Partnering with Japan’s R&D-driven Venture Enterprises

Takeo Minomiya, Chairman

TSUNAMI Network Partners Corporation

1

Profile of Myself, Takeo Minomiya

Born and living in Ogikubo, Odawara, Kanagawa, Japan[Assignment at Sony]

Semiconductor: production, production engineering and managementVideo: Betamax/VHS - planning and technology management

8mm - development of packaging, components and CAD in addition to management of the division

Printed circuit board, tuners and semiconductor: Vice PresidentVAIO (PC): Executive Vice President in chargeAdvanced Design & Production Laboratories: DirectorRME Company (batteries and recording media): PresidentSNC (semiconductor): NC President

Co-Coo, Sony Electronics Apr.2003-Jun.2005

Chairman, TSUNAMI Network Corporation since Jan.2008[Favorite Pursuit]

Study on Ryoma Sakamoto, one of the great heroes who prepared Meiji Restoration

(Chairman of the Ryoma Sakamot Study Group at Sony)Study on Sontoku Ninomiya, a prominent figureborn in Odawara, who lead vitalization of agricultureGrowth of trees and bushes (Village for naughty kids)Playing golf (H.C. 18)

2

Japan’s First Transistor Radio “Sony TR-55”

Radio is no more in the age tied with power cable.All the radios in you family should be TR.You can carry TR with you to any place you like.

Sony Transistor Radio

By Sony (formerly TOKYO TSUSHIN KOGYO LTD.)

3

Dream “8 mm VCR” was accomplished by introducing new ideas in every aspect, starting from visual design, architectural conception and methodology, materials, information processing, to manufacturing process.

Passport-sized ”Sony CCD-TR55”

4

Wave of analog

The

seco

nd w

ave

of d

igital

The first w

ave of digital

1970 1980 1990 2000 2010

〈TV and VTR〉 〈PC〉

From the book titled “Prosperity of a country depends on semiconductor”

There has been three waves in electronics industry since 70s. The first digital wave driven by PCs followed by the second by digital consumer appliances.

Transition of Electronics Industry

Digital R

evolution

Digital R

evolution

〈Dig

ital C

onsu

mer

Ele

ctro

nics〉

5

1445 in Germany: Invention of printing press by Gutenberg

1st Industrial Revolution started from 1770 -

2nd Steam locomotives and railways 1830 -3rd Steel, electricity and heavy industry 1870 -4th Automotive, oil and mass production 1910 -

1948 in U.S: Invention of transistor by Brattain, etc. of Bell Lab.

5th Information & communication started from 1970 -

Ａ： 800 million people (13%)

Ｂ：1,500 million people (24%)

Ｃ：4,000 million people (63%)

Super Technologies/Big Bang

Europe, North America and Japan = 800 million + α

BRICs = 2,800 million

6

Estimated to be 60 times the content % of natural gold mine

1. Information & communication/automotive: technology for reduction in size and weight is essential

2. Components & materials3. Life science/biotechnology

4. Energy

5. Greentech/environment

6. Robotics/Aerospace

- Japan’s roadmap to be admired and to prosper as a peace-seeking nation -

Cost of semiconductor = $250 per unitFurther electronics employed for safety, comfort and environment

3R and promotion of recycling incl. rare metals* Mobile phone 100g (Au：0.028g, Ag:0.189g

and Cu:13.7g)Exhaust emission controlEcological materials (LED, bio-plastics and Mg alloys)

Wind and solar power generationHydrogen and bio fuelsOcean thermal energy conversion

Japan’s Technology Focus in the 21st Century

7

An Example of Next-Generation Technology

64bitCPU×3

16bitMCU×29

DRAM192MB

Flash memory

16MB

VLSI ChipCCD sensorx 2

Microphonex 7

Catching protectionsensor x 18

Angular velocitysensor x 1

Accelerationsensor x 3

Power sensor×8

Sony QRIO

Approx. 2,300 MIPS equivalent of chips (comparable to those in high-end PC) are implemented in the robot and 80 sensors are employed in total.

