Sample Feasibility Summary: Eislee

19th Annual Edward L. Kaplan, ’71, New Venture Challenge and 5th Annual John Edwardson, ’72, Social
New Venture Challenge
2015 FEASIBILITY SUMMARY COVER SHEET
Eislee
Please consider our application for (Check all that apply):
_X_ Traditional New Venture Challenge
_X_ Social New Venture Challenge
Team Members (Please list main contact for your team first):
Name
Email Address
Kate O’Connor [email protected]
Sara Raffa
[email protected]
Booth Class Year or E/W Affiliation (if non-Booth)
2016
2016
N/A
N/A
Please list all the participants who contributed significantly to the Business Idea. Attach additional sheets if necessary.
Business Description (50 words or less, please note that this info may be made available on the NVC
website):
Eislee will sell scarves made from alpaca yarn, sourced from impoverished villages in Peru. Alpaca is soft like cashmere, but
more durable, less expensive, and eco-friendly. The scarves will be classic and stylish, and produced in an ethical fashion from
beginning to end.
Problem This Business is Addressing:
Eislee will introduce alpaca to a broader and more stylish market. Our product fills a gap in the market between wool and
cashmere, offering a high-quality, attractive scarf at a reasonable price point. Our brand is also in line with the “slow fashion”
movement, promoting mindfulness in both production methods and consumption.
Social Impact of Business: (Social NVC applicants only)
We plan to source the alpaca wool from a Peruvian cooperative (instead of from one of two large corporations that currently
dominate the Peruvian alpaca market). The cooperative ensures higher wages for the farmers and helps them to improve their
herding practices. We will also donate a portion of revenue to support education in the communities in Peru from which we
source. Additionally, we will ensure a transparent production process by only using factories that adhere to ethical working
conditions.
Initial Target Customer Segment:
Our initial target segment is the “sensibly stylish.” These consumers are young, interested in fashion and style, but also sensible
to price and quality. They are also concerned with social issues.
Potential Market Size: (if available)
US market size for accessories, annually: $30.5 billion
Market size for scarves: $440 million, 40 million scarves
Scarves purchased online: $44 million
Competing or substitutable products: (if available)
Our competition comes from three avenues: (1) young, stylish brands who sell alpaca scarves, (2) retailers who sell scarves in
other materials, and (3) companies with similar brand missions – both style and sustainability/social impact.
Why is this the right team to launch this business?
Our backgrounds in consulting give us the ability to understand business landscapes, develop relationships, solve problems and
manage complex projects. We have experience and connections in retail, fashion, startups, non-profits, web design and digital
marketing, as well as several Peruvian contacts involved in impact investing and the textile industry. Lastly we are both very
passionate about the project. We believe in our product and believe in the importance of benefitting others through business and
social impact. We have visited Peru, including communities in the Andean highlands that raise alpaca, to explore our business
concept. We have also dedicated significant time to learning about the cultural landscape and alpaca industry in Peru, as well as
the fashion industry here in the US.
Key milestones or estimated time to market: (if available)
Phase 1 (Oct 2014 – Jan 2015): Through extensive research, gained a better understanding of sourcing, manufacturing and the
competitive market for alpaca scarves. Talked to potential customers, cooperatives and manufacturers.
Phase 2 (Feb – May 2015): Develop our presence on social media. Visit Peru to meet with and select cooperatives and
manufacturers. Design our first style of scarves.
Phase 3 (June – Aug 2015): Launch our Kickstarter campaign. Begin production of our first run of scarves.
Phase 4 (Sept 2015 – Feb 2016): Launch our website and begin sales online. Market through partnerships, social media and
press, as well as sales at craft markets, trade shows and pop-up shops.
Phase 5 (Mar 2016+): Diversify our product line to include various alpaca apparel and accessories, as well as other sustainable
products.
