letter to shareholders

Dear Shareholders,

The past six months have been one of the most valuable learning experiences for all of us, and we thank you
for your generous support along the way. I announce the conclusion of opera=ons for Hydropal, a JA
Company on 21 February, 2017. Within such a short =meframe, weve designed, developed, and produced
one of the most technologically advanced products from Renaissance College, breaking barriers of student
innova=on and entrepreneurship.

Our smart water-tracking water boLle u=lises innova=on and technology to solve a perpetual problem in a
busy city environment like Hong Kong - dehydra=on. We took a risk with developing such a sophis=cated
product, and this immense task presented many unknown and unexpected obstacles, including technical
challenges, nancial issues, =meline delays, and nego=a=ng and sourcing from mul=ple suppliers in
Hong Kong and China. We faced real challenges which demanded collabora=on, problem solving,
risk management and making dicult decisions - much of which we had not been exposed to as
students. Opera=ng a start up for the past six months allowed us to enjoy an authen=c learning
experience.

Some of our most impressive achievements were in response to these challenges. Due to
the high cost of research and development, we u=lised crowdfunding rather than
following the standard JA business model, which allowed us to raise addi=onal capital.
Our Sales & Marke=ng team conducted pre-order sales without a prototype, and did
that successfully through comprehensive sales force training. The Technology
Department designed from scratch the elaborate hardware circuitry and soUware
programming for our product, as well as hand-coded the Hydropal iOS App. To
integrate our mission into our community, we held a school event Hydra=on Day to
educate our school community on the importance of hydra=on.

In terms of nance, we are pleased to report that we have generated a total revenue of
HK$39,654. AUer paying o our expenses involved in the rigorous design, tes=ng, and
produc=on process, we conclude with a net prot of HK$2,972, which I believe is a special
achievement considering the high cost of produc=on that came with a complex product. To support our
community in improving wellness, we have donated 10% of our net prot, HK$297, to New Life Psychiatric
Rehabilita=on Associa=on, an organisa=on that provides rehabilita=on services to those with mental
illnesses in order to promote mental and physical wellbeing. Here we return HK$63 for every HK$50 share
with gra=tude for your investment in our company.

In face of adversity, our team members have shown strength, tenacity, and resilience to overcome whatever
that came our way. We would like to extend our gra=tude towards our link teachers Mr John Lee and Mr
Boyd Jerman, and our business advisor Mr Kelven Lit for their guidance along this journey. We would also like
to thank Renaissance College for their con=nuous support, and once again all of you for your faith and
contribu=on towards our company.

Sincerely,

Jamie Chan
Chief Execu=ve Ocer
Hydropal, a JA Company

1
 company
structure
Jamie
Chan
CEO

Eric Yang Shirmai Chung Jago Pang Shao-Qian Mah Tommy Ng

Human Resources Sales & Marketing Production Technology Finance
Director Director Director Director Director

Ivan Mahak Millenium Cedric Alvin

Chan Parakh Kam Kong Cheung

Dipti Srijan Jayrice Ashley

Paryani Panja Lee Park

Jerry Nicholas Cheuk Lun

Kwok Chow Ko

Jerry Andrew Adrian

Chiu Wong Tam

LINK TEACHERS:
Denis
Mr. John Lee Timothy
Wong Poon
Felix
Ho
Mr. Boyd Jerman

BUSINESS ADVISOR: Brian Ashley

Lam Fan
Mr. Kelven Lit

executive summary
VISION To strive for a community that values the importance of physical and mental health.
Through an innova=ve alterna=ve to an everyday necessity, Hydropal encourages
hydra=on as a solu=on for Hong Kong people to be more conscious of their physical
MISSION and mental wellbeing, and to incorporate this mindfulness into their daily rou=ne.

Hydropal is Renaissance College's JA Company for 2016-2017. We are comprised of twenty-six Year 12 students
passionate about design, innova=on, and the improvement of our communi=es. In Hong Kong, many city
dwellers are oUen caught up in their busy lives that they neglect their health and wellbeing. From our market
research, we found that 69% of those who surveyed were aware of the recommended water intake, however
only 28% fullled those daily water-intake requirements. We realised that this problem was prevalent across the
young to the working class, and Hydropal was founded to alleviate this issue for the Hong Kong community.

