Mindflair (LSE:MFAI) — Investor Presentation

0:03 Good morning, ladies and gentlemen, and welcome to the Piraeus Investments Investor Presentation. Before we begin, we would like to submit the following poll. For your information throughout this presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time using the Q and A tab that's situated on the right hand corner of your screen. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. These will be available via your Investor Meet company dashboard. Finally, I'd like to remind you that this presentation is being recorded. I'd now like to hand over to Nicholas Lee and Barry Downs for the presentation. Thank you, guys.

0:49 Thank you, Mark. Welcome everybody to an investor presentation on Piraeus Investments PLC. So as as Mark said, I'm Nick Bian, I'm a director of Piraeus, and I'm here with Barry Downs who's the managing partner of Shore Valley Ventures. So I'm gonna give you really an overview of the of the company, and then I'm gonna ask Barry to drill down into the more detail into the companies that are sitting within the portfolio.

1:17 So in overview, Peeris is investment company listed on AIM, and it's very much focused on investing in the next generation technology companies. We've already established a very exciting portfolio covering some really high growth, high-tech companies across really what I would say are the sort of cutting edge of the technology sectors. So this includes artificial intelligence, cybersecurity, Internet of Things, augmented and virtual reality. And, you know, by investing into into periods, you know, it's a great way for investors to get early access to these very exciting companies with some significant growth potential.

2:07 In sort of an outline, you know, we we got into this portfolio principally through taking a position in a venture capital fund, Shore Value Ventures, which Barry is the managing partner of. But at the same time, we have also got another investment called Get Visibility, which we've invested in indirectly. And that, again, it's a very exciting company. It really focuses on using artificial intelligence to classify and discover and protect organizations' data, particularly relevant at the moment with the growth in data legislation and the significant increase in cybercrime that's been noted recently. So if I go on to the next page, which really talks about vision and strategy. So our strategy is pretty pretty clear.

2:54 So we we do a number of things. We will look to invest in high growth companies directly or through co investing in follow on rounds, in particular, in in in the companies within the the Shore Valley Ventures portfolio. We will also make the investment like we have done in Shore Valley Ventures, which really gives us our exposure to an interesting portfolios and an ability to make follow on investments into those companies. And then the third area really is looking at, you know, more mature technology companies, maybe that are that are profitable, maybe at the pre pre IPO stage. So those are the the the key elements of our strategy. So how have we been doing so far? Well, we really only started this this sort of focus of investing really back in September of last year.

3:49 And since then, we believe we've made some really attractive returns. So in particular, just for people to note that realizations that are made within the fund, that cash gets returned directly to to investors, doesn't sit in the fund. So during the life of the fund,

4:10 we're expecting to make some significant cash realizations. And we've already done that today. So just to give you an example, back in December last year, the fund sold a company called Automatics at some 500% increase in its original investment, and that returned around €800,000 to to Pires. More recently, another one of the the portfolio companies, VRE, which is which is listed on AIM, a number of shares in that company were sold to return the the the original investment. And then within the balance of the portfolio, as as new funding rounds come through, the fund has been able to recognize some really significant increases in in valuation. So the recent ones we can we can point to, admix 450% up, war ducks another 450% up, and then most recently, buy me, which is particularly sort of relevant for today's COVID nineteen environment, which is an online grocery retailer.

5:17 That was up 200% literally two months after the original investment. So really, in in a very, very short period of time, we've made some significant returns from our original investment. So just to sort of summarize that as to the what is the investment case for periods? Why invest in periods? Well, we have a clearly defined strategy. The portfolio we've got is incredibly high quality, high growth with lots and lots of potential for some significant gains. And that's just not an idle promise. We've already achieved returns from the portfolio as I've just outlined with automatics and VRE in particular. All the companies really within the portfolio have got a a presence in really some some large fast growing markets.

6:08 And as Barry will discuss later on in terms of sort of the impact of COVID nineteen, we believe a number of those companies are gonna grow even more quickly than we originally expected. We then have some a lot of sector expertise through our our relationship with Barry and his team who are incredibly experienced in the in the technology space. And thirdly, given given what we think is the potential in the portfolio, we think the company is really quite undervalued. So on that note, I'm gonna ask I'm gonna hand over to Barry to go through sorry, Barry. To go through the companies within the portfolio in more detail. Thank you very much, Julian.

