EFTA00591045.pdf

915 BROADWAY. SUITE 1101 NEW YORK. NEW YORK 10010 ANDREW@VALAR.COM JAMES@VALAR.COM VALAR VENTURES VALAR VENTURES IS AN INTERNATIONALLY-FOCUSED VENTURE CAPITAL FIRM fin OWNMet IS COMOfnb.Y.IMl 54041. and 00ICOF !UMW CIMINICA Alst DMtlm3M,I41Ny.1gnlM M MuNIMLItl. Mato NKr mite nivil pipits 44060n31 Alta lift 101006/01M414 alseamors. This donamm d Wont .1110.141 YW6 MC 40&(01W bIJ SOIL Mid Of a SMC[YOOI011uf.SC9 a hold atqmmitios. Mom had la iN Mau Pilcomat Mimaanada W Its tom 01 an/ relabordelp wanialat V4MureLltinKNOMAILLC CValanifa 4IM4CM. EFTA00591045 INTRODUCTION VALAR HIGHLIGHTS INCEPTION - 2010 TOTAL INVESTED - $78.0 mil TOTAL GROSS & NET VALUES $271.2 mil / $223.0 mil GROSS & NET MULTIPLES 3.5x / 2.9x GROSS & NET IRRs 120% / 98% As by pmerte0 arc uwAnt0 eitinetes tn1)50 es t. 6430/2011. Mel 03unn My) cakaatod try Neap 'ots Pt.:Abby a 801 25% tOnt/POthebtai n$.16.1ettntet tee. memos <r0 ten VALAR, A GLOBAL VENTURE CAPITAL MANAGER, HAS ACHIEVED EXTRAORDINARY RETURNS FOR ITS CLIENTS, TRIPLING ASSETS IN JUST OVER THREE YEARS AND VASTLY OUTPERFORMING INDUSTRY BENCHMARKS. VALAR VENTURES Since 2010, the value of client assets has risen from US $78 million to $271 million, for gross multiples and IRR of 120% and 3.5x; net multiples and IRR are 2.9x and 98%. Valar is managed by Andrew McCormack and James Fitzgerald; Peter Thiel, one of Silicon Valley's most successful venture capitalists, serves as the firm's advisor and chairman. The firm is launching its first institutional fund, which will deploy up to $150 million during 2015-2019, its primary investing phase. NET MULTIPLE NET IRR VALAR 2.9x 98.4 % CAMBRIDGE US VC INDEX 1.7x 31.3% CAMBRIDGE GLOBAL EX-US 1.1x 5.5 % DEVELOPED MARKET VC/PE INDEX CAMBRIDGE GLOBAL EMERGING 1.0x 01% MARKETS VC/PE INDEX S&P 500 1.6x 10.5 % Wireatcf iniente0 bVS se es ce 6/50/201s Vete mide es nrs1 mestment on 10/21/2010 amuse twat Cern. Oncipt dote is not nude erttUble for seven. tenths Siff the and of 'UMS VOW KM MUMS the awns meat MY dace /WSW* ner vlef.aa0 2010 ruACIU ii thOQQM 01 US W. Cant 'da It as 010/31/2011w4n the NN 01 ex-VS denim:et, encl men,n9 asnattf aVVC. Centa:ge 0,4 nes l 9/30/]OIS timbers veserteel tor the SW 300 we tor the venal mama (MI tracery Osy ce 2010) 6/30/2014 Net neve, ice We er0 lox S&P S00 etre (*MAWS by N0ufw10 pan paltt LI a 2011S% Is. topanhaUtal rnatalaallita NN. Oxtail:tat ale caw, Al 00Ws pmente0 ere n USD Vihrs Ivan re uleuditt0 estendes ccorpecesne es rolled end invented suns/knees Scon:es. Centedee Amore% Deer Arum: Sten03.0 & Pan end Ws INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 2 EFTA00591046 INTRODUCTION / TEAM ANDREW AND JAMES FOUNDED VALAR IN LATE 2010 TO PARTNER WITH THE BEST ENTREPRENEURS OUTSIDE THE UNITED STATES. The team brings extraordinary operational, deal-sourcing, and reputational assets to its investing activities. kor ContaAzul Canopy Labs TransferWise Omplica. orra granify 4t INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 3 EFTA00591047 INTRODUCTION / TEAM ANDREW McCORMACK PARTNER Andrew McCormack Andrew is a founding Partner at Valar Ventures. Andrew's career in technology has included business and corporate development roles at eCount (acquired by Citicorp) and Yahoo!. He joined PayPal in 2001, where he worked closely with Peter in preparing for the company's IPO. After PayPal's sale to eBay, Andrew helped launch Clarium Capital and later founded a restaurant group in San Francisco. In 2008, Andrew rejoined Peter at Thiel Capital, where he led various international initiatives for Thiel Capital and Peter personally. Andrew received his B.A. in Political Science from the University of Pennsylvania. JAMES FITZGERALD PARTNER James Fitzgerald James is a founding Partner at Valar Ventures. Prior to Valar, he was COO and General Counsel of Peter Thiel's global parent company, Thiel Capital, where he helped manage Peter's extensive network of investments and businesses. In that capacity, he worked closely with the Founders Fund, Mithril, and Clarium. Prior to joining Thiel Capital, James practiced law for seven years in the New York office of Skadden, Arps, Slate, Meagher & Flom LLP. He received his J.D. from the University of California, Los Angeles and his undergraduate degree from Brigham Young University. