Soup 2 Nuts Seminar Funding the Company Through Operations January 19, 2002.

Soup 2 Nuts Seminar

Funding the Company Through

Operations

January 19, 2002

CONFIDENTIAL, © TriCN January 20022

Presentation Agenda

TriCN = Overview, History, Vision, Team

Dynamics within IP and IC Industries

TriCN’s Value, Benefits, Positioning

Funding the company through Sales

Future Funding


Clients: Over 50 established and start-up companies.

TriCN Overview

In business since 1997.

Self-funded and Profitable since inception.

Originally Design Services and Consulting.

Financial

Revenue doubled every year.

Revenue for 2001 = $1.7M.


TriCN Team Staff of 12: Diverse backgrounds.

Motorola, DEC, MIPS, SGI, Synopsys, FCI, Nortel, CDC.

Staff responsible for over 20 patents in Circuit Design.

TriCN Founders Combined 50 years experience in data bandwidth density and circuit design.

Ron Nikel (CTO)

Chief Circuit Interconnect Technologist: SGI’s Origin scalable server project.

Hansel Collins (CSO)

Invented DSCC for HIPPI-6400.

John Ellis (VP Signal Integrity)

Obtained patents for FCI relating to HIPPI-6400.


History of TriCN

Design Services andConsulting

97 98 99 00 01 02 03

IP Licensing

1

3

5

10

30

50

04 05 06 07 08

Million $

Time


TriCN Today

Developer of High-Bandwidth Interface Intellectual Property (IP).

Currently Licensing:

High Speed Application Specific I/O (ASI/O) IP portfolio.

High Speed PLL and Mixed Signal Circuits

TriDL (Digital Dynamic Deskewing Link) = High-speed

interface technology applied to standard and custom I/Os.


Competitive Dynamics within IP and IC IndustriesHigh-Speed Semiconductor Segment

Bleeding Edge Technology: Faster, Smaller, Less Power

Long Development Cycles: 1-4 years

Weak Economic Climate: Downsizing = Buy (vs. Build)

Consolidation: Quick way to Advance Technology

Increased Fabless Foundry Model Based IC Production

ConsolidationLong Development

Weak Economy

Bleeding Edge

Strong Fabless Foundry


Benefits of TriCN IP Technology

Power Digital implementation

Low power usage

$$Real estate

Improved bandwidth density reduces pin count Saves $$ and IC real estate

$$Dev Time

TriCN technology is easily deployable Saves $$ and development time

Bandwidth Increased speed and reliability

Greater bandwidth density

TriCNMarketSolutionStrategyCompetition

AvailableNow

TriCN IP pre-verified Pre-tested in foundry processes


TriCN Value Proposition: High Margin, Large Market

Categories of IPRanked by Profit Margin

TSMC UMC IBM Other

TriCNMarketSolutionStrategyCompetition

Foundry Market Share

High Margin

Low Margin

Interface

Mixed Signal

PLL

Memory

Standard Cell

Within the IP Market Space, Interface and Mixed Signal IP have the highest margin, and TSMC/UMC have the largest market share.

= TriCN Product focus


Market Positioning for TriCN’s Interface IP

Performance

I/O Interfaces

Many

Few

TriCN

Leda

NurLogic

Artisan

Low High

High Performance, High Price Points

Mysticom RamBus

VST


TriCN & 2001 Self Funding Decision

Products are high margin, high value, difficult to obtain

technology solutions

Profitability easily maintained

Development and support of the products require a small highly

skilled engineering team

Requirement for expanded infrastructure minimal

Initiated Marketing and Sales effort

First 3 years – stealth marketing and sales effort

Formalized but minimal efforts in the past year created

hockey stick in sales and sales opportunities


Income

0

1

2

3

4

5

6

1997 1998 1999 2000 2001 2002

Income

$/person

Design Services

IP Model


TriCN SWOT Analysis

Strengths Highly Profitable Products

Scalable Business

Relatively High Entry

Barriers

Weaknesses Development limited by Rev

Growth limited by Rev

No buffer/war chest

Opportunities Sustainable Market

Few true competitors

Economic factors leading

towards client outsourcing

Threats Slowed Dev can allow

Competition to catch up

Big Company/Big $$ could

wipe out company


TriCN’s Future: 3 Options Stay with present self-funded model

Build business/valuation as able

Exit via M&A

Limited funding - $1-3 Million

Accelerate building of business/valuation

Exit via M&A

Larger rounds of funding - $5 + Million Series A

Allows for larger vision - IC Dev, Build through Acquisition

Immediately increases value

More Options for Exit = IPO, further M&A


TriCN Future Funding Decision Pros

Accelerates/Ensures Development and R&D

Allows for strategic Business Growth

Buffers against bumps in the road

Reduces Stress

Cons Reduces Upside

Must report to Board/Investors

Reduces Business Control

Reduces Control of Vision


TriCN’s Attractiveness for Funding

Pros Proven Business

Proven Team

Proven Product

Revenue Stream

Cons Potential Reduced Upside

Difficult to retarget

Reduced investor pool

Soup 2 Nuts Seminar Funding the Company Through Operations January 19, 2002.

Documents

Transcript of Soup 2 Nuts Seminar Funding the Company Through Operations January 19, 2002.