6:56 You can see in this slide here in front of you, slide five, that we have distributed our investments across the core areas, that Nick outlined, that Piraeus would invest in. So for example, there's a on the left hand side of that slide, you can see a broad area of investment into what are called immersive technologies. For example, AOR being augmented reality and VOR being virtual reality. And, of course, you can see in those Venn diagrams some overlap as well. So, for example, VividQ, is a Cambridge based company in the augmented reality display space, particularly using holography as a pure play, AR company, whereas ADMIX, which is a company based in Shoreditch, it provides a monetization platform to video games, augmented reality, and virtual reality. So it's so it's right in the middle of the AR and VR sectors that we invest in.

8:12 On the right hand side, what you can see is, investments in IoT or the Internet of Things, artificial intelligence or AI. And, actually, there's an overlap of those, and there's also an overlap of security as well. And security is in a kind of an emergent area that we're investing in. And you can see right in the center there, there's a company called Novelia, and that's an IoT security AI company, which which we'll talk about a little bit later on as well. And you can see in this diagram as well at the bottom of the AI, set, Artematics, which is the company that Nick mentioned that we sold recently.

9:00 So I'll talk about each of these companies in a little bit of detail as we go on to give you better sense as to the the companies in the portfolio. But firstly, let me move on to slide seven that talks about some of our partnerships. So when we invest in software companies, our strategy is to invest in them at an early stage and then help grow the companies and actually do further investments as the company is growing as well. And as part of doing that, we partner with other leading investors across the world, really. And you can see in this slide, the logos of some of those investors and some to highlight, for example, HTC in Taiwan, which is a giant, electronics company invested in immersive VR education a few weeks ago, And Utech, which are based in Japan, have invested in e q have invested in VividQ.

10:14 And Sweden's EQT, which is a very, very large pan European venture capital fund, have invested in WarDucks. And then Octopus, who I'm sure everybody knows, are also invested in immersive VR education as well. And more recently, WeChat have invested in Buy Me as well. So, also, investors in the in Shore Valley Ventures, the underlying fund, include the Irish government, and we invest across The UK and Ireland. And the fund is regulated. The fund is domiciled in Dublin, but all investment management is run out of London. So we're regulated both by the Central Bank of Ireland and also by the FCA in London as well.

11:06 Now to to give you a bit of a better understanding of the portfolio companies, this, I've moved on to slide seven. And that's focused on some of the artificial intelligence companies. Now, of course, bear in mind that, an AI company could also be a IoT company or also sometimes a security company as well in the case of Novalea. But I'll I'll I'll quickly give you an overview of each of those companies. The first thing to say is that, you know, AI as a sector to invest in is experiencing rapid growth right now. And a number of analysts' estimates put it as, you know, about $14,000,000,000 market right now, growing to over a 100,000,000,000 by 2025.

11:56 So the key thing about that is that each of the companies that we invest in have a tailwind behind them in which to grow into through a rapidly expanding market. And we saw that very clearly through, Artematics, the first company there. So Artematics is a company that uses AI to automate a lot of the content creation tasks that people would do in the in the creation of animated movies, video games, and augmented and virtual reality technologies. And in many cases, particularly for artist led work tasks, can automate up to 80% of the work.

12:46 And so as you can imagine, this is very valuable technology because a video game, a typical, what you would call a triple a video game, could take, you know, four years to bring to market, cost $300,000,000. And so if you could automate significant processes in that, in in the creation of the video game, it creates a lot of value for for companies. As a result of that, we we were only in that business, fourteen months. Normally, we do like to stay invest in businesses and and keep them in the portfolio for a little longer than that. Fourteen months is is quite quick. But what actually happened there is the kind of leading player in the video game creation space, which is Unity Technologies out of San Francisco, saw the, saw the great work the team was doing and made an offer, to acquire cash offer to acquire the company.

13:44 And, it was a good it was a very good offer. It gave us a 500% return over fourteen months. That's about just just just over 400% IRR. And so we we decided, along with the founders, decided to take that offer. But it shows the potential of AI, to create amazing productivity, and also to be very valuable as well. The second company there, GetVisibility, is a company that we coinvested in Shore Valley coinvested in with Pirate. So Pirate has a direct holding in that company as well in in addition to a to a holding through Shore Valley. And that's that's an amazing company that handles a really critical enterprise problem in terms of data security.