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 4 EFTA00591048 INTRODUCTION / TEAM E PETER THIEL CHAIRMAN Peter Thiel is a founding Partner and the Chairman of Valar. As a technology entrepreneur, investor, and philanthropist, he first gained attention for innovations in banking and startup finance. Today he is known as the mentor of the PayPal network of entrepreneurs. He works to accelerate innovation by identifying and funding promising technology ideas and by guiding successful companies to scale and dominate their industries. In 1998, Peter made e-commerce easier, faster, and more secure by co- founding and leading PayPal. In 2002, he sold PayPal to eBay and founded a global macro fund, Clarium. In 2004, he co-founded Palantir Technologies, which offers platforms for finance companies and intelligence, defense, and law enforcement communities to integrate, visualize, and analyze the world's information. In the same year, he made the first outside investment in Facebook. In 2005, he co-founded Founders Fund, a leading Silicon Valley venture capital fund that has pioneered new methods of venture financing that benefit founders. Through Founders Fund, as well as through his private investing, Peter has helped build the next generation of tech companies. Peter earned a B.A. in philosophy from Stanford University and a J.D. from Stanford Law School, where he occasionally teaches on globalization and technology and serves on the board of overseers of the Hoover Institution. His articles have appeared in Policy Review and the Wall Street Journal. He lives in San Francisco. As Chairman of Valar Ventures, Peter provides strategic advice and mentoring to Valar and its portfolio companies. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET OS EFTA00591049 VALAR ADVANTAGES / EXECUTIVE SUMMARY VALAR IS DIFFERENTIATED BY SEVERAL DISTINCT ADVANTAGES: TRACK RECORD: Valar's managers have shown exceptional investing acumen. Returns are at the top of class. with a net multiple and net IRR of 2.9x and 98.4%. respectively. THESIS & MARKET: Persistent inefficien- cies in venture markets outside the US provide compelling opportunities for future returns. Net Ivies ve es oi (.150/20U aM eve min:kilned en win," gross Flails Dv 01412Y6 for mre9ernern hes. moms end cloy TEAM: Valar's team has a successful and long record of working together to find and oversee investments. REPUTATION: In addition to an outstand- ing track record and strong credibility with portfolio companies, the team is advised by Peter Thiel. consistently named one of the most influential venture capitalists in the world. ACCESS: Valar has access to deals at propitious moments - when local VCs have moderately de-risked the company but before scale makes the investment obvious to large, less price-sensitive investors. We believe these characteristics serve as a solid foundation for outperformance in Valar's new fund. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 06 EFTA00591050 VALAR ADVANTAGES / THESIS GLOBAL VENTURE CAPITAL IS HIGHLY INEFFICIENT COMPELLING OPPORTUNITIES While the abundance of capital in Silicon Valley has compressed returns for all but the best venture firms (most of which are closed to new investors). start- ups outside Silicon Valley have much more limited access to both capital and experienced start-up investors. This creates compelling, well-priced opportunities for Valar. GLOBAL VENTURE FUNDING — NON-US STARTUPS ARE RELATIVELY UNDER FUNDED $50 $40 I $30 O SD f; $20 $10 $0 • 2006 2007 2008 2009 2010 Son Dow lonts.tils' constitutes the hoe ;melt vtoture nortelsocbde Ve US. .1W% revesert the sibtaalsOmaionty of El veMee funlyg made On VS. - EX-US IN - US 2012 INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL Si TRADE SECRET 07 EFTA00591051 VALAR ADVANTAGES / THESIS VALAR BELIEVES THAT THESE INEFFICIENCIES WILL PERSIST, EVEN AS US FIRMS EXPAND OVERSEAS, A PHENOMENON EMBODIED IN THE LACKLUSTER RETURNS OF US VCs OPERATING OVERSEAS. I. Local entrepreneurs perceive satellite II. The best Silicon Valley VCs generally III. This creates opportunities for Valar. offices as merely regional players without do not travel outside the US - they have which has deep links to Silicon Valley. access to the marquee talents of the flag- sufficient deal flow at home and have strong access to capital, and an explicit ship office and disfavor them for deals. partnership and family dynamics that mandate to invest overseas. make frequent travel difficult. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET OS EFTA00591052 VALAR ADVANTAGES / A GROWING GLOBAL NETWORK • • • • • • • • • • •••• ••••e• ••• A. PayPal network develops in San Francisco. James joins Andrew at Thiel Capital in 2008: the two begin working on special investment opportunities for Peter. B. Team diligences investments in New Zealand, leading to an investment in Xero and an eventual partnership with NZ government. 4 • • • • • • • • • • • • • • • • • •••• •t.• ••••n •••-r • ; • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • OOOOOOOOOOO • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • sap • • • • • • • • • • • • • • • • • nab • • • • • • • • -c) • C. Team expands Australasian presence. making two investments in Australia and establishing their network there. D. Oppa's founder. aware of the growing reputation of the Thiel team, meets with Valar as it begins exploring opportunities in Brazil. The firm invests and its relationship with Oppa and its syndicate produce three additional investments in Brazil. E. Introductions from colleagues and contacts lead to investments in Toronto, establishing the beginnings of a Canadian network. F. Max Levchin, co-founder and COO of PayPal and a former colleague of Andrew's, introduces the team to Transferwise, establishing Valar's first presence in Europe. G. Valar establishes its own offices in New York to better manage international operations. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 09 EFTA00591053 VALAR ADVANTAGES / PORTFOLIO PHILOSOPHY THE FIRM IS FOUNDER FRIENDLY AND EMPHASIZES LONG-TERM VALUE CREATION: IT ENCOURAGES FOUNDERS TO RESIST SHORT-TERM FINANCIAL PRESSURES IN FAVOR OF MAXIMIZING LONG-TERM (BUT LIQUID) VALUE. The firm generally enters after a local partner has partially de-risked the investment but before standard metrics make the company an obviously good investment to purely financial investors. The firm prefers to lead initial investments of US $3-10 million. The firm does not believe board seats are inherently valuable, preferring to secure rights via observation and its financing documents. 4t INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET IO EFTA00591054 VALAR ADVANTAGES / INVESTMENT PROCESS DEAL SOURCING Andrew and James have sourced all of Valar's deals and will continue to find new companies and manage the portfolio. Peter provides advice to the firm and its portfolio companies. Valar intends to run a concentrated portfolio of 7-10 significant investments in each fund, aggressively following on in its winners. DILIGENCE U. INVESTMENT DECISION Investment decisions must be unanimous between James and Drew: Peter provides advice and counsel prior to and following the investment decision. ADVICE & MENTORING r.- INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 11 EFTA00591055 PORTFOLIO / XERO XERO - ACCOUNTING SOFTWARE AS A SERVICE FOR SMALL BUSINESS AMOUNT INVESTED: $3.0 mil VALUE AT 6/30/2014. 561.2 mil GROSS MULTIPLE. 20.4X AMOUNT INVESTED: $3.3 mil VALUE AT 6/30/2014: $33.2 mil GROSS MULTIPLE: 10.0X AMOUNT INVESTED: $20 mil VALUE AT 6/30/2014: $92.7 mil GROSS MULTIPLE: 4.6X AMOUNT INVESTED: $5 mil VALUE AT 6/30/2014: $7.5 mil GROSS MULTIPLE: 1.5X TOTAL AMOUNT INVESTED: $31.4 mil VALUE AT 6/30/2014: $194.7 mil GROSS MULTIPLE. 6.2% • Beautiful "scarping software SMALL BUSINESSES ACCOUNTANTS S BOOKKEEPERS M FEATURE TOUR ALL YOU NEED TO RUN YOUR BUSINESS Online accounting See Mr cediglow di neelenne. tut bglin anytime. art/wheys Try the world's easiest accounting software and you'll see why so many people around the world love xero ILE =ION • — 1L" °sea' C.) Gt *O. Sank reconciliation Invoking Add-ons AuMwretitelyinpRI and code Create end semi invents. Res Inane witie you/ bank ?ans.:Ions auloomdRaly & owl pad mint poerndid Odd-OnS- 1.• .4 sown more ROD DRURY: XERO FOUNDER / NEW ZEALAND Towns MUMS Mien let WerAnt0 "011 tibriniteS 410i June 30.2014 INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 12 EFTA00591056 PORTFOLIO / XERO THESIS The market for accounting software is large, growing and surprisingly untapped (with many consumers relying on ad hoc ledgers rather than formal software). Incumbent players, e.g. Intuit, are trapped in legacy architecture and have not successfully migrated to the cloud; they also view their accounting products as leaders for more profitable ancillary services and have under-developed their marquee products as a result. Because the opportunity for sales was large even without disrupting incumbents and because few investors were willing to underwrite a multi-year development cycle, Valar saw the opportunity for durable and compelling returns. HISTORY Based on the Valar team's reputation and Silicon Valley connections, a high profile New Zealand entrepreneur introduced one of Xero's directors to Valar in 2010. Valar was convinced that the founder had extraordinary execution abilities, a flair for sales, a plan for rapid global growth and the energy necessary to convert users away from entrenched systems. Xero's driven and experienced COO also gave Valar confidence that the firm would have the institutional heft to support the founder's vision. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS OUTCOME The firm has grown quickly, taking dominant positions in New Zealand and Australia. It has launched in the US and will continue to expand in the Anglophone world. Valuation rose from less than US $100 million at the time of Valar's initial investment to US $2.9 billion (based on publicly traded prices as of 6/30/2014). Xero is now approaching its liquidity window. WWW.XERO.COM CONFIDENTIAL & TRADE SECRET 13 EFTA00591057 PORTFOLIO / TRANSFERWISE TRANSFERWISE - LOW-COST CURRENCY TRANSFER SERVICES SERIES A INVESTED: $3.8 mil VALUE AT 6/30/2014: $23.1 mil GROSS MULTIPLE: 6.2X APR 2O14 / SERIES B INVESTED: $6.7 mil VALUE AT 6/30/2014: $6.7 mil GROSS MULTIPLE: 1.0X T-T rc.r TransferWise Send money Money Help & Support About Us Hey, hidden fees. Your secret's out. Sending money abroad is deceptively expensive, thanks to the hidden fees we've all been forced to pay. Now TransferWise lets expats. foreign students and businesses transfer money wherever it's needed, at the lowest possible cost. No hidden fees, no headache. FROM THE PEOPLE WHO BUILT ..A.;;Ij 8, feral 1000 Recel, 1,188.07 You'll get f 53.1 COckU KRISTO KAARMANN, TAAVET HINRIKUS: TRANSFERWISE FOUNDERS / UK nom omens Mon tee moans moo tiberutes es t JIM 50.2014 INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 14 