EcoMachines - Technology Dissemination in Practice - LESI Global Technology Impact Forum 2014

©2013 EcoMachines Incubator Ltd. All rights reserved
To: LESI Global Technology Impact Forum 2014
ILIAN ILIEV
CEO, EcoMachines Incubator
Founder Director, CambridgeIP
21st January 2014, Geneva

We need to move beyond the patents
‘good’ vs. ‘bad’ debate
2 © 2012 Cambridge Intellectual Property Ltd. All rights reserved
IP
Guy

IP strategy is set and executed in a complex environment
Multiple business models and ways of using IPRs, depending on industry history,
economics, inherited business models, cultural norms, investor influence and so on
3 © 2010 Cambridge Intellectual Property Ltd. All rights reserved.
Investors/Shareholders
Choiceof
R&D/commercialis
ationChannel
In-house
Collabo-
ration
Licensing
Spin-off
Value Chain Partners/Collaborators
Competitors
Role of IPRs inEach Part of InnovationChain
? ? ? ? ? ?
Product
Licence
Services

But even more broadly...
Patents and IP strategy – alongside R&D
strategy, corporate venture capital,
entrepreneurial strategies, innovation finance
strategies – are all different facets of the same
thing
Technological change and its link to social
needs - expressed through the market or
otherwise

Institutions differ between and within countries...
...so innovation, entrepreneurship, IP strategy are organised
differently between economies

My own contributions to the technological change
and entrepreneurship debate and practice have
been primarily through 2 organisations :
Fact-based patent intelligence to inform
policy debate and business strategy
Funding and acceleration for patent-
intensive advanced engineering startups
in focused on energy and cleantech

About CambridgeIP
7 ©2014 Cambridge Intellectual Property Ltd. All rights reserved
CambridgeIP is a global innovation and IP consultancy
CambridgeIP assists clients to accelerate the development and deployment of their
valuable technologies, make fact-based investment decisions and monitor their
competitors

CambridgeIP’s research informs policy debate in
climate change, healthcare, and other fields.

Patent landscaping in breakthrough areas:
example of Graphene
9
© 2013 Cambridge Intellectual Property Ltd. All rights reserved
Example graphene applications
• Faster computers
• More sensitive and robust sensors
• Thinner and flexible displays
• Tougher and more conductive
polymer composites
• Super-capacitors
• Batteries

We invest in
and accelerate the growth
of promising startups in
high-value manufacturing
and advanced
engineering.
At the early stage,
companies working in
these areas face a funding
gap: we’re filling that gap.
Investments
are made as part of an
Accelerator, which
includes equity finance,
mentorship, strategy
development, support in
accessing
grant finance and
industry partners.
About EcoMachines Incubator

Power Generation Transport Water
Energy Efficiency Materials Smart City
Sectors of Interest
EcoMachines focuses on investing in innovations in the following areas:

The EcoMachines Approach
What is a startup for us?
A startup is an organization formed to search for a repeatable and scalable
business model (2010, Steve Blank)
A startup is a human institution designed to deliver a new product or service
under conditions of extreme uncertainty
(2010, Eric Ries)
A startup is most of all a business experiment
EcoMachines’ Accelerator programme aims to:
Provide startups with the resources and guidance to design and
conduct the business experiment...
...in order to help build a validated investment proposition...
...and get the funding required to scale the startup’s model.

EcoMachines objectives for the
collaboration with WIPO Green
Help transform the IP assets and needs revealed in WIPO
Green’s marketplace into successful entrepreneurial start-
ups/companies
Help develop companies that link:
• Developed economy entrepreneurs with emerging economies’ high-
growth/high-need areas
• Emerging economy entrepreneurs with developed economy
experts/knowledge base

Accelerator Programme
We help entrepreneurs to transform their business from a startup with a
proof-of-concept technology into a high-growth, investable company.
Stage 1
Startup
Stage 3
Follow On
Result
Our 9-month Accelerator programme is specifically designed for hardware &
advanced engineering startups.

