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JANUARY 5, 2009 | BUSINESS PLAN | CONFIDENTIAL

| CONTENTS | 1

EXECUTIVE SUMMARY

5 THE OPPORTUNITY 6 The Coworking Trend 9 THE LAUNCHPAD DIFFERENCE 10 Bricks and Mortar 19 MARKETING & SALES

19 Positioning



22 Marketing Channels



24 LaunchPad Coworking in the News



25 What people are saying



26 Pricing

29 PRO FORMA INCOME STATE­M ENT 35 THE TEAM

35 CEO: Julie Gomoll



36 General Manager: Tina Rosenzweig



36 Writer in Residence: Spike Gillespie



37 Marketing Manager: Susan Price



37 User Experience Architect: Tori Breitling



36 Senior Consultant: Marie Hwang



38 Development Team: Integral Concepts



39 Architect: Murray Legge



39 Design Team: EmDash

EXECUTIVE SUMMARY LaunchPad Coworking, located in downtown Austin, provides a unique opportunity for independent and mobile workers to gather in a space that combines the best elements of well designed workspace with the comforting buzz of a neighborhood café. Whether simply working solo in the presence of one another or collaborating with others, coworkers increase productivity, fend off the pitfalls of working alone, and enjoy a chance to network organically. Because coworking inspires the free flow of ideas among coworkers from numerous disciplines, there is the added benefit of accelerated serendipity: great ideas that spring up through spontaneous brainstorming. LaunchPad Coworking CEO Julie Gomoll and her team have created an optimal environment for coworkers to work independently or collaboratively and to meet with teams or clients without having to deal with long-term leases, high overhead, or cramped corporate offices. And though LaunchPad offers great office perks, there’s not even a whiff of Dilbert in the place. Forget generic cubicles and cookie-cutter office suites. LaunchPad Coworking is Office 2.0. LaunchPad Coworking also supports environmental awareness through the use of green building materials and a cafe carefully designed to minimize waste, promote fair trade and support local vendors. Centrally located at 800 Brazos, LaunchPad Coworking is 4 blocks from the Texas State Capitol and just 1 block east of Congress Avenue.

L A U N C H PA D C O W O R K I N G + C A F E | 1

2 | L A U N C H PA D C O W O R K I N G + C A F E

Coming together is a beginning; keeping together is progress; working together is success. HENRY FORD Fo u n d e r o f Fo r d M o t o r C o m p a n y

L A U N C H PA D C O W O R K I N G + C A F E | 3

THE OPPORTUNITY “Workplace expert Steve King of Emergent Research in Lafayette, who studied coworking as part of a report on the future of small business, predicts that co-working is poised for a big takeoff. That’s due to the growing number of one-person businesses, which rose from 16.5 million in 2000 to 20.4 million in 2005, according to the U.S. Census Bureau.” – “Shared Work Spaces a Wave of the Future” The San Francisco Chronicle, February 2008

‘One-third of the U.S. workforce is employed inde­pendently as freelancers, consultants, temps, part-timers, and self-employed workers.” – Democratic Leadership Council, July 2006

“A 2007 CDW survey of over 2,000 workers showed that 79% of workers employed in the private sector and half of workers employed in the public sector were worried about feeling isolated and missing human interaction if they were to start telecommuting. Roughly a third of both private and public-sector workers also reported that they didn’t want to stay at home during work.” – Business Week, February 2007

L A U N C H PA D C O W O R K I N G + C A F E | 5

THE COWORKING TREND In the early 90s, the general public was barely aware of the Internet much less its potential. Yet within 5 years the Internet was commonplace and in another 5 years wifi access became practically ubiquitous. As with Internet awareness, the coworking buzz started out as an underground hum. That hum has rapidly grown louder. What began as small groups of independent workers seeking human interaction in a shared workplace has yielded a movement that is gaining tremendous momentum. New spaces are opening up regularly around the globe. And a growing number of publications including The New York Times,The San Francisco Chronicle, Business Week, and Fortune have picked up on the story and are tracking the trend. The current economic environment has created an even greater demand for alternative places to work. More and more workers are striking out on their own, companies are encouraging telecommuting to reduce their bricks and mortar expenses, and global companies are turning to video conferencing to reduce their travel costs. All these mobile employees need places to work and to hold meetings. As with the Internet, it’s only a matter of time — a short period of time — before coworking becomes a commonplace experience. And where better than Austin to open the first coworking café?

6 | L A U N C H PA D C O W O R K I N G + C A F E

Never doubt that a small group of thoughtful, committed people can change the world. Indeed, it is the only thing that ever has. MARGARET MEAD Anthropologist

THE LAUNCHPAD DIFFERENCE “Most [coworking spaces] seem connected somewhere between the communalism of the 60s and the whimsy of the dot-com days of the 90s... The coworkers, armed with Wi-Fi laptops and cellphones, are in some ways offering a techie twist on the age-old practice of artists or writers teaming up to rent studio space.” “They’re Working on Their Own, Just Side by Side,“ New York Times, Feb. 2008

Many existing coworking spaces operate as cooperatives for tenants who chip in to pay the monthly rent. Often, these sites are run as break-even operations. LaunchPad Coworking is a for-profit business. Rather than rely on anchor tenants to cover expenses, LaunchPad offers workspaces and meeting rooms for rent on demand, with a cafe that is open to the public.

L A U N C H PA D C O W O R K I N G + C A F E | 9

BRICKS AND MORTAR COWORKING AREA LaunchPad will cater to mobile workers craving a better place to work. It will provide them with comfortable workspaces, opportunities for collaboration, places to meet with clients, and a cafe. The physical space is being designed in collaboration with Murray Legge of LZT Architects, to serve as a platform from which a robust community can emerge.

