# How Pivt Pay makes money, in years one, three and five *An investor section for a seed round. The prices and rates here are the ones running in the live product (`server/lib/plans.js`, shared with PIVT). Every number traces back either to that pricing or to an input we name. Anything we had to guess is labeled ASSUMPTION so you know what to dig into.* --- ## 0. What we assumed | Input | What we used | |---|---| | Where we are | No revenue yet. The payments and fundraising engine is built (Stripe, installments, chasing, payouts) and we are signing our first clubs by hand. Every forward number is an ASSUMPTION. | | The raise | A $2.5M seed (ASSUMPTION), split 55% product, 30% getting in front of clubs, 15% operations and runway. Swap in the real round. | | The market | US competitive and travel clubs: soccer, volleyball, basketball, baseball and softball. About 60,000 programs (ASSUMPTION), plus the NIL pool those clubs feed. | | How we sell | The founders sell to club directors, where one director can mean 6 to 40 teams. Families spread it. A fee calculator pulls people in. We move the first clubs over for free. | | Cost to win and keep | All ASSUMPTION until the first clubs report back. See section 5. | > The short version. The club product is the cheap way in: a subscription, dues, and a cut of > fundraising. PIVT is the part that pays off for years: athletes, brands, agents and coaches on > subscriptions, plus a cut of every NIL deal. The same club we paid to win feeds both sides, so > the cut keeps growing on a cost we already covered. --- ## 1. Why this works - **Four ways to earn, two of them a cut of money moving.** Subscriptions give a steady floor. The cut on deals, fundraising and dues grows with the money, and it costs nothing extra to win because it rides on clubs we already have. That is durability and margin, not just growth. - **The club seeds the marketplace for free.** Every paying club brings 150 to 300 families. Every family can become a PIVT athlete. Every athlete is supply that brands and agents pay to reach. We buy that supply at dues prices, not at marketplace prices. - **Two products, one login, one bill.** A club admin who lands on dues is one tap from a PIVT team. An athlete who sets up a free profile is one tap from a paid plan. That lifts the lifetime value with almost no extra cost to acquire, which is the most important lever here. - **We are cheaper than everyone.** Fundraising runs 16 down to 0, under Snap!. Dues stay under TeamSnap. The NIL cut runs 20 down to 4, under the usual agency rates. We win the line item and still keep a cut. - **A light balance sheet.** Money settles into the club's own Stripe account. We never hold it, so we skip the money transmitter licensing that usually slows a payments business down. - **A built in way to grow.** "Our club left Snap!, why are you still paying 20%?" travels fast along tight director and parent networks, which pulls the cost to win down as a metro fills in. --- ## 2. The four ways we make money Pivt Pay earns on four things. **A, subscriptions:** free plus four paid plans for each role (clubs at $0, $49, $149 and $249), with annual plans giving about two months free. **B, a cut of NIL deals:** 20% down to 4% depending on the agent's plan, and deals with no agent pay 20%. **C, a cut of fundraising:** 16% down to 0%, where Club Zero's flat $249 a month is the whole deal. **D, a thin dues margin:** 35 basis points plus $0.40, down to nothing at Club Zero, and the family covers it. Then a few one off items: a $99 athlete sign up, media kits at $99 and $299, and donor tips. The one that compounds fastest is B, because a tenth of a big and growing deal flow beats any seat fee. Subscriptions keep the lights on while that line climbs. --- ## 3. The numbers, built from the ground up (base case) ### 3.1 The accounts, which everything else rides on Here are the growth rules, each written out so you can push on it: - Clubs start at 