Our company oers an electronic water-tracking boLle that monitors daily water intake and connects to a
mobile app. This app informs users of their daily consump=on levels, to encourage them to be more aware of
their drinking habits and for them to set personal hydra=on goals. In addi=on, our company oers regular water
boLles that come with a fruit infuser to promote beLer health, as well as Hydropal wristbands in black, pink, and
teal to increase brand awareness. 2
 business model

When we reached the maximum share capital, we realised we faced insucient funds due to the high cost of
research and development. Hence, we adopted our own business model in order to take into account the nature
of our product, with its long produc=on =me and high costs. Thus, Hydropal conducted pre-order sales before
produc=ons to fund these expenses, following the recent crowdfunding startup business models as seen on
Kickstarter and Indiegogo. Through demonstra=ng crea=ve thinking and innova=on, we abandoned the
tradi=onal business model and developed one that t our needs.

human resources department

directors report
The Human Resources Department ensured the companys work ethics and produc=vity, tended to inner-
company conicts, and created guidelines and incen=ves to maximise company congruity.

Employees signed an Honour Code which necessitated certain company values to be upheld, such as punctuality
and aLendance, work ethic, respect, and transparency. To promote a posi=ve work ethic, we recognised
praiseworthy work through Employee of the Month awards. Our company t-shirts campaign established
concordance and unity amongst the large group, its ecacy seen during public events, such as the Trade Fair.
Hydropal was structured for exibility in each departments workforce, so we could accommodate directors
changing needs.

Company administra=on was also comprised of maintaining spreadsheets documen=ng aLendance and work
comple=on. We devised and upheld sanc=ons for employees viola=ng the employee Honour Code, involving late
fees for breaches in aLendance and comple=on of tasks, which funded awards for Employee of the Month.

For our company to be produc=ve, maintaining detailed and transparent communica=on was key. We were
mindful in upholding amicable company alliances, striving to regularly approaching individuals for evalua=ons.
We believe throughout the past three months, we were able to encourage our employees to surpass basic
performance requirements demanded by their posi=on to make signicant contribu=ons in reaching the
companys objec=ves.

3
productions department
director's report
The opera=ons department brought the idea into reality. Through designing the smart boLle, procuring
materials, and organising produc=on lines, we ensured a func=oning and quality product.

Procuring materials challenged us as our knowledge in hardware manufacturing was limited. Since our
electronics were encapsulated in the boLle cap, we consulted local 3D prin=ng companies to digitally design it.
For the packaging, boLle, and grips, we determined suppliers from Alibaba and Taobao by enquiring
about price, minimum order quan==es, quality assurance, and produc=on speed.

However, our company is rela=vely small and most minimum order quan==es exceeded
our produc=on needs. Thus, we learnt the importance in direct nego=a=ons with
suppliers to meet our specic requirements. We struggled with boLle cap
produc=on as few rms were willing to produce a complex product for a feasible
price and of high quality. We were op=mis=c and visited their oces, held frequent
phone calls, but were met with constant delayed deadlines, eventually having to
redesign the cap due to inaccuracies of the PLA plas=c. We gained invaluable
knowledge on how we should communicate to professionals when nego=a=ng
prices, sejng deadlines, and ensuring their services met our agreed parameters.

Though we may have been too hopeful in crea=ng a technologically advanced

product within a short =meframe, I am very proud, given our limita=ons as
students, we were able to persevere through teamwork and communica=ng
eec=vely with dierent stakeholders to create a working smart water boLle that
exceeded our own expecta=ons. Taking into considera=on of all the tasks necessary to
create a complex boLle challenged us and demanded development of communica=on
and problem solving skills.

