TRANSFORMING THE FUTURE

NASDAQ : TINY

FIRST. TRANSFORMATIVE. PROVEN.

SHAREHOLDER UPDATE CALL

JANUARY 10, 2017

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SAFE HARBOR STATEMENT

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This presentation may contain statements of a forward-looking nature relating to future events. Statements contained in this presentation that are forward-lookingstatements are intended to be made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statementsare subject to the inherent uncertainties in predicting future results and conditions. These statements reflect the Company’s current beliefs, and a number of importantfactors could cause actual results to differ materially from those expressed herein.

Please see the Company’s Annual Report on Form 10-K, as well as subsequent filings, filed with the Securities and Exchange Commission for a more detailed discussionof the risks and uncertainties associated with the Company’s business, including but not limited to the risks and uncertainties associated with venture capital investingand other significant factors that could affect the Company’s actual results. Except as otherwise required by Federal securities laws, Harris & Harris Group, Inc.undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties.

In connection with the transactions referred to in this communication, the Company will file a definitive proxy statement and related materials with the Securities andExchange Commission ("SEC") pertaining to a Special Meeting of Shareholders (the "Special Meeting"). SHAREHOLDERS ARE URGED TO READ THESE MATERIALS(INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO), AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE SPECIAL MEETINGTHAT THE COMPANY WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE, BECAUSE THESE MATERIALS WILL CONTAIN IMPORTANT INFORMATIONABOUT THE COMPANY AND THE SPECIAL MEETING. Shareholders will be able to obtain a free copy of that definitive proxy statement and other materials (whenavailable) that the Company files with the SEC at the SEC's website at http://www.sec.gov. That definitive proxy statement and these other materials will also beavailable free of charge by directing a request to Harris & Harris Group, Inc., Attn: Investor Relations, 1450 Broadway, 24th Floor, New York, NY 10018, or from theCompany at www.hhvc.com.

The Company, its directors and its named executive officers may be deemed to be participants in the solicitation of proxies from the Company's shareholders inconnection with the Special Meeting. Shareholders may obtain information regarding the names, affiliations and interests of such individuals in the Company's proxystatement filed on April 20, 2016, for the 2016 Annual Meeting of Shareholders. To the extent that holdings of the Company's securities on the part of those individualshave changed since the date of that proxy statement, those changes have been reflected on Statements of Changes in Ownership on Forms 3 or 4 filed with theSEC. These documents can be obtained free of charge from the sources indicated above. More current information regarding the interests of the directors and namedexecutive officers of the Company will be contained in the definitive proxy statement referred to in the preceding paragraph.

WE NEED TO CHANGE

In letters to shareholders over the last few years we noted the challenges we face in our business:

• Changing nature of venture capital requires greater control over investments

• Structural changes in the public markets have reduced small IPOs dramatically, with companies staying private longer and requiring more capital from us

• We believe that our BDC structure presents significant hurdles to us

• Regulatory burdens imposed post-2004 have had a high cost to small firms such as ours

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CHANGE ANNOUNCED IN DECEMBER 20, 2016 LETTER

1. Separate Harris & Harris Group, Inc. into two companies:

A. 180 Degree Capital Corp (“180”) – shepherd our existing portfolio to attempt to maximizereturns by investing in what we believe are undervalued small, publicly traded companieswith potential for aggressive growth in a structure that seeks to reduce our expenses

B. HALE.life Corp (“HALE”) – an operating company that takes a portion of our precisionhealth and medicine assets and combines them to deliver products that we believe havethe potential to change how physicians provide and patients receive healthcare

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BENEFITS OF RESTRUCTURING PATH

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We believe this restructuring :

1) Is the best opportunity to increase shareholder value

2) Focuses the company and permits clear strategic messaging

3) Allows the maturing portfolio to reach exits in a cost-effective manner

4) Provides income and net asset growth over shorter, more predictabletimeframes

5) Enables us to grow our precision health and medicine assets by combiningthem into a controlled operating company

ValueCreationThroughConstructiveActivism

InvestorPresentation

January2017

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Firm Overview

• FormedfrominvestmentmanagementbusinessofHarris&HarrisGroup.

