Business of Inside U(The next version of Internet )

Inside U Corp.

Agenda Internet market trend Why VR ? How to make next cyberspace Why Inside U ? Business model Risk Factors Product Product milestone Financial analysis Investment requirement Reference

Executive summary • Company Mission : Providing 3D Internet Infrastructure• Foundation Date : May 1998• Product Concept : 3D Infrastructure ( 3D Search Service, 3D EC system, 3D Homepage, 3D shopping mall price comparison system)• Number of Employees : 23• Business Model : Making profits from technology licensing & sharing advertising revenue• Company Needs : Seeking fund (Development,marketing, PR for each service)• Funding Needs : $ 10 M

Internet market trend (1)

Component Infrastructure : Backborne,ISP,Network,Server

AT&T,MCIWorldcom,GTE,,AOL,Cisco,HP,KT Application : Search,WWWDB,Multimedia,Game

Inktomi,Oracle,Netscape,Adobe,IBM

EC/Contents : EC,Portal,Entertainment Yahoo,AOL,MSN,Amazon,Ebay,WSJ

Inside U is Here !!

Internet market trend (2)

Only #1 can survive !! -> Network effect The some major company will dominate future

of our cyberspace. It explains these situation

enormous investment, M&A

Internet market trend (3) AOL-Time Warner ($170B, 2000) Internet M&A in US ( computer-currents)

$ 47 B (1999) $ 250 B (2000)

Internet M&A in Korea H&C acquire skylove ($10M) Thrunet acquire Nowcom ($35M)

Estimated internet start-up funding in korea $ 22 B (2000)

Why VR ?

Why Internet ? Do you really need it ? It’s some kind of conspiracy

Why VR ? Need more computing power & speed The only factor is changing speed

The conclusion is prior occupation Only #1 can survive !! -> Network effect

How to make next cyberspace(1)

User

PCHMD

Data Glove

ISP

EC

Portal

Contents

3D Navigation3D WWW search3D EC3D Home Page

3D service

Licensing(Each service)

High-performance PC,Hi-speed internet line

How to make next cyberspace(2) User

Personalized 3D environment

3D search

3D EC

3D stock Inf.

3D navigation

portal

3D server program

3D database

Inside U

EC

Contents

ISP

Portal’s brand3D result

queryUpdate&advertisementEach EC’s brand

3D shop mall

query

Each contents’3D stock inf.

queryEach ISP’s3D navigation

query

VR device,3D browser

Why Inside U ? (1)

Establishment : May, 1998 Capital : 2 M Inside U’s Business model

B to B, Provide 3D Infrastructure of internet application (Network effect)

Partnership : Hanmi bank, Hanaro telecom,

Mental Korea,

Why Inside U ? (2) Structure

CEO/President(1)

COO/Vice President (1)

Board of advisor (4)

Vice President of Bizdev(1)

Vice President of Marketing(1)

Management Team

Strategic PlanningTeam (7)

R&D Team (10)

Service Operating Team(5)

Why Inside U ? (3)

Inside U ‘s Product 3Dbot (3D Meta Search engine) CP3D (3D shopping mall price comparison system) Visual stock (Stock investment system)

R&D 3D Homepage system 3D shopping mall maker VR equipment (HMD, Data glove)

Why Inside U ? (4)

Inside U has VR technology Internet based. 3D Client technology, Steady server side

technology Inside U has a good management team.

Ref. Inside U has a fast exit strategy.

Launch in 3rd market in May,2000 in Korea. Have a plan to enter in to KOSDAQ market

in 2001.

Business model

3D Internet service providing (B-to-B)

Get technology license fee(each customer) Share advertising fee (each customer) Share transaction fee (in EC,stock application) Selling technology (For major company) Selling distribution right(For ISP,network company)

Business model Marketing strategy

In early stage, distribute 3D service to user traffic site freely for 3 month (in this stage ,only advertising revenue)

After proof period, we get license fee and share advertising fee (7:3) Customer has several option

(license fee : Advertising Fee)

Risk Factors

Not proven -- It’s not easy for people accept new technology.

How can we do effective marketing. In B-to-B licensing model, market is very dependent

on other companies. Changing speed of network and hardware

environment.

Product (1) - 3Dbot

User can recognize correctness by

location of objects

The circles mean search engine

number, so when object get closer to

the center , it belongs to many search

engines

The height of objects mean average

correctness of results of search engines,

so the more higher, it means average

correctness is high

User can recognize correctness by

location of objects

The circles mean search engine

number, so when object get closer to

the center , it belongs to many search

engines

The height of objects mean average

correctness of results of search engines,

so the more higher, it means average

correctness is high

Characteristics Characteristics

objectobject

Product (2) - CP3D

User can find the best price of goods

by comparing price

To suggest merchant popularity and

price range at same time

With 3D graphics, it is more interesting

than others.

