BUSINESS

DEVELOPMENT PLAN
Imagine a world where anyone can profit by joining a massive processing and
storage space. Powered by Artificial Intelligence to connect users to services and
decentralized applications. Easy to use features and functionalities are synced
across all smart platforms. Whether you are a single user or a full blown enterprise.
We provide you fully secured cloud services that are catered to your needs.

WWW.IAGON.COM
V3.6
TABLE OF CONTENTS

1.0 EXECUTIVE SUMMARY 5

2.0 THE COMPANY 7

2.1 IAGON PLATFORM 7

2.2 BUSINESS MODEL 8

2.3 SALIENT FEATURES OF IAGON SERVICES 9

2.4 OPERATIONAL PLAN 10

2.5 LEADING TECHNOLOGY 10

2.6 TARGET MARKET 11

2.7 REVENUE STREAMS 11

2.8 BUSINESS OWNERSHIP 11

2.9 FUNDING VS. REQUIREMENT 11

3.0 WHY IAGON ? 12

3.1 MARKET NEEDS 12

3.2 CLOUD COMPUTING-COST CUTTING TECHNOLOGY 12

3.3 HARNESSING THE INNOVATIVE BLOCKCHAIN TECHNOLOGY 13

3.4 BIG DATA: THE NEXT FRONTIER FOR INNOVATION 14

COMPETITION, AND PRODUCTIVITY

4.0 MARKET ANALYSIS 15

4.1 CLOUD COMPUTING INNOVATION 15

4.2 MARKET SIZE 15

4.3 CLOUD COMPUTING TRENDS 15

4.4 CLOUD COMPUTING FORECASTS 16

4.5 MARKET GROWTH RATE 19

4.6 TOP PUBLIC CLOUDS USED 20

4.7 TOP PRIVATE CLOUDS USED 20

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4.8 GROWTH OPPORTUNITIES FOR CLOUD COMPUTING SEGMENTS 21

4.9 GLOBAL CLOUD COMPUTING SCORECARD 21
4.10 BIG DATA 22
4.11 BIG DATA: A NEW COMPETITIVE ADVANTAGE 22
4.12 WHY IS BIG DATA ANALYTICS IMPORTANT ? 23
4.13 BIG DATA TECHNOLOGIES AND SERVICES WORLDWIDE 23
4.14 ARTIFICIAL INTELLIGENCE (AI) 24
4.15 WHY HAS AI EMERGED AS A LARGE INDUSTRY NOW ? 24
4.16 ARTIFICIAL INTELLIGENCE INDUSTRY SIZE 25
4.17 OTHER HARDWARE AND SERVICES REVENUE BOOSTED BY AI 26
4.18 SUPPORT FOR AI FROM GOVERNMENTS 27
4.19 AI THE NEXT DIGITAL FRONTIER ? 28
4.20 BLOCKCHAIN TECHNOLOGY ADOPTION & GROWTH 29
4.21 BLOCKCHAIN TECHNOLOGY TRENDS 30
4.22 TYPES OF BLOCKCHAIN NETWORKS 30

5.0 COMPETITIVE LANDSCAPE 32

5.1 NUMBER OF COMPANIES IN THE INDUSTRY 32
5.2 SCOPE OF COMPETITIVE RIVALRY 33
5.3 CUSTOMERS 35
5.4 EASE OF ENTRY/EXIT 35
5.5 COMPETITIVE EDGES 36

6.0 SWOT ANALYSIS 37

7.0 MARKETING STRATEGY 39
7.1 MARKETING TARGET 39
7.2 CONTENT MARKETING 39
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7.3 PRINT AND ELECTRONIC MEDIA MARKETING 40

7.4 INTERNET MARKETING STRATEGY 40
7.5 MARKETING BUDGET 41

8.0 PERSONAL PLAN 41

8.1 ORGANIZATION ORGANOGRAM 42

9.0 FINANCIAL ANALYSIS 42

9.1 FINANCIAL ASSUMPTIONS 42
9.2 CAPITAL EXPENDITURES 43
9.3 REVENUE PROJECTIONS 43
9.4 FIVE YEARS PROFIT & LOSS PROJECTIONS 44
9.5 PROJECTED CASH FLOW 45
9.6 BREAK-EVEN ANALYSIS 47

10.0 APPENDIX 48

10.1 MONTHLY PROFIT & LOSS PROJECTIONS OF FY-1 49

10.2 QUARTERLY PROFIT & LOSS PROJECTIONS 49

11.0 DISCLAIMER 50
1.0 EXECUTIVE SUMMARY

INTRODUCTION
IAGON is a platform for harnessing the storage capacities and processing power of multiple smart devices
over a decentralized blockchain/tangle grid. IAGON utilizes and enables storing big data files and repositories,
as well as smaller scales of files, and carries out complex computational processes, such as those needed for
artificial intelligence and machine learning operations. IAGON operates a fully secure and encrypted platform
that integrates Blockchain/Tangle, cryptographic and Artificial Intelligence (AI) technologies in a user-friendly
way. We focus on delivering Decentralized Cloud Computing and Artificial Intelligence services. In order to
develop the IAGON platform, we continuously use cutting edge technologies, including machine learning, big
data, data mining, decentralized and distributed systems, as well as Blockchain and tangle technologies.
Under IAGON’s platform you can imagine a world where anyone can profit by joining a massive processing grid.
IAGON will provide a fully automated platform for carrying out the storage and processing tasks of users on the
basis of unutilized storage and processing capacities that are contributed by the “miners”. The miners will be
able to convert the tokens back to fiat money, to accumulate them or to pay for similar services that they need
with the tokens. For each transaction, IAGON will charge 10% commission and the rest of the tokens will be
transferred to the miner. This decentralized cloud platform will operate two grids, i.e. a storage grid and a
processing grid. Both grids operate on a Blockchain platform powered by Machine Learning capabilities to
optimize the allocation of tasks and files to miners.

LOCATION
IAGON is a company legally registered in Hamar, Norway and will provide its services globally.

LEADING TECHNOLOGY
IAGON uses the world’s leading technology for developing and establishing two online grids to connect users
that demand storage capacities for Big Data and large processing capabilities for Artificial Intelligence
computations. The allocation of storage space and computational tasks to miners who contribute unused
storage and processing capacities will be conducted via a series of Machine Learning (ML) algorithms. The
processing tasks will be largely distributed to miners on the processing grid according to the characteristics
of each task and its creator (the user). The results will be stored and managed on the Blockchain and will be
visible only to the user that initiated it.

OBJECTIVES
IAGON aims at revolutionizing the cloud industry by providing a fully secure and decentralized cloud storage
and processing platform based on the Blockchain and Tangle technologies.

TARGET MARKET
User Market - IAGON’s main share of the user market consists of corporates, public institutes and SMEs that
require large secure storage and processing capacities (including cloud services, database storage, historical
data archiving, data analytics, batch processing, etc.).
Miner Market - The major part of the miner market consists of data centers that do not fully utilize their
storage and server capacities and can dedicate portions of them to IAGON’s grids.

MISSION
IAGON aims at supporting the growing demand for cloud computing due to the emergence of Big Data storage
and Artificial Intelligence processing by developing and providing decentralized cloud computing based on the
Blockchain.

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1.0 EXECUTIVE SUMMARY

VISION
Our vision is to provide a safe and secure cloud service powered by Artificial Intelligence and Blockchain/Tangle
technologies. Our goal is achieved through the integration of information technologies across all smart devices
and platforms, thus creating a seamless experience that fully serves the specific needs of its users.

SALIENT FEATURES OF IAGON SERVICES

• Provision of cloud computing for processing tasks and for storage by joining the abundant computational
capacities that are not used by personal smart device owners and data centers (CPU, GPU and disk
space).
• The storage and the processing will be fully protected by encryption on the Blockchain, and therefore
they are 100% secure and resistant to hacking.
• 24/7 operation of the storage grid, the processing grid and the Blockchain/Tangle.
• Attracting large numbers of users and miners to match the demand and supply of storage and processing
power.
• Valuation of the IAGON token.
• Harnessing together the storage capacities and processing power of multiple smart devices over
a decentralized Blockchain grid.
• Unique proprietary, secure and encrypted distributed storage solution that utilizes the Blockchain/Tangle
and sharding protocols.
• Trusted and integrated decentralized applications within a single platform that serves any type of users
from Fortune 500 companies, through SMEs to daily users.
• Miners generate revenue on our platform by sharing their smart device’s resources, including storage and
computing power.
• We use a combination of machine learning algorithms, neural networks and the Blockchain/Tangle
to develop a reliable, secure and efficient platform.
• Integrated cryptocurrency wallets help manage the transactions across different decentralized
applications.

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2.0 THE COMPANY

IAGON is a platform for harnessing the storage capacities and processing power of multiple smart devices over
a decentralized Blockchain/Tangle grid. IAGON utilizes and enables storing big data files and repositories, as
well as smaller scales of files, and carrying out complex computational processes, such as those needed for
Artificial Intelligence and Machine Learning operations, within a fully secure and encrypted platform that
integrates Blockchain/Tangle, cryptographic and Artificial Intelligence (AI) technologies in a user-friendly way.
Cloud computing is an emerging computing paradigm that enables both information technology infrastructure
and software to be delivered directly over the Internet as a service. IAGON delivers these services by utilizing
the vast capabilities of Artificial Intelligence to connect users to services and decentralized applications in a
secure and efficient way. Easy to use features and functionalities are synced across all smart platforms for
single users or full-blown enterprises.
As the impact of AI and Big Data technologies on every field of our daily and professional lives increases, IAGON
focuses on the delivery of Decentralized, Cloud Computing and AI services that fulfill this growing demand. We
continuously implement cutting edge and evolving technologies, including Machine Learning, Big Data, data
mining, decentralized and distributed systems, as well as the Blockchain/Tangle technology. The decentralized
nature of the IAGON platform opens a world where anyone can profit by joining our massive processing and
storage platform. Users can benefit and enjoy a share of the revenues.

2.1 IAGON PLATFORM

IAGON is developing a secure platform for cloud computing services that are supported by the Blockchain
technology (eventually Tangle as well), which fulfills the following aspects of its operation:
• Secure and decentralized storage of data and files on a grid of data centers and smart devices that
contribute their unused storage capacities to generate profits.
• Secure altering of computational processing tasks and programs by utilizing unused processing power of
smart devices and servers on a processing grid during their idle time (including both CPUs and GPUs).
• A crypto-token system that enables users of the storage and processing grid to pay for services that they
consume (i.e. securely storing files and processing information) while those who contribute their resources
to the grids benefit from these tokens. The tokens can be traded and converted to money via cryptocurrency
exchanges.
Currently, the market is dominated by four major players: AWS, Google Cloud, Microsoft and IBM which all utilize
central and less trusted storage and computation facilities. Due to their oligopolistic dominance, the four
providers of cloud services set high pricing levels. These providers are also capable of hampering any competition
and preventing new market entrants from competing with them, due to the broad scale of their operations and
their substantial investments in data centers, servers, storage facilities and marketing. IAGON is able to compete
with these companies by uniting multiple unused smart device resources into one grid and offering decentralized
storage capacities and processing power over the Blockchain/Tangle grid with a competitive and lower pricing.

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2.2 BUSINESS MODEL
The cloud services market that provides both storage capacities and computational processing capabilities
to companies and to corporates is estimated by 45 billion USD per annum and is characterized by ongoing and
steady growth. The demand for computational processing and storage capacities is expected to dramatically
increase in the near future due to two major trends in the business and computing worlds: Big Data and
Artificial Intelligence.
IAGON’s major aim is to revolutionize the cloud and web services market by offering a decentralized grid for
storage and processing tasks. By joining the unused storage capacity of servers and personal smart devices
and their processing power into one computational grid and allocating processing tasks and uploaded files,
we can create a super-computer and a super data center that can compete with any of the current cloud
computing moguls. Our solution is based on joining multiple servers and smart devices by utilizing their free
storage capacities to store file fragments in an anonymous and highly secure manner and by operating their
processors during idle times for parallel conduction of allocated tasks. Powering the computational
processing and storage grid with the Blockchain/Tangle technology ensures the complete security of both
miners and users, their anonymity and privacy and the complete integrity of the tasks and the files
transferred, processed and stored on IAGON’s Smart Computational Grid (SCG).
Consumers of these services – both companies and individuals – can enjoy vast storage and processing
capacities at a fraction of the market prices on a fully secured cloud platform. We overcome any entry
barriers imposed by the high level of investments required to compete in this market, by connecting data
centers, business computers and personal users and utilizing their free storage capacities and their CPU and
GPU processors in a seamless manner during idle times.
Three major aspects of the developed platform are addressed by IAGON’s technology and solutions:
• Big Data is the collection, management and storage of vast amounts of information obtained from any
internal or external sources (such as the company’s IT systems, social networks, sensors, medical
instruments, production line machinery and so on). The data management of companies promotes
collection and storage of any data related to its operations, clients and competitors should a need to
analyze any of these data ever present itself.
• Artificial Intelligence is a collection of mathematical and statistical methods that “learn” from data on
previous operations, finds patterns and business rules and predicts future behavior. AI-based processes
require vast amounts of computations and consume significant processing power of CPU and GPU
processors. The demand for storage and for processing power is expected to exponentially increase with
the broadening use of AI applications in new areas and with the widespread adoption of data collection
from multiple channels (such as sensors, social networks, data providers, etc.) and later with their
advanced processing and analysis.
• IAGON’s Token Economics is based on smart device, server and data center owners who join the storage
and processing grids. In return for sharing the capabilities of their machines, they will be granted IAGON
tokens that can be converted back to fiat money. Any party who wishes to utilize the storage and
processing capabilities provided by our decentralized cloud platform will purchase IAGON tokens to
distribute them to the contributors of the grid (i.e. “miners”) that provide their services to the grid. The
storage mechanism will be based on blockchain encryption and delivery of encrypted file fragments to
multiple storage facilities, so that none of the attributes of the file slices (origin, name, owner, data,
storage place, etc.) can be identified or deciphered by any party, other than the user who uploaded the
original file. Miners can publish their skills and their free storage and processing capacities and can offer
their service on the basis of their experience, available resources and storage space and bidding on
price. Advanced Machine Learning and AI algorithms will assist in recommending prices to users and
miners connected to the Smart Computational Grid (SCG) and will classify them according to their price
levels, continuity of services and access to files. Investors and holders of the IAGON tokens are likely to
benefit in the long run due to the increasing network externalities of the growing adoption of the
technology and its use. As more and more companies recognize the benefits of IAGON’s platform for
storing files and processing them, the demand for these services will increase and so will the demand for
the token – the way users pay the miners on the Smart Computational Grid (SCG).