INDIVIDUAL WORKSPACES • 30 individual workspaces available for advance reservation or on a drop-in basis • Available by the hour with discounts for bulk purchases • Wired fiber-optic internet access • Secure wifi • Quality, ergonomic chairs • Large, flat screen monitors • Open areas designed for active collaboration • Custom, modular desks • Ample outlets and network drops • Access to printers, scanners, fax machines and general office amenities • Optimal, versatile lighting throughout

MEETING ROOMS There will be six unique meeting rooms. Each will have wired fiber-optic connectivity, wifi, white board, an iPod dock, and speakerphone. • Small meeting room 1 — seats 6 with table and chairs. • Small meeting room 2 — seats 6 with table and chairs. • Small meeting room 3 — seats 6, can be used as Podcast studio, and will be sound-dampened. • Medium meeting room — seats 12 with conference table and chairs. • Conference room — seats 16–30, with a modular, flexible setup to facilitate meetings, training, workshops, presentations, and events. • Treehouse — seats 4–5 and is cantilevered over the café.

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L A U N C H PA D C O W O R K I N G + C A F E | 11

13'-6"

OF MEETING ROOM

13 sq ft WALL IUS 1'-0"

TING ROOM

t

OM

13'-11"

D10

D09

D07

SUITE 300

A1

MARKER SURFACE

A1

3'-1"

1'-10"

12'-51/4"

A1

2'-1"

CORRIDOR 114 A: 154 sq ft

2'-2"

1

ALLEY

1 A-202

C

9'-3"

W04

A

12'-41/2"

TABLES (N.I.C.)

SCALE: 1/4" =

D08

MEETING ROOM 111 A: 137 sq ft

A1

E

13'-11"

13'-6"

C

A

C

C

CONCIERGE

EP

A1

MARKER SURFACE

A1

B

A1

A

5'-6"

MOBILE WORK STATIONS

D14

1'-10"

A-201

CORRIDOR 114 A: 154 sq 1 ft

A1

A1

2'-1" A1 W03

D15

D11

D08

A1

D04

74'-119/16"

C

LINE OF FLOOR STRUCTURE BELOW

LINE OF GREASE TRAP CLOSET BELOW

WOOD

W02

A

5'-3"

UTILITY ROOM 103 A: 52 sq ft

A

3'-6"

BUILT-IN WORK STATIONS

BOOK SHELF (N.I.C.)

OFFICE 113 A: 108 sq ft

A

MEETING ROOM 112 A: 102 sq ft

A

MEETING ROOM 111 A: 137 sq ft

A1

12'-41/2"

TABLES (N.I.C.)

COWORKING AREA 104 A: 1,460 sq ft

QT

FD E26

E23

E

E

3'-1"

D16

LOBBY

E21 E9

E8

E10

CONCIERGE Legge. File Path: LZTA-02:Data Files:2007:07024 Launchpad:00-CAD-Projects:1presdes:07024 ArchiCAD Models:800 Brazos Model:LZT 07024 lp800.pln FOOD

1'-0"

EP

6'-1"

D12

D10

D09

D07

EP ELEC. ROOM D13 110 C A: 38 sq ft

W04

STORAGE ROOM 109 A: 67 sq ft

B

SOUND-PROOF MEETING ROOM 108 D A: 102 sq ft

B

MEETING ROOM C 107 A: 113 sq ft CYCLORAMIC WALL CORNER RADIUS 1'-0"

A

MEETING ROOM 106 A: 250 sq ft

23'-2"

FIRST FLOOR PLAN

COWORKING AREA 104 A: 1,460 sq ft

A1

IT ROOM 105 A: 50 sq ft

MARKER SURFACE

W04

BUILT IN BOOK SHELVES-SEE DRAWING 1/A-301

D17

A1

MOP SINK

C

(N.I.C.)

TABLES W01

DESK (N.I.C.) F

D05

W03

WOOD

EMPLOYEE STORAGE

EXISTING TILE

WOOD

1 A-201

EXISTING EXIT DOOR

LINE OF FLOOR STRUCTURE BELOW CAFE 102 A: 741 sq ft

LINE OF GREASE TRAP CLOSET BELOW

MOBILE WORK STATIONS

LINE OF EXISTING ATRIUM SOFFIT ABOVE

CONCIERGE

LINE OF MEETING ROOM ABOVE

EXISTING RESTROOMS (N.I.C.)

WATER FILTRATION REFER TO MECHANICAL

E

W04

D04

W02

FD

E22

E26

+/- 18'-11"

E21 E9

E16

FD

E14

E20

BAR 101 A: 256 sq ft

E23

E8

E10

EXISTING FIRE E17 EXIT STAIR

QT

5'-3" CONCIERGE FOOD

A

UTILITY ROOM 103 A: 52 sq ft

A

3'-6"

BUILT-IN WORK STATIONS

10'-5"

9'-91/2"

6'-1"

A-101 FIRST FLOOR PLAN : Plotted on 5/10/08 at 11:50 PM by Murray

W05

C

C

7'-6"

A

9'-1"

D06

3'-1" 1'-10" 2'-2" 2'-2" 3'-5"

8'-3"

6'-5"

12'-51/4" 9'-1" 9'-0"

E15

E19

E11 E12 E13

F

3'-0"

EP

E25

E4

E7

TABLES (N.I.C.)

E24

F

FD

KITCHEN 100 A: 194 sq ft

DESK (N.I.C.)

EXISTING RESTROOMS (N.I.C.)

D02

MOP SINK

WATER FILTRATION REFER TO MECHANICAL

BUILT IN BOOK SHELVES-SEE DRAWING 1/A-301

W01

F

E5

E27

E1

E2

D05

D03

4'-2"

C

2'-4"

1 A-201

W05

1'-11"

1'-9" 2'-8"

1 A-202

EMPLOYEE STORAGE

DISHWASHER (CMA DISHMACHINES: MODEL: 180UC) DISHWASHER RACK STORAGE 4' METRO WIRE SHELVING SLICER REACH-IN REFRIGERATOR (TRUE FOOD SERVICE: MODEL T-35) FOOD PREP TABLE (TRUE FOOD SERVICE: MODEL TSSU-48-12) PREP TABLE BEER & WINE COOLER PANINI GRILL DRAFT BEER TAP WATER WARMER ICE MAKER WITH STORAGE BIN (HOSHIZAKI: MODEL F300BAF) COFFEE MAKER UNDER COUNTER REFRIGERATOR (TRUE FOOD SERVICE: MODEL TUC-27) ESPRESSO MACHINE (LA MARZOC CO: MODEL FB/80) CASH REGISTER FOOD DISPLAY CASE NOT USED COFFEE GRINDERS BREW COFFEE GRINDER TOASTER HANDSINK UNDERCOUNTER REACH IN FREEZE HAND SINK FOOD SINK DUMP SINK THREE COMPARTMENT DISH SINK

