Investee companies – one year on
As if life in a young company isn’t hard enough, sometimes it just deals you the proverbial ‘kick in the teeth’. In a number of instances during the past 12 months, the lives of some pioneering new business leaders were tragically cut short. These events could have had disastrous effects on their companies. But did they? There is always hope that springs from such tragedies and it seems clear in the cases we look at below, that the dreams and aspirations of these individuals are being taken forward by those who they inspired to join them on the journey.
In this issue YCF catches up with four companies featured in early 2007 issues and our update begins with a company that has spent much of the last few months restructuring.
Rugged Logic
Liverpool accountancy software company, Rugged Logic secured £625k from the Merseyside Special Investment Fund, NWDA and Business Liverpool in January 2007.
Rugged Logic sells a package of forecasting accounting tools based in Microsoft Excel. A perceptive product which allows FDs to combine historical financial data with what a company feels are specific threats and business drivers. ‘What If’ scenarios can be modelled instantly and compared on screen, variances can be produced, and key Indicators can be set up, all helping build what they consider to be personal and accurate future plans. Customers include venture capital companies, large accountancy practices and banks. A package priced at what they feel is a mid-market price at £10,000 plus VAT.
We were delighted to catch up with Rugged Logic’s new Managing Director Tony Sparks to discuss the change in thinking that led to his appointment in January this year.
Tony Sparks: ‘There are few products in the forecasting market dealing in perceptive processes. Our product range does, allowing financial directors and financial planners to prepare forecasts which are relative to their specific business environment.’
Rugged Logic began selling its range direct to large companies such as BT and PricewaterhouseCoopers and even developed a product to help owner-managed operations – the Cashflow Wizard but this tool is no longer within this market’s price range. The company has refocused its operations to sell via software Value Added Resellers (VARS) and Enterprise Resource Planners (ERPs). This has led to a complete senior management restructuring.
In the December 2007 restructuring the company announced that technology entrepreneur and accountancy industry specialist Paul Druchman, who joined the Board earlier in the year, has now taken on the role of Executive Chairman. Founder Geoff Bristow remains a key part of the senior team providing the technology leadership as Chief Technology Officer.
Rugged Logic’s first MD Nick Bowles has moved aside to continue working in product development alongside Geoff making way for channel management and distribution specialist Tony Sparks in January 2008.
The transformation will be completed by the summer as Tony looks to appoint a Channel Sales and Support Team at its Vanilla Factory Offices in Liverpool which will bring the head count to 14.
Since his appointment the company has added two more resellers to his books: Armstrong Consultancy and Asyst.
Tony is also delighted to announce that Rugged Logic has also been invited to join the Microsoft Accelerator Scheme:
‘Only 10 UK companies have been invited to join so we are pleased that Microsoft has recognised that our product has global potential and is a perfect fit with their Office strategy. We feel this will enable us to advance our product by working closely with Microsoft engineers and Excel 2007.’
Contact Tony Sparks Telephone: 08451 264 100 Website: www.ruggedlogic.com
Our next two companies are both located nine miles from Newcastle Upon Tyne within the small industrial town of Cramlington, Thermastrate and Applied Neurodiagnostics. The NorthEast is home to twopharmaceutical giants Aesica (formerly BASF) and Merck, Sharpe and Dohme who have manufacturing plants in the area.
Thermastrate
The loss of technology pioneer and founder of Thermastrate, Bob Morse from a short illness in July 2007 has not deterred his wife, his team or their investors from realising this man’s aspirations. We spoke to Dr Neil Loxley, ex CEO Bede Plc -X ray metrology tools for the semiconductor industry – who was appointed as MD to stabilise the company during 2007.
‘The significant progress that Bob and his wife Kaye had made in building a good and talented team meant that my role is to provide corporate leadership and to complete the work started by Bob. For instance: the funding we received from our investors meant that we now have a state-of-the-art facility in operation at Cramlington’s Nelson Business Park.’