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2.3 SALIENT FEATURES OF IAGON’S SERVICES
• IAGON provides cloud computing services for processing tasks and for storage by joining the abundant
computational capacities that are not used by personal smart device owners and data centers (CPU,
GPU and disk space) in a decentralized manner.
• 100% Secure Storage and processing of computational tasks, fully protected by encryption on the
Blockchain, and therefore files stored via the Smart Computational Grid (SCG) are 100% secure and
fully resistant to hacking.
• 24/7 operation of the storage grid, processing grid and the Blockchain/Tangle are guaranteed by our
platform. The decentralized nature of our Blockchain-based services ensures 100% availability of the
stored files, without any “blackouts” (technical failures preventing access to files) that often happen in
other centralized cloud platforms by applying Machine Learning techniques and predictive analytics for
forecasting and preventing these events.
• Storage and processing power are provided with minimal operation and energy costs by attracting
large numbers of users and miners to match their demand and supply of storage and processing power.
• Storage capacities and processing power link multiple smart devices over a decentralized Blockchain/
Tangle grid. The platform forms a fully secure computational “power grid” that links between the smart
devices and servers of miners and users for data transfers, storage and processing.
• Valuation of the IAGON token.
• Unique proprietary, secure and encrypted distributed storage and processing solution utilized the
Blockchain/Tangle and file sharing protocols.
• Support for both CPU and GPU based processing, essential for AI and advanced Machine Learning
tasks, such as the operation of complex Artificial Neural Networks and Deep Learning, as well as
supporting more conventional data mining techniques.
• User Friendly Platform for trusted operations of decentralized applications on a single platform for
every type of users - from Fortune 500 companies and SMEs to daily users.
• Miners that are connected to our platform can generate substantial static streams of revenue sharing
free storage and computing power of their smart devices and servers.
• The combination of Machine Learning and Artificial Intelligence algorithms, neural networks and the
Blockchain/Tangle used to optimize the allocation of stored files and processing tasks to miners
connected to our Smart Computational Grid provides a reliable, secure and fully accessible platform.
• Integrated cryptocurrency online wallets assist in managing transactions across different
decentralized applications.

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2.4 SALIENT FEATURES OF IAGON’S SERVICES
IAGON will provide an automated platform for carrying out the storage and processing tasks of users on the
basis of unutilized storage and processing capacities that are contributed by the miners. Users willing to
carry out storage and processing tasks will purchase IAGON tokens (traded via cryptocurrency exchanges)
and will use them to pay the miners for the services that they consume. The miners will be able to convert
the tokens back to fiat money, to accumulate them or to pay for similar services that they need with the
tokens. For each transaction, IAGON will charge 10% commission in IAGON tokens to support its operations
and its ongoing R&D efforts. The rest of the tokens (90%) will be transferred to the miners and distributed
between them according to the amount of their resources that serves the user’s operations. This
decentralized cloud platform will operate two grids: a storage grid and a processing grid, both run on a
Blockchain/Tangle platform powered by Machine Learning capabilities to optimize the allocation of tasks
and files to miners. In addition to operating the grids and the Blockchain, IAGON will conduct research and
development in the fields of Blockchain/Tangle technologies, security, Big Data and Artificial Intelligence to
continuously learn from its Blockchain/Tangle operations and improve the performance of its grids and the
allocation of storage and processing tasks to miners.

Blockchain Cryptographic
Big Data Crypto-Token & Artificial Intelligence
system Technologies

IAGON

Business Operation

2.5 LEADING TECHNOLOGY

IAGON establishes two online grids to connect users demanding storage capacities for large processing
capabilities for Artificial Intelligence computations, such as Machine Learning and Deep Learning and for
processing vast Big Data databases, as well as more conventional storage and processing tasks of any size
(such as SQL queries). The allocation of storage space and computational tasks to miners who contribute
unused storage and processing capacities will be conducted via a series of Machine Learning (ML)
algorithms. The ML will assess the availability of these resources for different types of accessibility (such as
24/7 accessibility, archiving old files, etc.) and will also store and manage copies of them on different miner
locations for maximal redundancy. The files will be fully encrypted, sliced and distributed to multiple
locations for maximal security and privacy of the files. Their identity and reference to the original file will be
secured on the Blockchain and will be accessible only to the user that uploads the file to the grid. Similarly,
processing tasks will be largely distributed to miners on the processing grid. The nature of each task, as
well as its creator (the user) and its end result will be stored and managed on the blockchain and will be
visible only to the user that initiates it.
Importantly: IAGON’s operations will be operated and supported by both the Ethereum Blockchain and the
new and innovative Tangle technology.

10
2.6 TARGET MARKET
• User Market - IAGON’s major market share consists of corporates, public institutes and SMEs that
require large secure storage and processing capacities (including cloud services, database
storage, historical data archiving, data analytics, batch processing, etc.) and a high level of security.
• Miner Market - The major part of the miner market consists of data centers that do not fully utilize
their storage and server capacities and can dedicate portions of them to IAGON’s grids to generate
additional profits.

2.7 REVENUE STREAMS

IAGON will charge a 10% commission in IAGON tokens from every transaction that users carry out to utilize
the miners’ storage and processing capacities.

2.8 BUSINESS OWNERSHIP

IAGON is owned by 4 founders and is registered as a Norwegian company. Dr. Navjit Dhaliwal,
Bogna Kaczmarek-Dhaliwal, Dr. Claudio Lima, and Dr. Elad Harison.

Dr. Navjit Dhaliwal: CEO

Dr. Elad Harison: COO & Chief Architect

Dr. Claudio Lima: CTO

Bogna Kaczmarek-Dhaliwal: Silent Partner

CanPol AS (Company co-owned by Navjit and Bogna);

Dr. Elad Harison, Dr. Claudio Lima, Dr. Rohit Gupta

2.9 FUNDING VS. REQUIREMENT

The founders invested a seed capital of 190,000 Euros.

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3.0 WHY IAGON?
3.1 MARKET NEEDS
The global market is going to experience exponential growth in the demand for low-cost and reliable storage
with the increasing collection and generation of huge volumes of data. For example, corporates are expected
to collect large amounts of omni-channel (meaning: multiple channel) data about customers and competitors.
Other data will be collected from IoT devices, such as sensors, medical devices, autonomous cars, Industry 4.0
controllers, smart home systems and more.

Companies will need to analyze these vast amounts of data by applying advanced analytics and Artificial
Intelligence techniques to derive managerial, operational, business and functional insights to react to changes
and trends in their environment. The application of AI-based tools (such as Machine Learning and Deep
Learning) requires vast processing power. Additionally, many companies gradually shift from on premise
architecture of their information systems to cloud computing. Thereby, IAGON’S solutions will support all these
trends.

3.2 CLOUD COMPUTING-COST CUTTING TECHNOLOGY

Cloud computing is a cost cutting technology for businesses. It is based on the use of computing resources
that are delivered to customers with the help of Internet technologies and communications, regardless of their
locations. When a company moves to a cloud-based service model, in practice it moves away from the
traditional capital expenditure model to an operating expenditure model. Cost cutting is a major task for the
CFOs for the smooth running of their business, where most of the times the IT budget is a worrisome matter
for them. It is difficult to manage the IT Infrastructure with a small number of IT workers within the
organization to keep on changing, maintaining and managing the IT infrastructure of the company.
Additionally, most of the costly IT hardware is employed for occasional computing purposes and is not fully
utilized. For each and every node, smart device or server, IT people spend long hours installing, configuring and
making it ready for the use. Consequently, businesses that are clearly concentrating through their online
portals find it scaling up their operations difficult. Agility, performance and capacity planning become
increasingly difficult for IT managers to handle. IAGON will provide very cost effective and reliable solutions to
the CFOs, IT managers, and CEOs in any sector.

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3.3 HARNESSING THE INNOVATIVE BLOCKHAIN TECHNOLOGY
The Blockchain is an undeniably ingenious invention, which created the backbone of a new type of Internet
communication. Originally devised for the digital currency, Bitcoin, the tech community is now finding other potential
uses for the technology. Bitcoin has been called “digital gold” and for a good reason. To date (as of February 9th, 2018),
the total value of the currency is close to $142 billion USD. Yet, the Blockchain can make other types of digital value
as well.

A verified transaction
can involve
cryptocurrency, cryptocurrency
contracts, records,
or other information

Validation
Someone requests The network of nodes validates the
a transaction The requested transaction
transaction and the user’s status
is broadcast to a P2P network Has no intrinsic value
using known algorithms
consisting of computers, in that is not redeemable
Known as nodes for another commodity
such as gold
Once verified, the transaction
is combined with other
Has no physical form
transactions to create a new
and exists only
block of data for the ledger
in the network

The new block is then added to the existing blockchain,

in a way that is permanent and unalterable

The transaction
is complete
Its supply is not
determined by a central
bank and the network is
Source: https://blockgeeks.com/guides/what-is-blockchain-technology/
completely decentralized

The Blockchain sphere offers the following unique benefits:

• Decentralization - This is a core concept and benefit of Blockchain: There is no need for a trusted third party
or intermediary to validate transactions, but rather a consensus mechanism is applied to agree on the
validity of transactions.
• Transparency and Trust - As Blockchain is a shared ledger and everyone can see what is on the blockchain,
the architecture allows the system to be transparent and, consequently, trust is established. This attribute is
relevant when disbursement of funds or benefits with personal discretion is of importance.
• Immutability - Once data is written into the Blockchain, it is extremely difficult to modify them. Unauthorized
changing of data is extremely difficult and virtually impossible, thereby maintaining an immutable ledger of
transactions.
• High Availability - As the system is based on thousands of nodes inter-connected in a peer-to-peer network
and data is replicated and updated on every node, hence the system becomes highly available. Even if nodes
leave the network or become inaccessible, the network as a whole continues to work, thus making it fully
available at any time.
• Highly Secure - All the transactions on the Blockchain are secure at the highest cryptographic level and
provide complete data integrity.
• Simplification of current paradigms - The current model in many industries (such as finance and healthcare)
is rather disorganized, as multiple entities maintain their own databases. Data sharing can become very
difficult due to the disparate nature of the systems. Nonetheless, as the Blockchain can serve as a single
shared ledger among interested parties, it can simplify the data model and management by reducing the
complexity of separate systems maintained by each entity.
• Faster Dealings - In the financial industry, especially in post-trade settlement functions, Blockchain can play
a vital role by allowing the quicker settlement of trades, as it does not require a lengthy process of
verification, reconciliation and clearance, as a single version of agreed upon data is already available on a
shared ledger between financial organizations.
• Cost Savings - As the Blockchain model does not require any third party or clearing houses, it can massively
eliminate overhead costs in the form of fees paid to clearing houses or to trusted third parties.

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3.4 BIG DATA: THE NEXT FRONTIER FOR INNOVATION,
COMPETITION, AND PRODUCTIVITY
The amount of data in our world has been exploding, and analyzing Big Data becomes a key basis of competition,
underpinning new waves of productivity growth, innovation and consumer surplus, according to research by MGI and
McKinsey's Business Technology Office. Leaders in every sector will have to grapple with the implications of Big Data,
beyond the few data-oriented managers that currently do so. The increasing volume and detail of information captured
by enterprises, the rise of multimedia, social media, and the Internet of Things (IoT) will fuel the exponential growth of
data in the near future.
Some examples of sources from which Big Data repositories are generated are as follows:
1. Medical Sensors and Equipment Data: Data generated from medical examinations and from continuous
recordings of indicators of the patient’s health condition (from multiple sensors and devices) generates vast
amounts of data per patient. This data is highly sensitive and private due to the awareness and legislation of
the patient’s privacy rights in most countries.
2. Black Box Data: Data generated by airplanes, jets and helicopters. Black box data includes flight crew voices,
microphone recordings, and aircraft performance information.
3. Social Media Data: Data developed by social media sites such as Twitter, Facebook, Instagram, Pinterest,
Google+ and more.
4. Stock Exchange Data: Financial data from stock exchanges, including prices at any time, share selling and
buying decisions made by customers.
5. Power Grid Data: Data from power grids that hold information on particular nodes, such as usage information.
6. Transport Data: Data includes capacity, vehicle model, location, availability and distance covered by a vehicle.
With the introduction of autonomous cars, research suggests that each autonomous car will collect and
generate more than 25GB of data per hour, including sensor data, inter-car transmissions, geographical data,
video and audio.
7. Search Engine Data: One of the largest sources of big data. Search engines have vast databases from which
they obtain their data

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4.0 MARKET ANALYSIS

4.1 CLOUD COMPUTING INNOVATION

In the IT industry, as well as in the cloud computing industry, technology is always developing and innovation comes
at a fast pace. The early adoption of cloud computing came from three distinct layers of services provided from the
IT industry: Infrastructure as a Service (IaaS), Platform as a Service (PaaS) and Software as a Service (SaaS). From
the IT perspective, several trends grouped into the four distinct layers, mentioned previously, focus on increasing the
efficiency of software distribution and hardware utilization have converged to enable the cloud computing model.
The cloud made storing and accessing data much easier than saving it to a USB flash drive or having to access a
remote physical computer.

4.2 MARKET SIZE

The market size of the cloud computing industry will continue to show robust growth if adoption tends to persist at
its current pace. Annual expenditures for worldwide consumption of applications that utilize cloud computing
reached nearly $70 billion USD in 2016. This figure represents roughly 250% growth in expenditures on cloud
computing from 2011. With the introduction of more powerful hardware and software that enable the logical
separation of the computing power into virtual machines, the cloud computing market will continue to grow. The only
hindrance to the continued growth of this market will be the availability of skilled professionals for organizations to
hire. Nonetheless, the limited talent pool that has the capabilities to implement and administer the complexities of
cloud based computing does not seem to affect the surveyed expectations of the expenditures of organizations on
cloud computing systems.

