Overcoming Negative Perception through Industry Leadership

ELEMENTAI HC Haskayne Consulting Defining The Technology of Tomorrow Mr. JF Gagn , Chief Executive Officer; Mr. Yoshua Bengio, Co-Founder. January 2020 Montreal, Quebec, Canada Haskayne Consulting: Adam Schwarz, Mahwash Waqar, Gibson Yin, Graham Toombs

How to overcomer the negative public perception of fear to reduce sales cycle time and capture greater market share to become a world leader? For too long the narrative of the industry has been defined by others. HC Artificial Intelligence World Domination is a baseless fear that has haunted your industry and company 2

Executive Summary Issue Recommendation Cost (CAD) - Create face of company to create positive public perceptions - Introducing Aurora - Starts as person in public relations but becomes program (like Cortana) Organize industry and create an industry association to lobby government to create rules for and define industry - Artificial Intelligence Industry Association - Create ethical standards that all companies and programs adhere to (build consumer trust) $5 Million $100,000 How should ElementAI overcome the gross negative public perception? $500,000 - $50,000 - Work with long-term partners to find other areas of AI application to their business model Free Trail Version - Simple version only $5 Million How should ElementAI decrease the long sales cycle that dampers growth? - $100,000 - Focus on specific industry of revenue - Select Industrial Applications as this sector is growing rapidly in the AI space How does ElementAI capture significant market share and become a world leader in the Artificial Intelligence space? HC $10 Million 3

The Best Way Forward for AI The Best Way Forward for AI ElementAI needs to redefine the narrative in the public domain around the Artificial Intelligence industry and focus its business strategy to dominate specific applications HC Take back the power of the message and tell the world the pleasant and positive reality of AI 4

ElementAI as it is today Products to solve problems with AI All Services: Cloud to Heavy Manufacturing Big Industry Player Captured Entire Value Chain Deliver Service to Consumer HC Incredible innovation, but you ve hit a ceiling with market size due to public acceptance 5

We help enterprises operationalize artificial intelligence so that people and machines collaborate better - Mr. JF Gagn HC ElementAI goal is to become the world champion of Artificial Intelligence 6

Defining The AI of Tomorrow Find new opportunities with existing clients Introducing Aurora Consolidate AI Industry Focus Sales Strategy on specific high- growth industries Create Ethical Standards HC Organizing the industry and defining it in your terms will create the market to become a world leader in AI 7

Ethical Standards Framework 1. Protect privacy at all costs 2. Machines should benefit people 3. People should always have control over AI program 4. AI will not be used to suppress or harm people 5. AI should be focused on increasing prosperity for society HC A standard framework that all will abide by to increase positive legitimacy among general population 8

ELEMENTAI Double Click to Start Mahwash Waqar HC 9

AI In The New Technology Spectrum New technologies have outpaced other industries and regulators Massive and constant growth and evolution Even the practitioners are clamoring to understand implications AI expansion into manufacturing and service industries Negative perceptions among the public Viewed as intrusive and dangerous Lack of trust and transparency HC How to achieve the full potential of AI? 10

Element AI Montreal-based startup Phenomenal success for a 3-year-old startup Market has responded positively to the AI possibilities Mission Working smarter, together Operationalize AI so that people and machines collaborate better Solving operational problems and efficiency, going after new market opportunities with the help of AI interventions HC Attaining critical mass for success 11

Element AI: Critical Look What you do well? How can you grow? Unique Differentiator: Full stack company (research, build, sell, deliver, support) Large talent pool of 450 practitioners including data scientists and technocrats Global and regional clients from multiple industries (LG, Port Montreal, AISIN, etc.) B2B client understanding Actively creating awareness and education around AI capabilities Finding ways to consolidate and organize the evolving industry Reducing long sales time by entering into long-term contracts with your clients Humanizing and commercializing AI through education, industry consolidation and steady revenue streams 12

Alternatives Positive public image Reduced sales cycle Commercialize and Mainstream AI Market Leadership Proactive approach through public education, industry consolidation and focusing on specific industries with long- term partnership Yes Yes Yes Yes Acquire a competitor to expand into other sectors No Yes Yes No Continue operations as is and try to change the narrative independently No No No No HC A proactive approach 13

The Best Way Forward for AI The Best Way Forward for AI ElementAI needs to redefine the narrative in the public domain around the Artificial Intelligence industry and focus its business strategy to dominate specific applications HC Take back the power of the message and tell the world the pleasant and positive reality of AI 14

Recommendation On a company level - branding On an industry level - governance Focus on large industrial clients Long-term partnerships with existing clients Introduce Aurora, the face of the company Influencers, experts AI software Create an industry association that lobbies towards legislation Experience with B2B target audience Industrial sector Free trials of the software Long-term contracts for different arms of the business Business of choice Work towards consolidating the industry by creating industry standards 4-tier solution that dispels negative perception, introduces industry governance standards and focuses on large industrial clients as well as reduces long sales times HC 15

Ones and Zeroes 10011011001 . Gibson Yin HC 16

Element AI Financial Status 250 million fund raised 5 offices around the globe Partners across multiple industries Assume company is cash flow positive Challenges How to grow revenue and market share? HC 17