director's reecIon
We promptly realised the programme necessitated a rigorous aLendance of collabora=on and communica=on,
and mee=ng them required us to beLer ourselves. Handling such an integral part of the company, I am
extremely proud that our eec=ve correspondence mo=vated each other and assented to an authen=c
produc=on experience.
members words
Even though it was challenging to design the cap with the use of CAD so7ware I hadn't used
before, I took responsibility of making the design. In the end, I learnt how to use AutoCAD,
conceptually draw the designs, and draw within a short period of Bme, allowing me to grow as
an designer. - Srijan Panja

As a student of Design & Technology, I was able to uBlise the skills learnt about
ergonomics and anthropometric data. I helped in conducBng and analysing target
market research in order to design the boJle to funcBon opBmally while being user
friendly. For example, I studied the dierent percenBle groups to determine the
posiBoning of the grips and the suitable diameter of the boJle. Overall, this taught
me the importance of understanding users' needs in any successful design.
- Nicholas Chow

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 productions flow chart
START

PRODUCTION LINE 1 PRODUCTION LINE 2 PRODUCTION LINE 3

disassemble ordered boLles (lid + cut bubble wrap / set up upload programme on Arduino
lter + boLle) packaging box

set the four digit serial code

Disinfect all components smoothen the caps with acetone +
thoroughly le o excess PLA

solder parts to programme board

QC: dry no smudges QC: smooth can place parts

QC: secure wires placement
FAIL PASSED
place grips one by one onto the
boLle (one colour per person) write serial number on box cover
PASSED FAIL

place the parts into 3D printed cap

create a wave paLern

take out the parts and lock them into place with gaskets
QC: correct placement + re-programme
enough waves
QC: sync with phone
PASSED FAIL update informa=on

placing USB port /

manual / lter in adjust bands FAIL PASSED
the boLle

add sealant to the LED, turbine,

and USB port

END closing lid and nd correct

deliver boLle
QC: waterproof
not prone to opening
PASSED FAIL
FAIL PASSED
correct serial number on
packaging in with correct boLle
add nal sealant around the rim

KEY:
placing boLles into each box
step FAIL PASSED
move onto next step
transfer to other line wrapping and taping bubble wrap ling + placing onto boLle
quality check 5
sales and marketing department
director's report
The Sales and Marke=ng Department was responsible for developing sales channels, improving sales gures,
promo=ng brand awareness, and community engagement.

We faced challenges such as fullling sales gures due to produc=ons delays and increasing revenue due to high
produc=on costs, but our team managed to prevail and come up with innova=ve solu=ons. We devised a thorough
marke=ng plan, including the crea=on of a promo=onal video in conjunc=on with our schools lming organisa=on,
and adjustments to the pricing of the product. As a social enterprise, our team conducted events, such as
Hydra=on day, to full corporate social responsibility. Through the opera=ons of our department, we have
managed to create a posi=ve and lively brand image to our community.

target market
AUer conduc=ng market research, we concluded that the following groups would benet from our product:

mothers athletes working class

too busy
monitoring constant stress
the wellbeing strong interest and overBme
of their in their health work leads to
children to and wellbeing forgePulness to
care about stay hydrated
their own

market research process

sales force training trade fair

Three salesforce training sessions were conducted to The Trade Fair was our primary sales channel to
equip our members with proper sales techniques, generate capital and raise brand awareness, rather
knowledge about our oerings, and how to convey our than purely pursuing sales. Trade Fairs sales were not
brand image. This was impera=ve as the nature of our ideal as the market demographics were mostly teens,
sales were mostly from pre-orders, and the who would consider Hydropals boLle as a huge
Trade Fair was used as a means for investment. However, it was a wonderful opportunity
crowdfunding. for company exposure. Our product was appreciated
by many judges, who have introduced us to other
We used fun and engaging methods to business opportuni=es, such as placing our oerings
train employees, such as varia=ons of onto kickstarter platorm, and interests in our
Who Wants to be a Millionaire? company from Pryde group, a Hong Kong based Sports
and Amazing Race to understand Group. These opportuni=es would be considered as a
the specica=ons of the product, team aUer the JA compe==ons ends. Through using
and sales simula=ons to train Trade Fair as a crowdfunding platorm to secure
members to approach dierent capital, our company has managed to show resilience
c u s t o m e r s w i t h s p e c i c and team-work in the process with the sales trainings
requirements and rening our sales technique.

