By Hank Habicht (Managing Partner, SAIL Venture) Nancy Tsai (Professor, CSUS)

Agenda
y y y y

Clean Tech Innovations Clean Tech Driving Forces U.S. Clean Tech Venture Capital Investments Clean Tech Opportunities in Taiwan

Clean Tech Innovations

y Optimizing the usage of scarce and valuable natural resources such as water, air, energy and others y Reducing the ecological impact caused by the industrialization and human being life style y Adding significant economic value for existing Clean Tech product by either lowering process cost or increasing benefit

Clean Tech Driving Forces

y Water shortage & contaminated water y Environmental issues y Human health issues y Climate change & air pollution y Green house effect y Human health issues y Energy crisis y High price y Imported Mideast oil y Awareness y Government y Public

Clean Tech Investment Market

y y y y y

14 percent in U.S. investment market 18 percent in Europe investment market $4.7 billion investment total in 2008 Will be $226 billion investment total in 2016 Largest wealth creation for the 21st century

Clean Tech Business Model

y Seed stage: new concept or product under development less than 18 months y Early stage: a product or service in testing or pilot production for commercial purpose and in business less than 3 years y Expansion stage: established for more than three years with some significant revenue growth from its product or service but without a profit y Later stage: widely commercial available product or service for generating ongoing revenue and positive cash flow

Clean Tech Investment Situation

y A stimulus for creating jobs and reducing

the dependence on fossil fuels by Obama government total $ 21.8 billion

Clean Tech Partnership

y Entrepreneur new and worthwhile technology y Funding source public & private investment for a profit y Customer ample individuals for adopting product y Government Incentive policy & environmental regulation

Clean Tech Strategy

y Find optimal combination of technology, team and scalable business model y Identify biggest problems with profitable solutions in a reasonable timeframe (57 years) y Engage all partners to deliver victories

Venture Capital Investments in USA

y US GDP (Gross Domestic Product or National Income) $14.55 trillion in 2008 y Venture capital intake $28.3 billion in 2008 y Venture capital investment is 0.2% of total GDP y Providing 10 million US jobs y Having sales of 2 trillion (17 percent of GDP)

U.S. Venture Capital Investment in 2008

Sector Life science Software Internet Clean tech Media IT service Telecom Semiconductor Total 2008 Investments (in billions) $8.0 $4.9 $4.9 $4.1 $2.0 $1.8 $1.7 $1.7 $28.3 % Change Vs. 2007 <15%> <10%> +55% +3% +17% Decline Decline <8%> # of Deals 853 881 825 277 407 262 N/A N/A 3,808 Average Deal Size (in millions) $9.4 $5.6 $5.9 $14.4 $4.9 $6.9 N/A N/A $7.4

U.S. Venture Capital Investment: Company Development Stage in 2008

Company 2008 Development Investment Stage (in Billion Seed Early Later Expansion Total $1.5 $5.3 $10.8 $10.6 $28.8 % of Total 5.3% 18.8% 38.3% 37.6% 100% % Change Vs. 2007 +19% <4%> <13%> <9%> <8%> # of Company 440 1,036 1,177 1,178 3,831 Average Funding (in millions) $3.4 $1.5 $9.2 $9.0 $7.36

U.S. Venture Capital Investment in Clean Tech 2001 2008

Year
# Deals % change Vs. Previous Year Investment (in millions) % change Vs. Previous Year

2001 61 400

2002 65 07% 391 <3%>

2003 59 <09%> 271 <31%>

2004 76 29% 438 78%

2005 88 16% 544 13%

2006 135 53% 1,418 160%

2007 233 73% 2,642 86%

2008 277 19% 4,100 55%

Clean Tech Venture Capital Investment in 2008

Technology Sector Solar Biofuels Transportation (electric vehicles, batteries, fuel cells) Wind Electric Grid Agriculture Water Investment (in millions) $3,300 $904 $795 $502 $345 $166 $148 Percentage 40% 11% 9.5% 6% 4.1% 2% 1.9%

Opportunities in Taiwan
y Great investment environment y Business partnership y Clean tech investment opportunities y Social and economic Benefits

Investment Environment
y Government: Executive Yuen, National Science Committee, Ministry of

Finance, Ministry of Economics, Bureau of Industry and Bureau of Environmental Protection

y

Incentive policy & regulation

y Research institute y New products for commercialization y Business & industry y 2nd largest IT in the world can be the foundation & driving force for clean tech innovation y Funding source y Well established stock market and financial systems y Wealthy Angels & business y Grant & incentive from Government y Customer y Well known products & major share of world market y 11 % export to US, 10% export to Europe Union y Major export components to Asia countries

Business Partnership
y Partners y Investor y Entrepreneur y Management y Employee y Goal y Making the best Clean Tech product for a sound profit in Taiwan y Critical success factors y Competent y Trust y Honest y Empowerment & accountability y Communication

Investment Opportunities
y Energy storage y Energy efficiency y Alternative energy and renewable

energy y Water resource

Energy Storage
y battery provided the energy for a product will last as long as the product itself y Clean and green battery for making the environmental friendly uninterrupted power source (UPS) y Efficient storage device for collecting and saving solar energy and wind energy y Increasing the performance and efficient of different power tools and equipments y Providing solar energy for lighting the street lights and traffic lights y Supplying power for electric car

Energy Efficiency
y Green building equipped with nanoinsulation, smart windows, energy efficient appliances, advanced lighting system using 1/10 of the energy by the light bulb, renewable power source (solar or wind) and storage (battery) y New electric grid to reduce the power waste during the transmitting process y Computer systems to work with the green house for controlling smart windows, energy efficient appliances, advanced lighting system, renewable power source (solar or wind) and storage (battery) y New material for collecting solar energy y New method for getting wind power

Alternative Energy and Renewable Energy

y Solar y Wind y Agriculture plants y Waste

Water Resource
y Water desalination y Sewage treatment system y Industrial water treatment system y Agriculture wastewater treatment

system

Social and Economic Benefits

y y y y y y

Reducing the green house effect decreasing the air and water pollution Slowing down the global warming Preserving the mother nature Improving the living condition for better health Relieving some of the energy dependency on the imported high price fossilfuel y Providing job and business opportunities for the entire value chain from the raw matter supply to the finishing product distribution y Increasing the value of the gross domestic product y Continuing the economic growth for the next decade

Conclusion
y Clean Tech investment is a winwin

situation for every involved entity y Government y Funding source y Business y Consumer