Innovation and US Manufacturing Competitiveness Tom Baruch Founder, CMEA Capital Innovators – SAMCEDA 2010 Awards of Excellence April 30, 2010

Venture Capital Investments by Region, 2009 PWC/NVCA MoneyTree Report Silicon Valley 1

Demise of Corporate Research Bell Labs Pharma Patent Cliff: revenue coming off patent by 2012 Datamonitor $ Billion 2

Moore’s Law Meets Mendel’s Law For the past 50 years Moore’s Law has driven innovation in electronics and biotechnology R.H. Carlson (2010) Biology is Technology Harvard University Press Transistors per Chip; Bases/person/day Year 3

Young Firms Account for the Bulk of Job Creation Share of annualized net job creation in Percent Firm Age Kauffman Foundation, U.S. Census Bureau 4

Jobs (in millions) Job Creation by Startups Kauffman Foundation, U.S. Census Bureau 5

VC’s as Brokers of Innovation Large companies Universities Venture Capital Startups Mid-size Companies 6

Leadership 7

Innovation Agenda K-12 education in reading, science and math Basic research R&D tax credits Lower corporate taxes Intellectual Property Protection Ambassadors of entrepreneurship Immigration 8

Energy Market is >$2 Trillion A $1 Trillion Opportunity in Renewables/Efficiency Demand BRIC Economies Geopolitics Energy Security Supply “Exponential Technologies” Low Carbon Economy Depletion of Non-Renewables Global Scramble Barrel of $

Urgent New Applications in Climate Change and Energy Tremendous Need for Low Carbon Technologies Carbon Mitigation Initiative, Princeton University 10

Convergence and Innovation The next 50 years will require collaborative, global and multi- disciplinary processes Innovation will happen at the borders where different disciplines meet Energy and Materials Life Science Information Technology 11

Applications Development A Major Opportunity - Closing the Scale-Up Financing Gap Commercial Products Materials Discovery Bottlenecks in Commercializing New Technology 10 years Accelerated Commercialization will occur at the intersection of problems and markets 20 years Intimacy of problems and markets is key 12

Optimized Final Product Assay the Library  Representative  Predictive  Automated: uses computational analysis Create Library  Biological or Material  Automated High-throughput Synthesis  Introduces Complexity and Novelty Select Winners Build new library based on best-performing materials Platforms enable discovery of new materials >1000x faster than traditional methods Accelerating Materials Discovery with Combi Synthesis Market input 13

A Major Opportunity - Closing the Scale-Up Financing Gap Semiconductor Industry Challenge New materials drive IC performance more than reductions in scale 14

Intermolecular’s Solution Massively Parallel Processing Enables Faster Cycles of Learning Many Processes/Wafer One Process/Wafer Conventional R&D Approach Combinatorial R&D Approach 15

A Major Opportunity - Closing the Scale-Up Financing Gap Intermolecular: Representative Project Using Moore’s Law to Accelerate Moore’s Law Molecular Masking Layer for 32nm Copper Interconnect 4 Engineers 5 Weeks 7,635 experiments (deposition conditions) on 60 molecular types 18,300 characterization experiments 2 Hits for Scale-up Using conventional methods and the same number of people: It would have taken 5 years instead of 5 weeks to run this number of experiments. Only 140 process conditions could have been analyzed, instead of

A Major Opportunity - Closing the Scale-Up Financing Gap ProSAR Analytics Wild type Enzyme Evolved Commercial Biocatalyst Codexis Technology Platform 17

A Major Opportunity - Closing the Scale-Up Financing Gap Cellular Engineering Transcriptomics Proteomics Metabolomics Fluxomics Genomics Input Product 18

Innovation and Entrepreneurship will… Leadership Top to Bottom Commitment Platforms Innovation Economy Programs Policies Market Intimacy Experienced Entrepreneurs Revitalize the Commercial and Economic Power of Silicon Valley 19