Ddh wl pitch deck 2019-05-03

1
Individual Milk in Interactive Packages
Breaks Value Chain in Milk Production
Andrey Kuteynikov, CEO
Direct Dairy Holding b.v.
May 3, 2019

Pitch structure
1. Problem
2. Solution
3. Technology
4. Farm Economics
5. The Product
6. Business Model
7. Market
8. Competition
9. Business Projections
10. Team
11. Current Stage
12. Funding Requirements
+7 925 158 0238 RU +31 6 5555 8814 NL
ak@directdairy.nl www.directdairy.nl
2

Unhappy Actors of European Milk Market
Consumers
Milk = a commodity-type daily item with indifferent taste,
unknown origin, and no emotional value
Retailers
Milk = cheap bulky product sold at a loss to attract
consumers to stores
Industrial dairies
Milk = cheap by-product in production of higher value items
Farmers
Process <1,5 percent of their raw milk at farms
Sell raw milk to dairies at or below cost
+7 925 158 0238 RU +31 6 5555 8814 NL
3

Problem #1:
Milk is a boring commodity 
+7 925 158 0238 RU +31 6 5555 8814 NL
4

Problem #2:
Industrial Milk Is NOT FRESH!
+7 925 158 0238 RU +31 6 5555 8814 NL
5

The Solution
+7 925 158 0238 RU +31 6 5555 8814 NL
6
Consumers appreciate products that are:
• Fresh
• Local
• Natural
• With known origin & emotional story
Milk should become
emotional artisan product 
And DirectDairy™ makes it to reality!

Cow-to-Package Milk Flow 3.0
by DirectDairy™
+7 925 158 0238 RU +31 6 5555 8814 NL
7

On-farm mini-dairy
• Integrated milking + pasteurization + filling + sorting
• Fully automatic 24/7 from cow to cold storage shelf
• Standard building 18.5 x 7.5 x 4.5 m
• Compatible with 1-2 milking robots
• Cold storage for production volume of up to 48 hours
• Fermented liquid products (yogurt, etc.) as an option
+7 925 158 0238 RU +31 6 5555 8814 NL
8

+7 925 158 0238 RU +31 6 5555 8814 NL
9
• Three-cups (720 ml) stand-up pouch with screw-off cap
• Co-branded design: Wingy Lindy® brand and farm brand
• Cow ID & exact milking time on each package
• Digital interactivity by cow-specific QR triggers
• Customizable down to every business client and household
Milk Package Basics

The Label
Unique for each
milking
Full story of milk
origin
Interactive QR
code
Milk sortable by
four variables
ak@directdairy.nl +7 925 158 0238 RU +31 6 5555 8814 NL
www.directdairy.nl
10

“Blue ocean” for Wingy Lindy™ milk
+7 925 158 0238 RU +31 6 5555 8814 NL
11
0
2
4
6
8
10
12
Wingy Lindy™ milk Industrial milk Farm packaged milk

DirectDairy™ Farm Economics
+7 925 158 0238 RU +31 6 5555 8814 NL
12
Added farm cost per one 720 ml package
(at full Direct Dairy™ R2 system capacity)
€0,37
Full farm-gate cost per 720 ml package
€0,64
Break-even point (packages/day)
≈650

Break-Even Point & Earnings Calculator
at www.directdairy.nl
+7 925 158 0238 RU +31 6 5555 8814 NL
13

Dutch pasteurized A1 milk: consumer price decomposition
Traditional (#1, 1L) and Wingy Lindy™ (#2-4, 720 ml)
+7 925 158 0238 RU +31 6 5555 8814 NL
14
Industrial milk, 1L Wingy Lindy™ milk, 720 ml
Industrial milk Sale to POS Vending Subscription
Raw milk cost € 0.38 € 0.27 € 0.27 € 0.27
Processing & packaging € 0.50 € 0.37 € 0.37 € 0.37
Logistics farm to POS € 0.13 € 0.11 € 0.15 € 0.60
Retail gross margin € 0.14 € 0.30 € 0.00 € 0.00
Farm gross margin € 0.04 € 0.14 € 0.30 € 0.23
VAT, 9% € 0.11 € 0.11 € 0.10 € 0.13
Consumer price € 1.30 € 1.30 € 1.19 € 1.60
€ 0.00
€ 0.20
€ 0.40
€ 0.60
€ 0.80
€ 1.00
€ 1.20
€ 1.40
€ 1.60
€ 1.80
Industrial
milk
Sale to POS Vending Subscription
VAT, 9%
Farm gross margin
Retail gross margin
Logistics farm to POS
Processing & packaging
Raw milk cost

