Projected annual big data growth is 37% through 2017 There is a large opportunity to reinvent industries using data Costs have come down… …Resulting in significant data and revenue growth Source: Wikibon 2010: $ : $1 1990: $10

Significant venture capital dollars have been invested in big data in recent years Source: Orrick >30% annual growth in deal volume and investment size from

Much of data analytics today is focused on serving incumbents

Opportunity to rebuild approach to serving customers from the ground up Feedback loops with data are a powerful mechanism for product improvement New business models use data to provide a higher level of service to customers

Companies must be reinvented from the ground up to fully leverage the potential of data Starting with a clean slate can lead to radically new models, products, and services, and startups are best poised to do this Gaming Venture Capital Taxi Studio model with large sunk development cost with limited pre-launch testing Dispatch systems expensive dedicated equipment, no driver or passenger feedback Very manual process with limited optimization or use of data Incumbent model New model

Early stage investors look for data opportunities with specific criteria 1) Large, valuable markets that havent innovated… yet Capital requirements in line with market opportunity 2) Opportunity to transform status quo with data Cost savings, personalization, or a better customer experience 3) Team that blends industry skills and a strong engineering mindset 4) Product development emphasizing rapid iteration and optimization of product and processes; lean startup approach 5) Sustainable competitive advantage Networks effects, proprietary data, high switching costs, etc.

Many industries are being transformed Data infrastructure Data analytics Finance Media Security & govt Health Education Travel & transport Retail Other

Case studies SignalFire ClassDojo Metromile

Entrepreneurs have lower Capex requirements and more funding options than ever before… … VCs must be more proactive Large VC Crowdfund Incubator MicroVC Midsize VC

Low barriers have increased the noise; now its possible to process signal Organized Channels Digital Channels Unstructured Channels FEEDBACK LOOPS w/ MACHINE LEARNING FILTERING Data integration, cleansing, and structuring Filtering Machine learning Investment team Feedback loop from team, fundings, and company performance

Platform informs seed-stage investments with full information and low cost structure Incubator program Boutique VCs Large investments Small investments Full resource VCs Sweet spot for early stage investor / startup alignment

SignalFire is reinventing venture capital with a new business model, new architecture, and data analytics Competitive advisory and VC firm built on top of a data analytics platform Rethought venture business from the ground up using large amounts of data Tracking key company characteristics based on venture capital best practices Machine learning algorithms process and highlight emerging opportunities Building a networked partnership structure with feedback loops Platform will help identify opportunities for investment, partnership, and acquisition, and provide general competitive intelligence

ClassDojo: Behavior management software for the classroom Customer pain point Competitive advantage ClassDojo data solution Teachers spend significant time in the classroom focused on student behavioral issues, which detracts from teaching Existing process of logging behavioral issues is time-consuming and memory-based Parents only receive feedback from teachers ~2 times per year, so feedback between the classroom and the home is discontinuous Smartphone app that enables teachers to immediately reward good behavior and call out bad behavior The teacher can track students over time Gives parents real-time feedback on how their kids are doing behaviorally, tightening the feedback loop Incumbent players in education are slow to innovate and execute Have established first mover advantage with 17M teachers and students in 120 countries Ability to scale virally since it is curriculum agnostic (applicable across countries)

MetroMile: Pay-as-you go car insurance Customer pain point Competitive advantage MetroMile data solution Drivers that drive less pay disproportionately higher rates Car insurance companies do not take distance driven into consideration when setting premiums, though accidents occur less often with infrequent drivers Targeted car insurance product for those who drive less than 10,000 miles per year Product plugs into existing car diagnostic ports (OBD-II) and collects data on key vehicle usage metrics Pricing is in line with distance driven Opportunity to add unique services based on data insights Incumbent insurance companies run the risk of cannibalization; lower premiums for infrequent drivers would increase premiums for frequent drivers and customer churn MetroMile is focused on disrupting car insurance through innovation and has an engineering culture; incumbents lack engineering culture and tend to outsource Rapid scalability even in highly regulated markets through strategic partnerships; will be available to 40% of the US within 6 months

As VCs, we are excited about opportunities both in data analytics as well as vertical solutions with data at their core Data infrastructure Data analytics Finance Media Security & govt Health Education Travel & transport Retail Other Whats the next industry to be transformed by data?