quantiply scotland kickoff event
TRANSCRIPT
#QuantScot // @quantiplyco
Agenda
1. Introduction - Richard Blakesley // Quantiply2. Scotland - Sandy Finlayson // MBM Commercial3. The Process - Matt Johnson // Quantiply4. Martin Brassell // Inngot5. Stephen Robertson // Metis Partners6. Steven Baird // Corporate Financier7. Julio Romo // twofourseven8. Workshop9. Rachel Gwyon // Scottish Government
10. Next Steps11. Drinks/Refreshments
#QuantScot // @quantiplyco
We...
● Are a financial technology company
● Connect Innovative Growth Companies with IP-Intelligent Finance
○ Ensuring that the most critical IP assets are tied into funding decisions
● Deliver the tools and analysis to ensure you are investment ready
#QuantScot // @quantiplyco
Challenge: Disruption and Fragmentation
● Opendesk is a global platform for local making. You can use it to download, make and buy work space furniture.
● What are their assets? How do you value them?
● Disruption and fragmentation is not reserved for financial services - it is happening across all industry sectors
Opportunity or threat?
#QuantScot // @quantiplyco
Intangibles Are THE Source of Economic Growth
Rise of Investment in Intangible Assets
#QuantScot // @quantiplyco
Debunking the Myth: It’s Not a Funding Gap!
● There is plenty of finance available
● Problem: funds not flowing to innovative high growth companies
WHY?
● Reactionary approach of funders
● Lack of transparency in valuation
● Lack of data in asset pricing
RISK AND VALIDATION GAP
#QuantScot // @quantiplyco
Market Size
● 640,000 growing SMEs
● 50,000 startups
● 8,000 scale-ups
50 PERCENTProportion of jobs created in the UK by just 6% of the fastest growing companies
£38.7 BILLIONAdditional turnover over 3 years if we move 1% of SMEs into high-growth category
#QuantScot // @quantiplyco
Our Solution
Signpost businesses to support services to ensure they are ready for investment
Identify & connect companies to right sources of capital for their current stage of growth
Deliver tools and analysis to fill risk and validation gap and enable IP-intelligent finance
#QuantScot // @quantiplyco
Quantiply Helps Advisers/Mentors Support Startups
● We are collaborators not competitors
● Checklist and tools to help support companies to ensure they are investment ready
● Use feedback and dashboards to help companies come to best decisions on how to proceed
● Work with company to weigh funding options outlined and suggested by Quantiply
#QuantScot // @quantiplyco
The Virtuous Circle
DataVolumeStandardisationAccuracyConsistencySuccess Rate
#QuantScot // @quantiplyco
The Virtuous Circle (cont)
Growth CompaniesHave: Investable business modelsCapacity to scale and grow
Need: Consistent and appropriate supportAccess to whole of market for finance & services
Services/FinanceHave: Service expertiseLocal and/or national reach
Need: Validated leadsConsistent access to volume business
Regional GovernmentsHave: Access to local ecosystemPower to convene
Need: National services delivered locallyCatalyst for ongoing innovation & scale-up
Accelerators/IncubatorsHave: Cohorts of growth companiesMentors & consultants
Need: IP-specific servicesFocused access to finance support
#QuantScot // @quantiplyco
Our Revenue Model
● No upfront cost to growth companies
○ Only pay for services used
○ No equity taken
● Referral fees from service providers
● Success fees from growth companies with successful fundraise (2 percent of raise)
#QuantScot // @quantiplyco
What’s in it for you?
● Growth Companies:
○ Get prepared for IP-intelligent finance
○ We connect you to appropriate finance providers taking the guesswork out of where to go for finance
● Finance and Service Providers:
○ Quantiply provides well prepared and qualified leads with a clear picture of IP value
● Begin today: quantiply.co/begin
#QuantScot // @quantiplyco
Quantiply Scotland
● Launch of Quantiply Scotland pilot tonight
● First step in plan to establish permanent presence on the ground
● Improve flow of capital to Scotland to augment existing resources
#QuantScot // @quantiplyco
Quantiply Platform
Quantiply Investment PanelDevelop IP evaluationCreate Quantiply profile Investment readiness dashboard Connect with finance
ONLINE WORKFLOW PLATFORM
#QuantScot // @quantiplyco
Services On Our Platform
R&D Tax Credits
PR/Communications
Marketing
General Legal
IP LegalInsurance
IP Strategy
Business PlanGrants
Human Resources
Accounting
#QuantScot // @quantiplyco
Match To Finance
● Identify appropriate types of finance
○ Equity, debt, grants, peer-to-peer, crowdfunding...
● Use Quantiply and third-party data to identify similar deals
○ Who is funding similar businesses
● Introduce companies to appropriate finance providers
○ We provide qualified deal flow of investor-ready propositions, enhancing chances of successful funding outcome
Intellectual property and finance: the backdrop“Too often, through risk aversion or banks’ conservative lending practices linked to property as security, IP is not catered for by traditional bank lending. Intellectual Property is too important an asset to be undervalued by banks who are the main source of finance.
“That is why I commissioned a report to explore how we can improve SMEs’ access to capital. We will look carefully at its recommendations in order to better support this country’s creators and IP-rich businesses.”
