Deepbridge Magazine - Spring 2021

MAGAZINE SPRING 2021

MEET THE FOUNDER

MEET THE COMPANIES

ENJOYING CHESTER

Ian Warwick looks back at Deepbridge’s journey to date and unveils future plans.

Hear from the leaders building the successful companies vTime and Zilico.

The Deepbridge team share their top tips for visiting Chester, including Chester Zoo.

FOR THE NEXT GENERATION. Prudent Inheritance Tax planning maximises the estate passed to future generations.

Equally, does it not make sense to ensure such planning is also supporting green energy projects which will enable those next generations to live in a cleaner world?

The Deepbridge Estate Planning Service provides subscribers with access to a portfolio of Business Relief qualifying renewable energy assets; driving renewable energy transformation, whilst offering IHT exemption after just two years.

www.deepbridge.com

BUSINESS RELIEF | ONLINE APPLICATIONS | INVESTOR FEE-FREE Capital at risk. Business relief qualifying trading companies are illiquid and unquoted stocks and therefore should be considered as high risk. Tax reliefs are dependent on individual circumstances, cannot be guaranteed and may be subject to change. Seek independent financial advice.

Issued by Deepbridge Capital LLP, a limited liability partnership registered in England & Wales, registration No. OC356449. Registered office: Deepbridge House, Honeycomb East, Chester Business Park, Chester CH4 9QN. Deepbridge Capital LLP is authorised and regulated by the Financial Conduct Authority (FRN:563366).

Welcome

Welcome to this inaugural Deepbridge Magazine. Over the years, as Deepbridge has invested into more early-stage companies it has become apparent that we have some great stories to share.

Speaking with investors and financial advisers, it has also been extremely reaffirming to hear that the stories of our investee companies are well received and, as one financial adviser described to me, “the interesting part of what we do.”

In this edition, you will find an interview with myself looking back at where Deepbridge began and what the future holds for Deepbridge. You will also find an insightful session with the heads of our technology and life sciences teams, as well as interviews with senior management of some of our investee companies.

I am extremely fortunate that we have a great team here at Deepbridge and I hope that, via this magazine, you will learn a bit more about our company culture, our family ethos and the personality of our team. It may well be a cliché, but the past twelve months have genuinely been unprecedented, no matter where you are in the world. However, innovators and entrepreneurs are often at the heart of any economic recovery and your ongoing support for such companies, via Deepbridge’s investment funds, has never been more important.

The impact of the Coronavirus pandemic is clearly putting existing and emerging businesses under severe pressure both operationally and financially. Whilst Deepbridge investee companies are not exempt from these global impacts, Deepbridge has curated two highgrowth focused, high impact EIS portfolios which include companies taking full advantage of the business opportunities that the pandemic has presented and many are, indeed, thriving as a result.

Thank you for your continued interest in Deepbridge.

Ian Warwick Managing Partner, Deepbridge

IMPORTANT INFORMATION AND RISKS Deepbridge investments are both illiquid and high risk, not suitable This document is provided for information purposes only and does for all investors and investors should not consider investing unless not constitute investment, legal, tax or other advice. In particular, any tax reliefs referred to in this document are for information they can afford the full loss of their investment. purposes only and based on our interpretation of current law.

This document is a financial promotion for the purposes of Section The application and value of potential tax reliefs depends upon 21 of the Financial Services and Markets Act 2000. The content of individual circumstances of each person, maybe subject to the document has been approved by Deepbridge Capital LLP. change in the future as a result of subsequent changes in law and This document does not constitute, and may not be construed as, therefore cannot be guaranteed. Prospective investors should take appropriate professional advice (including legal, financial and tax an offer or invitation to invest or make commitments pursuant to advice) before making any investment decision, no reliance should Section 21 of the Financial Services and Markets Act 2000. The information contained herein is subject to updating, amending and be placed on any information contained in this document, whether for investment purposes or otherwise and any decisions or actions verification therefore you should not rely upon it for any purpose. taken based on such information is the responsibility of the person Any investment in a Deepbridge proposition will be made solely taking that action or decision. on the basis of the respective product literature and customer Deepbridge Capital LLP is registered in England & Wales, Partnership agreements. Please be aware that past performance is not necessarily a guide to future performance and may not necessarily No. OC356449. Registered Office: Deepbridge House, Honeycomb be repeated. The value of investments may go down as well as up East, Chester Business Park, Chester CH4 9QN, authorised and and you could lose all or any of the amounts you originally invested. regulated by the Financial Conduct Authority (FRN: 563366).

