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Tekcapital PLC: THE INVESTMENT CASE

Tekcapital providing investors with plenty of food for thought

The firm has established connections with more than 4,000 universities in 160 countries enabling it to capture all of the intellectual property available
Tekcapital providing investors with plenty of food for thought
INVESTMENT OVERVIEW: TEK The Big Picture
The company has switched its focus and is now acquiring (at pace) new technologies

Tekcapital PLC (LON:TEK) offers investors a chance to invest in some of the world’s most pioneering early-stage technology.

It has been acquiring tech for its own portfolio and has bought a slew of intellectual properties, plus it has developed one technology of its own.

Intellectual property route to healthier eating

One example of this is its Crackle-baked process, which can make baked food taste like fried but reduces the fat content by 60%.

This process, ideal for chicken nuggets and battered fish, “is a very compelling technology and very timely”, according to Tekcapital’s executive chairman, Clifford Gross, with more than 750mln people in the world suffering from obesity.

“We have reached out to a number of major food processors, and the general response has been very positive,” he added, noting that he expects a large company to look to license the technology in the near future.

In a similar vein, the company acquired the exclusive licence to a patent application for the measurement of glucose in saliva, which could replace the need for invasive blood tests repeatedly taken by diabetics.

It has also bought a US patent for a production technique that reduces the amount of salt in food and avoids the need for sodium salt substitutes like calcium, potassium or magnesium salts.

The patent could enable the company to commercialise a replacement for table-top salt and salt in crisps, popcorn, cereals and spice mixes.

Test quantities of µSalt, as it has been dubbed, were manufactured in a facility regulated by the US Food and Drug Administration before being supplied to several organisations for independent testing.

Lest you think the company is purely focused on products aimed at healthier eating, read on.

University challenged

Another acquisition was a piece of gesture recognition software from the University of Central Florida that can track and interpret inputs such as handwriting and drawings on tablets and desktops.

More recently (in October 2017) the company licensed a patent developed by the Florida Agricultural and Mechanical University that could be the backbone of software for autonomously controlling cars, trucks and drones using artificial intelligence.

That deal was a perfect example of what Tekcapital does: it uses its knowledge of what intellectual property (IP) is lurking in the databases of universities around the world to find new products for itself or its clients.

It has developed a search engine to scour the universities, select appropriate results and share them with a relevant client.

Put simply, the firm has established connections with more than 4,000 universities in 160 countries enabling it to capture all of the intellectual property available for licensing from these institutions.

This gives the firm a unique advantage, and as Gross said: “There’s strength in numbers”.

Tekcapital’s experience and position in the market also make it very difficult for any potential competitors to muscle in on its patch.

Belluscura the star ...

Clearly, the company’s model offers scope for the company to cash in on its assets via spin-offs, and it has started marching down this route with a new subsidiary that has licensing deals for three products made by med-tech giant Stryker.

The new Tekcapital business is called Belluscura and now holds the rights to: Slyde, an evacuation sled; Passport, a cutting device used in keyhole surgery; Snap II, which monitors consciousness during general anaesthesia; and Wire Caddy, a proprietary wire management system used in operating theatres.

In February 2017, it signed a co-exclusive licence and development agreement with Separation Design Group, a leading research laboratory in the field of oxygen concentrators, to develop a portable oxygen concentrator.

Successful development of a product will see Belluscura targeting the massive market for treatment of chronic obstructive pulmonary disease.

Belluscura will look to bring in further devices to the portfolio and could one day be spun-out of Tekcapital to have its own listing on Aim.

READ Tekcapital says investee company Belluscura decides not to proceed with planned Aim float

Crypto-currency revolution has not escaped the firm’s notice

Tekcapital’s augmented reality portfolio company Lucyd Ltd launched a cryptocurrency token sale in September 2017 to fund its range of augmented reality glasses.

By January 2018 it had reached the minimum subscription level for its token sale, having sold US$1.5mln of Lucyd tokens; the token event will now complete on or before February 28. The token event had a target of US$10mln.

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