CERTIFICATIONS AND AGREEMENTS
19th Annual Edward L. Kaplan, ’71, New Venture Challenge and 5th Annual John Edwardson, ’72,
Social New Venture Challenge
The University of Chicago Booth School of Business
Polsky Center for Entrepreneurship and Innovation and Social Enterprise Initiative
5807 South Woodlawn Avenue, Chicago, IL 60637
By submitting a Business Idea (“the Idea”) to the University of Chicago Booth School of Business - New Venture Challenge or Social
New Venture Challenge (“the Competition”), each Contestant listed below agrees to the following conditions:
Originality of Plan. The ideas and concepts set forth in the Idea are the original work of the Contestants and that the Contestant is not
under any agreement or restrictions which prohibit or restrict his or her ability to disclose or submit such ideas or concepts to the
Competition.
Compliance with Guidelines of the Competition. Each Contestant has reviewed the Entry Guidelines ("the Competition Guidelines")
and by his or her signature below certifies that this entry and the team or individual it represents complies with the Guidelines and
agrees to abide by the Guidelines.
Recognition of Prize Money (New Venture Challenge only). As a condition to receive the Prize Money, each winning team must agree
to provide Chicago Booth with equity in the Company (that was the subject of its business plan) in an amount equal to its respective
award if the company receives funding or otherwise enters into a business combination transaction wherein the surviving entity
receives financing or equity in another entity, within three years of the agreement date.
Waivers and Releases. Each Contestant understands that the University of Chicago Booth School of Business, each of the co-sponsors,
judges, mentors, co-organizers (the “Competition Officials”) and its directors, officers, partners, employees, consultants and agents
(collectively “Organizer Representatives”) are volunteers and are under no obligation to render any advice or service to any
Contestant. The views expressed by the judges, co-sponsors, co-organizers, and the Organizer Representatives are their own and not
those of the University of Chicago Booth School of Business or any person or entity.
Each Contestant also understands and agrees that although the Competition Officials have taken and will take the steps described in the Guidelines regarding confidentiality of the ideas and plans submitted by the Contestants, the legal protection of the ideas and plans submitted by the Contestants to the Competition is otherwise the sole responsibility of the Contestant. In consideration of the time, expertise and other resources provided by the Competition Officials and Organizer Representatives to the Competition, each Contestant hereby voluntarily releases each Competition Official and each Organizing Team Member from any further liabilities, responsibilities, and accountabilities relating to or arising out of such Competition Officials or Organizer Representative's participation in the Competition. Business Plan Name: Eislee
Contestants (Team Members): List principal contestant (point-of-contact) first
Name(s):
Signature(s) (Check Box to sign electronically):
Date(s):
Kate O’Connor
Sara Raffa
X
X
2/8/2015
2/8/2015
KATE O’CONNOR
222 N. Columbus Dr., Unit #1011 | Chicago, IL 60601
(248) 535-3554 | [email protected]
EDUCATION
THE UNIVERSITY OF CHICAGO BOOTH SCHOOL OF BUSINESS
Master of Business Administration
• Concentrations in Entrepreneurship, Strategic Management, and Managerial and Organizational Behavior
• Active member of the Entrepreneur and Venture Capital Group, Chicago Booth Golf Club and Net Impact
• GMAT: 730 / 96th percentile
THE UNIVERSITY OF MICHIGAN
Bachelor of Arts in Economics, Minor in Italian
• Study abroad in Florence, Italy
Chicago, IL
Sep 2014 – Jun 2016
Ann Arbor, MI
Aug 2005 – May 2009
EXPERIENCE
ERNST & YOUNG
New York, NY
Senior Consultant
Oct 2012 – Jun 2014
• Determined strategic direction for various health companies by collaborating with client sponsors to develop customer outreach
methods that effectively engaged customers in managing their own health.
• Conducted system and business requirements analysis to facilitate coordination between business and IT activities.
• Presented regularly to senior executives, detailing project strategic direction and progress towards enterprise goals. Led
workshops with company employees to direct actions for specific departments and provide recommendations for meeting project
milestones.
• Designed a new process with analytics and marketing teams to launch a “Digital Fulfillment” (email) campaign for outreach to
customers of a major health plan.
• Developed over 80 unique fulfillment materials, which were sent monthly to thousands of health plan customers by coordinating a
weekly workgroup with representatives from across client departments.
Staff Consultant
Oct 2010 – Sep 2012
• Led onboarding and training of new project team members by determining appropriate training content, planning timeline and
scope of training sessions, and creating engaging materials. Executed training sessions for over 40 EY and client professionals.
