Bio nano elements of early stage valuation and value growth
Elements of Early Stage Valuation
and Value Growth
Gene Scout Talk for NanoBioConvergence
Mary D Napier
May 17, 2006
What we do
Gene Scout advises along several aspects of technology
Commercialization pending on the needs of the client.
IP, literature and clinical trial scan in your company’s scientific
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.
Before getting to the model
Define who you are.
Define the application.
Define the market and the product.
‘Crossing the chasm’: defining your market, obtaining
1. A set of actual or potential
2. for a given set of products or
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
(1) Geoffrey Moore, Crossing the Chasm (Collins Business Essentials,
1991). P. 28.
Is it a publication, sponsored research or a new
Not your decision entirely.
• IP estate: yours and the marketplace.
• Market Potential: your market positioning.
The step function of building value.
Types of Valuation Models
The emotional model
The discounted cash flow model
The comparables model
Negotiation and valuation
Understand your customer’s mindset…understand your
The Venture Capitalist
The Strategic Investor
Early stage valuation: the influence of comparables.
Nano Opto Corp: $16M
IPO valuation down
raise, $19M post money.
Raise less than $100 for
A ~$200 valuation IPO
Nano Public market
Molecular Imprints: $17-25M
raise. Post money ~$100M
Series D (C):
Nanosphere: $59M raise,
2.) OneSource and company websites.
3.) Market caps supplied by Yahoo Finance, May 16th 2006.
Investor: “Buy Low, Sell High”
know thy market, love thine