14:38 So everybody's probably pretty familiar, I'm sure, with GDPR and HIPAA and other regulations for enterprises. And there's been a lot of work done by by security companies and by enterprises to protect data in databases. But it turns out that data in databases is, in many cases, less than 20% of a data in an organization. The other 80% is in unstructured data. For example, Word files, PowerPoint, Excel, PDFs. And that's typically not very well controlled at all. And part of the reason is that organizations don't even know what's in these documents. And so what get visibility does is use AI at scale to discover, classify, and help protect, unstructured data in organizations.

15:34 The company, the investments in the company was earlier on this year, but the company's growth has accelerated rapidly and has a number of major contracts now with organizations across financial services, manufacturing, and also, quite importantly, contractors for the Department of Defense or the DOD in The USA. And that's a that's a really fast growing emerging market where there's new regulations in The US that require contractors to the DOD to have a have a data security solution such as GetVisibility. So pure play AI security company doing extremely well.

16:20 NOVALEA is the leading artificial intelligence cybersecurity and assessment and protection platform for connected IoT medical devices. So a connected IoT medical device could be a connected pacemaker, could be connected insulin pump, or could be machinery within, within a hospital. And the challenge right now is that these devices are quite open to being hacked. And in a worst case scenario, a hacker and there's a lot more hacking now in the COVID nineteen environment. Worst case scenario, hacker could kill the patient if if they have connected pacemaker, for example. But that's not typically what a hacker is trying to do. They're trying to get onto a hospital network and put ransomware or or or cause other problems on a hospital network.

17:16 And this is a this is a critical problem. And so what NovoLea does is is help the manufacturers of medical devices to find and fix security issues in their devices prelaunch, and then it monitors the devices in real time for new security risks. And the the the company has sold to three of the top 10 med device manufacturers in the world, I I would look forward to further announcements there over the coming months. And they're also now engaging directly with hospitals as well. So, again, that company is doing extremely well as in a super high growth area. And then the last one to talk about on this page is Buy Me. And Buy Me is same day delivery of groceries using artificial intelligence.

18:07 And and this deal is a little unusual for us in that we completed, the initial round of investment in April of this year. And you would have seen a a an r and s from Piras just, I think, last week or the week before announcing that there's been a subsequent round of investment and an uplift in the valuation of the company within two months. And the reason for that is that, clearly, in a COVID nineteen environment, being able to do real time grocery delivery in partnership with major grocers, across The UK, is a great place to be. And, there's a there's a fabulous team there that's doing amazing work in this space.

18:54 So that's a quick overview of some of the AI companies. Some of the some some additional overviews of, Internet of Things companies include Avaya, Cameramatics, and Ambisense. And, again, the Internet of Things is an area that's rapidly growing. These companies all have tailwinds behind their back. Just

19:18 at a very high level, Wyatt is a leading IoT company for smart buildings, and they've recently brought out a whole series of hardware and software products to help people get back to work. So in terms of monitoring social distance and reporting on social distance and helping people access common areas and bathrooms and solve some of those very naughty and difficult problems of getting people back to work in enterprises. And they sell now both to large organizations and to facilities managers and also to REITs and the building owners themselves. And I think, you know, look out for a whole series of announcements there over the next few months.

20:07 Cameramatics is in the telematics space. So there's a very famous company called Fleetmatics, which was acquired by AT and T three years ago for for over $1,000,000,000. And what it did was put a little device into trucks and and fleets of trucks to help help monitor them. Well, Cameramatics is is kind of like the next version of that. So it's kind of like, telematics 2.0. And they do tracking and monitoring, but they also do a whole series of cameras inside the vehicle, whether that be an articulated lorry or a van or any kind of any kind of, vehicle that that fleet uses.

20:56 It also puts cameras on the outside, and it's got compliance software as well. And it's brought together a number of key technologies to create enormous values for fleet managers.

21:08 And and that company has rolled out very broadly across The UK. It's also rolled out across Ireland as well, and it's just got its first customer in The US, which is a very, very large customer. And, again, I'd look for, you know, a whole series of announcements from that company coming out over the rest of the year, but doing super well. And then Ambisense is an IoT green company. And Ambisense produced the first sensor, IoT sensor, for real time continuous monitoring of gas as industrial site industrial sites. And it's also, built out a really significant AI platform for the analysis of sensors, their own sensor plus other sensors, and for environmental monitoring.

22:02 The the company's growth path has been to build out in brownfield sites across The U UK, to support the support construction industry. It it I think Perez announced, about a month ago, I think, that he's won a major deal as part of the Lower Thames Crossing. But it's it's also its development path is into, the European Union, because the environmental, legislation is very strong there. So expect to see, over over the course of its growth and development further major contract wins in The UK, and then contract wins in the European Union as well.

