they have no choice but to work all throughout the
day. Since they only have the night hours to learn, it is difficult to teach people to read with flash
lights and lanterns, since there is one lighting tool for 3 people. Though Africa is the targeted
country right now, many countries can benefit from the Kinkajou and solve many literacy
problems across the globe. This product will allow developing countries to increase their literate
population since they will be offered a new, revolutionary opportunity to read. This shall
ultimately improve the standards of living for these underdeveloped countries.




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PRODUCT DESCRIPTION

Industry

At the moment Kinkajou will be entering the educational market as a complementary product to
text books, flash lights, oil lamps, flip boards, and chalk boards. A complementary product
means that the Kinkajou will not have to worry about competitors or having a competitive
advantage. In the class rooms it is a supplement to the other learning materials, where the present
education resources will continue to be used by individuals after using the Kinkajou in the
classroom.

Presently the market for education in Africa consists of low cost products that aid in the
education resources and provide light capabilities. The end user, illiterate African adults taking
night time classes in rural communities, market size is 38%, but we do not have sufficient access
to the end users, so we are contacting educational organizations that have classrooms in Africa,
they will be the potential purchasers of the product. This market is abundant as there are over 30
organizations that teach in Africa, and most are in contact with each other, which allows for an
interwoven web of potential customers. Larger organizations, such as UNESCO, World
Education, Save the Children, and World Learning, have vast connections and classrooms in
Africa.

Design that Matters

Kinkajou is a product of Design that Matters (DtM). We are a
Massachusetts nonprofit that helps underserved communities
improve their quality of life by creating products and services
that meet the needs of the communities. DtM works with
NGOs, corporate partners, and local entrepreneurs to ensure
that promising student innovations result in products and
services for communities in need. Since its launch at MIT in
2000, DtM has worked with over 300 university engineering and business students to develop
dozens of prototypes that promise to improve thousands of lives.

The Kinkajou

The Kinkajou Microfilm Projector is an educational tool for developing countries that combines
the efficiency of LEDs with the durability of microfilm. The name "Kinkajou," came from the
nocturnal animal that has tremendous eye shine which can be seen for hundreds of feet. One of
the biggest obstacles for teaching programs in African rural areas is supplying them with books
and lights to read at a low cost. The Kinkajou Projector could be used to project teaching
materials and other images in the dark class rooms where books are too difficult to read under oil
lamp lights and flashlights. The projector’s end users will be illiterate adults in rural villages of




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                                             Africa where literacy rates are high (EXHIBIT B).
                                             Design That Matters will sell the product to
                                             educational organizations that focus their efforts in
                                             developing countries, and the beneficiaries will be
                                              the illiterate adults.


                                            The Kinkajou Projector has been able to resolve the
                                            above problems while meeting Africa’s jagged
                                            weather. While developing the Kinkajou, Design
                                            That Matters has taken into consideration the cost
                                            limitation, size requirements, and harsh weather
environment in which it will be used. It can be driven by a car battery or rechargeable batteries.
It combines revolutionary LED technology with robust microfilm. It not only projects an image
bright enough to be read in a classroom of up to 30 students at night, but all the content is stored
on a microfilm, which can store thousands of pages of text.

This product will greatly reduce educational costs to illiterate African’s because fewer books and
lamps will be needed. The projector is very appropriate for adult education because adults are
much more motivated to learn. As a substitute, some African communities have televisions as
educational tools. But televisions are difficult to power and difficult for a large classroom size to
see. The Kinkajou is easier to transport and is durable. We also decided that a patent for this
product would not be necessary after weighing out the costs and benefits due to its
straightforward design, which can be manipulated and copied.

The Kinkajou Projector is powered by six C-Cell batteries that are recharged using a human-
powered generator, such as a bicycle generator. Since there is no electricity, this attribute will
save the cost of replacing batteries over and over.
Kinkajou's housing was designed using ABS
plastic, a very durable material. Costs are extremely
low for the projector. It is expected to be about
US$50 per unit, with a yearly upgrade that will cost
$2. Design That Matters and its partner are waiting
for the acceptance of a proposal for a budget of
roughly US$400 thousand from USAID/Mali to
help develop and assist with the pilot test in
September 2004. The budget proposal will cover
two years of operations, and the team has spent
about US$120-150 thousand. The spending to date
also includes the time and money that World Education has invested into delivering the product.
In the fall of 2002, a team of 16 fourth-year MIT students developed the Kinkajou Projector
prototype. The first microfilm reader prototype was developed by Dave Lobosco, Saul Griffith
and Timothy Prestero through the 2002 MIT Design that Matters studio course at the Media Lab.