Thermastrate provides advanced solutions in thermally efficient substrates for all power electronic packaging applications. Its products are custom designed and are offered as integral circuits on heat sinks (a material that absorbs heat) and manufactured and tested electronic sub-assemblies.
It has two core products: Flexitherm™ and Ultratherm™ which they sell into the solar energy, lighting, high brightness LED, high power electronics, automotive, military and aerospace markets.
Bob set up the company in 2004. Kaye Morse – an experienced company director who had herself set up and run two companies, was compelled to join her husband to provide the essential office management to get this start up on the map.
Kaye Morse: ‘Bob had always wanted to bring his own commercial ideas to market but with a growing young family we had to wait for the right time to do it.’
Kaye remains a key part of Thermastrate providing office management support to Neil. The team expanded in 2007 with the recruitment of business development and technical expertise made possible by the investment last year.
Contact: Dr Neil Loxley Telephone: 01670 717830 Website: www.thermastrate.com
Applied Neurodiagnostics
Applied Neurodiagnostics founder Bob Sinclair was born in the North East but made his fortune in the United States. Keen to establish a UK presence for his eye tracking products which are used to detect neurological disorders at an early stage, a UK company under the same name was set up in 2003. Bob is another of our pioneers who lost his life following a short illness in January 2008.
Applied Neurodiagnostics is now led by Keith Morris who joined the company from the Centre of Excellence in Life Sciences (CELS) in January 2007 where he held the position of Director of Markets and Technologies. His appointment marked a major turning point in the company’s journey following its £1.2 m investment from NSTAR and a group of private investors.
Applied Neurodiagnostics first product is a test to be used by Optometrists. The Pupilmetrix test is quick- 1 minute per eye, which they promote as reliable in that it does not require any action on the part of the patient and easy to operate. It uses an infra-red pupilometer to detect the response of a patient’s pupils to a series of specially designed shapes presented on an LCD screen. Using proprietary software the PLR60 then calculates a result that indicates whether or not the retina is damaged. Such damage occurs in diseases of the eye such as Glaucoma.
Keith was quick to stress to YCF that the UK organisation is a completely independent company and not a subsidiary of US based Applied Neurodiagnostics:
‘The connection was Bob Sinclair. He invested his own money into starting the UK company. We license the technology from the US and purchase components from them.’
Keith originally joined the company to product manage the Pupilmetrix-PLR60 but quickly assumed a leadership role to help direct and focus the team he joined towards some important milestones in 2007.
One of the first objectives for Keith and the team was to secure the CE Mark for Pupilmetrix-PLR60. This was awarded in December 2007 – a milestone they have achieved in less than a year.
Keith continues:
“Our goal is for the Pupilmetrix-PLR60 to form part of the standard eye test in the high street Optometrist and we are delighted to announce that our product was installed in a privately owned Optometrist in Durham just a few days ago.”
Keith and his team have been working on a regional North East launch in March and this will be followed by a national launch later in the year.”
Keith also confirmed that Applied Neurodiagnostics has secured a further £350k in January 2008 from original group of investors to support the product launch.
Contact Keith Morris Telephone: 01670 712622 Website: www.pupilmetrix.com (Goes live beginning of April 2008)
Integrated Hydrogen Solutions
Dr Ruth Wroe also lost her life to a short illness in 2007. Ruth was leading the formation and development of Cheshire-based Integrated Hydrogen Solutions. The company was set up to combine a number of different existing technologies to enable significantly enhanced hydrogen production, storage and release. The company emanates from C-Tech Innovation a development and consulting company. C-Tech Innovations provides laboratories and workshops allowing experimental and prototype equipment to be designed, constructed and fully proven, in complete confidence, prior to full commercialisation.
RisingStars Growth Fund II’s Mark Wyatt who invested in the company in December 2006 confirmed that the team are in the process of developing the company in light of Ruth’s untimely departure.
Copyright Young Company Finance 2008
