Portfolio Update Q3 2022
Sure Ventures plc (‘Sure Ventures’ or ‘the Company’)
Portfolio Update Q3 2022, NAV Calculation and Director commentary
Sure Ventures 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 €1.40 which is a 4.76% decrease from its NAV as at Q1 2022.
Sure Valley has several investments across the AI, AR, VR and IoT sectors and the major contributing factors and commentary on underlying companies that has driven this NAV calculation are as follows:
GetVisibility
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). The software enables customers to find, protect and remediate issues with sensitive/confidential and regulated data. Getvisibility also integrates into data protection solutions like Azure Information Protection (AIP) from Microsoft to allow customers to apply protection automatically (removing the need for manual intervention by staff).
GetVisibility have made some key customer wins, has opened a new US West Coast Office in San Francisco, California and has be awarded the Horizon Europe Seal of Excellence. The product role out is positive and we are very pleased with their progress and look forward to sharing more news in the Q4 update.
Smarttech247
Smarttech247 is a multi-award-winning MDR (Managed Detection & Response) company and amarket leader in Security Operations. Trusted by global organizations, Smarttech247 combinethreat intelligence with managed detection and response to provide actionable insights, 24/7threat detection, investigation, and response. Smarttech247’s service is geared towards proactiveprevention and this is done by utilizing the latest in cloud, big data analytics and machine learning,along with Smarttech247’s industry leading incident response team.
Smarttech 247 has now listed on AIM on the 15th of December 2022 at a valuation of £36.8m raising £3.67m from investors and will us the cash injection to fund its continued international growth. The Company is profitable and cash generative and has achieved significant revenue growth in FY21 (20% over projected revenue and 50% growth compared to FY20) and expects continued growth in FY22.
Smarttech247 has a diverse portfolio of blue-chip customers that includes pharmaceutical, technology, industrial and services companies. The Company has demonstrated a return on investment for clients that have implemented its platform. Forrester Consulting determined that the VisionX product provides in excess of a 300% ROI and €2 million net of present value (NPV), providing customers with a “payback” on investment within 6 months.
Smarttech247 is highly focused on innovation and operational excellence and has exciting plans to continue to expand its Research and Development department in order to further enhance its security technologies. Two new proprietary technologies ThreatHub and VisionX were launched in 2022, in addition to NoPhish in 2021.
EveryAngle-New Investment
We are pleased to announce a new investment completed by the first Sure Valley Ventures fund (“SVV1”) in EVERYangle Ltd, trading as EVERYANGLE, a Dublin-based, computer-vision company that helps physical retailers, hospitality venues, and convenience service stations to optimise operations.
EVERYANGLE has raised €2.7 million in a seed fundraise which will be used to accelerate sales, invest in ongoing product development and drive further expansion in the US and UK. The funding round was led by Sure Valley Ventures, Act Venture Capital and Furthr VC (formerly DBIC Ventures), with participation from Enterprise Ireland.
EVERYANGLE’s platform uses computer vision and machine learning to analyse CCTV footage rapidly and cost effectively at-scale to help retailers, hospitality and fuel station operators gain rich in-store customer insights, reduce loss and optimise their operations. The company plans to increase its headcount over the next 24 months with recruitment underway for key hires in machine learning, data science, software engineering, product management and sales. EVERYANGLE has developed strategic go-to-market partnerships with major vendors including Cisco and SAP, global distributors such as TD Synnex, as well as international reseller partners including CDW and WWT. These extensive partnerships enable EVERYANGLE to serve sectors such as retail, hospitality, manufacturing and healthcare, with customers including Mulberry, Peloton and Oxford Industries.
Listed holdings
Equity markets have been volatile, and both Engage XR (EXR.L) and Immotion PLC (IMMO.L) traded lower on a quarter-on-quarter basis. The AIFM are happy with both positions and are long term investors.
Immotion PLC
With revenue of £4.4m for the first half of 2022, almost double the same period last year (and exceeding that of our seasonally stronger H2 last year) the strength of our core LBE business is being demonstrated clearly and I am excited by its growth prospects.
The decision to focus all our efforts on LBE is delivering results and with the disposal of Uvisan and the spin out of HBE now agreed in principle we can, as we move through the remainder of H2, focus our planning and resources on accelerating growth of our core LBE partner estate.
We believe that considerable growth opportunities lie ahead of us in both the aquarium sector, where we are now a well-established player, and in the zoo market where we have taken our initial steps in what should be an even larger market.
ENGAGE XR
Interim results in September 2022 showed that the business was trading well with total revenue for the Group up c.41% to €1.76m (H1 2021: €1.25m ), ENGAGE revenue up 62% to €1.46m (H1 2021: €0.90m) with the Unaudited gross margin 81% in H1 2022 (H1 2021: 80%) and net cash of €4.9m as at 30 June 2022.
While interest remains strong in ENGAGE, the Board expects that the Group will be behind current market consensus expectations for 2022 in terms of revenue and EBITDA loss. The Board currently expects to report Group revenues for the year to 31 December 2022 of between €3.5m and €4.0m with an EBITDA loss of between €5.6m and €5.9m reflecting the increased headcount in the Group. ENGAGE revenues are expected to have increased by at least 70% year on year and now represent approximately 86% of the Group’s revenues.
SURE VALLEY VENTURES ENTERPRISE CAPITAL FUND
Sure Valley Ventures (“SVV”) has led a £3m seed round in Opsmatix Systems Limited trading as Jaid (“Jaid”), an innovative technology firm providing AI-powered human communication solutions, marking the fund’s second investment. The proceeds of the funding will be used to expand its industry-leading machine learning team, build out business development efforts across America and Europe and expand into Asia.
Jaid is a rapidly growing company that provides AI as a Service (AIaaS) solutions to businesses to automate a variety of use cases, including client service automation, sales automation, payment exception processing, and claims administration processing. Jaid’s technology helps businesses reduce costs, improve efficiency, and make data-driven decisions.
This will now appear in our NAV calculation of the Q4 update which we will release in February 2023.
Sure Ventures PLC NAV
The Sure ventures PLC NAV at the end of September 2022 sits at 124.09p. This represents a 1.32% decrease across the period, down from 125.75p per share at the end of Q2. This decrease represents costs and changes to the value of its listed holdings in Engage XR and Immotion PLC.
Forward looking statement & Director comment
When calculating the NAV for both Sure Valley Ventures and Sure Ventures PLC we do not re-rate an unlisted investee company valuation unless there is a funding round priced by another investor. The nature and stage of the software companies that we invest requires patience and we are now starting to see these businesses mature at a strong pace. The pipeline of deals for Sure Valley Ventures Enterprise Capital fund remains robust despite the market conditions
Gareth Burchell comment
“The market back-drop and specifically the technology sector has had a hard year in 2022. The Sure Ventures NAV has remained strong given this backdrop and several of the investments in the fund are starting to attract interest from larger, more acquisitive players in their relevant verticals.
We welcome two new investments in Everyangle (SVV1) and Jaid (Enterprise Capital fund) both of which have been funded from current cash. The listing of Smarttech247 will of course be represented in our Q4 NAV, but we are pleased with the injection of capital and look forward to being updated with its progress.”
For further information, please visit www.sureventuresplc.com or contact:
Gareth Burchell
Sure Ventures plc
+44 (0) 20 7186 9918
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/