The product features are as follows: Ejection button – for easy cassette insert/removal. Image
projected from front using a 5 Watt cyan LED which provides clear projecting image. Heat sink



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enables system to withstand temperatures of 120F in the harsh weather conditions. Dimmer
allows users to adjust for desired contrast ratio depending on the physical size of the class room.
Focusing knob allows users to achieve desired resolution. Manual indexing knob advances two
pages per rotation for learning flexibility. It has an automatic indexing powered by 6V Motor.
Comfortable handle for easy transport.

In the summer of 2003, Design That Matters and four members of the Kinkajou design team
performed an extensive field study in Mali and Benin. The response to the Kinkajou was very
positive. Several teachers saw potential uses for it and they said that the classrooms could also
be made dark enough to see the Kinkajou during the day. They loved the ease of operation and
felt that they could put all the 5th year books on the cassettes to further cut costs. We were
informed that we needed to make the projector flexible to change the teaching material to better
suit their needs. The size of the projected image was a plus because many African adults have
bad vision and it is difficult for them to read out of books. Overall it was exciting for the
students and teachers to experience the new technology. They felt that the Kinkajou was a
―piece of cake‖ to use and teach with, and the students seemed eager to learn.

We were thrilled with the positive experience in Mali. We successfully delivered a product to a
developing country and cherished the response. We also found ways in which to improve the
Kinkajou. The biggest problem with the device was that the projection is too low and needs to
be raised at least 2 -3 feet so the mothers nursing their babies in the back of the room can see.
One cannot place the Kinkajou on a box to raise the image because it obstructs the students view,
and angling the Kinkajou produces a distorted image; we have redesigned the projector to fix this
problem. The first field test was very encouraging for Design That Matters, but we still need to
drive down the cost, verify the ideal manner of producing content, and determine some means of
local maintenance.

At present, one client, World Education, has been identified as a potential customer for
Kinkajou. World Education has worked closely with the project from an early stage and has
invested heavily in the project. World Education has agreed to take 75 Kinkajous to teaching
projects in rural Mali this September, for a pilot program. The test will last 6 months and put
Kinkajou through the most difficult examination of its design and educational value. The test
offers an opportunity to test the student’s design assumptions and research, as well as bringing
Kinkajou one step closer to a permanent place in the lives of its intended users.


MARKET RESEARCH

Customers

The target market for the Kinkajou is NGOs and international educational organizations situated
worldwide who have programs that support adult literacy in underdeveloped countries in Africa.
Even though the end users of the product will be illiterate African adults in rural areas, the ability
to contact these communities is difficult without the help of the African NGOs.




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The main purchasers of the projector will be NGOs and educational organizations. Our intention
is to sell the projectors to the organizations in which they will continue to pass the projector onto
the communities. It has been brought up to our team by World Education that the projector will
be bought only if the communities can pay for the majority of it. If need be, World Education
will proceed with a cost share, where they will split the costs with the African community. In
our view point, the organizations will be the distributor for the projector, they buy it from us and
can decide what to do with it from that point, whether it be donating it to communities or having
the communities buy it from them.

Presently, we have had a difficult time receiving responses from potential customers. We
understand that we need to speak to the Directors of Education and Literacy Programs, as they
would be the purchasers of the Kinkajou, but it is difficult to find their name on websites. When
calling organizations, it is difficult to receive responses back after leaving voicemails. We will
need to continue to be persistent in contacting potential customers. We have had a few responses
though, all positive (please refer to the ―Contact Booklet‖), who wish to advance the
relationship. We hope to take advantage of our current relationships by using our partner’s
present relationships with other organizations and by using our partner’s name to attract potential
customers.

From the few organizations we have been in contact with, we have determined that the buying
process can take as short as a month to 6 months. It all depends on how quickly their
organization can meet to decide on buying the product and where the product should go,
depending on whether they need funding or not. If they have the funds to purchase the product,
they can proceed, if not a proposal needs to be composed and delivered to a funding
organization. This process could take weeks to months depending on the availability of the
foundation.

Price is the main contingent on whether to purchase the product because our customers and end
users do not have significant budgets. World Education has stated that US$50 is the highest
price that they will pay for the product, seeing that their hopes are the communities will be able
to purchase the product and this is as much as they can afford, as can World Education. Even
though they are funded through private organizations and foundations, this is not an endless
supply and is always an uncertainty.