22:48 And then moving into immersive technologies, I I think most people on the call are probably gonna be pretty familiar with Immersive VR education as it's a listed company. We IPO ed that company in March of March of twenty eighteen. It provides it does two things. It provides these edutainment experiences such as the Apollo eleven journey to the moon, which is still one of the most popular and downloaded pieces of virtual reality content

23:21 to date. But it also has a platform, and the platform's called Engage. And Engage is a leading education platform in virtual reality. And you might have seen an RNS from the company this morning on a new partnership in the education space, and you would have seen, two or three weeks ago, RNS' around their investment from HTC, and also their, their global distribution deal with HTC, which is exclusive in China and then nonexclusive in the rest of the world. So that that company, the company's value has gone up pretty substantially. And, as Nick mentioned earlier on, as a result of the value going up, we, sold our original stake in the business and have are are in the process of returning it to investors in Shore Valley, Perez being one of them.

24:23 And but we also retain quite a substantial number of shares in the company as well. And those, we retain we've made. And very pleased with progress of And War Ducks then is, an amazing game studio, amazing female founder, came out of Facebook called Nikki Lanin. Nikki ran, marketing for games in Facebook, essentially helping mobile games developers to scale using the Facebook platform. She left and created her own company called Vardox, which which we invested in.

25:13 The company's had some considerable success with VR titles and took in an investment from ourselves and EQT to build out, you know, what we loosely describe as kind of Pokemon GO. And you should anticipate, that coming to the market in early, early twenty twenty one. And, it's a mobile it's a mobile product that I think if you can if you can think about Pokemon GO and its success is a similar type mobile product and has, you know, obviously, that potential as well. So we're really excited about that company. You know, we're starting to see versions of that product internally at the moment. It's just amazing.

25:59 And you may have seen some press from the company a couple of months ago where Tim Cook, the CEO of Apple, went in to visit the company and actually tweeted out that he just told what they were doing was amazing, and the game was fantastic as well. So so I think stay tuned, and I hope everybody has an opportunity to play that game in the New Year. Admix is a a company I touched on earlier on. Effectively, it's a it's a marketplace for advertising for three d games. So whether that's three d games on mobile, on PC, on console, or AR and VR.

26:45 And that company is a very rapid going, growing company, and it's it it's it's got a programmatic monetization system. So what that means is, on one hand, it signs up publishers, game developers, for example, and they can use a a a an SDK or or API to automate the placement of ads in their video game. And on the other hand, then it signs up

27:16 major providers of advertising and major brands as well. But the programmatic element of it is, it's effectively connecting to, on the advertising side, exchanges like OAuth or Google for a supply of advertising, and then it automates, the delivery of advertising into those video games. So because there's no human intervention, because it's effectively a double sided market, That gives it massive, scalability. And the way we think about admix is

27:50 it's very, very similar to a company called GoMob in the mobile wave. So as mobile, we're kind of at the top of the s curve of mobile growth at the moment, and growth is moving into things like AR, VR, IoT, and AI. But in the growth phase of mobile, GoMob was a company that did similar for mobile advertising, and that company was acquired for by Google for $750,000,000. So we see AdMix as an analog to that, and, it's got just the same scalability as that company, and it's doing extremely well at the moment. And that's why it raised a kind of a scaling round led by force over mass, which we participated in very recently, which Pira has announced.

28:45 And then VividQ, touched on at the very start, Cambridge based company, super deep tech in, using holographic technology to help display augmented reality. And that's being used by, at the moment, by who's who of global companies to help build out augmented reality glasses and also heads up displays in the automotive sector, so in cars, for example. And the promise of vivid queue is that you can have a car where you your heads up display helps you see holograms in the real world. A classic example of this would be if you're using mapping software to give you turn by turn directions rather than seeing an arrow that says turn right in 30 meters on your dashboard or on your windshield, you actually see that arrow 30 meters in the distance at exactly the point you need to turn.

29:49 So this this technology has significant application in automotive and also in what are called heads up displays, things like Microsoft HoloLens or

30:00 augmented reality glasses technologies. The company's doing a lot of work with those companies next year, and we should start to see products come to the market towards the back end of next year. So I think in in terms of news on that company, that's one really where you'll start to see a lot of news next next year.

