Investor Perspective

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Investor Perspective Federal Laboratory Consortium
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Agenda

• Why me- background
• Trial balloon
• Innovation economics
• Relevance to fed labs

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US Economy 101 Small Businesses

• Small businesses economic engine
• Employ half of all private sector and more than
  half GDP
• Net job growth 4x small businesses to large
  businesses

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US Economy 101 RD

• Since 2000- 1.17 trillion
• AUTM data indicates 1 startup per ___M in RD
  funding
• ITIF 20B RD construction, 402 one year jobs
  49K per 40-62k job
• Translational research 1M 36 one year jobs
  (external research labs, engineering and
  scientific services, etc. but a few of the jobs
  may be placed significantly down the line i.e.,
  local service economy jobs such as food service).

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US Economy 101 Venture Capital

• 9 private sector employees and 18.9 GDP
• Employment growth- 3.6 annual growth rate v.
  1.7 private sector
• Sales growth CAGR 11.8 v. 6.5
• 1 job for every 12.3K
• Average base salary 70-90k v. national salary
  average 32k
• 2000-2003 national employment shrank -2.3 but
  6.5 jobs growth for VC companies- recession
  proof
• Sustainability
• VentureOne report1999 companies 78 still in
  business
• 31 of all startups in business after 7 years

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State of US Venture Capital

• State of venture capital
• July 22, 2009 Senator Mark Warner asked Chairman
  Christopher Dodd if Congress could take a
  hearing or some examination of what we as the
  congress could do to look at the state of lending
  in small business and startup business, not just
  existing small businesses but how we get that
  next step of innovation because that financing
  market has disappeared. A lot of folks in that
  spectrum say they dont see any signs of it
  returning. That is totally broken.
• Is anyone filling this void?
• CVC up 33 in last 5 years
• What is licensing- big, small, VC?
• What does that mean to you?

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Federal RD resulting in startups
150,000,000,000
1,948 NEWCOS
19 Venture Backable NEWCOS
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How to Make More Venture Backable?

• Easier to identify
• Visibility
• Marketing
• Business case- SWOT
• Easier to license
• IP
• Cost
• Paperwork
• Incentivize licensing?

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How to Make More Venture Backable?

• Next gen or skip gen- 10x improvement in
  performance and/or pricing
• What is market and is G2M achievable
• Receptive to new CEO
• Capital needs to get to market
• Pilot possible?

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Challenges of startup selling to US Govt
CAGE code DUNS
FAR
NIAP
FOCI
CCR
CCR
SDV
GWAC
IDIQ
Clearance
FIPS
GSA Schedule
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Thank You
Roger London
Chairman American Security Challenge www.AmericanS
ecurityChallenge.com
Innovation Director Chesapeake Crescent
Initiative www.thechesapeakecrescent.com
6031 University Blvd. Suite 180 Ellicott City,
Maryland 21043 rlondonmd_at_gmail.com 410-340-5335