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CONTENTS MEET THE FOUNDER

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2020 represented the tenth anniversary of the founding of Deepbridge Capital. It is therefore perhaps the perfect time to speak with Founder and Managing Partner, Ian Warwick.

MEET THE COMPANY: ZILICO

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Deepbridge has been providing funding to Manchesterbased Zilico Limited since 2016. We recently sat down and spoke with Zilico’s CEO, Sameer Kothari, to find out more about the company and the man at the helm.

ENJOYING CHESTER

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In this section, we share our team’s top tips for visiting a city or region. It is only natural that we start with Deepbridge’s home city of Chester. Our colleagues highlight some of their favourite places and things to do.

9 MEET SAMANTHA PIDDINGTON Sam is Head of Corporate Finance at Deepbridge. She tells us what her role involves, her background and how she’s been dealing with lockdown.

10 MEET THE COMPANY: VTIME

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Deepbridge investee company vTime is working on several exciting products using their virtual reality and augmented reality technology. We speak with vTime Managing Director, Clemengs Wangerin, to find out more about the company.

12 INSIDE THE WORLD OF EIS Deepbridge’s senior investment team look at the world of EIS and Deepbridge’s approach to sourcing and managing investee companies, whilst also looking at the post-Brexit world.

14 DEEPBRIDGE UPDATE The latest news from Deepbridge and our team.

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MEET THE FOUNDER

Ian Warwick, Founder & Managing Partner, Deepbridge

2020 represented the tenth anniversary of the founding of Deepbridge Capital.

Therefore, perhaps the perfect time to speak with Founder and Managing Partner, Ian Warwick, about the history and future plans for Deepbridge Capital.

Can you start by telling us a bit about your background prior to founding Deepbridge?

I proudly started out in the Royal Navy before a career in the oil business took me out to Houston, Texas. After the oil crash in 1986 I changed career and moved into advertising and worked with the Houston Rockets NBA basketball team. I then came back to the UK, built a career in the print industry, where I was the Sales Director of Europe’s largest printers. During this time, I spotted an opportunity and set up one of the first companies to manage and control the movement of digital assets, which eventually listed on Nasdaq.

we took, but asked why we were not using the Enterprise Investment Scheme (EIS)?

To which I replied, ‘What is the Enterprise Investment Scheme?!’ Therefore, after a lot of research, Deepbridge’s first EIS fund was launched in 2013.

This was then sold and throughout the process I met a number of individuals in New York who ran small cap funds and I went to work with them. I then spent a number of years working with growth focused or distressed tech companies with the objective of maximising investors’ returns.

I must also thank our brilliant investee companies for feeding our passion – it is these innovators that make our industry such an exciting and fulfilling place to be and they are the reason we do what we do. And finally, and most importantly, thank you to the financial advisers and investors who have supported Deepbridge and our investee companies.

How was Deepbridge founded?

In 2010, I was offered another role in California, after completing my most recent US role, however I turned it down as I had a young family and the time was right to be UK based. Initially, Deepbridge was founded with the aim to take my skill set, and several other individuals who I had previously worked with, and use these skills to work in a number of organisations rather than just one at a time.

Fresh to the UK after a long time working over in the US, we found prospective investors were happy with our investment methodology and the hands on approach

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Deepbridge recently celebrated its 10th anniversary, how does that feel?

The past ten years would simply not have been possible without the support of various groups, and for that I must firstly thank the Deepbridge team. We have built a fantastic team, with a great culture, which embraces opportunities and challenges with equal positivity.

Whether you have known us for years or are relative newcomers, it is your support, and your shared passion for what we do, that enables us to fund these great companies. In these strange times, we believe that it has never been more important to support early-stage technology and life sciences companies, so please continue to support Deepbridge and our investees. Due to the obvious reasons, our planned celebrations were postponed, and we now plan to make ‘11 the new 10’… so watch this space!

What is the Deepbridge ethos?