4.3 CLOUD COMPUTING TRENDS

Organizations are in need of a scalable architecture to support on-demand capacity and the ever-increasing
amounts of data. Thereby, organizations continuously investigate public cloud solutions to address these scalability
requirements. This also challenge that they address managing their databases and repositories. Public clouds allows
organizations to augment data center capacity and to take advantage of other value-added services. Organizations
that decide not to leverage the public cloud or take a "wait and see" approach may run into risks of being disrupted by
others in their industry. To illustrate the scale of these changes, Gartner expects that public cloud will reach a level of
maturity where organizations will embrace cloud computing and build strategies to leverage cloud services, thereby
predicting that by 2020 24% of the total addressable IT market will be based on cloud services.
Nearly one in five virtual machines (VMs) worldwide is in the public cloud, reflecting only the beginning of the growth
and the adoption of public cloud services among traditional enterprises. Though cloud computing is not the sole
technical innovation to focus upon, cloud services are the most pervasive and broadly impactful technical innovation
underpinning many other technical advancements, such as Big Data, Artificial Intelligence, Advanced Analytics and
IoT. Therefore, in today's environment a business strategy without a cloud strategy is risky and analogous to
deliberately ignoring the importance of a foundation to a building. Many organizations were using cloud services for
some time for SaaS initiatives. Today, organizations commonly engage in central IT to implement a better structure
for accelerating the adoption of cloud services. Consequently, many organizations move beyond initial deployments
and make investments that will enable cloud computing to be deployed in a repeatable and governed manner.
Organizations that leverage technology to deliver disruptive business models will succeed and may displace their
competitors. Organizations that avoid technical innovation will run the risk of being disrupted in their own core
businesses, potentially resulting in catastrophic outcomes for them. Figure below presents stages of companies
along this digital disruption curve.

15
4.4 CLOUD COMPUTING FORECASTS
As the adoption of cloud services grows among mid-tier and small and medium enterprises (SMEs),
leading researchers (including Forrester) are adjusting their forecasts of cloud computing usage upward.
Amazon’s latest quarterly results reveal that Amazon Web Services (AWS) attained 43% year-over-year
growth in revenues, contributing 10% of its consolidated revenues and 89% of its consolidated operating
income. Additional key takeaways from the roundup include the following:
• Gartner predicts that the worldwide market of public cloud services will grow 18% in 2017 to $246.8B,
up from $209.2B in 2016.
• 74% of the Tech Chief Financial Officers (CFOs) argue that cloud computing will have the greatest
impact on their business in 2017, as cloud platforms enable new and advanced business models, in
addition to substantial cost savings. Wikibon predicts that enterprise expenditure on cloud services
is growing at a 16% compound annual growth (CAGR) rate between 2016 and 2026.
• The research firm also predicts that by 2022 Amazon Web Services (AWS) will reach $43B in revenue,
representing 8.2% of all cloud expenditure.
• Since 2009, expenditure on cloud computing grows at 4.5 times the rate of IT expenditure and is
expected to grow at more than 6 times the rate of IT expenditure from 2015 to 2020. According to
IDC, worldwide expenditure on public cloud computing will increase from $67B in 2015 to $162B in
2020 attaining a 19% CAGR.

16
 The Rapid Growth of Cloud Computing, 2015-2020

Worldwide Spending on Public Cloud Computing,

2015-2020 ($B)
Average Compound Growth Rate, YE2015-YE2020, 19%
IT Spending Average Compound Growth Rate, $117
YE2015-YE2020, 3%
$99
$82
$67

2015 2016 2017 2018 2019 2020

Source: IDC 2016

17
Infrastructure-as-a-Service (IaaS) is projected to grow 36.8% in 2017 and reach $34.6B. Software-as-a-
Service (SaaS) is expected to increase 20.1%, reaching $46.3B in 20171.

Table 1. Worldwide Public Cloud

Services Forecast 2016 2017 2018 2019 2020
(Millions of Dollars)
Cloud Business Process Services
40,812 43,772 47,556 51,652 56,176
(BPaas)
Cloud Application Infrastructure
7,169 8,851 10,616 12,580 14,798
Services (Paas)

Cloud Application Services (Saas) 38,567 46,331 55,143 64,870 75,734

Cloud Management and Security

7,150 8,768 10,427 12,159 14,004
Services
Cloud System Infrastructure Services
25,290 34,603 45,559 57,897 71,552
(IaaS)

Cloud Advertising 90,275 104,516 118,520 133,566 151,091

Total Market 209,244 246,841 287,820 332,723 283,255
Source: Gartner (February 2017)

By the end of 2018, spending on IT-as-a-Service for data centers, software and services is expected to
reach $547B. Deloitte Global predicts that procurement of IT-as-a-service technologies will accelerate in
the next 2.5 years from $361B to $547B. At this pace, IT-as-a-Service will represent more than half of IT
expenditure by the 2021/2022 timeframe2.
The total expenditure on IT infrastructure products for deployment in cloud environments (server,
enterprise storage, and Ethernet switches) will increase by 15.3% year over year in 2017 to $41.7B. IDC
predicts that public cloud data centers will account for the majority of this expenditure (60.5%), while off-
premise private cloud environments will represent 14.9% of it. On-premises private clouds will account for
62.3% of the expenditure on private cloud IT infrastructure and will grow 13.1% from 20173 forward.

DELOITTE GLOBAL ESTIMATES FOR IT SPENDING MARKET

FOR DATA CENTERS, SOFTWARE AND IT SERVICES ($ BILLIONS)
2016 2018
100% = $1,406 billion 100% = $1,552 billion
(Gartner estimate) (Deloitte Global estimate)

$361bn $547bn

$1,045bn $1,005bn

IT-as-a-Service Traditional

1 Source: Gartner Says Worldwide Public Cloud Services Market to Grow 18 Percent in 2017.
2 Source: Deloitte Technology, Media and Telecommunications Predictions, 2017. 18
3 Source: https://www.forbes.com/sites/louiscolumbus/2017/04/29/roundup-of-cloud-computing-forecasts-2017/#3f4c764631e8
4.5 MARKET GROWTH RATE
Cloud computing matures in the IT industry domain, as many enterprise companies adopt it into their
infrastructure and business processes. Research of International Data Corporation (IDC) predicts that the
cloud computing industry will grow from a multimillion to a multibillion dollar industry. IDC reported that in
2013, the market growth rate in cloud computing had hit a $47.4 billion mark, predicting increase to $107.2
billion in 2017. In addition, Figure below presents the diffusion of cloud computing virtually to any sector and
use.

WORLDWIDE PUBLIC IT CLOUD SERVICES SPENDING

BY SEGMENT (IN $ BILLION)
120
$107.2

90 Infrastructure as a Service

60
$47.4
Software as a Service
30

Platform in Service
0
2013 2017

In which functional areas of your business are you using cloud-enable services today,
and which are you likely to adopt within the next 18 months?

Within Within Within Within

Now Now Now Now
18 months 18 months 18 months 18 months

Finance, Customer Sourcing and

HR accounting/ care procurement

57% 30% financial

management 41% 35% 51% 32% 36% 37%
Business Office tools/
IT intelligence/ productivity Tax

54% 32% analytics

41% 35% 36% 34% 36% 35%
Email / Operatings,
Security Supply chain
collaboration manufacturing
software management and logistics
53% 33% 40% 33% 35% 35% 35% 33%
Sales / Content
marketing management
51% 33% 39% 35%
Total respondents (n = 674)
Source: KPMG International's Global cloud survey: the implementation challenge

19
4.6 TOP PUBLIC CLOUDS USED

PLACE ENTERPRISE (1,000 + employees) SMB (under 1,000 employees)

#1 AWS AWS

#2 VMware vCHS Rackspace Public Cloud

#3 Azure Paas Google App Engine

#4 Azure Iaas VMware vCHS

#5 Rackspace Public Cloud Azure Paas

#6 Google App Engine Google Iaas

#7 SoftLayer / IBM Azure Iaas

#8 Google Iaas SoftLayer / IBM

#9 HP Cloud HP Cloud

4.7 TOP PRIVATE CLOUDS USED

PLACE ENTERPRISE (1,000 + employees) SMB (under 1,000 employees)

#1 VMware vSphere/vCenter AWS

#2 VMware vCloud Director OpenStack

#3 Microsoft System Center Microsoft System Center

#4 OpenStack VMware vCloud Director

#5 Citrix CloudStack Citrix CloudStack

#6 Eucalyptus Eucalyptus

According to Right Scale, there are four types of customers adopting the cloud: cloud watchers, cloud
beginners, cloud explorers and cloud focused. Cloud watchers are future customers who actively
incorporate the cloud into their strategic planning. These watchers scan the market for vendors and
providers to initiate a subscription or a service contract. Cloud beginners are users in the initial stages of
their cloud implementation. Cloud explorers already utilize the benefits of cloud services, including
platform, software or Infrastructure-as-a-Service. Cloud focused customers usually consist of smaller
companies and organizations with less than a thousand employees heavily invested in utilizing cloud utilities.
Although most enterprise customers fall into the categories of cloud beginners and cloud explorers, they
often employ more than one cloud solution. According to Right Scale, 75% of the enterprises use multi cloud
systems and half of the enterprises plan to use hybrid cloud systems. 96% of the enterprises are already
cloud customers, while only 4% of the enterprises have not yet incorporated the cloud into their strategic
plans.

20
4.8 GROWTH OPPORTUNITIES FOR CLOUD COMPUTING SEGMENTS
According to Sizing the Cloud report, Software-as-a-Service (SaaS) offers more growth opportunities than
any other segment in the largely vague market for cloud computing services. SaaS retains its position as a
leading segment in cloud computing with the SaaS market tripling its size, and reaching $92.8 billion in
2016. In contrast, Infrastructure-as-a-Service (IaaS) will witness a rapid growth in the next few years,
though Forrester expects dynamic infrastructure services to perform better than IaaS in the long term.

4.9 GLOBAL CLOUD COMPUTING SCORECARD

In recent years, cloud computing has emerged as an important trend in IT. As the world’s foremost
advocate for the software industry, the Business Software Alliance (BSA) is actively involved in addressing
the opportunities and challenges raised by cloud computing. Millions of consumers have embraced cloud
services that allow them to access applications and data from almost any location. A growing number of
businesses, particularly smaller companies, lease server capacity and use Internet-based applications to
perform key business functions. The first-of-its-kind BSA Global Cloud Computing Scorecard ranks 24
countries that account for 80 percent of the global ICT market based on seven policy categories that
measure how countries are prepared to support the growth of cloud computing, as listed in Figure below4.

8,8
7,9 6,6 6,5 6,5 6,2 6,9
8,4 9,3 6,5 3,2
6,0 6,4 7,6 7,6 3,6 6,4
7,6 8,0 8,1
6,0 6,4
10,0 9,4 10,0 8,8 9,0 5,6
10,0 9,6 6,8 4,8 6,8
8,8
8,8
6,2
17,2 17,6 16,8 16,6 17,6 17,2
16,4 17,4 17,4 15,2 10,8
16,8

8,8 10,0 9,8 9,4 9,6 9,6 8,8 10,0

9,2 9,8
9,8
9,8
9,2 7,0 9,2 8,0 6,8 7,0 8,6
8,8 9,4 9,6
8,8
8,4

20,9 21,3 20,2 21,7 19,5 21,5 21,7 21,8

17,2 17,8 18,9
14,9

Japan Australia Germany United States France Italy United Kingdom Korea Spain Singapore Poland Canada

4 Source: http://portal.bsa.org/cloudscorecard2012/ 21
4.10 BIG DATA
The economy produces a constant stream of data that is being monitored and analyzed. IDC
estimates that in 2011, the amount of information created and replicated surpassed 1.8ZB (1.6 trillion
gigabytes), which since then has quadrupled. Social interactions, mobile devices, facilities,
equipment, R&D, simulations, and physical infrastructure all contribute to the flow. IDC defines the
aggregate and high volume of data called Big Data - a new generation of technologies and
architectures designed to extract value economically from very large volumes of a wide variety of
data by enabling high-velocity capture, discovery and analysis.

4.11 BIG DATA: A NEW COMPETITIVE ADVANTAGE

The use of Big Data becomes crucial for companies that aspire to outperform their peers. In most
industries, established competitors and new entrants alike leverage data-driven strategies to
innovate, compete and capture value. For example, health outcomes of pharmaceuticals widely
prescribed are analyzed to discover benefits and risks that were not evident in the limited clinical
trials. Other adopters of Big Data use data from sensors embedded in products ranging anywhere
from children’s toys to industrial goods to determine how these products are actually used in the real
world. Such knowledge contributes to the creation of new service offerings and to the design of new
products.
Big Data contributes to new growth opportunities and entirely new categories of companies, such
as those that aggregate and analyze industry data. Many of these companies that are positioned in
the center of large data flows about products/services, buyers/suppliers, consumer preferences
and intentions can be captured and analyzed for profit5.

5 Source: https://iveybusinessjournal.com/publication/why-big-data-is-the-new-competitive-advantage/ 22
4.12 WHY IS BIG DATA ANALYTICS IMPORTANT?
Big data analytics helps organizations harness their data and use it to identify new
opportunities. That, in turn, leads to smarter business moves, more efficient operations, higher
profits and more satisfied customers. In the Big Data in Big Companies report, IIA Director of
Research Tom Davenport interviewed more than 50 businesses to understand how they use Big
Data. He found several ways in which they generate value from their data6:
• Cost reduction: Big Data technologies, such as Hadoop and cloud-based analytics, bring
significant cost advantages when it comes to storing large amounts of data and can
identify more efficient ways of managing businesses.
• Faster, better decision making: With the speed of Big Data analytics combined with the
ability to analyze new sources of data, businesses are able to analyze information
immediately and rapidly make calculated decisions based on the insights from the data.
• New products and services: With the ability to gauge customer needs and satisfaction
through analytics comes the power to give customers what they want. Big Data analytics
enables more companies to create new products that meet their customers’ needs.

