1. SMALL BUSINESS’ RESPONSE TO GLOBAL TRENDS IN GREEN MARKET Dr. Misha Plam President and CEO AlphaSniffer, LLC Boulder,Colorado,USA Presentation for New Ventures Investor Forum in China October 22, 2004

2. AlphaSniffer, LLC is a start up company in Boulder, Colorado, USA, funded by VC investors in 2004 Company is developing a novel Handheld detector for Homeland Security and Industrial Applications. The Detector will alert workers to exposure to dangerous toxic levels of Industrial Toxic Chemicals (TIC) present in the working space. The same detector will help companies to comply with EPA and OSHA Regulations.

3. What is the US SBIR Program? 10 Government Agencies Defense  DOD Defense Health  HHS Health Space  NASA Space Energy  DOE Energy  NSF IT, AM, EL, BT Agriculture  USDA Agriculture Commerce  DOC Commerce Environment  EPA Environment Transportation  DOT Transportation Education  DoED Education TOTAL ~ $1.5B Annually

4. What is the SBIR Program?  Small companies have innovative ideas.  Government agencies provide funds to small companies to explore and commercialize those ideas.

5. What Is the SBIR Program?  Companies submit proposals (Competition, peer-review, merit)  Government funding in three phases  Companies do not repay funds  Companies keep intellectual property  Government benefits: jobs, taxes

6. SBIR Program: Funding Process PHASE I Feasibility Research PHASE III Product Development for Commercial Market Private Sector Investment Taxes Federal Investment PHASE II Prototype Research Gov’t Agency R&D Budget

7. SBIR Program Results: 20 Years  400,000 proposals received  65,000 proposals funded: $13 billion  Creation and growth of thousands of companies (including Microsoft, Intel)  Catalyst for economic development

8. Every Large Company in the beginning of their life was a SMALL company. It is very important that Entrepreneurs who start the new company develop a culture, which will be foundation for the future Big Company in terms of Environmental Concerns and Social Responsibilities. However small businesses very often luck necessary recourses – Money, Knowledge and Infrastructure. The KEY is Education at the Universities, Government support through tax breaks/regulations and support and collaboration with Big Business. Very often small businesses are suppliers to big businesses, who can require from their vendors strict compliance with the Environmental Government Regulations.

9. Big Businesses very often a very good neighbor, protect Environment and protect their workers. They do it back in US and they are trying very hard to do the same in Foreign Countries where they conduct business and trying to penetrate market. Good example is Shell Corporation, which is supporting this conference. But Big US businesses can do much more by supporting Education through special courses in Chinese Universities by providing financial support. They can also give Guest lectures by their Environmental Compliance Officers, provide Scholarships for Environmental Education and Apprenticeship in their facilities. Typically Big business has Money, Knowledge and infrastructure to address Environmental concerns.Big Businesses very often a very good neighbor, protect Environment and protect their workers. They do it back in US and they are trying very hard to do the same in Foreign Countries where they conduct business and trying to penetrate market. Good example is Shell Corporation, which is supporting this conference. But Big US businesses can do much more by supporting Education through special courses in Chinese Universities by providing financial support. They can also give Guest lectures by their Environmental Compliance Officers, provide Scholarships for Environmental Education and Apprenticeship in their facilities. Typically Big business has Money, Knowledge and infrastructure to address Environmental concerns.

10. In protecting environment and making socially responsible rules and legislature the Government has to have a leading role. I visited China since 1996 and I saw incredible improvements in social aptitudes and culture, I will provide only several obvious cases, which could be seen by the naked eye.

11. 15years ago driving in Chinese taxi was like driving inside of operational trash can and ashtray. Government changed it overnight and now China has uniformly the BEST taxi in the word. I applaud you !!!

12. Taxi drivers were educated how to be polite, provide receipts and say nice words. It creates incredibly good mood in a passengers, except traffics jams. I wish we have posted the same regulations in the taxi, which you have here. The public toilets equipped with modern equipment became very clean. And there are many other examples of protecting Environment and Health of the People in the Modern China. However much more has to be done!

13. China has incredible number of small restaurants preparing foods, very often with a lot of fat. The Fat disposable is a big environmental problem with pollution of municipal water supplies. Small restaurants cannot solve this problem by themselves, but if big Oil American and Chinese companies will create Fats refinery to convert used food oils to oils for car engines and provide collection services from restaurants and other food establishments then it will be great service to Chinese Nation.

14. Another example of typical business pollution recently discovered in US is Arts Schools and Individual artists. This business was never regulated by the Government, because nobody considered an Art school as a chemistry lab, but they are. Artist use a lot of toxic chemicals, which they dispose to the sink. US government provided grants to the Art Schools to solve this problem, created regulations and ask small businesses through SBIR program to develop new purifications technologies

15. CONCLUSION American Big businesses working in China has to help small Chinese businesses to become socially responsible and environmentally friendly. In order to do this they have to invest money in education of the future Chinese business leaders and show by example how to be a good and friendly neighbor

16. Thank you ! m.plam@comcast.net Dr.Misha Plam m.plam@comcast.net