Phimentum Venture Assessment Term Sheet Proposal ENTR 6219

Phimentum Venture Assessment & Term Sheet Proposal ENTR 6219 Misael Carrasquillo, Kevin Harkess, Bryan Herring, Maddie Mc. Lean, Harshith Salian JUN 2020

Venture Assessment Framework (I) Phimentum Dimension Assessment Rationale Team • • Industry Experience No prior general business or start-up experience Value proposition • Clearly identifies accessibility & affordability Market opportunity • TAM = $67 B (15 M children x $4, 500 per treatment Solution • Patented solution Competitive position • • Offering braces at great access & a more affordable price Can work with children while liners cannot 1

Venture Assessment Framework (II) Phimentum Dimension Assessment Rationale Business model • • Revenue / B 2 B model is solid Unclear which portions are staying in-house v. outsourced Go-to-market plan • • No clear sales strategy or plan for customer acquisition Plan for only the next 6 months only confirming MVP works GTM now contingent on validation of pilot/solution Hiring consultants too early (what are they advising? ) Projections / ability to make money • • Unclear if Phimentum’s customers (the dentists) are making money Underestimating CAC costs. Only accounts for tooling & training but not the marketing and sales costs Is the amt reasonable v. venture’s achievement/potential? • • Lack of MVP Lack of execution Questions CAC No LTV Risks to the business • • Unproven founders Solution not validated yet (patient adoption: will they feel comfortable using the solution? ) GTM not fully developed Could there be pushback from orthodontists. • • 2

Term Sheet Proposal – Key Points Phimentum Ask: $1. 3 Million The Offer: Pre-Money Valuation: $1. 3 Million Our investment: • $650, 000 for 25% equity • $650, 000 from another VC for 25% equity Liquidation Preference: • 1 x the purchase price preferred • Pro-rata share with common on remaining amount Anti-Dilution: Issuance of shares at a value less than the purchase price, Seed will be entitled to a weighted formula. Conversion price reduced to the price of a new security. Board of Directors: • 4 seats total • 1 for each investor (2 total) • 2 from management / Phimentum Employee Pool: 15% post closing 3

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Pre-Money Valuation is based on the Step Up Model Phimentum Step Up Factor Yes Amount Market Size >$500 M $250, 000 Business Model Scales Well $250, 000 Founders have previous exits or significant experience More than one founder committed full-time MVP developed, customer development underway Business model validated by paying customers Significant industry partnerships signed Execution roadmap developed & being achieved IP issued or technology protected Competitive environment favorable GRAND TOTAL $500, 000 (2 patents) $250, 000 $1, 250, 000 5

Term Sheet – Full Detail Price • Pre-money - $1. 30 million • Post-money - $1. 30 million + 650, 000 Investment (each) for $1. 3 M total Liquidation Preference Pay 1 x the purchase price preferred and then on a pro rata share with common until fully liquidated. Rights Pro rata right based on the % equity ownership Protective Provisions 2/3 s of Series A to liquidate or wind up business, Amend bylaws, authorize new security, purchase/redeem capital stock issues prior to the series A, increase/decrease size of board. Counsel & Expenses: Pay all expenses up to $40, 000. Vesting Founder stocks deemed 50% vested with remaining 50% to repurchase at the Series A preferred price. Repurchase will decline monthly over 2 years. Employee Pool: 15% post-closing No Shop – 6 weeks Board of Directors 1 member from investors (each) and 2 from Phimentum, 4 board members in total Anti-dilution Issuance of shares at a value less than the purchase price, Seed will be entitled to a weighted formula. Conversion price reduced to the price of new security. 6

Proposed Cap Table values the company at $3 Million Shareholder Class Percent # of Shares Price Value Founder Common 42. 50% 1, 000 $1. 30 $1, 300, 000 VC 1 Seed Pref. 21. 25% 500, 000 $1. 30 $650, 000 VC 2 Seed Perf. 21. 25% 500, 000 $1. 30 $650, 000 85. 00% 2, 000 15. 00% 352, 941 Option Pool Common $2, 352, 941 $2, 600, 000 $1. 30 $458, 824 $3, 058, 824 7

Thank You