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Pooled IRR 1994-2003 (without 1999)
Poole d IRR 1994-2003
30%
30%
25% 20% 20%
25%
20%
15%
14%
15% 11% 11%
10%
10%
5%
5%
0% Early Stage Late Stage
0% Early Stage Late Stage
Source:Thompson Venture Economics
& %! + "! !
Percentage of IPO Value Created by Top 50 Firms
370 Firms $67 billion ~1,200 Firms $287 billion
100% 80% 60% 40% 66% 20% 13% 0% Firms Value 1983-1987 "PC Boom"
Source: Focus Ventures analysis of Venture One Data
Firms Value
44% 4% Firms "InternetValue 1997-2001 Boom"
Firms Value
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$ 29 billion
,
Persistence of the "Top 50" Firms
$ 187 billion
+ -
100%
Fell Out or Disolved
Moved Up or New
Ref ormations of Early Top 50 Firms
80%
60%
40%
Stayed in Top 50
Stayed in Top 50
20%
0%
1983-1987 "PC Boom"
Source:Focus Ventures analysis of Venture One data
1997-2001 "Inte rne t Boom"
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1992-1997 Venture Backed IPOs
1992-1997 Venture Backed IPOs
Years 6 5
Probability 50% 40%
4
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3 2 1 0
Seed
1st 2nd Round Round
Probability
3rd Later Round Round
Seed
1st Round
2nd Round
Time to IPO
3rd Round
Later Round
Source:Venture One
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Indexed Equity Cost and Valuations ($)
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Average Equity Cost and Valuation by Round
Financing of Venture-Backed IPOs 1993-1997 Indexed Equity Cost and Valuations ($)
6 $5.09 5 $4.05 4 3 2 $1.00 $1.00 1 0 First Round 2nd Round 3rd Round 4th Round $2.40 $1.60 $2.19 Average Valuation = 5.1X $2.09 Average Cost of Equity = 2.2X
Sources: Focus Ventures Analysis; Venture One data
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Company
Leading technology
Infinera
Optical transmission equipment for fiber optic networks Revolutionary photonic integrated circuit technology, Low cost
Raza Microelectronics
Semiconductor products
Egenera
Utility computing solutions managing corporate datacenters BladeFrame system utilizes proprietary virtualization and management software
Motricity
Provider of mobile content to consumers Provides mobile content infrastructure for the largest wireless carriers
Advantage
Multicore, multithreaded System-On-A-Chip (SOC) semiconductors
Large market opportunity
$7 – $10 billion
$3 - $4 billion
$5 - $10 billion
$25 billion+
Referenceable customers
XO Communications Level 3 Communications Freenet J. Singh – CEO (Ciena) D. Welsh – CDO (JDSU) T. Fallon–VP. Ops. (Cisco) Kleiner, Perkins Benchmark Capital Accel Partners
Huawei Juniper Networks Cisco A. Raza – CEO (AMD) A. Latif – CSO (Amati) W. Shah –VP Ops. (AMD) Warburg Pincus Benchmark Capital Kodiak Venture Partners
JP Morgan Chase AOL Fujitsu Siemens R. Dutkowsky - CEO (JDE) V. Brownell - CTO (GS) M. Thompson-VP Ops. (Stratus) TCV Kodiak Venture Partners Goldman Sachs
Cingular Verizon Palm R.Wuerch – CEO (PBH) J. Bowman–CTO (Pinpoint) M. Petzold-CFO (Verestar) TCV New Enterprise Assoc. Intel
Strong management team
Venture investors
Expected liquidity event
Q2 2007
Q4 2007
Q4 2006
Q4 2006
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