The British Innovation Fund Investing in the Best of UK University Venturing
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The British Innovation Fund Investing in the Best of UK University Venturing For discussion purposes with Professional Investors only 2Q 2020 BRITISH INNOVATION FUND EXECUTIVE SUMMARY Key Areas of Specialty: Agricultural Bio- Technologies technology The BIF has been backed by some of The BIF is managed in the leading local The British Innovation partnership with government pension Deep Tech Life Sciences Milltrust International LLP Fund (BIF) is an schemes in the and Milltrust Agricultural AIFMD-compliant United Kingdom patient capital venture Investments, and supported by an capital fund investing in cutting edge spin- Alternative Advisory team of Nano Tech investment specialists outs emanating from Protein and agricultural and leading UK university research. scientific experts. 2 INVESTMENT PREMISE “Exploration is the engine that drives innovation. Innovation drives economic growth.” - Edith Widder 3 INVESTMENT PREMISE A BRIEF HISTORY OF BRITISH INNOVATION Sir Isaac Newton, PRS 25 December 1642 – 20 March 1726 Sir Alexander Fleming, FRS FRSE FRCS English mathematician, physicist, astronomer, 6 August 1881 – 11 March 1955 theologian, and author widely recognised as one of the Scottish biologist, physician, micro-biologist, most influential scientists of all time and as a key figure and pharmacologist. Inventor of Penicillin. in the scientific revolution. Edward Jenner, FRS FRCPE FLS John Logie Baird, FRSE 17 May 1749 – 26 January 1823 13 August 1888 – 14 June 1946 English physician who was a contributor to the Scottish engineer and innovator. One of the inventors of development of the smallpox vaccine. the mechanical television. Michael Faraday, FRS 22 September 1791 – 25 August 1867 John Adrian Shepherd-Barron, OBE English scientist who contributed to the study 23 June 1925 – 15 May 2010 of electromagnetism and electrochemistry. Main British inventor who led the team that installed the discoveries include the principles of first ATM cash machine. underlying Electromagnetic induction, diamagnetism and electrolysis. Charles Babbage, KH FRS Stephen William Hawkins 26 December 1791 – 18 October 1871 8 January 1942 – 14 March 2018 English polymath. A mathematician, philosopher, English theoretical physicist, cosmologist, inventor and mechanical engineer, Babbage originated and author who was director of research at the Centre the concept of a digital programmable computer. for Theoretical Cosmology at the University of Cambridge. Charles Robert Darwin, FRS FRGS FLS FZS Sir Timothy John Berners-Lee 12 February 1809 – 19 April 1882 8 June 1955 - Present English naturalist, geologist and biologist, best known for English engineer and computer scientist. Inventor of his contributions to the science of evolution. the World Wide Web. Source: Wikipedia 4 INVESTMENT PREMISE MEET THE KEY MINDS BEHIND OUR PORTFOLIO Scott White, Founder & CEO of PragmatIC, invented and now A world beating set of mass-production of early stage investments nano RFID from the top scientists at Partnering the UK’s communicators which Andrew Shaw, Founder one of the world’s leading animal track products through & CEO of Attomarker greatest universities research institute to their life cycle and Associate Professor improve the food of Physical Chemistry, chain, enhance animal University of Exeter, at welfare and pioneer the forefront of the UK’s alternative proteins fight against COVID-19 with rapid antibody test 5 INVESTMENT PREMISE WHY UK UNIVERSITIES THE KEY RATIONALE FOR THE BRITISH INNOVATION FUND (“BIF”) Key statistics UK universities struggle to raise capital to commercialise world class UK universities in top research versus US counterparts despite pioneering science and 10 of global rankings groundbreaking innovations 4 (Oxford; Cambridge; 1 UCL; and Imperial ) BIF provides capital to support early stage spin-out companies through investment via: UK universities in top • University commercialisation companies and university 18 100 of global rankings1 incubators; or • Directly into spin-outs. Spin-out and staff 4,052 start-ups created from Spin-outs must have a viable commercial business and generate 2 universities in the UK revenue Source: 1QS World University Rankings 2020; and Higher Education Business; Advanced ideas reside in academia – incubators search these out 2Community Interaction (HEBCI) surveys 2002/03 - 2017/18 and come to us for acceleration funding once proven 6 ABOUT US “A dream will not become an innovation if there is no realization.” - Ciputra 7 ABOUT US INVESTMENT MANAGER MILLTRUST INTERNATIONAL 3,600+ Stocks held Selection of Milltrust is a UK and across six continents Recent Awards: Singapore-based investment group founded Milltrust is the provider 20 Industry awards in 2010 by an experienced and investment manager team of institutional of a range of sustainable #1 Ranked investors and focused on institutional investment Global EMerging Markets sustainable impact solutions focused on equity strategy investing. The firm is Global Emerging Markets, 10,000+ Hectares of regulated by the FCA (UK). Agriculture Investments, diversified land Science, technology & under cultivation innovation, and Climate Change investments. 