The document outlines 10 lessons learned from David Tester's experience founding Air Semiconductor from 2005 to 2010. It discusses the importance of having a clear vision, including additional launch markets in strategies, building a strong team, getting early adopter customers, accepting long development timelines, spending funds carefully, ensuring reference customers for investors, the myth of stealth mode, learning from founder peers, and accepting the fear and uncertainty of startups. It also provides links to additional information on Air Semiconductor's website and founder blog.

1. In Need of Air
Lessons from Air Semiconductor, 2005 to 2010
David Tester
Founder, Air

2. In Need of Air
Lessons from Air Semiconductor, 2005 to 2010
Ten Lessons from Air
(…with more lessons I’m happy to share privately)
Lesson #1 Figure out the ‘Big Vision’ and then just get started!
#2 Include additional ‘launch’ market in the go-to-market strategy
#3 Take the time to build a strong team … quality people are essential
#4 Get an early adopter ‘architecture license’ customer
#5 Just accept it will take 4 years to create initial (system level) product
#6 Spend every $1 as if it’s the last $1 … and get used to that experience
#7 Be sure some early customers can be referenced by investors
#8 ‘Stealth Mode’ is a myth … your investor pitch will go to competitors
#9 Your founder peers will share their experiences with you, so just ask…
#10 You will quickly get used to the start-up fear, uncertainty and chaos!
Air Founder Blog ‘In Need of Air’: http://blog.ex-air.co.uk/
Air Website: http://www.ex-air.co.uk/air_website/index.html
Air History: http://www.crunchbase.com/company/air-semiconductor/
Email: david.tester@structured-custom.com Tel: +44 7958 052933

3. Sell Tesco’s car park to Sainsbury’s
Car park
Special offers at
Sainsbury’s today!
Press # for directions
1_.@ 3
DEF
2ABC
Location targeted advertising is only possible with
4GHI 6 MNO
5
7
‘Always-ON’ positioning in mobile phones
PQRS
JKL
9 WXYZ
8TUV
#
* 0+

4. ‘Always-ON’ GPS
The Key to Proactive Location Based Services
Nokia 6233 Motorola RAZR V3i Samsung E900 SEMC K610im LG KG800 Chocolate BenQ-Siemens SL91
Minimum standby Minimum standby Minimum standby Minimum standby Minimum standby Minimum standby
current: current: current: current: current: current:
2.1 mA 2.4 mA 3.6 mA 2.6 mA 4.0 mA 3.1 mA
Average current*: Average current*: Average current*: Average current*: Average current*: Average current*:
7.3 mA 7.8 mA 8.3 mA 9.4 mA 8.3 mA 9.9 mA
* Current draw based on “average” use assuming battery recharge once every 4 days
How often does phone battery needs to be recharged if GPS active?
GPS must be limited to 1-2mA (or 10% of phone power)
Consumers need almost-instant response; push-to-fix delay of 1 second
Must maintain awareness of location since GPS does not work indoors !

6. Initial Market: Digital Camera Market and Geotagging
GPS enabled DSC's DSC shipments
160 M 164 M
150 M 155 M
146 M
62 M
38 M
22 M
9M
2008 2009 2010 2011 2012
GPS modules developed by DSC partners

7. GPS 101
Receive Power is -130dBm to -160dBm … 20dB to 50dB below the Thermal Noise Floor!
Earth radius 86 k
m
35,7
6,378 km
km Geo-stationary
100
19, Regional geo-stationary
augmentation satellites
0 km
20,20 WAAS
Wide Area Augmentation System – USA
EGNOS
23,222 km European Geostationary Navigation Overlay
System – Europe
GPS
6 orbital planes; 55° to equator Galileo
Moon
Galileo Approx. 400,000 km
3 orbital planes; 56° to equator
GLONASS
GPS
3 orbital planes; 65° to equator Orbit 11 hours 58 minutes
13,900 km/h
GLONASS

8. The Air Team
David Tester Hugh Thomas
Founder & CTO CEO
Steve Graham Andy Heaton Hank Izumi
Co-Founder & VP Marketing VP Operations VP Sales Asia
RFIC Design System Design ASIC Design Software Design
Staff Staff Staff Staff
Employee #1 (20 years experience) Employee #3 (20 years experience) Employee #4 (10 years experience) Employee #7 (20 years experience)
Employee #2 (20 years experience) Employee #1 (20 years experience) Employee #5 (15 years experience) Employee #8 (15 years experience)
Employee #6 (15 years experience)
Contract Contract Contract
Contract #1 (15 years experience) Contract #3 (20 years experience) Contract #8 (20 years experience)
Contract #2 (15 years experience) Contract #4 (20 years experience) Contract #9 (15 years experience)
Contract #5 (20 years experience)
2x Synopsys IC layout contractors
Board of Directors Support Staff
Hugh Thomas CEO ex-CEO TapRoot 1x General Admin
David Tester CTO 1x Finance Manager
ex-CEO Andromedia (acquired Macromedia ‘99)
Kent Godfrey Pond Ventures
ex-CEO Frictionless Commerce (acquired SAP ‘06)
Michael Gera Pond Ventures
ex-CEO PortalPlayer (NASDAQ: PLAY)
Gary Johnson Independent ex-CEO S3 (NASDAQ: SIII)

