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Volume:
1,452,870

Value Traded:
L$1,472,283.56

View Prospectus

General Details

Company: Apez Corp (APZ)
Outstanding Shares: 23,749,912
Company Website: http://www.apez.biz

Board of Directors

Chief Executive Officer: Cenji Neutra
Chief Financial Officer: Kavai Onizuka
Chief Administrative Officer: Splendor Neutra
Chief Marketing Officer: Jon Desmoulins
Executive Director: Sato Meiji
Chief Creative Director: Skimi Mission

Prospectus

CEO's Real Life Name: David Jung
CEO's Real Life Location: USA

Cash on Hand: L$12,000,000.00
Land Owned: 65,536m2
Land Value: L$15.00/m2
Net Tangible Assets: L$12,983,040.00

Monthly Income: L$1,200,000.00
Monthly Expenses: L$320,000.00

Chairman's Letter

Apez Corp is a real corporation with a real vision. As a real-life corporation registered in the British Virgin Islands, but currently operating from the US, Apez has been a profitable operation within Second Life since 2005. Our long term goal is to build on the infrastructure put in place by Linden Labs and the Open Source virtual worlds community to help improve the lives - real lives, virtual lives, Second Lives - of everyone. Our current focus has been to provide services in Second Life that lubricate the wheels of commerce for businesses and consumers alike. As our tag line says - "We make your Second Life easier" - and we mean it.

Apez has big plans for the introduction of several new service offerings and strengthening of the banking, vending and lease services we already offer (detailed below). We plan to diversify our offerings and dominate several markets, becoming a 'one-stop-shop' for consumers and businesses in SL. Although revealing all our plans would compromise our competitive advantage, one of the smaller services we plan to launch in the near-term is Apez.promote - an advertising marketplace.

However, our plans are bigger than our means - which is why we need your help. Our server cluster infrastructure is straining to keep pace with our accelerating rate of growth and we don't have the resources to develop all of our services at the pace we wish to expand. By investing in Apez you'll help us meet those goals and push forward more rapidly into multiple markets - and you'll be playing a significant part in the future of Apez and SL!

We know we have the personnel and experience to make our plan a success. As the CEO and CTO, I have a strong background in developing the kinds of technological infrastructure Apez needs - including degrees in computer science, software engineering and a PhD in Artificial Intelligence and Behaviour-Based systems. More recently, I've worked for the US government as a research scientist on the world's most powerful unclassified supercomputer. None of that has been as exciting as having the opportunity to play a small part in the evolution of human society into the online realm - a realm that ultimately will empower us as a species and touch everyone and everything on the planet. Among the Apez staff we also have other PhDs, professionals and experts in finance, marketing, public relations, design, cybersecurity, and software development.

As a company, we believe in corporate accountability. We don't subscribe to the 'person-hood' model of corporations in place in many Western countries, whereby a corporation has many of the rights of a person, but few of the responsibilities. A corporation can break the law, but you can't put a corporation in prison. We believe that a company is simply a group of cooperating people, and hence its employees (and shareholders) should behave as responsible, law-abiding and ethically responsible individuals. Effective cooperation is the key to successful competition in general, hence also specifically in the marketplace. Apez Corp is a proud member of the SL Business Bureau.

So, please, join with us and help make all our Second Lives easier!


Business Overview

Apez's current operations are divided into business units based on our service offerings. The main services we currently offer are known as Apez.bank, Apez.vend and Apez.lease.