Dutch pasteurized A2 milk: consumer price decomposition
Traditional (#1, 1L) and Wingy Lindy™ (#2-4, 720 ml)
+7 925 158 0238 RU +31 6 5555 8814 NL
15
Industrial milk, 1L Wingy Lindy™ milk, 720 ml
Raw milk cost € 0.38 € 0.27 € 0.27 € 0.27
Processing & packaging € 0.55 € 0.37 € 0.37 € 0.37
Logistics farm to POS € 0.13 € 0.11 € 0.15 € 0.60
Retail gross margin € 0.35 € 0.45 € 0.00 € 0.00
Farm gross margin € 0.05 € 0.26 € 0.49 € 0.32
VAT, 9% € 0.13 € 0.13 € 0.12 € 0.14
Consumer price € 1.59 € 1.59 € 1.40 € 1.70
€ 0.00
€ 0.20
€ 0.40
€ 0.60
€ 0.80
€ 1.00
€ 1.20
€ 1.40
€ 1.60
€ 1.80
VAT, 9%
Farm gross margin
Retail gross margin
Logistics farm to POS
Processing & packaging
Raw milk cost

Why will consumers buy & pay a
premium?
Fun to buy and drink:   
• Direct processing from cow to package =
unbeatable milk quality
• 100% natural, fresh, and local
• Fully transparent origin: traceable to specific
milking session of specific cow
• Non-mixed = unique flavor in each package
• Interactive package with full cow & farm profiles
+7 925 158 0238 RU +31 6 5555 8814 NL
16

Basic Product Matrix
projected consumer & wholesale prices (720 ml
packs) and unit sales weights in the Netherlands
Natural Organic
A1 €1.35
€0.95 70%
€1.79
€1.19 10%
A2 €1.79
€1.15 15%
€2.29
€1.49 5%
+7 925 158 0238 RU +31 6 5555 8814 NL
17

Business Model: Dairy as a Service
+7 925 158 0238 RU +31 6 5555 8814 NL
18
DirectDairy™ earns on milk, not on
hardware!
We are as interested in maximizing packaged milk
sales by our fellow farmers as farmers themselves
Instruments to reach the goal:
• Strong branding: DirectDairy’s + farmers’ brands
• Active promotion of co-branded milk to local
consumers
• Distribution support

Dairy as a Service: Details
• Umbrella brand for different farms and markets
• Focused brand promotion to local consumers
• €60K = license price per farm
• €169K to €219K = hardware price for R1 and R2
models (operational with one or two milking
robots)
• €90K-100K = building and installation cost
• Royalties: €990 per milking robot/month
€0,16 on each pack of milk
+7 925 158 0238 RU +31 6 5555 8814 NL
19

Collaborative synergy
+7 925 158 0238 RU +31 6 5555 8814 NL
20

Market split, Netherlands
• Potential available market ≈
18 000 dairy farms
• Total addressable market
3959 farms (2017) with
milking robots (AMS)
• Serviceable available market
≈ 400-500 farms with two+
AMS in close proximity to
consumption areas
• Serviceable & obtainable
market ≈ 60 dairy farms with
two+ milking robots
+7 925 158 0238 RU +31 6 5555 8814 NL
21
SAM
SOM
TAM
PAM

Market size (EU)
30,4B liters of drinking milk
consumed annually
≈20K farms with
≈30K AMS
With 2M+
cows
+7 925 158 0238 RU +31 6 5555 8814 NL
22

Competition landscape
Processing options for farmers
• Industrial dairies (process 98.5% of raw milk)
• On-farm processing of mixed milk (primarily into
fermented artisan dairy products)
• On-farm processing of individual milk as direct
competitive option (see next slide)
Wingy Lindy™ milk will be positioned
against industrial milk
+7 925 158 0238 RU +31 6 5555 8814 NL
23

Competition: technologies with declared
individual milk processing
+7 925 158 0238 RU +31 6 5555 8814 NL
24
Function Orbiter™ by Lely TOP BV Direct Dairy™
Compatible with AMS, # of linked
robots and brand
2-4, Lely robots 1, (?) 1-2, any robot brand
Test installations, as of 01.04.19 + - +
Commercial installations, as of
01.04.19
- - -
Individual milk pasteurization
Declared but
unlikely + +
Milk filling mode Manual Automatic Automatic
Milk container type
800 ml plastic
bottles
800 (?) ml plastic
bottles
720 ml stand-up pouches
with pre-sealed spouts
Full feeder capacity, minutes 5-15 30-60 500-700
Labeling Manual Automatic Automatic
Sorting Manual Manual Automatic
Full capital cost to farm ≈ €1M* ≥ €500K* €320K - €390K
Labor hours per 24-hour shift min 72 min 12 <1
Retail price per package €1,69 NA NA
Interactive packages - - +
Marketing support to individual milk - - +
* Just one unconfirmed data source