NEW WALLS- REFER TO A-203

EXISTING WALLS TO REMAIN- REFER TO ROOM FINISH SCHEDULE

327.972 sq ft

*DENOTES APPLIANCE SHALL BE SUPPLIED WITH FILTERED WATER

E1 E2 E3 E4 E5 E6 E7 E8 E9 E10 E11 E12* E13* E14 E15* E16 E17 E18 E19 E20 E21 E22 E23 E24 E25* E26* E27

MARK EQUIPMENT

EXISTING FIRE EXIT STAIR

THESE DOCUMENTS ARE FOR INTERIM REVIEW AND NOT INTENDED FOR BIDDING, PERMIT, OR CONSTRUCTION PURPOSES. 5/10/08 MURRAY LEGGE, TEXAS REGISTERED ARCHITECT 16791

EXISTING EXIT DOOR

5/10/2008

A-101

FIRST FLOOR PLAN

SHEET TITLE:

# DATE DESCRIPTION 1 4/22/2008 PERMIT SET

ISSUES:

PROJECT No.: PLOT DATE:

07024

PROFESSIONAL'S SEAL

THIS DOCUMENT, THE IDEAS AND DESIGNS INCORPORATED HEREIN ARE AND SHALL REMAIN THE PROPERTY OF LZT ARCHITECTS, INC. THESE DOCUMENTS ARE NOT TO BE USED, NOR ARE THEY TO BE ASSIGNED TO ANY THIRD PARTY WITHOUT WRITTEN PERMISSION FROM LZT ARCHITECTS, INC.©

ENCOTECH ENGINEERING CONSULTANTS, INC. 8500 BLUFFSTONE COVE, SUITE B-103 AUSTIN, TEXAS 78759 P 512-338-1101 F 512-338-1160

MEP:

SUITE 202 4107 SPICEWOOD SPRINGS RD. AUSTIN, TX 78759 P 512-343-6088 F 512-343-1398

LZT ARCHITECTS, INC.

lzta

LAUNCHPAD

1 A-201

1'-9"

W06

10'-5"

800 BRAZOS STREET, SUITE 305 AUSTIN, TX 78705

ALLEY

4'-2"

E6

1'-2"

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3

4

A1

MEETING ROOM 112 A: 102 sq ft

A

=

1'-0"

A

=

D16

E

1'-0"

E

E

B

SCALE: 1/4"

CONCIERGE

4'-8" WOOD

CAFE 102 A: 741 sq ft

LINE OF FLOOR STRUCTURE BELOW

LINE OF GREASE TRAP CLOSET BELOW

LINE OF EXISTING

LINE OF MEETING ROOM ABOVE

SLIDER

C

PLYWOOD SUBFLOOR OVER METAL DECK LIGHT GAUGE STEEL FRAMING

WALLS BELOW

FIRST FLOOR FRAMING PLAN

A

MEETING ROOM 111 A: 137 sq ft

A1

12'-41/2"

TABLES (N.I.C.)

SCALE: 1/4"

C

TUBE STEEL BEAM

TUBE STEEL BEAM

EXISTING COLUMN

SECOND FLOOR FRAMING PLAN

6

5 TUBE STEEL BEAM

4" DIA. COLUMN

4

3

4" DIA. COLUMN

2

7'-6"

B

SCALE: 1/4"

1

=

B

B

B

B

B

B

B

B

B

B

B

B

B

B

B

MEETING ROOM BELOW

B

B

B B

B

B

B B

B

B

1'-0"

B

B

B

B

B

B

B

B

SCALE: 1/4"

=

1'-0"

MEETING ROOM 200 A: 21 sq ft

POLYGAL INTERIOR SKYLIGHT

B

SECOND FLOOR PLAN

A

C

PANELITE WALL

C

B

B

B

B

B

B

B

B

B

B

B

CEILING "B"

B

B

B

B

B

B

B

B

B

B

B

EXISTING WINDOWS TO REMAIN

LOUVERS AS SHOWN ON A-302

B

B

B

B

B

B

B

B

B

B

B

A11 A10 A9 A8 A7 A6 A5 A4 A3 A2 A1 A1 A1 A1 A1 A1 A1 A1 A1 A1 A1 A1 A2 A3 A4 A5 A6 A7 A8 A9 A10 A11

B

SECOND FLOOR CEILING PLAN

LINE OF WALLS BELOW

2

A

07024

A-102

SECOND FLOOR PLAN

SHEET TITLE:

# DATE DESCRIPTION 1 4/22/2008 PERMIT SET

ISSUES:

PROJECT No.: PLOT DATE:

4/22/2008

PROFESSIONAL'S SEAL

THIS DOCUMENT, THE IDEAS AND DESIGNS INCORPORATED HEREIN ARE AND SHALL REMAIN THE PROPERTY OF LZT ARCHITECTS, INC. THESE DOCUMENTS ARE NOT TO BE USED, NOR ARE THEY TO BE ASSIGNED TO ANY THIRD PARTY WITHOUT WRITTEN PERMISSION FROM LZT ARCHITECTS, INC.©

MEP: ENCOTECH ENGINEERING CONSULTANTS, INC. 8500 BLUFFSTONE COVE, SUITE B-103 AUSTIN, TEXAS 78759 P 512-338-1101 F 512-338-1160

SUITE 202 4107 SPICEWOOD SPRINGS RD. AUSTIN, TX 78759 P 512-343-6088 F 512-343-1398

LZT ARCHITECTS, INC.

lzta

LAUNCHPAD

A

800 BRAZOS STREET, SUITE 305 AUSTIN, TX 78705

1

2'-4"

A-102 SECOND FLOOR PLAN : Plotted on 4/23/2008 at 10:23 AM by dcarroll. File Path: G:\Data Files\2007\07024 Launchpad\00-CAD-Projects\1presdes\07024 ArchiCAD Models\800 Brazos Model\LZT 07024 lp800.pln

L A U N C H PA D C O W O R K I N G + C A F E | 13

ALSO AVAILABLE FOR RENT/USE • High definition video conferencing • Presentation equipment • Chargers for computers and phones • Noise-canceling headphones • Large flatscreen monitors

• PC Locks • Secure storage • Laser printer • Fax machines

WATER LPC will have delicious, excellent-quality filtered water. Customers in the coworking area will enjoy free water in reusable, branded glass bottles that reflect LaunchPad’s emphasis on sustainability. The unique, reusable bottles will also be available for purchase in the cafe.

