Portfolio Update Q3 2020

RNS Number : 7477E

Sure Ventures PLC

10 November 2020

 

Sure Ventures plc ('Sure Ventures' or 'the Company')

Portfolio Update Q3 2020 period

Sure Ventures plc is a London listed venture capital fund which invests in early stage software companies in the rapidly growing technology areas of augmented reality ('AR'), virtual reality ('VR'), Internet of Things ('IoT') and Artificial Intelligence (AI). We are pleased to provide an update on the Company's investment portfolio.

SURE VALLEY VENTURES FUND

Sure Ventures made a € 7million commitment to Sure Valley Ventures Fund ('Sure Valley') representing an interest in Sure Valley of approximately 25.9%.  This commitment was made at a price of €1.00 per share. The current NAV of the Sure Valley Ventures ICAV is 1.004 Euros.

Sure Valley has several investments across the AI, AR, VR and IoT sectors:

VR Education Holdings - http://immersivevreducation.com/

HTC are now a major Shareholder in the VRE and this validation has helped gain break through contracts since 30 June 2020, particularly in the US market, with sales of the ENGAGE platform for training and remote distance learning purposes to a number of organisations including Facebook, The United States Air Force Academy, University of Arizona, Colorado State University, SNCF, Lobaki, Houston Community College and Stanford University.

There has also been Engage contracts signed in Japan and China via its HTC global sales relationship. The board of VRE are pleased with the progress made and put the accelerated adoption down to COVID19 and the benefits Engage offers Educators and Businesses alike in the working from home environment.

WarDucks - www.warducks.com

The company has six bestselling titles under its belt, the latest two of which were Top Ten on PlayStation VR. The company is building on its success to date and is now developing a major new AR mobile game that is in the same category as Pokemon Go. To achieve this the company has hired well known and renowned game developers from the US and brought them to Dublin and also brought on the famous game designer John Romero in to help design the new product. John Romero, cofounder of BAFTA award-winning Romero Games studio and winner of over 100 awards, will work as a Creative Consultant.

To enable the company take this product to the market it completed a series A round of €3.284 million in Q1 2019, with new investors EQT investing €2.58 million, Sure Valley following on to maintain its percentage with €453,858.32 and existing investors making up the remaining investment. The transaction completed on the 29th of March 2019. The latest product is in Alpha. Sure Valley originated and invested €300,043 this company at pre-money valuation of €2.5 million and followed on with an investment of €453,858.32 at a pre-money valuation of €10,000,000. As a result, Sure Valley holds 10.10% of the company on a fully diluted basis. The company recently hosted a visit in their offices from Tim Cook, CEO of Apple to meet the team and view the game. Tim gave team a public endorsement shortly afterwards.

 Wia - www.wia.io

WIA https://www.wia.io/ is an Internet of Things (IoT) company with a ground-breaking cloud platform https://www.wia.io/product, enabling developers to turn any type of sensor device into a secure, smart and useful application in a matter of minutes. This generates considerable time and cost savings for teams who would have previously had to spend many months on 100,000's of lines of code to try to build out their own IoT cloud infrastructure.

During the Covid lockdown the company has focused on developing IoT Tech to help businesses return to the workplace safely. In June Wia released the next iteration of the Wia Cloud. The new Wia Cloud is designed to help businesses understand and monitor their building, making it a powerful tool in the effort to return to the workplace. The service focuses on:

· Occupancy and Space Utilisation

· Energy Utilisation

· Regulation Compliance

As part of this platform Wia created their own DFS-1 directional motion sensor. The Wia DFS-1 is a whole new way to measure the in-flow and out-flow of people to create safer, greener and more human-centric buildings. The Wia DFS-1 has been deployed at a number of customer sites including Hubspot and Irish Distillers in Dublin.

Cameramatics - www.cameramatics.com

Cameramatics is the leader in Camera and software solutions for commercial fleets, Cameramatics delivers products that allow fleet managers to reduce fleet risk, increase driver safety and comply with growing governance and compliance regulations.

Pre Covid-19 the company was performing exceptionally well and to support the company grow rapidly Sure Valley invested a further €750,000 in convertible debt (€250,000 in Q1 2019, €250,000 in Q2, 2019 and €250,000 in Q4, 2019) and Enterprise Ireland invested €250,000 in Q3, 2019. This quarter Covid-19 has led to a short-term drop in revenues as logistics and delivery businesses were closed or inactive. Despite this the management team have done an excellent job of managing cash.

The requirement for logistics, home delivery and efficient fleet management during the COVID19 situation has accelerated sales since April and the business is performing well both in the UK and Ireland, with some attractive US contracts to come. The Company is in the process of closing its Series A funding and we look forward to sharing that news with Investors soon.  

NDRC Arc Labs - http://www.arclabs.ie/

The NDRC@ArcLabs investment was structured as a subscription as a limited Partner to the Accelerator. The purpose of the Accelerator is source and develop 30 start-ups over two years that Sure Valley has the right to invest in. The Accelerator is running three calls for 10 start-ups over 3 years in areas that are related to the fund's investment strategy of AR/VR, IoT and AI. As a result of the Accelerator's programme significantly overlapping with the Fund's investment areas we see this Accelerator being a source of proprietary deal flow. The fund is investing €300,000 over three calls and so far two of these calls have been made. The third call has been made and the third cohort is currently at its midway point in the NDRC programme.

