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© Proprietary & Confidential – Ariadne Capital @EnCountry @juliemariemeyer [email protected]

Don't go to Palo Alto - Julie Meyer TOA Berlin

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The world is evolving fast, its getting shorter and connected. Palo Alto is no more the birthplace of great startups and companies. They are mushrooming everywhere from Europe, Africa, Asia, South America and Australia. New digital game changers are emerging and leading the torch of change faster than ever before, addressing local challenges with globally implementable ideas. However the infrastructure and support is lacking and for that, unlike before one need not go to Palo Alto. EntrepreneurCountry is creating this world class support system right here, next door to you, so you can access key players and fast track the route to success without moving from your location. Don't go to Palo Alto.Go to EntrepreneurCountry!!

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Page 1: Don't go to Palo Alto - Julie Meyer TOA Berlin

© Proprietary & Confidential – Ariadne Capital

@EnCountry @juliemariemeyer

[email protected]

Page 2: Don't go to Palo Alto - Julie Meyer TOA Berlin
Page 3: Don't go to Palo Alto - Julie Meyer TOA Berlin

Visions of the Future

© Proprietary & Confidential – Ariadne Capital

Page 4: Don't go to Palo Alto - Julie Meyer TOA Berlin

How Ecosystem Economics™ will Define the Winners and Losers of the

Exponential Age

© Proprietary & Confidential – Ariadne Capital

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Three Visions of the FutureThe Technology Platform Companies take over every industry

• As Apple has to Music & Telecoms

• As Google has to Advertising

• As Amazon has to Books

The Digital Davids become disruptive forces and create new established giants

• As Wonga has to personal loans

• As airbnb has to travel• As Uber has to taxis

David and Goliath Must Dance

• David brings the new understanding of how technology enables an ecosystem through data and business model

• Goliath brings customers, distribution, scale and reach

Scenario Evidence Winners

vs.

vs.

1

2

3

© Proprietary & Confidential – Ariadne Capital

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© Proprietary & Confidential – Ariadne Capital

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The Face of Every EntrepreneurThey just may not show it to you!

© Proprietary & Confidential – Ariadne Capital

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Two Good Reasons

• They see the inevitable and advance the Future• They are willing to live abnormal lives

© Proprietary & Confidential – Ariadne Capital

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Capital Follows IdeasAlways Has, Always Will

© Proprietary & Confidential – Ariadne Capital

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The History

© Proprietary & Confidential – Ariadne Capital

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Let's Continue With The Historical Perspective….

© Proprietary & Confidential – Ariadne Capital

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Economic Growth since the end of the 18th Century has gone through 5 Distinct Stages,

associated with 5 successive Technological Revolutions

Five Successive Technological Revolutions, 1770’s to 2000’s

Technological Revolution

Popular Name for the Period

Core Country or Countries

Big-bang initiating the revolution

Year

FIRST The Industrial Revolution

Britain Arkwright’s mill opens in Cromford

1771

SECOND Age of Steam and Railways

Britain (spreading to Continent and USA)

Test of the Rocket steam engine for the Liverpool-Manchester railway

1829

THIRD Age of Steel, Electricity and Heavy Engineering

US and Germany forging ahead and overtaking Britain

The Carnegie Bessemer stell plant opens in Pittsburgh, Pennsylvania

1875

FOURTH Age of Oil, the Automobile and Mass Production

USA (with Germany at fist vying for world leadership), later spreading to Europe

First Model-T comes out of the Ford plant in Detroit, Michigan

1908

FIFTH Age of Information and Telecommunications

USA (spreading to Europe and Asia)

The Intel microprocessor is announced in Santa Clara, CA

1971© Proprietary & Confidential – Ariadne Capital

Page 13: Don't go to Palo Alto - Julie Meyer TOA Berlin

Lifecycle of a Technological Revolution

Gestationperiod

Big-bang

Paradigmconfiguration

Introduction of successive new products, industries and technology systems, plus

modernisation of existing ones

Constriction of potential

Time

Period one Period two Period three Period four

Around half a century

Deg

ree o

f te

ch

nolo

gy m

atu

rity

an

d m

ark

et

satu

rati

on

Early new products and industries. Explosive growth and fast innovations

Full constellation (new industries, technology systems and infrastructure)

Full expansion of innovation and market potential

Last new products and industries. Earlier ones approaching maturity and market saturation

© Proprietary & Confidential – Ariadne Capital

Page 14: Don't go to Palo Alto - Julie Meyer TOA Berlin

AGE OF IT AND TELECOMMUNICATIONS50 ISH YEAR CYCLE – 1971 TO 20...?