Secretary of State for Business, Innovation & Skills, October 2013
Intellectual property and finance: the positionEquity investors ‘get’ IP (to a degree)• They care a lot about growth, and therefore opportunity and risk, in which
IP has a central role • They have an opportunity to benefit from value appreciation
High street banks have generally found IP difficult• Normally take commodities as collateral (and/or use personal guarantees)• No experience with IP – don’t know what it would be worth in default, or
how to realize value from it• Because IP is unique, every example looks like a ‘one-off’
However, things are beginning to change…• Banks and alternative lenders are increasingly aware that many
companies just don’t have or use tangible assets any more…
Four steps to make IP bankable (and more investable)Standardize the way value-producing intellectual property and intangible assets are identified and described
Routinely consider how protection could be improved
Quantify the value that the assets represent
Check the portfolio’s credentials
AssetProfile
AppraiseAction Plan
SollomonIP Valuation
InnsightReport
Intermission: a post-lunch guide to intangible assets
Formal intellectual property rights like patents, trade marks, industrial designs, copyright
Non-physical things you own, like trade secrets, processes,
know-how, contracts – ‘intangibles’
All intellectual capital you don’t own, but you use – including your team, and IP licensed to you
Inngot profiles: describing the whole ‘egg’
Know-how250+ types 17 ‘families’
Benefits26 types
3 ‘families’
Markets20 sectors
350+ sub-sectors
Intellectual assets5 families60 types
Registered IP rightsPatents, trade marks,
registered designs
Development stage6 stages
18 sub-stages
Helps you generate a standardized, comprehensive inventory
Appraise report: actionable IP insights
Automatically generated on completion of your profile
Provides ‘flags’, explanations and links in three categories• Risks – areas where your IP could be vulnerable• Opportunities – ways to strengthen or broaden your IP• Information – things you should know about the assets identified
Review items, mark as complete, and return as often as you like
Critiques what you have identified
Sollomon IP valuation: simple and consistent
Investment5 questions
Use historical accounts and estimates
HistoryUp to 8 questions for trading businessesUse historical accounts where applicable
Forecasts5 questions
3+ years’ projections required
Governance‘Hygiene factors’
3-5 questions
Immediate report online ; all results checked/moderated offline
Innsight report: cross-checking of salient factsEssential information on five topics• Quantity/quality of investment involved• Ongoing commitment to innovation and development• Contribution of assets to income• Security potential• Ownership position
Refreshes the parts online tools can’t…
Basic ‘due diligence’ to increase lender/investor confidence
Straightforward, useful and enlightening
Visit www.inngot.com to learn more
‘We think it’s a really good, structured process. I would thoroughly recommend it to an early stage business’
Chris WalkerDiamond Hard Surfaces
‘It reminded us why we set the business up. It was incredibly useful... It just enables discussions really’
Tim ChaterKoji Drinks
‘The action plan addresses loads of things we would never have thought of… it’s a very straightforward process’
Alexei LeveneDesolenator
‘The tool was brilliant…What it did do was show that we had more or less covered all the bases’
RussellTrident Cloud
‘Great tools: I have been looking for something like this, as I am aware of the lack of IP knowledge among banks and funders.’
Robert GordonIntelligent Organics
HOW COMMUNICATIONS AND MARKETING CAN POSITION YOU FOR SUCCESS
YOUR START-UP NEEDSINVESTMENT AND PEOPLE
PROFESSIONAL COMMUNICATIONS AND MARKETING THAT HELPS …
…SECURING ANGEL INVESTMENT AND
VENTURE CAPITAL TO GOING PUBLIC
COMMUNICATIONS FACT
Research from DAVID KIRSCH,* BRENT GOLDFARB, and AZI GERA
H. Smith School of Business, University of Maryland (2009)
WHAT INVESTORS EXPECT
● Details on your marketing and communications
●Who your audiences are
●What your messages are
●Your spend on branding, marketing and communications
●If you have ownership of your digital footprint
●Media and stakeholder relations experience of your founders
WHY COMMUNICATIONS IS ESSENTIAL
➔ Communications is more than just PR and media relations
➔ It helps identify your audiences and stakeholders
➔ It establishes your messaging and your tone-of-voice
➔ It uses communications to build relevancy with each audience group
➔ It works to build reputation and trust
➔ It supports business developmentReid Hoffmann Venture Capital Journal
CONTACTJulio Romo, MCIPRCommunications Consultant, Digital and Innovation Strategist
T: UK: +44 7812 374040
Blog: www.twofourseven.co.uk/blog
: tfs.me/21stPR
: twitter.com/twofourseven
: linkedin.com/in/twofourseven
Contributing Author of the top-selling CIPRShare This and Share This Too -The Social Media Handbooks for PR Professionals
#QuantScot // @quantiplyco
Case Study: Bowie Bonds
★ In mid-90’s David Bowie and his manager were looking for ways to raise cash from his back catalogue
★ The innovation was ‘Bowie Bonds’ - asset-backed securities where the underlying asset was intangible
★ Investors bought a share of royalties generated by the songs over next ten years
★ Bowie raised $55m and added a financial innovation to his long list of creative innovations
#QuantScot // @quantiplyco
Discussion
Which part of the markets work? Which parts don’t? What are your biggest frustrations?
What innovation(s) in finance could help solve the funding challenges which growth companies face?
How can technology help?
Elect someone from your team to introduce companies at the table and your takeaways from the discussion
#QuantScot // @quantiplyco
What Happens Next?
1. Go to quantiply.co/begin
2. Create profile
3. Link over to Inngot and use code QPY52456
4. Develop your inventory and valuation if appropriate
5. We will come back with your QIP analysis and services dashboard
6. 15 March: Investment Readiness Workshop
7. 19 April: Investor Showcase