5.0. EDSR 03-11-2002 Item # 5
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city
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River
MEMORANDUM
TO: Economic Development Authority
FROM: Heidi Hall, Economic Development Assistant
DATE: May 13, 2002
SUBJECT: Business Incubator Application: KnowledGenetica, Inc.
Attachments
• Application & Product Descriptions - KnowledGenetica, Inc.
• Business Incubator Advisory Committee May 2, 2002 Minutes
• Elk River Business Incubator Member Company Selection Guidelines
• Issue
KnowledGenetica, Inc. has submitted an application for consideration of admittance to
the Elk River Business Incubator Program. The company would like to lease
approximately 2,000 sq. ft. of space in the Incubator for its business offices, business
data center, technology library, and product development and testing center. Joe
Roushar, Chief Technology Officer, will be in attendance to answer any questions the
EDA might have.
Background
The company is developing a universal human language translator that will be utilized
through computer software. The software has a number of key applications for
commercial, government, military, and personal use. The patent for the company's
technology was filed on May 2, 2002.
Mr. Roushar will present to the Elk River Investment Club and the Anoka/Sherburne
County Capital Fund on May 13th at 3:30pm.
The Business Incubator Advisory Committee reviewed KnowledGenetica, Inc.'s
application on May 2, 2002 with a finding that the applicant met the program
guidelines and is recommending that the company be admitted to the Incubator
Program.
Action Requested
Staff requests that the EDA consider the application of KnowledGenetica, Inc. for
admittance to the Business Incubator Program.
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• ELK RIVER BUSINESS INCUBATOR
APPLICATION FORM
Name of Business: K V10 W le d Coy'p rot )\oN.
Name of Principal: -TOS,e i0k C, K b(A S (Av-
Address: to / ) t,t) 1-1 L A vilovev' v S-5-30474.
Phone: (6(i ) 7 70- _2 2 3 7 Fax (76 3 3 2 7-2
Ownership structure: Sole Proprietorship ❑
Partnership ❑
Corporation
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Business is primarily involved in: Research and Development
Product Manufacturing/Assembly
Other
Principal product(s): ;5YL dome, illZS YL Poky Io�r
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Activities to be undertaken in the incubator facility: Q vtS t r(BScGGV `
LAS i,t1,55 4001.-6 ( vt1t, -:GL bto I o C' Lora '✓L
Pro to OI.E'< (of vimi4 L�.S t/t GG c
Projected number of employees (including principal) at incubator operation:
Full Time Part Time
Initially 2 `f
After 6 months
At the end of 1 Year 2,c �f
At the end of 3 Years
The Business has the following characteristics:
Advances Technology ❑✓
Projects Fast to Moderate Growth
Medical Related Product/Technology
Energy Related Product/Technology
If Business is a sole proprietorship, indicate principals net worth:
$0-- $24,999
$25,000 - $74,999 ❑
$75,000 - $99,999 ❑
$100,000 - $200,000 n
Greater than $200,000
List the amount of equity you have received to date in the form of stock ownership
and/or direct investment:
$0 - $24,999 $300,000 - $400,000
$25,000 - $74,999 / $400,000 - $500,000
$75,000 - $99,999 $500,000 - $1,000,000 n
$100,000 - $200,000 (l $1,000,000 - $1,500,000 [1
$200,000 - $300,000 ❑ $1,500,000 + up
List the amount of equity you will require from outside sources over the period of:
oneyear in the Business Incubator $ 5.00 k
• two years in the Business Incubator $ /0 vtcfl
The Business is currently in operation: Yes ,.// No n / 0
Current Location of Business `f7 4 1 MU, 1 '1'1 /?
7 *I (A,tic, vt oc" 5 S30if
Number of Years In Operation I
Current Number of Employees I FT , PT
Most Recent Annual Sales 4 2-SID _
The Business will require approximately it square feet of space in the
Business Incubator, with the following special needs/requirements:
-' /000 ✓- f t/o • '- 22002, 1 Q000 '2 -6 k 2 t d Lt i(' 02
• Please attach the following information:
• Business Plan, including financial projections, current sales figures (if any), Profit
and Loss Statement, and Balance Sheet.
• Personal financial statements
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Signature: _
Printe, name: 3.---C;s-cp 4 6. Pori Ito,
• Company name: K 140 tAite 6e kt - 4 i'cM. Co%0.
Date: 7` - 5—' 02
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I/TI natural language understanding software provides high-speed
accurate interpretation of speaker intent. Where speech-to-text systems
can read your lips, /Mean read your mind based on what you say.
This revolutionary software will change the nature of computing.
Today's systems require users to learn arcane command languages and
• difficult menu systems, then treat anything the user does differently as
"garbage" and spit back the epithet "Garbage in, garbage out". OW
goes the distance to understand what users really want and attempts to
deliver. When user intentions are unclear, instead of useless error
messages, /Al engages the user in clarifying dialogue to find out what
to do to meet the user's needs.
