Investor PerspectiveFederal Laboratory Consortium

Agenda

• Why me- background

• Trial balloon

• Innovation economics

• Relevance to fed labs

US Economy 101Small 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

US Economy 101R&D

– Since 2000- $1.17 trillion – AUTM data indicates 1 startup per $___M in

R&D funding– ITIF $20B R&D 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).

US Economy 101Venture 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

State of US Venture Capital

• State of venture capitalJuly 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 don’t 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?

$150,000,000,000$150,000,000,000 1,948 1,948 NEWCOSNEWCOS

19 19 Venture Venture Backable Backable NEWCOSNEWCOS

Federal R&D $$ resulting in startups

How to Make More Venture Backable?

• Easier to identify• Visibility• Marketing• Business case- SWOT

• Easier to license• IP• Cost• Paperwork

• Incentivize licensing?

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?

Challenges of startup selling to US Govt

GSA Schedule

FOCI

Clearance

CAGE code DUNS #

CCR

CCR

FAR

SDV GWAC

IDIQ

FIPS

NIAP

Thank You

ChairmanAmerican Security Challenge

www.AmericanSecurityChallenge.com

Innovation DirectorChesapeake Crescent Initiative

www.thechesapeakecrescent.com

Roger London

6031 University Blvd. Suite 180Ellicott City, Maryland 21043

rlondonmd@gmail.com410-340-5335