User can find the best price of goods

by comparing price

To suggest merchant popularity and

price range at same time

With 3D graphics, it is more interesting

than others.

Characteristics Characteristics

Product (3) - R&D• 3D Visual stock : 3D type stock investment system Prototype service was made already.

• 3D home page : User can make 3D home page step by step on WWW like Tripod. The result home page is 3D home. Service starts from May,2000.

• 3D EC shopping mall : User can make 3D shopping mall on WWW like 3D homepage service

above. Service starts from July, 2000.

• VR Device : HMD(Head-Mounted Display), Data-glove

Product Milestone 1,2 3,4 5,6 7,8 9,10 11,12

3Dbot

CP3D

3D H.P

3D e-shop

License free,Adv. fee

License feeshare Adv. fee

License free,Adv. fee

License feeshare Adv. fee

License free,Adv. fee

License feeshare Adv. fee

License free,Adv. fee

License feeshare Adv. fee

Financial Analysis (1)

• Revenue Projection

YearProducts

2000 2001 2002

3Dbot 3.7 7.4 14.0

CP3D 2.3 6.9 20.0

Visual Stock 2.5 7.0 15.6

3D H.P 1.3 3.9 11.7

3D E-shop 1.4 4.2 12.8

Total 11.2 29.4 74.1

Unit : Million

Financial Analysis (2) Advertising 2000 2001 2002 3Dbot $2,000,000 $3,000,000 $4,000,000 CP3D $1,000,000 $2,500,000 $5,700,000 3D H.P $1,000,000 $2,600,000 $5,500,000 3D E- shop $1,000,000 $2,400,000 $5,000,000 Visual Stock $1,200,000 $2,600,000 $5,500,000 Total $6,200,000 $13,100,000 $25,700,000

Distribution Selling 2000 2001 2002 3Dbot $1,700,000 $4,400,000 $10,000,000 CP3D $1,300,000 $4,400,000 $14,300,000 3D H.P $1,200,000 $4,000,000 $14,500,000 3D E- shop $1,000,000 $3,600,000 $13,000,000 Visual stock $1,300,000 $4,400,000 $10,100,000 Total $6,500,000 $20,800,000 $61,900,000

Investment Requirement

(Each include development, marketing,PR fee)

Item Amout ($)

Corporate Branding 1 M

US Branch 2 M

3Dbot 1 M

CP3D 1 M

3D EC mall 1 M

3D Home Page 2 M

Visual stock 1 M VR device 1 M

Reference (1)

• Management teamWoo-Seop, Sim - CEO/PresidentThe CEO, Woo Seop Sim, has been studying virtual reality since 1993.He is widely known in the Korean software industry in general,not to mention in the field of virtual reality. In Samsung SoftwareMembership, where he first met the people who are now participatingin our company, he was the chief of Virtual Reality Department.He wrote many articles in the nation’s famous software journals.He graduated from Sung-kyun-kwan university with a major in electronics in Korea.

Reference (2)

• Management team

Ki-Suk Chung - COO/Vice PresidentJung joined Inside U in late-1999 as vice president and COO.Prior to joining Inside U, Mr. Jung worked in the internet-basedcompanies such as 3W Tour, Netro21, and cred-link etc.,wherehe led the management-supporting, corporate-financing, andcontents-creating teams. Mr.Jung had also employed bythe Korea Credit Gurantee Fund for about 6 years. Mr. Jung holdsa bachelor and master degree in geology from Korea University.

Reference (3)

• Management team

Steve Jang - Vice president of biz developmentMr.Jang, a consultant, have carried out the management, education,and translation-related jobs at KMI in San Jose, California since 1995.Prior to KMI, Mr. Jang provided information technology consulting services to small and medium businesses at Bencom Information Systemsin Los Angeles, California. Mr.Jang also worked in InternationalBusiness Machines Korea Inc. to coordinate with IBM Japanfor the product development project. Mr.Jang holds an MBA fromuniversity of California at Berkeley.

Reference (4)

• Management team

Mike Oh - Vice president of Marketing- Pidea,Inc. (South San Francisco, CA) President 1993- Present- Dawn enterprise,Inc. (Emer ville, CA) Vice president 1992-1993- JSK International,Inc. (South San Francisco, CA) Vice president 1989-1992- Raphael international,Inc. (Hayward, CA) Marketing director 1984-1989

Reference (9)

• Stockholders

Shareholders Stocks Ownership

Sim, woo seop 152,034 34.1%

Small shareholders 293,067 65.9%

Sum 445,101 100%

Reference (10)• Company milestone

0 2 4 6 8 10 13 14 16

Providing 3D portal service

HMD support

3Dsound support

Inside U (server side)

The haptic system

Hologram

Nervous current & Hormon