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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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Visions of the Future
© Proprietary & Confidential – Ariadne Capital
How Ecosystem Economics™ will Define the Winners and Losers of the
Exponential Age
© Proprietary & Confidential – Ariadne Capital
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
© Proprietary & Confidential – Ariadne Capital
The Face of Every EntrepreneurThey just may not show it to you!
© Proprietary & Confidential – Ariadne Capital
Two Good Reasons
• They see the inevitable and advance the Future• They are willing to live abnormal lives
© Proprietary & Confidential – Ariadne Capital
Capital Follows IdeasAlways Has, Always Will
© Proprietary & Confidential – Ariadne Capital
The History
© Proprietary & Confidential – Ariadne Capital
Let's Continue With The Historical Perspective….
© Proprietary & Confidential – Ariadne Capital
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
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
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
The Revolution
© Proprietary & Confidential – Ariadne Capital
THE REVOLUTION STARTS AS A SMALL FACT
WITH BIG PROMISEAND MOVES TO A SIGNIFICANT
FORCE IN THE MARKET
© Proprietary & Confidential – Ariadne Capital
Technological Revolutions
• 1999 – David with
his slingshot wants to kill Goliath
© Proprietary & Confidential – Ariadne Capital
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
The David & Goliath™ Model
© Proprietary & Confidential – Ariadne Capital
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
Network-orientation to business
© Proprietary & Confidential – Ariadne Capital
How do I acquire customers?
© Proprietary & Confidential – Ariadne Capital
Examples of Corporates engaging with Digital Enablers
• Large corporates which are partnering and/or acquiring digital technology firms include:
© Proprietary & Confidential – Ariadne Capital
If you didn't go to Palo Alto at the beginning, you will go to Palo Alto in the end …
© Proprietary & Confidential – Ariadne Capital
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
Ecosystem Economics
™
© Proprietary & Confidential – Ariadne Capital
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
MONITISE IS THE THIRD FASTEST GROWING COMPANY IN THE UK
© Proprietary & Confidential – Ariadne Capital
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
Price (GBp)MONI:LN
© Proprietary & Confidential – Ariadne Capital
© Proprietary & Confidential – Ariadne Capital
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
Industries are being transformed by digital
business models
© Proprietary & Confidential – Ariadne Capital
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
© Proprietary & Confidential – Ariadne Capital
Don't Go To Palo Alto – Go To www.entrepreneurcountry.com
© Proprietary & Confidential – Ariadne Capital
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
Be A Native
Not A Tourist
© Proprietary & Confidential – Ariadne Capital