• Conducted interviews for clients to determine how Healthcare Reform (HCR) requirements would impact business processes.
Presented recommendations to client executives and created implementation plans based on feedback.
• Coordinated implementation of HCR benefits for over 250 private companies at a major health plan client. Facilitated weekly
meetings between multiple business areas to ensure accuracy of HCR execution.
William Beaumont Hospital
Royal Oak, MI
Web Marketing & Pediatric Services Intern
May 2010 – Sep 2010
• Developed Nutrition Services web page based on feedback from Nutrition department. Modified hospital website to increase
visitor ‘Call to Action’ opportunities.
• Contributed to special projects for Vice President of Pediatric Service line, including conducting research into new monitoring
system for Newborn Intensive Care Unit.
O’Connor, DeGrazia, Tamm & O’Connor, P.C.
Bloomfield Hills, MI
Clerk & Legal Assistant
Jan 2010 – Apr 2010
• Created a system to index thousands of expert witness testimonies in a digital database, formerly only available in paper copies.
• Assisted attorneys and legal assistants with research through a variety of tools (e.g. LexisNexis)
ADDITIONAL
•
•
•
•
Lived in Ireland for four months, where I took a Lectureship series at Trinity College, tutored undergraduate students and traveled
extensively throughout Europe.
Have gone shark diving with great white sharks in South Africa and skydiving over the Swiss Alps.
Avid golfer and have been playing since I was 8 years old.
Love to read. My favorite book is Franny & Zooey, which I have read about seven times.
SARA DANIELE RAFFA, CPA
73 East Lake Street, #3610 | Chicago, IL 60601
(301) 908-6766 | [email protected]
EDUCATION
THE UNIVERSITY OF CHICAGO BOOTH SCHOOL OF BUSINESS
Chicago, IL
Master of Business Administration
September 2014 – June 2016
• Recipient of the 1898 Merit Scholarship for leadership and academic achievements; GMAT: 750 / 98th percentile
• Concentrations in Entrepreneurship, Strategic Management, and Managerial and Organizational Behavior.
• Active member of the Entrepreneur and Venture Capital Group, Booth Ski and Snowboard Club and Giving Something Back.
GEORGETOWN UNIVERSITY MCDONOUGH SCHOOL OF BUSINESS
Washington, DC
Bachelor of Science in Accounting and Marketing
August 2007 – May 2010
• Class rank: 12/355; GPA: 3.86/4.00; Magna cum laude
• Awarded the George Houston Accounting Achievement Award and Marketing Faculty Award for Academic Excellence, both
reserved for the top student in the respective major based on GPA and nominations by professors.
• Selected as member of Beta Gamma Sigma, Alpha Mu Alpha and the National Society of Collegiate Scholars based on GPA.
• Played Club Lacrosse, served as the Vice President of Marketing for Alpha Kappa Psi (Georgetown’s professional business
fraternity) and participated in the National Student Advertising Competition and Accenture Case Competition.
EXPERIENCE
PRICEWATERHOUSECOOPERS LLP
McLean, VA
Risk Assurance Senior Associate
July 2013 – July 2014
• Led various internal control consulting projects for teams ranging from two to eight associates at a Fortune 500 lodging real estate
investment trust (REIT).
• Managed teams in testing over one hundred financial reporting and operational controls at two public REIT’s, collaborating with the
client and external auditors to communicate scope of testing and identify gaps and findings.
• Planned for hotel audits by analyzing prior year results and industry changes, redefining the annual test plan, setting benchmarks and
creating the databases to be used on all audits across the team.
• Led 12 luxury hotel audits throughout the country, supervising two staff and working directly with the property controller to
complete testing, present findings and recommend improvements on over two dozen operational processes per audit.
• Developed a hospitality training manual and two-day presentation for over 30 co-workers and client team members.
Risk Assurance Associate
September 2010 – June 2013
• Directed the documentation and improvement of 40+ internal control processes at a Fortune 200 government contractor and a
private REIT. Created 12 best in class processes and prepared a related training program for all managers worldwide.
• Managed requests from and served as a go-to leader for the Global Delivery team in India and Argentina. Proposed new methods of how
to overcome language barriers and limited experience of the global team.
