Thursday February 14th 2019

Thursday February 14th 2019

Angling Direct £21m | Kit for Kids £6.4m | Cera | MelodyVR £0m | Tom Davies £8m | BenevolentAI | Strix £88.7m | VP £248.7m

Fishing tackle - Kid’s furniture – Care App – Music VR content – Designer glasses

– Science with AI - Water temperature components –

B2B equipment hire

News about 8 UK growth companies and/or accelerators + turnover in the GRID marketplace 6th – 12th August 2017:

ANGLING DIRECT: fishing tackle - Norfolk

Fishing friends reel in the profits from their hobby | Laura Onita, The Sunday Times. August 6

DZ profile: Angling Direct Plc

Business: 15 fishing tackle shops across the country, with three more to open in the autumn. sells upmarket bait boxes, tents and head torches online and in-store. The company’s own range, Advanta, is manufactured in China and accounted for £1m of its revenues.

Launched: 1986

Location: Norfolk village of Rackheath

Founders: Martyn Page, 62, who had been making his own fishing kits since the late 1960s, and William Hill bought their first shop with £40,000 of savings and a bank loan. They decided to target affluent anglers willing to splash out on high-quality rods and reels. Hill stepped down recently and Page is executive chairman.

Staff: 170

Financials: made pre-tax profits of £660,000 on sales of £21m last year. Revenues are expected to reach £25m this year.

Investment: The founders still control the company and each own a 26% stake, with the rest split between staff. Last month cast its line into London’s junior market, netting a market value of almost £40m.

News:

1. Profits began to trickle in as the two snapped up nearby shops over the years. The expansion culminated with the opening of a fishing tackle superstore — Britain’s first — in 1996.

2. Angling is the sixth most popular pastime in Britain, with more than 4m people taking to boats, riverbanks and lakesides each year. The British fishing tackle market is estimated to be worth £570m a year. Devotees can spend between £5,000 and £25,000 on equipment, said Page.

3. Angling Direct will expand its foothold into Europe over the next 18 months. Currently, just 10% of its sales are overseas.

KIT FOR KIDS: children's bedroom products - Kent
Growing up fast | Peter Evans, The Sunday Times. August 6.
DZ profile: Kit For Kids Limited
Business: maker of high-end cot mattresses, carpets and furniture for toddlers and children. Products are stocked by retailers including JOHN LEWIS, TOYS R US and MOTHERCARE and sold in about 30 countries. Kit for Kids also sells to schools and nurseries. Cot mattresses are its best-seller, priced at up to £130.
Launched: 1993
Location: Kent
Founder: Jan van der Velde, 53, worked as an engineer and accountant before striking out on his own in 1993.
Financials: Last year the company reported profits of £79,157 on revenue of £6.4m.
Investment: has raised £3.7m from a private equity investor CONNECTION CAPITAL for research and development and to improve customer service.

CERA: app for elderly and carers - London
Care app lands big-name backers | Sabah Meddings, The Sunday Times. August 6 2017, 12:01am,
DZ profile: Golden Era Club Ltd
Business: An Uber-style app that allows families to book carers for elderly relatives … matches carers with patients, schedules appointments and keeps digital care records. Because it takes a smaller cut than traditional providers, carers are paid more. Relatives can use the app to receive updates on loved ones while doctors can check medication. In future, it will use artificial intelligence to recommend treatments for patients.
Launched: 2015
Location: London W8
Founder: Ben Maruthappu, co-founder and chief executive, 29, a doctor-turned entrepreneur, founded Cera after booking home care for his grandmother .
Investment: Cera, which is backed by a string of City heavyweights including former Standard Chartered boss Peter Sands, has received £500,000 from AURIENS, a luxury care home operator in west London in a deal valuing it at several million pounds. The investment will see a team of experts from private nursing firm DRAYCOTT, owned by Auriens, train Cera’s carers in “old-school” levels of care.

MELODYVR: Virtual reality company - London
Adele invests in London virtual reality start-up EVR Holdings | Jamie Nimmo, The Evening Standard. August 7
DZ profile: EVR Holdings Plc
Business: EVR’s MelodyVR app, which is in beta mode, allows fans to watch gigs on virtual reality headsets. …one of London’s hottest music start-ups. The company has signed deals to develop VR content with the music industry’s three biggest players: WARNER, UNIVERSAL, and SONY, which owns Adele’s American label, Columbia Records.
Location: London NW1
Staff: chief executive Anthony Matchett
Financials: Revenues to 31-Dec-16: £0m; Profit After Tax -£2.6m
Investment: AIM-listed. EVR’s share price rocketed at the end of last year after signing the first of its three big music deals. But since peaking in March, the shares have halved to 6.7p.
News: Singing superstar Adele has invested in EVR Holdings, the Evening Standard has learned. The London-born star, who has amassed a £125 million fortune, invested in EVR through a nominee account so her name does not show up on the shareholder register, a source said. The size of her investment is not known.