30:23 So that that's a quick overview of each of the companies. Now you can't really talk about investment at the moment without talking about how your investments are responding to COVID. And so this what you see in front of you here is a, on slide 11, is a matrix from Deal Room. And Deal Room are a very respected market research firm, and they've analyzed tech markets, and they have they've identified a number of quadrants. And simply, there's a green zone where companies in the green zone, and you can see online grocery delivery is one of those.

31:11 Those are companies that are actually getting a lift from COVID, that are actually doing better in a COVID environment. There's a gray zone, and that's where comp it's kinda like the neutral zone. Companies are neither affected nor unaffected by COVID. It's just kinda business as usual. There's a yellow or orange zone where companies in this sector are impacted. For example, real estate, or some types of ecommerce, although ecommerce at large is doing well. And then there's a red zone, which is kind of like the disaster zone for tech, and that's things like Uber or Airbnb, so ride hailing, for example.

31:56 And so what we did

31:59 is we we've analyzed our portfolio in a number of ways, but one of the key ways was to map our portfolio to this matrix to identify which companies are affected in what ways by COVID. And the net result is actually very positive, and you should you'll be able to see that on slide 12. So by and large, most of our companies are actually growing and accelerating their growth as a result of COVID. There are some companies you see down on the bottom right that are unaffected by COVID. That was just business as usual. And there is one company then that's partially affected by by COVID.

32:45 So the the question one might ask is why are these companies accelerating in a COVID environment? Well, there's really three broad stories here. The first one is immersive technologies. So companies like ADMIX or VR Education or WarDocs, pretty much all immersive technology companies are getting a boost from COVID. And you see that in in in things like, there's been a series of reports out that are showing that people are playing much more video games, and also video streaming is doing very well also. And so you see companies like AdMix, what advertising there is. Advertising overall is is kinda going down a little bit. But when you look into the sectors, what you actually see is that advertising is moving towards gaming. And gaming is a high growth sector in in in in advertising, and admix is at the center of that.

33:43 People are also doing far more virtual reality and also augmented reality as well. So those companies have all benefited. If you look at GetVisibility and Novalea, unfortunately, in a COVID nineteen environment, security threats have gone up. So there has been a substantial increase in security threats both from nonstate actors, so criminal gangs, for example, and also state actors. And and you would have seen that, for example, in particular with Australia. But most companies, most large companies in Europe and and The US, there's some sort of security threat on those almost every single day these days alongside, the government as well.

34:30 And so security security is particularly important in the COVID nineteen environment. And the the the security companies have done very well also. And then Buy Me is in that kind of real time grocery delivery sector, and that's had a massive tailwind behind its back as a result of COVID as well. And just to answer one question that that some some of you may have, you know, so what's what's different about Buy Me, to, let's say, Tesco's standard delivery processes? What Buy Me can do is it can deliver to your door, many times in up to one hour. So it's kinda like real time delivery of groceries that's optimized via AI.

35:18 In the kinda neutral zone, if you think back to, my comments about vivid queue, it's kinda business as usual for vivid queue. They're working with a whole series of companies whilst AOR has gotten the push. Their products aren't really going to be out on the market until next year. So it's business as usual. It's probably arguable now that actually why it is no longer in the neutral zone. It's in the green zone because it's got, it's been overwhelmed with deals to, help people get back to work. And then Cameramatics, which is a telematics company, there has been some impact on that because, whilst it is supplying technologies to the fleets that are helping keep, the logistics supply chains going for things like, groceries, it it it has also been supplying to the construction sector as well. And construction sector has taken a bit of a dip.

36:19 But what we are actually seeing with that company is, it it had a dip in April, but it's it's actually starting to come back very, very quickly. So we think there's gonna be minimal impact on that as well. So overall, in summary, the portfolio has been very resilient to COVID. And actually, in most cases, the companies have got, an added tailwind from COVID and are growing and supporting users either, you know, in in terms of, video games or an AR and VR or, for example, in really essential service, like keeping logistics supply chains going or through the delivery of groceries as well. So that's it as a at a at a high level on the companies. I'll hand back to Nick now, and and he'll he'll tell you more information about Piris.

37:14 Yeah. Thank you very much, Barry. So just to really in in summary before we we go over to questions, you know, Piraeus is a is an investment company, you know, very much focused on investing in this next generation technology, and it's a great way for investors to get exposure to that sort of technology at a very early stage. We're very much focused on the sort of the the cutting edge sectors within the technology sector, so artificial intelligence, machine learning, cybersecurity, etcetera. And we we have access to incredible sector expertise with with with Barry and his team, and we're sitting here today with a really exciting portfolio of companies with with some fantastic potential.