• BIG BANG – NOVEMBER 1971 IN SANTA CLARA, CALIFORNIA

• Bob Noyce and Gordon Moore launched Intel’s first microprocessor, the precursor

of the computer on a chip

• INSTALLATION – late 1970’s through to Noughties

• 1976 – Steve Jobs, Steve Wozniak found Apple Computer

• 1984 - Michael Dell founds PC’s Limited later named Dell Computer Corporation

• 1985 – Irwin Jacobs founds QualComm, pioneer in Wireless Communications

• 1990 – CERN / Tim Berners Lee

• 1994 – Yahoo founded

• 2003 – Skype – “free calls on web”

• 2004 - Facebook founded

• THE TURNING POINT

© Proprietary & Confidential – Ariadne Capital

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The Revolution

© Proprietary & Confidential – Ariadne Capital

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THE REVOLUTION STARTS AS A SMALL FACT

WITH BIG PROMISEAND MOVES TO A SIGNIFICANT

FORCE IN THE MARKET

© Proprietary & Confidential – Ariadne Capital

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Technological Revolutions

• 1999 – David with

his slingshot wants to kill Goliath

© Proprietary & Confidential – Ariadne Capital

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The Economy & Social Institutions Respond

• 1999 to 2013 – Broadband and Mobile Technologies continue to invade our lives

• 2014 -David and Goliath must dance

© Proprietary & Confidential – Ariadne Capital

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The David & Goliath™ Model

© Proprietary & Confidential – Ariadne Capital

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Strategic Value

Network Effects- Lock In

Vulnerability

The David/Goliath Grid Model

Financial Value

“Dav

id”

– D

igita

l Ena

bler

– th

e ‘D

igita

l Car

“Goliath” – Distribution – The Highway

Ecosystem Economics™ – shifting industry players

Consumer Data driving new services

Network Orientation to business

Market is bigger than just top players

When partnering with, When acquired,

Brings lean operating system

2)

1) Brings new digital revenues

Und

erst

ands

“th

e ne

w c

omm

on s

ense

1)

2)

3)

4)

Can become the Operating System to the Industry

Can reinforce or gain a position as Industry Architect

1)

2)

© Proprietary & Confidential – Ariadne

Capital© Proprietary & Confidential – Ariadne Capital

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Network-orientation to business

© Proprietary & Confidential – Ariadne Capital

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How do I acquire customers?

© Proprietary & Confidential – Ariadne Capital

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Examples of Corporates engaging with Digital Enablers

• Large corporates which are partnering and/or acquiring digital technology firms include:

© Proprietary & Confidential – Ariadne Capital

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If you didn't go to Palo Alto at the beginning, you will go to Palo Alto in the end …

© Proprietary & Confidential – Ariadne Capital

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APPLICATIONS“Digital Enablers”

INFRASTRUCTURE High Regulation, Low Margin, Others

using your investments without contribution

PLATFORMS

How entrepreneurcountry enables the App Economy

Transition to platform centric companies withCloud, Social,

MobileBig Data solutions

Goliaths(Non-

technology mid-large

enterprise)

Take advantage of Revenue

(Profits)

MakeInvestments in Assets (Costs)

© Proprietary & Confidential – Ariadne Capital

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Ecosystem Economics

© Proprietary & Confidential – Ariadne Capital

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Innovation is about Economics Not Technology

• Otherwise we’d all be flying the Concorde

• But we’re packed into Jumbo Jets

© Proprietary & Confidential – Ariadne Capital

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MONITISE IS THE THIRD FASTEST GROWING COMPANY IN THE UK

© Proprietary & Confidential – Ariadne Capital

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MobileOperat

ors

has created The Mobile Money Ecosystem over the past 12 years

Bank Platforms

CoreBanking

Other e.g.• CRM• Database

Wealth

Enabler

Use of standard Interfaces

3rd Party Providers

• Sharedealing• Insurance

Payments• Domestic • International

Shopping&

Loyalty

National

Services

• Transit• Utility

CardsProcessor

MobileTopUp

© Proprietary & Confidential – Ariadne Capital

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Price (GBp)MONI:LN

© Proprietary & Confidential – Ariadne Capital

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© Proprietary & Confidential – Ariadne Capital

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and Ecosystem Economics

• Google says that they organise the world’s information

• They actually organise the economics of the world’s information

• I, as a consumer of their search, am not given any economic upside in the search

transaction

• They have built a multi-billion pound business using – albeit anonymously – my personal

data – aggregated with that of others, but releasing none of the economic value to me

• Their biggest Achilles Heel is if someone in the search space were to cut a different set

of economics for the consumer

• Ariadne Capital found that entrepreneur – John Paleomylites – founder of BeatThatQuote,

and sold his business to Google on the 4th of March 2011 for a 122 EBITDA multiple for

these reasons

© Proprietary & Confidential – Ariadne Capital

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Industries are being transformed by digital

business models

© Proprietary & Confidential – Ariadne Capital

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In 2014, “Network Benefits” accrue to those Firms who understand their role in their ecosystem and organise the

economics for it

This in turn leads to exceptional returns for their shareholders

© Proprietary & Confidential – Ariadne Capital

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© Proprietary & Confidential – Ariadne Capital

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Don't Go To Palo Alto – Go To www.entrepreneurcountry.com

© Proprietary & Confidential – Ariadne Capital

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entrepreneurcountryUK - Laboratory • East Africa

• Finland• German-speaking Europe• Ireland• Nigeria• Nordic Region• Poland• Southern Mediterranean• South Africa• Spain• United Kingdom –

NorthWest, Cardiff, London

Expanded to 15 regions on the 30th September:

© Proprietary & Confidential – Ariadne Capital

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Be A Native

Not A Tourist

© Proprietary & Confidential – Ariadne Capital