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Future Growth June 17, 2014

15 FINNISH ICT COMPANIES

2

0

500

1 000

1 500

2 000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Net Sales EUR 1520m in 2013

10-year growth 6.0%

4-year growth 1.0%

Market Cap Development

10-year return 1.7%.

0

500

1 000

1 500

2 000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

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GROWTH POSITIONING

3

0,0

1,0

2,0

3,0

4,0

5,0

6,0

-10% 10% 30% 50% 70%

AVERAGE EV/S MULTIPLES VS CAGR GROWTH

Proven Scalable / Self-serve SaaS

VC A/B rounds 2014: EV/S 4-5X

Proven SaaS / Software VC B-

rounds 2013: EV/S 2.3 – 2.7x

Listed ICT companies average

EV/S = 1.7

4

GROW FAST OR DIE SLOW

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GROWTH PARADIGM, software

5 Source: McKinsey, 2014

6

LETS BUILD SMTHING BIG FOUR STAGE MODEL

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STAGE 0

7

Vision

Entrepreneur

Innovation

Product Lovers

Constant Renewal

Excitement

Trend riding

OPPORTUNITY

FOR REVOLUTION

Startup Sector 5-yr Est. CAGR (2012-2017)

Software 29%

Hardware 30.1%

Med Tech 6.3%

Big Data 34.2%

Dev. Platforms 17.9%

START-UP TRENDS

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Trends Trends

Software Software

Hardware Hardware

Med Tech Med Tech

Big Data Big Data

Developer Platforms Developer Platforms

SaaS, Enterprise, Big Data, Ed Tech, & Media Sharing

Internet of Things, Natural UI, 3D Printing, Wearable Tech

Patient/Doctor Platforms, Pharmaceuticals, Medical Devices, & Healthcare Services

Search, Cloud Computing, Data Storage, Data Mining, & Machine Learning

APIs, VoIP, Code sharing/repositories, Platform as a Service

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9

STAGE 1

10

Vision => Strategy, G-to-M

Entrepreneur => Management team, Execution

Innovation => Road-map, IPR, Scalability

Enablers Venture Funding

Business Partners, Corporate Support

Serious customer & user traction

100% focus on international set-up

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STAGE 2

12 Adapted from McKinsey, 2014

The right market = The BIG one

Monetization model enabling a full scale up

Rapid adoption, massive roll-out. Multiple customers instead

of one big one

Leadership capability, systems, ecosystem.

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STAGE 3

13 Adapted from McKinsey, 2014

Expansion into new territories, dig everywhere.

Acquisitions with 100% strategic future fit, not the ones with

mere resource add-ons and size enhancers.

From Product to Platform.

REPEATING THE FINNISH B2B SUCCESS

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TEKLA – acquired by Trimble for 400m in 2011

STONESOFT – acquired by McAfee/Intel for 300m in 2013

NAPA – acquired by ClassNK for 53m in 2014

DELTAMARIN – acquired by AVIC for 40m in 2012

Sensinode, Applifier, Rightware, Miradore…

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MOST LOW-TECH. AIRBNB.

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In 2007

… roommates Chesky and Gebbia

made their living room into a bed

and breakfast, accommodating

three guests on air mattresses and

providing homemade breakfast.

In 2014

500 000 places for rent

33 000 cities, 192 countries

Valuation USD 10 billion …

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PRIVATE MONEY

THE FUTURE GROWTH ENGINE

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How to pitch to VC’s

Pre-seed Seed Start-up

Early-stage

Expansion

Target / Exit

Idea generation & formulation

Business plan

Company establishment

Pilot deals, references

10-50 employees

Strongest growth phase

Venture capital funding

International, GLOBAL

Solid IPR

500+ employees

Worth 1000m

ENTREPRENEURSHIP BOOSTED BY

VENTURE CAPITAL

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10 elements to take care of

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I What do you actually do? - Which problem are you solving / what solution are you offering - Why do you do it - Why it’s important to potential customers - What is your market potential mass / niche II Where is the huge potential? - The end game has to have huge potential - Most companies will fail but if there is no such opportunity... - Product/platform - Roadmap for the future potential

10 elements to take care of

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III True market size - Market has to be there - Big enough to be interesting - You have to know your total addressable market - Segments of the market IV Secret ingredient – People - People’s business – in early stage most important element - No one man shows - The role of each member – not just CVs of past achievments - Strenghts & weaknesses – self awareness

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10 elements to take care of

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V Go-to-market Strategy - Minimum viable product - Path of least resistance to customers - Channel strategy, you have to know the dynamics - Who has the control of the entry VI The stage where you are - Be honest - Have you already gained the proof & momentum - KPI’s to support this - Helps to make the decision

10 elements to take care of

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VII Real competitive advantage - Technology/IP, first mover, unique business model - Long term understanding - There are always competitors - All ends up to execution VIII Show the product - Demo, easier to understand - VC’s are not experts in every industry - Focus where it solves the problem - UI/UX

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10 elements to take care of

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IX Financials - Believable projections - Key drivers - Both revenues & costs - What you actually are going to do with the money X The deal - How much money you are going to raise - What’s the plan for future financing - Cap table - Idea of the valuation Finding the perfect partners for financing is crucial, but not easy!

Opportunities of tomorrow

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25

STAGE 3

Adapted from McKinsey, 2014

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Adapted from McKinsey, 2014

Future Growth