TOM DAVIES: upmarket eyewear - London
Tom Davies is the glasses designer swapping China for Brexit Britain | Joanna Bourke, The Evening Standard. August 7
DZ profile: TD Tom Davies Limited
Business: Tom Davies designs glasses for the rich and famous, and is blazing a trail at the premium end of the eyewear market
Launched: 2002 glasses business …market for bespoke, luxury frames.
Location: London SW14
Founder: Tom Davies, 42, first went to Asia in 1997, fresh from finishing an art and design course at the University of East Anglia. …accepted a job with a watchmaker who was starting an eyewear company and came in as chief designer. …in 2002, he headed back to the UK, leased some office space in Pimlico and launched his Tom Davies empire with a start-up loan from HSBC and money from his dad who remortgaged his house. A boutique Japanese company was used to make the products up until 2007. On his uppers, he moved production in-house, to a site in China, and his gamble to go solo paid off. The business has since grown to include four London shops which offer eye-testing; franchises in Malaysia and the US, and wholesaling in high-end eyewear boutiques. A pair of glasses comprising frames and lenses typically costs from £500 to £1100.
Financials: It expects to notch up sales of £8m this year, rising to £12m by 2020.
Investment: Davies still owns 50% of the company, private UK and Asian investors hold the rest.
News: In a boost for UK manufacturing and design, Davies will this year begin moving production of his bespoke specs from Shenzhen, China to … empty Brentford property, which resides on an industrial estate …a short hop from Boston Manor tube, where his team are building an £800,000 factory … where he will train a new generation of glasses makers. The Chinese factory will be retained but scaled down over the next few years. Some of the staff will travel to Brentford to teach school leavers and graduates skills which will combine traditional tasks such as hand filing with the latest tech. …hopes to pump out 10,000 pairs of specs per month from the site. …his eponymous label’s first UK factory, which will be home to 37 staff when it’s fully up and running in 2018. It will also serve as its head office. Davies adds: “I’m excited by the idea of combining the latest cloud-based manufacturing techniques with traditional hand-crafting skills… I think there is a huge appeal to luxury shoppers in Asia, America and Britain, to have ‘made in England’ products.”

BENEVOLENTAI: Scientific research with AI - London
UK startup BenevolentAI is embarking on major expansion in the US, opening a New York office | Lynsey Barber
City A.M. August 9
DZ profile: BenevolentAI Limited
Business: One of the UK's most promising artificial intelligence startup …uses AI to digest millions of pieces of scientific research and come up with potential treatments that may never have been spotted by human eyes. One such drug has been found to delay the onset of motor neuron disease in initial tests, with researchers pushing for further clinical development that could lead to a treatment for the disease.
Launched: 2013
Location: London headquarters …its speed of growth has spurred a hunt for significantly larger offices. It after four years in business, outgrowing its base near Euston station. Also has offices in Belgium and New York.
Founder: chairman Ken Mulvany.
Staff: has around 80 staff
Investment: valued at more than $1bn according to CB Insights and backed by Neil Woodford's fund, WOODFORD INVESTMENT MANAGEMENT LLP.
News:
1. is opening a new office in New York  ...expert tech team that the startup hopes to grow to  25 by the end of the year. Former IBM Watson executive Jerome Pesenti who was hired as chief executive of the technology side of the business late last year will run the new office. ... a New York base will give the firm access to key AI talent from the east coast of the US where experts are based at top research centres such as Carnegie Mellon.
2. ... plans to apply its AI technology to more industries, focusing on energy first. ... issue of how to make battery storage better. Currently, battery technology is not advanced enough to store the energy from renewables such as solar power. It's hoped the AI can identify new ways that are also affordable.

UPDATE:

BenevolentAI raises $115 million to extend its leading global position in the field of AI enabled drug development  Apr 19, 2018
3. .."has raised $115 million from new and existing investors at a pre-money valuation of $2 billion in one of the largest funding rounds in the AI pharmaceutical sector.The majority of investors are from the United States, expanding the Company’s global investor footprint. The balance of raised funds came from existing investors, including Woodford Investment Management. To date, the company has raised more than $200m of funding since 2013. 

