Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved.

Intellectual Ventures Founded in 2000, Intellectual Ventures has grown to more than 760 dedicated team members worldwide. Privately-held with >$5B under management, and >$2B in revenue. >30,000 patents under management plus thousands more added per year. IV Lab launched in 2008; >50 researchers work on a variety of projects. Company Fundamentals 2

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. What We Do 3 We Invent At IV we bring together industry-leading minds to explore new ideas, nurture innovation, and develop inventions that change the world. We Patent IV patents our own inventions, and we purchase existing patents from inventors, universities, governments, and inventive companies. We Manage IP IV manages one of the world's largest and fastest growing technology portfolios with more than 30,000 IP assets. We License IV helps companies manage risk and maintain an innovative edge with diverse products, services, and licensing options. The Business of Invention Intellectual Ventures (IV) is the global leader in the business of invention. We collaborate with leading inventors, partner with pioneering companies, and invest both expertise and capital in the dynamic process of invention. We strive to energize and streamline an invention economy that will drive innovation around the world.

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. Our invention portfolio spans a diverse range of technologies in more than 30 areas, including: Inventions with Impact 4 Medical Devices Nanotechnology Physical Sciences Security Semiconductors Software Energy Financial Services Health Technologies Information Technology Life Sciences Materials Science Agriculture Automotive Communications Computer Hardware Construction Consumer Electronics eCommerce

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. A Leader in Patents 5 Total US Patent holdings through 2009 Intellectual Ventures 33,000

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. Intellectual Ventures has created an invention marketplace, bringing together inventors, investors and partners to fuel innovation. Who Works with Intellectual Ventures 6 Investors Fortune 500 companies, leading endowments, individual investors. Clients Technology companies looking to speed innovation and manage risk. Inventors Individual inventors, start-ups, research institutions, large corporations.

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. Energize the invention economy Create and sustain a market for invention through long-term and large- scale investment of time, talent and capital. Develop valuable inventions on our own, by partnering with external inventors, and by investing in existing inventions. Supply inventions to innovative companies through a variety of licensing and partnering programs. Advocate for the value of invention and inventor’s rights through marketing and policy efforts. Intellectual Ventures is the global leader in the business of invention. In Summary 7

Developing a compelling investment / business case May 3 rd 2011

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. IV and IT Growth 9 Apr 06 ~ 80 Apr 07 ~ 160 Apr 08 ~ 250 Apr 09 ~ 450 Apr 11 ~ 760 Apr 06 = 1 Apr 07 ~ 15 Apr 08 ~ 35 Apr 09 ~ 65 Apr 11 ~ 98

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. 10 Technology Investment Governance Structure Enterprise Governance Council Technology Prioritization Committee ( Revenue Generators) Technology Prioritization Committee ( Revenue Enablers ) 80% 20% LICs Funds Biz Dev Fin HR IT Mktg/ PR Legal

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. 11 Organizational Prioritization Model (Quantitative)

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. 12 Prioritization Business Assumptions (Qualitative) The second aspect of the framework involves the use of qualitative reasoning supported by team’s experience and understanding of organizational constraints to derive the right mix of projects within the portfolio. Things we analyze : Business Owner understanding and articulation of the business problem to be solved Organizational readiness for change as validated by charter and business case Availability and readiness of solutions that address high-level business requirements Executive/Business Sponsor representation and support of the business case Alignment of the project or initiative to the department’s strategic and operating plan & goals

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. 13 Technology Investment Framework 1 ) Organizational Prioritization Model And 2) Prioritization Business Assumptions 1 ) Organizational Prioritization Model And 2) Prioritization Business Assumptions 3) Forced Ranking

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. IT Investment Transparency Run the Business Enable essential services Benefits are measured in reduced cost or risk E.g. : Exchange 2010 upgrade Grow the business Improvements in operations and performance related to existing markets and customer segments Benefits are measured in operational improvements like cycle time, increased revenue E.g.: Opening new channel of sales Transform the business New markets, new products, new horizons for the company or industry Benefits are measured in revenues in the new horizons, typically involve big rewards but also have high risk E.g.: New acquisition model, Angry birds game on the iPhone

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. IT Investments Metrics (Connect investments to P&L) Financial Metrics IRR Payback NPV P&L Business Impact Gross Margin Revenue Increase Gross Expense Reduction Operating Expense Reduction

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. Compelling Investment  Get the basics (of a business case) right  Build stories around compelling subjects: achieving rewards, avoiding major losses, strengthening security, reducing risk  Translate the main investment payoffs into favorite senior exec initiatives  Choice of language. If promoting competitive advantage, consider words like conquer, crush or triumph. If urgency is the driver, speak of pressure, speed or stress  Keep it truthful. Make sure any facts or quotes you use are accurate. If describing future situations, make it clear that they are projections  Evangelize the business value and business performance  Socialize your investment ideas before you present for “real” approval  Know your “approval” audience and their needs  Identify “influencers” & “champions”  Use Industry Benchmarks (Gartner/Forrester/IDG) wherever applicable

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. 17 Copyright © 2010 Intellectual Ventures Management, LLC (IV). All rights reserved. 17 IT Value Traps (Beliefs & Habits that seem to be good but actually lead to trouble) Visibility Trap We shouldn’t have to talk about our performance; it speaks for itself IT is the cost of doing business IT delivers great technology for the enterprise Excuse Trap Nothing is perfect especially something as complex as IT If you don’t follow our policy we can’t guarantee it will work Role Trap “The business” is IT’s customer The customer should know their business processes really well The customer is always right

Copyright © 2011 Intellectual Ventures Management, LLC (IV). All rights reserved. Q&A