• Received the highest ranking possible due to achieving above expectation results on challenging projects for top clients as noted
by supervisors and peers.
• Founded and led the PwC Risk Assurance Community Service Committee, planning at least one event each quarter and
identifying strategies to grow participation with increased success. For example, raised $4,400 through thanksgiving pie sales to
go towards meals for sick individuals in the community and cleaned up a local park with over 30 co-workers.
Risk Assurance Summer Intern
June 2009 – August 2009
• Conducted financial and operational controls testing for a Fortune 50 financial services firm and a publicly traded satellite
communications firm.
• Received a full-time offer at the end of the summer based on strong performance on all projects.
ADDITIONAL
•
•
•
Collaborated with the entrepreneurs of Zombie Coffee – a youthful, edgy coffee concept – prior to the opening of stores.
Brainstormed marketing and social media, worked through financials, discussed how to improve farming sustainability at a
cooperative in El Salvador and developed a business plan, which was shared with potential landlords and investors.
Avid concertgoer and choral arts supporter. Served on the Children’s Chorus of Washington’s Board of Directors within the
finance committee and chaired the Young Patrons for the Choral Arts’ premier outreach holiday event, increasing ticket sales by
approximately 20% each year.
Traveled to over 20 countries. Bungee jumped at Victoria Falls, rode camels in the Negev Desert, climbed a mountain
overlooking Machu Picchu and played competitive field hockey in the Netherlands.
Company Overview
Eislee is a for-profit social enterprise, selling scarves made from alpaca yarn imported from Peru. Our company will offer a
beautiful, lasting product at an attainable price, introducing alpaca to a broader, more stylish market. We also support the sustainable
and ethical fashion movement, benefiting the communities from which we source our materials and upholding strict standards at each
stage of the production process.
Background
3.5 million alpaca live in Peru – 80% of the world’s population – and 50,000 families in the Andean highlands make a living
from herding alpaca. These families live in remote villages, with limited access to resources. As a result, many are living in poverty.
Our goal is to source alpaca yarn through nonprofits or cooperatives that directly support these communities, produce scarves in
factories in Peru, and import the finished scarves to the US to be sold through our ecommerce platform. We believe this fills a gap in
the marketplace for high-quality scarves in a fabric between cheap cotton or itchy wool and expensive cashmere.
Alpaca fiber is a remarkable material, yet its benefits are not widely known. The finest variety, baby alpaca, is as soft and
attractive as cashmere, but lighter, more durable and significantly less expensive. Alpaca fiber is processed in villages in Peru using
the same traditional methods and farming practices that have been used for thousands of years. Cashmere, by contrast, is produced in
mass in China and Mongolia, where increased demand for the material has altered farming practices, leading to degraded fiber quality
and depletion of the natural environment. Consumers tend to associate cashmere with luxury and quality, but it is not uncommon
today for a $100+ cashmere scarf to pill after a few months of wear. Alpaca fibers are longer, and thus less likely to show wear. The
material is also hypoallergenic (unlike wool), naturally water-repellent, moisture wicking and odor-resistant (think socks).
Large retailers like J. Crew and Nordstrom have started offering products made from alpaca fiber, and several designers
featured alpaca products during NYC Fashion Week 2014. However, while companies are beginning to take notice of alpaca yarn, it is
still not widely promoted in the US. This presents an opportunity in the scarf market for Eislee to provide a lasting yet affordable
product for the Sensibly Stylish, a growing consumer segment.
Social Impact
The Peruvian alpaca market is dominated by two major producers who have no clear social mission. The two largest sellers
of alpaca products, Michell and Incatops, hold 90% of the total market and 97% of the export market in Peru for alpaca products. The
remaining market consists of small nonprofits and cooperatives. While Michell and Incatops have associated nonprofits, their true
impact is unclear. Their buying power in the market allows them to pay lower wages to the farmers while still making huge margins.
We have identified and begun discussions with a cooperative, COOPECAN, which is the third largest exporter of alpaca yarn
and products, holding 2% of the export market. COOPECAN provides financing to the villages, pays the families in advance of
purchase, classifies the yarn according to quality levels, and processes the fiber into yarn. COOPECAN gives 70% of all profits back
to the families and maintains 30% to improve their services. They offer cash advances for the farmers and implement projects to
improve the quality of alpaca fiber through: (1) management of natural resources, (2) genetic improvement, (3) cost lowering services
(such as animal health services and machinery purchases), and (4) transportation services from the small villages to the processing
centers. Despite their small share of the alpaca market, COOPECAN has been rapidly growing, with 261% growth throughout 2012.