The promise of computers, to make our lives easier by eliminating
repetitive tasks and manage complex information in meaningful ways,
has finally been realized. From now on, instead of wrestling with too
much data and floods of disconnected information, /Inputs a world of
knowledge within your grasp.
/in works in conjunction with speech-to-text converters or takes
normal typed input to make computers both understanding and
responsive, unlocking their power to serve you better.
/in — (/rhering in the Age of Knowledge
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TM
Call centers need better automated tools to reduce the load on human agents
without alienating and confusing callers with complex prompts and buttons
to press. lin 1'n'Done brings speech enabled interactive voice response
systems to the next level of proficiency and understanding.
Now, instead of being constrained to a narrow set of keywords and
prefabricated questions, I$Yl can interpret what callers say with near-human
accuracy. Then with confirming, clarifying and extending questions, /ln
activates 1'n'Done to transact whatever business the user requests.
1m can sit in the interactive voice response system to handle requests
before they are routed to live agents, or even work in conjunction with an
agent. Ltn can listen in on the verbal exchange between the caller and the
• agent, retrieving needed information to present on the agent's screen, and
even whisper helpful prompts into the agents other ear. Agent training and
quality assurance will never be better.
/in l'n'Done
Maw the Age of Knowledge to the Coll Centel
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TM
//n Polyglot translates text from one language, to one or more other
languages with near-human accuracy. Other systems struggle to achieve
70% accuracy and are limited to one target language or one direction. //n
Polyglot will push the envelope to over 90% accuracy in either direction
and eliminate constraints on the number of target languages.
//I'l Polyglot'/revolutionary approach begins with the context of the
input and understands the semantics, syntax and every aspect of language.
The context processing, based on large networks of knowledge about the
real world, is the first computer software ever developed that can find the
right meaning when words and phrases have multiple meanings. There are
so many words and phrases that have multiple meanings that grammar-based
systems will never approach human accuracy. Before trying to translate it,
/I t Polyglot correctly interprets it.
• //71 Polyglot begins with a knowledge base that resembles yours. That's
the best place to start. Next, it uses lightening fast code to work at speeds
that far surpass any competitor's translation system. Consequently, besides a
bulk material translator for manuals, books and other large printed material
/1Tl Pol9glot can be used in real-time mode at multi-national events, in
call center systems, and even on the phone switch to permit real-time
translation for international calls.
I/TI Polyglot
Sting, the Age of Knowledge to the W(/o,/e/
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/lf'� KAEI/ is completely different. kill! stands for Knowledge
Appliance with an English Language Interface. This wearable computing
device, with speaker and microphone, combines the convenience of a palm
computer, a cell phone, a virtual private network, a dictionary, encyclopedia,
worldwide phone book, and a unified messaging system. Its combination of
voiceprint and fingerprint authentication make it the most secure portable
device ever made.
Imagine the possibilities: a KAEI/—enabled sales force can have instant
communication with their support people, answer tough questions and
download just the right materials and present them to prospective customers
on demand. Busy executives and knowledge workers can have their e-mail,
voice mail, faxes and attachments on hand everywhere without having to
carry around clunky equipment or ever turn it on or off. Just tell kill/not
• to interrupt unless it is really important and Kill! will act as a trusted
admin assistant to handle calls and keep business moving even when you are
out of the loop.
Sliding into specially designed clothing with built in microphones and
speakers, Kali/unobtrusively manages your schedule and contact list like
today's personal organizers, but never requires you to lift a finger. You can
focus your energy on important things and leave the information and
communication to Kill! Knowledge has never been more accessible and
communication never smoother.
11'11 KaUU
Sting, the flge of Knowledge to You
•
MEETING OF THE ELK RIVER
BUSINESS INCUBATOR ADVISORY COMMITTEE
HELD AT THE ELK RIVER BUSINESS INCUBATOR CONFERENCE ROOM
THURSDAY, MAY 2, 2002
Members Present: Jeff Gongoll-EDA Representative, Louise Kuester-EDA/Council
Representative, Larry Hickman-Business Incubator Partner & EDA Landlord
Members Absent: Stephanie Klinzing-EDA/Council Representative,Jim Barthel-Small Business
Representative, and Jack Mowry-Small Business Representative
Staff Present: Director of Economic Development Catherine Mehelich and Economic
Development Assistant Heidi Hall
Others Present: Joe Roushar and Warren Herreid-KnowledGenetica and Harlan Jacobs-
Genesis Business Centers
• KnowledGenetica, Inc.