Presently, we have created an alliance with World Education, an organization designed to meet
the needs of the educationally disadvantaged. They have worked in Mali for over 10 years using
a participatory approach to identify community needs, especially in education. Through our
partnership we have sent a technology proposal to USAID/Mali in the hopes to receive funding
for a pilot program which will launch in the fall of 2004. If the funding is accepted, we will be
sending 75 projectors to 45 communities Mali in September in order to train teachers so a pilot
program can begin in January 2005 for 24 months. Previously, in July 2003 an earlier version of
the projector was brought to Mali and received valuable information on how the projector was
received. In all cases, the novelty of the projector seemed to motivate learners. This January we
will examine whether this novelty endures throughout a three to sixth month period. In addition,
the quasi-experimental design of the intervention will provide sound data on whether the




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students that use the Kinkajou progress faster than students that do not use the Kinkajou. After
completion of the pilot the amount of success will determine future sales.

We have also received interest from World Learning, Save the Children, World Bank, Education
Development Center, and The Hesperian Foundation. At the present time we are sending them
more information about the project and waiting for a response back about their commitment
level. We have received interest from EDUCARE-Africa, who was very excited about the
product but felt that there was not a safe place for the projector to be stored and was unsure of
whether the product would survive the harsh whether. Even though the Kinkajou was built to be
durable, we believe we did not describe the product in great detail for it to be understood. Even
though EDUCARE declined, we hope to create a relationship with them in order to gain access
to other potential customers and hopefully EDUCARE’s business in the future, when the school
conditions have improved. For more information on the responses from potential customers,
please refer to the ―Contact Book.‖

A potential customer, UNESCO, launched the International Literacy Decade and Education for
all programs to make education a fundamental right for everyone worldwide, improve the quality
of education, and encourage education innovation. When contacting UNESCO we will show
that the Kinkajou will be an integral component to the success of these programs, thus gaining an
additional customer.

We believe that the Kinkajou will be accepted to the market by fall 2005. If successful, we will
take advantage of our partnership with USAID and World Education, to use word of mouth to
gain customers. We anticipate that by 2006 we will have captured .05% of the market.

Market Size and Trends

In September 2004, 75 units will be distributed by World Education into Africa. Based on the
feedback we receive on the performance and need for the Kinkajou, we will be able to produce
more projectors. In 2005, 2,000 units are projected to be sold. By assessing the potential size of
the end users, we determined that about 3,100,000 Kinkajous could be sold. But, this number is
not an accurate sales projection because not all illiterate adults are reached by NGOs. We
therefore determined that by 2006, we could take .05% of the market which would be about
15,000 projectors produced. These assumptions are based on estimated 2003 population and
projected population growths of illiterate adult Africans and divided by 60, or the average
classroom size in Africa.

The factor affecting our market growth is the percentage of illiterate adults that are being reached
by NGOs. Since it has been difficult to asses the amount of classrooms that are presently in
Africa, it is hard to predict the amount of Kinkajous that will be needed and not all end users are
being reached. But as we increase our knowledge of our customers and as our customers
continue to reach new communities, this number will be clearer.




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Competition and Competitive Edges

Currently, the major resources used in Africa to teach adult literacy classes at night are:
textbooks, chalkboards, flip charts, notebooks, oil lamps and flashlights. The Kinkajou will not
replace any of these resources, but will be considered a complimentary product, not competition.
After speaking with World Education, we were able to asses that educational resource costs will
decrease because they will not have to purchase as many oil lamps and flashlights, since
visibility will be sufficient for the whole class to see. However, they will still need enough
textbooks for students to take home and follow along during the class.

Occasionally televisions are used in the classrooms, but these communities are either in urban
areas or where electricity is readily available. For the Kinkajou it can be used through a car
battery, a usual source of power for rural communities, which can be hard to use for a television.
The can also use a hand generated battery charger, which can be used for a television. But the
main drawbacks of the televisions are that they are usually 15‖ or smaller, not big enough for the
average classroom size of 60 to see; they can be of low quality because they are donated and are
more susceptible to the harsh weather conditions, thus can break faster; a VCR needs to be
included; and VHS tapes can only hold so much information. Therefore, even if the technology
of a television would seem to be a motivator to learn, the Kinkajou is more durable, has more
visibility, and can hold more information. Therefore,
televisions are not really considered a competitor.