Additionally, they secured funding in 2014 to acquire a factory for processing the fiber into yarn, which demonstrates their plans to
continue growing in the coming years. Working with COOPECAN or one of dozens of other similar cooperatives, Eislee has the
opportunity to disrupt the alpaca market in Peru by giving greater power and influence to socially conscious organizations focused on
true social impact.
In addition to sustainable sourcing, our end-to-end production process is a significant element of our brand story. We
therefore plan to produce only in factories that support ethical working standards and to visit these factories often to verify these
conditions.
Target Customers
Our company has two key components: we offer a quality, stylish product at an accessible price and we support sustainable
fashion practices. Companies that focus on the first element target “Fashionistas,” or devoted followers of fashion. Companies that
focus on the second element target “Passionistas,” or those who want to experience the world and make it a better place. According to
discussions with David Dietz,
CEO at Modavanti, these two
segments are converging, and
that is where our ideal customer
lies. Our early adopters are the
“Sensibly Stylish,” consumers
who are fashion conscious, but
also sensible to cost and
production methods. Customer Research
Just as certain consumers are shifting away from fast food in favor of higher quality and sustainably sourced fresh food, so
too we expect socially conscious consumers to prefer sustainably and equitably sourced apparel. To verify this shift and to better
understand our customers, we spent an afternoon in local “hipster” coffee shops and boutiques in Wicker Park in Chicago, where we
spoke with ten individuals whom we believe fit into our target market. In addition to these ten brief interviews, we conducted three indepth interviews with target customers focused on scarves, alpaca products and sustainable fashion. Through our research, we were
able to validate two key assumptions.
(1) There is a market for our scarves: Most of our interviewees owned anywhere from 10-30 scarves, with a couple
favorites amongst them. Their scarf collection was made up of a huge variety of pieces, including different brands, materials, designs
and price points. Most owned one or two expensive, often times cashmere, scarves that cost anywhere from $100-$300, but also
owned scarves that were purchased “for $5 on the streets of NYC.” They generally purchased scarves for warmth, comfort and as
statement pieces and often had good memories and stories associated with their scarf purchases. When we asked our interviewees
about alpaca products, most did not know much about the fiber but were interested to learn more. Interviewees who owned alpaca
scarves, hats or gloves all had positive associations with these products. When we let our interviewees feel a 100% baby alpaca scarf,
they were excited by the warmth and softness and said they would be willing to pay from $50 to $70 for a similar scarf. One boutique
employee was shocked to learn the scarf was not cashmere and eagerly called over one of her co-workers to feel the scarf.
While competition is high in the fashion industry, this information demonstrates that our customers are open and willing to
add new brands of scarves to their closets. Their curiosity and positive associations with alpaca products, as well as the increasing use
of alpaca yarn by many mainstream designers, supports a market for our scarves. Our price point and the story behind our product
should further help to sell Eislee scarves to customers.
(2) Our customers care about sustainable fashion: Many fashion companies are trending towards “slow fashion,” which is
a movement by designers and retail companies to promote transparency in their production process, and favor lasting, well-made
pieces over cheap, disposable apparel. For example, H&M, North Face, Kenneth Cole and Nordstrom produce sustainable apparel
lines. This is further supported by a Deloitte study1, which noted that 84% of the world’s most influential shoppers – the millennials –
believe it is their duty to improve the world and 66% of consumers consider transparency and honesty important when buying a brand.
Despite an interest in sustainable and slow fashion, our interviewees’ purchasing decisions were first and foremost based on
the style and quality of a product. For this reason, Eislee’s primary focus will be on selling attractive, high-quality scarves, with
sustainability as an added feature of our brand story. We also learned that while sustainable purchases make our interviewees “feel
good,” they are either not willing to pay more for a sustainable product, or they are willing to pay only a small percentage more. This
is in line with research done by MarketLine2, which noted most people would pay no more than a 10% premium for an eco-friendly
product. Therefore, we believe it is important that Eislee compete at a price point lower than cashmere; if priced the same, the
majority of consumers will purchase cashmere, as they are less likely to take a chance on an unknown fabric simply because it is
sustainably produced and more eco-friendly.