Accelerator Programme
EcoMachines provides:
+ seed funding of up to £100,000, which helps startups access grant
funding and other investment
+ access to a global industrial and investor network – including in key
emerging economies
+ intensive mentoring in core business areas
+ follow-on funding of up to £500k, as part of larger Series A fund

Selection Criteria
Strong & Committed Team
1
2
3
• Successful teams must contain a range of expertise
• Key team members must be working on the startup on a full-time basis
• Willingness to change business model ... repeatedly!
Market Focus
• We favour technologies or products with multiple possible market applications
• We are interested in businesses that are scalable at reasonable capital cost
Technology Maturity and Type
• At least at Proof of Concept level (TRL 3+)
• Software and connectivity plays an increasingly important role in hardware
innovation – so we’ll look at software-enabled hardware too
We are flexible in our expectations for the level of maturity of the business
and technology, but there are several broad selection criteria

Selection Criteria
Exciting Technology or Product
4
5
6
• We are interested in disruptive innovations, rather than incremental
innovation
• Patents or patent pipeline
Credible Exit Scenarios
• Can you demonstrate a credible exit scenario showing a) possible buyers of
the company if it’s successful and b) what the drivers of an acquisition would
be?
Grant Co-Funding Potential
• We are particularly interested in companies that have been awarded or are
awaiting results of a grant application
• Use our equity as leverage for more applications
We are flexible in our expectations for the level of maturity of the business
and technology, but there are several broad selection criteria

Management Team
CEO and Founder
Ilian Iliev
Founder Director
Oleg Evdokimenko
Director
Alexy Krenke
Investment Relations
Oksana Hilinskaya
Analyst
Robert Snellgrove
Peter Feulner
Leader of Technology,
Innovation and Strategy
at Ricardo Germany
Igor Turevsky
Ex-Global Sales and
Busdev Director of
Alstom Network
Management
Laurence John
VC and investor; ex-CEO
of Amadeus Capital’s
Seed Funds
Prof. Nelson Philips
Chair in Strategy and
Organisational Behaviour at the
Imperial College Business School
Advisory Board

Mentors
Former head of intellectual
property at BP; Founder and
owner of Fairoaks IP
Mike Barlow
Co-founder and President,
Operations at Owlstone
Nanotech
Billy Boyle
Founder and Non-Executive
Director of Brady plc
Robert Brady
Managing Director, Sustainable
Blueprints; Ex-Head of Water
Insight Services, BNEF
Dimitra Christakou
CEO of Puntios, which creates
and finances technology spin-
outs from industry.
Simon Hombersley
Energy Policy Advisor ,
Energy Technologies Institute
(ETI)
Mahdi Kazemzadeh
European Patent Attorney,
Partner at Mathys & Squire
Alan MacDougall
Director at Fidem Partners
Hristo Mitchkovski
Chairman of Cambridge
Cleantech
Hugh Parnell
Business change and growth
leader
Sir Eric Peacock
Founder Director at
Productiv; Chairman at
Oxford BioMedica
Nick Rodgers
Managing Partner and
Co-Founder of White Lake
Strategic Advisory Group
John Rowland

Mike Barlow
Former head of
intellectual property at
BP; Founder and owner
of Fairoaks IP
Billy Boyle
Co-founder and
President, Operations
at Owlstone Nanotech
Igor Turevsky
former Global Sales and
Business Development Director
of Alstom Network Management
Professor Nelson
Philips
Chair in Strategy and
Organisational Behaviour
at the Imperial College
Business School
Nick Rodgers
Founder Director at
Productiv; Chairman
at Oxford BioMedica
Peter Feulner
Leader of Technology,
Innovation and Strategy at
Ricardo Germany
Sir Eric Peacock
Business change and growth
leader
Laurence John
VC and investor; ex-
CEO of Amadeus
Capital’s Seed Funds
John Rowland
Managing Partner and
Co-Founder of White
Lake Strategic Advisory
Group
Alan MacDougall
European Patent
Attorney, Partner at
Mathys & Squire
Robert Brady
Founder and Non-
Executive Director of
Brady plc
Mahdi
Kazemzadeh
Energy Policy Advisor ,
Energy Technologies
Institute (ETI)
Simon Hombersley
CEO of Puntios, which creates
and finances technology spin-
outs from industry.
Hristo
Mitchkovski
Director at Fidem Partners
Hugh Parnell
Chairman of Cambridge
Cleantech
Dimitra Christakou
Managing Director,
Sustainable Blueprints; Ex-
Head of Water Insight
Services, BNEF
Mentors