The textbooks that are used currently are either donated
from schools in urban areas or NGOs and educational
organizations work with the communities to write the
textbooks, and if funding is available, the texts are updated
them yearly. The advantage of using textbooks is the
ability for each student to have his own, so that he can bring
it home. However, the disadvantages are that many
classrooms do not have enough books for everyone, the texts can easily be damaged especially if
they are passed around from class to class or due to the harsh weather conditions, and there is
little interaction between the teacher and student because everyone is looking at their own books
and not one central area like a chalkboard. It is also expensive to print new textbooks every year,
if there is enough funding to reprint, if there is not enough funding, material that has not been
updated is used.

The chalkboards used are either smaller individual boards or large ones for the whole class. The
advantage to chalkboards is that it is a great resource to copy notes from the board and is
relatively inexpensive, but the disadvantages are it is difficult to use at night there is not enough
light source especially for the classroom sized board and only so much material can be put on a
chalk board until it needs to be erased so more information can be written. The advantages and
disadvantages have proven the same for flipcharts.

For light sources in the classroom, oil lamps and flashlights are used. The advantages of using
these resources are that they do allow for light for individuals in the classroom so nighttime
literacy classes can occur, but this allows for little interaction between the students and teacher as



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a group because it is difficult to see everyone from the little amount of light that is produced, and
they can be expensive because of having to continuously purchase batteries and oil.

The Kinkajou can help to prevent these problems because it will be a central area for the whole
classroom to be engaged in learning together. Also if mothers need to get up to walk their
children, as was a problem during the first field test, they can still pay attention without having to
carry a book around. Illustrated in the picture above, it is also
bright enough for a classroom of up to 60 students to see with
clear font and pictures, of course it cannot light up a whole
room, but it will illuminate enough so that oil lamps and
flashlights will only need to be used for groups of up to three
students instead of everyone, which can cut costs. The
projector was made to endure the harsh weather conditions in
Africa and was designed to run on low power requirements,
i.e. car batteries, a main source of power in rural communities.
It can also hold up to thousands of pages of text, so students will not be limited in their learning,
and the reels can be custom made at low cost. By working together, the present educational
materials and the Kinkajou will be able to educate more people together, more effectively and
efficiently.

Ongoing Market Evaluation

Presently and throughout the 2005 pilot program with USAID/Mali and World Education, we
will continue contacting potential Kinkajou customers to increase our understanding of our target
market and their needs, along with the market potential for out product. The pilot program will
allow us to have a deeper understanding of how the Kinkajou will work in the classrooms and
whether we will need to assess our strategy and product. It will also allow us to have insight on
the direct impact it has on the end users through their expressed interest and education
achievements with the product. Through contacting potential customers and the pilot program,
we will have greater knowledge of what the wants and needs are of our customers’ educational
needs, purchasing process and price sensitivity.

MARKETING AND SALES PLAN

Overall Marketing Strategy

In order to reach potential customers and have a successful business our focus is to use guerilla
marketing tactics. We will be aggressively targeting and contacting international and local
African NGOs and educational organizations that work in Africa for night time adult literacy. At
this present time we are in alliance with World Education, we have sent a proposal to
USAID/Mali to ask for their help in funding and assisting a pilot program we wish to start in
September 2004. World Learning has also expressed great interest in the projector and we are in
the midst of developing a relationship with them. We will continue to contact and reach other
potential purchasers as the business develops through direct calling, Boston newspapers, African
Education journals, and educational conferences. To generate sales, we will focus on the
educational, durability, and cost savings aspects of the production in order to attract customers.


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Presently, we are focusing on night time adult literacy classes in Africa, but as we build
relationships with customers we might discover that the projectors can be used elsewhere, such
as Asia, where interest has been expressed.

Pricing

Barbara Garner from World Education stated that her budgets and the African community
budgets would not have the funds to purchase a projector priced more than US $50. This figure
is also congruent to other organizations as budgets are not extensive.

Our goal is to have the projector cost between US$20 to US$30, which is an assumption,
depending on the fact that materials for the projector will continue to be donated. Presently, we
do wish to make a profit margin on the product, whether it is 5% or 40%, but our main objective
is to give the African communities the ability to purchase this product, so after speaking with
NGOs, the manufacturers, part donators, and at the end of the pilot test will we have a more
realistic idea on costs and price.