EFTA00591058 PORTFOLIO / TRANSFERWISE THESIS OUTCOME The market for currency-driven financial services is high-fee for historical rather All metrics continue to show extraordinary growth — users, monthly revenues than technological or business reasons — and is thus ripe for disruption. The and transfer volumes (now nearing $200 million monthly) all grew over 7x partners know the space well from Andrew's and Peter's history at PayPal and during 2013. James' work at Clarium, giving them an informational advantage in the space. WWW.TRANSFERWISE.COM HISTORY Max Levchin, one of PayPal's co-founders and its CTO, referred the partners to the founders. The teams met several times, and the partners believed that Transferwise had the ideal combination of a strong technical bench, deep knowledge of finance, and a history of successfully building companies - Taavet Hinrikus was the first employee at Skype and Kristo Kaarmann had a long career at PwC and Deloitte helping financial institutions modernize their infrastructure. Valar led the company's Series A and Series B financings in rounds that closed in early 2013 and 2014, respectively. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET IS EFTA00591059 PORTFOLIO / VEND VEND - CLOUD-BASED RETAIL MANAGEMENT SOFTWARE MAR 2014 / SERIES D INVESTED: $8.6 mil VALUE AT 6/30/2014: $8.6 ro GROSS MULTIPLE: 1.0X yen' Tour Examples Pricing About - Resources - Sign In AbOut Us Careers Meula Blog VAUGHAN ROWSELL: VEND FOUNDER / NEW ZEALAND 'VEND SNRPSROT: IRTE P013 .goes peurte0 Imen tee gro” tom., es ot Aane w. 2014 INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS *it CONFIDENTIAL & TRADE SECRET 16 EFTA00591060 PORTFOLIO / VEND THESIS Traditional retail relies on archaic payment and management systems: while online stores have achieved various efficiencies, the much larger offline market relies on idiosyncratic, expensive and antiquated systems of cash registers, disparate software packages, and non-networked computers. By creating a point-of-sale system that both customers and retailers find easy to use and native to the cloud, Vend makes offline retailing more efficient and reliable (Vend even works when a store temporarily loses connectivity). Retailers no longer have to bear the high fixed and variable costs of ad hoc payment and retail management systems, freeing them to spend time on their area of highest competitive advantage: curating compelling off-line shopping spaces. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS HISTORY Vend was founded in New Zealand by Vaughan Rowsell, a programmer with a long history at emerging companies. Valar's partners met Vaughan while completing their first investment in Xero - a company Vaughan admired. Over the next two years, Valar followed Vend as it scaled in its home markets and expanded its team. Persuaded that the founder had both the deep technical knowledge to develop a comprehensive but intuitive retail system from first principles, complemented by a dedicated and business-savvy chairman, Valar led an expansion round of financing in 2014. OUTCOME The company has now opened offices in Australia, Canada, and the United States and growth is accelerating, with more than 8,000 stores now relying on Vend for their POS needs. WWW.VENDHO.COM CONFIDENTIAL & TRADE SECRET 17 EFTA00591061 PORTFOLIO / OPPA OPPA - SELF-BRANDED e-COMMERCE AUG 2C.77 SERIES B AMOUNT INVESTED: $8.0 mil VALUE AT 6/30/2014: $17.3 mil GROSS MULTIPLE: 2.2X SEP 2013 / CONVERTIBLE NOTE AMOUNT INVESTED: $5.3 mil VALUE AT 6/30/2014: $6.7 mil GROSS MULTIPLE:1.3X JUN 2014 / SERIES C AMOUNT INVESTED: $2.S mil VALUE AT 6/30/2014: $2.S mil GROSS MULTIPLE:1.0X I oPP0 NO s ...enaclas ihiSPRE SE gp OPPAOLOG 9 ....Icy, AVUILNILS' MIDVEIS • DECoRAcrAo • LITILIDADES • CAMA E BANI4O • MAIS VEND ', CD° TODD TOGO OPPA MAIS VENDOOS