CAFE As the first space customers enter, the LaunchPad Café serves as a central hub for the facility. It is a casual environment with free secure wifi, and it is an area conducive to working or socializing. The cafe’s staff is knowledgeable and friendly, and the menu features light, healthy fare. In keeping with LaunchPad Coworking’s environmentally aware, green-friendly philosophy, the café features • Fair trade organic coffee • Recycling (newspaper, cardboard, glass and aluminum) • Composting • Organic local ingredients whenever possible • Reusable dishes whenever possible • Biodegradable paper goods

14 | L A U N C H PA D C O W O R K I N G + C A F E

• Sun tea • Non-incandescent and natural lighting • Repurposed and green building materials

L A U N C H PA D C O W O R K I N G + C A F E | 15

TECHNOLOGY SPACER A simple, smooth customer experience is critical to the success of LPC. Because we are asking people to pay for space and connectivity, we must remove as many barriers to entry as possible. Existing reservations systems cannot provide a seamless user experience. Therefore, LPC is building its own cutting edge software, Spacer, which integrates hourly individual space and meeting room reservations into a single web-based application. Members will be able to log into their accounts from anywhere to check on the availability of space and make reservations. Additional items, such as food, drink, or rental items, can be charged to a single account. Customers can get a record of all transactions at any time. Spacer is being built with the intention of growing it into a system that will support multiple locations. When the software is ready for commercialization, a spinoff company will take over the continuing development.

INFRASTRUCTURE LPC has 1gbit fiberoptic connectivity directly to the building, and will have 10mbit upstream and downstream home runs for all coworking customers. Patrons of the coworking area can plug into this super-fast, reliable network from any station and in every meeting room. At the heart of this network is a Cisco 2821 router connected to Cisco Catalyst 1000base-T active Ethernet switches. 3 points of presence provide secure wifi throughout the coworking area and the cafe. Additional caching will be employed to provide even more speed. LPC will use Apple XServers to host Spacer, manage the network, and provide backup. The setup includes a mirrored server onsite to provide a hotsync backup if necessary. The disaster recovery plan includes off-site storage of all critical systems on a weekly basis.

16 | L A U N C H PA D C O W O R K I N G + C A F E

Great discoveries and improvements invariably involve the cooperation of many minds. I may be given credit for having blazed the trail but when I look at the subsequent developments I feel the credit is due to others rather than to myself. ALEXANDER GRAHAM BELL Inventor

MARKETING & SALES POSITIONING The goal of LaunchPad Coworking’s marketing and sales efforts is to reach and maintain optimal capacity with a mix of advance reservations, walk-in customers, and café patrons. Everything about LPC, from the underlying mission and philosophy to the space design — including furniture and floor covering choices, and the café menu — is informed by shared ethics and underlying philosophies that resonate deeply with the target market: • Community • Collaboration • Sustainability • Transparency

• Fairness and shared responsibility • The importance of user-centered design

GOALS Sales goals and driving strategies are in place for each revenue stream, including open coworking presales and meeting room sales, videoconferencing, meeting room rentals, and café sales. PR, advertising and event plans are timed to drive the necessary demand to support the sales figures.

TACTICS LaunchPad Coworking will reach and maintain optimal capacity through the following marketing and sales efforts: • Implementation of a social media-oriented marketing plan • Search Engine Optimization (SEO) • Hosting specific LPC events timed to take advantage of annual conferences held at the Austin Convention Center, events at the University of Texas, and the seasonal congregation of the Texas State government. • Tapping into Austin’s reputation as a high-tech center with a high degree of adoption of web technology and an extremely tech-savvy customer base. • Promoting LPC as an excellent location for corporate interview sessions during job fairs.

TARGET MARKET • Independent Austin-area

mobile workers including self-employed or freelance designers, consultants, writers, architects, engineers, webmasters L A U N C H PA D C O W O R K I N G + C A F E | 19

• Small-firm

service providers including accountants, lawyers, consultants • Local knowledge workers including self-employed and company-employed workers with the flexibility to telecommute • Business travelers seeking an alternative to hotel business centers or copy shops • Affinity group members including Refresh Austin, Bootstrap Austin, Society for Technical Communication, AIA, AIGA, BarCamp, GeekAustin, and the Austin Film Society. • Attendees of conferences such as SXSW, Austin Film Festival, Austin City Limits Festival, and job fairs • Coffee shop regulars seeking a more work-friendly environment

MARKET QUALIFIERS The coworking trend is emerging in high-tech centers across the world. With a management team ideally suited to create a cutting edge experience, LaunchPad Coworking will occupy an emerging niche in Austin that will set the international standard for the for-profit coworking model and prove its success. LaunchPad Coworking will occupy an emerging niche that specifically appeals to • People with some college education through advanced higher education • Entrepreneurs • Workers in Austin’s high tech and creative industries • Business travelers in Austin for a conference or other brief business trip Our strategy will rely heavily on reaching • People with laptops • Computer users already familiar with wireless technology and the internet • People with incomes over $60,000/year

CONTINGENCY PLANS If we have fewer customers than projected, we will refocus efforts on recruiting corporate customers to use LaunchPad as their overflow space. If we have more customers than projected, we will contract to rent additional contiguous space, for which we have the right of first refusal. We have designed the space to be flexible, so if we have miscalculated the interest in coworking vs meeting rooms, we can adjust the space accordingly.

