Leveraging R&D through Venturing

1. Leveraging R&D through Venturing Saabs Focus Saab Strategic Business Planning Process Objectives Business Concept Organization Business Process Performance Ten Success Factors

2. Spin-offs (Venture Capital Council) Value realization through divestment or development in partnerships with others Main business focus. Source of new opportunities forgrowth and acquisitions Core business Support strategy Constant generation of new ideas for utilizing defence technology in non-defence applications Commitments with Airbus and Boeing. Resources and capabilities that exist within the company and development of competencies that can be utilized in military aircraft Saab’s focus Defenceelectronics Focus areas High-technologyservices Systemsintegration

3. Business Plan Business Plan Business Plan Business Plan Give Direction Business Plan Review and Approve Business Plan Business Categorization Business Categorization Strategic Evaluation Strategic Business Planning Process Corp Strategic vision & req. Corp Strategic vision & req. Corp Strategic output SMO, BI VCC VCC Tech. Council Corporate Strategy Group Corporate Strategy Group Market forecast Independent business Independent business Technology requirements Business Area Strategy Business Area Strategy Business Unit Strategy Business Unit Strategy

4. Saab Venture Capital CouncilObjectives • Stimulating creative and innovative employees • Spreading businesslike thinking • Helping business units to focus on core business • Leveraging return on research and development • Exploiting existing, but nolongerstrategic, technologies • Exploiting core technologies on none core markets

5. Saab Venture Capital CouncilBusiness Concept Saab VCC contributes to profitable growth of Saab through business development and realization of hidden none core values. Saabs business areas can achieve higher performance by rewarding creativity and spreading businesslike thinking utilizing the VCC-process.

6. Saab Venture Capital Council“Organization” • Established in January 2001 • Six plus four members with a mix of financial, technical, strategic and research skills • All members working part time with VCC • Close co-operation with Saabs business areas • Reports to Saab Executive Management

7. Business Areas Preparation Pre-study Business plan Business Development New Business Area B0 B1 B2 B3 Sell Sell Sell Sell Realization of value Outside Saab* Terminate Terminate Terminate Terminate Saab Venture Capital CouncilBusiness Process • Through out the process VCC focus on: • Clear realization of value • Substantial exit value • Considerable market value • Risk vs reward • No negative effect or management burden on core business.

8. Saab Venture Capital CouncilPerformance 2001-2002 • 9 external exits • Total up front payments received: >100 MSEK • Total capital gain: >100 MSEK • Total losses saved for core business: not insignificant! • Upside value in royalties, stocks, options and additional payments

9. Saab Venture Capital CouncilTen Success Factors Link up Coporate Venturing with Business Strategy Report to, and get support from, executive management Create a small focused organisation and make fast desicions Don´t build up large internal funds The customers (the business units) are always right Kill weak projects as soon as possible Know when and how to do an exit – build networks Find a new principal with market knowledge to each spin-off Keep an upside position through stocks, options etc Be curious, flexible and natural

10. Thanks for your attention!