Market Opportunity
According to the 2012 Accessories Census3, $440 million was spent on scarves in the US, with approximately 40 million
scarves sold. $44 million of this market was sold online. As our company grows, we plan to expand into adjacent products in the
fashion and accessories markets. The US apparel market is a $225 billion industry4 and the US accessories market is a $30.5 billion
industry. Given these values, it is evident that there is significant revenue available within the apparel, accessories and scarf markets.
Competitive Landscape
(1) Companies that sell alpaca scarves: There are two types of alpaca scarves currently on the market:
Type 1
Type 2
Description: Company branding and website aesthetic is oldfashioned, unstylish, and crafty.
Companies identified through a Google search for “alpaca scarf”:
• Alpaca Collections
• Peruvian Connection
• Shupaca
Prices vary greatly from $30 to $120
Eislee differentiator: Accessing a different market, production
methods, style, sourcing.
Description: Stylish younger brands carrying alpaca pieces due to
softness or sustainable production methods, or both.
Companies identified through our research in sustainable fashion:
• Cuyana
• Alternative Apparel
• The Reformation
Prices vary greatly from $65 to $300
Eislee differentiator: Sustainable and ethical sourcing, greater
emphasis on communicating luxuriousness of material.
(2) Producers of cold weather scarves (varied materials): When buying scarves, most individuals are open to different
brands, fabrics and styles. Therefore, it is clear that our competition comes from any company that sells stylish scarves.
•
Cotton or Wool Scarves: Prices and quality vary greatly. The majority of cotton and wool scarves are in line with the
“fast fashion” movement, created from inorganic materials and in factories where labor laws are unclear.
•
Cashmere Scarves: Attractive due to their luxuriousness and perceived quality. Prices are typically high. Excess demand
for cashmere has led to a decline in fabric quality and cashmere herding practices are damaging to the environment.
Note: There are also many silk and linen scarves on the market, but these materials are meant for warm weather and generally worn
as statement pieces only. We therefore do not consider these scarves to be substitutes.
(3) Companies with similar brand mission: Potential customers purchase sustainable clothing and accessories as gifts in
order to share the story and message behind the item with the receiver. In addition, most consumers do not shop entirely sustainable,
but selectively choose a few pieces to add to their wardrobes. Examples of companies with messaging and style similar to Eislee are:
Modavanti, Zady, Everlane, Apolis and Nisolo.
Competitive Positioning
Brand Positioning
“It is not about making sustainable products special, it is about making them normal.” (John Grant, Green Marketing Manifesto) Sustainable fashion is often associated with products that are hippie, unstylish or unusual. We recognize an opportunity to
help bring sustainable mainstream. Our brand will bridge the preferences of our target customers and what our competitors lack by
blending sustainable, fashionable and high quality, and doing so at an affordable price. Our
scarves will therefore have simple, classic designs and colors. While we plan to hire a
designer to give our products unique and recognizable characteristics, they will be similar to
the images to the right.
Note: We are focusing on scarves initially due to their simplicity from a production
standpoint. Scarves are one-size fits all and unisex and unlike clothing, minor
inconsistencies in production will not harm the end product. Scarves are also an ideal
product because many individuals, especially women, own multiple scarves. Once we have
gained traction through sales of our scarves, we plan to explore other alpaca apparel and
accessories, including sweaters, blankets, sweatpants and bags. We also plan to source
from various countries and sell other sustainable products to continue to expand our social
impact reach and lessen the business risk involved in working within one developing
country.
Go to Market Strategy
Our scarves will be sold primarily through an ecommerce platform at eisleedesigns.com. We recognize the importance of the
design of our website, as ecommerce, especially in the fashion world, is about selling an image, rather than simply a product. Our
website will represent this image and will be comparable to websites such as cuyana.com, stoneandcloth.com and nisolo.com.