38:04 And to date, we've been able to demonstrate that we can make returns from this investment being achieved two realizations, I. Cash realizations within a matter of matter of months. And going forward, you know, we very much think the company is very well positioned to implement this this investment strategy, really both from a financial standpoint and from investment opportunity perspective. Thank you. Thank you, Nick, and thank you, Barry. Ladies and gentlemen, please do continue to submit your questions, of course, using the Q and A tab on the right hand corner of your screen. But just wanted the company to take a few moments to review investor questions submitted already. And along, obviously, we're going to address those that were pre submitted. I'd just like to remind you that a recording of this presentation, along with a copy of slides and the published Q and A, will be accessible via your Investor Meet company dashboard.

39:00 I'd also like to remind you that your feedback is important to the company. And immediately after the presentation has ended, you'll be redirected for the opportunity to provide feedback in order that the company can better understand your views and expectations. Barry, Nick, I thought, obviously, investors had the opportunity to pre submit questions, and we had a number that was sent through. And of course, we can then move on to those that have been submitted during the live event itself. So perhaps if I start off with the first question that we received was, will you be looking at adding to the board with someone who is focused on the tech sector, maybe someone who is working with SVV, Shore Valley Ventures? Yeah. So let me answer that. So as I said said earlier, we we can already access significant amount of technology investing expertise through through Barry and his team.

40:00 But clearly, you know, if if we we review things on a regular basis and and we may well add to the team team periods as and when appropriate. Thank you. A follow on question. Are you paying advisory fees to Shore Valley Ventures for their for the direct investments? No. We don't do not pay any fees to Shore Valley Ventures for this type of investment. Thank you very much. Another pre submitted question. With regards to shareholder value, would the company issue a special dividend if one of the companies in the Shore Value Venture Fund was sold for a significant amount of money? So on that, I mean, as a company, we, you know, review dividend policy on a regular basis. And I think at the moment, you know, we're very much focused on deploying our investment funds.

40:48 But that's not to say that, you know, going forward if the right situation arose, we would look at some form of dividend. Thank you very much. The next question, and we've got about another three or four that were pre submitted. When will the company be selling its legacy investments? Is there a target point? Well, as we previously announced, our sort of non tech investments now are pretty small percentage of our overall portfolio. So, you know, we will look to realize those really as and when appropriate. But as I say, it's a it's a it's a very small portion now. Thank you very much. Next question, as I say, that came in pre event is, is it an option to invest and take up a significant share of a company through issuing shares?

41:43 Yeah. And I think that question is really, you know, can we make an investment or pay for an investment through the issue of shares in periods as opposed to using cash. And the answer to that is yes, if that's what we think is appropriate at the time. Thank you. Perhaps, Barry, I think there's probably a question here that we can address to you, if that's okay. How much more money have Shore Valley Ventures investors committed to provide? Over what time scale? And how is this likely to be spread between follow on funding for existing portfolio companies versus backing new opportunities? No. That's a that's a very good question. I mean, that that goes to the core of our strategy for or or investment strategy and how we do investments.

42:31 So maybe just to step back a little bit on this because we we spoke about the sectors that we invest in, ARVR, you know, immersive technologies in general, IoT, AI, and security. But what we've not spoken a lot about is, well, how do we go about that, and what's our strategy? So our strategy is to get in at an early stage. Now that early stage is often called different things in different jurisdictions. So, for example, it would be called seed in The US, but in in The UK, that's often seen the stage we invest as kind of early series a. And maybe the best way to think about that is what we're looking for in a company that we invest in.

43:16 So we're looking for a great team that's got experience in the industry that they're selling to. We're looking for a product and a groundbreaking product at that that's defensible and has got some deep IP. We're looking for that product to be in the market and for the company to have market validation, which is initial key customers. And so what we then do is look to put together a round of investment for the company that will help them get to over about a a sixteen to eighteen month period, typically to about £1,000,000 plus in annual recurring revenue. Now the metrics can be slightly different for different companies, but that that's at a high level where we wanna get them to. And so that's quite a fast acceleration.

