European Incubators in Silicon Valley: the M31 case

Aldo Cocchiglia, CEO – M31 USA

Stanford Engineering School, January 3 2011

M31 is the code name for Andromeda

galaxy

M31 is a galaxy of technology stars

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What’s in a name?

What does M31 do?

M31 Italia turns innovative technologies into start-ups.

M31 USA turns technology start-ups into successful global companies.

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M31 Italia founded in Padova, Italy in 2006Focus on incubation: working with entrepreneursfrom seed funding to corporate exits

M31 USA established in Silicon Valley in 2010Initial focus: global expansion for Italian high-techcompanies including start-ups and larger high-tech enterprises

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Where and When

Venture incubation - office space and office shared services

Funding – from seed to 2nd + rounds

Management advisor– from strategy to execution

Global Business Development –from leads to contracts

M31 Operating Model

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Sectors we invest in: Medical Equipment, Embedded Computing, Optical Systems, Software and Web, Sensor Networks

Core competences: Innovative Product Development, Strategic Management, Global Reach

Services provided: from incubation to management, from international expansion to exit

Deal flow: affiliation with universities, research labs, private companies, Angels, early-stage VCs., etc.

Typical investment size: € 50 K to 2.5 M, with syndicate if needed

M31 Focus

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M31 is different from:

Business Plan Competitions

We invest capital

Traditional Incubators

We provide more than just office

space and services

Angels and early stage VCs

Founders retain large equity

stakes and we co-manage the

company with them

Our Value Proposition

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M31 decodes the

start-up DNA

M31 Portfolio

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software & WEB,

sensor networks,

I-net of things

biomedical

instruments

embedded

electronics & PCs

adaptive

optics

wireless

antennas

WEB services

WEB services

in eyecare

Shareholders

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Private Investors, including academics, business managers and entrepreneurs

TTVenture - Technology Transfer Venture Capital Fund

M31 Management Team

Funds raised since 2007: $ 10 M

M31 investments: $ 10 M

Management Team

Ruggero FrezzaPresident, M31 Italia

Riccardo FontanelliCOO, M31 Italia

Aldo CocchigliaCEO, M31USA

Mauro OdoricoBoard Director, M31Chief Investment Officer of TTVenture

Elisabetta GhisiniCMO, M31 USA

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M31 USA

Global Expansion Services• US entry planning• Global expansion planning• Start-up incubation in SV• Innovation tours for Italian companies and university programs• Exit strategy and Fundraising support for additional rounds

Gateway to Italian Technologies• Technology scouting for US companies• Partner/supplier scouting for US companies• High-tech investments in Italy: start-up or product line acquisitions

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M31USA Clients

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M31 Portfolio Companies

University Technology

Transfer Offices

Italian High-Tech

Companies

M31 portfolio companies: the CenterVue case

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The CenterVue Case

Incorporated in April 2008 - first startup for M31

Develops hw & sw for cost-effective screening programs to detect and treat ocular diseases that bring to blindness

Shareholding: M31 46%, Seed investor 28%, Founders & Management 26%

Total capital raised: $2.4M; headcount: 17

Developed two innovative devices approved by FDA in 2010, and a Web software platform

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The CenterVue Case

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The Eye Knowledge network: a Web platform for eye care, i.e. online continuing education, expert consultation and telemedicine

MAIA: early detection and management of Age Related Macular Degeneration (AMD)

DRS: a fully automated, inexpensive, retinal camera for large scale screening of Diabetic Retinopathy

The DRS

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Takes digital photo of the backof both eyes in 50 sec. andtransfers it to telemedicineplatform for remote diagnosis

Fully automated: requires noinstallation, no training and nooperators

Sale price: less than half of any competitive product

Can be available at any health-care point nationwidewith no need for skilled operators

Allows for basic and large–scale data collection forprevention of diabetes-related blindness

The DRS

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Highlights of the CenterVue Story

Major positive impact on social costs of blindness in US and worldwide

Short development time and very limited investment thanks to the “M31 model”

2010 sales: 120+ units

Estimated 2011 sales: 1700+ units in 60 countries for $25+M (64% in US)

Planning an exit via acquisition or IPO in US within 2 -3 years

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M31 Italia SrlVia N. Tommaseo 7735131 Padova – ItalyPh: +39 049 781 1811www.m31.com

M31 USA, LLC4655 Old Ironsides Dr.Santa Clara, CA 95054Ph: +1 408 988 8404www.m31usa.com

M31: Incubation of European Ideas, with European R&D, European job creation and US business development

aldo.cocchiglia@m31.com