1. Industry Partnerships Cascade Designs Inc. Day One Response, Inc. Sustainable Vision Workshop 3/22/2011

3. Background: Day One Response

4. Case Study: SE200 Electrochlorinator

5. Partnering Strategies

6. Case Study: Day One Waterbag

7. Partner Selection Criteria and Pitfalls

8. ConclusionsAgenda

9. Under the brand names Mountain Safety Research (MSR), Platypus, and Therm-A-Rest we are recognized as the technical and market leader in hydration systems, hand-held water purifiers, lightweight camp stoves, cookware, sleep pads, and snowshoes. MSR & SweetWaterPurifiers MSR Tents MSR Stoves Denali Snowshoes Therm-A-Rest Sleep Pads Platypus Hydration Systems

11. Cascade Designs has over 5,000 Outdoor retail accounts in the U.S. and sales agents in over 40 countries around the world.

13. On the commercial side of our business, market pressures require us to have something new at the trade show every year.

14. Government funded development efforts enable us to “swing for the fences”, and partner with universities and technology firms to research cutting-edge technologies.$ $ Valley of Death Product Revenue DoD Funding

15. Day One Response Background “Providing clean drinking water is our #1 challenge in disaster zones.” -Steve Rieve, American Red Cross Cal Poly State University & DayOne Response, Inc.

16. The DayOneWaterbag™ All essential functions in one unit: Easy Collection Under difficult conditions Transport Backpack straps are comfortable Treatment Dirt, Cysts, viruses, bacteria removed Storage and Dispensing closure prevents re-contamination

18. DayOne Response, Inc. founded April 2010 with guidance from Innovation Quest and NCIIA

19. Partnership with Cascade Designs, Inc. and US Naval Facilities Engineering Command

20. Working with P&G’s Children’s Safe Drinking Water program to expand the use of PUR in disasters and other development settings.

22. CDI Water Purification Technologies Map Access to cutting-edge technologies has given CDI the opportunity to evaluate the full spectrum of water purification technologies for use in the Base of the Pyramid markets. Applied Energy Physical Separation Chemical Treatment MIOX PATH Particle Filtration (Sieves) Oxidant Dosing Sefar MIOX Sweetwater Electro-Chlorination Lemelson Quartek Laird- Norton Metal Ion Treatment Hollow Fiber MSR One Drop Gates Apaclara PATH Ceramic Candle Filters Forward Osmosis Capacitive De-ionization TDA Research Oasys MSR HTI MM Media Resintech Solar Radiation Ion Exchange Adsorption Puralytics Purolite Calgon ORICA Biomin Cal Poly University Halogenated Resin Precipitant Dosing Halosource Light Year

26. Products need to be designed for the end user.

27. Logistics are critical.

29. Seattle is a center for global health initiatives (Gates Foundation, PATH, World Vision, etc.).

30. DoD-funded efforts have given CDI access to cutting-edge water purification technologies.

32. MSR MIOX Purifier launched to the outdoor market in November 2003. Became the #1 selling Purifier in its first year on the market.

34. The capital and operating costs are much lower than other small community water purification options.

35. Disinfectant is created fresh for each use. [No shelf life issues].

37. Bill Varnava, the project officer on several of CDI’s military funded R&D efforts, is a Cal Poly alumni, and recommended that CDI consider working with the University on a Senior Project.Naval Base Ventura County (Port Hueneme, CA) The Seawater Desalination Test Facility (SDTF) provides research, development, test and evaluation, and training support for water purification equipment.

38. Senior Design Project Cal Poly Electrochlorinator

40. Students explored alternative design concepts and technical approaches.

41. Student team investigated innovative manufacturing processes.

43. Strong project manager at Cascade Designs. [Design lead worked with the student team]. Willingness to invest time and resources to support the student effort.

44. Cal Poly students were smart and motivated to succeed.

46. Study the requirements for rural small-community water purification systems. Gather field data.

47. Evaluate sustainability (micro-finance water kiosk entrepreneur economic model).

48. Leverage existing government funding. [Evaluate new materials, power supply options, etc.].

49. Position the CDI/PATH/Day One team to participate in new humanitarian and disaster relief efforts. [Operation Crimson Viper].

