Modzify Investor Presentation

1. Investor presentation
March 2013
Duke Startup Challenge
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge.

2. Confidentiality and disclaimer
This presentation is strictly confidential, and recipients must not disclose any written or verbal information
provided to them in this presentation or thereafter to any third party, without the prior written consent of
an authorized Modzify representative.
This presentation does not constitute an offer to sell or a solicitation of an offer to buy any securities. Its
sole purpose is to introduce prospective investors with Modzify, and it does not contain all information that
may be material. Recipients should conduct their own independent evaluations of the information
provided, and consult their own tax, financial and legal advisors. None of the Modzify companies makes any
representation or warranty (expressed or implied), as to the accuracy or completeness of any of the
information provided, and none of them shall have any liability relating to the use of any information
provided.
Any market analysis and financial projections in the information provided represent the subjective views of
the management of the Modzify companies, and their current estimates of future performance based on
assumptions which management believes are reasonable, but which may not prove to be correct. There can
be no assurance that management’s view or projections are accurate, or that they will be realized. None of
the Modzify companies intend to update this particular presentation.
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge.
2

3. agenda
 team
 philosophy
 solution
 market
 competition
 financial projections
 distribution channels
 milestones
 sources & uses
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 3

4. team
Matthew Pleatman, CEO & founder
• BSE Electrical Engineering & BS Economics
(Duke University, Pratt School of Engineering)
• Associate engineer, General Motors
• 3+ startups, CTO - successful consumer products
Mike Qu, CFO & co-founder
• BSE Mechanical Engineering & BS Economics
(Duke University, Pratt School of Engineering)
• Investment banking - Deutsche Bank AG
• Private equity - Huaneng Invesco WLR
Michael Feng, CTO & co-founder
• BSE Electrical/Mechanical Engineering & M.Eng
Mechanical Engineering
(Duke University, Pratt School of Engineering)
• Associate engineer, General Motors
• Race car vehicle engineer
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 4

5. team
VP of Marketing – Xu Rui
BS Economics & Computer Science, Minor Statistics
Duke University Class of 2014
VP of Sales – Kristin Cole
BS Economics, Minor Spanish, Politics Philosophy Economics Certificate
Duke University Class of 2014
VP of Strategy – Shadi Feddin
BSc Chemistry
Duke University Class of 2015
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 5

6. apple – the forefront of innovation?
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 6

7. iPhone 1 iPhone 5
 Make phone calls  Make clearer phone calls
 Send messages  Send more messages
 Take pictures  Take better pictures
 Surf the internet  Surf the internet faster
 Check email  Check email faster
 Listen to music  Listen to more music
 FaceTime
 GPS navigation
The only truly innovative additions over 6
years of iPhones have been the frontward-
Confidential and proprietary to Modzify LLC. facing camera and GPS
Disclosed in confidence to Duke Startup Challenge. 7

8. why has this been the case?
Every consumer has features that they need and features that they want
Features that people need are largely similar among consumers
Features that people want vary significantly from user to user
For companies like Apple, catering towards fragmented wants is highly unprofitable
What does this mean for you?
You will never see all the features you want on your smartphone
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 8

9. so how are we currently satisfying our wants?
• Software-based
• Highly diverse Inherently
Apps • Low barriers to entry limited by
(Internal) • Primarily personalization & hardware
functionality
After-market options
Untapped potential
• Physical enhancements Limited
Cases • Primarily protection & creativity /
(External) personalization out of box
• Many similar options
thinking
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 9

10. so how are we currently satisfying our wants?
Apps
(Internal)
After-market options
Modzify believes in empowering
users to distinctively expand the
functionality of their smartphones
through an elegant marriage of
software and hardware
Cases
(External)
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 10

11. modzCase - first glimpse
A protective case for your iPhone,
but so much more….
laser pointer,
call recorder,
wireless mouse,
and
battery pack
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 11

12. modzCase - features
laser
pointer
integrated battery pack
call
recorder
wireless mouse
sensor
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 12

13. consumer desire intersects with the modzCase
• In a survey of over 100 smartphone
users1, 68% and 77% indicated an
interest in call recording and laser
pointer hardware respectively
• For large OEMs such as Apple, however,
70% market interest may not be enough
to merit implementation in the next
hardware release
• Even a smaller penetration rate – 42%
among surveyed regarding wireless mice
– represents over 25mm users2
• As a result, these users will never have
their desires fully satisfied
• Modzify fills in the gap that Apple leaves
behind, allowing users to fully
customize smartphone functionality and
satisfy all their wants
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 13
1 Proprietary survey conducted by Modzify
2 Assuming 60mm active subscribers, according to comScore MobiLens research for 2012

14. with similar signals from the broader market
Spending on accessories rising rapidly1… … and cases leading accessory sales2
Evolving accesory market Demonstrated demand3
• Shift in consumer behavior means the iPhone • Revenues for mobile phone accessories in the
accessory must hone an intelligent US increased 32% during first half of 2012
functionality – smartcase – to complement the • Mobile phone cases grew 69% in category size
smartphone capabilities over a year
• This market has been largely untouched by • Case sales grew as average prices for products
large, traditional players increased 25%3
Confidential and proprietary to Modzify LLC. 1 ABI Research, 2012
Disclosed in confidence to Duke Startup Challenge. 14 2 NPD Group Mobile Telecommunications Factsheet, 2010
3 NDP Group, 21 August 2012

