Venice SMEs Seeking Finance2
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Venice SMEs Seeking Finance2



When seeking finance for an IP based SME beauty is in the eye of the beholder. For European Patent Office

When seeking finance for an IP based SME beauty is in the eye of the beholder. For European Patent Office



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    Venice SMEs Seeking Finance2 Venice SMEs Seeking Finance2 Presentation Transcript

    • Problems faced by SMEs when seeking finance
      lessons to learn
      Iain C Shirlaw,
      Director Equity Financing
      Venice, November 2008
    • Tangible and Intangible Book Value
    • IV as % of Market Capitalisation, 2005
    • IV as % of Market Capitalisation, 1975
    • “Beauty is in the Eye of the beholder” Greece, 3rd Century BC
      The Inventor of IP
      The Financier
      The Manager
    • The Inventor
      Typically a public sector employee
      Expert (Knows a lot about a specialised niche)
      Funding is usually a grant
      Idea is worth billions
    • The Financier
      Typically an accountant
      Non Expert (Knows a little about many things)
      Funding is based on a specific target return
      Idea is worth nothing unless it has EBITDA
    • The Manager
      Typically used to work for a large company
      Has been a functional specialist
      Funding is something to pay his salary
      Idea will make millions for somebody!
    • The Industry
      Has shareholders to satisfy
      Has a traditional perspective
      Investors don’t want risk
      Need Proof the idea is worth anything!
      And have a lot of cash!!!!
    • The Business Model
      Invest 20x$25m in R&D to get 20 candidates ($25m each)
      Invest $20m in pre-clinicals – Lose $10m
      Invest $25m in Phase 1 – Lose $12.5m
      Invest $25m in Phase 11 – Lose $16m
      Invest $50m in Phase 111/1V – Lose $25m
      Invest $50m in FDA and market Approval – Lose $25m
      Win!!!! Generate $120m per year for 10 years
    • Bridging The 7 Stages of SME Growth
    • The Lesson to be learned
      Aim for value at each stage
      Learn and Build your capability
      Know your buyer - Pharma?
      Be ready for change!
      Get your timing right!!
      Iain C Shirlaw,
      November 2008
    • Seven Ages of Man
      Old Age
    • As You Like it Act 2, Sc 7 Shakespeare
      "All the world's a stage, and all the men and women merely players;They have their exits and their entrances;and one man in his time plays many parts,His acts being seven ages.
      At first the infant, mewling and puking in the nurse's arms;And then the whining school-boy, with his satchel And shining morning face, creeping like snail unwillingly to school.
      And then the lover, Sighing like furnace, with a woeful balladMade to his mistress' eyebrow.
      Then a soldier, full of strange oaths, and bearded like the pard, jealous in honour, sudden and quick in quarrel, seeking the bubble reputation even in the cannon's mouth.
      And then the justice, in fair round belly with good capon lin'd, with eyes severe and beard of formal cut, full of wise saws and modern instances; and so he plays his part.
      The sixth age shifts into the lean and slipper'd pantaloon, with spectacles on nose and pouch on side; His youthful hose, well sav'd, a world too wide for his shrunk shank; and his big manly voice, turning again toward childish treble, pipes and whistles in his sound.
      Last scene of all, that ends this strange eventful history, is second childishness and mere oblivion;Sans teeth, sans eyes, sans taste, sans everything." )
    • Iain Shirlaw
      Contact details:
      international corporate and transaction advisor
      life sciences and healthcare