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LOCATION, LOCATION, LOCATION LaunchPad Coworking’s location was carefully selected to best take advantage of the existing demand for coworking in Austin. Brazos Place, a mixed-use condominium development, is located right downtown at 800 Brazos. Our neighbors in Brazos Place include • Baby Greens — salads to go • Ana’s Mart — urban grocery • Anthony Nak — hip, hot independent jewelry designer LaunchPad Coworking is • 4 blocks from the Capitol • 7 blocks from the Convention Center • Within walking distance of 13 hotels • Around the corner from the Paramount and State Theaters

DOWNTOWN AUSTIN DEMOGRAPHICS (3 MI. RADIUS)

7,000,000 TOURISTS VISIT AUSTIN ANNUALLY 363,000 RESIDENTS WITHIN A 10 MINUTE DRIVE FROM 6TH AND CONGRESS

State Capitol

$104,654 AVERAGE INCOME IN THE MARKET AREA BY 2008



67,000 DOWNTOWN EMPLOYEES EACH DAY



52,426 UNIVERSITY OF TEXAS STUDENTS

Waterloo Park 12TH

LIVE IN OR NEARBY DOWNTOWN

RED RIVER

N AC H E S

TRINITY

S A N J AC I N TO

TO DOWNTOWN AREA

11TH

B R A ZO S

3,000,000 VISITORS PER YEAR

C O N G R E S S AV E N U E

(80% AVERAGE OCCUPANCY RATE)

C O LO R A D O

3,840 AVERAGE NIGHTLY HOTEL OCCUPANTS

L AVAC A

Market District

Warehouse Entertainment District

2nd Street Retail District

10TH

9TH

8TH

-Downtown Research Associate

Congress Avenue District



29,000 DOWNTOWN PARKING SPACES G U A DA L U P E



7TH

East 6th Street Entertainment District

6TH

5TH

4TH

3RD

Austin 2 N D Convention Center C E S A R C H AV E Z

L A U N C H PA D C O W O R K I N G + C A F E | 21

COMPETITION • Wifi-equipped coffee shops and restaurants — some are adapting to better accommodate mobile workers, but restaurant pricing models and customer expectations mean these adaptations still aren’t sufficient. • Executive Suites — spaces that include reception, package delivery, mailing addresses, kitchen and break rooms, administrative and other office infrastructure enjoy healthy demand in the Austin area. They are expensive, however, and often just as isolating as working from home. • Virtual offices — like executive suites, but used as needed by travelers. • FedEx Kinkos — available in most cities, and very well known. Many locations also provide video conferencing. The general atmosphere, however, is not very professional. • Traditional corporate offices — many companies have outgrown their office space and need spillover office space. • Hotels — the hospitality industry provides viable alternatives for both solo workers and large events. There’s a middle ground demand for small-group meetings that is currently underserved. Hotels don’t find 2-10 person meeting rooms profitable. • Home — workers increasingly are negotiating with their employers for flexibility in scheduling and working from home.

MARKETING CHANNELS The LPC team is a well-rounded group, with connections in the entrepreneurial, media, entertainment, business, design, and technology communities around town and throughout the world. The team is already fully engaged in a carefully choreographed online awareness campaign to position LaunchPad Coworking within this larger community and leverage the available internet buzz and viral word of mouth marketing. Specific efforts include • LaunchPad Coworking: The Official Blog — Already live and enjoying healthy traffic, the blog is a key part of LPC’s content and marketing strategy. It features insightful essays written to engage customers in conversations about coworking, and news tidbits of interest to our customer base with analysis written in a style that reflect the LPC personality, ethics and brand. The varied voices of the blog share information directly about the selection and build-out of the space, café menu and coworking amenities capitalize. Lively discussions about the important coworking trend, with comments from Austin and across the U.S. create interesting dialog with ideas and insights. The blog is already building the community that will ensure LPC’s success. 22 | L A U N C H PA D C O W O R K I N G + C A F E

• Social Media clubs and high tech affinity groups — Key team members belong to a wide range of local networking groups, including Bootstrap Austin, GeekAustin, Refresh Austin, and the Coffee Think Tank. • Other coworking groups — Coworking as a separate movement and phenomenon is showing surprisingly rapid adoption across the world in high tech cities, and the founders and promoters of these separate efforts collaborate remotely, freely sharing successes and lessons learned. These contacts and links from other coworking locations will help travelers find us and build our brand both in the US and worldwide. • Partnerships — LPC will work with Lance Armstrong and his new company, Mellow Johnny’s, to provide “free parking” for customers who bicycle to work. • Sponsorships — LPC will work with Nova Science Now to host Science Cafes. • PR — The press, including newspapers, television and the blogosphere, are embracing and featuring LaunchPad Coworking as a key indicator of the next evolutionary step in office workspaces. The coworking trend is getting significant notice, and Launchpad Coworking offers a newsworthy twist to the coworking story, with its innovative, for-profit model and strategy of pairing remote collaboration tools with a face-to-face space. • Events — LPC sponsors events within the Austin community to attach the key brand elements of innovation and creativity to the brand. Examples L A U N C H PA D C O W O R K I N G + C A F E | 23

include a SXSW-interactive meetup for coworking, a SXSW discussion on Transparency in Business, and an InnovationCamp. The event strategy allow LPC to create business-to-business relationships and partnerships with other Austin-area companies as well as create the LPC community, raise awareness and strengthen the brand image. • Special marketing initiatives will be timed to take advantage of events at the University of Texas, the Convention Center, and the Texas State Government.

SEARCH ENGINE OPTIMIZATION AND SOCIAL MEDIA STRATEGY A carefully orchestrated combination of official LaunchPad blog posts, commenting strategy in other blogs and forums, Twitter, Linkedin, Meetup, Magnolia, Facebook and LinkedIn presences, RSS feeds and other proprietary social media strategies have boosted LPC’s search engine results for selected keywords consistently over the months since its inception. There is already measurable demand for LPC space and reservations well in advance of the opening date. The press has already taken notice.