Deepbridge’s purpose is to provide a degree of comfort to investors by enabling them to invest alongside our team of passionate, experienced and fair-minded specialists. We have a genuine blend of people who know what it’s like to run a business and who have a balanced approach between being good investors, strong managers and practical operators.

We hope investors find Deepbridge to be a team you want to partner with and a team in whom you can place your trust internally. We also promote a culture of professional excellence and integrity which characterises all that we do.

Through this, we actively encourage our investee companies to achieve the highest standards of corporate governance.

We bring value to investee companies through our proven experience of building growth businesses, involving our network of investors, technology advisors, and industry partners.

What makes Deepbridge unique?

Deepbridge only operates in sectors in which the team has in-depth experience; technology, life sciences and renewable energy. This allows us to appreciate where, how and why our investee companies operate, giving us a better understanding of how to support, mentor and manage those businesses. With a proven track record of working with emerging companies, the Deepbridge investment team work closely with investee companies throughout their funding journey in order to ensure they have the very best opportunity to succeed and ultimately aim to provide our investors with an optimum return.

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We are also proud to say that we are one of the few EIS providers in the market who can offer reassurance to advisers that clients’ EIS subscriptions will be fully deployed the same tax year, with deployments usually taking place on a monthly basis.

What is your biggest achievement so far at Deepbridge?

It goes without saying that the innovate companies that we have supported have been a big achievement for Deepbridge.

We have provided over £160m of funding to over 100 companies that are truly having a positive impact the technology, life sciences and renewable energy sectors.

It’s a privilege to be involved in the development of innovative companies in the UK that hold true potential. However, to me, the biggest achievements for Deepbridge is the team that we have built over the years.

Australia and the US. Deepbridge would not be where it is today without each hardworking individual, and I hope to see Deepbridge grow even further throughout the coming years.

What is the most rewarding aspect of your job?

Working with great people. Whether that be the Deepbridge team, the founder and leaders of our investee companies or the advisers and clients who invest in our proposition.

Everyone we work with is committed to supporting growth-focused innovators and entrepreneurs, which makes it a fascinating sector to work in.

And finally, what does the future hold for Deepbridge?

Our main ambition is to continue to redefine growth capital, becoming the number one EIS provider in the market.

Despite the impacts of Coronavirus, Deepbridge remains in a strong position going forward.

We still have ambitious plans to grow the business over the next 3-5 years, by not only increasing our funds under management, but ensuring our existing and future companies continue to receive the best possible support.

As Deepbridge continues to grow, our propositions will continue to evolve with it. I am very excited about what the future holds for everyone at Deepbridge, our investee companies, our advisers, and ultimately, our investors.

“The past ten years would simply not have been possible without the support of various groups, and for that I must firstly thank the Deepbridge team.”

Today, Deepbridge has a team of over 40 people in offices across the UK,

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MEET THE COMPANY: ZILICO WITH SAMEER KOTHARI, CEO Deepbridge has been providing funding to Manchester-based Zilico Limited since 2016.

Deepbridge’s Ellie Thomas spoke with Zilico’s CEO, Sameer Kothari, to find out more about the company and the man at the helm.

Hi Sameer, great to see you. Could you provide our readers with a brief summary of your background?

I have over twenty years of experience within a commercial setting; including mergers and acquisitions, corporate strategy, business development and HR. My last fifteen years have been within the life sciences industry. Prior to joining Zilico, I ran another life sciences business which was venture capital backed. We had two rounds of funding, scaled up our manufacturing, launched our first product and then we were acquired by a large American Healthcare player. I am particularly proud that all nine products from this company that were in the development pipeline are now on the market, which is great to see.

So, how did Zilico begin?

Still today, many diseases are visually diagnosed. For example, for oral disease, patients will see a dentist when they have red or white lesions. However, it is extremely challenging for the dentist to tell whether the lesion is sinister or merely a normal ulcer that may self-resolve.

Similarly, for cervical disease, clinicians will apply acetic acid to differentiate acetowhite areas and then make a judgement on whether they think these lesions are precancerous or cancer. Visualization introduces a high level of subjectivity which becomes more challenging for clinicians especially when there are more subtle changes as seen in the early onset of disease. It was a professor at the University of Sheffield that came up with the idea of using the electrical properties of cells and tissue, which led to the genesis of Zilico. Essentially what

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Zilico’s bio-electric technology does is diagnose diseases as it progresses from normal to early-stage pre-cancer to laterstage pre-cancer (and cancer). Our lead product is ZedScan which is a diagnostic for oral cancer. Further products are now in development, such as a diagnostic for oral cancer, which utilizes the same core technology.