• RestructuredfromBDCtoclosed-endfund:• reduceoperatingcostsandregulatoryburden.• increasemanagementtimeonvaluecreationforshareholders.

• LedbyKevinRendino,CEO,andDanielWolfe,President,CFO,CCO.

• Initialfocusonshepherdingexistingportfoliotoattempttomaximizevalue.

• Futureinvestmentfocusinvaluecreationthroughconstructiveactivisminwhatwebelievearedeeplyundervaluedpublic companies.

Webelieve180willbeabletogenerateincomeandgrowNAV/shareovershorter,morepredictable timeframesthanourhistoricalnorms.

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Executive Management

KevinRendino,CEOof180DegreeCapitalCorp,isafinancialservicesleaderwiththreedecadesofWallStreetexperienceandexpertiseincapitalmarkets,valueinvestingandglobalequitymarkets.Forovertwentyyears,Kevinworkedononefund,BasicValueFund,withaconsistentGrahamandDoddfocus,atthesamefirm,BlackRock/MerrillLynch.HewastheValueteamleader,overseeing11fundsand$13Binassets,amemberofBlackrock’sLeadershipCommitteeandafrequentcontributortoCNBC,BloombergTV,FoxBusiness,TheNewYorkTimesandTheWallStreetJournal.Fortheentiretyofhismoneymanagementcareer,12/31/92to6/30/12,Kevinrankedintopquartile,andbeatcompetitoraverageandSPXbyover100basispoints.HealsoreceivednumerousLipperawardsforInvestmentExcellenceduringhistenure.Since2012,KevinhasservedasChairman/CEOofRGJCapital,whereheleadsavalueinvestingfocus.

DanielWolfe,President,ChiefFinancialOfficerandChiefComplianceOfficerof180DegreeCapitalCorp, isresponsibleforday-to-daymanagementoftheoperations,finance,legalandcompliancefunctionsofthefirm,aswellasbeingactiveinthemanagementofthecompany’sinvestmentportfolio.Danielhassignificantexperienceincapitalformationatallstagesofacompany’sevolutionincludingsourcingandstructuringofprivate,publicanddebtfinancingsandidentifyingandevaluatingM&Aopportunities.HealsoestablishedandmanagestheCompany’sco-investmentfund,H&HCo-InvestmentPartners,LLCandestablishedandexecutedH&H’sdebtinvestmentstrategy,designingandstructuringthesecuritiesthroughwhich180’spredecessor,Harris&HarrisGroup,invested.Heisacurrentandpastmemberoftheboardofdirectorsofmultipleprivatelyheldportfoliocompaniesandonepubliclytradedportfoliocompany.

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Initial Focus: Seek Maximization of Returns from Existing Portfolio

• Webelieveourexistingportfoliocangeneratemeaningfulaggregategainsonaggregateinvestedcapitalovertime.

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TopTenInvestmentsBy Value(1)

PortfolioCompany Valueasof09/30/2016Cumulative%ofEquityFocusedVentureCapital

PortfolioD-WaveSystems,Inc. $11,498,191 22%

AgBiome,LLC $7,837,991 37%HZO,Inc. $5,755,099 48%

AdestoTechnologiesCorporation(2) $3,274,256 54%TARABIosystems,Inc. $3,223,388 60%

MersanaTherapeutics,Inc. $2,784,940 65%ORIG3N,Inc. $2,669,372 71%EchoPixel,Inc. $1,687,431 74%

ProducedWaterAbsorbents,Inc. $1,424,750 76%NGXBio,Inc. $1,372,767 79%

(1) DoesnotincludeholdingsofMetabolon,Inc.astheseholdingsweresoldduringthefourthquarterof2016.(2) Publiclytradedportfoliocompany.ValueasofDecember30,2016.Note:Amountsrealizedfromallinvestmentsmaybemateriallydifferentthanthevalueslistedabove.

