Investing in Deeptech

EBAN 25th November 2019

© Peter Cowley November 2019

7 (soon 8) positive exits, 13 failures, 51 living25 DEEPTECH 2

What is deeptech?

Based on substantial scientific advances and high-tech engineering innovation Requires lengthy R&D and may take a long time to reach commercial applicationOften requires large investments to achieve commercial successUnderlying intellectual property (IP) usually well-protected and hard to reproduce – hence strong competitive advantage or barrier to entryPatents and/or knowhowNascent or non-existent marketTechnology Readiness Level 3 (or 4) Proof of Concept (or validated in Lab)

© Peter Cowley November 2019 3

The Cambridge model

Recruit the best academics in the world

Give them the freedom to do what they choose

IP belongs to the University unless requested by the academics

2018:

482 new patent filings

315 company ideas reviewed

33 companies funded

Cambridge startups (2002-2011)

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Sourcing opportunitiesReactive

Proactive

Academic founders: can they and/or do they want to build a business?

Sourcing CEOs

Exiting:

Licensing

IP/acquihire

EBITDA multiple

Failure – why?

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Deeptech examples from my portfolio

© Peter Cowley November 2019 7

Deeptech failures

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