Could you give us an overview of where the company is up to?

We now have ten hospitals across the NHS routinely using ZedScan. These are essentially clinicians who are at the top of their game within the cervical cancer pathway. They have evaluated within a real world setting.

Not only is the efficiency of the device key but also its utility within a busy clinic where often there will be 10 patients waiting to be examined within 20-30 minute slots. It is essential for the device to work fast, efficiently and provide accuracy. We are starting to see expansion into Europe with two university hospitals in Helsinki, Finland now using the device.

The challenge with Europe is that the screening pathway in every country is subtly different and every healthcare system is different, so we need to understand each market individually.

We have also recently received a £1M grant from SBRI (NHS) to further develop prototypes for our oral cancer diagnostic.

We have already published promising proof-of-concept data for this device.

What support and infrastructure are there in the UK that means companies such as Zilico can thrive?

Specifically, for Manchester, I think it is the vision of creating clusters of life sciences researches and businesses.

The powers of clusters are that you have similar people that are grouping together, and it is not about competition, it is about likeminded people coming together. And that is what Manchester has done very effectively.

Is the UK seen internationally as the home for Life Sciences innovation?

Absolutely! I think if you look at the number of academic publications per capita then we are punching well above our weight. The UK is very good at research. The NHS is considered a fabulous organisation and therefore the first question we always get is, ‘are NHS centres using ZedScan routinely?’

To be able to say yes is a real stamp of approval.

The UK is thriving in the life sciences industry and I believe the North West has really been driving that for years. It is now being recognised, as companies are now moving to the North West, and you can really feel the story coming together.

What are the key factors that have enabled you to drive your business forward?

Having good people around you; whether they are mentors, sounding boards, board members, funding partners, etc. People capital is absolutely critical for me.

Listening to what each other have to say is crucial. You may disagree, but at least

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it means that you have gained another perspective.

The other key factor for young businesses, such as Zilico, is to have faith in what you are doing. In the medical and life sciences industry I believe we are lucky because it is evidenced and that is what really attracted me to Zilico when I first joined.

The initial proof of concept was published in the Lancet, a highly respected peer review journal. Growing a business is challenging and you need the motivation that comes from knowing what you are doing which can make a real difference. It is the strength of our proposition that is the reason we are still growing.

In terms of the people, how challenging is it to recruit the right people?

As a business grows it is essential to bring the right people with the right experience for the various roles. The life sciences community and the cluster of the North West has helped Zilico with our recruitment, and we believe we have been quite fortunate. We found recruiting reasonably straightforward around the North West and I believe it’s because we have got the regional skillset supported by academia, the NHS industry.

And finally, what excites you about the life sciences world?

It is about making a difference. Our mission for ZedScan is we want it to be part of the legacy of the eradication for cervical cancer, and we can see we are making inroads towards this.

Sameer Kothari, CEO, Zilico Limited

“When sourcing growth funding for Zilico, it was important that we partnered with an organisation that understands the medical technology sector. The Deepbridge team’s understanding of the commercialisation process of a company such as ours has been a real asset. As Zilico is headquartered in Manchester, the fact that Deepbridge is northwest-based is an added bonus.”

Sameer Kothari, CEO at Zilico Limited

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ENJOYING CHESTER In this section, we routinely share our team’s top tips for visiting a city or region.

Therefore, it is only natural that we start with Deepbridge’s home city of Chester.

Our colleagues highlight some of their favourite places and things to do when not in lockdown.

DAYS OUT… Chester Racecourse is the oldest racecourse still in operation in the world, with its first race meeting in 1539. One of the pioneers of racing at Chester was Henry Gee, who became mayor of Chester in 1539 and introduced an annual horse race meeting. Due to Henry Gee’s love of horse racing, his name became synonymous with racehorses, as today they are still often called ‘gee gees’.