Since Fisher Price and other companies have donated the majority of the parts to the projector
and we are assembling it in-house and through our partnership with MIT, assembly and
manufacturing costs are few. In the future, we hope to have a product that local African
manufacturers will be able to produce and service this will build and enhance their capacity to
respond to opportunities in global marketplaces as well as with this particular product.

Even though the Kinkajou does not have a main competitor, it is a complementary product to the
educational resources used now, it will cut costs on flash lights and oil lamps because since the
light will be able to illuminate a portion of the classroom so lamps and flash lights will not be
needed there. Batteries and oil will not be used in as much abundance.

Sales Tactics

Presently the majority of the sales will be handled through Design That Matters and our
partnership with World Education by e-mailing and calling potential customers to introduce our
product to them. We will take advantage of World Education’s present relationships in order to
have easy access to customers. After developing relationships with other potential customers,
we also hope to take advantage of their relationships in order to increase our customer base.
Other sales tactics include featured articles in local Boston newspapers and African Education
journals in order to catch the attention of potential customers and investors. For the list of
newspapers and journals with their contacts please refer to the ―Contact Book.‖ We have
contacted local newspapers already and they are interested in writing an article about us free of
charge. Attending African educational conferences is also a sales tactic we wish to pursue.
Having the opportunity to attend and possibly have our product become a highlight at the
conference would give the Kinkajou a great edge in the educational resource market in Africa.
The advantage to newspapers and conferences are that we can gain a lot of coverage quickly and
free of charge.




                                                                                              14
Service and Warranty Policies

Even though the design and technology of the Kinkajou is relatively simple, we and a team of
resource people from the Ministry of Education will be training the educators of the night time
adult literacy classes on how to use the projector and what to do if it breaks. For the pilot
program, 75 projectors will be sent to African communities in September 2004, 4 months prior to
the beginning of the pilot, in order to train and teach communities about the Kinkajou. Although
four months seems like an extensive amount of time to train the educators, the majority of it will
be traveling time between the 45 communities we have to visit.

Training is important because it will allow for a greater understanding of the Kinkajou and its
technology by the end users. It will also give the end users the opportunity to take the initiative
when it breaks; they will understand the inter-workings of the projector and will have the
capability to fix it.

Advertising and Promotion

The approaches we will use to bring the Kinkajou to the attention of prospective purchasers are
through direct e-mail and calling potential purchasers, local Boston newspapers, African
Education journals, and African educational conferences.

To date, e-mailing and calling has been relatively unsuccessful. We feel this is attributed to the
fact that access to the specific contact information of the Directors of Education, the potential
direct purchasers of the product, is difficult to attain. Therefore, we have been able to take
advantage of Barbara Garner’s specific contacts with other organizations and have been to bring
attention and interest to our product. We hope from new customers we will be able to take
advantage of their contacts also. In the mean time, we will continue to research and contact
potential customers. For more information on who are our potential customers are and our
contact status with them, please refer to the Contact Book. After creating interest through our
initial e-mail (EXHIBIT C) and phone call to a potential customer, we respond by sending the
Kinkajou Progress Report (EXHIBIT D), for more information on the project, and a Market
Opportunity Questionnaire (EXHIBIT E), in order for us to gain more knowledge on the
customer and their background and current adult education work. Following the e-mails and
calls, we hope to advance the relationship through meetings and contracts.

We have had success with local Boston newspapers interested in printing an article (EXHIBIT F)
about the Kinkajou. We decided on Boston and the surrounding area because of the local
attention we can receive and the easy access local organizations and foundations would have to
us and vice versa. Our hopes that the project will catch the eye of a potential customer or
investor who wants to help us advance the project. Calling the newspapers and finding the
appropriate director for non-profit publications, proved successful. After describing the project,
our contact was going to look over our website and read over the description to see if the article
would be worth publishing. Until we are published in a newspaper, our efforts to secure an
article will continue throughout the business. For a list of newspapers please refer to the
―Contact Book.‖




                                                                                                15
If we can have an article (EXHIBIT F) written about the Kinkajou, free of charge, in African
Educational Journals, whether they are produced by a University in Africa, or produced by an
NGO, it will be a valuable tool to reach potential customers. As the same with newspapers, until
we are published in a journal our efforts to advertise will carry on throughout the business. For a
list of journals please refer to the ―Contact Book.‖

The offer to highlight our product at a conference would be a huge boost to our promotion
campaign and success of the product. Our strategy is to contact the organizer of the conference,
describe our product, and hopefully they will be interested in bringing it to the conference.
Throughout the business we will continue to contact conferences worldwide in order to promote
our product. For a list of potential conferences, please refer to the ―Contact Book.‖

Costs incurred through promotion and advertising will be through internet usage, phone calls,
and traveling.