250 in year one (ASSUMPTION), in line with the plan: 10 first clubs, then an app launch, then 250 or so by month twelve. - Club growth slows over time, not the other way around: 3 times in year two, then 2.67, then 2.25, then 2 times. That lands at 250, then 2,000, then 9,000 active clubs. The 9,000 is about 15% of the market we named. - The share of clubs that pay rises as the product gets deeper: a third, then 42%, then half. That is 80, then 840, then 4,500 paying clubs. - Each club brings about 200 families. Roughly a third set up a free profile, and 3 to 4% of those pay for more. | Accounts | Year 1 | Year 3 | Year 5 | |---|--:|--:|--:| | Active clubs | 250 | 2,000 | 9,000 | | Paying clubs | 80 | 840 | 4,500 | | Free athlete profiles | 15,000 | 128,000 | 630,000 | | Paying athletes | 450 | 4,480 | 25,200 | | Brands | 30 | 400 | 2,000 | | Agents | 40 | 500 | 2,500 | | Coaches | 50 | 600 | 3,000 | ### 3.2 Subscriptions: money per month times accounts Average monthly price per role, with the plan mix we assumed, all at real prices: clubs $83 (mostly Pro), athletes $36.50, brands $384, agents $319, coaches $344. We trim the totals by 5% because some accounts pay annually and get two months free. | Role | Per month | Year 1 | Year 3 | Year 5 | |---|--:|--:|--:|--:| | Clubs | $83 | $80k | $837k | $4.48M | | Athletes | $36.50 | $197k | $1.96M | $11.04M | | Brands | $384 | $138k | $1.84M | $9.22M | | Agents | $319 | $153k | $1.91M | $9.57M | | Coaches | $344 | $206k | $2.48M | $12.38M | | **Subscriptions, after the annual trim** | | **$735k** | **$8.58M** | **$44.36M** | ### 3.3 The cut of money moving **Dues.** Free clubs are capped at $2,000 a season, so paying clubs carry the volume. We assumed each paying club runs $130k, then $170k, then $200k of dues (ASSUMPTION). The margin we keep is thin on purpose, about 0.30%, since the family already covers the processing. - Year 1: 80 clubs times $130k, plus 170 free clubs times $2k, is $10.7M of dues. We keep $32k. - Year 3: 840 times $170k, plus 1,160 free times $2k, is $145M. We keep $435k. - Year 5: 4,500 times $200k, plus 4,500 free times $2k, is $909M. We keep $2.73M. **Fundraising.** Half of active clubs run at least one fundraiser a year (ASSUMPTION), averaging $15k, then $18k, then $20k. The blended take drifts from 13% to 10.5% as more clubs move to paid plans and Club Zero. - Year 1: 125 clubs times $15k is $1.88M raised. We keep $244k. - Year 3: 1,000 clubs times $18k is $18M raised. We keep $2.07M. - Year 5: 4,500 clubs times $20k is $90M raised. We keep $9.45M. **NIL deals.** The marketplace is slow to start, then liquidity builds as profiles and brands pile up (ASSUMPTION on the deal totals). The blended cut eases from 12% to 10% as bigger agency deals, which pay less, make up more of the flow. - Year 1: $1.2M of deals. We keep $144k. *(450 paying athletes, 30 brands, small first deals.)* - Year 3: $40M of deals. We keep $4.40M. *(128k profiles, 400 brands, deal flow ramps.)* - Year 5: $180M of deals. We keep $18.0M. *(630k profiles, 2,000 brands, agency and collective deals.)* **One off items.** The $99 athlete sign up on new paying athletes, plus media kits and Club Zero tips (ASSUMPTION): $60k, then $350k, then $1.2M. ### 3.4 Add it up | Line | Year 1 | Year 3 | Year 5 | |---|--:|--:|--:| | Subscriptions | $735k | $8.58M | $44.36M | | Dues margin | $32k | $435k | $2.73M | | Fundraising cut | $244k | $2.07M | $9.45M | | NIL deal cut | $144k | $4.40M | $18.00M | | One off items | $60k | $350k | $1.20M | | **Total revenue** | **$1.22M** | **$15.84M** | **$75.74M** | | **Money moved through us** | **$13.8M** | **$203M** | **$1.18B** | | **Gross margin** | **78%** | **82%** | **85%** | | **Gross profit** | **$0.95M** | **$12.99M** | **$64.4M** | On margin: subscriptions run about 90%. Dues and fundraising are covered by the family or donor, so Stripe's fee lands on them, not us. The main cost is Stripe on our NIL cut, plus servers and support, which