Kudan - Growth potential

1. Kudan (4425, TYO)
©Kudan. All Rights Reserved.

2. Company overview
©Kudan. All Rights Reserved. 2
Name Kudan Inc.
Est. November 2014
Location
Shinjuku, Shinjuku-ku
Tokyo
Segment Artificial perception
Capital Not public
Offices Tokyo, Japan; Bristol, UK
CEO
Tomohiro
Ohno
Andersen Consulting (now
Accenture) prior to founding
Kudan
CTO
(Kudan
Limited)
John
Williams
Independent researcher
(embedded computer vision)
CFO Ken Iizuka ShinNihon Co., Ltd. (current
Ernst & Young Shin-Nihon LLC)
COO Daiu Ko Toyota, McKinsey & Company
ManagementOverview
Company Business
Research and development, and provision of algorithms and embedded
technologies for Artificial Perception that gives vision to computers and
robots.

3. Performance overview
©Kudan. All Rights Reserved. 3
88
204
376
650
△ 90 (-101.9%)
4 (2.0%)
103 (27.5%)
213 (32.9%)
△ 200
0
200
400
600
800
FY2016 FY2017 FY2018 FY2019forecast
Reveue Ordinary Profit (margin)
Revenue/Ordinary Profit (Units：JPY millions)

4. ©Kudan. All Rights Reserved. 4
Artificial Perception
Artificial Intelligence
“Brain” to make decision
Artificial Perception
“Eyes” to perceive the world
＝＝
“Eyes = Artificial Perception” and “Brain = Artificial Intelligence” works
complementally as the most important technology elements to realize autonomous
functionalities for computers and robots

5. ©Kudan. All Rights Reserved. 5
Artificial Perception (details)
Visual processing (3D and kinesthetic sense)
ALAM*2
(Asynchronous Localisation and Mapping)
SLAM*1
(Simultaneous Localisation and Mapping)
VIO*3
(Visual Inertial Odometry)
SfM*4
(Structure from Motion)
Other sensing
Depth
Inertia
Odometry
Position
×
Elemental technology group for spatial and positioning recognition

6. ©Kudan. All Rights Reserved. 6
Selected customers
 Processer IP
 Image sensor
 Industrial robot
 Heavy industry
 Transportation
 Optical deviceRobotics/IoT
AR*5/VR*6/MR*7
Auto/digital map
 Automotive OEM
 Automotive parts
 Digital map
 Map survey
 Optical device
 Appliance
 Smart-glass
 Game publisher
 EC platform
 Connection device
 Telecom
Robot cleaner Smart home Drone
CCTV Industrial
HMD Mobile Outdoor XR
Indoor XRGame
Application Selected customers
ADAS Autonomous car
Dynamic map Smart city
Navigation

7. ©Kudan. All Rights Reserved. 7
Market position
Players
 Packaging algorithms and
hardware (sensors/chips)
 Offering algorithms
(frameworks)
 Adding value through
services and
applications
 Developing automotive/
mobile/robotic products
Layers of AP
Application tech
End product
Solution
Deep tech
Cultivating
market
demand with
stakeholders
Accumulating
cross-industrial
expertise
Strategic position as Deep Tech firm focusing algorithms

8. ©Kudan. All Rights Reserved. 8
Revenue model
Partnership start
Milestone
progress
Client
productization
Client product
penetration
Track
record
 Licensing
technologies to
30+ clients
 Full client base
penetration in
Fortune 2000
class tech
companies
 Fee rate increase
for +200~300%
through
milestone
achievements
 On-time
milestone
achievements
 Fee rate increase
for 20% per year
 Shift from R&D
to commerciali-
zation for 1 out
of 10 clients per
year
 Commerciali-
zation in 30% of
total client base
 N/A
 Scaled
commercial fee
for 200+ million
JPY per project
Mid-term
forecast
Development
license fee
beginning
Development
license fee
scaling
Commercial
license fee
beginning
Commercial
license fee
scaling
Project phase in respective client
R&D Commercialization