4. ...currently employs 165 people who work in a unique, cross functional environment that incorporates leading edge data scientists, computer scientists, mathematicians and drug development R&D; scientists working side by side. The company is headquartered in London with further offices in New York and Belgium. BenevolentAI’s research facility is located in Babraham Science Park, Cambridge (UK).

STRIX: components for kettles – Isle of Man
Zeus brings Strix to the boil: Boutique adviser guides kettle safety company to £190m IPO | William Turvill, City A.M. August 8
DZ profile: Strix Group Plc
Business: designs, manufactures and supplies kettle safety controls and water temperature components and claims a 38 per cent share of the market and 61 per cent of the market in developed countries. The UK has 1.2 kettles per household, more than 32m. By 1988 the company was the world leader for the supply of kettle controls. In 1997 it opened a manufacturing plant in China. It has a factory in Ramsey, on the Isle of Man, to make the most specialised control parts. Kettle safety controls still represent about 90 per cent of annual revenue and customers include TESCO, TEFAL, SIEMENS, PHILIPS and WALMART.
Launched: 1951
Location: The Isle of Man
Founder: Eric Taylor invented a heating device for Royal Air Force bomber crews during the second world war to keep their suits warm at high altitude. 
Staff: chief executive Mark Bartlett.
Financials: to 31-Dec-16 - Revenue (£ m) 88.65; Pre-Tax (£ m) 24.14.
Investment: Strix Group successfully completed its admission on to London’s junior market today, raising £190m.
…..advised by boutique investment bank ZEUS CAPITAL ….with shares priced at 100p. The initial public offering (IPO) marks a full exit for Strix’s existing investor group, led by AAC CAPITAL PARTNERS, with almost 100 per cent of shares released to institutional investors. IFC ADVISORY ran PR and investor relations for Strix.

UPDATE:

Kettle parts-maker Strix aim to build head of steam in US | Andy Bounds, FT. August 26, 2018

1. shares are 65 per cent higher than their listing on Aim at 100p in August last year.  ...the company is now worth more than £310m. Mr Bartlett has said that Brexit should not pose a problem, since everything from the Isle of Man is shipped to China, where kettles and water filters are made. 

2. More kettles. In China it has half the market, and only four in 10 households have a kettle. In less regulated economies Strix has just 19 per cent market share. As safety controls tighten, Strix’s sales should grow. Just 13 per cent of US households have a kettle. Americans tend to make coffee at home and buy prepared iced tea or hot tea from stores.

3. More products. Strix invests almost 4 per cent of revenue in research and development each year.

• The company is considering moving into controls for coffee machines.  
• It has developed its own range of water filters, Aqua Optima and worldwide sales grew 19 per cent in 2017. Market share in the UK has risen from 6 per cent to 20 per cent in 18 months and Strix has a deal with PARK RUN, the organisation that stages free races in public parks, giving it access to potential Aqua Optima customers. Pharmacy chain BOOTS agreed to take the range in March.
• In 2017, Strix also launched a Perfect Prep product for preparing formula milk with baby product provider TOMMEE TIPPEE.

4. Strix has a portfolio of more than 150 patents. It won a landmark victory in 2010 in China receiving damages from companies. Mr Bartlett said this year alone the company had won infringement cases against 19 appliances in China, and had five web pages taken down by Amazon.

5. Brokerage SHORE CAPITAL forecasts turnover of £96.7m for 2018, up from £91.3m in 2017. Pre-tax profit, adjusted for one-off items, should be £29.5m, against £28.3m.

Small-cap focus: diversification the key for tool hire groups | Michael Pooler, FT. August 12.

VP: Equipment hire - Yorkshire
DZ profile: VP Plc
Business: specialist equipment rental company …serves a wide selection of industries including rail, transmission, water, civil engineering, construction, housebuilding and oil and gas. Of VP’s operating profit 95 per cent comes from the UK, and its fleet of equipment includes large forklifts for construction known as telescopic handlers, temporary bridges and pumps.
Launched: 1954
Location: Harrogate, Yorkshire
Financials: Pre-tax profit up 17 pc to £34.9m in the year ended March 31 2017; revenues were up almost a fifth to £248.7m
Investment: London Stock Exchange Main Market. ..stock up 8.8 pc this year to date, valuing the company at £334m
News: While the malaise in oil and gas markets has affected VP’s international division, the company has said its specialist test and measurement activities in the Asia-Pacific region are trading well.