4.13 BIG DATA TECHNOLOGIES AND SERVICES WORLDWIDE

WORLDWIDE BIG DATA TECHNOLOGY AND SERVICES REVENUE BY SEGMENT
2010 - 2015 ($M)
2010-2015
2010 2011 2012 2013 2014 2015
CAGR (%)
Servers 495.0 665.0 802.8 1,031.6 1,270.2 1,657.2 27.3
Storage 317.5 560.3 1,224.1 1,968.1 2,719.1 3,479.2 61.4
Networking 106.0 146.0 242.0 368.0 485.0 620.0 42.4
Software 1,062.3 1,415.4 1,851.0 2,476.8 3,367.9 4,625.9 34.2
Services 1,236.3 1,979.0 2,721.8 3,883.3 5,098.5 6,537.8 39.5
Total 3,217.1 4,765.7 6,841.7 9,727.8 12,940.7 16,920.0 39.4
Note: See Table 3 for top 3 assumptions and table 4 for key forecast assumptions.
Source: IDC, March 2012

IDC's estimate of the growth of the Big Data market through 2015 is presented in the following table.
The worldwide CAGR for the market through the five-year period is approx. 40%. However, the
growth of individual segments of the market varies from 27.3% for servers to 61.4% for storage. The
high CAGR for storage compared with other infrastructure components is attributable to the current
dual use of storage in Big Data environments. The most well-known use case is the use of low-cost,
high-capacity HDDs and DAS systems as a shared-nothing cache for servers in Hadoop grids (and
similar applications). This "brute force" use case is a major driver for the current demand for storage,
although future solutions may moderate the implementation of this approach. Additionally, growth
demand for storage systems functioning as archival storage systems that are installed to enable
sustained reanalysis of data for months or years.

6 Source: https://www.sas.com/en_us/insights/analytics/big-data-analytics.html 23
4.14 ARTIFICIAL INTELLIGENCE (AI)
Artificial Intelligence (AI) software performs complex tasks of identifying patterns and producing
insights from data. The business of AI, while quietly advancing in relative obscurity for decades, has
finally emerged into an entirely new industry with its own multi-billion dollar investments,
technologies and potential profits. It is projected that the value of M&A and Private Placement
transactions in AI over the next 5 years will exceed that of the previous 50 years, with several
acquisitions topping the $1 billion mark.

4.15 WHY HAS AI EMERGED AS A LARGE INDUSTRY NOW ?

Artificial intelligence is a technology that already impacts the ways in which users interact with
and are affected by the Internet. In the near future, the impact of AI is likely to substantially grow,
dominating more businesses and personal domains. AI has the potential to vastly change the way
that humans interact, not only with the digital world, but also with each other, through their work
and through other socioeconomic institutions.
AI refers to an artificial creation of human-like intelligence that can learn, reason, plan, perceive
or process natural language. These traits allow AI to bring immense opportunities in the medical,
industrial, educational and business fields, among others. To see why AI has entered into a new
era, we must present the enabling factors of AI:

• Technological Factors: As with many sudden disruptions, the emergence of AI is the product
of not just a single enabling factor that could be predicted with linear projections, but
combination of multiple enabling factors.

24
 • Inexpensive Parallel Processing: Traditional computer processors could only process
information linearly, but many aspects of human intelligence require parallel processing
capabilities. For example, in order to understand a word, each syllable has to be assessed in
relation to each syllable around it, and then each word within the context of a sentence. To see
an image, each pixel has to be seen in relation to the other pixels surrounding it, and only then
can the image be recognized. Serial computing cannot tackle these tasks with efficiency, but
the new capacities developed in AI require (and to an extent also enable) these operations. The
increasing diffusion of AI technologies virtually to every aspect of our lives demands high
volumes of inexpensive parallel computing. Initially, it was Gaming, rather than AI, that was the
initial catalyst for a consumer-level parallel computing capability. When the highly visual
demands of the video game industry proved too much for regular computer CPUs, this gave rise
to parallel processors like Nvidia’s Graphical Processing Unit (GPU), which currently process AI-
based computations.
• Big Data: The learning process of AI requires minimal volume of data that describes the past
occurrences of the attributes that it processes to identify patterns and reasoning and to
predict the future “behavior” of it under different conditions. AI learns through an iterative
process and thousands or millions of past data examples (e.g. photos, music, texts, videos or
database records) have to be processed to complete a particular task. The level of data
available for an AI program to access has significant impact on the speed and quality of learning
and on ultimate competence that it can attain. For example, Google has been delivering more
precise results in searches, both of websites and photos, due to the unprecedented volumes of
data available to Google’s AI algorithms collected in the company’s databases.
• Market Factors: AI suffers from a peculiar form of treatment from the media, where any
advancement in AI is often not recognized as such. For the last three decades, whenever a form
of AI became a successful product in the market, it was often reclassified into a new industry of
its own, and hence no longer considered a part of the AI complex. Search engines, speech
recognition, voice recognition, autonomous vehicles, industrial robotics and high-frequency
trading are examples of this notion. When the mainstream believed that AI was a fad that had
vanished, in reality AI was already everywhere.

4.16 ARTIFICIAL INTELLIGENCE INDUSTRY SIZE

The rapid growth of the AI sector is the result of a perfect storm of factors: supply of parallel
processing power via data centers, vast creation of big data and competitive needs of businesses
across multiple sectors that recognize the need for AI to augment their productivity. This
combination of factors is expected to generate a virtuous cycle of advances in AI over the next
decade, with even the more conservative estimates of growth are as high at 50% per year from 2017
to 2025. Additionally, as sensors are embedded virtually in every sector (including industry,
medicine, transportation, security and more) as the IoT that collects and stores data, these trends
are expected to intensify.

25
 ARTIFICIAL INTELLIGENCE REVENUE WW ($BILLIONS)
$45
50,0
$40
$35
37,5
$30 High
$25
25,0
$20
$15 Low
12,5
$10
$5
$0
0,0
2017 2018 2019 2020 2021 2022 2023 2024 2025

It is noteworthy that each industry listed here previously had little in common with most of the other
industries in the chart. This is the essence of AI as innovation that disrupts many industries at once,
hence M&A activities in AI will present a number of novel buyer-seller match-ups. The projected AI
revenues by industry vertical are estimated as follows:

AI PROJECTED REVENUE AI PROJECTED REVENUE

DISTRIBUTION SHARE
BY VERTICAL, 2017-25 BY TECHNOLOGY
Other

Medical 
 ASI Deep
20% 1%
Diagnostics

AGI Learning
Cybersecurity
 21% 42%
6% 10%
Search
 Machine Vision
Law
 21%
7% 10%
Machine
Autonomous 
 Sales and 
 NPL Learning
Vehicles
 Marketing
 7% 21%
7% 18%

4.17 OTHER HARDWARE AND SERVICES REVENUE BOOSTED BY AI

Since neural networks and other forms of computation were bottlenecked by the slow rate of
processing available through ordinary CPUs, the arrival and price declines of parallel processors,
such as Nvidia’s GPU, sped up the processing of neural networks by 20-50 times. At present,
Nvidia and ATI controls almost 100% of this market. Nvidia’s stock price has risen over 10x in just
two years due to the extremely high demand for its GPUs. In addition to GPUs, other forms of
hardware, such as servers, datacenter hardware, networking equipment, and storage will also be
boosted by the wide spread of AI. The revenue generated from these associated hardware sales
is projected to rise from $3 Billion in 2016 to over $35 Billion by 2025. Companies benefitting from
this momentum include Google, Cisco Systems, Intel, Nvidia, IBM and EMC, among others.

26
 AI-DRIVEN PROJECTED HARDWARE SALES BY TYPE
($ BILLIONS, WW)
$40
40,0
$35
$30
30,0 Networking
$25
$20
20,0 Storage
$15
Datacenters
$10
10,0
$5 GPU's
0,0$0
2017 2018 2019 2020 2021 2022 2023 2024 2025

4.18 SUPPORT FOR AI FROM GOVERNMENTS

Leading digital economies are acting to grow their national AI capabilities and subsequent market
shares.
• UK: It’s possible that the UK will need to raise its level of investment to match the support of
other global competitors for their AI sectors.
• France: Launched an AI strategy in March 2017. The government’s recommendations include:
Establishing a strategic committee for AI; establishing a program for identifying, attracting and
retaining AI talents; funding a mutualized research infrastructure; a public-private consortium to
identify or create an AI center; ensuring that AI is a priority for all innovations in public bodies;
investing €25 million in ten AI startups within five years.
• Singapore: The National Research Foundation (NRF) is investing up to S$150 million into a new
national program aimed at boosting Singapore’s AI capabilities over the next five years.
• United States: The government invested US$1.1 billion in unclassified R&D for AI systems in 2015
and an estimated US$1.2 billion in 2016. The Information and Intelligence Systems Department of
the National Science Foundation and the programs related to AI from the DARPA are reported to
have been around US$300m-$400m a year for the last 15 years. The 2016 White House reports
include strategic planning for National Artificial Intelligence Research and Development.
• South Korea: The government announced that it will invest 1 trillion KRW in AI research over the
next five years, a 55% increase in annual funding for AI.
• Germany: The Research Center for AI (DFKI) was founded in 1988 and has an annual budget of
€41m. It is one of the world’s largest AI labs, with nearly 500 researchers.
• Canada: A Pan-Canadian AI Strategy funds research and talent acquisition. The funding is worth
C$175m and aims at attracting and retaining top academic talents in Canada.
• China: China’s ambition is to create a US$15 billion AI market by 2018 and its government
prepares a comprehensive AI strategy for this purpose.

27
 AI – VALUE OF VC FUNDRAISINGS AMONG INTERNATIONAL COMPETITORS,
2010 - 2016
Country 2010 2011 2012 2013 2014 2015 2016 Total

United
£112m £171m £228m £399m £843m £1,503m £1,578m £4,833m
States

China £6m - £1m £15m £55m £124m £199m £401m

United
£6m £9m £24m £18m £19m £67m £152m £294m
Kingdom

Canada £3m £17m £11m £4m £2m £23m £11m £71m

Germany £3m £8m £8m £0m £0m £7m £9m £36m

France £3m £1m - £1m £1m £9m £15m £31m

Total £132m £206m £272m £438m £920m £1,733m £1,964m £5,666m

4.19 AI: THE NEXT DIGITAL FRONTIER?

Artificial intelligence is poised to unleash the next wave of digital disruption, and increasing numbers
of companies are preparing for it, experimenting with AI, studying and implementing it. The real-life
benefits that are evident for a few early adopting firms make the acceleration of digital
transformation via AI more urgent than ever for other companies and organizations. Robotics and
autonomous vehicles, computer vision, language, virtual agents and machine learning, which
includes deep learning and underpins many recent advances in the other AI technologies, are among
the technologies that companies need to implement in their business operations. With more
companies understanding these trends and the urgency of AI adoption as means for their long term
survival, AI investment is growing fast and it is dominated by digital giants, such as Google and Baidu.
Globally, we estimate the expenditure of large technological companies on AI in 2016 between $20
billion to $30 billion, with 90 percent of this spent on R&D and deployment and 10 percent on AI
acquisitions. VC and PE financing, grants and seed investments also grew rapidly, albeit from a small
base, to a combined total of $6 billion to $9 billion per year. Machine learning, as an enabling
technology, received the largest share of both internal and external investments. AI adoption outside
of the IT industry is at an early, often experimental stage. Few firms have deployed it at scale. In a
survey of 3,000 AI-aware C-level executives across 10 countries and 14 sectors, only 20% said that
they currently use any AI related technology at scale or in a core part of their businesses. Many firms
say that they are uncertain of the business case or the return on investment. A review of more than
160 use cases show that AI was commercially deployed in only 12 percent of the cases. Adoption
patterns illustrate a growing gap between digitized early AI adopters and others. AI promises
benefits, but also poses urgent challenges that cut across firms, developers, government and
workers. The workforce must be reskilled to exploit AI, rather than compete with it. Cities and
countries serious about establishing themselves as a global hub for AI development, need to join the
global competition to attract AI talents and investments, and progress must be made on the ethical,
legal and regulatory challenges that could otherwise hold back AI.

28
4.20 BLOCKCHAIN TECHNOLOGY ADOPTION & GROWTH
Blockchain technology is emerging as a business focus for many companies in many industries.
Consumer products, manufacturing, technology, banks, media and telecommunications are the
sectors most likely to already have Blockchain projects in production, while healthcare and life
sciences lead all sectors in plans to deploy Blockchain projects this year. According to a survey by
Deloitte, a new IBM study found that one-third of C-level executives are using or considering
adopting Blockchain technology in their organizations. The study found that executives hope to
enable new transaction applications that could help establish trust, accountability and
transparency among their organizations and trade partners.
80% of 3,000 executives surveyed indicated that they were using or considering using the
technology either to develop new business models or in response to a financial shift in the industry.
Additionally, 71% of the business leaders who actively use Blockchain believe that it plays a key role
in advancing the technology, suggesting widespread support for industry standards. The
Blockchain is a disruptive technology that promises to change the world as we know it. The
technology does not only alter the ways of using the Internet, but also revolutionizes the global
economy. By enabling the digitization of assets, Blockchain fosters a fundamental shift from the
Internet of information, where we can instantly view, exchange and communicate information to
the Internet of value, where we can instantly exchange assets. It disrupts hundreds of industries
that rely on intermediaries, including banking, finance, real estate, insurance, legal, healthcare and
many others. Some of the facts regarding adoption of the Blockchain technology are as follows:

1. Bitcoin, a money exchange system, 7. The global Blockchain market is expected to

pioneering the Blockchain technology has be worth $20 billion by 2024.
grown by more than 100% per year since its 8. 90% of major North American and European
introduction in 2010, though the identity of banks are exploring Blockchain solutions.
the person or the team behind the service, 9. Blockchains are highly transparent, as
known by the pseudonym Satoshi Nakamoto, anyone with access to a Blockchain can view
is cloaked in secrecy. the entire chain.
2. Blockchains can be public (like the Internet) 10. Similar to a Google Doc, all the participants
or private (like an Intranet). within a network see all the changes in the
3. In terms of its development, Blockchain is ledger. The ledger is constantly updated and
where the internet was 20 years ago. each participant its own copy copy of it.
4. Only 0.5% of the world’s population use 11. 9 out of 10 bankers agree that Blockchain will
Blockchain, but 50% or 3.77 billion people disrupt the banking and financial industry. It
use the Internet. is estimated that banks could save $8-12
5. There are significant investments by billion annually if they used the Blockchain
technology giants, such as IBM and technology.
Microsoft, in Blockchain technologies. IBM 12. One-third of C-level executives are
dedicates $200 million and 1,000 employees considering adopting the Blockchain
to Blockchain-powered projects. The technology or use it by now.
average investment in Blockchain projects is 13. Just like with the Internet, there will be jobs
$1 million. that will become obsolete due to the
6. Over the last five years, VCs have invested adoption of the Blockchain technology.
more than $1 billion into Blockchain However, new professions that we never
companies. dreamt about will be created as a result of
the Blockchain transformation.