With crowds of up to 20,000, the racecourse’s location in the heart of Chester makes for a colourful spectacle as those dressed in their finery make their way to and from the course. Phill Secrette, Head of Investor Services reflects, “if the weather is good, there is nowhere better to watch top quality sport. Chester is one of the great racing venues, whether in the ‘posh seats’ or watching the racing from the historic city walls.”

Gareth Groome, CFO, comments, “some cities have football or rugby at their core, but Chester is very much a racing city. The city comes alive on race day.”

With over 35,000 animals, Chester Zoo is one of the UK’s largest zoos and a leading international conservationist organisation.

In 2014, the story of the founding of Chester Zoo by George Mottershead in 1931 was told in the BBC drama ‘Our Zoo’.

Anjali Roberts, Strategic Partnerships Manager, praises the Zoo, “Chester Zoo offers a great family day out. We are extraordinarily fortunate to live so close to one of the best zoos in the world, but no matter how many times you visit, there is always something new to be amazed by.”

Sam Piddington, Head of Corporate Finance, added, “I’ve been a member of the zoo for almost 20 years now and it’s a wonderful place for a day out. My highlights would be the free-flying bat house, the beautiful orangutans and the incredible elephant enclosure just as you enter.”

The creation of the theatre, cinema, restaurant and library space that is Storyhouse created a cultural hub in central Chester and was formally opened

by Her Majesty The Queen and The Duchess of Sussex in 2018. Storyhouse is now well established on the circuit of the UK’s leading performers and artists.

Paul Bowman, Investment Manager, commented, “from comedians to Shakespearean productions, Storyhouse offers a fantastic repertoire of entertainment. It’s great to have a cultural home in the heart of the City.” Tony Lyons, Project Manager, continued, “attending the Christmas productions has quickly become a family tradition and Storyhouse’s outdoor summer performances in the park are highly recommended.”

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CHESTER RACECOURSE Horse racing The Racecourse Chester CH1 2LY www.chester-races.com ––– CHESTER ZOO Zoo and conservation Chester Zoo, Upton-by-Chester Chester CH2 1EU www.chesterzoo.org ––– STORYHOUSE Theatre, cinema and culture Hunter Street Chester CH1 2AR www.storyhouse.com

EATING OUT… For a City with a population of just 120,000, Chester has an abundance of eateries of all price ranges and styles. As a particular favourite pastime for most of the Deepbridge team, eating out is our specialist subject. Ian Warwick, Managing Partner, kicks off our review by highlighting his love (some might say addiction) for La Fattoria. Based on Lower Bridge Street, La Fattoria is an Italian trattoria which is synonymous with the vast majority of Deepbridge celebrations.

Ian comments, “whether it be one of Pasqualino’s pizzas, the calamari or traditional Saltimbocca, Fattoria is the home of great Italian favourites.”

“The Deepbridge Christmas Party would feel wrong if not held at La Fattoria. It is a Deepbridge institution. My particular favourite is the Ravioli Sofia, filled with lobster and crab, washed down with a glass of Brunello – perfect,” added Fuchsia Curry, Head of Private Client Marketing.

MAGAZINE Charlotte Johnson, Executive Assistant, adds, “the warm welcome from the team always ensures a meal starts off on the right foot, and makes you feel at home.

Most of us would agree that Ian treats it like home anyway!”

Another favourite of the Deepbridge team is Hickory’s Smokehouse on the banks of the River Dee. Terri Action, Relationship Manager, sings the praises of Hickory’s as an informal place to dine, drink and hang out with friends, “the great taste of an American smokehouse, coupled with an energetic vibe make Hickory’s a favourite.

Hickory’s location makes it a great venue to enjoy summer afternoons in the beer garden or winter nights in the bar.”

OUT OUT…

Natalia Grandini, Administration Executive, adds, “since moving to Chester, Hickory’s has become a firm favourite of mine. The steaks remind me of growing up in Brazil and the cocktails are dangerously good!”

If you’re not after a meal and would prefer liquid refreshment instead, then Chester is well stocked to keep you happy. The Deepbridge team share their thoughts on where to head for the best drinks in Chester.

Steven Powell, Regional Director, concluded, “although I’m based in Kent, for the Deepbridge online Christmas Party in 2020, we all received a ‘Hickory’s at Home’ food box delivered to our homes.

