1. Intro to Qualcomm Ventures
& Trends in Silicon Valley
May / 2011
1

2. Agenda
 Introduction to Qualcomm Ventures
 Mega trends in Silicon Valley VC –
Wireless Sector
 Where are VC dollars flowing?
 Q&A
2

3. Qualcomm : from a start up to a global leader in mobile
communication and computing industry
2010
• $11B in revenue, $20B market cap.
1985
• Irwin Jacobs founded • ~16,000 FTEs in 53 locations world wide
Qualcomm
• ~80,000 patents world wide with 300+ licensees
• “I hope to grow this
company to 30 FTEs”
• Listed on NASDAQ 100
• Member of S&P500, Fortune 500
3

4. Qualcomm Ventures : strategic venture capital investment arm
of Qualcomm
“QCV's mission is to accelerate and influence the growth of the wireless market
while supporting Qualcomm's corporate and individual business units' strategic
goals by fueling innovations in venture community”
Early stage focus with long Connection to critical
term commitment resources
• We know what it takes to grow a • Not only financial capital,
start up to a global leader portfolio companies instantly gain
access to Qualcomm’s global
network & business (inside &
outside of Qualcomm)
Qualcomm
Ventures
Instant credibility No competing interest
• Qualcomm is known for its • We manage global portfolio
technology leadership – portfolio without competing investment
companies’ technology receives
instant validation
4

5. Qualcomm Ventures is a global venture capital with presence in 6
regions/countries
 Established in 2000 as a corporate venture capital of Qualcomm Inc.
 Currently 16 investment professionals in 6 countries with ~$500M under management
 Global access to portfolio companies
London
San Diego
Tel Aviv Beijing
Seoul
Bangalore
5

6. Qualcomm Ventures focuses on 4 major mobile industry
segments
Wireless components & devices Enabling technology
Infrastructure Applications, software and services
6

7. Qualcomm Ventures Korea was established in 2010 with
an objective to invest in and foster early stage venture
companies
Founded • October, 2010
Investment • Strategic fit with Qualcomm – mutual strategic benefits
Criteria • Financial gain on investments
Main investment focus
Investment Later stages /
Seed Series A Series B
Practice Pre-IPO
• Up to $500K • $1M~$3M • Up to $6M • Up to $10M
• Seed stage • ($4M)
dedicated fund
• sdsds
− Seed funding • Less than 20% ownership
competition • Co-invest with another FI or SI
for early start • Usually no board seat required
ups
− 2010 winner :
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8. Agenda
 Introduction to Qualcomm Ventures
 Mega trends in Silicon Valley VC –
Wireless Sector
 Where are VC dollars flowing?
 Q&A
8

9. 5 Venture capital mega trends in recent years
Mega Trends Implications
1. Wireless investment back to peak More innovation, disruption, and big
levels exits
2. VCs focused on services/apps that Big R&D budgets no longer an
are capital efficient with low advantage vs. nimble start-ups
barriers to entry
Monetization still challenging for
3. “Try before you buy” or services/apps, unless you have a
“Freemium” model dominate platform or “castle” to leverage
4. It is all about the mobile internet VC is an extension of R&D for large
platform players (Google, FB, etc. )
5. Market heating up around mobile More and more funding; speculations of
a bubble
9

10. 2009: VC Investment in Semi Declining Precipitously while
Software Holding Up
 Perceived as a “Big boys game”’
 64% of VCs believe that there will be a decline in semiconductor investments
in 2010*
$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
2002 2003 2004 2005 2006 2007 2008 2009
*NVCA
Bus Prod & Services CP & Services Financial Services IT Services Semiconductors Software
10

11. 2010: Wireless Investment Back at Peak Levels, Driven by SW for
Services & Apps
Investment focused on sw
Wireless Financings by % of Deal
Wireless VC Investment Peaking Again
Wireless Financings by Dollars ($Bn)
. . . And on the consumer
Wireless Financings by % of Deal
11 Source: CapIQ, Rutberg & Co Wireless Financings in 2010

12. Services/App Startups Create Wealth at an Incredible Pace
400M users / 200M DAU
Platform for all Social
Media
Worth ~$15B
Which spurred the
developer ecosystem
Worth ~$5B
Which spurred the
alternative billing
ecosystem
Worth ~$3B
All the companies mentioned above (except Zong) did
not exist prior to 2004
12

13. Low Barriers to Entry & Success
Average $s Raised in 2010 Tapulous: $12M in revenue + profitable
on $2M invested capital
Most active Remainder
sectors
Capital is available for nimble start-ups resulting in low
barriers to entry
13

14. Freemium and Try-Before-You-Buy Model
Increases ability to scale users – but monetization is a
challenge
14

15. VC as an “extension” of R&D for Large Platform Players
Apr 03 Aug 05 Nov 06 Sep 07 Mar 10
Google Search Platform
(Upstartle)
Mar 05 Mar 06 Jun 07 Mar 10 Feb 10
 VC investment focused on mobile internet – monetization is from existing “castles”
 Google is nimble at acquisitions, with reasonable success – they did 26
acquisitions in 2010, mostly small “tuck in” technology/talent acquisitions.
Already done 8 deals in Q1 2011 – picking up the pace . . .
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16. Market is Heating Up Again
$50B when GS invested and $120B
at IPO?
2010 At IPO
# users 500M 1B (assumed)
Rev / user $4 5x $20
Profit / $1 6x $6
user
Valuation $50B $120B
Valuation /
User $100 $120
Val. / rev. 25 6*
Val. / prof. 100 20*
* Matrix for Google in 2010
16