19 Investment manager partnerships 8 ABOUT US INVESTMENT ADVISER MILLTRUST AGRICULTURAL INVESTMENTS LTD Milltrust Agricultural The Farmland funds are The British Innovation Fund The investment team Investments (“MAI”) focused on agricultural (“BIF”) invests in university has an average of 20 serves as the adviser to investments in the commercialisation years’ investment the MAI Australia and southern hemisphere. companies, incubators and management New Zealand Buy & Lease spin-out companies experience. Farmland Funds, and to The funds aim to provide emanating from UK the British Innovation investors with an income universities. The investment team is Fund generating, inflation advised by investment adjusted, long duration The fund has specific specialists and investment that is lowly expertise within the areas of agricultural and correlated with other agricultural technologies, scientific experts. asset classes biotechnology, nano tech, deep tech and life sciences 9 ABOUT US HISTORY OF MAI AND THE BIF Milltrust Creation of BIF mandated for MAI founded in Led to greater in 2017; and capital raising 2015, followed focus on Agri- founding and agricultural by Australia and science within investor in acquisition New Zealand Milltrust and Roslin advice between farmland funds MAI Technologies 2011-2015 Recognition of wider opportunity to invest in science and technology - British Innovation Fund created to pursue these opportunities 10 STRATEGY “The high number of research universities in the UK means it has a long history of scientific discoveries that have become commercial successes.” - Financial Times, 16 February 2020 11 STRATEGY INVESTMENT UNIVERSE Scottish Universities UK University Clusters Aberdeen, Dundee, Edinburgh, Glasgow, St Andrews & Stirling N8 Research Partnership Durham, Lancaster, Leeds, Midlands Innovation Liverpool, Manchester, SETsquared Partnership Newcastle, Sheffield and York Aston, Birmingham, Cranfield, Golden Triangle Keele, Leicester, Loughborough, Nottingham and Warwick Bath, Bristol, Exeter, Southampton and Surrey Universities located in the cities of Cambridge, London and Powered by Bing Oxford© GeoNames, HERE, MSFT 12 STRATEGY KEY SECTORS Agricultural Technologies Deep Tech Biotechnology Life Sciences Nano-Technology Alternative Protein 13 STRATEGY PRIMARY ALIGNMENT TO THE UN SDGS 14 STRATEGY INVESTMENT PROCESS ORIGINATION Incubators and University University investment Investor network of angels Commercialisation networks and VCs Companies (“UCCs”) 15 STRATEGY INVESTMENT PROCESS RESEARCH AND IMPACT ASSESSMENT Characteristics: Targeted investment Due Diligence: rounds: Seed; Series A & B Research Output: Company visits, Identification of investment research reports and Target IRR of 20%, case, valuations, and risks. proprietary models. including dividend payments from portfolio companies and significant Impact Assessment capital appreciation and alignment with UN Sustainable Exit strategy: 5-8 years via Development Goals trade sale; sale to private equity; or IPO 16 STRATEGY INVESTMENT PROCESS PORTFOLIO MANAGEMENT Investment Proposals: Portfolio and Risk Investment proposals and Management: Quarterly Investment due diligence reports are Carried out on an Advisory Committee submitted to the ongoing basis by the (IAC) Meetings: investment manager for investment manager and BIF Funding Post- Presentation by short- further review, in formally reviewed during Initial Investment: listed companies to the consultation with the the fund’s quarterly Either supported by IAC’s industry AIFM and the fund’s Board meetings the BIF and / or specialists and other Board of Directors, marketed to our participating advisers. allowing numerous network of similar VC All investment checks and balances investors proposals require final throughout the sign-off by the IAC investment process 17 INVESTMENTS “Venture capital funding for UK tech firms reached £10.1bn in 2019, rising 44 per cent year on year and breaking the all-time high set two years earlier.” - City A.M., 15 January 2020 18 INVESTMENTS BIF PORTFOLIO Top 10 Holdings 1 Direct Investments Performance to Date3 #1 Attomarker UCCs and Incubators: 125 #2 Pragmatic Printing 5 business 120 #3 Evox Therapeutics2 units #4 2 115 Osler Diagnostics 78 spin- 2 #5 Oxford Nanoimaging outs 110 #6 Vaccitech2 Spin-outs: 105 #7 Diffblue2 100 #8 Ultromics2 #9 YASA Motors2