The food was amazing… and it lasted me several days!”

Joe Glaister, Administration Executive, offers 9 Elephants as a top eatery, “at the end of my first week at Deepbridge, we went for a team meal at 9 Elephants. The Thai food on offer is the best around and the restaurant is quirky in style.”

Lewis Tandy, Marketing Manager, adds, “the Massaman curry is fantastic and there’s also a great selection of Chef’s specials.”

LA FATTORIA Great Italian food 25 Lower Bridge Street Chester CH1 1RS www.lafattoriachester.com ––– HICKORY’S A taste of the Deep South The Groves, Souters Lane Chester CH1 1SD www.hickorys.co.uk ––– 9 ELEPHANTS A jazzed-up Thai experience 11a Upper Northgate Street Chester CH1 4EE www.9-elephants.co.uk

If you’re a fan of the pubs run by Brunning and Price, then you should visit Old Harkers Arms, the original B&P pub.

Set alongside the Shropshire Union Canal, on the ground floor of a former warehouse, “Harkers” offers a wide selection of real ales, wines and spirits.

A strict no-music policy means that the bar rings with the sound of conversation and the floor can be littered with resting dogs with their owners. Andrew Aldridge, Head of Marketing, comments, “Harkers is the type of pub where hours float by unnoticed. A great place to meet friends and put the world to rights over a pint of the local Cheshire Cat ale!”

Sandie Marshall, Finance Manager, adds, “the odd glass of wine in Harkers is the perfect way to unwind at the weekend, and a real miss during lockdown.”

If a livelier crowd is what you’re after, then Bar Lounge on Watergate Street is a must-go destination. A chilled vibe, great sharing platters and amazing cocktails makes Bar Lounge a favourite destination during the early evening and then the resident DJ turns the bar into a vibrant hub on weekend evenings.

Heather Hughes, Investment Co-ordinator commented, “the cocktails and the general vibe, make Bar Lounge a great place to enjoy a night out. The location also means it is a mecca on race days.”

Andrew Hughes, Head of Renewables, adds, “before lockdown stopped our fun, we’ve had many team nights out at Bar Lounge and everyone knows we’re in for a good night.”

Round the corner from Bar Lounge is the unmarked entrance to Prohibition, the Prohibition era themed bar. Ideal for small groups, prohibition takes visitors on a journey to the US of the 1920s, with classic cocktails, a dark and secretive atmosphere and hidden rooms. Ben Carter, Investment Manager, recommends, “the classic cocktails and secretive nature of having to knock on the door for entry makes Prohibition a unique experience – if you can find it.” George Siddorn, Investment Analyst, added, “a right little gem, if you manage to find it, but that is half the fun and separates those ‘in the know’ from those who aren’t!”

BAR LOUNGE Chilled vibe and cocktails 75 Watergate Streer Chester CH1 2LB www.barlounge.co.uk ––– OLD HARKERS ARMS Great ales, wine and spirits 1 Russell Street Chester CH3 5AL www.brunningandprice.co.uk/harkers ––– PROHIBITION A step into 1920s America Somewhere on Watergate Street Chester Shhh...Can’t say!

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Enjoy The Ultimate ‘BBQ In A Box’ Experience At Home!

Fire up your taste buds & fill your kitchen with the wonderful smells of BBQ as Hickory’s can bring the smokehouse to your house!

The pitmasters at Hickory’s have a created a menu packed with smokehouse classics, all smoked low ‘n’ slow in their ‘Ole Hickory smokers, then chilled & packed ready to be delivered to your door for you to heat & eat at home.

Build a custom BBQ box with 16hr smoked Texas style brisket, BBQ pulled pork & smoked chicken wings. Or go

nationwide Delivery!

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all out with The Family Platter that includes Memphis style ribs, BBQ pulled pork, mac ‘n’ cheese, Texas style brisket plus BBQ pit beans & house slaw.

The drinks are covered too!

Their team of bartenders have mixed up a selection of cocktails including The Game Changer & Cotton Candy. And, they’ve got their legendary grape soda and Hickory’s pale ale on the menu too.

They deliver nationwide and you can even choose next day delivery if you place your order

by 11am. You’ll get easy to follow heatin’ & shakin’ instructions and you can even download the Hickory’s playlist on Spotify for the ultimate at home experience.