LAUNCHPAD COWORKING IN THE NEWS “Instant Coworkers,” Omar Gallaga, Austin American-Statesman, July 6, 2008 “Co-working is taking off in San Antonio,” Laura A. Lorek, San Antonio Express-News, Feb. 21, 2008 “LaunchPad finds a pad for telecommuters” Austin Business Journal, Feb. 13, 2008 “Out of the Office,” Mary Hooper, Austin Business Journal, Feb. 1, 2008 ( C O P I E S O F T H E S E A RT I C L E S A R E AT TAC H E D TO T H E H A R D C O P Y O F T H I S D O C U M E N T. ) 24 | L A U N C H PA D C O W O R K I N G + C A F E

WHAT PEOPLE ARE SAYING Hello! I think co-working is a fantastic idea and I’m excited that something concrete is being put together in Austin. I spend countless hours a week hunkered down in coffeeshops, so I’m keenly interested in what you guys are doing. Please add me to your mailinglist.Best of luck, – Adnan Hi, I saw your site and I think this is a great idea! Looking forward to your opening in July...please keep me informed! – Elena Hi there LaunchPad, My name is Jenn Davis, and I’m a graduate student at UT in Organizational Communication. I just wanted to say what a great idea I think this is, and I’m very much looking forward to seeing the space when you open and giving this coworking thing a try! My husband and I both work from home, and we’ve been looking for something just like this for those days when we need to get out of the house. Please add me to your list for the opening party. I can’t wait to see the space in July! Thank you, Jenn Hello! I’m a web worker in Austin and I recently read about your plans to launch a coworking spot in downtown Austin. I’m excited about what you are doing and can’t wait to see the end result. I’d like to be on any kind of mailing list and receive any additional info about theproject. Let me know if you need any extra info from me. Thanks! Larry Kubin Innovation, Fiber and Coffee? This is the shot in the arm Austin needed. Good luck to those brave soles for this collaboration. It should be a hit, and can I have a triple Carmel Macchiato? – Stephen8194 One possible place that might soon be driving innovative thinking into companies’ cultural DNA is the soon-to-launch Launchpad Coworking in Austin. Among other things in a long list of innovative offerings being envisioned by Julie Gomoll and her team at Launchpad is the concept of an Innovation Lab, where corporates desperate for creativity can mingle and pollinate with designers, developers, and writers who will be coworking in the space. Elements of a consciously built environment combined with creative individuals doing there things will inspire anybody who chooses to turn up. Add a wee bit of structure and intent to the process and who knows what might happen? – NotAnMBA.com ( E X C E R P T F R O M A B L O G P O S T )

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PRICING LaunchPad Coworking will be the premiere coworking cafe environment, with top-of-the-line design, furnishings, and food. Tentative pricing for LaunchPad Coworking is • 6–12/hour for individual workspaces. Time may be purchased by the hour, on a monthly basis, or as bulk hours that never expire. • 35–90/hour for meeting rooms • 150–200/hour for videoconferencing equipment rental • 3–5/hour for rental of additional ammenities

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One man can be a crucial ingredient on a team, but one man cannot make a team KA R E E M A B D U L- JA B B A R Fo r m e r P r o f e s s i o n a l B a s k e t b a l l P l a y e r

PROFORMA INCOME STATEMENT CAPITAL NEEDED: $1,700,000 EQUITY OFFERED: 37% MINIMUM INVESTMENT: $50,000 Julie Gomoll and members of the LaunchPad Coworking core team have been engaged full time in this venture since spring of 2007. Additionally, Ms. Gomoll has contributed over $600,000 of her own money. Construction is well underway. Opening is scheduled for early 2009. This project is expected to generate enough cash flow to produce a projected annualized rate of return of 40.7% over a 60 month period for Class A limited partners. After that, Class A limited partners will receive distributions representing 37% of cash flow until the partnership terminates. Cash flow will include:

• Licensing of proprietary software to third parties. We have already had significant interest from established firms. • Licensing the LaunchPad Coworking brand to future locations. • The eventual sale of the 800 Brazos location. Additional ownership classes include:

• General Partner: 1% • Class B, Sweat Equity Partners: Julie Gomoll: 30% Tina Rosenzweig: 3.5% Tori Brietling: 3.5% Marie Hwang: 3% Susan Price: 2% • Class C, Founder Limited Partner: 20%

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FINANCING REQUIRED

Contingincies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $44,126 Leasehold setup and buildout costs. . . . . . . . . . . . . . . . . . . . . . $923,600 Intellectual Property development and Branding. . . . . . . $308,750 Co-Working FF&E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $144,525 Café FF&E. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $75,530 Café initial inventory & smallwares . . . . . . . . . . . . . . . . . . . . . . . . . $18,450 Opening Operating Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $275,000 Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,789,981

Reimbursement of buildout costs at completion. . . . . . . . . . . (166,000)

TOTAL FINANCING REQUIRED . . . . . . . . . . . . . . $1,623,981

Percentage of Equity offered . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80% Number of units offered . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 325 Cost Per Unit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $5,000 Projected Payback Period in months. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 Payback Factor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2X Total Capital Payback . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,247,961 Internal Rate of Return. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21%

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Pro Forma Income Statement

Q3-Y2

Q4-Y2

FY-Y2

FY-Y3

FY-Y4

FY-Y5

Q2-Y2

2,386,728 900,900 1,098,000 387,828 280,800 675,051 3,342,579

Q1-Y2

2,300,355 846,846 1,098,000 355,509 257,400 630,048 3,187,803

FY-Y1

2,188,287 810,810 1,065,060 312,417 226,200 585,044 2,999,531

Q4-Y1

Q2-Y1

1,667,654 695,195 724,680 247,779 179,400 564,793 2,411,846

Q3-Y1

Q1-Y1

Pro Forma Cash Flow Years 1-5 ($) 495,800 195,195 230,580 70,025 50,700 146,261 692,761