FILTRAR FOR "MAIS VENDIDOS" Foram encoMrados 123 prodinos Cotogodo In F49ov SO Odom. Pm P000letdoele V Amtionlos ML oio Dace:tact: Car:ern Sugoothoo do Sun EW"4191cao Fno I C.OR,. Urea Tun:Nona I Alruidada I Orpami I Seia_daLos MAX REICHEL: OPPA FOUNDER / BRAZIL fig", preurtell heren are trouSted von <flimsies es ot Jane XL 2014 INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET IS EFTA00591062 PORTFOLIO / OP PA THESIS The merger of high-end design, low-cost manufacturing, and elimination of traditional furniture industry middlemen allows Oppa to deliver both well- priced goods and comparatively high gross margins relative to other retailers. Direct sales, both online and offline, plus careful maintenance of lean inventory allow Oppa (much like Warby Parker in the US eyeglass market) to consistently exceed conventional industry margins. Brazil's import regime also favors domestic manufacturers like Oppa, providing additional barriers to entry for competitors (such as IKEA). HISTORY Oppa's founder had followed the Thiel team; contact was made and after several rounds of diligence, Valar invested. After Valar's first priced investment, Oppa came to the firm for expansion capital. Valar designed its follow-on investment to give the founder the time and flexibility to explore additional sales channels to accelerate growth otherwise unavailable with standard funding mechanisms. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS OUTCOME Oppa has grown rapidly, gaining market share by maintaining high-quality, fresh designs manufactured quickly and locally. Sales roughly doubled during 2013 and Oppa is well positioned to meet or exceed that growth in 2014. WWW.OPPA.COM CONFIDENTIAL & TRADE SECRET 19 EFTA00591063 PORTFOLIO / OTHER PORTFOLIO HIGHLIGHTS tlContaAzul SEP 2013 INVESTED: $0.9 mil VALUE: $0.9 mil GROSS MULTIPLE: 1.0X Valar's thesis for ContaAzul mirrors that it held for Xero: the demand for intuitive, web-based and well-priced accounting sof tware for smaller businesses issurprisingly underserved. This dynamic is especially pronounced in emerging economies with non-Anglophone accounting needs. Valar found the team earnest, open-minded to the Silicon Valley approach and cohesive (having previously worked together). Valar invested in September 2013 and traction has already been strong. WWW.CONTAAZUL.COM Canopy Labs granify NOV 2012/MARCH 2014 INVESTED: $0.7 mil VALUE: $0.7 mil GROSS MULTIPLE:1.0X Canopy Labs takes customer data and. applying a proprietary algorithm. allows companies to find and prioritize their most valuable customers and more efficiently target marketing campaigns. WWW.CANOPYLABS.COM AUG 2012/MAY 2014 INVESTED: $0.4 mil VALUE: $0.4 mil GROSS MULTIPLE: 1.0X Using Al and large data sets. Granify helps companies identify and convert the large population of users who visit commerce websites but fail to make a purchase - offering significant increases in conversion rates at effective costs. WWW.GRANIFY.COM omplica. NOV 2012/DEC 2013 INVESTED: $0.3 mil VALUE: $0.4 mil GROSS MULTIPLE:1.5X Descomplica is Brazil's largest on-line classroom and brings high-quality, data- driven classes to a wired, middle-income market underserved by traditional off-line education. The company now has more than 5.000 lessons and videos available and has served more than 4.5 million students. WWW.DESCOMPLICA.COM.BR Awes plimted Neem ere uniteOted von estmen of 01 Am 30. SC.I. Only a wilco of Yawl onion, coreparin Yo laud Net Masa canat thorMato Piactmont leceneaftlim be a “relplato to and pief4reNna of Gl Nettolo wrinnes. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 20 EFTA00591064 TERMS INVESTMENT PERIOD 5 Years LEGAL COUNSEL Cooley LLP TARGET SIZE MANAGEMENT FEES $150 Million 2.5% / year (subject to step-down) INCENTIVE FEE 20% scaling to 25%/30% at 3x/6x returns MINIMUM INVESTOR COMMITMENT AUDITORS $5 Million (subject to GP discretion) BOO GP COMMITMENT 1% of overall fund commitments (in addition to Peter Thiel's investment) INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 21 EFTA00591065 TERMS 915 Broadway, Suite 1101 New York. NY 10010 THIS DOCUMENT IS CONFIDENTIAL AND FOR QUALIFIED PURCHASERS ONLY. The information in this presentation may not be copied, reproduced or redistributed without the express written permission of Valar Ventures Management LLC (the "Sponsor"). This presentation is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use is contrary to local law or regulation. Nothing in this presentation should be construed as an offer to sell or solicitation of an offer to buy any securities and may not be relied upon in connection with the purchase or sale of any security. This presentation is not intended to provide. and should not be relied upon for. legal, tax. regulatory, investment, financial or accounting advice or investment recommendations. Any investment in a program offered by the Sponsor or its affiliates should be based on a careful review of the applicable offering memoranda and other governing documents (the "Offering Documents") containing detailed descriptions of the particular investment program, risks, fees and expenses. All statements herein are qualified in their entirety by reference to the Offering Documents. To the extent that this presentation contradicts the Offering Documents, the Offering Documents govern in all respects. Statements contained herein are made as of April 30, 2014 unless otherwise noted, and are subject to change without notice. The valuations. forecasts, estimates, opinions and projections contained herein involve elements of subjective judgment and analysis. There can be no assurance that the assumptions made in connection with such valuations. forecasts, estimates. opinions and projections will prove accurate. These materials may contain forward•looking statements that are subject to certain risks and uncertainties. The Sponsor undertakes no obligation to update these forward•looking statements for events or circumstances that occur subsequent to such dates or to update or keep current any of the information contained herein. Certain information and data contained herein are based on sources the Sponsor believes to be reliable, but such information has not been independently verified. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS AND SHOULD NOT BE RELIED UPON FOR MAKING AN INVESTMENT DECISION. ANY INVESTMENT IN A PROGRAM OFFERED BY THE SPONSOR OR ITS AFFILIATES WILL BE HIGHLY SPECULATIVE AND THERE CAN BE NO ASSURANCE THAT SUCH PROGRAM'S INVESTMENT OBJECTIVE WILL BE ACHIEVED. INVESTORS MUST BE PREPARED TO BEAR THE RISK OF A TOTAL LOSS OF THEIR INVESTMENT. Interests in the fund contemplated herein (the "Fund") have not been approved or disapproved by the U.S. Securities and Exchange Commission (the "SEC") or by the securities regulatory authority of any state or of any other jurisdiction, nor has the SEC or any other such regulatory authority passed upon the accuracy or adequacy of this presentation. Any representation to the contrary is a criminal offense. The interests in the Fund (the "Interests") have not been registered under the U.S. Securities Act of 1933, as amended (the 1933 Act"), the securities Laws of any state or the securities laws of any other jurisdiction, nor is such registration contemplated. The Interests will be offered and sold under the exemption provided by Section 4(2) of the 1933 Act and/or Regulation D promulgated thereunder and other exemptions of similar import in the laws of the states and jurisdictions where the offering will be made. INTRODUCTION / VALAR ADVANTAGES / PORTFOLIO / TERMS CONFIDENTIAL & TRADE SECRET 22 EFTA00591066