Our Promotional Story
The following is an example of how Eislee’s story will be shared on our website and other social media platforms:
Marketing
We will drive traffic to our website through grassroots marketing focused on partnerships with fashion influencers (bloggers
and Instragrammers), press and social media. We have made a list of nearly a hundred fashion influencers and resellers, many of
whom we have connections to through our personal networks. While we recognize that being featured via these influencers is
challenging and sometimes costly, we believe that if we reach out to a hundred influencers – each with a varying number of followers
– we can generate interest from at least a small portion of these individuals. It is ultimately our goal to be featured more extensively as
our business grows.
In addition to grassroots marketing, we will run pop-up shops and sell at craft markets and trade shows to increase sales and
market our product to a broader audience. After gaining a strong base of early adopters, we plan to partner with and sell through
sustainable clothing resellers and boutiques. While these retail outlets will lessen our profit margins, we believe they are crucial to
growing our customer base and marketing our company.
Operations
The following demonstrates the process from sourcing through sales for our alpaca scarves:
Revenue Model
Eislee will generate revenue from sales of our products, which will
Bill of Production
1
initially be 100% baby alpaca scarves in one design and varying colors. Our
scarves will primarily be sold direct to the customer and priced at $65. This
2
3
4
price point is less than all quality cashmere scarves on the market and less
than or equal to alpaca scarves of similar design and quality. Additionally, at
this price, we are able to achieve a reasonable markup from cost
(approximately 2.5x).
5
6
7
Item Description
Cost
5
Alpaca yarn
10.17
Scarf production
6
9.95
Packing and shipping to US
Import tariff
7
6
0.37
1.93
8
Tags and packaging *
9
Transaction fees *
0.18
1.95
10
Shipping to customer *
2.73
Total Cost per Scarf
$27.29
*Not included or lower when selling wholesale.
We plan to initially fund Eislee via a crowdsourcing campaign on Kickstarter, supplemented by funds from personal
investment, as well as friends and family. We will hold our Kickstarter campaign in June 2015 with a guarantee delivery of scarves to
our backers by October 2015. Crowdsourcing will provide us with the upfront costs to fund our first production run, which will
produce enough inventory to deliver scarves to our Kickstarter backers, as well as additional inventory to carry us through the winter
2015-2016 season. Profits from this production run will be reinvested in the company for a new line of scarves and other products.
Business Analogues
There are number of successful retail businesses with similar models and social impact elements to their story. Nisolo, an
ecommerce shoe company, promotes the style and quality of their shoes first and foremost, and details the importance of their
production methods and social impact as a part of their brand story. Everlane, an ecommerce clothing company, details every cost that
goes towards creating an article of clothing in order to support “radical transparency.” Zady and Modavanti are both ecommerce
companies that resell various sustainable brands. The popularity of these companies, and the funding that they have received, signals a
market interest in mindfully and ethically produced apparel.
Progress to Date
Since formation in Fall 2014, the Eislee team has spent significant time developing a better understanding of the alpaca
industry in Peru and the fashion industry in the US. This includes substantive discussions with Peruvian alpaca cooperatives, impact
investors and textile manufacturers. In mid-February 2015, we plan to sell forty 100% baby alpaca scarves, similar in design to the
ones we will produce, in the lobby of local apartment building to get feedback on design, quality and price points. Our major goals
over the next several months are as follows: (1) develop our presence on social media – @EisleeDesigns on Instagram and Twitter, (2)
visit Peru to meet with COOPECAN, Rhin Textils and other cooperatives and manufacturers, (3) design our first style of scarves, (4)
formalize agreements with our cooperative and manufacturer and begin production of a first run of scarves, and (5) launch our
Kickstarter campaign and website. We plan to have our first run of scarves ready to sell by early Fall 2015.
Business Risks
Management Team and Advisors
Name/Title
Experience
Kate O’Connor
Co-Chief
Executive Officer,
Co-Founder
Kate has four years of consulting experience with project management and process improvement expertise.
She also has an extensive network in the digital marketing and start-up space. Kate is currently in her first year
at the University of Chicago Booth School of Business, working toward her MBA.