15. competitive landscape: wireless mouse
Traditional Hardware Multi-
Description Price
Mouse? free? tasking?
Traditional
wireless $59.99
mouse
Motion-based
mouse,
trackpad, and $1.99
wireless
remote
Logitech Controls PC
Touch via server Free
Mouse connection
Built-in
iPhone case $79.991
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 15 1 Informed by Modzify pricing study

16. competitive landscape: case integrated battery
Case Other
Description Price integrated? Battery Life
capabilities?
Anker® Astro
Connects via
5600mAh
USB to 2-3 full
Backup
iPhone, iPad, $49.99 Flash light
External charges
iPod
Battery Pack
Incipio® LED indicator
offGRID lights inform Doubles
Backup backup battery $69.99
battery life
Battery Case life
MiSuny iPower 4
Recharges
Increases
phone with $105.00 life by
solar energy 200%
laser, call
Built-in Doubles recorder,
iPhone case $79.991 battery life mouse, battery
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 16 1 Informed by Modzify pricing study

17. competitive landscape: call recording
Hardware Subscription Recording
Description Pricing
free? free? storage
Olympus
Audio splitter
TP-7 External
to recording $38.87
Telephone device drive
pickup
FSV-510
External
Mobile audio $189.99 Cassette
Recorder recorder
CallRec.me Third-party $0.67 iPhone
+ other dial-in record per rec only
apps
Internet- $29.99 – Cloud
based $149.99 only
subscription
Built-in Cloud &
iPhone case $79.991
iPhone
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 17 1 Informed by Modzify pricing study

18. financial projections
Base case assumptions: Modzify - Financial projections
($ in thousands) Year 1 Year 2 Year 3 Year 4 Year 5
— 0.01% initial overall iOS
Unit sales 6.17 16.37 39.04 82.67 174.87
penetration rate growing to 0.25%
% growth 165.4% 138.5% 111.8% 111.5%
in five years
Total revenues $ 493.35 $ 1,309.15 $ 3,122.65 $ 6,612.84 $ 13,988.10
— Weighed average price of $79.99 % growth 165.4% 138.5% 111.8% 111.5%
— Domestic active mobile subscriber COGS 7.89 20.95 49.96 105.81 223.81
% revenue 1.60% 1.60% 1.60% 1.60% 1.60%
growth of 0.9% SG&A 475.42 720.03 1,561.33 3,306.42 6,994.05
— Domestic iOS / mobile penetration % revenue 96.37% 55.00% 50.00% 50.00% 50.00%
R&D 175.00 262.50 262.50 262.50 262.50
rate capped at 31.5% % revenue 35.47% 20.05% 8.41% 3.97% 1.88%
EBIT $ (164.97) $ 305.67 $ 1,248.86 $ 2,938.11 $ 6,507.74
% growth 154.0% 308.6% 135.3% 121.5%
Upside case assumptions:
Case by case EBIT
— Same as base case assumptions
excluding:
— Assumed penetration growing to 2%
of total active iOS units
— Cost structure same as base case
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 18

19. distribution channels
Crowd funding Amazon Online storefront
 De-risks business by  Amazon “Fulfillment  Initial lower cost
demonstrating by Amazon” plan proprietary channel
demand handles storage, providing first direct
shipping and customer contact to customer
 Covers majority of
service
manufacturing costs  Planned penetration
associated with first  No minimum unit into traditional brick
production round requirement and mortar
distributors by year 2
 Helps generate  Net impact on margins
publicity ~17% per unit
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 19

20. milestones
status:
— demonstrated consumer demand through market research
— prototyping design established
— initiated patent protection process
— began Apple MFi approval process
— seeking initial $50,000 investment for prototyping and IP costs
timeline:
February 15, July 31 November 30,
2013 2013 2013
Preliminary Investor Close of first Supply chain & distributor Begin mass production
prototyping, presentations round contracts
seek financing,
seed fundraising prototype
functional
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 20

21. sources and uses
post-financing deliverables: Total round 1 fundraising sought:
$580,000
—Shipped 5,000 units (primarily crowd
funding) Sources
—Prototyping and R&D of first two Duke Startup Challenge 50,000
products completed Crowd funding campaign 330,000
Individual investors 200,000
—Production tooling completed
Total sources 580,000
—First manufacturing run completed
Uses
—3 utility patents, 2 design patents filed
Tooling 100,000
—Product placement on Amazon and online Contract engineering 150,000
storefront Market research 15,000
—Financing adequacy until January 1, 2014 Office rental 60,000
Travel 25,000
Salary 150,000
Patents 60,000
Other legal 20,000
Total uses 580,000
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 21

22. thank you
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 22

23. APPENDIX
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 23

24. breakeven analysis
Modzify - Breakeven analysis
Downside Base Upside
Unit price $69.99 $79.99 $89.99
Units sold (mm) 6,071 10,158 5,698
Revenue $424,926 $812,525 $512,790
Unit COGS $14.40 $16.00 $17.60
COGS $87,426 $162,525 $100,290
Gross Profit $337,500 $650,000 $412,500
% GM 79.43% 80.00% 80.44%
Fixed costs $337,500 $650,000 $412,500
Operating profit ($0.17) ($0.00) ($0.40)
% margin 0.00% 0.00% 0.00%
Confidential and proprietary to Modzify LLC.
Disclosed in confidence to Duke Startup Challenge. 24