How Much For Your AI? Investment In Aurora and creating information content - $ 5 million/yr AI Industry Associate Cost - $100k/yr Develop AI Ethical Code - $ 50k once time Government Lobby - $ 1 million/yr Innovation To Better Work With Long-Term Partners - $ 5 million/yr Develop Free Trial Version - $100k one time Innovation in Industrial Sector AI Application - $10 million/yr HC $21.1 million/yr in recurring cost and $150k one time 18

Expected Result Grow revenue by 25% Year-over-Year Achieve 50% operating margin by 2022 Achieve 30% market share of AI business in the industrial sector Sustainable and established business model, provides option for exit for founder or continue growing business HC Growth in revenue, margin and market share 19

Avoid...Grow Through Acquisition Does Not Solve Perception Problem Monopoly will likely deter people from adopting AI STOP HC Does not help Element AI s current position 20

Avoid...Lobbying Alone Does not have the influence right now Industry standard makes everyone follow the same rule Makes the industry as a whole more accepted by all STOP HC Little traction from changing an ingrained perception individually 21

ELEMENTAI Run Code Graham Toombs HC 22

The Best Way Forward for AI The Best Way Forward for AI ElementAI needs to redefine the narrative in the public domain around the Artificial Intelligence industry and focus its business strategy to dominate specific applications HC Take back the power of the message and tell the world the pleasant and positive reality of AI 23

Industry Association Short Term (0-6 Month): Plan and host an industry conference with current AI industry companies Purpose is education, and also marketing to the companies Marketing has conversations with industry leaders Operations begins the development of the plan for consolidation Medium Term (6-12 Months): Marketing to reach out and bring all interested parties back into the room together Vote on the potential membership After 1 year, form the association Long Term (1-2 Years): Begin lobbying the government with the association and bring the regulations and standards into the industry Give complete transparency to consumers the entire way HC Consumers are scared, and don t need to be 24

Positive Public Perception Short Term (0-6 Month): R&D to begin building Aurora AI program Marketing to begin building an educational Youtube channel Hire additional social media personnel Marketing to build Internet ads based around Aurora A person in the short term, a program in the long term (that uses human likeness) Medium Term (6-12 Months): First Aurora ads to be aired on Youtube and internet video ads Making AI friendly Social Media team to build an Instagram and Twitter Youtube Channel to launch, person Aurora to lead series Long Term (1-2 Years): Person substituted with AI program when ready Marketing continues outreach efforts HC The public needs reassurance 25

Enter the Industrial Manufacturing industry Short Term (0-6 Month): Pivot the R&D department to focusing on industrial applications Marketing to reach out to current partners Find more work Inform of pending competencies Medium Term (6-12 Months): Marketing reaches out to the industrial area, informing of specialization R&D continues to specialize Current partners are interested parties to still be taken care of by consultants Long Term (1-2 Years): Heavily inform Industrial companies of potential cost saving avenues given by AI applications Use R&D HC Industrial applications are exploding, and you need to get in on the ground floor 26

MKTG finds specialized industrial partners Begin Aurora 2022 2020 Real Aurora Lobbying for regulation Find partners for the association HC R&D Continues 27

Risks and Mitigation Risks Probability Impact Mitigation Cybersecurity/IP theft H H Firewalls 2 Factor Authentication Digital Twinning Seen as manipulating the AI narrative for personal gains M M Positive Marketing Aurora Industry Association HC You can overcome these with mitigation 28

You Asked, We Answered 1) How do we as a company and an industry promote the opportunities created by AI yet address the perceived downsides? As a company, with positive marketing and outreach. As an industry, create the association to build rules around the development of AI, to give public relief and provide greater opportunities What are the risks associated with that and what are the risks if we don t address it? The risks are that if the association is not created, the perception will remain that it is possible to create an AI outside of any ruleset. The association provides mental safety to those worried about it. Who do you think our target audience is? Large companies for future business expansion, the general population for public perception change. Who are our natural or unnatural partners in creating this change? Large companies in mature industries (specifically as they can get cost savings where they previously could not have) are your natural partners Unnatural partners are any that will get little to no use, like education or film 2) 3) 4) HC The world is ready for this, they just need to know it 29

Print [Hello World!] Adam Schwarz HC 30

The Best Way Forward for AI The Best Way Forward for AI ElementAI needs to redefine the narrative in the public domain around the Artificial Intelligence industry and focus its business strategy to dominate specific applications HC Take back the power of the message and tell the world the pleasant and positive reality of AI 31

Executive Summary Issue Recommendation Cost (CAD) - Create face of company to create positive public perceptions - Introducing Aurora - Starts as person in public relations but becomes program (like Cortana) Organize industry and create an industry association to lobby government to create rules for and define industry - Artificial Intelligence Industry Association - Create ethical standards that all companies and programs adhere to (build consumer trust) $5 Million $100,000 How should ElementAI overcome the gross negative public perception? $500,000 - $50,000 - Work with long-term partners to find other areas of AI application to their business model Free Trail Version - Simple version only $5 Million How should ElementAI decrease the long sales cycle that dampers growth? - $100,000 - Focus on specific industry of revenue - Select Industrial Applications as this sector is growing rapidly in the AI space How does ElementAI capture significant market share and become a world leader in the Artificial Intelligence space? HC $10 Million 32