Important changes to minimum rates and charges

Thank you for your continuous feedback and the many suggestions for improvements. Some
important changes are due at designenlassen.de which affect our users:

Increase of minimum prize-money

The minimum rate for prize money on our platform has remained unchanged for nearly three
years. The customer has had to pay at least €200 in prize money, although we recommended
€300. We have often considered increasing the minimum required prize-money, but to this point
we have discarded the idea. To be honest, we feared losing customers if we increased the
minimum prize-money. We are aware that we are not the only design platform on the market
and our competitors currently have similar or lower prize money requirements.

However, the reality is that we cannot keep the prize money requirements at the same level
forever, thanks to inflation and the costs of business operation. For this reason, we have
made the difficult decision to increase our rates slightly, by €5 to €10 in every category. As an
example, logo-design now starts at 205 €, with our recommendation and preset-target at €310.

The increase of minimum prize is effective immediately.

The reward for winners decreases to 85% of the prize money.

Until this point, we have paid out 87% of the prize money to the winning designer. This reward
will be decreased to 85 %. It is clear that these changes may not sound like positive news
for the participating designers. With this in mind, we would like to briefly explain what we at
designenlassen have to pay with the prize money percentage that does not go directly to the
designers. Armed with this knowledge, it may be easier to see why we see this change as a
necessary step to ensure the life and health of Designenlassen.

Let‘s take a case where the customer pays €200 prize money at our platform. The supplier
who handles the payment immediately takes approx. 3 to 3,5%, or about €7. We then have
to pay 3,9% (4,1 % from 2013) of the prize money we receive to the artists’ social insurance,
rounded to approximately €7. The artists’ social insurance curiously enough must always be
paid, whether or not the winning designer is based in Germany. There is then a transaction fee
when paying the prize money to the deigner of approximately 1% (€2). We also have to account
for the possibility of fraudulent payments from customers, which costs approximately 0,5% (€1).

An final slim margin is retained as contribution necessary for maintaining the platform and
marketing expenses of Deignenlassen. Altogether, these business costs total approximately
8,5% of the prize money paid to us. This decrease in percentage paid to the designer is
taking place simultaneously with the increase in the minimum prize, so this does mean that
the designer will actually receive more money than before despite the percentage decrease.
For example, a project with €300 prize-money and 87% reward would have paid €261
before. Now, with €310 prize-money and 85% reward the designer will receive €263,50.

The change in reward percentage will be effective for all confirmed data transfers starting
15.12.2012.

Naming-Projects only with guaranteed prize money – contentwise

Altough we get very few refunds (the rate fluctuates between 5% to 10% for advance
payment projects), it is always disappointing to us when no winner is chosen and the
creatives get nothing. By far the most refunds have taken place in the naming category.
This is why a lot of creatives have requested that the naming category always have
garanteed prize money. We have decided to implement this request, and trust that our
customers will still choose us for their design needs by continuing to announce naming-
projects on our platform. Our hope is also that the naming community will kick off in earnest
now since the designers will know there is always guaranteed prize money!

The change in naming-projects takes effect immediately.

As always, we welcome your feedback!