Distribution

Distribution of the Kinkajou will go straight from in house assembly to the NGO customer. The
batch of 75 projectors will be assembled in house and will be sent straight to World Education,
shipping costs are the customers concern, where they will disperse them to the communities.
After the product has been sent to the NGO, we do not have responsibility of where it is
delivered. During the pilot program we hope that a local African manufacturer will want to
produce the product, so distribution can go from the manufacturer to the local African NGOs to
the communities after the pilot program. Pricing and margin strategies between the local
manufacturer and us will be determined once we develop relationships.

MANUFACTURING AND OPERATIONS PLAN

In September 2004, 75 field test units will be distributed in Africa by World Education. There
will be a 4 month long training session for local teachers on how to use the projector and also
how to care for it. Classes will begin in January 2005, using the Kinkajou. The cost is estimated
to be about US$625 per unit. This is based on the assumption that the projector costs will be
around US$200 while the labor and assembly will be about US$425. The cost estimates for these
units are high because of the low volume and ―prototype‖ nature of the product. The units will be
hand assembled by a head design engineer. In 2005, 2000 units will also be assembled by the
head design engineer. These units will incorporate any findings that occurred based on the field
                                test in Africa.


                               During the 75 unit field test, we plan on addressing one of our
                               goals: the ability to manufacture and service the Kinkajou locally
                               in African communities. During this test in Mali, we would like to
                               survey local Malian manufacturers regarding their interest in and
                               capacity to manufacture component parts, assemble, distribute,
                               and support the Kinkajou. This information will help us to
                               identify a set of partners who can help us with the manufacturing


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and support of the Kinkajou. A local Malian entrepreneur, Mr. Samassekou, is interested in this
project and we will continue to advance our relationship. We will need to determine the
manufacturing training and equipment needs in the communities, as well as the service and
support needs. Business plans will also be developed in partnership with these businesses, in
order to enhance their capacity to respond to opportunities in global marketplaces involving the
Kinkajou. Eventually, our goal is to have manufacturing sites across Africa.

There are many advantages of having the manufacturing of the Kinkajou done in Africa and not
in the United States. First, the projector will not have to be sent overseas, therefore there will be
less risks of the projector being lost, stolen, broken during travel, etc. Also, if the manufacturing
is done in Africa, it will be easier to distribute out to communities who are in need of this
projector. Another reason this is a main priority of ours is what to do in the event a projector
breaks down. If manufactured in Africa, local manufacturers would be able to service the
projectors if they broke down or if parts broke. That way, parts and projectors would not have to
be sent overseas and education from the Kinkajou could resume immediately, instead of waiting
for the projector to be shipped. After the 75 unit field test in Africa, we will have plenty of
information on our ability to manufacture the Kinkajou in Africa.

TEAM DESCRIPTION

Timothy Prestero

                  Timothy Prestero (EXHIBIT G) is a Principal and cofounder of Design that
                  Matters. For the Kinkajou project, Timothy is in charge of business
                  development and technical sales. He is a graduate of the MIT/WHOI Joint
                  Program in Applied Ocean Physics and Engineering. Timothy holds M.S.
                  degrees in Mechanical and Oceanographic Engineering, and a B.S. degree in
                  Mechanical Engineering from the University of California at Davis.

                 Timothy has a wealth of knowledge of foreign countries as he has traveled
throughout West Africa, Latin America and Asia. However, more importantly Timothy was a
Peace Corps volunteer in Côte d'Ivoire, West Africa in the Urban Environmental Management
program. Here, he worked as a consulting engineer and project manager for a city public works
department where he completed several urban infrastructure projects, and organized conservation
projects and science clubs at local secondary schools. His education in engineering and his
knowledge of Africa is vital to the success of the Kinkajou.

Neil Cantor

                  Neil Cantor (EXHIBIT H) is also a Principal and cofounder of Design that
                  Matters. He is also responsible for business development. Neil received his
                  undergraduate degree from Cornell University in political science. He also
                  received his MBA in Finance and New Product Development from the MIT
                  Sloan School of Management. Neil, along with Timothy is also in charge of
                  business development of the Kinkajou. Before he attended the MIT Sloan
                  School of Management, he worked at two startups, managing media outreach


                                                                                                  17
and doing business development. Neil’s extensive business background is extremely valuable to
the success of Design that Matter’s and the success of the Kinkajou.

