U.S. Industry Coalition Building Partnerships for Prosperity

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U.S. Industry CoalitionBuildingPartnerships
forProsperity Security
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U.S. Industry Coalition

• Non-profit association founded in 1994 to support
  nonproliferation national security goals of
  Initiatives for Proliferation Prevention
• 158 U.S. industry members committed to high-tech
  partnerships in Former Soviet Union (FSU)
• Proven model as effective vehicle for technology
  commercialization

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USIC Goals

• Through technology commercialization, create new
  jobs in the U.S. and abroad
• Take advantage of imaginative, creative science
  and engineering in FSU, including closed nuclear
  cities
• Help U.S. companies and their partners bring
  innovative products to the global market

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Initiatives forProliferation Prevention

• IPP sponsored by National Nuclear Security
  Administration, U.S. Department of Energy
• IPP provides sustainable, non-weapons related
  work for former weapons scientists in partnership
  with U.S. Industry Coalition members and national
  laboratories

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IPP Program Budget

• FY04 23.2M
• FY03 22.5M
• FY02 36.0M
• FY01 24.5M
• FY00 22.5M
• IPP dollars support FSU scientists and DOE labs
• 65 to FSU
• 30 to Labs
• 5 to other (USIC, Info System, etc.)

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USIC Role InCommercialization

• OFFER fairness of opportunity
• USIC membership allows U.S. company access to
  matching government funds without time-consuming
  competitive bidding process
• FACILITATE commercialization
• expertise in technology commercialization
• business plan/investment assistance
• access to high-level officials in U.S. and FSU
• IDENTIFY potential partners
• Match U.S. and FSU institutions and companies
• DUE DILIGENCE

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Industry Cost-sharing

• USIC companies required to match 100 of IPP
  investment in their project
• Cash or in-kind contribution
• Industry match surpasses IPP dollars spent in FSU
• 1M project 650K to FSU, 350K to Lab
• Many companies invest more than required
• Today, company match meets tough scrutiny

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Industry PartnerDue Diligence

• Core competencies operational capabilities
• 3rd party background and credit quality checks
• Ability to match 100 of IPP investment
• Financial statements
• Quality of in-kind match
• Inflated compensation?
• Unreasonable expenses?

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Proposal Review

• Quality of Proposal/Business Plan
• Ratio of Market Size to Requested Funds
• Value-added potential
• Job creation potential

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FY03 Successes

• FY03 Revenues/Sales
• 20.6 Million for 17 U.S. companies
• 9.3 Million for 19 FSU partners
• FY03 benefits to FSU partners
• 1,038 jobs created or sustained
• Six new independent companies created

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Investment Growth

• Substantial private capital raised by USIC
  members since 1999
• 106M in equity, investment loans, etc.
• Novak Biddle
• Polaris
• Credit Suisse
• Angels
• Equity markets

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Small Business Financing

• Search for investors business partners
• Business Plan review
• Active networking on behalf of USIC member
• Linking with prospective funders
• One dozen personal meetings arranged
• Over 200 contacts with potential funders

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Highlights of USIC-IPP Accomplishments

• Number of outside investors demonstrates high
  competitiveness of FSU/USIC technologies
• 25 technologies now commercialized
• Dozens more in pipeline
• 7,600 scientists now supported on T2 projects
• 14,600 scientists at 180 FSU institutes or
  spin-off companies engaged since 1994

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A Decade of Results

• IPP is creating new, sustainable jobs for WMD
  personnel in Russia, Ukraine, Kazakhstan
• Adding new jobs to U.S. economy
• Reducing risk for U.S. high-tech business
• Attracting significant private investment to new
  technologies
• Demonstrating unusual public-private partnership
  with tangible results in nonproliferation and
  national security

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Increasing Demand

• 36M peak funding in FY02 reduced to 23M
• At least 30 draft projects on hold
• Examples of technologies in funding pipeline
• Hand-Held Explosives Detector
• Nuclear Waste Clean-Up
• Ceramic HEPA Filters to control dangerous
  contaminants
• Breast Cancer Diagnostic System
• Digital Video Transmission System
• Waste-Free Recycling of Scrap Tires