1 Idea To Market Process How To Startle The World With Your InventionJames Schmidt & Jim Rodney for New Energy Systems Trust IdeaToMarket.info Copyright © 2016 New Energy Systems Trust All Rights Reserved

2 Idea To Market Process Financial Engineering BusinessHow to use this document This document contains linked navigation. Click on the boxes in the flowchart on page 5 to jump to the respective subject pages. You can also navigate using icons on the top: Home - takes you back to Home page Flowchart - jumps back to the flowchart from any page. Forward | Back arrows - next or previous pages Underlined text is hyperlinked directly to web pages. Legend: the three different colors represent Financial, Engineering & Business categories. Financial Engineering Business This document is available for download for free, but we ask for a donation of $5.00, or more if you wish to support the work of the New Energy Systems Trust. A link for donating can be found at: IdeaToMarket.info All Rights Reserved

3 Steps in the Process Introduction Idea Documentation Seed Funding Experimentation and Analysis Lab Prototype Design Refinement Validation Testing Market Assessment Invention Protection Strategy Stage I Investment Engineering & Development Engineering Optimization Business Strategy Business Plan Market Validation Stage II Investment Production Prototype Engineering Production Model Testing Market Launch Next Steps Summary NEST to the Rescue Resources 4 6 7 8 9 10 11 12 13 14 &15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 IdeaToMarket.info All Rights Reserved

4 Introduction "You might have the best technology in the world, but if you don't get it to market, it's useless." Shaun McCarthy This presentation is intended to give the inventor or entrepreneur an overview of the steps and processes involved in taking an invention from idea to finished product in the market place. The process begins with demonstrating that your idea or concept works (proof of concept). Next is a laboratory prototype that might be the forerunner of a manufacturing model. The lab prototype validates your idea/concept and even allows third parties to test your design. Along the way it is a good idea to thoroughly document your idea, the design and the test results. This is particularly important for copyrighting or patents. Once you have validated your idea and demonstrated the device, you may consider getting it manufactured or selling the rights to your device. This is where you may want to protect your invention either through the patent process, by copyrighting or deciding to open-source it. Each of these paths has its own process and pitfalls. It is important to get business guidance help at this point. Most inventors do not have the financial resources to get all the way to the market. Your documentation and validation testing will help you secure early funding for your idea. In most cases investors will want some level of control over your project to ensure their returns. Selling your idea to an investor or manufacturer requires not only undeniable test data and convincing demonstrations, but also a great presentation by you or a credible third party. There are many incubators across the country that can help you with this. NEST is dedicated to helping inventors and entrepreneurs bring their exotic technologies to the market. NEST’s mission is to assist the inventor with advice, engineering, prototyping services and validation testing. In addition, our NEST team can assist in soliciting such funding on behalf of the inventor. Feel free to contact us with your needs - we’re here to help. Good fortune with your next exotic technology invention! The NEST Staff IdeaToMarket.info All Rights Reserved

5 Idea to Market Flow ChartSeed Funding Experimentation & Analysis Documentation Market Assessment Validation Testing Design Refinement Lab Prototype Patent Invention Protection Strategy Stage I Investment Engineering & Development Engineering Optimization Copyright Open Source Create LLC Stage II Investment Market Validation Business Strategy Business Plan Incorporate License Production Prototype Engineering Production Model Testing Market Launch Manufacturing & Distribution Next Steps IdeaToMarket.info All Rights Reserved

6 Idea You have an original idea orYou have an idea for expanding on an existing invention. Do you have the means to explore the idea with Performing experiments Building prototypes or do you need to solicit some help? IdeaToMarket.info All Rights Reserved Monday, November 5, 2012

7 Documentation Begin to document your idea.Have your documents dated and witnessed. Get a good journal and keep detailed notes in it. It is also a good place to document your analysis, any changes you make as well as results of experiments. Keep your journal in a safe place. This documentation will be important for the patent process and for providing data for potential investors and licensees. IdeaToMarket.info All Rights Reserved Monday, November 5, 2012