6
 the marketing mix
place

trade fair college fair hydra=on day Bou=r (online) warm markets school stall

psychological pricing - ending the price with 9 to give incenBve to consumers to buy the product.
price Customer can get a $10 discount from liking our Facebook page to generate publicity.

$299 $179
electronic boKle college fair
$79 $10
non- electronic wrist bands/
free app
on the
(cost plus pricing) discounted price boKle boKle straps Apple Store

promotion

SCMP Ar=cle social media promo video word of mouth assembly promo brand kit

Facebook prole video student bulle=n newsleLers VLE boLle ip compe==on

product screw cap - target LED lights

markets needs lights up to remind
based on survey to drink water
soTware
sync via bluetooth water ow sensor
inside 3D printed PLA
- much
cap, tracks how grips
water passes through available in teal,
pink and black
hydropal

tritan boKle
durable, BPA free
user interface
displays up to the past LED reminders, calculate Other merchandise:
three days worth of total water intake based Hydropal Wristbands/grips
water intake graphs on sex and age, can also Hydropal Gi7 cards
set custom water intake Non-electronic Hydropal BoJles
 technology department
director's report
As a company driven by a highly technical product, the technology department had its hands full throughout the
en=rety of the company programme, from the development and planning process, to when the product was
produced. The technical aspect of the product was completely developed in-house by the technology
department, and as you can imagine, the product presented immense technical challenges the soUware
powering the device within the Hydropal BoLle as well as the app released for iOS devices on the App Store had
to be wriLen completely from the ground up and together, they are well in excess of 130,000 lines of
code. This was done on top of having to learn the complexi=es of two programming languages, SwiU
and C. Both the Hydropal BoLle and the iOS device have to communicate with each other over
Bluetooth, and a model for data transmission also had to be developed.

Moreover, the hardware circuitry had to be designed from scratch, so that it could be
produced in-house, and the components sourced at volume prices so that we could make
the best product possible without causing the product to be exorbitantly priced. And that
is disregarding the website that we made for the company, which was not built using
website generators such as Wix or Weebly, but hand craUed using HTML and CSS.

Even though we were confronted with numerous dicul=es throughout the

products development, we persevered and together, developed, what we believe,
to be one of the most technically sophis=cated JA products yet. Through this
process, we learned to collabora=vely create a technical product, iden=fy and
develop areas of strength, and work together to overcome weaknesses.

With limited =me, technological resources and manpower at our disposal, as well as a
tremendous amount of pressure, not only did we achieve what we feel is a remarkable
feat of engineering; as a team, we climbed a mountain that seemed both daun=ng and
insurmountable.

It goes without saying that I am extremely proud of what our team has achieved, and I
sincerely hope that we can con=nue learning, experimen=ng and growing as we have.

members words
What was asked from the technology team in this short period of Bme was above and beyond the call of duty of
any company sta member, let alone high school students . In addiBon to weekly meeBngs, holding the Btle of
technology team member meant the sacrice of ones personal Bme and holidays - a resource scarcely available
for candidates of the IBDP - for the benet of the company and our customers.

Through all the hardships and frustraBon, and through the demands of our product and the company, the team
went through experiences that taught paBence, coordinaBon, prudence, resilience, and respect. Despite walls
that closed in from all direcBons - be it in the form of sleepless nights, an unresolvable so7ware bug, complete
unfamiliarity with soldering, or even the visual interface of the applicaBon inexplicably deleBng itself; along the
way the team forged mutual trust, and saw their eorts blossom to the product we proudly promote. - All
Technology team members