29
4.21 BLOCKCHAIN TECHNOLOGY TRENDS
According to Gartner, by February 2017, Blockchain was the second top search word on its website, a
400% increase in just a year. This is no surprise as the technology is gaining significance with 20% of
the global trade finance expected to use it by 2020. The financial sector will lead the way in the use of
that -Blockchain technology that later will be applied in other areas, including:
• Public administration
• Supply chain management
• Tracking of digital rights in music and movies
• Smart contracts
• Recording of patient health data
In 2018, investments in Blockchain technology will continue to grow as has been the trend since 2016,
when a total of $1.1 billion of venture capital was invested in the sector. The continued investment is
informed by the potential of the technology to transform the way business is conducted. However,
most investment today is in the financial services sector, which is perfectly understandable as there is
a close association of Blockchain with cryptocurrency.
Deloitte predicts that Blockchain may soon overtake other technologies, such as cloud computing,
data analysis and the Internet of Things in venture capital investments. However, it may take long
before attaining the level of the hype that surrounded the Internet in the late 1990s.
Scalability has been a major setback for the application of the technology. Traceability, a key feature of
Blockchain can only be achieved by storing full details of every stage of a transaction. This increases
the size of blocks and consequently the time required to validate a transaction. The number of storage
nodes also increases, making synchronization more difficult with the result that a transaction takes
longer to be confirmed in the Blockchain network. While fast paced industries, such as financial
services, need to process thousands of transactions every second, Blockchain can only validate and
record 7 transactions per second. Fortunately, Blockchain networks like Bitcoin and Ethereum are
developing capabilities for multiplying transaction volumes to about 45,000 per second

4.22 TYPES OF BLOCKCHAIN NETWORKS

Presently, there are four ways to establish a Blockchain network, with a consortium being the most
accepted model for business.

1. Consortium Blockchains
In a consortium Blockchain, the consensus process is controlled by a pre-selected group - for
example, a group of corporations. The right to read the Blockchain and to submit transactions
to it may be public or restricted to participants. Consortium Blockchains are considered to be
“permissioned Blockchains” and are best suited for use in business.

30
2. Semi-Private Blockchains
Semi-private Blockchains are run by a single company that grants access to any user who
satisfies pre-established criteria. Although not truly decentralized, this type of permissioned
Blockchain is appealing to business-to-business use cases and to government applications.

3. Private Blockchains
Private Blockchains are controlled by a single organization that determines who can read it,
submit transactions to it and participate in the consensus process.

4. Public Blockchains
Anyone can read data on a public Blockchain, send transactions to it or participate in the
consensus process. They are considered to be “permissionless.” Every transaction is public,
and its users can remain anonymous. Bitcoin and Ethereum are prominent examples of public
Blockchains7.

7 Source: https://www.sap.com/products/leonardo/blockchain.html# 31
5.0 THE COMPETITIVE LANDSCAPE
The size of the cloud services market providing both storage capacities and computational
processing capabilities to companies and to corporates is estimated to be 45 billion USD per annum
and it steadily grows. The market is dominated by four major players: AWS, Google Cloud, Microsoft
and IBM - all utilize central and less trusted storage and computation facilities. Due to their
oligopolistic dominance, the four providers of cloud services set high pricing levels. These
providers are also capable of hampering any competition and preventing new market entrants from
competing with them, due to the broad scale of their operations and their substantial investments
in data centers, servers and storage facilities.

5.1 THE INDUSTRY LEADERS

The cloud computing industry ranges back to the 1990s. It is dramatically growing throughout the past
decade. Although the cloud computing industry is not small, many of its competitors are small to
midsize companies. There are nearly 200 recognized cloud computing providers given that include
large companies like Amazon, Red Hat, IBM, Oracle and Microsoft that have a fraction of their
organization broken down into multiple divisions offering different cloud computing platforms.
Microsoft has three major divisions in cloud computing, including Microsoft Azure, Azure Web Services
and Microsoft 365. Other companies, such as Cloud.bg, Cloud Sigma and GoGrid largely focus on cloud
computing but make up a smaller percentage of the market by revenue.
Amazon, mainly known for its online shopping platform, has its own cloud computing division - Amazon
Web Services (AWS). AWS was ranked as a 2014 top leader in Infrastructure-as-a-Service by the
Computer Business Review. The division started in 2006 and made a profit of $99 million by the end of
its first year. In 2013 the company’s revenues exceeded $1.69 billion and over $2.5 billion by the end of
2014. Red Hat is another major provider in open sources cloud computing solutions and a top Platform-
as-a-Service provider. During its 2014, Red Hat generated revenues of over $1.53. The major software
provider Microsoft has generated $156 million over 2014 through its public cloud IaaS or Infrastructure
as a Service. Microsoft is also considered as one of the top IaaS provider for 2014 and is a major
competitor against Amazon Web Services. In 2014, Google, a company that earns a majority of its $40+
billion in revenues through advertising, generated $66 million from its cloud services. Google was
recognized a top cloud storage provider in 2014. Oracle reports that its cloud revenue has increased by
30% in their first fiscal 2015 quarter. It generated $475 million in revenues from its Software-as-a-
service and Infrastructure-as-a-service offerings.
The growth of software development, infrastructure, security and storage solutions contributes to the
demand for cloud-based storage, security and data processing solutions. According to Forbes, Gartner
estimated that by 2016 nearly 50% of the world’s largest enterprises invested in cloud computing
solutions, making it the bulk of worldwide IT expenditure. It also estimated that companies worldwide
spent over $3 billion on cloud based security service solutions alone. That is $1 billion more than what
companies spent in 2013 for similar cloud based solutions. As the cloud computing industry continues
to thrive off companies investments and expand, opportunities for growth and new entries will
continue. In the past five years, companies as Boundary, Couchbase, Cloudkick, Dotcloud, Fluid Info,
Open Stack and Tidemark joined the market and since then continue expanding.

32
5.2 THE SCOPE OF COMPETITIVE RIVALRY

The cloud computing industry is varied and nuanced with each competitor offering niche services.
Depending on what the consumer trend will be over the long run, many of these offerings will
probably be phased out. Google, Microsoft, Red Hat and SalesForce are the predominant
organizations that offer cloud based enterprise solutions.
1. Amazon Web Services (AWS)
In 2006, Amazon Web Services (AWS) began offering IT infrastructure services to businesses in
the form of web services, now commonly known as cloud computing. One of the key benefits of
cloud computing is the opportunity to replace up-front capital infrastructure expenses with low
variable costs that scale with your business. With the Cloud, businesses no longer need to plan for
and procure servers and other IT infrastructure weeks or months in advance. Instead, they can
instantly spin up hundreds or thousands of servers in minutes and deliver results faster. Today,
Amazon Web Services provides a highly reliable, scalable, low-cost infrastructure platform in the
cloud that powers hundreds of thousands of businesses in 190 countries around the world. AWS
offers low, pay-as-you-go pricing with no up-front expenses or long-term commitments. AWS
provides a massive global cloud infrastructure that allows you to quickly innovate, experiment and
iterate. Instead of waiting weeks or months for hardware, you can instantly deploy new
applications, instantly scale up as your workload grows, and instantly scale down based on
demand. Whether you need one virtual server or thousands, whether you need them for a few
hours or 24/7, you still only pay for what you use. AWS is a language and operating system agnostic
platform. You choose the development platform or programming model that makes the most
sense for your business. You can choose which services you use, one or several, and choose how
you use them. This flexibility allows you to focus on innovation, not infrastructure8.
2. Google Cloud
Google will continue to be the most utilized search engine and search analytics provider in the
world. With the adoption of niche services and platforms Google can capture a slice of the growing
cloud computing market. Google's large installed base (it claims 30,000 paying customers)
consists of many small Web innovators and some very large Web business sites. The vendor also
claims that over 90% of its internal IT runs on App Engine. The practice of the internal use of App
Engine, as well as the App Engine experience of supporting the high number of isolated tenants,
sets the stage for Google's enterprise campaign. Google's outstanding reputation as a cloud
services provider and an early big data innovator lends credibility to Google App Engine.
Google Cloud Storage is a flexible, scalable, and durable storage option for virtual machine
instances. Users can write files to Cloud Storage buckets from almost anywhere, can use buckets
as common storage between instances, Google App Engine, on-premises systems, and other
cloud services. If Cloud Storage buckets do not meet performance and latency requirements, user
can use Cloud Storage in combination with other instance storage options.

8 Source: https://aws.amazon.com/about-aws/ 33
3.  Microsoft Azure
Microsoft has dominated the private and public sectors’ productivity software. The introduction of
Azure demonstrates Microsoft’s focus on the future of cloud computing. Microsoft's offering,
Windows Azure, has evolved into an environment that supports IaaS and PaaS models. The vendor's
approach is to focus on a "cloud first" push toward frequent updates and an aggressive approach to
features and enhancements. Its long-term goal is to deliver the full range of .NET application
infrastructure capabilities as Azure services. Its capabilities include its SQL Database as well as
messaging middleware services (Windows Azure Service Bus), in-memory data grid services
(Windows Azure Cache) and Windows Azure BizTalk Services. It has also recently added Windows
Azure Mobile Services, a cloud mobile back-end service offering that supports multiple clients
beyond its own mobile client strategy. Its presence in other cloud environments (for example, SaaS
through Dynamics CRM Online and Office 365, including SharePoint Online) also contributes to the
vendor's broad cloud strategy.
4.  IBM Cloud
When it comes to public cloud computing vendors, IBM doesn't always enjoy the same mindshare as
Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform. However, some analyst
reports have claimed that IBM actually has a larger share of the infrastructure as a service (IaaS)
and platform as a service (PaaS) market than Google. Other analyses place it solidly in fourth place
behind the "big three." Either way, IBM is one of the largest cloud computing providers on the
planet. Telling the story of IBM's public cloud computing capabilities is complicated by the fact that
IBM uses a lot of different brand names for its cloud services. The "IBM Cloud" label is an umbrella
category that encompasses its hardware, software and services for helping enterprises build
private clouds, as well as its Bluemix public cloud services. The "Bluemix" name used to be reserved
for IBM's PaaS services for developers, but now Bluemix also offers some IaaS services. In addition,
IBM has another IaaS service called SoftLayer. Organizations can still purchase cloud computing
services under the SoftLayer brand name, but IBM seems to be migrating toward the Bluemix
brand.
5.  Red Hat
Red Hats collaboration with the open source community gives the organization an advantage to the
newest innovation. Finding practical applications and monetizing these innovations is a difficult
task. Red Hat is a leading provider of the open-source Linux OS technology and the open-source
JBoss family of middleware products. The vendor has utilized these to enter the market with its
high-control, cloud-based, shared-OS OpenShift Online offering, and also offers an on-premises
CEAP called OpenShift Enterprise, which can be used by IT organizations to create a private
Platform as a service (PaaS) environment.
6.  Salesforce.Com
Salesforce continues to make strong gains in the software as a service (SaaS) and the platform as a
service (PaaS) markets. Salesforce.com has been a pioneer in the cloud computing industry
offering a market-leading SaaS since 1999 and a market-leading PaaS since 2007. Force.com, a
cloud-native, high-productivity, shared-everything cloud platform service remains their star cloud
computing platform.
The scope of competition in the cloud computing market is vast and each organization has their
own proprietary offering to sway consumers. What consumers will inevitably settle on is a cloud
computing service that affords the purchaser data security while delivering performance

8 Source: https://aws.amazon.com/about-aws/ 34
5.3 CUSTOMERS
Thanks to the large amount of cloud service provider companies of any size can deploy a scalable
cloud solution. According to Forbes, Oracle alone has over ten thousand customers with twenty-
five million users. To scale the customer base, Oracle has over ten thousand customers, yet it does
not fall on Right Scale’s Top Ten List of Public Clouds Used. AWS is the top public cloud provider for
both enterprises and small businesses and has nearly 200,000 customers in 190 countries world-
wide. Some of Amazon’s largest customers include HTC, Expedia, Pinterest, Comcast, the Food and
Drug Administration and even the National Aeronautics and Space Administration. VMware has
over 500,000 customers including the Fortune 100 companies making VMware’s vSprere/vCenter
the top private cloud used for both enterprises and small businesses. Other top private cloud
providers including: Red Hat, Microsoft and Citrix have thousands of customers worldwide.

5.4 EASE OF ENTRY:EXIT

The ease of entry and exit in the cloud computing industry is based off the entry into the IT
industry. Cloud computing is still being improved by many IT companies to condense processes
as appose to pre-cloud computing. In addition, it is difficult for one to enter. The difficulty of
entry into the industry is due to major companies, such as Red Hat, Google, Amazon, and
especially Microsoft, being around for quite some time as well as being the major technology
innovators in the IT industry; along with that, it possess many barriers for one to enter into the
IT/cloud computing industry. One must have a strategic business analysis, investment
requirements, patents, knowledge assets, etc., and the competitive edge to compete with other
IT companies. It is hard for one to enter the industry. Some start by building a small IT base
company to build software/web applications through the technologies being introduced such as
the cloud. Others are created as integration services providing support for integrating other
companies’ platform onto another platform such as the cloud for better processes and work
flow. This allows most start-ups to ease into the IT/cloud computing industry. It makes it much
easier to gain private investment and build up the company’s portfolio by doing so. However, this
takes away the expansion of the cloud computing industry as many small companies are
offering or providing better support for integration, software products and, rarely, resources.