8 Seed Funding Solid financing is essential for getting a great idea off the ground. However, investors tend to shy away from ideas that are still on paper. You will have to fund the initial research and development yourself. This “seed funding” can come from several sources: Savings Second mortgage on the house Family members Friends Crowd funding A solid plan with some demos could help convince others to support your idea. They should clearly understand that they could lose their money. IdeaToMarket.info All Rights Reserved

9 Experimentation & AnalysisAn idea is only the start. You must show and provide evidence that your idea will work in the real world. * Define in engineering terms what your device is intended to do, including the subcomponents or subsystems needed to make it operational. What size, operating parameters, inputs etc. Begin by experimenting with each subcomponent of your device. Integrate the experiments. Take care to document the results of each aspect of the experimentation. * Be sure that any disclosures of the technology are done under Non Disclosure Agreement (NDA) or at least 'CONFIDENTIAL' terms, otherwise you could jeopardize your technology, including the option of patenting the device. Technologies in the public domain cannot be patented. IdeaToMarket.info All Rights Reserved

10 Lab Prototype Build a prototype of your invention.Keep it small so that changes are easy to make. Think it through before you build. Nikola Tesla would complete his devices in his head, working them through in his mind before building them. Document, document, document. IdeaToMarket.info All Rights Reserved

11 Design Refinement Often, an initial design based on experimentation does not meet expectations. Refine the design. Do more experimentation to find solutions that enhance your model. Refine the design. Once you have something working you can begin soliciting help for promotion and long-term funding. * You can and should always be improving the design; but at some point you need to settle on a version that is far enough along to make a good demonstration. Then it is time to convince others of the value of your invention. You can improve on it later with financing. * Be sure that any disclosures of the technology are done under Non Disclosure Agreement (NDA) or at least 'CONFIDENTIAL' terms, otherwise you could jeopardize your technology, including the option of patenting the device. Technologies in the public domain cannot be patented. IdeaToMarket.info All Rights Reserved

12 Validation Testing You will want to do third party validation testing of your device/product to convince investors to take you to the next step. * If possible, get two or three third-parties to validate the operation of your device. Third-parties will want to measure and compare the input and output in addition to early testing of other factors like efficiency, cost savings, emissions, safety, pollution, etc. Third-party testing is invaluable to your credibility and to the salability of your device. “Third-parties” refers to qualified parties, such as universities or laboratories, that are not tied to the project. Continuing documentation is important. * Be sure that any disclosures of the technology are done under Non Disclosure Agreement (NDA) or at least 'CONFIDENTIAL' terms, otherwise you could jeopardize your technology, including the option of patenting the device. Technologies in the public domain cannot be patented. IdeaToMarket.info All Rights Reserved

13 Market Assessment Ask these questions to help determine your probability of business success: What is the primary function of your invention? Is this a major improvement over existing methods/devices? What are the major applications of your invention? How large are the key markets you are targeting? How big an impact might your technology have on these markets? Would this be considered a “disruptive” technology or an incremental improvement? Does your technology offer major competitive advantages - i.e. 80% less cost? Does the market exist today, or will you have to develop it? How difficult do you feel it will be to develop, test, and protect? IdeaToMarket.info All Rights Reserved

14 Invention Protection Strategy: Patents, Copyrights, IPCBIt is important for the serious inventor to protect his invention from being copied and commercialized by others, prior to significant public and investor encounters. There are two basic ways to protect your invention/idea: By a patent By a copyright “A patent grants third parties the right to copy the description (text and drawings) of an invention but forbids them to commercialize it.” United States Patent & Trademark Office: “A copyright forbids third parties to copy the description (text and drawings) of an invention in order to commercialize it.” The WIPO is a great source of information on Intellectual Property rights. A subset of the copyright is the intellectual passport CB The IPCB may provide better protection than a patent. See Sterling Allan’s excellent description and research. IdeaToMarket.info All Rights Reserved

