Working With A Large Company Jean-Louis Trochu Texas Instruments May 2011

 Top Line Growth  Innovation May 2011 JL Trochu At the center of today’s hi-tech companies goals, be they Small or Large. “Do or Die”

What could the large company seek?  Access to technology or product  Development of the eco-system, Differentiation, Catching up, etc.  Access to a new business model  Access to a new market  Access to talent pool  Intangible benefits May 2011 JL Trochu

What could the start-up seek?  Generate sales  Direct sales  Opportunity to integrate into a system solution  Leveraging on infrastructure, name recognition  Access to manufacturing  Access to capital  Direct equity investment  Intangible benefits / Other May 2011 JL Trochu

Selling directly to a large company  Price  Timely device development and qualification  Assurance of supply (unknown demand)  Clean of IP infringement risk / claims  Financial resilience and default risk (breach) May 2011 JL Trochu CA-based semiconductor start up, VC financed About 5 year old, one known customer, ~$10M in sales First opportunity to sell to TI on a sole source basis but had to invest $$ upfront; significant revenue and profit

Multiple engagements  TI reimbursed company to port its SW on TI’s silicon  TI invited company at customers visits, trade shows,..  2010 – TI declined investing in company  Change in TI BU executive mngt and account mngt  Change in company structure  Company delivers on goal / nurture relationship  2011 – TI revisiting potential investment in company May 2011 JL Trochu Belgium based software start up, with complex structure About 4 year old, one known customer, <20 employees Great algorithm SW complementing TI’s offering but limited ability to engage with global customers

Direct Equity Investment May 2011 JL Trochu Israel company is 1 year old, appealing SW technology No financing available, no revenues, <10 employees Great 3D algorithm SW to differentiate TI’s offering Ownership <20% Board observer only Veto and other tight pre- emptive rights Not just an equity invest. Not equipped for exit mngt Not equipped for daily intervention, staff upgrade,.. Not always perf. aligned How strategic investors generally differ from VCs

Some Observations….  Stay focused  Know what you really need, what your vision/goals are  Balance opportunities with constraints  IP protection; today’s gain vs tomorrow’s handcuffs  Establish multiple-point relationship  Nurture; everyone needs attention; it is a marathon  Develop your selling / negotiating skills  Prepare; ask lots of questions; adjust to audience  Know your alternatives; move on w/o burning bridges  Enlist experts  Not everyone is a CEO to-be; devil is in details May 2011 JL Trochu

Title  Lorem ipsum dolor sit amet, sed sem sed magna suscipit egestas.  Lorem Fusce sed sem sed magna suscipit egestas. May 2011 JL Trochu Good Luck and Thank You