CIT GAP Funds

Tom Weithman

Vice President and Managing Director

CIT GAP Funds

Inn at Virginia TechBlacksburg, VA

August 18, 2011

Center for Innovative Technology

Accelerate the socio-economic growth of Virginia’s rural and underserved areas through the application and use of broadband telecommunications

Dedicated to helping large-scale federal and corporate consumers of technology identify and assimilate innovation created in private sector start-up companies. GSA MOBIS Schedule

Assists early-stage Virginia based technology companies to secure private and federal funding sources

Conducts world-class research and development programs that create new industry clusters.

CIT Entrepreneur

• Federal Funding Assistance Program

• CIT GAP Funds

• Commonwealth Energy Fund

Address the Commonwealth’s funding gap for very early stage technology companies by providing critical pre-seed and seed level capital necessary to move Virginia’s most promising and high-potential technologies from the proof-of-concept stage to the marketplace.

GAP Funds Mission

CIT GAP Funds Overview

• Family of Seed-Stage Venture Funds

• Virginia Investment Focus

• Convertible Debt Fund

• Spin-Outs from Virginia Research Institutions

• “Double-Bottom Line” Fund

• Deep Engagement with Portfolio Companies

• “Near-Equity” Instrument

• Initiates as Debt - Downstream Conversion to Equity at CIT Option

• Streamlined Deal-Making • Balances Interests of Investor and Entrepreneur

Convertible Debt Fund

GAP Investment CriteriaManagement Team / Founder Full-Time Commitment Integrity, Passion, Creativity Coach-ability Record of High Achievement

Investment Stage Seed-Stage Focus Up to 36 Months Prior to Series-A Pre-prototype – Newly-Launched

Technologies

Investment Range GAP Investment

< $200K; >$100K Tranched < $1M Concurrent Syndication < $1M Previous Financing Follow-On Investment up to $250K

Innovation Investment < $75K per Company > $50K Requires IAB Review

Proprietary Advantage Unique Technology Defensible IP Position Difficult-to-Replicate

Scalability Markets with Big Buying Power Potential for Dominant Market Position

Returns Angel -VC Multiples

Industries Technology BioLife Energy

Geographic Focus Virginia-Only

Investment Team

• Tom Weithman Vice President & Managing Director, CIT GAP Funds

• Marco Rubin Venture Advisor - CIT GAP Funds, Manager - CEF Fund • Sean Mallon Senior Director of Investments - GAP Tech Fund

• Dan Mindus Investment Director - GAP Tech Fund

• Alex Euler Investment Director - GAP BioLife Fund

• Jennifer O’Daniel Senior Investment Associate – CIT GAP Funds

CIT GAP Funds Investment Advisory Board

Venture Funds• Credit Suisse• Edison Ventures• Harbert Ventures• HIG Ventures• In-Q-Tel• Intersouth Partners• New Enterprise Associates• SJF Ventures• Tall Oaks Capital• Valhalla Venture Partners

Angel Groups• Active Angel Investors• Blu Venture Investors

Corporations• Alpha Natural Resources• GE Energy• Johnson & Johnson• Carilion

Research Institutions• IALR• NIH Office of Tech Transfer

Cashed-Out Entrepreneurs

GAP Fund Investment Strategy, FY12

GAP Fund• Historic GAP Investment Thesis• GAP Tech /GAP BioLife• Investment Ceiling: Traunched $200K• Follow-On Investment Up to $250K • IAB-Driven Decision-Making• Convertible Debt or Equity

Innovation Investment Fund• GAP “Feeder Fund”• University-Centric Investments• Tech, Life Science, Energy• Investment Ceiling: $75K• IAB-Driven Decision-Making > $50K• Convertible Debt

Commonwealth Energy Fund• Modeled after GAP Fund• “GAP Energy”• Investment Ceiling: $200K• IAB-Driven Decision-Making• Convertible Debt

Track Record

53 New Companies Seeded

7 Spin-Outs from Universities and Federal Labs

16X Private : Public Funding Secured

7 Portfolio Companies Exited

4X Named “Top 100 Venture Fund” Value Creation for …

EntrepreneursCo-InvestorsCommonwealth of Virginia