is why we start at 78% and climb to 85% as we scale. The mix tells the story. Subscriptions are about 60% of revenue today and stay around 59% by year five, but the NIL cut alone goes from a tenth of revenue to a quarter. That is the line that compounds, exactly as we claimed. --- ## 4. Low, base and high The base case is the careful one. Three things swing the result: how fast clubs grow and how many pay, how much NIL money moves per athlete, and how well clubs turn into PIVT accounts. The low and high cases just push those three. | Total revenue | Low | Base | High | |---|--:|--:|--:| | Year 1 | $0.7M | $1.22M | $1.9M | | Year 3 | $7.5M | $15.84M | $29M | | Year 5 | $33M | $75.74M | $145M | | Year 5 money moved | $0.55B | $1.18B | $2.3B | - **Low.** Clubs grow 2 times a year, paid conversion stalls at 30%, and NIL never really gets going (year five deals only $60M). That still leaves a healthy subscription and dues business. - **Base.** The build in section 3. Careful on profile conversion, NIL cut held flat to down as it scales. - **High.** Density pulls the cost to win down, half of clubs pay, more families set up profiles (45%), and NIL money reaches $300M by year five, still a small slice of the national pool. Every move has a reason behind it. --- ## 5. Unit economics All of these are an ASSUMPTION until the first clubs report real numbers. The point is the shape. | Number | Value | Why | |---|--:|---| | Cost to win a paying club | $600 | the founders sell to directors, and families spread it for free | | Gross profit per club, per year | about $2,400 | $996 subscription plus about $1,800 from dues and fundraising, at roughly 85% margin | | Clubs that stay each year | about 82% | seasonal habit, the chasing lock in, being the club's record of money | | How long a club stays | about 5 years | | | What a club is worth | about $10,200 | $2,400 a year times about 85% times about 5 years | | Value vs cost to win | about 17 to 1 | $10,200 over $600, driven by the cut, not the seat fee | | Time to earn the cost back | under 4 months | $600 over about $200 a month of gross profit | | Net revenue retention | 115 to 130% | upgrades plus more money moving plus the PIVT cross sell, net of churn | Why the cut lifts the value without lifting the cost: the NIL money and the family supply ride on an account we already paid for. We pay to win the club once, then earn off dues, fundraising, athlete profiles and brand deals for years. The cut keeps growing while the cost to acquire stays put. That is the whole reason a cut of money beats pure subscriptions here. --- ## 6. What the money buys, year by year | When | What it buys | How we judge it | |---|---|---| | **Year 1** | The iPhone app and App Store launch, 250 clubs in two or three metros, the PIVT handoff wired up | How fast a club gets its first payout, and how many turn into PIVT accounts | | **Year 3** | Android and a national push, real NIL deal flow, 2,000 clubs | NIL money moving, and revenue retention above 115% | | **Year 5** | We own the category, 9,000 clubs (about 15% of the market), the NIL cut is the biggest line | $1.18B moving through us and $64M in gross profit | --- ## What to check first 1. **Club growth and paid conversion.** This swings the result more than anything else. Check it against the first 250 clubs before trusting year three or five. 2. **Clubs turning into PIVT accounts.** How many families set up a profile, and how many pay. The whole two sided story and most of the value lift live here. 3. **The NIL ramp.** Deal flow going from $1.2M to $180M is the biggest year five line and the least proven. Confirm the deal flow and the mix of agent plans. 4. **Dues per paying club and how many clubs fundraise.** These drive the base and the $1.18B headline. 5. **Cost to win, retention and net revenue retention.** Swap in real numbers as soon as you have them. The 17 to 1 is a claim about the shape, not something we have measured yet.