9. Initial Idea (in 2005) to Prototype Silicon (in 2009)
Dual-Mode GPS
system design
SPECIFICATION
Dual-Mode GPS COMPLIANT
software design GPS RECEIVER
Acquisition DSP $1M Bridge Finance
Tracking DSP Architecture September ‘08
Architecture $1M Bridge Finance
Tracking DSP June ‘09
Tracking DSP Implementation
Implementation $1M Bridge Finance
Acquisition DSP February ‘09
Implementation
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F
Radio IC Radio IC A1250
A1250 silicon evaluation
Implementation Implementation IC design
Tracking DSP Air tracks GPS satellites with RFIC
Architecture March ‘08
PVT & RFIC + FGPA platform
First VC Meeting… Kalman Filter May ‘08
February ‘06
Air tracks GPS satellites with RFIC + FPGA
A1225 RFIC (v1) June ‘08
$1.25M Series-A1 Termsheet April ‘07 Air first PVT, confirms lab in Swindon
September ‘06 June ‘08
A1225 RFIC (v2)
A1250 single die GPS receiver
February ‘08
January ‘09
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F
2006 2007 2008 2009
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F
Electra Start-Up of the Year 2008
November ‘08
Gary Johnson joins Board of Directors
2x NASDAQ CEO (PortalPlayer & S3) IET Start-Up of the Year 2008
May ‘07 November '08
Prof Izzet Kale joins Technical Advisory Board
October ‘08
Engage with TSMC for silicon
Sept ‘06
Demonstrate GPS technology
July ‘08
Development starts!
June ‘06
Recruit external CEO Sell Air Patent Portfolio to u-blox
May ‘08 February ‘10
Air Inc + Ltd incorporated
May ‘06 Red Herring 100 Europe 2008
April ‘08
$1.75M Series-A Termsheet $3.8M Series-A2 Termsheet
April ‘06 November ‘07 Exit stealth mode
Announce 1st product
January ‘08

10. airwave1 system development platform
and prototype sample silicon module

11. Air Technical Demonstration Platform … in Japan

12. Air Technical Demonstration Platform … in USA

13. GPS with airwave1 silicon

14. Prototype Product Performance
Unfiltered CEP50 position accuracy is 2.8 metres
CEP50 position accuracy with Kalman Filter <2 metres
Push-to-Fix TTF @ -130dBm: 2.5s
Push-to-Fix TTF @ -150dBm: 2.5s
(Future push-to-fix TTF could be <1s)
Unaided cold start: -140dBm
Unaided hot start -150dBm
(Future hot start sensitivity -154dBm)
Tracking sensitivity: -152dBm
(Future tracking sensitivity -160dBm)
Plot shows 20m (x axis) by 20m (z axis)
Positions grouped into 20cm x 20cm bins
Stationary receiver over 12 hour period

15. Air Prototype SOC GPS Receiver Performance
Exceeds ‘Push-to-Fix’ Requirements for LBS Market

16. Air Prototype SOC GPS Receiver Performance
Lowest Power, Lowest Die Area GPS Radio (2.1mm2 10.7mW)

17. Monthly Burn ($K)
$100
$150
$250
$300
$350
$400
$450
$500
$550
$600
$200
$50
$0
Jun…
Jul…
Aug…
Sep…
Oct…
Nov…
2006
Dec…
Jan…
Feb…
Mar…
Apr…
May…
Jun…
Jul…
Aug…
Sep…
2007
Oct…
Nov…
Dec…
Jan…
Monthly Burn $K
Feb…
Mar…
Apr…
May…
Jun…
Jul…
2008
Aug…
Sep…
Total Burn $M
Oct…
Nov…
Dec…
Jan…
Feb…
Mar…
Apr…
May…
2009
Jun…
Air Operating Costs - 2005 to 2010
Jul…
Aug…
Sep…
$0
$1
$2
$4
$5
$6
$7
$8
$9
$3
$10
$11
Total Burn ($M)

18. Customer Status: 174 Active Customer Leads
Markets:
Camera, Cellphone, Laptop PC, Netbook, Digital Watch, Asset Tracking
37 active leads generated proactively by Air
Including: Ability; Apple; Canon; Casio; DoCoMo; Foxconn; Fujifilm; LG; NEC; Nikon;
Nokia; Olympus; Panasonic; Pentax; Ricoh; Samsung Electronics; Samsung Techwin;
Sanyo Digital Imaging; Sony Ericsson; Softbank; Sony
20 active leads from VC introductions
Including: Google; Motorola; O2; Spreadtrum; Swatch; Vodafone
117 unsolicited enquiries resulting from PR activity
Including: Mediatek; Microsoft; RIM; Altek; Fujitsu; Hitachi; HTC; Mitac; Compal
Proactive
VC Introductions
Unsolicited enquiries

19. CSR / SiRF follow Air Semiconductor ‘Always-ON’

21. In Need of Air
Lessons from Air Semiconductor, 2005 to 2010
Ten Lessons from Air
(…with more lessons I’m happy to share privately)
Lesson #1 Figure out the ‘Big Vision’ and then just get started!
#2 Include additional ‘launch’ market in the go-to-market strategy
#3 Take the time to build a strong team … quality people are essential
#4 Get an early adopter ‘architecture license’ customer
#5 Just accept it will take 4 years to create initial (system level) product
#6 Spend every $1 as if it’s the last $1 … and get used to that experience
#7 Be sure some early customers can be referenced by investors
#8 ‘Stealth Mode’ is a myth … your investor pitch will go to competitors
#9 Your founder peers will share their experiences with you, so just ask…
#10 You will quickly get used to the start-up fear, uncertainty and chaos!
Air Founder Blog ‘In Need of Air’: http://blog.ex-air.co.uk/
Air Website: http://www.ex-air.co.uk/air_website/index.html
Air History: http://www.crunchbase.com/company/air-semiconductor/
Email: david.tester@structured-custom.com Tel: +44 7958 052933