35
5.5 COMPETITIVE EDGES
All the competitors of IAGON (besides Sonm) base their operations and offerings on centralized
storage and processing. IAGON, however, is going to revolutionize the cloud and web services
market by offering storage and processing services that are based on a decentralized grid. By
joining the unused storage capacity of servers and personal smart devices and their processing
power, IAGON will create a super-computer and a super data center that can generate massive
volumes of storage and processing power and will compete with any of the current cloud
computing companies. IAGON has the following competitive edges over its competitors:

• IAGON revolutionizes the cloud industry by providing a fully secure and decentralized cloud
storage and processing platform based on Blockchain technology.
• IAGON is a platform for harnessing the storage capacities and processing power of multiple
smart devices over a decentralized Blockchain/Tangle grid.
• IAGON enables to store big data files and repositories, as well as smaller scales of files, and to
carry out complex computational processes, such as those needed for AI and machine
learning operations, within a fully secure and encrypted platform that integrates Blockchain
cryptographic and AI technologies in a user-friendly way.
• IAGON is powered by Artificial Intelligence to connect users to services and decentralized
applications.
• IAGON has easy to use features and functionalities synced across all smart platforms for all
types of users – from individuals to full blown enterprises.
• Under IAGON’s platform, one can imagine a world where anyone can profit by joining its
massive processing and storage grids.
• IAGON will launch a crypto-token system that enables users of the storage and processing
grids to pay for services that they consume, while those who contribute their resources to the
grids benefit from these tokens.
• IAGON tokens can be traded and converted to fiat money via cryptocurrency exchanges.
• IAGON provides 24/7 operation of the storage grid, processing grid and the Blockchain.
• IAGON provides users with a friendly platform.
• Trusted, integrated decentralized applications on a single platform for every type of user,
from Fortune 500 companies to SMEs.
• Users can create their own smart contracts on a simple to use interface, without writing any
line of code.
• Miners generate revenue on IAGON’s platform by sharing their smart device or servers free
resources of storage and computing power.
• Integrated cryptocurrency wallets help manage transactions across different decentralized
applications.
• The storage and the processing are fully protected by encryption on the Blockchain and
therefore they are 100% secure and resistant to hacking.

36
6.0 SWOT ANALYSIS
Cloud computing promises significant opportunities for growth, if inimitable services are provided
at low costs. The market research and analysis reveals that there is tremendous growth potential in
the market and IAGON will penetrate it at a fast pace. The market and business analysis shows that
this business is secure and presents profitable investment opportunities. To determine a strategic
planning that would best benefit to the IAGON, the SWOT analysis presents the various aspects of
the business. More importantly, this analysis serves as the groundwork to back up and steer the
marketing efforts valuable to the business.

INTERNAL
STRENGTHS WEAKNESSES

Presently, there are no direct competitors of IAGON is new in the market, while many cloud
IAGON, as they are offering centralized computing companies are already there - especially
storage and processing, whereas IAGON the four big companies i.e. Amazon Web Services
is going to offer decentralized storage and (AWS), Google Cloud, Microsoft Azure, IBM Cloud. It
processing. will take time to penetrate in the market and to
─ realize the customers that IAGON offers unique
IAGON will create a super computer by joining services that are different from its competitors.
unused storage capacity in servers and personal ─
smart devices and their processing power. Heavier marketing and advertising expenditures
─ and efforts are required to create awareness.
IAGON is going to revolutionize the cloud industry
through fully secure and decentralized cloud
storage and processing platform based
on Blockchain/tangle technology.
─
IAGON will store big data files and repositories,
smaller scales of files and will carry out complex
computational operations.
─
IAGON will provide a fully secure and encrypted
platform using the Blockchain’s cryptographic
power, Artificial Intelligence technologies, and will
eventually implement the innovative Tangle
technology.

37
 EXTERNAL
OPPORTUNITIES THREATS
Cloud Computing is the most prominent technical The market is already moving towards intense
innovation in IT and it will continue to grow in competition of cloud service providers, and new
demand and in capabilities in the coming years. entrants can easily join it. The existing large
Cloud Computing is an innovative technology companies, i.e. Amazon Web Services (AWS),
growing at fast pace. Google Cloud, Microsoft Azure and IBM Cloud, may
─ also offer services similar to IAGON’s at lower
Organizations increasingly demand public clouds prices. If this situation prevails, it may lead
to address their scalability requirements. to stiff competition.
This trend creates tremendous growth ─
opportunities for companies like IAGON. The number of cloud computing, Big Data and
─ Blockchain companies’ increases with a fast pace
It is predicted that 24% of the total IT market all over the world. This increasing trend may
will be cloud based by 2020 decrease IAGON’s market share.
as it increases at 19% CAGR.  
─
The use of Big Data becomes crucial for leading
companies to outperform their peers and creates
new growth opportunities for data storage and
processing companies.
─
In the next 5 years AI will exceed its development
in the past 50 years with many opportunities
emerging in this field.
─
AI is being considered the next digital frontier.
─
The Blockchain technology emerges as a business
focus for many companies in multiple industries
and creates marvelous growth opportunities for
companies associated with the Blockchain
technology.

38
7.0 MARKETING STRATEGY
IAGON’s marketing combines the latest international advertising technologies to effectively promote its
operations. The company will rely on the Internet for most of its marketing needs. The aim of IAGON’s
marketing is to generate the highest levels of revenues from its network and to strengthen customer loyalty.
One of the key responsibilities of the marketing team will be lead generation. The methods used for lead
generation include: advertising in trade journals, IT events and conferences, telemarketing, user groups,
direct mailing, targeted sales calls and customer referrals. The basic marketing activities carried out to sell
the services of IAGON are listed as follows:
• Marketing will be done mainly through the creative leadership of the CEO and Operational Director.
• Effective and timely Customer Support is one of the best marketing tolls. The management team will go
a long way toward providing a timely professional response to calls, emails and online queries.
• IAGON also intends to work closely with marketing professionals to ensure that it is on the cutting edge
of the advertising technology.
• Cloud Computing, Big Data, Blockchain/Tangle and Artificial Intelligence are very potential markets and
can be tapped with the right team of marketing personnel. The risk is only associated with available
resources. Our strategy is to have maximum output from highly paid, highly focused, minimal
resources.

7.1 MARKETING TARGET

• The target of IAGON’s marketing are the users that consist of corporates, public institutes and SMEs
that require large secure storage and processing capacities, including cloud services, database
storage, historical data archiving, data analytics, batch processing, etc.
• The other target of IAGON’s marketing are the miners that consist of data centers that do not fully
utilize their storage and server capacities and can dedicate portions of them to IAGON’s grids.

7.2 CONTENT MARKETING

IAGON will effectively use online content tools for marketing, as its marketing team will launch integrated
campaigns that not only increase engagement and generate revenue but that also leverage the products and
the services that IAGON provides. The company will use message maps and one-page documents that will
illustrate the most important emphasis on each given aspect of its services. The company will set the main
points to support any online channel, from blog posts to videos. In addition to its main message map, IAGON
will create a map before starting most of its content generation and distribution. Since these maps will
reinforce the company’s core message, they are conceptual offshoots of the main visionary map that was
created by its executives.
• We will distribute digital and printed IAGON profile and leaflets to large companies and digital leaflets to
SMEs to help them understand how cost effective and profitable IAGON’s platform is. We will also
provide a comparison on how IAGON’s platform is better than its competitors.
• We will target every type of user from fortune 500 companies, SMEs, to daily users and help them
realize how IAGON can cut their costs through provision of a fully secure and encrypted platform using
Blockchain cryptographic (eventually Tangle Technology as well) and Artificial Intelligence
technologies.
• IAGON will lead the market by offering a revolutionized cloud computing market and fix the data
security issues of its customers.
• IAGON will use user experience and design at the forefront of the customer-driven marketing
campaign.

39
7.3 PRINT AND ELECTRONIC MEDIA MARKETING
The most effective marketing channels are Internet-based. Hence, the marketing costs of advertising the
company and its services will be relatively low compared to more traditional local and print media
campaigns. However, we will not ignore print media marketing at all. The following include the breakdown of
the company’s print media marketing strategy:
• Newspapers and Magazines Campaign – IAGON plans to generate awareness through print media
campaigns that are based on PR and media coverage. These campaigns can deliver the essence of the
company plans and the benefits to potential customers.
• Posters/brochures – Posters might be placed to the Chamber of Commerce, SME sector Associations,
and other business hubs in the local market. The printed brochures and leaflets will be distributed
throughout the target markets in conferences and trade shows.
• TV Ads – IAGON will use ads on all major TV channels locally and nationwide.
• Free Basic Study Material – The Company will provide basic study material free of cost to create
awareness in the public about the services offered.

7.4 INTERNET MARKETING STRATEGY

Since studies have proved that the most effective marketing channels to market the cloud computing
business is Internet, we will focus on online advertising channels. The following is a breakdown of the
company’s Internet marketing strategy.
• Website Development – The website of IAGON exists and will further be developed in the first step of
the Internet marketing campaign. The website will be updated regularly and provide information
regarding the benefits of decentralized cloud computing services and their adoption. Additionally, the
online user platform will further be expanded to include online support and interactive Q&A.
• Search Engine Optimization (SEO) – IAGON will hire a part time SEO specialist to work on improving the
visibility of the website on all major search engines, primarily on Google.
• Marketing Communications (MARCOM) – Major efforts in addition to SEO and development of new
website features and contents will be dedicated to marketing communications that include blog posts
and promotion via independent professional bloggers, development of a Youtube channel, posts in
social networks in IAGON’s business page and in related groups (Facebook, Linkedin, Pinterest,
Google+, Twitter, Medium and Reddit) and in online mainstream and professional news sites.
• Paid Advertisement (Google AdSense, Facebook, etc.) – Organic SEO takes longer time to show results.
It could take from 3 months to as long as 6 months to promote to promote a website to Google’s first
search results. Therefore, along with traditional search engine techniques, the company will use paid
advertisement to rapidly gain a broad customer base. Paid advertisement on Google and Facebook will
link to the company’s website on all major search results and Facebook pages.
• YouTube Commercials – Another important channel to market the website effectively to a selected
range of target audience is through YouTube commercials. The company will place properties promo
videos on YouTube in a cost-effective and customer focused manner.
• Professional Networking – IAGON would build a professional network of industry experts mainly through
online efforts, such as Linkedin.
• Blog – A dedicated blog to educate website visitors about the important information and latest
happening in the area about cloud computing will be developed.

40
7.5 MARKETING BUDGET
IAGON has planned to set a side adequate budget for marketing and advertising campaign. In cloud computing
business marketing is very critical for its business and attracting new customers. The company will use 10% of
its total gross revenue to fund its marketing campaign in FY-1, 8% in FY-2, 5% in FY-3 and in the same way 3% up
to FY-5.

Marketing Budget FY-1 FY-2 FY-3 FY-4 FY-5

Revenue $3,300,000 $6,600,000 $11,550,000 $23,100,000 $46,200,000

Marketing Expenses (%) 10% 8% 5% 4% 3%

Total Marketing Budget $330,000 $528,000 $577,500 $924,000 $1,386,000

8.0 PERSONNEL PLAN

The top management team of IAGON has extensive experience of Cloud Computing, Big Data, Artificial
Intelligence and Blockchain/Tangle technologies. The senior management team has passion and a future vision
of the cloud computing industry that will be powered by the advanced capabilities of AI and Blockchain/Tangle,
thereby competing in price, efficiency of storage, processing and security of data. The management teams core
strength includes its extensive understanding of decentralized storage capacities and processing power
coupling multiple smart devices into a decentralized Blockchain/Tangle grid.
IAGON’s business model and strategy are based on extensive research done to determine both market viability
and technical feasibility, including testing of a minimal viable product (MVP) of the users’ platform,
computational grid and miners’ application. Analysis of the market was conducted especially in the following
areas before launching the IAGON platform:

• What are the potential market opportunities for IAGON’s platform?

 • What type of competition exists in the target market?
 • What type of service has higher potential of return?
 • Can the targeted market support the business?
 • What types of customers will the business attract?
 • What are the rules and government legislations for operating this business from Norway?
 • How much funding is needed in startup and then to expand this business?

41
8.1 ORGANIZATION ORGANOGRAM
To carry out the IAGON mission, its organizational strategic team would be divided into six sections. The core
team will be expert on Cloud Computing, Big Data, Artificial Intelligence and Blockchain/Tangle Technology, with
many years of experience. Our organizational structure is similar to that of any other high-profile IT companies.
The initial management team consists of 3 founders and 14 team members, as the business continues to grow,
the company will hire more experts. Following is the planned organogram of the overall management team
structure.

CEO
GM Cloud GM Artificial GM Blockchain GM Admin
Computing GM Big Data Intelligence GM Finance
Technology & Marketing

Cloud Artificial Blockchain

Computing Big Data Intelligence Technology Financial Admin Marketing
Experts Experts Experts Experts Experts Team Team

9.0 FINANCIAL ANALYSIS

9.1 FINANCIAL ASSUMPTIONS

The preparation of the financial statements in conformity with US GAAP requires management to make
estimates and assumptions that affect the reported amounts of revenue and expenses and disclosure of
contingent revenue and expenses at the date of the financial statements during the reporting periods. Estimates
may include those pertaining to accruals and going concern assumptions. Actual results could materially differ
from those estimates.
The table below presents the major assumptions made during this business plan, that are important to highlight.
According to tradeeconomics.com, inflation rate in Norway (consumer price) is recorded 1.1 percent year-on-year
in November 2017 from 1.2 percent in the previous month, missing market expectations of 1.2 percent. It was the
lowest rate since February 2013. In the course of this business plan, we have assumed average 2.5% inflation rate
throughout the next 5 years9. Norway’s corporate income tax rate is 24% in 2017 (reduced from 25% in 2016)10.
Therefore, tax rate was assumed as 24% of the revenue throughout the next five years projections. We have
assumed 8% interest rate on debt financing for the next five years. The central bank of Norway left its key policy
rate unchanged at a record low of 0.5 percent on December 14th, 2017. Policymakers said that inflation is
expected to remain below 2.5 percent in the next years, although a higher rate is possible due to a weaker Krone.
In addition, the upturn in the economy continues, the output gap is narrower than projected and wage growth is
likely to edge up. Interest rate in Norway averaged 4.21% from 1991 until 2017, reaching an all-time high of 11
percent in September of 1992 and a record low of 0.5% in March of 2016. In this business plan we have assumed
0.5% interest rate throughout next five years.