15 Invention Protection Strategy: Open SourceAn alternative to fully protecting your invention from copying and commercialization by others is to go open-source. Open source encourages people to replicate, improve, and commercialize the technology that you have developed. To be highly successful in the open-source approach, the technology should be: Easy to understand Easy to build Inexpensive Have significant power output Unencumbered intellectual property You can always request a royalty for all commercial sales of others, but you will be relying on the honor system unless you have a patent. Open-source is a way of getting your invention widely spread and benefitting mankind. Once it is public, a patent cannot be filed by anyone else. You can still patent the device before going open-source. IdeaToMarket.info All Rights Reserved

16 Stage I Investment Most inventors/entrepreneurs require financial assistance. After the proof of concept and validation testing you may want to solicit investor funding. To use for additional research and development To scale up your prototype For additional testing or test hardware There are many sources of financial help. Venture capitalists Angel investors Crowdfunding Corporation Manufacturers Develop a plan for presenting your idea to investors. Get professional help. Be prepared to demo your device and present relevant data. Be prepared to get outside help for soliciting investors and negotiating the terms of the investment. IdeaToMarket.info All Rights Reserved

17 Engineering & DevelopmentOnce you have provided a proof of concept, you are ready to engineer a more robust prototype. You should build multiple prototypes for redundancy and to illustrate the technology on different scales or embodiments. This will require careful consideration of each of the design parameters. What will the working application be? Powering a generator or car? What are your design goals? Horsepower, torque etc.? Are there any size constraints? Other engineering problems to address? Begin developing prototypes that reflect these design parameters. Each aspect of your design will have to be researched, built and tested. Once you have each unit built to reflect your design parameters, you should perform characterization tests to see if it meets your specifications. IdeaToMarket.info All Rights Reserved

18 Engineering OptimizationOnce your engineering prototype generally meets your expectations, you will want to optimize the design. You will want to make it as efficient as possible for the size constraints. There may be cost considerations in some of the materials used. You may want to balance some of the engineering parameters. Some of the tolerances or specifications may be difficult to meet. This continued development and testing to achieve your engineering goals is referred to as “engineering optimization”. IdeaToMarket.info All Rights Reserved Monday, November 5, 2012

19 Business Strategy At some point in the process, you will need to decide on a business strategy for the continued development, manufacturing and sales of your product or invention. Your business path will depend on many factors. Your personality Your business abilities Your technical abilities Your goals and objectives for the invention You may want to handle everything from beginning to end. You may want to get other experts and consultants involved. You have several choices: Sell your invention. License your invention or product to a manufacturer or other entity. Develop an LCC as a business entity to operate under. Create a corporation with the intention of manufacturing your own product. Open source your invention. IdeaToMarket.info All Rights Reserved

20 Business Plan A well-researched and documented business plan is essential to the success of your business. Writing a business plan forces you to research and plan for every aspect of your business. A business plan takes into consideration every cost and needed resource. A good business plan will help you convince the investors to buy in. A business plan may take several months and thousands of dollars to do properly. Get help with your business plan. Ask business experts to review your plan. IdeaToMarket.info All Rights Reserved

21 Market Validation You now have a device/product that has been validated according to your expectations Before you solicit major capital to fund the manufacturing of your device, you will want to ensure there is a market for your product. This can be done several ways, depending on the market and your product: Simple focus group panel reviews may be all that is necessary. You can invest in some market research. You can develop a market prototype for early “beta testing”. Advertise on blog sites, industry related magazines, etc. This can lead to an early level of interest in licensing, partnering or distribution rights, etc. and increase the probability for manufacturing funds and long-term business success. IdeaToMarket.info All Rights Reserved

22 Stage II Investment The manufacturing stage is where investors are ready to make serious commitments. You have validated and demonstrated your product and team. You have established credibility via your demos and validation tests. Investor commitment will involve considerable negotiations as you give up some or even the majority of control of your invention. You will have to decide what involvement you will have going forward. You can sell your invention outright. You can maintain some control and do your own manufacturing. You can simply be a consultant after selling your product. Or you can outsource the manufacturing with continuing involvement. Develop a great presentation for your invention or product. A demonstration by itself will not cut it. You are part of the presentation. Get help from qualified professionals who have the presentation skills – your future depends on it. Postscript: rather than seeking investment, you might consider crowdfunding. IdeaToMarket.info All Rights Reserved