44:09 And then at that point, the we will do another investment round and bring in other investors to price the round, for example. So just coming back to that again, in the first round, typically, we'll lead, although not in all cases. In Buy Me, Buy Me was a deal where where a range of of venture capital, investors came together to invest in Buy Me. But in the majority of our deals, we lead, and then we will often bring in some coinvestors, including, investors in the fund, and also investors that we coinvest with on a regular basis. And, typically, we're looking to put together around of about £2,000,000, to help the company scale to that ARR of £1,000,000.

45:02 And then at the next round, we'll typically bring in a new VC to price the round. So a good example of that would be with. We brought EQT in, who are an extremely well known private venture capital investor, and they priced the round, invested, and then we followed on to maintain our pro rata or our percentage in the business. And that's probably a good example of our strategy, such as so lead the first first scaling round, follow on at subsequent rounds. And that brings me to our kind of what's what's often referred to as our dry powder ratio, which is for for we typically reserve two times the capital that we do in our first investment for follow on. And the goal being to get in at an early stage at attractive valuations, typically to get between 10 to 20% preferred equity ownership in the business and then follow on at subsequent rounds to maintain our percentage.

46:11 One other thing I should mention in terms of preferred equity, for market or for public market investors that that that you often see that term, but it means a different thing. So in in the private VC investment world, the way we invest is preferred equity is, it's an equity investment, but with substantial protection rights for, Shore Valley and thus for periods. So we would go on the board of the company. We'd be very active in helping develop the company. We also have, substantial protections or reserve matters. So the company can't issue new equity without our consent or raise debt without our consent, and uphold or restructure the business in any way or sell the business.

47:04 So so when we when we invest in the business, you know, we're really it's very different, the style of investment, to investing in, let's say, immersive VR education on the market where it's all ordinary shares and the investors the, you know, the the the investors get a different set of rights to the rights we would have as a as a private VC investor. So I hope that helps explain a little bit more about the strategy. And I guess the key things I draw out of that are, you know, we get in early, but we're certainly but but not the earliest investor. You know, typically, companies we would have invested in, you might have seen angel investment or EIS investment from angels or accelerators.

47:49 We would come in when there's market validation, when there's a product in the market and their sales. We put together a round which we lead normally to invest in the company, give it eighteen to twenty four months runway to get to a million ARR, and then we do the next scaling round. And, typically, to get a company to exit, you would have two or three rounds. There are exceptions. Automatics was an exception. We we exited during the first round. But, normally, you would see things like admix where there's a second round, and a sale could occur post the second round or post the third round. That that would be more common. So I hope that helps. Thank you very much. Sorry about that.

48:39 I think to wrap up on the pre submitted questions with an interesting one, and this is to each Nick and Barry. Which investee companies are you most excited about and why? Okay. Should I go first then? For me, I mean, they're all exciting companies, but I think for me, the one I really like is get visibility. And the reason for that is, you know, the market that it's addressing is so enormous. You know, as Barry mentioned, you know, already so much of an organization's data is in this sort of unstructured form that needs to be, you know, sorted out, protected, organized, etcetera. So I I just see that company as having, you know, fantastic potential for growth.

49:28 And, you know, even even a couple of the sort of comparables that you could look at that that are in the same space are sort of, you know, multimillion pound companies. So, you know, I think there's a lot of potential to get visibility. Thank you. Barry, to you. Thanks, Mark. You know, that's a really, really difficult question because it's it's kind of like, which which of your children do you love more? You know? It's very difficult to answer that question. The maybe maybe if I could just touch on a couple of companies, really. So I I think NOVALEA is one of my favorites because it's just the clear leader in that space. And if you're a hospital or a medical device manufacturer, this is this is the company that you think of first when you look to secure your hospital network or your medical device.

50:23 And so the the again, the the market potential is absolutely massive on that company. The another one I'd probably highlight is, you know, is WarDucks. That's a company where there's not a lot of news on it right now. But when we get into the first half of next year, I think, you know, that that does genuinely have the potential to be the next Pokemon GO. And Pokemon GO is is is a game that most people think has kinda been a bit of a fad and has died out, But it made billions in its first year, and it still continued to make billions in revenue last year and also this year as well. So it's one that's kind of maybe gone out of the public consciousness, but it's still still got tens of millions of users and is making billions.

51:14 And so I think that's the potential of of WarDucks. But maybe to to to if I had to choose a favors, it would be very narrowly, I would say, because because because I I love them all. I would pick admix. And the reason I would pick admix is because they're they're I think they're very much in the right place at the right time. There's you you might have even seen over the last couple of weeks, advertisers are pulling away from social media. And and you might also have seen advertising is moving into video games, and particularly three d video games and AR and VR is just a great space to be.