Infrared sensorx 3

Speaker x 1

Thermal sensorx 28

Touchsensor x 6(head, hands and shoulders)

8

Ass'y

Packaging, circuit, process and simulation

technologiesCAD/CAM/CAE

Mould

ing

press

Resin

develo

pm

ent

BATT

Bum

p

form

ation

Thin

film

Heat

treatmen

t

PCB/FPC

New

pro

cesses in

engin

eering

Metallizin

gplatin

gN

ew m

aterial develo

pm

ent

Min

iature p

arts develo

pm

ent

Micro

-fab

rication

99% of the companies in Japan = SMEs (30 million people of employment)

Acceleration of the Shift to Higher Value-added Industry

New

housin

g

materials an

d

engin

eering

Pro

ductio

n

equip

men

t

9

State-of-the art LSImixing graphics synthesizer

and DRAM Main specifications

Clock frequency : 150 MHz

Capacity of DRAM mixed : 4 MB (at 150 MHz)

Total memory band width : 4 GB/sec

Micropolygon drawing : 75 million units/sec

Total no. of transistors : 43 million transistors

Package : 384-pin BGA

PlayStation 2

Iron \ 5,000/ton Automotive \ 2 million/ton(400 times)

Silicon \23,000/kg System LSI \ 70 million/kg(3,000 times)

Service ???

Sources of Value Creation

10

Densely Located R&D Bases of Major Corporations

Region of clustering technology-oriented industry

Kanagawa ranks No.1, in terms of the no. of scientists and engineers

Top 5 Prefectures in terms of No. of

Research Institutes (Private)

149

185

186

318

669

0 200 400 600 800

Saitama

Ibaraki

Osaka

Kanagawa

Tokyo

11

Marianna Univ. School of MedicineSenshu Univ.Senzoku Gakuen Univ.apan Women's Univ.Meiji Univ.

Kanagawa Dental College

Kanagawa Univ.Tokai Univ.

Azabu Univ.Kitasato Univ.Sagami Women's Univ.Joshibi Univ. of Art and Design

Bunkyo Univ.

Kanto GakuinUniv.

Kamakura Woman’s Univ.

Keio Univ.Shonan Inst. of TechnologyNihon Univ.

SANNO Inst. of ManagementTokai Univ.

Graduate Univ. for Advanced Studies

Kanagawa Industrial Technology Center

Many universities incl. Yokohama National University are located

Universities and Public Research Organizations

Over 100 universities with science & technology faculties and over 180 faculties of science & technology in Kanagawa

Kanagawa Inst. of TechnologyShowa Academia MusicaeTokyo Inst. of TechnologyTokyo Univ. of Agriculture

0

50

100

150

200

No. of Faculties No. of Univ.

MathmaticsPhysicsManagementMarineConstructionEnvironmentalITBiologyCheimstryMachineryMaterialElectrical

United Nations Univ.Tokyo Inst. of TechnologyYokohama National Univ.Yokohama City Univ.Kanagawa Univ.Kanto GakuinUniv.Keio Univ.Tsurumi Univ.Toin Univ. of YokohamaToyo EiwaJogakuin Univ.Ferris Univ.Musashi Inst. of TechnologyMeiji Gakuin Univ.Yokohama College of Commerce

12

Venture Support Mechanism TSUNAMI

Advanced information & communication networkAdvanced information & communication network

Creating new industry and R&D-oriented venture companies

Regional support organization

Regional support organization

UniversityUniversity

Large company(technology angel)Large companyLarge company(technology angel)(technology angel)

Research institute

Research institute

IncubatorIncubator

VC and angelVC and angel

Government and public

organization

Government and public

organization

Scheme to attract various resourcesScheme to attract various resources

Human network based on deep relations of mutual trustHuman network based on deep relations of mutual trust

“Strength” of Kanagawa + Know-how of private

sector

“Strength” of Kanagawa + Know-how of private

sector

Positive cycle

Positive cycle

Fin. institutions and investment bank

Fin. institutions and investment bank

13

TSUNAMI Activities

Business plan presentations meeting (monthly)

TSUNAMI Venture Fair (annually)

Seminar: 17 timesSupport café: 16 timesOther networking event: 8 timesVenture member: 341 companiesSupport member: 59 companiesAssisting member: 116 organizations

Seminar: 17 timesSupport café: 16 timesOther networking event: 8 timesVenture member: 341 companiesSupport member: 59 companiesAssisting member: 116 organizations

111times 8

times

TSUNAMIEntrepreneurs’ Club

14

Large companyVenture

VentureVenture

SpecialistSpecialist

Requirements of industry Advanced

seeds from universities

Practical know-how

of specialists

IDEC YokohamaYokohama National Univ.