23 Production Prototype EngineeringProduction models are essential for several reasons; Establish the feasibility and ease of production in all phases. Help establish the manufacturing process and controls. Determine accuracy of manufacturing specs. Establish manufacturability of all components. Enable setup of quality control procedures. The design which emerged from the research and development phase will serve as the basis for developing a production model. The production prototype will be used to address each of the areas of production listed above. IdeaToMarket.info All Rights Reserved

24 Production Model TestingProduction validation testing (alpha testing) is used to: Ensure production models will meet specifications. Establish the reliability of the production models. Evaluate maintainability and maintenance requirements. Use to determine quality control processes. Test for environmental hazards: heat, cold, vibration, altitude, etc. Evaluate for possible operational hazards: chemical emissions, radiation, electromagnetic emissions, etc. Submit for certification to UL, CE, etc. The production model is then ready for “beta testing” with select customers in real life situations. IdeaToMarket.info All Rights Reserved

25 Manufacturing & DistributionAfter you have proven the design, you are ready to hit the copy button. How many copies you make before introducing the product to market will depend on your business plan and strategy. If you are gradually, incrementally rolling it out, you can start with a small production run. Or your strategy might be to go with a well-established manufacturer in a specific sector – going straight to the major leagues. Or, if you are open sourcing, then manufacturing becomes a free-for-all, enabling anyone anywhere to build as many, as fast, for whatever application and region they want. Your business plan will also define how you will be distributing the finished products into the market.This likewise will vary depending on your strategy. IdeaToMarket.info All Rights Reserved

26 Market Launch Congratulations!You have realized the dream of taking your invention from an idea on paper to finished product ready for the market. Marketing your device is a whole new endeavor which will require research and possibly outside resources. Your road to future returns on your invention has just begun. IdeaToMarket.info All Rights Reserved

27 Next Steps Once you reach the marketplace there are still many processes required to achieve long term marketing success. Continuing R&D to ever-improve the technology Expanding the number of applications, sizes & scaling Expanding the market reach Going International Marketing and management represent a whole other set of disciplines not covered here. There will also be the challenge of managing a company and it’s profits for maximum success. IdeaToMarket.info All Rights Reserved

28 Summary The process of bringing an idea to market is a long and arduous path. Each step requires diligence and good planning. You may want to stick to inventing and let your invention be developed and marketed by the pros. You may want to keep control all along the way but you may need hire experts in certain areas to help you succeed. Whichever route you take, persevere and do not give up! IdeaToMarket.info All Rights Reserved

29 NEST to the Rescue NEST can help with the challenges of bringing your invention to the market, including: Assistance in areas where you lack knowledge Expert evaluations Outside lab testing Building prototypes Advice on patents, copyrighting and open sourcing Licensing Financing The mission of NEST is to assist the inventor or entrepreneur in successfully bringing his exotic energy ideas and inventions to market. IdeaToMarket.info All Rights Reserved

30 Resources Websites/ArticlesBringing your Invention to Fruition - Product to Market in Six Steps - How to Bring Your Invention to Market (Inc. Magazine) - Ask The Inventors - Invention Help - Tools - Books “Inventing on a Shoestring Budget” by Barbara Russell Pitts, Mary Russell Sarao “Bringing Your Product To Market” by Don Debelak Government Resources Starting a Business - Business Loans - (Up to $1 Million per award) U.S. Patent Office - Coaching: Professional Coach, Linda Plano - (YouTube Series, Boot Camp) IdeaToMarket.info All Rights Reserved

31 Contact Us NEST Site Contact Page: For specific questions or requests for help with your invention, send a note to one of the addresses listed below. For comments or suggestions on the "Idea to Market” process, send a note to James Schmidt: James Schmidt: Office: (970) Skype: jschmidt113 IdeaToMarket.info All Rights Reserved