Expansion plan
2017-2022, end of each period
+7 925 158 0238 RU +31 6 5555 8814 NL
25
Pre-launch Business launch (Phases 3-4) Expansion (Phase 5)
2017-2Q 2019 Operational year #1
Operation
al yr #2
Operation
al yr #3
3Q
2019
4Q
2019
1Q
2020
2Q
2020
Presence in # of national markets 1 1 1 2 2 4 5
Number of operational farms - 1 1 2 5 39 89
Milk sales, 000 packages of 720 ml, full-
capacity farms only 203 203 8823 50301
Pre-launch Business launch (Phases 3-4) Expansion (Phase 5)
2017-2Q 2019 Operational year #1
Operation
al yr #2
Operation
al yr #3
3Q
2019
4Q
2019
1Q
2020
2Q
2020
Presence in # of national markets 1 1 1 2 2 4 5
Number of operational farms - 1 1 2 5 39 89
Milk sales, 000 packages of 720 ml, full-
capacity farms only 203 203 8823 50301

Cash Flow & Sales Projections
+7 925 158 0238 RU +31 6 5555 8814 NL
26
Pre-launch Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12
Sales, thousand Euro 0 202 99 445 1,029 1,833 2,353 3,175 4,060 5,045 6,083 7,553 8,094
Cash Flow, thousand Euro -229 -12 -129 -7 138 421 618 857 1,202 1,581 2,001 2,531 3,213
Annual sales, thousand Euro
Annual cashflow, thousand € -11 3,097 9,325
Operational year #1 Operational year #2 Operational year #3
1,872 11,421 26,775
-2,000
0
2,000
4,000
6,000
8,000
10,000
12,000
Cash Flow, thousand Euro Sales, thousand Euro

Income source dynamics (thousands EUR)
and weight in total sales
+7 925 158 0238 RU +31 6 5555 8814 NL
27
Year #1 Year #2 Year #3
Sale of licenses 720 2520 3240
Sale of hardware 992 5949 8551
Royalties on pasteurizers 21 257 1018
Royalties on milk produced 51 1070 6813
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Year #1 Year #2 Year #3
Royalties on milk produced
Royalties on pasteurizers
Sale of hardware
Sale of licenses

Projected P&L statement
2017-2Q 2019, Euro
+7 925 158 0238 RU +31 6 5555 8814 NL
28
1Q - 4Q 2018 1-2Q 2019 Total, 2018-2Q 2019
Income 0 472,758 472,758
Cost 296,860 449,650 746,510
Direct Dairy™ hardware development & production 166,100 221,400 387,500
IP development 14,000 53,000 67,000
Marketing and Sales 12,000 67,570 79,570
Other cost 104,760 107,680 212,440
Capital 310,000 40,000 350,000
Invested by founder 310,000 40,000 350,000
Outside investment 0 0 0
Revenues for the period 0 472,758 472,758
Balance, end of period 13,140 76,248 89,388

The Team
+7 925 158 0238 RU +31 6 5555 8814 NL
29

Current stage, May 3, 2019
+7 925 158 0238 RU +31 6 5555 8814 NL
30
• R&D for pilot DirectDairy™ system finished
• Technical field tests of the first fully-operational
system completed
• 100% positive reaction from Dutch & UK farmers;
pre-order collection in progress; 26 farmers in
sales funnel;
• Pilot commercial Dutch farmer selected
• Patent application filed, first positive feedback
received. Trademarks registered in Benelux.
• Adaptive mobile website with cow and farm
cloud database is fully-operational

Budgeting options for 2019-2020
+7 925 158 0238 RU +31 6 5555 8814 NL
31

Beyond organic growth:
potential investment rounds v. 1
+7 925 158 0238 RU +31 6 5555 8814 NL
32

Next 20 years
The basics
• Milk remains essential element of daily diet
• Consumers want to know origin of their food
• Consumers want natural & local food
+7 925 158 0238 RU +31 6 5555 8814 NL
33

34
+7 925 158 0238 RU +31 6 5555 8814 NL

Ddh wl pitch deck 2019-05-03

Recommandé

Recommandé

Contenu connexe

Tendances

Tendances (20)

Similaire à Ddh wl pitch deck 2019-05-03

Similaire à Ddh wl pitch deck 2019-05-03 (20)

Dernier

Dernier (19)

Ddh wl pitch deck 2019-05-03

Notes de l'éditeur