Nova Leah

Nova Leah is the leader in cyber security for connected medical devices and is an IoT investment by Sure Valley Ventures. Nova Leah sells directly to the top medical device manufactures typically in Boston, MA and the west coast of the USA. The founder, Anita Finnegan, is an expert in the area and originally built the technology in a top medical device software research group in DKIT, while doing a PhD, and later she spun out the technology and developed the market selling to a number of tier 1 medical device manufacturers.

Sure Valley Ventures invested €750,000 in the company for 10.62% of the company fully diluted. Subsequent to our investment which closed on the 5th of October 2018 the company was successful in the Irish government Disruptive Technology Fund (DTIF) programme for €1.5 million.

The company is making good progress on its ARR and is in the final stages of completing a deal with Medtronic which will bring its ARR close to the €1m mark to support the company towards a Series A raise, which is planned to start in early 2021.

Admix Ltd  

Admix is an advertising platform for AR/VR developers. The company is based in London and is led by Samuel Huber as CEO, Joe Bachle-Morris as COO and Mark Rich as CTO. Technically Admix has developed what is called a Supply-Side Platform (SSP) which enables developers to monetize their content by creating, managing and sell advertising inventory.

Admix enables, for the first time, VR/AR inventory to become immediately available to thousands of advertisers connected to the existing ecosystem, which provides VR/AR developers with instant revenue. Admix does this by establishing connections to major Demand-Side Platforms (DSP) such as Pubmatic who then in turn connect to Advertisers.

Sure Valley invested $500,000 at a pre-money of $5,000,000 for a shareholding of 7% fully diluted in the business, with a right in the investment docs to get to 10% at the next round should Sure Valley choose to. The deal closed on the 21st of November 2018. Admix is seeing revenue growth of 50% month on month across the last quarter; by year end annual run rate is forecast to be $1.5M.

The 'Fill rate' a key metric hit a high of 16.6% in Q2 20. To support its growth the company completed a Series A round on the 31st of March, raising $6.25 million with a pre-money valuation of $22,500,000 million, a substantial uplift on our original investment. The investment round was led by Force over Mass investing $4m with participation from Speedinvest investing $450k and SVV investing $535k.

 VividQ Ltd

 VividQ is a deep tech software company with world-leading expertise in 3D holography. The company was founded in 2017 by a team of expert engineers, mathematicians and computer scientists from the Universities of Cambridge, Oxford and St Andrews, who solved key technology barriers in the adoption of holographic display.

Holography has long been considered the ultimate display technology. The science fiction ideal of engineering and manipulating light to produce 3D projections appealed to the imagination of millions through franchises such as Star Wars or Star Trek. While physically possible, the tremendous computing requirements to create full-depth holographic display made it unreachable for commercial applications.

VividQ continue to partner with some of the leading chip manufacturers, hardware developers and users of holographic display. The company announced a partnership with ARM Holdings in the last quarter and signed its first major contract with a Chinese and Hong Kong based car manufacturer.

Ambisence  

Ambisense's Ambisense's Ambilytics™ platform optimises the delivery of environmental risk assessment on some of the world's largest infrastructure projects across industrial, Oil & Gas and Waste Management verticals, partnering with global multinationals such as CEMEX, SGS & Arcadis. Ambilytics™ encompasses both IoT and AI solutions, combining information from remotely deployed field devices with contextual data sources such as weather, satellite, geophysical and operational data to build machine learning models. These models identify the relationships, patterns, and drivers hidden within the data and allow customers to forecast and predict the behaviour of targeted environmental pollutants.

Since completing our investment, Ambisense have identified increasingly significant government backed infrastructure projects which via tender process, the Company have been successful in winning. In two particular use cases, the contractors concerned feared that the technology they required 'didn't exist in the market', but such is the power behind Ambylitics and the ability of the Company to design effective and bespoke monitoring models, the Company has been successful in winning these multi-year, recurring revenue contracts.

The Company successfully operates on a break-even basis, despite Covid-19 related issues. In fact, it has been successful in winning new contracts due to their ability to solve for IOT monitoring models, whatever the circumstances.

GetVisibility

Visibility Blockchain Limited trading as Getvisibility was established on the 31st August 2017 by Ronan Murphy and Mark Brosnan. The company has developed and launched a software platform called Getvisibility targeting this data security sector. This software delivers visibility over unstructured data, e.g. Word documents or pdfs, for enterprises, by automatically, accurately and precisely scanning and classifying the data to a corporate taxonomy using artificial intelligence (AI) at scale (NLP and Neural Networks).

On 7 August 2020, Getvisibility announced that it had signed a public sector distribution agreement with immixGroup, the leading value-added distributor of enterprise IT for the U.S. public sector. The agreement will allow Getvisibility to grow its public sector business, accelerate sales cycles, and operate more efficiently in the government market. Federal agencies will also be able to deploy Getvisibility products on-premises and into their existing cloud infrastructure.

