Global Alliance Technology Ventures between US and Asia Pacific

1
Global Alliance - Technology Ventures between US
and Asia Pacific CIE-SEA Fall Conference, Sept.
23, 2001 Ronald Chwang, Acer Technology
Ventures, America Chairman President
2
Elements leads to Venture Success

• Idea
• Better faster cheaper Brave new world
• Talent
• Vision, execution, experience
• Market
• Customer demand, value proposition
• Capital
• Self-generated profit external investment
• Bond by a common interest - return for all stack
  holders

3
Cross Pacific Venture Model - North America
focused
North America
Asia Pacific
Idea
Stock exchange
Talent
Talent
Investment
Investment
Market
4
Cross Pacific Venture Model - Asia Pacific
focused
North America
Asia Pacific
Idea
Talent
Talent
Stock exchange
Investment
Market
Market
5
Successful Examples

• Semiconductor Industry (Taiwan /US)
• Wafer Foundry
• Assembly testing
• Fabless Chip Design Companies
• Software Industry (India /US)
• Programming outsourcing
• IT consulting and services
• Application development remote support

6
Recent factors driving new venture models

• Internet Communication Infrastructure
• Enable better global product business
  collaboration
• Growing number of Asian Entrepreneurs
• Ideas and talent
• Opening of China domestic market
• Potential for self-sustaining growth
• Availability of Asian based venture capital
• More knowledgeable on Cross-Pacific investment

7
Cross Pacific Venture Model - New evolving model
North America
Asia Pacific
Idea
Idea
Talent
Talent
Stock exchange
Stock exchange
Investment
Investment
Market
Market
8
Acer Technology Ventures

• Acer Group venture investment arm since 1997
• Structured as an independent professional venture
  fund management company
• Funds under management
• - ATVF - 40 million (100 Acer)
• - IP Fund One (May, 2000) - 260 million (40
  Acer/60 institutions)
• Active value-added investment style

9
Acer Technology Ventures
Taipei
10
The Greater China Opportunity

• It is not an over-night sudden phenomenon
• Well orchestrated, staged, progressive and
  effective opening up
• Challenges and uncertainty abound
• Three driving factors
• Availability of human resources
• Potential of huge domestic market
• Embracing the Global community WTO, Olympics
  2008

11
The Year 2000, a Watershed Year

• China replaces Taiwan as the worlds third
  largest hi-tech hardware supplier.
• Taiwan players contribute more than half of China
  outputs
• Taiwan hi-tech manufacturers intensified the
  offshore movement. The first time over 50 was
  made overseas.
• Over 30 of Taiwan companies manufacturing is
  based in Mainland.

12
China-bound Investment from Taiwan

• The PULL
• Huge potential local market
• Abundant resources (labor, land, engineer,.)
• WTO and Chinas opening up
• Follow the supply-chain foot-step
• The PUSH
• Taiwans uncertain macro-economy outlook
• Cost and efficiency of the business
  environment
• MNC customers urge to move forward
• Potential exit for excessive funds

13
Venture investment in Taiwan

• High-tech and global business focus
• Successful venture investment practice
• Well accepted entrepreneur incentive system
• Matured corporate governance and SEC regulatory
  control
• High Liquidity stock market

14
China Challenges Entrepreneur maturity

• Vision does not equal to Execution
• Separation of management and ownership
• Corporate governance and transparency
• Building solid business vs. making deals
• Technology focus vs. Customer focus

15
China Challenges Market and business risks

• Government policy can influence economic decision
• WTO accession - not an overnight panacea to China
  problems
• Fragmented markets
• People Centric / Guanxi
• Respect and protection of IP

16
China Challenges Return on Investment

• Legal, judicial and commercial support
  infrastructure
• Professional private venture practices
• Regulatory constrains and interpretation variance
• Sound and clear investment exit path for foreign
  investments

17
Venture opportunities in Greater China

• Wireless technology and applications
• Photonic industry
• Seamless heterogeneous telecommunication
  infrastructure solution
• Software OEM/outsourcing and remote support
• Biotech and healthcare

18
Feeling the stone while crossing the river
??????
19
Focus, determination, and perseverance!
20
Together, we shall steer through the rough sea!