Presented at Global Education and Training Investment @ MIT Sloan Edtech Friday event. Agenda: 1. Introduction about NetDragon 2. Global education and training - insights and trends 3. The Next Big Thing! - VR/AR

1. Learning: Reimagined
Vincent Fung
Investment Director
vincentfung@nd.com.hkNetDragon Websoft Inc.
MIT Sloan EdTech Friday
March 11th 2016

2. Agenda
• NetDragon
• Global Education & Training - Insights / Trends
• Next BIG Thing

4. For 2 years in a row,
NetDragon was named
“Outstanding Employer –
The Best Companies to
Work for in China”
by Fortune magazine

5. Star War X-Wing Fighter Pyramid-like Idea Workshop
Stepped Courtyard - Staff Dormitory Creative Metal Slide

6. Hui-style House
D i n o s a u r F o s s i lSwimming Pool and Diving Platform
Beach

7. OUR INTERNET COMMUNITIES

8. Pre-
school
K12
Higher
Education
Vocational Enterprise
In Class On the Go At Home
WE BELIEVE LEARNING IS
FOR A “LIFETIME”

9. PROMETHEAN BY THE NUMBERS
+30 MILLION
Student users
2 MILLION
ActivInspire software users
1.3 MILLION
Classrooms with Promethean ActivBoards
+2 MILLION
Promethean Planet Members
+90,000
Lesson resources on Promethean Planet

10. 10
THE NETDRAGON FAMILY

11. PARTNERSHIPS

12. Global Education &
Training
insights and trends

13. 1> $5tn (Source: IBIS Capital)
Of global education expenditure in 2014
8x the size of software market
3x the size of media and entertainment industry
Yet education is still only 2% digitized

14. (Sources:
1 - IBIS Capital
3 – PwC
11 - Based on Bank of America Merrill Lynch CAGR estimates of 7%-9% from 2012A to 2017E extrapolated to 2020E
12 -- Based on GSV Advisors CAGR estimates of 7% from 2013A to 2018E extrapolated to 2020E)

15. (Source: IBIS Capital)

16. 2> 90%
Of the world’s population under 30 is already in Emerging Markets
Growing at 3x the rate of developed nations

17. (Source: IBIS Capital)

18. 291M
80M
This shows the total number of students
from pre-K to higher ed. in China vs. USA.

19. 291M
# of K12 students : 55M
# of K12 teachers: 3M
253M
6.8M
221M
13.2M

21. 3> 80%
Of the world’s population will be able to access mobile broadband
within 5 years

23. 23%
58%
Gr 6-8 Gr 9-12
0%
10%
20%
30%
40%
50%
60%
70%
My Own Device
What type of mobile
devices do you use
at school?
(including:
my own device,
school laptop,
school tablet,
school Chromebook)

24. 4> 50M
People could find work that more closely suits their skills or
preferences through various Online Talent Platforms to solve the
global labor supply imbalances (est. $10tn of GDP at risk)
(Source: McKinsey Global Institute)

28. 5> MOOCs
Making progress with certification business model
Coursera generating an estimated annual run-rate of $30M revenue
from certification
(Source: IBIS Capital)

29. Source: Blackboard Learn website

32. 6>Immersive Learning
100% attention levels doubled (92% vs. 46%)
Test scores increased with 35%
86% of students improved test results
(Source: http://www.bbc.com/news/technology-15115059)
Comparing traditional education and training with using Interactive 3D

33. VR Technology Highlights
：Participants exists in the virtual environment as the protagonist
Participants and virtual world objects interact naturally
：Vast imagination

35. Create“Real”Learning Environment
• Dangerous
• Can not be touched
• Inexistent in the real life
Extinction
Natural
Disaster
Microscopic
World
Macroscopic
World
……
Volcano Eruption
Earthquake Outbreak
Fire incidents
Ancient life
Cell Division
Space

36. 7> Edtech investment
bubble
2015 global Edtech investment spikes to record $6.5
billion
(Source: Ambient Insight 2016)

38.  Investments in China accounted for 33% ($2.19 billion) of all in 2015
o vs. 6% in 2013, 1% in 2012
o Big ones > 100M: Zhan.com, 17zuoye, TutorGroup, HuJiang.com
 Sharp spike ($483.5 million) in investments going to Cognitive Learning companies in 2015
o vs. $24 million in 2014 and$6.9 million in 2013
o 52 Cognitive Learning companies, e.g. Virgin Pulse, Lumos Labs, Headspace, Omada Health
 Consumer-facing companies in 2015 jumped 3x to $3.12 billion; 48% of all global investments in
2015
 25 learning technology companies got investments amounts at or above $50 million in 2015
o 15 of these companies are based in China, nine in the USA, and one in Brazil
o Combined obtained $2.523 billion in 2015, > total investments of all 316 companies in 2014
 Complete absence of investments made to learning technology companies in Brazil in the fourth
quarter (Affero Labs, Movile)
 Continued uptick in investments in India, and the burst of investment activity in the UK in H2
Source: http://www.ambientinsight.com/Default.aspx

42. Areas for Growth
• Mobile Learning – mobile first learning model
• Social Learning – collective and collaborative
• Skill Matching – efficiency in labor market
• Machine Learning – personalized, adaptive
• Immersive Learning – engaging VR/AR content
• Gamification – entertaining content

43. Next BIG Thing
Virtual / Augmented Reality

44. • Augmented/Virtual Reality
to hit $150 billion
disrupting mobile by 2020
• Over 500,000 units sold in
2016 (Oculus, HTC, Sony, Samsung)
• 1 Million+ if include
cardboards
• Over 500,000 content
available (3D, 360 videos,
VR animations)

46. VR Industry Landscape
HMD：Oculus VR、HTC Vive、Sony Project Morpheus、
Samsung Gear VR、Google Cardboard、Sulon, etc
Control Device：Virtuix Omni、Nod Labs、virZOOM、Leap
Motion、Oculus Touch、Sixense, etc
Cameras：Jaunt VR、Nokia、Otoy、Structure.io、hover.to、
VideoStitch, etc
Developer Tool Kits：Unity、Unreal Engine、WorldViz、
GameWorks VR、OSVR、High Fidelity
Content（Produce VR）：Reload Studios、nDreams、Visionary
VR、NextVR、Felix& Paul Studios、Insomniac Games, etc
Social Network/Content Platform：Littlstar、Wear VR、
AltspaceVR、Vrideo、EmergentVR,etc
Educational VR：Woofbert、Zspace、Discovr、drashvr

48. VR Education Content
VR Social Platform
Areas Relevant to Learning
VR content sharing Platform

49. Smart2vr Vizor
https://www.youtube.com/watch?v=ik5PzA-oe_c https://www.youtube.com/watch?v=l8ZnWT-ydqg
Example – VR Content Editing Tool

50. Eon reality Worldwiz
https://www.youtube.com/watch?v=lxZhHiV_SlA https://www.youtube.com/watch?v=ycTNwr6AYIY
Example – VR B2B Corporate Training

51. High fidelity Immersive VR Education
https://www.youtube.com/watch?v=GQAjJaHNjD0 https://www.youtube.com/watch?v=ycTNwr6AYIY
Example – VR Classroom, Second Life 2.0

52. Q&A
I am hiring!
VincentFung@nd.com.hk
www.NetDragon.com