9. Dashboard for growth estimation
©Kudan. All Rights Reserved. 9
24
32
+8
FY18 FY2019
Acquisition of new customers Ratio on stage of contract
10% 30%
Commercial
R&D
As is Mid-term
CAGR 30%~
[# of customers] [# of projects]
Revenue and cost
As is Mid-term
4 7
150Revenue
Cost
[m JPY]
As is Mid-term
80%
30%
Ordinary profit margin
[%]

10. ©Kudan. All Rights Reserved. 10
Company facts
Tech IP
Revenue
90％
Ph.D
70％
Tech
Team
Fortune
2000
50％
Costumers
Technology Expansion Talent
CPA
66％
Back office
Management
consultant
Management
50％
× ×
Users 40 countries
R&D
HQ
Kudan has established stable foundations for business and
technology as a professional firm for Artificial Perception

11. ©Kudan. All Rights Reserved. 11
Future vision
To be the “Hub for Deep Tech” by accelerating investment in other
Deep Techs underlying all industries with AP as the core
Artificial
intelligence (AI)
Brain computer
interface
Genome editing
Quantum computing
Artificial perception
(AP)
Next-gen memory/
image sensor
Edge computing
（5G - xG）
Applied technology
Product
Solution
Deep Tech
Solutions for particular issues
Foundations of all industries

12. Appendix
©Kudan. All Rights Reserved. 12

13. ©Kudan. All Rights Reserved. 13
Corporate Vision: Eyes to all machines
The evolution of organisms accelerated with the development of eyes, leading to an
explosion of diversity (the Cambrian Explosion). Kudan gives eyes to machines, promoting
progress in science, technology, and industry.
Hairyanimals
Ungulates
Echinoderms
Vertebrates
Chordates
Hemichordates
Urochordate
cephalochordates
Priapulida
Sipuncula
Echiura
Brachiopods
Bryozoa
Phoronids
Pentastoma
Tardigrada
Annelid
Onychophora
Polypod
Arachnids
Insects
Chitons
Cephalopod
Paleopod
Gastropods
Acanthocephala
Entoprocta
Rotifera
Kinorhyncha
Gastrotrich
Nematodes
Nematomorpha
Mesozoa
Cyclostomes
Platyhelminthes
Nemerteans
Cnidarians
Ctenophora
PLACOZOA
Sponges
Arthropods
Molluscs
DeuterostemiaProtostemia
Coelomates
Bilateria
Echinoderms
Parazoa
Eumetazoa
Protozoan ancestors
Emergence of sight (trilobites)

14. ©Kudan. All Rights Reserved. 14
Milestone achievements and monetization
We have been achieving milestones of Deep Tech R&D on time to effectively
monetize our technologies in advance of our customer’s product launches
Enabling advanced robotic
autonomy through
integrating AP and AI
6DoF perception organically
coordinates each other to
realize digital map for machines
Providing advanced
space recognition
capabilities as core
embedding components
AP(Eyes)
AP + AI(Brain)
AP + AI + IoT(Neural net)
GigaPoint
Map
SLAM enabled
classification
LiDAR
fusion
Machine/ Deep
Perception
Crowd
Sourcing Map
Semantic Map
Restructuring
Neural Perception
Network
Ubiquitous
Sensor Fusion
RDB-D
SLAM
Monetizing R&D activities
through achieving
milestones

15. ©Kudan. All Rights Reserved. 15
Predictions of Market Expansion
Artificial perception will support diverse technologies and will be
used in a broad array of fields
With growing use of AP, the total market for
related applications is expected to reach
around 10% for elemental technologies
Application market forecast (2023) Technology market forecast (2028)
Sources: IHS Markit, Statista, Global Marketing Insight, HTF Market Intelligence, Markets and Markets, Transparency Market Research, Machina Research
*: 110 yen used for exchange rate
15％+
161B yen
AP application-related
markets
22B yen+
10％+
1,140B yen
AI・IoT-related
markets
114B yen+
With greater integration between AP and
AI/IoT, the total market for visual and
image-related applications is expected to
reach around 10%
2023 2028
※ ※
Visual/Image RelatedFoundational Technology
Breakdown of AP applications: smartphones, AR/VR, self
driving autos, industrial robots, drones, material handling,
digital maps, smart appliances