51. 5% Technology - 95% All the other stuff Business models Cultural factors User experience Financing Ease-of-use Distribution Supply chain Maintenance Cost

52. Technology Transition Engineering Marketing Sales Admin. Operations Quality

53. Technology Scale-Up Cascade Designs Inc.

54. Case Study: DayOne Waterbag, Scaling and Partnerships Iterations (2007-2010) Product (2011) Concept (2007)

55. Waterbag 2007-2009 Nicaragua 2009

56. Waterbag 2010-2011 Crimson Viper, Thailand, July 2010

57. Waterbag 2010-2011 Haiti, March 2011

58. Waterbag Next Steps…

59. Partnering Selection Criteria What factors does Cascade Designs consider when evaluating potential industry or University partners? Technical Advantage – Does the product concept have a competitive advantage over the existing COTS products. Passion – Does this team have the vision, talent and commitment to get the job done? Business Compatibility – Are the business interests aligned? Synergy – Does this opportunity fit in with other existing development projects or strategic objectives? Distribution Fit – Can we sell the products resulting from this effort into one of our existing markets? Manufacturing Fit – Can we produce the future products with our existing manufacturing capabilities? I.P. Protection – Is defensible I.P. protection available? Risk – What are the potential risks vs. rewards? Operation Crimson Viper Field Testing

61. Lack a clear understanding of the target markets and competitive landscape.

62. Unrealistic expectations regarding the value of their idea. [Std. royalty Outdoor market: 2-5% net profits].

63. Unable to identify a “Champion” within their key distribution channels. [Believe that a better mousetrap just sells.].

67. Need to identify which DoD/government agencies are relevant to our cause. [“Map the foodchain”].

68. Set up meetings with contacts in key HADR agencies. Brief them on our active and planned development projects. [“Connect the dots”].

69. Find the best ways to channel our strong corporate and political support.

72. 30 kg salt per 40,000 liters of water ($4)

73. charge 12V car battery each 40,000 liters ($1.30 at a charging station1)

74. Raw water

75. Capital costs:

76. SE200 ($100 wholesale cost target)

77. 12V 80 Amp-hour battery ($100)

78. Total Capital Costs: $200

79. Operational cost per 1000 liters: $0.131 Electricity battery charging cost is based on charging station price. It would be less if the operator has access to electricity and does not need to go to a charging station.

80. Development Business Model (Aquaya)

81. Comparison of oxidants (operational costs)

82. Field Trials December, 2008: Kenya Kenya, installation of a 20 L electrochlorinator. Collect initial operator/training feedback June, 2009:Kenya Kenya, revisit 20L installation Hold focus groups on 200L alpha prototype Collect qualitative feedback Spring/Summer, 2010: Ghana, Kenya, Zimbabwe Set up first SE200 water kiosks Carry out quantitative microbial studies in households Collect operator and customer feedback Develop preliminary financial model July, 2010: Disaster Response Exercise in Thailand Simulated disaster scenario Train Thai Marines to operate the SE200 Compare to 5 other disaster relief water technologies

84. CDI and PARC have complimentary core strengths.

85. CDI’s in-house manufacturing engineering, prototyping and LRIP production capability can compliment PARC technology transition efforts.

86. CDI can serve as a Prime contractor on collaborative development efforts (SBIRs, etc.).

88. 30 kg salt per 40,000 liters of water ($4)

89. charge 12V car battery each 40,000 liters ($1.30 at a charging station1)

90. Raw water

91. Capital costs:

92. SE200 ($100 wholesale cost target)

93. 12V 80 Amp-hour battery ($100)

94. Total Capital Costs: $200

95. Operational cost per 1000 liters: $0.131 Electricity battery charging cost is based on charging station price. It would be less if the operator has access to electricity and does not need to go to a charging station.

96. Development Business Model (Aquaya)

97. Comparison of oxidants (operational costs)

98. Field Trials December, 2008: Kenya Kenya, installation of a 20 L electrochlorinator. Collect initial operator/training feedback June, 2009:Kenya Kenya, revisit 20L installation Hold focus groups on 200L alpha prototype Collect qualitative feedback Spring/Summer, 2010: Ghana, Kenya, Zimbabwe Set up first SE200 water kiosks Carry out quantitative microbial studies in households Collect operator and customer feedback Develop preliminary financial model July, 2010: Disaster Response Exercise in Thailand Simulated disaster scenario Train Thai Marines to operate the SE200 Compare to 5 other disaster relief water technologies