We Believe Our Structure Has Inherent Unrecognized Value

• Webelievethatthepublicmarketsarenotcurrentlyattributingvaluetoourstructurethataffords:• Permanentcapital• Flexibleinvestmentfocus• Abilitytoraisecapitalintoandmanagedrop-downfunds• Acleanstructureforpubliclistingofprivatefund

• Webelievethatournewsimplifiedstructureandfocuscouldleadtopartnershipsorotheropportunities.

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Our Go-Forward Investment Focus

• WeneedtogenerateincomeandgrowNAV/shareovershorter,morepredictabletimeframesthanourhistoricalnorms.ThisisachallengeforH&H’shistoricalmodelofinvestinginprivatecompanies.

• Go-forwardinvestmentfocus:• Identifyandtargetwhatwebelievearedeeplyundervaluedpublic companies wherewe:

• Understandthemarketsthatthesecompaniestarget• Canpurchasemeaningfulownership/control• Believewecanaddvaluethroughactive,hands-onconstructiveactivism• Investatvaluationsthatprovidesignificantmarginofsafety• Identifycatalysts/changesthatwebelievecanunlockvalue• Believewecangeneratemeaningfulreturnsin1-3 years.

• Initialfocuson<$100millionmarketcapitalizationpubliccompanies.

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Opportunity Analysis

• WhydoestheopportunityforvaluecreationexistinU.S.micro-capitalizationpubliclytradedstocks?• Managementandboardsoften:

• Prioritizegrowthovercashflows• Overvaluemarketperceptionofstoryversuscertainty• Favorstatusquoratherthanchange• Lackintimateknowledgeofdesiresof”buyside”investorsandtheworkingsofthepublicmarketsingeneral

• Mischaracterize“short-termviability”asdetractorof“long-termgrowth”

• Analystcoverageisminisculetonon-existent.

• Fewinvestorsarewilling/abletospendthetimeandenergyidentifying,conductingdiligenceandactivelyengagingwithsuchcompanies.

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Elements of Constructive Activism

• Wearenot corporateraiders.Ourultimategoalistoengageconstructivelywithexistingboardsandmanagementteamstounlockvaluethrough:• Realignmentoffinancialperformancetoachievegrowthofcashflowsnotjustrevenues• Improvinginvestorrelationsstrategiesandoutreach• Evaluationofstrategicoptionsincludingmergers,acquisitions,sales,divestitures• Identificationofcomplementarytalentandexpertise• Introductionstovalue-addresourcesandcapabilities• Alignmentofinterestswithandsupportfromlargeshareholders

• Wearenotadverse,however,topursuingchangethroughotherroutesincluding:• Privateandpublicshareholdercommunications• Proxysolicitations

• Alleffortswillbegroundedbyandbasedonourfundamentalresearchanddiligence.

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Shareholder Activism in Small Capitalization Companies is Growing

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Source:ActivistInsight;DatathroughJuly2016.

“[FromJanuarytoJuly2016],61micro-capcompanies,thosewithamarketcapitalisationof$50mto$250m,havefoundthemselvesonthereceivingendofattentionfromactivistfunds...because[these]companiesarelesswellresearchedbyanalysts,haveaccesstofewercorporateadvisers,andarelesslikelytofollowcorporategovernancebestpractices,thepotentialforunlockingbigsharepricegainsmaybegreaterthanatlargergroups”

Source:FinancialTimes,August28,2016

CompaniesReceivingActivistAtte

ntion

Our Strategy Shifts the Control of Value Creation Back to Us

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VentureCapital(HistoricalH&HFocus)

Traditional, Long-OnlyMicro-CapitalizationFunds 180DegreeCapitalCorp

Target Privately heldcompanies Anypubliccompany Anypubliccompany

Value/Entry Price Uncertain duetoprivatestatus At market,nopremiumAtmarket,no premium(commonstock)

Potentialatorbelowmarket(income-producingsecurities)

Securities Non-incomeproducingconvertiblepreferredstock Common stock

Commonstock(primaryfocus);preferredstockandincome-producing

securities(secondaryfocus)