GetVisibility is experiencing emerging interest to provide a solution for EUC audit compliance which could represent a substantial market vertical. Inbound interest has been expressed by Accenture, KPMG, PWC and Grant Thornton

Buymie Technologies

Buymie is an on-demand grocery service, currently available in Dublin, Ireland and Bristol, UK. An individual can order goods from a selection of local stores such as Tesco and Lidl in Ireland and the Co-op and Asda in the UK via the Buymie app and have them delivered by a personal shopper in as little as 1 hour. Delivery charges from €3.99 (free for orders over €100), up to 30% cheaper than visiting a traditional convenience store. More convenient than traditional eCommerce platforms reducing the environmental impact of grocery shopping.

Sure Valley Ventures initially invested in Buymie's Seed round in March 2020, investing €300,000 at a premoney valuation of €8,000,000 giving SVV a fully diluted equity position of 3%. The seed round was led by ACT Venture capital with participation from Haatch Ventures, BVP Ventures, HBAN and Enterprise Ireland.

Sure Valley subsequently participated in Buymie's Series A round which was completed in June 2020. The total amount of capital raised was €5,400,000 and was led by Wheatsheaf group, the investment arm of the Grosvenor estate. The pre-money valuation was €15,000,000. SVV invested €510,000 and has a fully diluted equity position of 5.05%.

Buymie have now partnered with Co-op, Lidl, Dunnes and are in talks with other major UK and Irish Supermarket chains. The COVID19 environment is accelerating the growth of Buymie and the pace of its expansion continues in an aggressive manner.

Volograms Limited

Volograms is an Augmented Reality (AR) capture and volumetric video company. Volograms' technology enables users to capture volumetric holograms (or volograms) of real people. By inserting the 'Volograms' into videos, people can create their own immersive Augmented Reality (AR) and Virtual Reality (VR) content for use in apps, social media and VR headsets.

The mobile AR market is forecast to grow from the one billion compatible devices and over $8 billion in revenue in 2019 to 2.5 billion compatible devices and $60 billion in revenue by 2024. The Volograms mobile product will enable mobile phone users to take AR pictures and videos, then view, edit and share them with others. This can be done directly or through social media platforms.

We believe that Volograms is opening a new market category for AR photos and video. This category should have much greater appeal for content creators and social media users than the existing static 3D content solutions on offer. Central to the company's future success is (i) its OEM strategy (ii) consumers then adopting the technology. Given this, the SVV deal team agreed with the company that they would bring in some additional people with experience of an OEM strategy and mobile consumer products. If successful Volograms has the potential to be massively scalable and potentially usher in the rapid expansion of the mobile AR industry.

DIRECT INVESTMENTS

 Investments made directly by Sure Ventures plc:

Immotion PLC ('Immotion'), is a UK based company that creates its own high-quality VR content and enhances the immersive experience by coupling this content with motion simulation.

In February 2020 the company released a trading update stating that they had deployed above 460 contracted headsets in high footfall tourist attractions globally. This figure represented the estimated number of headsets required to reach breakeven and sales momentum was progressing at a strong pace.

The nature of Immotion's business meant that COVID 19 and lockdown restrictions reduced their revenues dramatically. The footfall at sites across the globe ground to a halt. The Management team have done a good job of reducing costs and using the various Governmental schemes available to keep the business funded.

The Mandalay Hotel site and numerous others have now re-opened and a recovery is now beginning. To assist with making consumers confident with using the VR headsets Immotion  begin adding an Ultraviolet light COVID cleaning system to their sites. The uptake was encouraging and they are now selling these units commercially as a stand alone device.  

VividQ

Sure Ventures PLC has a further direct investment of £500,000 in VividQ, on top of its 25.9% exposure via its holding in Sure Valley Ventures ICAV. The progress being made, the tie ups with major global technology players and the pathway of holography adoption being laid out provides a great deal of promise for the future.

 Sure Ventures Director, Gareth Burchell said, "Given the current Economic conditions and the continued global governmental reaction to the Coronavirus pandemic we are pleased with the progress made by our portfolio companies. The new Investment made in Volograms, the follow on in Buymie and the performance of the portfolio companies excites me, the board and hopefully investors.

We have had a small drop in our NAV over the last quarter, largely due to the drop in VR Education's share price quarter on quarter. VR Education has made significant progress since, along with a number of exciting developments withing the portfolio constituents. We look forward to both Q4 this year and Q1 2021 driving growth for Shareholders"  

For further information, please visit www.sureventuresplc.com or contact:

Gareth Burchell	Sure Ventures plc	[phone]

Notes to Editors

Sure Ventures plc listed on the London Stock Exchange in January 2018 giving retail investors access to an asset class that is usually dominated by private venture capital funds.  Sure Ventures is focusing on companies in the UK, Republic of Ireland and other European countries, making seed and series A investments in companies with first rate management teams, products which benefit from market validation with target revenue run rates of at least £400,000 over the next 12 months.  Website: https://www.sureventuresplc.com/  

 

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