Presentation: Joe Roushar, KnowledGenetica Chief Technology Officer
Mr. Roushar provided the Committee with personal background information, the history of
KnowledGenetica, and future projections for the company. In detail, Mr. Roushar explained
the company's symbol (logo), vision, mission, products, involved people and partners,
technical aspects, financing issues, and timeline.
Questions and Answers
Competition
Mr. Roushar explained that most of the company's competition, such as technology being
developed in Japan, is several years behind the technology currently being developed by
KnowledGenetica. The patent for the company's technology was filed on May 2, 2002.
Customers/Products
Mr. Roushar explained why UnitedHealth Group, Inc. is one of the company's top potential
customers and further clarified the three company products (1'n'Done, Polyglot, and Kaeli).
• 1'n'Done and Polyglot products will appeal to corporate customers, whereas Kaeli will appeal
.
to the average consumer. 1'n'Done brings speech enabled interactive voice response systems
to call centers, Polyglot translates text from one language to one or more other languages with
near-human accuracy, and Kaeli, a wearable computing device, is described by Mr. Roushar as
"a palm computer on steroids".
Financing
Inquiries were made concerning the financial aspects of the company. Mr. Roushar answered
questions regarding KnowledGenetica's projected 2004 revenue and potential investors. Mr.
Roushar mentioned that he is currently working to schedule a presentation for the Elk River
Investment Club and the Anoka/Sherburne County Capital Fund.
Employees
Cathy Mehelich asked about the types of employees that KnowledGenetica is planning to hire
once the company has potentially moved into the Incubator. Mr. Roushar said that several
semi-skilled computer software designers would be hired. The projected number of initial
employees will be two full time and four part time employees. After six months, there will be
eight full time and four part time employees. At the end of one year there will be twenty-four
• full time and four part time employees.
Space/Electrical Needs
Mr. Roushar feels that Suite 120 would best fit the company's current and future space needs.
The suite also appears to be wired for adequate computer access.
Larry Hickman agreed to work with the EDA to amend the current Incubator lease since the
EDA currently does not lease Suite 120.
Recommendation
Advisory Committee members Larry Hickman, Louise Kuester, and Jeff Gongoll
recommended that the EDA consider KnowledGenetica, Inc. for admittance into the Business
Incubator Program.
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ELK RIVER BUSINESS INCUBATOR
MEMBER COMPANY SELECTION GUIDELINES
The primary purpose of the Business Incubator is to provide inexpensive space and support
for higher technology, (start-up and existing) small companies whose success would add
significantly to the growth and diversification of the City of Elk River's economic base.
The Elk River Economic Development Authority (EDA) will, as its primary objective, select
companies which appear to have the necessary fundamentals established to assure their
future growth and success.
Basic Entry Guidelines
The following basic entry guidelines will be used to determine the eligibility of
applicants to the Business Incubator:
1. Retail/service businesses will not be considered.
2. Businesses which compete exclusively in the local market with other similar
• local businesses will not be considered.
3. Manufacturing/assembly businesses will be screened to assure,the facility is
able to accommodate their intended process and byproducts.
4. Companies marketing new products/technology in the energy field are
encouraged to apply.
5. Companies must be involved in product manufacturing/assembly or be high
technology-service related.
6. The principals must have substantial technical and/or managerial skills, or
demonstrated experience and education in the product field.
7. Companies must clearly demonstrate a need for incubator services.
II. Specific Application Guidelines
Evidence of the following specific guidelines is to be provided at the time of
application to the Business Incubator:
1. Companies will be required to give hiring preference to persons meeting
certain eligibility requirements.
2. Companies will be required to allow opportunities for local businesses to
manufacture products for the company.
3. Existing companies will be considered for incubator occupancy if either (a) it
is deemed that circumstances clearly indicate that a move to the incubator
• will help retain and/or create jobs in Elk River that would otherwise be lost,
and if those circumstances are considered to be the result of factors other
than poor management or inadequate technical skills, or (b) the aim is to
• begin a research and/or production effort that is new and for which there is
inadequate space in the company's present facility.
4. Companies must be able to demonstrate credible projections which show
significant job creation and growth.
S. Companies must have a prepared and legally acceptable stock "offering
statement" prior to entry into the business incubator.
6. Companies must agree to a stock "barter" transaction whereby the EDA,
building owner, and business incubator consultant would be provided
company stock in lieu of services rendered
7. Upon acceptance, member companies must agree to retain operations of the
company within the City of Elk River for a specified period of time.
8. Companies are required to have a completed business plan and a working
product prototype prior to acceptance into the incubator.
Considerations which enhance a companies eligibility for admittance to the Business
Incubator:
1. Companies are considered to have the potential of creating significant
employment opportunities in Elk River in the near future, provided that such
business projections are deemed to be realistic.
2. Companies are involved in higher technology or energy technology related
products.
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eda\bincapp.doc