Peter Fichter

Peter Fichter (EXHIBIT I) is the product manager programmer for the Kinkajou. His educational
background and past job experiences make him a leader in program management and new
product development. One of Peter’s main responsibilities surrounding the Kinkajou is
operations and making sure everything is on schedule and running smoothly. He makes sure the
Kinkajou is conceptualized and produced and sent out. Peter determines the appropriate amount
resources and time that is necessary to achieve the success of the Kinkajou. Peter works for
Design that Matters on contract.

Allen Armstrong

Allen Armstrong is the lead design engineer of the Kinkajou. For the 75 field test units that will
be shipped to Africa in September 2004, Allen is responsible for producing these units himself.
He makes sure to take into account the feedback that Design that Matters receives about the
Kinkajou, and fix the projector according. Allen is a crucial part of the design of the Kinkajou.


FINANCIAL PLAN

Cost Assumptions

As stated previously, in September 2004, 75 field test units will be distributed in Africa by
World Education. The cost is estimated to be about US$625 per unit. This is based on the
assumption that the projector costs will be around US$200 while the labor and assembly will be
about US$425. The cost estimates for these units are high because of the low volume and
―prototype‖ nature of the product. The units will be hand assembled by a head design engineer.

We are confident that the cost of the Kinkajou can be about US$50 per projector. There are a
number of costly components to the projector including the design, optics, and the LED lighting.
We are currently working with Fisher Price who has donated optic lenses for the projector, free
of charge. This is a wonderful opportunity for us as we are saving a significant amount of costs,
but also a great opportunity for a positive effect on Fisher Price’s public relations. We are also
talking to a company who we believe will donate the LED lighting for free, which will also be a
huge benefit for us. However, the US$50 cost is for the projector only. A power source, most
likely a 12 volt battery will be needed to run the projector along with a battery charger, and will
not be included in the US$50 cost. In 2005, the 2000 units that will be produced, we are
assuming will cost US$50 each.

We believe that our costs over the next few years will be due to intense market research. The
costs will be for travel, phone, and the internet. The travel costs will be used when there are
conventions that we should travel to in order to market the Kinkajou. The phone bill will also be
a primary method for our market research, which will result in large bills. Also, the internet will


                                                                                                18
also be another cost for us as we will have much of our research on potential customers through
visiting sites on the Web.

Market Assumptions

EXHIBIT B, indicates the number adults, ages 15 and up, who are illiterate in each country in
Africa. We then divided this number by 60 or the average classroom size. This number
determined the number of classrooms, or the potential number of Kinkajous (one per classroom)
that could be sold per country. Overall the total potential number of Kinkajous that can be used
in Africa is roughly 3.1 million. This is a huge market potential for us. Therefore, in determining
the amount of Kinkajous that could be sold in 2006, we decided to take .05% of this number
which is roughly 15000. In 2006, after the feedback from the 75 field test units are distributed
and also the 2000 units in 2005, we believe we could increase our sales of the Kinkajou
dramatically when the feedback comes back and it is positive. Therefore, a .05% of this huge
market would be a realistic goal by 2006.

World Education and the USAID Proposal

Our main partner, World Education will compensate us for the cost of the projectors. World
Education is able to fund the money through a variety of sources. They are able to revisit
previous donors and explain the benefits of the Kinkajou, in order to receive donations. World
Education has already received about US$10,000 as a result of revisiting previous donors. Our
partner has also submitted a proposal to USAID, another NGO, that if accepted, USAID would
cover the cost of the projector and other added costs of the field test. World Education is
requesting $490,474 from USAID over two years. The value of non-federal resources (cost
share) provided by Alliance partners equals 208,408, which includes a cash match of at least
US$41,000.

In addition, this program leverages resources that are expected to exceed a two-to-one ratio. By
the summer of 2004, Design that Matters will have contributed resources valued at US$269,689
toward the development of the Kinkajou projector. These resources include staff time,
engineering, business development, field tests in 2003, and production of the prototype. World
Education and partner non-governmental organizations will have directed resources valued at
US$10,000 toward the development of the Kinkajou projector. These resources include staff time
devoted to providing customer feedback to engineers working on the Kinkajou. Over the next
two years, we expect private sector producers in Mali to contribute time and resources to
exploring possibilities for local manufacture of the Kinkajou, estimated at US$90,000. The
engineering school in Bamako has expressed interest in participating in the field research, and
time that teachers and students contribute is valued at US$11,000. Community investment in
literacy centers is valued at US$540,000, representing a significant contribution from civil
society. University engineering teams and business teams recruited through Design that Matters
are expected to contribute resources valued at US$69,800 over the next two years for technical
design inputs and market research. World Education’s own contribution to the global market
survey is valued at US$16,000. Overall, the total amount of leveraged contributions from all
these sources is expected to exceed US$995,000.




