Euro and RSA Patented Facial Recognition ID Smart Card System

Our product, the FAD Smart card, will be used to add data and store it. We will then process an IT verification certainty service to Sports on an ongoing basis. A pilot project is to commence in Jan 2012.

We aim to produce in the short term 30 000 smart cards to selected schools and run a test on time to produce the card and set up the management of the people providing the service. In the long run we aim to fulfil a 5 year contract with the government to register and monitor all 1 million athletes in SA.

The cash payback period for the mini project is about 12 months. Capital needed for the project is about R7.2million and ROI after tax is about R2 million.

This business idea has a long development history. It was conceptualised in 1999 at a University and research and development were done until 2010. It was mainly supported by a grant funding of R1.4million from the Department of Trade and Industry (IDC) and Microsoft for software development. We have accreditation from the University of the Western Cape, Police, Proudly South Africa, SA Soccer, Sports and Recreation, Social Services. Our product is unique and we have no competition with our facial recognition method. The system will be able to trace a file using real/actual facial and dental measurements unique to each individual. This measurements are encrypted into a smart card together with other biographical information.

A great opportunity for an investor is to become a partner and become part of the initial growth. The product and company fit into the criteria for grant funding and therefore we are considering applying for government grants and funding which will raise our capital by a 100% for seed capital. The company is 100% black owned but the profile is still not right because it only has one owner (myself). Shareholding is the next step but the company needs cash flow! The private investor has an opportunity to come in at R20 mill at 30% shares at current value set at R180- 350 mill as established by attorneys once the contract starts and patent rights and royalties. This all looks good if one looks at the financial forecast where end profits are indicated to be 65%.

The Smart cards technology is needed in our daily lives and we have had talks with Home Affairs for future smart ID cards.

Our product has only entered or gone to market in Sept 2010 when we have completed our patent registrations in Europe and RSA as well as our software and card system.

There are two options for funding: The company has a vision to provide about 500 new jobs in the first 2 years, fitting into the government plan and we will launch a smaller project now in 2012 of a budget already completed and submitted to government of R7.2 million to produce 30 000 cards at about R350 per client which gives us a gross income of R10.5 million. Our cost per card is about R40-60. The aim of this project is to establish a good future management platform for other bigger projects.

The main project being sports athletes of 1million cards.

Funding for the main project would be R96 million over 5 years creating about 1000 jobs nationally and projected income of R350 million.

No competition, the product is patented in Europe and RSA.

The company is registered in 2007 as a Pty Ltd and I am the CEO and sole owner and the holder of both patents. I have put in a capital injection and scientific expertise and dental/forensic research of about R5 million over 10 years and other funding sources were R1.4million from the Department of Trade and Industry and Microsoft. Current assets, software, hardware, a concept implementation are in the company's possession and there are no current debts other than normal monthly running costs, auditing fees, taxation, tax clearance, patent yearly registration, salary accumulations.We need a financial partner to drive the process to contract agreements and finalisation with government departments.

There are two income streams, the first is the smaller project of R7.2 million and the second is 1 million cards for the bigger project and the budget for that is R96 million.Financing will be used to structure salaries for at least a year as well as capital expenditure which will mainly consist of computer hardware.The core funding will come from the Department of Trade and Industry with a R7.2million application for venture capital of 30% but can be paid back.Therefore the company will have R7.2million paid back during the project milestones on past expenditure.The projected profit from the mini project is R2million.Any cash injection from a private investor for the initial kick start would yield substantial growth after 12 months.R2.8million will secure our salaries and capital expenditure for at least 6 months and total budget over 12 months is R7.2million for a maximum investment.The return on investment is 20% shares within the company and current value is set at R180 - 222million taking projections in mind with R5million already injected over a 10year period. An investor is needed to correct our cash flow situation as annual Euro patent registration,tax registration and salaries and backlog make up for about R400 000 already.