9 Source: https://tradingeconomics.com/norway/inflation-cpi
10 Source: http://taxinsights.ey.com/archive/archive-news/norwegian-parliament-approves-2017-fiscal-budget.aspx 42
9.2 REVENUE PROJECTIONS
IAGON will charge commission of 10% in IAGON tokens from every transaction that the users carry out to utilize
the miners’ storage and processing capacities. The commission will be charged from the tokens transferred
from users to miners, which are tradable and can be converted into fiat money. In FY-1, $10.5 million in revenues
will be generated, whereas up to FY-5 gross revenues will reach to $147 million. Five years financial projections
are depicted in the following table:

Revenue Projections FY-1 FY-2 FY-3 FY-4 FY-5

No of Transmitted Tokens 300,000,000 600,000,000 1,050,000,000 2,100,000,000 4,200,000,000

Book Value of each Token $0.12 $0.12 $0.12 $0.12 $0.12

Total Transaction Value $36,000,000 $72,000,000 $126,000,000 $252,000,000 $504,000,000

Transaction Fee 10% 10% 10% 10% 10%

Revenue from
Transaction Fee $3,600,000 $7,200,000 $12,600,000 $25,200,000 $50,400,000

5 Years Revenue Projections

(in Millions)
60,0
$50.40

45,0

30,0 $25.20 Revenue from

Transaction
15,0 $12.60 Fee
$7.20
$3.60
0,0
FY-1 FY-2 FY-3 FY-4 FY-5

43
9.3 FIVE YEARS PROFIT & LOSS PROJECTIONS

5 Years Financial Projections

(Millions)

USD 60,00
Millions

USD 45,00

USD 30,00

USD 15,00

USD 0,00
FY-1 FY-2 FY-3 FY-4 FY-5

Gross Revenue EBIT Net Profit

The Market analysis, competitive analysis and business model of the company reveals that IAGON is a unique business
model and its target market has sufficient potential to achieve its financial goals. As presented in the graph above,
revenues and net profits of the company will increase every year. Up to fifth year of expanding the operation, the
company will be able to secure more than $50,4 million revenues and $25,2 million net profits. The complete 5 years
profit and loss projections are in the table below. Monthly Profit and Loss projection are at Annex Table 10.1 and
Quarterly Profit and Loss Projections are at Annex Table 10.2.

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9.4 FIVE YEARS PROFIT & LOSS PROJECTIONS

Profit and Loss Projections FY-1 FY-2 FY-3 FY-4 FY-5

Gross Revenue $3,600,000 $7,200,000 $12,600,000 $25,200,000 $50,400,000

Direct Cost (10%) $360,000 $720,000 $1,260,000 $2,520,000 $5,040,000

Operating Income $3,240,000 $6,480,000 $11,340,000 $22,680,000 $45,360,000

Gross Margin (%) 90.00% 90.00% 90.00% 90.00% 90.00%

EXPENSES          

Payroll $500,000 $600,000 $700,000 $1,000,000 $1,200,000

R&D Expenses $1,200,000 $1,500,000 $2,500,000 $4,000,000 $6,000,000

Marketing Expenses $500,000 $576,000 $630,000 $1,008,000 $1,512,000

Professionals/Consultants Fzes $250,000 $300,000 $350,000 $400,000 $500,000

Insurance Costs $30,000 $35,000 $40,000 $50,000 $60,000

Management and Operational

$300,000 $360,000 $630,000 $1,008,000 $2,016,000
Cost

Depreciation/Amortization of
$25,000 $35,000 $50,000 $70,000 $90,000
Assets

Misc. Expenses $200,000 $250,000 $300,000 $500,000 $750,000

Total Operating Cost $3,005,000 $3,656,000 $5,200,000 $8,036,000 $12,128,000

EBIT $235,000 $2,824,000 $6,140,000 $14,644,000 $33,232,000

EBIT Margin (%) 6,53% 39,22% 48,73% 58,11% 65,94%
Taxes (24%) $56,400 $677,760 $1,473,600 $3,514,560 $7,975,680
Interest Expense $0 $0 $0 $0 $0

Net Profit $178,600 $2,146,240 $4,666,400 $11,129,440 $25,256,320

Net Profit Margin (%) 4,96% 29,81% 37,03% 44,16% 50,11%

45
9.5 PROJECTED CASH FLOW
The business will have sufficient cash coming from commission fees to meet its operational requirements. The company
will have sufficient cash every year to meet its operational expenses. Five-year projected cash flow of the company
depicted in the table below.

Pro Forma Cash Flow FY-1 FY-2 FY-3 FY-4 FY-5

Cash from Operations $3,240,000 $6,480,000 $11,340,000 $22,680,000 $45,360,000
Cash from receivables $0 $0 $0 $0 $0
Operating Cash Flows $3,240,000 $6,480,000 $11,340,000 $22,680,000 $45,360,000
Other Cash Inflows          
Equity Investment $740,000 $0 $0 $0 $0
Debt Financing $0 $0 $0 $0  
Sales of Business Assets $0 $0 $0 $0 $0
A/P Increases $0 $0 $0 $0 $0
Total Other Cash Inflows $740,000 $0 $0 $0 $0

Total Cash Inflows $3,980,000 $6,480,000 $11,340,000 $22,680,000 $45,360,000

Cash Outflows          
Repayment of Principal $0 $0 $0 $0 $0
Cash Spent on operations $3,005,000 $3,656,000 $5,200,000 $8,036,000 $12,128,000
Payment of Interest and Taxes $56,400 $677,760 $1,473,600 $3,514,560 $7,975,680
Startup Costs $740,000 $0 $0 $0 $0
Total Cash Outflows $3,801,400 $4,333,760 $6,673,000 $11,550,560 $20,103,680
Net Cash Balance $178,600 $2,146,240 $4,666,400 $11,129,440 $25,256,320

Accumulated Cash Balance $178,600 $2,324,840 $6,991,240 $18,120,680 $43,377,000

5 Years Cash Flows (Yearly)

(in $Millions)
$45,36

$25,26
$22,68
$20,10

$11,34 $11,55$11,13

$6,48 $6,67
$3,98 $3,80 $4,33 $4,67
$2,15
$0,18

FY-1 FY-2 FY-3 FY-4 FY-5

Total Cash Inflows Total Cash Outflows Net Cash Balance

46
9.6 BREAK-EVEN ANALYSIS

Breakeven Sale Year 1 Year 2 Year 3 Year 4 Year 5

Expected Sales $3,600,000 $7,200,000 $12,600,000 $25,200,000 $50,400,000

Yearly Break-even Sales $3,338,889 $4,062,222 $5,777,778 $8,928,889 $13,475,556

Monthly Breakeven Sale $278,241 $338,519 $481,481 $744,074 $1,122,963

Breakeven Percentage 93% 56% 46% 35% 27%

5 Years Expected Sales

(in $Millions)
$60
50,40

$45
Millions

$30 25,20

$15 12,60
7,20
3,60
$0
Year 1 Year 2 Year 3 Year 4 Year 5

Expected Sales

47
10.0 APPENDIX
The following information is presented to illustrate the financial details, projections, general assumptions
and expected results. As in any business plan, success is solely dependent on the business execution and
the circumstances that surround its operations.

10.1 MONTHLY PROFIT & LOSS PROJECTIONS OF FY-1

 Monthly Profit and Loss Projections
Month-1 Month-2 Month-3 Month-4 Month-5 Month-6 Month-7 Month-8 Month-9 Month-10 Month-11 Month-12 Total Year 1

Gross Revenue $216,000 $216,000 $216,000 $216,000 $252,000 $252,000 $288,000 $324,000 $360,000 $396,000 $432,000 $432,000 $3,600,000

Direct Cost (10%) $10,800 $10,800 $10,800 $10,800 $12,600 $12,600 $14,400 $16,200 $18,000 $19,800 $21,600 $21,600 $360,000

Operating Income $205,200 $205,200 $205,200 $205,200 $239,400 $239,400 $273,600 $307,800 $342,000 $376,200 $410,400 $410,400 $3,240,000

Gross Margin (%) 95% 95% 95% 95% 95% 95% 95% 95% 95% 95% 95% 95% 90.00%

EXPENSES                         0

Payroll $41,667 $41,667 $41,667 $41,667 $41,667 41,667 $41,667 $41,667 $41,667 $41,667 $41,667 41,667 $500,000

R&D Expenses $100,000 $100,000 $100,000 $100,000 $100,000 100,000 $100,000 $100,000 $100,000 $100,000 $100,000 100,000 $1,200,000

Marketing
$41,667 $41,667 $41,667 $41,667 $41,667 41,667 $41,667 $41,667 $41,667 $41,667 $41,667 41,667 $500,000
Expenses
Professionals

$20,833 $20,833 $20,833 $20,833 $20,833 20,833 $20,833 $20,833 $20,833 $20,833 $20,833 20,833 $250,000
/Consultants Fees

Insurance Costs $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $30,000

Management

& Operational $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $300,000
Cost
Depreciation/

Amortization of $2,917 $2,917 $2,917 $2,917 $2,917 $2,917 $2,917 $2,917 $2,917 $2,917 $2,917 $2,917 $25,000

Assets

Misc. Expenses $16,667 $16,667 $16,667 $16,667 $16,667 $16,667 $16,667 $16,667 $16,667 $16,667 $16,667 $16,667 $200,000

Total Operating
$253,750 $253,750 $253,750 $253,750 $253,750 $253,750 $253,750 $253,750 $253,750 $253,750 $253,750 $253,750 $3,005,000
Cost

EBIT -$48,550 -$48,550 -$48,550 -$48,550 -$14,350 -$14,350 $19,850 $54,050 $88,250 $122,450 $156,650 $156,650 $235,000

EBIT Margin (%) -22% -22% -22% -22% -6% -6% 7% 17% 25% 31% 36% 36% 7%

Taxes (24%) $4,700 $4,700 $4,700 $4,700 $4,700 $4,700 $4,700 $4,700 $4,700 $4,700 $4,700 $4,700 $56,400

Interest Expense 0 0 0 0 0 0 0 0 0 0 0 0 0

Net Profit -$48,550 -$48,550 -$48,550 -$48,550 -$14,350 -$14,350 $19,850 $54,050 $88,250 $122,450 $156,650 $156,650 $178,600

Net Profit Margin -22% -22% -22% -22% -6% -6% 7% 17% 25% 31% 36% 36% 5%
(%)

48
10.2 QUARTERLY PROFIT & LOSS PROJECTIONS
 YEAR 4 YEAR 5
Q1 Q2 Q3 Q4 Year 4 Q1 Q2 Q3 Q4 Year 5

Gross Revenue $5,292,000 $6,048,000 $6,552,000 $7,308,000 $25,200,000 $10,584,000 $12,096,000 $13,104,000 $14,616,000 $50,400,000

Direct Cost (10%) $264,600 $302,400 $327,600 $365,400 $1,260,000 $529,200 $604,800 $655,200 $730,800 $2,520,000

Operating Income $5,027,400 $5,745,600 $6,224,400 $6,942,600 $23,940,000 $10,054,800 $11,491,200 $12,448,800 $13,885,200 $47,880,000

Gross Margin (%) 95% 95% 95% 95% 95% 95% 95% 95% 95% 95%

EXPENSES                    

Payroll 250,000 250,000 250,000 250,000 1,000,000 300,000 300,000 300,000 300,000 1,200,000

R&D Expenses 300,000 300,000 300,000 300,000 1,200,000 300,000 300,000 300,000 300,000 1,200,000

Marketing Expenses 158,760 181,440 196,560 219,240 756,000 317,520 362,880 393,120 438,480 1,512,000

Professionals /
100,000 100,000 100,000 100,000 400,000 125,000 125,000 125,000 125,000 500,000
Consultants Fees

Insurance Costs $12,500 $12,500 $12,500 $12,500 $50,000 $15,000 $15,000 $15,000 $15,000 $60,000

Management
 $252,000 $252,000 $252,000 $252,000 $1,008,000 $504,000 $504,000 $504,000 $504,000 $2,016,000
& Operational Cost

Depreciation / $8,750 $8,750 $8,750 $8,750 $35,000 $8,750 $8,750 $8,750 $8,750 $35,000
Amortization of Assets

Misc. Expenses $125,000 $125,000 $125,000 $125,000 $500,000 $187,500 $187,500 $187,500 $187,500 $750,000

Total Operating Cost $1,207,010 $1,229,690 $1,244,810 $1,267,490 $4,949,000 $1,757,770 $1,803,130 $1,833,370 $1,878,730 $7,273,000

EBIT $3,820,390 $4,515,910 $4,979,590 $5,675,110 $18,991,000 $8,297,030 $9,688,070 $10,615,430 $12,006,470 $40,607,000

EBIT Margin (%) 72% 75% 76% 78% 75% 78% 80% 81% 82% 81%

Taxes (24%) $878,640 $878,640 $878,640 $878,640 $3,514,560 $1,993,920 $1,993,920 $1,993,920 $1,993,920 $7,975,680

Interest Expense 158,760 181,440 196,560 219,240 756,000 317,520 362,880 393,120 438,480 0

Net Profit $3,661,630 $4,334,470 $4,783,030 $5,455,870 $18,235,000 $7,979,510 $9,325,190 $10,222,310 $11,567,990 $40,607,000