                                                                                                19
Financial Conclusions

In conclusion, the market opportunity for the Kinkajou is enormous with about 3.1 million
projectors that could be sold. After the 75 unit field test in Africa in September, we will be able
to know much more about the strengths and weaknesses of the projector. From here we will be
able to make updates to the design of the projector so that it will be perfect for education in
African classrooms. After this we will be well on our way to selling this revolutionary teaching
tool to NGOs at an affordable price of US$50 each.

We believe that at some point in the near future we will be able to cut the cost of the projector to
US$30 each. Customers have stated that they will not pay anymore than US$50 per projector,
resulting in a US$20 profit per projector. Also, we see this business as potentially being an
annuity business. These projectors are durable and designed to withstand the climates in Africa,
therefore, people will not be replacing a projector each year. However, we see the opportunity of
charging a fixed amount of money each year where a technical expert could come in and perform
a routine maintenance check up.

The proposal for USAID/Mali, if accepted will greatly help us in selling and administering the
Kinkajou to NGOs. Overall there is a huge market opportunity for the Kinkajou and with the
correct design and funding opportunities the projector can revolutionize education in
underdeveloped countries.

*** Neil Cantor was unable to send us present financial information, therefore we deemed it
unnecessary to put in financial statements as he knows all the costs that they incur where our
assumptions would be inaccurate. Also, because Design that Matters will only be selling 75
units this year and 2000 and not making a profit, the financial statements were useless for
Neil. The future sales projections in this section though will help Design that Matters in future
years.

RISK AND CONTINGENCIES

The major risks to the Kinkajou project include customer risks, product risks and the risks of
unforeseen events. Risks associated with the customers are whether our target market will have
the funds to pay for the Kinkajou, although we have information that World Learning can only
pay up to US$50, there is always the uncertainty of receiving grants and funding. But as we
learn more about our customers, we will be able to allow for enough time to send budget
proposals to foundations, so that we can bypass this potential risk. Also, there is the risk that the
predicted US$50 will not be reached and therefore customer budgets will not be able to pay for
the projector. We will need to continue our the development of the product and our research of
local manufactures in order to decrease shipping costs.

There are also many technological challenges that they face as well. The communities need to
be able to find their own power source. Even though the car battery can be used, there is the
possibility that all communities do not have them or enough for all classrooms. Batteries can be
used with a pedal generator, but that could possibly be another cost for the end users to incur.




                                                                                                  20
We will be able to avoid this risk, by making sure the cost of our projector is low enough so that
a power source can also be purchased, under the US$50 mark.

There are also unforeseen events such as theft of the product and misuse that could be a major
issue when the team and World Education deliver the product this fall. Design That Matters
needs to develop an adequate training session about the product for the end users so that they
manage the maintenance and technology of the product. Presently, we are in the midst of
designing a training program for the pilot program so that end users can take understand the
product and its workings.

Another risk is that we do not have a patent for the Kinkajou. If the Kinkajou is a major success,
will there be competitive foundations or organizations that will supply a similar or improved
substitute to the communities? In order to avoid this risk, we will need to develop strong,
trusting relationships with our clients in order to evade copying.

Another issue to be concerned about is whether or not the Kinkajou will meet the real need of the
illiterate adults so that it will affect the lives of thousands or even millions of people. During the
2005 pilot program, we will need to focus on our objectives and listen to our customer’s needs
and wants in order to change the necessary pieces of the Kinkajou so that it is a success and a
useful tool.

EXIT STRATEGY

If feedback from the field tests in Africa come back negative, and we feel that there is no future
for the Kinkajou, we can simply end the production of this product. We want to make sure that
the projector has staying power and that students will be interested in the Kinkajou after a set
amount of time. The field tests need to prove that the projector is not just a fun, exciting, new
technology but a lasting, beneficial educational resource. Once these results come back, we will
be able to evaluate the opportunity for the Kinkajou.

If replication competition arose, and we were unable to hold our share of the market, we would
have to decide whether we should continue the business or possibly propose to our competitor
that they buy us out.




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