Plan Initialcontrol thatdiminishesovertimeduetoadditionalfundraising Nocontrol Constructiveactivism(1)

ExecutionInfluence Active-> passiveovertime Passive/dependent ownershipsize Active/dependentownership size

LiquidityIlliquid

Requiressaleofcompany,IPOorsecondarysale

Liquid(2)Can exitthroughsaleofstockinopenmarket(2)

Liquid(2)Can exitthroughsaleofstockinopenmarket(2)

InvestmentTimeline Needs willingbuyer,secondarysaleorpublicoffering

Inabilitytocontroltimetoreachpricetarget

Potential opportunitytorealizeinvestmentsearlyif/whenmarket

reflectsvalue

ControlofExitTiming Generallylittle tonone Full control(2) Full control(2)

(1) Subject,incertaincases,toshareholdersand/orboardapprovalaswellasapplicablelaw.(2) Subjecttoapplicablelaw.

What Will Shareholders See If We ChangeFrom a BDC to a Closed End Fund

• Loweroperatingexpensesresultingprimarilyfromlessregulatoryburden.• Currentestimatedsavingsofatleast$800kperyear.

• FinancialreportswillbefiledwiththeSECon:• FormsN-CSR(AnnualReport),N-CSRS(SemiannualReport),andN-Q(OffQuarters)asaclosedendfund;versus• Forms10-K(AnnualReport)and10-Q(QuarterlyReports)asaBDC.

• NochangeinvaluationprocessusedtodeterminefairvalueofLevel3(privatelyheld)investments.

16Note:AmorecomprehensivecomparisonofaBDCtoaclosedendfundwillbeprovidedinadefinitiveproxystatementandrelatedmaterialsinconnectionwithaspecialmeetingofshareholdersrelated,inpart,tothepotentialwithdrawalofHarris&HarrisGroup’selectiontobetreatedasabusinessdevelopmentcompany.

Summary

• Initialfocusonshepherdingexistingportfoliotoattempttomaximizevalueatreducedexpensetoshareholders.

• Futureinvestmentfocusinvaluecreationthroughconstructiveactivisminwhatwebelievearedeeplyundervaluedpublic companies.

• Weareactivelyseekingopportunitiestopartnerwithothersseekingsimilarstrategies.

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KevinM.Rendinokevin@180degreecapital.com

DanielB.Wolfedaniel@180degreecapital.com

ALE.LIFE CORP

www.hale.life

HealthcarethatisPrecise,Predictive,Collaborative

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HALE.lifeprovidesindividualizedinformationfromnext-generation,precisionmedicineproductstophysiciansandconsumersthroughsoftwaremanagementsystems

usedbythegrowingpopulationoffunctionalandintegrativemedicinepractices

TheOpportunity:• $250BillionPrimaryCare

Marketreadyfordisruption

• Consumersareexpectingmorefrommedicine(andwillingtopayforit)

• Newprecisionmedicinesolutionsarereadyforprimetime:Genetics,Metabolomics,Microbiome,andOthersØBut,theyarehardtoaccess

PrecisionMedicineTechnologies

PracticeManagementSystem

Consumers

ProprietaryAnalyticsPlatform

CommunicationPortal

FunctionalMedicinePractices

HALE.life2017Milestones1. Fundraising&strategic

partnerships2. Unlockingnewmarkets

forMuses’analyticalproducts

3. OpeningexpansionopportunitiesforEssential’sfunctionalmedicinemanagementservices

ØMajorplayersaregrowinginthespace

ØAcquisitionandInvestmentValidation

HLIRaised$120Million

at$1.2BillionValuation

MergeHealthcare$1BillionAcquisition

byIBM

InvitaeRaised$102MillioninIPO,InitialMktCapof

$500Million

FoundationMedicine$1BillionAcquisitionofControllingInterest

byRoche

PrecisionHealthInitiative

$215MillioninFunding

Healthways$850+MillionMarket

Cap