Sara Raffa
Co-Chief
Executive Officer,
Co-Founder
Sara has two years of high-end retail experience and four years of internal audit experience with a focus on
control design and optimization. She spent several months collaborating with the founders of Zombie Coffee,
a youthful coffee concept that sources coffee beans from a cooperative in El Salvador. She has extensive
connections in the non-profit and fashion industries and has visited Peru to explore the Eislee concept. Sara is
currently in her first year at the University of Chicago Booth School of Business, working toward her MBA.
Recognizing gaps in experience within the core management team, we plan to bring on a team member with a Peruvian
background or experience in international impact investing and a team member with design and fashion experience. We also have
several advisors that are involved with the team on an informal basis, providing valuable insights as well as industry connections.
Name/Title
Experience
Alberto Jabiles
MBA Candidate, UChicago Booth
Alberto is a native of Peru who has worked for several Peruvian NGO’s. He has a strong
network with experience in impact investing and the textile industry in Peru.
John O’Connor
President/CEO, JSO Digital
John owns a digital marketing agency with experience in website design and management,
content creation, and social media. He is the founder of several additional start-ups.
Nicole Raffa
Photo Stylist, Thrillist Media
Nicki has seven years of experience in the fashion industry as a personal shopper and fashion
stylist. She holds a degree in Fashion Marketing from Parsons School of Design.
Brad Jeffery
Founder/CEO, Causegear
Brad is a Chicago-based entrepreneur working on a social venture to support impoverished
crafters in India. He has extensive insight into challenges faced as a sustainable fashion startup.
Trevor Fay
MBA Candidate, UChicago Booth
Trevor is passionate about impact investing, completed a Fulbright fellowship in rural Brazil,
and managed over 400 undergraduate chapter leaders internationally at Net Impact.
1
"Value Opportunities in Sustainable Fashion." Deloitte, 12 June 2014. Web. <http://www.slideshare.net/Deloittesustainability/valueopportunities-in-sustainable-fashion?related=1>.
2
Moody, Kate. "Sustainable Fashion: A Growing Trend." MarketLine, 21 Feb. 2013. Web.
<http://www.marketline.com/blog/sustainable-fashion-a-growing-trend/>.
3
"Accessories Census 2012." Accessories Magazine. N.p., Mar. 2013. Web.
<http://www.accessoriesmagazine.com/downloads/accessories-census-2012>.
4
Facts on the Apparel Market in the U.S." Statista, Aug. 2013. Web. 06 Feb. 2015. <http://www.statista.com/topics/965/apparelmarket-in-the-us/>.
5
Based on a pricing sheet from COOPECAN, yarn will cost an average of $67.81 per kilo (price varies based on the color of the
yarn). Our scarf design weighs approximately 130g. This value assumes 20g of waste and thus a total of 150g per scarf. Note that
using a similar calculation, yarn from Michell in Peru would cost 6.94 per scarf.
6
Based on discussion with Alex Jacoby, a Contracts Manager at Rhin Textil, which is a factory in Peru that complies with PVH
requirements for ethical treatment of factory workers and quality standards. He provided a breakdown of costs as follows: Knitting
$5.50, Dry Cleaning $3.50, Labeling $0.95, Packing $0.12 and Shipping $0.25. Additionally, he noted that he can buy the yarn
straight from COOPECAN so that we can avoid Peru's 18% sales tax on the yarn.
7
Import tariffs on the finished scarves are 9.6% of the cost. This is under tariff code 61171010 of US-Peru Trade Promotion
Agreement. 19 USC 3805 <http://www.ustr.gov/sites/default/files/uploads/agreements/fta/peru/asset_upload_file837_9523.pdf>
8
Hang tags from UPrinting will cost approximately $0.05 each and tissue paper from The Packaging Source will cost approximately
$0.13 per scarf ($29.90 for 480 sheets, assumes 2 sheets per scarf). <http://www.uprinting.com/clothing-hang-tags.html>,
<http://www.packagingsource.com/store/c/3445-Solid-Color-Tissue-Paper-Made-in-USA.html>
9
Merchant processing fees generally range from 2.5% to 3%. This figure is based on an average 2.75% processing fee of a price of
$71.01 ($65 price plus Chicago sales tax of 9.25%).
10
Cost of shipping within the US based on USPS pre-sort bulk rate, first class. <http://dbcalc.usps.com/CalculatorSetPage.aspx>.