The banking unit is one of the largest banks in SL and also integrates tightly with our other services. Over the last 12 months approximately L$1.2Billion in transactions were processed. It offers our ~5800 customers features including multiple accounts, transfers between customer accounts and to avatars in-world, group payments, a scheduled payment system for recurring payments, such a billing, tier payment, payroll etc., an exchange service for converting L$ into foreign currencies (the operation of which is handled by a subsidiary, Apez Currency Exchange, previously listed on WSE as ACE). The bank service also has an extensive network of 160 ATMs around the grid, although most customers use our personal iDeposit device, which is also commonly used to collect tier payments, donations etc.
We aim for piece-of-mind - our CEO's RL identity is not secret from our employees and the public, as is the case for some other SL banks, nor do we purport deposits to be in an unnamed mysterious investment that somehow earns over 50% APR.
Our customers know they can trust their funds with Apez.bank and can trust payments from other Apez customers thanks to our industry leading security technology, which monitors transactions patterns, assesses each avatar for risk based on other multiple criteria, including checks against LL's risk API, and other proprietary mechanisms.

The Apez.vend service is a grid-wide networked vendor system comprised of over 20,000 vendor units - the iVend, one of SL's most popular networked vendors - all integrated with our back-end server cluster. Unlike other networked vendor systems in SL, the Apez.vend network completely integrates the vendors and item-servers of all merchants into a seamless network - allowing anyone to sell the products of any other merchant (subject to their access controls), with fine control of sales processing (revenue assignment, tiered sales commissions and other features). The web-based management interface allows merchants to see their inventory, products, sales and vendors at a glance, with map displays allowing teleport directly to in-world vendor locations. The in-world network can operate without the back-end cluster if necessary, for robustness. The vend network is currently the fastest growing sales medium in SL, with about 97,000 items representing almost 35,000 products listed by thousands of merchants. The Apez brand is known to over 60,000 buyers who have utilized our network.
The service earns revenue through commissions levied on inter-vendor and free-vendor sales.

One of our pioneering services is Apez.lease. By providing land owners with a device (Auto-Lease) that tracks leases on in-world spaces, such as parcels, stores, homes etc., that is integrated with a web-based management interface, we allow owners to easily keep track of their costs and tenants. The Auto-Lease is the arguably the most popular lease/rental unit in SL, with over 8,000 currently rezzed in-world in almost 2,000 separate facilities. Our site also provides a marketplace where users can search for vacant locations advertised by space owners, rated by tenants. Tenants can also extend leases online and provide information about their store, home etc. Revenue comes from commissions charged by one model of the Auto-Lease and from search listing fees.


Business Strategy

Our strategy is four-fold. Firstly, we concentrate on sustainable businesses models - such as commissions on ongoing activities, such as sales and leasing, for example. We plan on building systems that will earn revenue over the long term - infrastructure systems that are also sophisticated enough that they are a significant assets in themselves and represent a high barrier to entry into the market. Contrast this with companies that deal in real-estate development, where land prices and tier can fall dramatically overnight when LL decides to roll-out more sims (or in the future when anyone can host sims) and where there is no barrier to market entry save the price of a sim (anyone can buy land, rezz a few roads and trees and divide it up for sale to make a quick buck, but it isn't sustainable).

Secondly - integration. Our services do not stand alone. Instead, we aim for each service offering to build upon, hence strengthening, the others.

Thirdly, we aim to provide a comprehensive set of services. Our goal is for Apez to become a 'one-stop-shop' for consumers and businesses alike. If we simply offer everything the customer needs, it'll be an easy decision (a 'no-brainer') for them choose Apez over the competition. We also intend to forge cooperative alliances with strategic partners where appropriate to cover the market space - we believe in making allies, not enemies.

Finally, quality. With an injection of venture capital and the revenue generated going forward, we'll be in a position to expend the necessary resources to stay one-step-ahead of any competition - ensuring that Apez products and services are simply the best in their class.


Business Strengths

Our main business strengths are in our highly experienced and professional personnel and our extensive existing server and software infrastructure and in-world product lines. We've demonstrated innovation in the past and will continue to do so. The Apez.iVend is still the only inter-networked and web-enabled vending system on the market. The Auto-Lease is also the leading (perhaps only) web managed lease/rental system available. In building a complex server-side infrastructure to manage so many in-world devices while presenting a simple face to the user, we've learned many valuable lessons; lessons that will take time for any new competitors to grapple with as we've successfully done in order to come where we stand today.