51:59 And they are the clear programmatic leader in this space and have massive scalability. And so I think that company is a very, very exciting company. And and very difficult to choose between them all, but that that would probably edge out some of the others just in terms of the potential growth we we can be seeing over the next twelve to eighteen months. Thank you, Barry. Obviously, I'm pretty mindful of time guys as well probably an unfair question to throw on you at the last one, but that's what investors put through. And of course, thank you very much for asking that. Nick, obviously, there's been a number of questions that have been submitted during the event. And of course, I think perhaps you may have addressed some of these through both the presentation and those pre submitted questions. So to investors whose questions aren't answered during the live event, that is perhaps an explanation.

52:53 And we will obviously publish all the Q and A alongside the presentation and the slides after the event. Barry, perhaps if you just want to and Nick, if you just want to have a look at those questions. If I could ask you just to read out the question should you wish to then give your response, that would be very kind. And then we'll probably look up to wrap up in the next few minutes. Okay. I mean, I'll read out the first question. But, Barry, I think that's probably one one for you. But if I I read it out, this is from Jake D. What steps does the company take to mitigate the dependence of key directors, particularly given the relationship with invest with invested companies? And I'm assuming that's really focused on the on the sort of key directors in the investee companies.

53:41 Oh, right. Well, one of the key things we focus on and, Nick, tell me if if if you think I'm not answering this question correctly or I'm not addressing the core of the question. One of one of the things we focus on is team. So we we focus on team, product, market, and scaling opportunity. But day one, when we go in, we we do simple things like we get insurance in for the team, but we also work with the core founders to actually build out that team so that, you know, for for example, in a COVID nineteen environment, if somebody got sick, that they've got coverage in the business. We also look to in terms of the board of the company, we have a strategy for building out the directorships and the board of the of the company as we go through the rounds.

54:34 And the other thing we look to do is, as as these are often early stage businesses, when we go in as an early stage in these businesses, we put in place, you know, proper corporate governance as well. But I think team is team's important. We we we never invest in single founders. There always has to be a team of founders, and job number one is to is to build out that team. And in fact, if you think, we one thing we've not touched on here is, we we have this concept of platform, and platform is really the value add that we deliver to companies. And we deliver value add in a whole variety of ways. I mean, we've got, we've got over 30 now portfolio advisers. We've got a portfolio advisory board with 30 people from across the world. So, for example, we have, you know, the head of entrepreneurship in and VC in London Business School, all the way to, you know, keeper in m and a in Apple in New York as part of that advisory board, and they advise the companies.

55:43 And we support the companies through the group through the key milestones they need to hit to grow, but we also support them with internal resources as well. So building out the team, building out internal systems, getting the sales engine going, so all of the key resources that need to be built in companies as well. So it's that that's job number one when when we get in there day one. So, hopefully, that answers the question. Yeah. No. I think that I think that does. Mark, we got time for one more question, do you think? Or Yeah. That that would be great. And then, obviously, we know that you want investor feedback, so we'll we'll drive straight through onto that. So perhaps that would be great. And, obviously, all the other questions investors have submitted, you can review. And as I say, we'll publish those answers back to everybody.

56:31 Okay. Let me just pick one one other company, which is from Nicholas c, which is, are we likely to see any investments from periods which are unconnected with Shore Valley Ventures? And if so, what areas are being considered? Okay. Well, I can answer that. And the answer to that question is very it very much so. Yes. You know, we we sort of decided to initially get into technology by way of going through a fund and getting a ready made portfolio of companies. But our sort of strategy is very much to invest in, you know, in the whole area of technology. So there are gonna be lots of areas that we would do within that space that wouldn't be connected with your value ventures.

57:18 Perfect. Thank you very much, Nicholas. And obviously, you, Barry, for updating investors today and for giving an overview of the investee companies. Obviously, all these questions that we haven't managed to get through in Q and A, the company will review them, and we will publish responses where it is appropriate to do so, and investors will be notified when that is ready for them to review. So thank you once again. Could I ask investors not to close the session as you'll be automatically redirected for the opportunity to provide feedback? If you access this presentation from our website, the feedback page will appear. However, if you accessed it via the email link, you'll be asked to log in to simply submit your feedback. And we do very much encourage that to help the company shape future presentations moving forward. So on behalf of the company and Investor Me company, I'd like to thank you for attending today.

58:13 That now concludes today's presentation. Thank you once again.