Ensure Profitability and Sustainability with XMU Consultancy Group

How To Ensure Your profitability & Sustainability? XMU CONSULTANCY GROUP SUSAN, GEORGE, ALEX, PHIL

Key Issues How To Ensure Your profitability & Sustainability? 1. Challenge 1: Additional Funding 2. Challenge 2: Marketing Expansion 3. Challenge 3: Shortage of Talent

Solution Market Driven +Big Data Talent Funding

Agenda Key Issues Analysis Alternatives & Recommendation Recommendation Implementation Risk & Mitigation Conclusion

Analysis Profile Vertical Farming Market(US$ B) 7 6.4 6 Largest vertical farm company in the world High market growth Globally. 5 4 3 1.97 1.5 2 1 0.41 0 2013 2016 2020 2023 Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Internal Analysis Strength Farm in urban areas, close market, reduce transportation cost, shorten produce to market cycle. Irrespective climate condition, least affected by climate change. Big data technology leverage tailor the produce, cut growing cycle time, remain unaffected by season and climate and help company grow globally. Patented technology provide new level precision and productivity, minimal environment impact, precision technology is future of farming. Weakness Product variety issue, only salad greens and no high-calorie grains High energy requirement, 10times more carbon footprint than traditional vegetable farms Highly depends on government subsides Talents limited, need sourcing and training Need train customer, mold customers interest Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

External Analysis Opportunity Demand growth globally, high population growth and urbanization. Trade war result each country to solve food production security, increase demand. Government encourage use of privately-owned land for urban farming Threat High level capital expenditure US government block international venture capitalist funding Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Competitor Analysis Competitor Type One Total Funding(US funding M) Company Type Employees Revenue(US Million) AeroFarms Bowery Farming Inc. Plenty Inc Gotham Greens Farms BrightFarms Inc. Lufa Farms Aeroponica 130 85 50 135 120 35 238 50 5 5 105 11.5 117,5 226 42.9 113.9 Hydroponic Aquaponic 5 7 Competitor Type Two Type Traditional Farm AeroFarms Cost Effective Less cost More cost Production Cycle Time Pest Issue Long Short Climate dependance High Low Energy Consuming Low High High pest issue No pest issue Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Alternatives Geography Market Expansion & Focus Fully usage big data analysis to improve efficiency & capability Increase Products Portfolio Expand sales channel to increase revenue

Alternative & Evaluation Geography Market Expansion & Focus Benefits Risks/Hurts Effectively increase revenue Mitigate the risk of Trade War Contribute to long term target solve food s problem Additional investment is required Right market selection to be considered A GO OPTION! Subject to Market Selection Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Alternative & Evaluation Fully usage of Powerful Big Data Analysis Benefits Risks/Hurts A GO OPTION BUT NOT ENOUGH! Cost down is predicted Capacity could be improved Sustainability Limit contribution to improve revenue Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Alternative & Evaluation Increase Products Portfolio Benefits Risk/Hurts Increase products profile Increase revenue Cater to diversified customer need Can t significantly change the situation of your company NOT A GO OPTION TO GO NOW! Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Alternative & Evaluation Expansion Sales Channel Benefits Risk/Hurts A GO OPTION But Cash flow to evaluated Increase revenue in short-term More reman resource is must Cash flow would be a new challenge to support the increase Right channel to be considered Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Recommendation Geography Market Expansion & Focus Go Fully usage big data analysis to improve efficiency & capability Go Increase Products Portfolio Expand sales channel to increase revenue Go Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Implementation Market Selection MKT SIZE LOW ENGERGY COST DEVELOPED LED INDUSTRY POLICY EXISTING RUNNING REDUCE TRADE WAR RISK CHINA Yes Yes Yes Yes Yes Yes NORTH AMERICA Yes Yes Yes Yes Yes No EURO - - - Yes No Yes REST OF WORLD No - No - - Yes Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Implementation- Expand to China What Expand China MKT as a JV company; Why The criterion based analysis; Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Implementation--Expand to China How Operation& HR A JV company with state-owned company; Get the support from government, such as, subsidy, policy, land support form; With 51% share holding; Funding locally, avoiding the funding unstable policy; Agriculture Experts from Israel and Netherland, the world-class talents; How--MKT Try to get Organic certification, by JV partners; The cooperation with famous hospitals in Beijing and Shanghai, and the high-end restaurants such as Haidilao hotpot; A campaign focus on No pest poise , and accurate ingredients nutrition The e-commerce platform alliances such as Hema fresh of Alibaba; Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Implementation-Big data What Make the full usage of big data to help company win the future Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Implementation--Big data How Operation& HR Strength cooperation with universities like MIT to analyze data and high-tech company like Dell to track new technology, promote the cooperation worldwide. Create the AI lab to manage the data and cooperate outside Organize the AI seminar to strengthen communication and technology sharing. Through different regions data to precisely pinpoint customer needs and delivery. Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Time mapping Items 2020 2021 2022 2023 2024 2025 2026 JV Organic Production base MKT campaign Big data Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Financial Analysis Funding money is increasing every year Most spending on reserch Face to the environment of economy, need sustain cash flow to maintain the company going Funding Hostory 3.5 120 3 3 100 100 2.5 80 2 76.5 2 60 1.5 1 1 1 40 36 1 20 20 0.5 2.15 0 0 2010 2014 2015 2017 2019 Financing times Amount of financing(US$M) Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Financial Forecast US$B US$B 2019 2026 2020 2026 Aerofarms Revene America China 0.05 0.57 industry value 1.97 12.27 0.23 0.34 60% 40% growth 36.54% per year According the implements what we did, focus on China get the revenue 60% of total revenue,40% from the America AeroFarm as a leader of the industry ,with a growth at 50% per year, from 0.05US$B in 2019 to 0.57 US $B in 2026 China with high profit margin is 40%,which can provide the cash flow from the key business Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Financing way To do the promotion in America and China with US 10 M Build 5 production Base in China with 2 years about US 50M Financing ways Equity financing in China Local stated- owed Company with 50M Build a JV company to operating China Market with 51% equities Equity financing in America for the American Market promotion with US$ 10M Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Risks Risk Probability Solution Policy of regulation M Go global to diversify Carefully monitor, increase funding ability and profit Cash flow break down M Perception of customers M Advertisement Alternatives & Recommendation Key Issues Analysis Recommendation Implementation Risk & Mitigation Conclusion

Conclusion Market Driven +Big Data Talent Funding

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