390,618 166,667 164,700 59,252 42,900 139,511 573,029

442,458 180,180 197,640 64,638 46,800 144,011 633,269

338,778 153,153 131,760 53,865 39,000 135,010 512,788

246,583 202,515 192,048 641,146 2,701,433

825,453 378,378 285,480 161,595 117,000 379,529 1,321,982

173,687 81,081 54,900 37,706 27,300 86,257 287,243

237,099 189,014 182,556 608,669 2,579,133

304,394 135,135 120,780 48,479 35,100 121,509 461,003

108,333 54,054 21,960 32,319 23,400 63,755 195,488

227,980 175,513 175,104 578,597 2,420,934

239,040 108,108 87,840 43,092 31,200 108,008 378,248

Revenue Co-Working Individual space by the hour Individual space from members Meeting room space Video Conferencing Café Total Revenue

219,211 169,438 163,872 552,521 1,859,325

54,803 43,203 40,968 138,974 494,295

731,645

54,803 43,878 40,968 139,649 553,111

54,803 41,853 40,968 137,624 435,405

52,695 32,402 32,184 117,281 260,967

54,803 40,503 40,968 136,274 376,514

52,695 25,877 32,184 110,756 176,487

210,780 113,859 128,736 453,375 868,607

52,695 19,126 32,184 104,005 91,482

52,695 36,453 32,184 121,332 339,671

Operating Expenses Non-Café Café Rent Total Operating Expenses Gross profit

696,368

237,290

645,653

629,973

775,088

225,849

1,008,483

724,015 1,977,418

188,874

959,859

697,057 1,882,076

1,049,277

-

802,717

654,255 1,766,679 66,576

161,413 391,698 54,798

391,698

161,413 332,882 43,020

-

266,305

-

219,193

161,413 273,991

-

228,521

-

172,081

161,413 215,101

36,436

157,493 182,178

20,695

157,493 103,473

145,742

157,493 18,994

82,779

157,493 (66,011)

-

-

Less Salary & benefits expenses Cash Flow Provided by Operations

-

-

Reserve for Equipment Replacement in lieu of depreciation Distibuted Payout to Cash Equity invest

-

-

Payout to Sweat Equity (12%) Payout to J Gomoll (51%)

Totals

221,525

3,480,899

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Wild ducks make a lot of noise, but they also have the sense to benefit from occasionally flying in formation. U N K N OW N Future Coworker

THE TEAM More than any other Texas city, Austin is a high-tech center with a high degree of adoption of web technology and an extremely tech-savvy customer base. The LPC management team is made up of individuals who enjoy a leadership position within the web industry.

CEO: JULIE GOMOLL Julie Gomoll, CEO of LaunchPad Coworking, is a seasoned entrepreneur with proven ability to jumpstart businesses and bring innovative ideas to profitable reality. She has been a leader and a visionary in the fields of new media and community building for over two decades. From her early days as an internet pioneer to her current status as a sought-after independent strategist and consultant, Gomoll has fearlessly adopted and mastered each new wave of media technology. From the desktop publishing revolution of the 80s to today’s expansion into open source community, her leadership and experience have been invaluable assets. In 1987 she started Go Media, Inc. offering the first Mac-based production services in Austin. She transformed Go Media from a one-person operation in her garage into an award-winning web design and development agency. She sold Go Media to Excite, in 1996. As Co-founder, President and Board Member of Austin Free-Net from the late nineties to the early aughts, Gomoll defined new visions and goals for supporting Internet use and education in traditionally under-served markets in Austin, creating a model that is recognized internationally as a blueprint for success in community computing. As Director of Product Development for Excite and Excite@Home, she was responsible for their entire online community strategy, growing what had been a vague notion of needing users to“participate on the site”into the highest traffic-generating suite in Excite’s product line, pioneering protocols and positioning for the then unheard-of applications instant messaging, chat, boards, groups and web-based email. Most recently, as Co-founder and General Manager of Halsoft.com, Inc., she was able to capitalize on her Excite experience to create an innovative, profitable and sus­tainable subscription-based chat community, as well as the successful Halsoft Online Subscription Service and Halsoft Leagues. Indeed, Gomoll’s heart, her passion, is in creating and serving community through innovative strategies, the latest of which is building LaunchPad Coworking, where technology, ideas, and people can meet.“I love what I’ve learned about community and collaboration in my career as an entrepreneur,” she says.“Most importantly, that we’re smarter and stronger when we work together and share knowledge than when we work alone.That applies online and offline.” L A U N C H PA D C O W O R K I N G + C A F E | 35

GENERAL MANAGER: TINA ROSENZWEIG Tina Rosenzweig, General Manager of LaunchPad Coworking comes to the project with extensive coffee shop and restaurant management experience and a passion for excellent customer service. As the General Managers of Jo’s Coffee on South Congress she took a 250 square foot coffee shack and turned it into the epicenter of hip. Through menu and product management, staffing, event planning, and marketing, Tina was responsible for growing Jo’s into a high volume community-based gathering place that ultimately grossed three quarters of a million dollars per year at the end of her seven year tenure — still out of those original 250 square feet. Rosenzweig’s formal education is in environmental studies. Through product selection, recycling, and waste reduction she is able to add more money to the bottom line while bringing environmental integrity to daily business practices. Rosenzweig has lived in Austin for 23 years, and is intimately familiar with the business and social landscapes of the city. Her extensive network is instrumental in creating the community that will be a critical part of the success of LaunchPad Coworking.

WRITER IN RESIDENCE: SPIKE GILLESPIE Spike Gillespie is a journalist, author, blogger, and teacher. She is the critically acclaimed author of four books and countless magazine articles. Her work has appeared in The New York Times Magazine,The New York Times,The Washington Post, Real Simple, GQ, Esquire, Elle, Smithsonian, National Geographic Traveler,The Christian Science Monitor,Texas Monthly,The Dallas Morning News, and other publications. In 2006, Austin Chronicle readers voted her Best Author in Austin. Gillespie began blogging in 1995, before the term “blog” was coined, when Prodigy Services hired her to publish an online journal. She has maintained a strong online presence ever since, with her work appearing at Word.com (the first Internet magazine), Salon.com, Nerve.com, and many other sites. She was a producer for both Prodigy Services and Oxygen.com. As LaunchPad Coworking’s writer in residence, Gillespie is responsible for blogging, marketing and press content, and and and an assortment of other writing duties.

