Hardware companies have traditionally low margins, high competition, and long development lead times. This talk will discuss some of the opportunities that may augment business opportunities for wearables including recurring high margin revenues, razor blade business models, virtual goods, creating natural virality, and the notion of modularity. Augmented World Expo (AWE) is back for its seventh year in our largest conference and expo featuring technologies giving us superpowers: augmented reality (AR), virtual reality (VR) and wearable tech. Join over 4,000 attendees from all over the world including a mix of CEOs, CTOs, designers, developers, creative agencies, futurists, analysts, investors, and top press in a fantastic opportunity to learn, inspire, partner, and experience first hand the most exciting industry of our times. See more at http://AugmentedWorldExpo.com

1. @TheNexBand www.thenexband.com
New Business Models
for Wearables

2. Background
@TheNexBand www.thenexband.com

3. BUSINESS MODEL
Traditional Physical Goods
Mobile Applications
Virtual Goods
NET MARGINS
<10% Net Margins
30-35% Net Margins
High margins but <10%
recover investment
THE HOLY GRAIL - HIGH MARGIN, RECURRING REVENUE
What we looked for in terms
of business models
@TheNexBand www.thenexband.com

4. The beauty of
Razor Blade and
Subscription
Models
@TheNexBand www.thenexband.com

5. @TheNexBand www.thenexband.com

6. What were some of the
innovative business
models?
PAY PER
DOWNLOAD
IN-APP
ADVERTISING
SUBSCRIPTION
MODELS
FREEMIUM
@TheNexBand www.thenexband.com

7. Gaming
$3 BILLION AND HUNDREDS OF MILLIONS TOYS SOLD
@TheNexBand www.thenexband.com

8. Jewelry
REVENUES OF $2.4 BILLION IN 2015
@TheNexBand www.thenexband.com

9. Collectibility — The one
consistent mechanic
throughout time
@TheNexBand www.thenexband.com

10. But how does this translate in the
wearable world?
@TheNexBand www.thenexband.com

11. Wearables have high abandonment rates
after just a few months of use
No recurring revenues
Locked into single function
Most engaged demo is ignored
Gen Z is largely ignored and represents
26% (67M) of the population
Low Margins.
The Problem
@TheNexBand www.thenexband.com

12. Underserved
Hyper Social
Market
Gen-Z
Underserved
@TheNexBand www.thenexband.com

13. Modular, hackable, socially designed
for Gen Z
Five touch-sensitive programmable
buttons called Mods™
High margin, recurring revenue
@TheNexBand www.thenexband.com
The Opportunity — Nex

14. Nex is Engaging
Mods are a living piece of hardware that
can be shared and associated with
content and permissions
Videos, games, photos, music — The
“mix tape” for the new generation
Customize the appearance of your Nex
Share content and hacks
Full control over privacy
PLAY MUSIC
CHAT
GAMING
CONTROL IOT
SHARE CONTENT
@TheNexBand www.thenexband.com

15. Nex is Hackable
Create an infinite amount of “Hacks” in seconds
Mods act as five shortcut buttons on your wrist
Partnered with IFTTT
You don’t need to be a developer
You don’t need to rely on 3rd party apps
@TheNexBand www.thenexband.com

16. Nex is Gaming
CHARACTER WEAPON POWER-UP
Like Skylanders on
your wrist — but alive
in the cloud
@TheNexBand www.thenexband.com

17. The “Razor blade”
Business Model
Recurring High Margins
Highly Licensable
Flexible API/SDK
Naturally Viral and Collectible
Nex - $129
Mods - $12.99
@TheNexBand www.thenexband.com

18. Avoid the race to the bottom…
@TheNexBand www.thenexband.com

19. The Nex Band
thenexband.comThe world’s first modular smart band
Adam Adelman
Founder
adam@mightycast.com
$10 OFF WITH
COUPON CODE
AWE2016