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Agora2/8/2011

Sell-side: Cloud infrastructure service providers Enterprises with spare capacities in their private clouds; privacy concern will not prevent enterprises from selling their resources Consumers or small businesses who want to sell off their resources during sleep cycles (screen saver style)Buy-side: Startups (most are using AWS today) Companies engaged in image and video processing, conversion and rendering (e.g. digital media companies) Scientific data processing (e.g. biotech research companies) Financial modeling and analysis (e.g. hedge funds) Enterprises migrating from own data center to cloud infrastructure Oversold infrastructure providers Arbitrageurs Direct sales force on both sell and buy sides to seed the market. Application vendors that are interested in reducing the infrastructure cost of their customers Integrators (e.g. Accenture) Automated sign-up process Key influencers within the startup movement, such as Quora, Foursquare IT thought leaders or technology evangelist to foster market adoption

Customer acquisition costs need to determine how heavily will we need to rely on our direct sales force (vs using online marketing to drive buyers to market) Development Costs Infrastructure costs will scale with # transactions (a function of # customers and frequency of transactions per customer per day) Support costs will scale with # transactions Legal costs filing patents, incorporations, etc Transaction fees / commissions charged to sellers Derivative products

Automated sign-up and transaction process API support for buyers developers / IT admin staff Live customer support to handle sign-up and transaction issues / glitches Developer support for API Online support forumSell-side: Service providers: Additional marginal revenue at negligible cost (mostly additional customer service cost) Enterprises: Lower IT cost spot market revenue mitigates portion of infrastructure costBuy-side Reduced cloud compute infrastructure cost Increased procurement flexibility Develop a functional platform / marketplace Sign-up sell-side and buy-side customers Process payments Technology partners companies that provide cloud infrastructure interoperability and portability products/services Payment processor Law Firm PR / Marketing Firm VC/Investor Physical servers vs cloud? Brand largest market for cloud compute resources Intellectual property efficient buy-sell matching and transaction execution Development resources UX and scalable distributed backend Enterprise sales force (small and tight, focused on key accounts) Biz dev (channel partners and technology partners) Support (initially handled by dev) Financial angels and VCs. Amount TBD.Agora V1

Buy-side (most important):High compute needs with high variability in usage Primarily large enterprise Companies engaged in image and video processing, conversion and rendering (e.g. digital media companies) Scientific data processing (e.g. biotech research companies) Financial modeling and analysis (e.g. hedge funds)

Sell-side (secondary- will follow if we are able to attract buyers): Cloud infrastructure service providers

Direct field sales force to enterprise customers Integrators / consultants (e.g. Accenture)

Customer acquisition costs Demand creation + Field sales Development Costs Infrastructure costs will scale with # transactions (a function of # customers and frequency of transactions per customer per day) Support costs will scale with # transactions Legal costs filing patents, incorporations, etc Subscription charge to buyers% fee to sellers from channel activitiesDerivative products

For enterprise segment, higher touch model with direct sales force API support for buyers developers / IT admin staff Live 24/7 customer support Online support forumBuy-side Reduced cloud compute infrastructure cost through capacity planning Better, easier way of finding the right compute to match their needs

Sell-side: Channel with low acquisition cost Better planning for demand variability

Develop a working prediction algorithm & build productDevelop matching algorithm for compute & build portalSign up keystone customers to test productDevelop relationships with cloud compute vendors

Technology partners cloud vendors, management tools Payment processor Law Firm PR / Marketing Firm VC/Investor Physical servers vs cloud? Brand efficiency in the cloud Intellectual property prediction algorithm Development resources UX and scalable distributed backend Enterprise sales force Biz dev (channel partners and technology partners) Support Financial angels and VCs. Amount TBD.Agora V4Capacity Planning AnalogiesCall CentersRetail SalesManufacturingAgora2/8/2011

AWS User Group meeting in SFChannel: Lessons LearnedDirect inside sales repsCloud consultantsWeb

Entry Level CustomerEstimated LTV$1,000 / mo5% attrition rate month-to-month20 month average lifetime$20,000 LTV

Inside Sales ModelAnnual Sales Cost: $840KLead gen: $40K3 Inside sales reps: $600K2 Tradeshows: $200KAnnual Bookings: $4.8MAnnual New Revenues: $2.9M

8 calls per rep per day240 days per year5% conversion from qualified lead to customer

8Enterprise Level CustomerEstimated LTV$20,000 / mo2% attrition rate month-to-month50 month average lifetime$1M LTV

Field Sales Model3 Field Sales Reps: $1.5MAnnual Bookings: $12MAnnual New Revenues: $3M

4 new enterprise customers per rep

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