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Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
Bio nano elements of early stage valuation and value growth
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Bio nano elements of early stage valuation and value growth

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Bio nano elements of early stage valuation and value growth

Bio nano elements of early stage valuation and value growth

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  • 1. Elements of Early Stage Valuation and Value Growth Gene Scout Talk for NanoBioConvergence Mary D Napier 3/1/2014 May 17, 2006 mnapier@genescout.com 1
  • 2. What we do Discovery Science Translation Strategy Consulting Project Mgmt Business Development Portfolio Management Gene Scout advises along several aspects of technology Commercialization pending on the needs of the client. 3/1/2014 mnapier@genescout.com 2
  • 3. Translation • IP, literature and clinical trial scan in your company’s scientific area. • Define market positioning and economic value. • Market segmentation to understand your company’s major competition and market niche. • Create operating financial and marketing plan for your company. • Provide best practice benchmarks for business development: financial and licensing terms relevant to your valuation. Translation 3/1/2014 mnapier@genescout.com 3
  • 4. Before getting to the model Photo Masks Microscopy Define who you are. Define the application. Research Tool Define the market and the product. Others? 3/1/2014 mnapier@genescout.com Nano Lithography (Template Fabrication) SemiConductors (circuits) Others? 4
  • 5. ‘Crossing the chasm’: defining your market, obtaining PoC customer Market: 1. A set of actual or potential customers 2. for a given set of products or services 3. who have a common set of needs or wants AND 4. who reference each other when making a buying decision(1). Proof of concept customer: Pilot project (s) to validate technology (1) Geoffrey Moore, Crossing the Chasm (Collins Business Essentials, 1991). P. 28. 3/1/2014 mnapier@genescout.com Market Adoption 5
  • 6. Decision Point: Is it a publication, sponsored research or a new company? Not your decision entirely. • IP estate: yours and the marketplace. • Market Potential: your market positioning. • Team. • Money. 3/1/2014 mnapier@genescout.com 6
  • 7. The step function of building value. Exit Beta two Beta one 40% return Alpha 3/1/2014 mnapier@genescout.com 7
  • 8. Creating Value: Thinking simply, cutting through confusion. Revenues – Costs = Profit Bid Price on Contract 3/1/2014 Consumables Contract mnapier@genescout.com 8
  • 9. Types of Valuation Models • The emotional model • The discounted cash flow model • The comparables model • Others? 3/1/2014 mnapier@genescout.com 9
  • 10. Negotiation and valuation Understand your customer’s mindset…understand your financier’s mindset. • The Angel • The Venture Capitalist • The Strategic Investor 3/1/2014 mnapier@genescout.com 10
  • 11. Early stage valuation: the influence of comparables. Public comparables. Private Comparables2 Series A: Nano Opto Corp: $16M raise. IPO valuation down Pharmaceuticals: Series B: Nanotechnologies: $6.4M raise, $19M post money. Applied Microstructures: $8.5M raise. Raise less than $100 for A ~$200 valuation IPO Exit. NEWCO Nano Public market Comparables3: Series C: Molecular Imprints: $17-25M raise. Post money ~$100M SMMX: $869M CALP: $176M ACCL: $175M Series D (C): Nanosphere: $59M raise, Post money~$100-$125M 3/1/2014 Sources Cont’d 2.) OneSource and company websites. 3.) Market caps supplied by Yahoo Finance, May 16th 2006. mnapier@genescout.com 11
  • 12. Takeaway Exit Investor: “Buy Low, Sell High” Beta two Entrepreneur: know thy market, love thine customer. Beta one Alpha 40% return 3/1/2014 mnapier@genescout.com 12

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