8
 finance department
nancial statement
Balance Sheet for Prot and Loss Account
Hydropal as of 23 Feb 2017 HK$ The Year Ended 23 Feb 2017 HK$ HK$
Fixed Assets Revenue
Current Assets Sales Revenue 36,057
Stock Hydra=on Day 3,597 39,654
Debtors Costs of Goods Sold
Cash 12,675 Design submission 4,270
Fixed Liabili_es BoLle components (including prototypes) 27,594
Current Liabili_es Packaging 1,997
Creditors Technology 1,413 35,274
Net Current Assets 12,675 Gross Prot 4,380
Net Assets 12,675 Expenses
Share Capital 10,000 Marke=ng 767
Retained Capital 2,675 Rent (to JA) 100
Capital Employed 12,675 Vehicle Expenses 441
Other Expenses 100 1,408
Net Prot 2,972
Charity - 10% 297
Retained Prot 2,675
Dividends per $50 share 63
director's report
The nance department handled records of all trades, raising ini=al share capital, and determining product prices
with S&M. We also recorded the companys monthly cash ow using a cash ow statement. To raise share capital,
we appealed to families and the school community, allowing us to successfully sell all 200 shares at HK$50 per
share, raising the maximum capital of HK$10,000.

All the members decided a reasonable produc=on quan=ty was 200 units, u=lising on the The Wisdom of
Crowds strategy. With this, we calculated the cost per unit to be HKD$160. We combined cost-plus pricing
strategy (crea=ng an 85% markup) and psychological pricing to derive a sales price of HKD$299.00, which also
aligns with market research as it is much less expensive than the compe==on which retailed between $750 and
$1000HKD.

However, pre-order sale gures from the Trade Fair indicated that we could not sell all 200 smart boLles as it is a
luxury product, a rela=vely new concept, and a high-priced item compared to other JA oerings. Once we realised
that our sales gures would fall below 200 units, we shiUed our aLen=on to an alterna=ve aim: to sell the excess
stock before liquida=on. We decided to produce 120 smart water-tracking boLles and 80 regular boLles, which
would make sales easier due to the lower sales price.

Due to the complexity of the smart water boLle, produc=on costs and retail prices were high. Given a longer
retail period, I believe our company would have performed even beLer nancially as we would be able sell more
electronic boLles. This would increase our overall sales revenue while spreading the high xed costs over greater
output, resul=ng to lower average costs per unit and ul=mately higher net prots.
9
 corporate social responsibility
HydraIon Day
In order to promote our mission statement of improving hydra=on within our community, we held a school wide
event called Hydra=on Day, mirroring real publicity events such as the AIA carnival and Breast Cancer Awareness
Day.

On the day, we hosted entertaining carnival ac=vi=es to engage par=cipants to understand more about
the importance of hydra=on, with the presence of our infographics posted along the walkways in our
carnival. The health benets of hydra=on were also highlighted during the week of the event,
integrated into physical educa=on classes with teachers encouraging students to be more aware of
their hydra=on levels throughout their daily ac=vi=es. The day was blue themed to promote a
lively and cool atmosphere, as well as increase brand awareness. This was emphasised by
encouraging students to dress in blue, and selling blue coloured baked goods. In addi=on, we
also used the event as a sales channel to market our merchandise. All proceeds from the
day were directed towards Hydropal to fund our project in tackling dehydra=on.

Our school community consists of many hard working students and teachers who are
oUen so focused on their work that they neglect the fundamentals of maintaining a
healthy lifestyle. Through this event, we were able to engage with this community
where the problem of dehydra=on was signicant, crea=ng a more posi=ve
ajtude towards maintaining a healthier lifestyle.

CollaboraIon with New Life Psychiatric RehabilitaIon

AssociaIon
Hydropals mission has been to promote the physical and mental well-being of the
Hong Kong community. Therefore, Hydropal has decided to work with New Life
Psychiatric Rehabilita=on Associa=on (NLPRA), a psychiatric centre aiding pa=ents
with mental illness through a range of rehabilita=on services. Mental illness has
not been an issue highlighted when discussing about ones well-being, and this led
to Hydropals decision to donate 10% of the companys prots (HK$297) to support all
projects from NLPRA. Aside from monetary contribu=on, Hydropal will be undergoing volunteer
trainings and eld work at the centre to support NLPRA with its rehabilita=on projects later in
April. The volunteering work was conducted aUer the liquida=on of our company, so that part
of our funds donated could be invested towards a project we will plan with alongside NLPRA.

10