17. Agenda
 Introduction to Qualcomm Ventures
 Mega trends in Silicon Valley VC –
Wireless Sector
 Where are VC dollars flowing?
 Q&A
17

18. 2010: Where are the VC Dollars Flowing?
High $s and Deal Volume
VC $s invested in 2010 ($MM)
Number of VC deals in 2010
18 Source: CapIQ, Rutberg & Co Wireless Financings in 2010

19. Gaming: VC Investment Overview
Game Monetization Social Gaming
Game Engines
Developers Platforms Networks
• Provide tools, • Broadening titles • Platforms for • Social gaming
platforms for for greater developers to • Provide
developers appeal monetize their additional
• Social and games via ads discovery
geosocial games and virtual • Gate to
goods monetization
 Area that is exploding is casual gaming (vs. console gaming)
 Developers constantly looking for novel experiences
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20. Gaming: Going Mainstream
 Casual gaming is changing Gamer demographics
 67% of American households play computer or video games
 The average age of the most frequent game
purchaser is 40 years old.
 40% of all game players are women
 Zynga says 60% of their players are women
 Gamification: Game-dynamics in all apps to drive engagement
 Education/learning
 Marketing/branding
 Location & social network apps
20 Source: IPG Labs, 2011 Trend Presentation, TechCrunch, PopCap Survey, 2011

21. Gaming: Moving to the Cloud
 Focus shifting from the hardware to the network
 Allows flexible pricing models which adds accessibility to a broader segment
 Lowers friction to consumption - no retail buying of game consoles
 Once technical challenges with gaming are resolved, this can be applied to
other media – software, etc.
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22. Social: VC Investment Overview
Social Content Social Gaming
Geosocial Networks Geosocial Shopping
Aggregation Networks
• Check-in at local • Aggregate feeds from • Product comparisons • Play with others in
merchants Twitter, FB, etc. • Recommendations your social network
• Recommendations • Interact across all from the social
social networking sites network
via one location • See what others are
buying
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23. Social: Maturing as a Business
 Monitor traffic on the social platforms – what are consumer’s saying about a
brand?
 Execute marketing campaigns via social platforms
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24. Location: Overview of VC Investment
Location Location
Geosocial Mobile Location-Based
platforms for advertising &
networks shopping Gaming
developers analytics
• Check-in at • Product • Help developers • Geo-based • Measure
merchants comparisons build location- gaming location-based
• Receive • Mobile-checkout based apps analytics for
rewards • Many focused advertising
• Recommend on local
merchants to
build local
apps/presence
 Local merchants looking to develop apps for consumers – serve as marketing
& promotion platforms
 Geosocial networks both drive traffic to a store as well as verify that a
consumers is in the store
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25. Video: Overview of VC Investment
Video projection Video sharing Video ad
Infrastructure
technologies technologies networks
• Optimize • HW+SW • Share video • Serve ads into
bandwidth solutions to real-time video services
• Manage video enable video • Consumer • Focused on
traffic projection service publishers/devel
• Focused on opers
client & server
• Sell to
operators
 Managing video over networks still a problem to be addressed as
video traffic grows over smartphones
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26. Marketing/Ads/Data: VC Investment Overview
Mobile Medium Advertising Location
App analytics &
marketing & focused platforms & advertising &
advertising
analytics (video, audio, games, etc.) networks analytics
• Application • Internet analytics • Tech platforms • Provide • Location based;
focused • Various focused on technology connecting
• Moving into ad approaches specific platforms consumers to
platform (embedded mediums only • Provide ad physical world to
device SW, network drive sales
panels, etc.)
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27. Core Value is the Data Layer
Data layer is the core
of value driver
This is what Google,
FB, etc. are focusing
on as they continue
to strengthen their
ad platforms
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28. Payments: VC Investment Overview
Charge transactions to
customers’ wireless
Carrier Billing
carrier bill via mobile web,
(for Virtual Goods) app or SMS
Hardware/software to
Contact/Contactless transfer money between
Payment merchants and customers
(for Physical Goods)
Users send and receive
money and redeemable
Peer-2-Peer
gifts over mobile app and
SMS
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29. Payments: Key to Controlling the Ecosystem
 Managing the transaction is one of the “control pillars” of the ecosystem
 The player that controls the transaction, also controls the ecosystem by:
• Defining the pricing models (and hence the business model)
• Defining the framework for developers and consumers to interact
• Gaining the consumer trust by handing their money – creates high switching costs
• Lowering friction to monetization
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30. Payments: Crowded & Set to Consolidate
 Mobile payments is
very fragmented –
consolidation likely
 Rumors of impending
acquisition of key
players like Boku,
Zong surfacing
 Google backing NFC
and OEMs
responding
30 Source: GP Billhound LLP, 2011 Predictions

31. Agenda
 Introduction to Qualcomm Ventures
 Mega trends in Silicon Valley VC –
Wireless Sector
 Where are VC dollars flowing?
 Q&A
31