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MARKETING MANAGER: SUSAN PRICE Susan Price is CEO of Firecat Studio, a media communications and marketing consultancy. A serial entrepreneur, published author and nationally recognized user-centered design expert, Price brings cutting-edge marketing and business strategy to LaunchPad Coworking. Price has a long, solid history of developing integrated marketing and communications strategies that measurably meet business goals. She excels at spotting underlying trends and motivations and crafting win-win arrangements between businesses and their customers. She studied media communications and animation at UT Austin. Her early career in print technology and typography led Price naturally into early adoption and mastery of online and interactive communications. Price’s direct experience ranges from business analysis and strategy through information architecture, user experience design and copywriting through product launches. Price and Gomoll have collaborated on several highly successful endeavors, including Austin Free-Net.

USER EXPERIENCE ARCHITECT: TORI BREITLING Tori Breitling, Experience Architect for Launchpad Coworking, brings to the project a long history of both visual design and retail experience. Starting in graphic design in the days of the Mac Plus, her career grew with the boom of desktop publishing. It was during this time that she and Julie Gomoll first began working together, when Gomoll engaged Breitling as a free-lance illustrator at Go Media. Breitling’s increasing computer savvy led her to managing some of the first and later largest computer center operations for Kinko’s stores in Texas and in the Bay Area. While in the Bay area, her formal education in film piqued her interest in CDROM development, which quickly led her to make the transition to working primarily on the web. Upon returning to Austin, Breitling once again worked with Gomoll as Senior Designer for Excite’s communities products. It was this experience in dynamic applications which would define her career in the coming years, as she became more focused on the user experience aspects of web design, and worked on increasingly complicated desktop and web applications for The Cobalt Group, Halsoft, Inc., and HomeAway. Breitling’s long history of working with computers — and working with people working with computers — makes her especially sensitive to the user experience. Her goal is to create interactions that are useful, usable and elegant.

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SENIOR CONSULTANT: MARIE HWANG Marie Hwang, Senior Consultant of LaunchPad Coworking, is a veteran interaction designer with a decade of experience designing enterprise level applications and transactional web sites. She thrives on breaking down complicated problems, which she tackles with simple, streamlined solutions that are readily and easily accessible by all team members and clients. Her keys to success include keen analytical skills, the ability to process and synthesize multiple layers of data, and a gift for logical restructuring. Upon earning a Master’s degree in Human-Computer Interaction at CarnegieMellon University, Hwang went to work for Trilogy Software, where she served four years as a Human Computer Interaction Specialist for the Financial Services Business Unit. In 2003, Hwang joined Expero, Inc as a Senior Consultant where she designed exception­al user experiences for complex, web-based applications. At LaunchPad Coworking, Hwang is working closely with Tori Breitling to create an optimized UI experience that goes beyond ease-of-use and enters the realm of loveable, efficient, and highly effective — in short: delightful. Her continuing goal is provide seamless, intuitive interfaces so that members can spend their time working, not navigating.

DEVELOPMENT TEAM: INTEGRAL CONCEPTS Integral Concepts is led by a small core of software development professionals with decades of experience in the Houston,Texas market.We have a wealth of experience in the oil & gas and trading industries, as well as notable experience in consumer software, manufacturing, government and space industries. One of the fundamental driving principles of Integral Concepts is “less is more.” No matter what aspect of software development, when complexity is rising, we re-evaluate our understanding of the problem space. In the long run, the customer is usually better served by refining the understanding of the problem than by succeeding in delivering cumbersome special cases.

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ARCHITECT: MURRAY LEGGE Murray Legge, a licensed architect, is a graduate of the Cooper Union School of Architecture in New York City. His work ranges from architecture and landscape design to public art. Legge has won many competitions and design honors including the 2006 AIA Austin Young Architectural Professional Award and the prestigious Lyceum Fellowship. For the past 10 years, he has been practicing as design and project architect with LZT Architects, Inc., in Austin,TX. Legge’s work at LZTA includes the design and management of several multi-use sustainable urban buildings including Austin Resource Center for the Homeless (ARCH) and the Donald Haynes Performing Arts Center.The recently completed ARCH project was awarded a National AIA award for green building and has been the subject of several articles and seminars.The Austin American Statesman’s architecture critic called the building “…a model of public architecture.” Legge’s work has appeared in Architectural Record,Art in America,Texas Architect, and The Journal of Architectural Education and he has been profiled in the Austin American-Statesman and Houston Chronicle. Legge is also lecturer at the University of Texas at Austin. He cofounded the multi-disciplinary group, Legge Lewis Legge, based in Austin and New York, which focuses on large-scale public art installations. Legge Lewis Legge was the recipient of a 2006 Texas Society of Architects design award for Cup City, a temporary interactive lounge, honorable mention in the international design competition for the flight 93 memorial and finalist in the Boston Logan Airport 9/11 memorial competition.

DESIGN TEAM: EM DASH LLC Design Director ERIN MAYES has worked as an art director and designer for over 20 years. She founded Em Dash LLC, a graphic design firm in Austin,Texas in 2006. Her clients include Denison University, Society of Illustrators, UT Press, Design for Use,Texas Monthly Custom Publishing, and Random House. Erin taught editorial design at the School of Visual Arts in New York from 1999-2001, and now teaches advanced visual design at the University of Texas at Austin. Senior Designer KATE ILTIS joined Em Dash this year after leaving her post at Outside as Deputy Art Director.Their work has received awards from the American Institute of Graphic Arts, the Society of Publication Designers, the Type Directors Club, Print, and American Illustration.. Em Dash LLC is responsible for managing LaunchPad Coworking’s brand identity. Working closely with the partners and the architect they design the integrated graphic system that communicates LaunchPad Coworking brand’s personality.That system includes everything from signage, to uniforms, collateral and packaging. L A U N C H PA D C O W O R K I N G + C A F E | 39