Based in Central London
Our central London location gives the companies we invest in
access to:
+ World leading universities
+ Angel investors
+ Family wealth offices and institutional investors
+ Global corporate HQs
+ Industry experts
+ Proximity to Cambridge, Oxford and other UK high-tech clusters
+ Great connectivity to other EU high-tech clusters

Investment portfolio:
Nanotech Industry Solutions
Nanotech Industrial Solutions (NIS)
is a developer and manufacturer of
nanomaterials for the petrochemical
and applied materials industry.
The award-winning technology enables the
commercial production of nanoparticles made
of tungsten disulphide. When added to
lubricants, the particles significantly reduce
both friction and wear under conditions of
extreme pressure and temperature. The
technology also has applications in drilling
muds, polymers, nano-composites, coatings
and epoxies.

Investment portfolio:
Rotary EcoMachines
Rotary EcoMachines is developing
a family of innovative rotary
combustion engines with a
jumping axis geometry.
Its first product – EcoPulse – is a compact,
light-weight and highly efficient engine
aimed at the hybrid and electric car market
as a range extender. Rotary EcoMachines is
also working on other engine designs that
can be used as a primary engine for other
light transportation devices.

What is the Accelerator approach?
Common to all Accelerators is:
• a structured approach of equity investment + Accelerator programme
• Preparing the company for a follow-on funding round
• Use of mentors and partners in accelerating growth
• Use of Lean-type strategy - change of business model is encouraged
• A 3-6 month period of intense focus on company, then followed by lower
engagement
EcoMachines Incubator’s Accelerator programme - USPs
• Focus on energy/cleantech/green technologies
• Customized one-on-one Accelerator programme design
• Currently the largest hardware accelerator in UK in terms of level of funding
• Unique in providing an anchor funding of up to £500k
• Validated ability to syndicate $14.5mln + round

EcoMachines objectives for the
collaboration with WIPO Green
Help transform the IP assets and needs revealed in
WIPO Green’s marketplace into successful
entrepreneurial startups/companies
Help develop companies that link
• Developed economy entrepreneurs with emerging economies high-
growth/high-need areas
• Emerging economy entrepreneurs with developed economy
experts/knowledge base

Food for thought?

EcoMachines Incubator Ltd.
Rainmaking Loft, International House
1 St Katharine’s Way, London, E1W 1UN
(m) +44 (0)77 863 73965
(t) +44 207 1939 041
(e) ilian.iliev@ecomachinesincubator.com
(w): www.ecomachinesincubator.com
@ilian_p_iliev
@EcoMachinesUK
Company Reg. Number 8357617

The EcoMachines approach 2
The key principles of Lean Startup:
Startups can shorten their product development cycles
by adopting a combination of business-hypothesis-
driven experimentation, iterative product releases, and
"validated learning".
This can help reduce the market risks and sidestep the
need for large amounts of initial project funding and
expensive product launches and failures
Source: Eric Ries, The Lean Startup; HBR (2013) “Why the
Lean Start-Up Changes Everything”
What is the Lean Startup method ?
The Lean Startup approach has been tremendously influential as an entrepreneurial
approach for Web/software companies...
.... which has seen the bulk of VC investment in recent years...
... so hardware companies should be of interest!
But... Is Lean Startup appropriate for Hardware?
Key elements of Lean
Startup :
• Minimum Viable Product
• Continuous deployment
• Split testing
• Actionable metrics
• Pivot

The EcoMachines approach 2
Is Lean Startup applicable to hardware?
Hardware is ‘tricky’... And B2B is different from B2C
Here are some ideas on how Lean Startup translates into the hardware
B2B space
Lean Startup – key
elements
Hardware implications Solutions
Minimum Viable Product It takes more investment and time
to build an MVP for hardware
•Virtual prototyping
•Rapid prototyping & additive
manufacturing
•Scenario testing with clients
•Industry partnerships
•Low-cost prototyping
Continuous deployment It takes more time and ££ to do
iterations on hardware prototypes
Split testing It’s more expensive to build
hardware prototypes
Actionable metrics Different type of metrics for
hardware and B2B
Use deep sector expertise to
identify relevant metrics
Pivot More expensive Do market-product fit testing
earlier on

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