Since the Apez brand appears on vendors and lease units across the grid, it is a brand familiar to many people, even if they have never visited our site. With the introduction of many more Apez branded devices across the grid, we envision the brand starting to 'seep into the psyche' of residents, becomes associated with consumer and business services, such that it reaches a critical mass with individuals prompting them to investigate our offerings for themselves. We will, of course, engage standard publicity mediums, such as web, in-world and magazine advertising. The introduction and adoption of the the Apez.prompte service will also place us in an advantageous position for advertising our own services.

As we've positioned our business to provide for the needs of other SL businesses, Apez has become a hub of business activity. With regular contact from other in-world businesses comes new ideas and opportunities for collaborations and alliances, a strategic strength in itself.


Market Overview

Apez.vend: The vend service employs the only inter-networked and web managed vendor system available in SL. However, there are other networked vendor systems - notably JEVN. The JEVN vendors have a larger market share because they are and older product - having already established wide adoption before the iVend was created. However, many customers are switching from JEVN vendors to Apez vendors. The JEVN vendors still have some models for which Apez hasn't yet released an equivalent - such as so-called 'catalogue vendors'. Part of the capital raised will be used for the development of a complete line of products, so that there will be nothing holding merchants back from switching. There are also two other minor networked vendor brands on the market, one of which is newly web-enabled, but has a long way to go before approaching the feature set of the vend service.

Apez.lease: There are many lease/rent devices available in SL, all with very similar functionality. The Auto-Lease is the only web managed one of note, although HippoTech plans to launch a web interface for their existing rental unit this year. The Apez.lease service still has the greater market share and we'll be aggressively expanding the capabilities with the capital we raise.

Apez.bank: Our banking features are more sophisticated than any other bank in SL. Our main weakness is that we do not currently offer interest, as we don't yet offer loans or investments (and we run a legitimate business that doesn't use deposits to pay account interest, or gamble them in high-risk in-world endeavours). There are all features that are planed, in addition to more banking services generally useful to SL business operations.


Use of Capital

The capital raised will be used in the following ways (in order of largest to smallest expenditure)

1) Development and implementation of server-side and web-front code for new Apez services
2) Transition of existing server cluster architecture into a new scalable, lower-cost and more reliable system
3) Design and implementation of new and enhanced in-world devices in support of existing and new services
4) Publicity (advertising in print, radio and other media)
5) Establishment of an Apez retail presence across the grid.


Risk Factors

- The usual risk factors associated with business in SL apply (sudden devaluation of the L$, LL declaring bankruptcy, etc.). In the event that SL starts to decline, which we think is unlikely, Apez will explore alternative virtual spaces or seek to create an alternative ourselves. We believe that SL is already bigger than LL. Although LL currently holds a monopoly on sim hosting, they've stated their intention to open sim code to the public (and even if they don't, compatible alternatives are already under development). If the L$ crashes, Apez will also offer services in several other currencies.

- A better funded start-up competitor may attempt to develop services similar to Apez. Fortunately, the complex infrastructure we have in place isn't reproducible with time and money alone - it also requires gaining significant experience in operating a system of this nature - experience that money cannot buy.

- Cancellation of key avatar accounts by Linden Labs. Such an occurrence would be disruptive to Apez Corp operations, but wouldn't disable them at all. All of our devices are present in multiple avatar inventories and, since the scripts are the primary assets, those are backed-up externally to SL. The banking system currently has support for multiple 'funds-holder' avatars, so the loss of one account would not be crippling. However, Apez staff have a good relationship with some LL employees and LL is aware of our operations and their nature.


Management

Cenji Neutra: Responsible for overall operations of the company and software engineering lead
Kavai Onizuka: Financial operations and decision making, including currency exchange (ACE)
Splendor Neutra: Responsible for overseeing administrative functions of the company and its staff
Jon Desmoulins: Marketing oversight
Skimi Mission: Creative Design and Architecture (structures, branding, products)
Sato Meiji: Executive decision support





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