Yokohama Jisso Research Club

Yokohama National Univ.Yokohama Jisso Research Club

Kanagawa Industrial Technology Center

Yokohama TLO

Venture Support System

Venture

CompanyCompany

Large company

Large companyLarge companyAlumni group

Specialist Large company

Large company

Yokohama Jisso Consortium (YJC) for Advanced Packaging Technology

Venture

Venture

Yokohama City Univ., Kanagawa Univ.,Kanto Gakuin Univ., Tokai Univ., etc.

Field of the emergence of innovations

< Philosophy of the Consortium>1.Activation of industries in Kanagawa by the development of next-generation

jisso technology2. Preparation of the field for open interaction and cooperation among industry,

universities and government3. Fostering of venture companies with the core of jisso4. Enhancement of the level of the engineers in jisso technology by introducing

educational system5.Globalization of the proprietary jisso technology from Kanagawa

Specialist

15

July, 2006

Keynote speech by Mr. Minomiyamade at the symposium held to commemorate the establishment of the Consortium

November, 2006

Principal of the Alumni Group of YJC

Elementary schoolElementary school

Junior high/high schoolJunior high/high school

University/graduate school

University/graduate school

Alumni Group of YJCPreparation of the stage for corporate alumni to continue their active involvement in manufacturing

Involvement in Yokohama Jisso Consortium

Corporate alumni

Corporate alumni

16

Partnering for Global Hands-on

• Quickly establishing mass production formation by partnering with the production system of Taiwanese mentor companies of professional mass producer

BrandMarketing channels

Mass productionProduction control

R&DSeeds search

Corporate value

Global formation for the division of work at incubation stage

• Attract Japanese technology venture companies taking advantage of the open platform of TNP (from Universities and research organizations, etc.)

• Investing in venture companies with promising technology to incubate while identifying market needs by mentor companies

Mentor Companies

(Taiwan)

• Entering end-user market taking advantage of the brands and marketing channels of mentor companies in Japan and Taiwan

(Japan)

( mainly Japan)

(mainly Taiwan)

17

Establishment of global formation for division of work to cope with Chinese market, by combining Japanese technology and Taiwanese mass production know-how

Technology and business strategy of large companies finally shifting from vertical integration to open horizontal division of work

Non-core business will be divested by active carveout and trade sale, while core business will employ buying time strategy by M&A and joint business development based on exploration of required technologies

Canon Suzuki

Nissan

Yamatake

ROHM

ULVAC

Component

Equipment & plant

Product& service

Material

Potential Partners in Japan

Omron

Sony

Tokyo Electron

Asahi Kasei

TOR Venture Fund IITOR Venture Fund II

Creation of new industry, new business and projects

Creation of new industry, new business and projects

Potential Partners in Taiwan

Partnering Formation with Taiwan and Japan

Venture company

Venture company

Project

Trans-Tech C

Association for Taiwan-Japan

Cooperation on Industrial Technology

Premier VC

Kimpo Electronics

Invetec Appliances

Venturecompany

ASUSTeK

Chung-HuaInstitution for

Economic ResearchPartnering

PartneringPartnering

18

Friendly Cooperation between Taiwan and Japan

謝謝 !! Thank you !!

19

TSUNAMI Network PartnersCorporation

Yokohama, Kanagawa, Japan

URL. http:www.tsunami2000.co.jp

TEL. +81-45-470-8088

Investment Manager

Ra Chi羅 智

mail. ra@tsunami2000.co.jp