Net Profit Margin (%) 69% 72% 73% 75% 72% 75% 77% 78% 79% 81%

49
11.0 DISCLAIMER
By participating in the IAGON AS’ (“IAGON”) Pre-sale and/or Token Generating Event (the “TGE”) Crowdsale
(the Pre-sale and the TGE together referred to as the “Crowdsale”), as defined in the IAGON whitepaper (the
“Whitepaper”), or making use of any information in the Whitepaper or in IAGON’s business plan or available
on the iagon.com website, you agree to the statements provided in this disclaimer (the “Disclaimer”). You
further understand and accept that the information provided in the Whitepaper and on the website are of
descriptive nature only, and does not provide any legal rights to the user unless explicitly stated.
GENERAL WARNING – By using the services provided by IAGON, you as either a Crowdsale participant or
User of IAGON’s alpha products or services (the “User”), fully understands and agrees with the following:
• IAGON AS is a Norwegian incorporated entity, being subject to Norwegian laws and regulations. The
TGE is being performed from Norway under Norwegian rules and IAGON does not intend or issue any
tokens in any other jurisdiction. The User understands and accepts to be subject to the laws and
regulations in the jurisdiction in which the User is domiciled and that IAGON accepts no responsibilities
for the legal status of the User as a Crowdsale participant or otherwise being linked to IAGON (e.g. as
token holder after the TGE). The User should obtain local legal advice to clarify the legal status of the
User in its own jurisdiction before participating in the Crowdsale.
• By transferring Ether (ETH) to the Smart Contract System and the Smart Contract System creating
IAGON tokens (“IAG tokens”), the User understands and accepts that the User makes a contribution into
a Smart Contract System for the development of the IAGON platform, as described in the Whitepaper.
The User understands and acknowledges that IAG tokens will be provided by the Pre-sale and/or TGE
smart contract in the order that transactions are received by it and no alteration of this can be made by
any party. However, the User understands and accepts that smart contract technology is still in an
early development stage and its application of experimental nature, which carries significant
operational, technological, financial, regulatory and reputational risks.
• User understands and accepts that IAGON AS, including its shareholders, directors, management,
employees and any other person affiliated with IAGON, carries no liability for the ability to take part in
the Crowdfunding for reasons beyond the control of IAGON including but not limited to the Pre-sale
and/or TGE duration, transaction mining delays and node-related issues.
• Pending a successful Crowdfunding, the IAGON team members will be focused on completing the
company start-up and delivering on milestones according to the Whitepaper. Furthermore, the User
understand and accepts that while IAGON will make reasonable efforts to develop and complete the
IAGON platform, as described in the Whitepaper, it is possible that such development may fail and that
User’s IAG token may become useless and/or lose its value due to reasons of technical, commercial or
regulatory nature or any other reason, within or outside IAGON’s control.
• The User is also aware of the risk that even if all or parts of IAGON’s platform is successfully developed
and released in full or in parts, that the IAGON platform could be fully or partially closed, remain
commercially unsuccessful or shut down due to lack of public interest or for any other reason. IAGON
has the right to engage subcontractors to perform the entire or partial development and execution of
the IAGON platform. The scope and extent of the development of the IAGON platform will be
determined by the amount of contribution received during the Crowdsale, as set forth in the
Whitepaper

50
 • The User understands and accepts that IAGON undertakes no obligations to act on behalf and in the
interests of the User in any Pre-sale and/or TGE being held in the future.
• By transferring ETH through the IAGON Crowfunding address under the smart contract system of the
Ethereum blockchain protocol (address TBD (to be decided)) (the “Smart Contract System”), the User
expressly agrees to all of the terms and conditions set forth in the Smart Contract System code
existing on the Ethereum blockchain and in this Disclaimer. The User further confirms to have carefully
reviewed the Smart Contract System code, its functions and this Disclaimer, and hereby confirm to
fully understand the risks and costs of creating the IAG token and contributing into a Smart Contract
System for the development of the IAGON platform.
• The User understands and accepts that by transferring ETH or other assets to IAGON as part of the
Crowdsale through the Smart Contract System, the User makes such decision upon his/hers own
discretionary consideration and has no right of refund of the transferred amount, unless explicitly
provided by the Pre-sale and/or TGE smart contract code itself as stipulated in the Whitepaper (that
being, a 100% refund when capital raised during the Crowdfunding is under the minimum cap after the
Pre-sale and/or TGE period has expired). The User therefore understands and accepts that the transfer
of ETH through the Smart Contract System thereby creating IAG token, carry significant financial,
regulatory and/or reputational risks (including the complete loss of value of created tokens, if any, and
attributed features of the IAGON platform).
TAX WARNING – The User understands and accepts that IAGON does not act as a tax agent of User. The
User bears the sole responsibility to determine its tax responsibility of the contribution into the Smart
Contract System to create and obtain IAG token(s), and to determine whether the ownership, usage, the
potential value appreciation or depreciation, or any gain or loss by the purchase or sale of the IAG token,
have tax implications for such User. More specifically, the User fully understands and agrees to the
following:

• The User and IAGON carry their own tax obligations solely under the applicable laws of the jurisdiction
they reside in.
• If Value Added Tax (VAT) obligations or other indirect taxes will apply as a result of trade of products/
services provided by Iagon or by third parties, we reserve the right to adjust the product/service price
by adding a VAT/ indirect tax as applicable for each respective country (e.g. 25% for Norway and as
applicable in other jurisdictions) which are sold from the time the VAT / indirect tax obligations comes
into place. We will spend time and resources with qualified personnel to structure the Iagon platform
optimally within legal frames to ensure transactions flow as efficient as possible.
• The User understand and accepts that IAGON may have to disclose information on the User, including
but not limited to the value of any IAG tokens held, if explicitly requested by any government authorities
in accordance with any applicable jurisdiction.
• By creating, holding or using the IAG token, and to the extent permitted by law, the User agrees not to
hold IAGON or any associated third party, including developers, auditors, contractors or shareholders,
liable for any tax liability associated with or arising from the creation, ownership or use of IAG token or
any other action or transaction related to the IAGON platform.

51
NO WARRANTIES – All information provided within the Whitepaper and within IAGON’s business plan is
provided “AS-IS” and with no warranties whatsoever on the IAG token, the Smart Contract System and/or
the success of the IAGON platform, including the accuracy, completeness or the use of any information
provided therein, to the extent permitted by any applicable law. This includes, but is not limited to, express
or implied warranties of title, merchantability or fitness for a particular purpose, are made with respect to
the information, or any use of the information, on this site or platform.
DISCLAIMER OF LIABILITY – The User acknowledges and agrees, to the extent permitted by any applicable
law, that the User will not hold IAGON or any associated parties, including but not limited to any group
entity, management, developers, contractors or shareholders, liable for any and all damages or injury
whatsoever caused by or related to the use of, or the inability to use the IAG token, the Smart Contract
System or the IAGON platform, under any cause or action whatsoever of any kind in any jurisdiction. IAGON
specifically, without limitations, disclaims liability for any loss or damages, including incidental or
consequential damages, and assumes no responsibility or liability for any loss or damage suffered by any
person as a result of the use, misuse or reliance of any of the information or content in the Whitepaper or
in IAGON’s business plan or on the www.iagon.com website.
Under no circumstances shall IAGON, or any associated parties as stated above, be liable to the User for
any special, indirect, incidental, consequential, exemplary or punitive damages (including lost or
anticipated revenues or profits and failure to realise expected savings arising from any claim relating to
the services provided by IAGON) whether such claim is based on warranty, contract, tort (including
negligence or strict liability) or otherwise or likelihood of the same.
The User further specifically acknowledges that IAGON, or any associated parties as stated above, are not
liable, and the User agrees to not hold them liable, for the conduct of any third parties, including other
creators of IAG token(s), and that the risk of creating, holding and using IAG token(s) rests entirely with the
User.
USE AT YOUR OWN RISK – By utilizing the Crowdsale Smart Contract System for IAGON, the IAGON
platform or the www.iagon.com website, including but not limited to, the transferring of any assets to
IAGON AS, the User undertakes and understands all possible risks that directly or indirectly arise from the
activity connected with the User’s participation in the Crowdsale and/or use of IAGON’s services and
products.
FORCE-MAJEURE – User understands that IAGON will not be liable to User for any breach hereunder,
including for failure to deliver or delays in delivery of the Services occasioned by causes beyond the
control of IAGON including but not limited to unavailability of materials, strikes, labour slowdowns and
stoppages, labour shortages, lockouts, fires, floods, earthquakes, storms, droughts, adverse weather,
riots, thefts, accidents, embargoes, war (whether or not declared) or other outbreak of hostilities, civil
strife, acts of governments, acts of God, governmental acts or regulations, orders or injunctions, or other
reasons, whether similar or dissimilar to the foregoing (each a “Force Majeure Event”).
MISCELLANEOUS / FINAL WARNING – Pre-sale and/or TGE participations can be considered high-risk
trading; utilising IAG tokens via the Crowdsale or utilising services offered in the Whitepaper, through the
Smart Contract System, the IAGON platform and on the www.iagon.com website, may result in significant
losses or even in a total loss of all value submitted and obtained.

52
• This Disclaimer, the IAGON Whitepaper, the IAGON website and platform or any related documents or
site do not constitute a prospectus of any sort, is not a solicitation for investment and does not pertain
in any way to an offering of securities in any jurisdiction.
• The User guarantees that he is a legally capable person of a sufficient age, and that the User complies
with all legal rules and applicable laws of the jurisdiction where the User lives when transferring ETH to
the Smart Contract System to create IAG token. The User further confirms to be legally permitted to
hold and use the IAG token in the jurisdiction where the User is domiciled, and accepts to hold IAGON
harmless should the User not be compliant to any such laws and regulations.
• IAG tokens are only functional utility tokens and its ownership carries no other rights other than being
intended to be applied on IAGON’s platform, if successfully completed and deployed as stipulated in the
Whitepaper. In particular, the User understands and accepts that the IAG token do not represent or
constitute any ownership right or stake, share or security or equivalent rights or any right to receive
future revenues, IP rights or any other form of participation in or relating to the IAGON platform, other
than enabling access for token holders and Users to IAGON’s platform. IAGON tokens and IAGON’s
platform are not for speculative investment. No promises regarding value or future performance are
made regarding IAGON tokens. No promises regarding any particular value of IAGON tokens are made.
No other rights associated with holding IAGON tokens are given. Proceeds of the IAGON token
Crowdsale may be spent as the company sees appropriate, which may change as deemed necessary in
the maturation and advancement of the IAGON token and IAGON’s platform.
• IAGON’s team is investing heavily in the safety and security of the services that IAGON provides.
However, we cannot protect against all possible sources of error and malicious deeds initiated by any
party. Therefore all risks assumed by using IAGON’s platform in any capacity, transferring, receiving and
accumulating IAG tokens are solely assumed and accepted by the User.
• IAG tokens are meant to be held and used by those well experienced and knowledgeable in
cryptographic tokens, their acquisition, transfer, and use only for accessing the services offered on
IAGON’s platform. By transferring ETH through the Smart Contract System for the creation of the IAG
token, the User represents and warrants that it has deep understanding of the functionality, usage,
storage and transmission mechanism associated with cryptographic tokens and blockchain-based
software systems.
• The User further represents and warrants to have knowledge of the token creation process and that
the User will have its own account on the Ethereum network, with a private key associated to this
address and password. The password is used to encrypt the User’s private key. Following the creation
of the IAG token by the Smart Contract System, the IAG token will be transferred to the User's address
by the Smart Contract System. The User understands that the User must keep his password and
private key safe and that the User will not be able to generate a new password or recover his private key
should this private key and/or password be lost or stolen. The User understands that if such private
keys and/or password is lost, the IAG tokens associated with the User's account will be unrecoverable
and will be permanently lost. In such instance, IAGON or any other no person or entity will not be able to
help the User retrieve or reconstruct the lost password and/or private keys, and the User will not be
able to access any lost IAG tokens

53
 • The User understands and accepts that the IAGON platform will be run on a blockchain through a
network of miners which will ultimately be in control of the Smart Contract System. The User
understands that a majority of these miners could agree at any point to make changes to the official
Smart Contract System and to run a new version of the Smart Contract System, which could lead to the
IAG token losing its intrinsic value.
• By transferring ETH to the Smart Contract System and/or receiving IAG token, no form of partnership,
joint venture or any similar relationship between the Users and/or other individuals or entities involved
with the deployment of the Smart Contract System and the setting up of the IAGON platform is created.
• The User understands and accepts that no market liquidity may be guaranteed with regard to the IAG
token and that its value may experience extreme volatility over time, including depreciation in full.
• Should the User be a consumer and should any applicable consumer legislation or cancellation rights
apply to such User in relation to the creation and obtainment of the IAG token, the User waives any such
consumer and cancellation rights, unless otherwise prescribed by mandatory law. The User further
acknowledges and accepts that any applicable cancellation rights are waived and lost when the User
transfer ETH through the Smart Contract System and thereby creates and obtains IAG token(s), unless
otherwise prescribed by mandatory law.
• The User understands and accepts that the blockchain technology allows new forms of interaction and
that it is possible that certain jurisdictions will apply existing regulations on, or introduce new
regulations addressing, blockchain technology based applications, which may be contrary to the current
setup of the Smart Contract System and which may, inter alia, result in substantial modifications of the
Smart Contract System and/or the IAGON platform, including its termination and the loss of IAG token
for the User.
• By participating in the Crowdsale by either the Pre-sale and/or TGE, the User confirms that he has read,
understood and agree to comply with all restrictions set forth above. The User further confirms to not
obtain the IAG token for any illegal purposes and that the ETH transferred through the Smart Contract
System has not been obtained by any illegal means, including but not limited through money laundering
or corruption of any sort or any other illegal means in the jurisdiction in which the User resides.
• The User acknowledges and agrees that if any part of this Disclaimer or the Whitepaper is found illegal
or unenforceable, in whole or in part, such provision shall be ineffective solely to the extent of the
invalidity or unenforceability under the laws of the applicable jurisdiction without affecting the validity
or enforceability thereof in any other manner, and without affecting the remaining provisions of this
Disclaimer or the Whitepaper, which shall continue to be in full force and effect.
• This Disclaimer is governed by Norwegian law and any claims brought forward against IAGON arising out
of or in connection with the creation of IAG token and the development and execution of the IAGON
platform, shall be resolved and finally settled by the ordinary courts of Norway. IAGON and its team will
in any case abide within the laws set forth in each of its operational country(ies), and each operational
unit shall be subject to its local laws and jurisdiction for the explicit operation such unit provides.
• IAGON’s Whitepaper, its business plan, its website and this Disclaimer, may be subject to changes by
IAGON’s discretion, either before, during or after the Crowdsale.

This Disclaimer is valid as of 2 April 2018, as amended from time to time.

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