Corporate Presentation
December 2017
DisclaimersCertain statements contained in this presentation constitute “forward-looking statements”. All statements other than statements of
historical fact contained in this presentation, including, without limitation, those regarding the market opportunity of the Company’s
products, capabilities of the Company’s products, Company’s future financial position and results of operations, strategy, plans,
objectives, goals and targets, and any statements preceded by, followed by or that include the words “believe”, “expect”, “aim”, “intend”,
“plan”, “continue”, “will”, “may”, “would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or similar expressions or
the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the
Company’s expectations, estimates and projections regarding future events. These statements are not guarantees of future
performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially
from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results,
performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company’s annual
MD&A for the year ended December 31, 2016 which is available at www.sedar.com.
Management provides forward-looking statements because it believes they provide useful information to investors when considering
their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the
forward-looking statements made in this presentation are qualified by these cautionary statements and other cautionary statements or
factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially
realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as
of the date of this presentation and the Company assumes no obligation to update or revise them to reflect subsequent information,
events or circumstances or otherwise, except as required by law.
Cautionary Note Regarding United States Securities Laws
This presentation does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities of
the Spectra7 Microsystems Inc., in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction. The securities of Spectra7 Microsystems Inc. have not been and will not be
registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws and may
not be offered or sold within the United States or to, or for the account or benefit of, “U.S. persons, “as such term is defined in
Regulations under the U.S. Securities Act, unless an exemption from such registration is available2
Spectra7 Overview
• High performance analog semiconductor company targeting high value, high
growth markets with patented advanced signal processing technology
• Headquartered in San Jose, California.
4From
bulky data, audio,
power & video
cables.
1To
Ultra-thin and
light-weight
interconnect.
Spectra7 makes electronic products
smaller, lighter, and faster.
3
Share Structure and Key Statistics
Share Price $ 0.41 CAD*
Market capitalization $ 66.6M CAD*
TTM revenue (00/30/17) $ 8.7 M
TTM gross margin (09/30/17) 59%
Insider ownership 4.5% Est.
Shares %
*As of 09/30/17 Market Close
See disclaimers on slide 2
Listed as SEV
Common shares issued 163 M 100
4
Investment Highlights
Focused, targeted go-to-market strategies fuelling business momentum
New transformative design win pipeline with industry leaders in AR/VR/MR
Encouraging market acceptance and testing of Data Center products
Growing presence in the Blockchain space
Operational efficiency programs supporting improved margin performance
I
II
III
IV
V
See cautionary notes on page 25
Spectra7 Team
Dr. Andrew KimCTO & VP,ENGINEERING
20 Years Experience: Samsung, Intersil
Raouf HalimCEO
CEO icClarityCEO Mindspeed Technologies
32 Years Experience
Darren MaCFO
15 Years Experience in FinanceIntel, Semtech, GigPeak
John MitchellCHIEF MARKETING OFFICER20 years of Product Marketing:
Intersil, Quellan
Antony Ng YukshingVP, OPERATIONS
23 years Semiconductor Engineering Cypress, Marvell
Ebrahim AbunasrahVP, INTERCONNECT PRODUCT
GROUP10 years Product Development
Molex
Gerald HamiltonSENIOR VP, WORLDWIDE SALES
27 Years Semiconductor Experience: Mindspeed, Conexant
High Gross Margin / Single Sourced / Secured by over 50 Patents
The Leader in Active Copper Cable Technology
7
Augmented/ Mixed Reality
Data Center & Blockchain
Virtual Reality
Spectra7 Target Markets: High Value, High Growth,
Disruptive Technologies
1-Estimated Hardware Revenue from Digi Capital(2016)
2- Gartner (2016)
$6 billion by 20201
3D gaming- Immersive Content -VR social
platforms
$4 billion market in 20192
Cloud Infrastructure - Cryptocurrency – Blockchain
processing
$42 billion by 20201
Workplace collaboration-Virtual desktop Increased
productivity- Job training
8
9
Spectra7’s Target Markets
AR/VR/MR
Data Center
Blockchain
• Introducing Disruptive Technology
• Explosive Growth Potential
• High Margin Opportunity
Source: Ovum
New Design Driving Growth: DreamWeVR™
Spectra7’s 4 new chips featuring
SpectraLinear™ technology enabling
AR, VR, and MR devices to drive
resolutions of 4K / 5K with low latency
over an ultra-thin unified interconnect.
Potential Applications for Spectra7’s
ultra-thin wearable interconnects:
• UHD Video
• Data Control
• Gesture recognition
• Gyro interface
Up to 50 Gbps10
11
Spectra7’s VR/MR Market Leadership Position
• $299 price point set by
Windows10 MR is driving
increased adoption
• Initial Valve and Microsoft
Games coming to Win10
for Holiday Sales and
Chinese New Year
• Record Content and
Software investments in
2H17 will drive robust
hardware sales in 2018
and beyond
Poised to Enter Data Center Market
Glo
bal D
CI R
even
ue, $M
Multi-slot Small Form Factor
Ovum,
2016
Data Center Interconnect Optical Revenue
58.5% CAGR
12
Spectra7 Proposition: Design Drives Value
13
Up to 10X reduction in
cable diameter
Passive cable bundle
Replacement Opportunity: Compelling Efficiency Gains
Up to 80% power reduction over fiber1
Up to 65% lower cost over fiber1
Major Recent Developments:
Collaboration with Foxconn, one of six
interconnect suppliers who serve 10 major
Data Center Operators.
Prototype orders in Q3’17.
Revenue expected to ramp in 2018.
1. Company Estimates
2. Ovum: Ovum Says it is Good to be a Data Center Interconnect Supplier (2015) 14
Data Center Architecture for Blockchain
Blockchain Architecture
Market DriversBitcoin
Crypto CurrenciesBaaS
Ethereum
Smart Contracts
Blockchain Architecture
15
Spectra7 Increases Efficiency of
Blockchain Processing
- Breakthrough Low Power
Up to 80% lower power than competing solutions.
- High Performance
Scalable interconnect solutions from 25-400Gbps.
- Low Cost
Typically 50% cost of competing solutions.
QSFP-DD 200/400G QSFP28 100/200G SFP28/DD 25/50G
16
Example Blockchain Operators & Customers
• Major Operators and
OEMs have Blockchain
Initiatives
• Cloud and Hyper-Scale
offer Blockchain as a
Service (BaaS)
• Spectra7 is teaming
with cable partners to
leverage it’s unique
patented active cable
technology.
Blockchain Landscape
17
Investment Highlights
Focused, targeted go-to-market strategies fuelling business momentum
New transformative design win pipeline with industry leaders in AR/VR/MR
Encouraging market acceptance and testing of Data Center products
Growing presence in the Blockchain space
Operational efficiency programs supporting improved margin performance
I
II
III
IV
V
See disclaimers on slide 2 18