Will Price's presentation from Big Sky Dev Con 2016

1. WILL PRICE
NFC FUND PRESENTATION
January 2016

2. NEXT FRONTIER CAPITAL
Build MT companies of impact, utility, and meaning
$21.125m in committed capital
3 MT investments to date
MISSION & OVERVIEW
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3. LACK OF VENTURE FUNDING IN MONTANA
MAJOR ISSUE AND OPPORTUNITY
• <$1M per quarter invested
• Founders without access to start-up capital
• Coastal VC firms little appetite for early stage risk in
MT, usually cherry pick late stage “winners”
• Material ramifications for company formation,
job growth, and ecosystem development
PAGE 3 Source: NVCA

4. STATE
PER CAPITA
RESEARCH FUNDING
PER CAPITA GDP
PER CAPITA VC
FUNDING
COLORADO $200 $56,142 $164
UTAH $180 $49,079 $278
MONTANA $170 $41,629 $2.89
MT/CO 85% 74% 1.76%
MT/UT 94% 85% 1.04%
Despite comparable research and
GDP dollars, MT receives 57x and 96x
less VC$ than CO and UT, respectively
CO and UT data indicate MT can support
$36-68m/qtr. in VC funding vs. the
~$1m/qtr. today
INVESTMENT OPPORTUNITY
RELATIVE TO CO AND UT, MT IS SIGNIFICANTLY UNDERSERVED CAPITALIZED
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NVCACenter for Measuring University Performance BEA.gov Census.gov

5. UT AND CO: FOUNDER FRIENDLY VC DYNAMICS
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6. THE VALUE OF ADVANCED INDUSTRIES
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7. THE VALUE OF ADVANCED INDUSTRIES
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8. THE VALUE OF ADVANCED INDUSTRIES
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9. INVESTMENT OPPORTUNITY
BUSINESS CLIMATE SCORECARD
PAGE 9 Source: Choose Montana
Bozeman Chronicle

10. Top Parameters for
Acquisitions in MT
Ability to hire and retain a quality
engineering team
Degree to which company is stand-alone vs.
to be integrated
Strength of core team
Ease of travel – direct flight
TOP PARAMETERS
Top Parameters for
Investing in MT
Ability to build and recruit team in Montana
Quality of local syndicate partner
Probability of finding another deal in MT
Ease of travel – direct flights
FOR VCS AND M&A
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Source: Fund research

11. MONTANA STATE UNIVERSITY OF MONTANA
ANNUAL FUNDING $128M $62M
RATING
VERY HIGH RESEARCH
UNIVERSITY: 1 OF 108
HIGH RESEARCH UNIVERSITY
AREAS OF EXPERTISE
• Optics
• Photonics
• Biotechnology
• Energy/renewables
• Medical
devices/pharmaceutical
• Computer Science
• Agriculture
• Biological sciences
• Chemistry and
biochemistry
• Computer science
• Biomedical and
pharmaceutical
• Neuroscience
Top professors serve as NFC advisory
board members
INVESTMENT OPPORTUNITY
HIGH RESEARCH INTENSITY
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12. INDUSTRY FOCUS
Areas Where MT Research and Entrepreneurs Excel1
Software Healthcare Photonics Bio-Sciences Agriculture
Sciences
CONTEMPLATED PORTFOLIO CONSTRUCTION
Target 12-14 Portfolio Companies, target number will
vary with final size of Fund
Expect up to $1M in initial investment with $1-2M
total/deal
Work to syndicate with quality firms and/or invest with
leading industry execs
Strive for initial ownership of 10-15%
LP co-investment may exist on per deal basis
Will consider secondary share purchases via founder
shares buyout
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NEXT FRONTIER CAPITAL
STRATEGY
1: Illustrative list

13. FIRST INVESTMENT – SiteOne Therapeutics
• Deal
– July, 2015 NFC led SiteOne’s $1.2m Series A-1 and joined the board.
– Invested $400,000 NFC capital
– Syndicated $800,000: insiders and co-investment by others
• Summary Overview
– SiteOne is a biotech company developing novel therapeutics to treat acute
and chronic pain without the limitations and side effects of existing
therapies, such as NSAIDs and opioids.
– With the success of its drug platform, SiteOne will serve as a needed
substitute to OxyContin, Vicodin, and other habit forming chronic pain
analgesics. Founded and staffed by Stanford faculty in chemistry and pain
management, SiteOne is based in Bozeman and led by Stan Abel, with a
chemistry lab in SF.
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14. SECOND INVESTMENT – Submittable
• Deal
– November, 2015 NFC led Submittable’s $1.34m Series A and joined
the board.
• Summary Overview
– Submittable is a Missoula-based, SaaS company with a general purpose,
highly efficient and easy to use platform to manage submissions of creative
content, foundation grant requests, job prospects, etc. Their prospective
client base is any organization soliciting multiple submissions for specific
assignments.
– Submittable has strong customer metrics, a history of profitable, capital
efficient revenue growth, and a horizontal application with over 2,700 clients
and 1.2 million submitters across multiple industries.
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15. THIRD INVESTMENT – CLEARAS
• Deal
March, 2016 NFC joins Clearas $4m Series B, investing $750,000 capital. Lead
investor – Cowles Company, numerous co-investors including Goodworks Ventures.
• Summary Overview
– Clearas, a Missoula, MT company developed advanced technology for
reducing nutrient levels – phosphorus and nitrogen – in industrial and
municipal sewage effluent.
– Reducing phosphorus to near zero, at scale, with no sludge or toxic by-
products is hard to do. The company’s patented, modular technology is
cheaper and environmentally/functionally superior to the existing state of
the art. It is the only such technology able to exceed EPA’s newly tightened
standards for lowered nutrients in effluent.
– Profitable by-products include fish food, fertilizer and bio-degradable
plastics.
– Huge, dynamic nutrient reduction market of $9.5b growing at 10% CAGR
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