So, whether you’re celebrating at home, treating the family or fancy a night watching the sport eating great BBQ food on the couch Hickory’s At Home is here ready for you to order online.

To order your Hickory’s At Home visit

www.hickorysathome.co.uk.

nationwide Delivery!

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MEET SAMANTHA PIDDINGTON Sam is Head of Corporate Finance at Deepbridge. She tells us what her role involves, her background and how she’s been dealing with lockdown.

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y role focuses on supporting investee companies prepare for further funding rounds or a potential exit.

This involves working with companies to ensure their business plans and forecasting is both professional but also accurate. As our investee companies move through our funding rounds, it is important that we work with them to be ready to take advantage of market opportunities as they present themselves.

Back in 2010, I was part of the Deepbridge founding team. Unfortunately, due to personal circumstances, I subsequently took some time out from my career but was delighted that Ian and the team kept the door open for me to return when the time was right.

When re-joining the team in 2019, it was great to see the success Deepbridge had achieved. Although the team had grown, the overarching ethos and culture remained. I’d say we are lucky to have such great colleagues, but I know that this is not luck, but is by design.

Prior to meeting Ian Warwick and starting Deepbridge, my experience was largely in corporate finance focused with a number of accountancy and City firms, including Andersen (now Deloitte) and Hawkpoint Partners (now Canaccord).

I actually met Ian in the school car park. Ian was working in New York but every Friday would be back in Chester to do the school run and that was how we started talking about what Deepbridge could become.

The aspect I love most about my role is witnessing first-hand the progress our investees are making. By the time I get involved with companies, they are generally well established with considerable commercial traction.

I love seeing how Deepbridge, and our amazing investors, have supported innovators take a company from an early-stage (in some cases from our SEIS funds, which are often investing at an embryonic stage) to employing large teams and gaining international traction.

I’m excited about 2021 as we have a number of our EIS companies now attracting significant interest from co‑funders, blue-chip clients and prospective acquirers. It is inspiring to see that between them, our portfolio companies are engaged with organisations such as Coca-Cola, Disney, Astra-Zeneca, Twitter, LinkedIn, Microsoft, the NHS, HMRC, T-Mobile, Schneider Electric, the US Navy, Sharp, City Football Group, Diageo... and many more.

On a personal note, lockdown over the last twelve months has been tough for everyone but I am blessed to have my brilliant two daughters, who are also my best friends, with me whilst also having great friends, neighbours and colleagues.

Mental health awareness has never been more important. From the top of the organisation down, it has been great to see colleagues look after each other during lockdown; launching a book club, hosting regular quiz nights, opening the virtual Deepbridge pub, catching up with one another for socially distanced walks or taking part in the Deepbridge Challenge.

Our Friday morning team Zoom meetings are called the Deepbridge Family Friday Meeting, and that family feeling is what makes the Deepbridge team unique - it doesn’t matter whether colleagues are based in Chester, London, Ireland, the USA or Australia.

I live in a lovely part of the world and am fortunate to be able to get out and enjoy the countryside most days. And with the regular Deepbridge quiz nights and our village trivia nights, I’m pretty much quizzed out... but I must’ve learned something along the way!

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MEET THE COMPANY: VTIME

WITH CLEMENS WANGERIN, MANAGING DIRECTOR AT VTIME

Deepbridge investee company vTime is working on several exciting products using their virtual reality and augmented reality technology. Ellie Thomas spoke with vTime Managing Director, Clemens Wangerin, to find out more about the company.

What is vTime? vTime is a company that completely changes the way people communicate and engage with each other using digital immersive technologies including augmented reality and virtual reality. Our products, like vTime XR, work across all the devices that people use to access these new technologies, including mobile, and very soon we will also be available on tablets, laptop/desktop PCs and Mac’s.

Martin’s foresight saw a lot of opportunity in the virtual reality and augmented reality markets and Martin was in the unique position where he could make it happen.

He took the opportunity to take the best talent from the gaming and entertainment industry and put them together into this emerging sector. He initially invested his own capital to bring myself and the rest of the team together and give us the freedom to start innovating from day one.

How important has ‘people capital’ been when building a business such as vTime?

For us it was crucial in the formative stages of the business. Although Martin’s involvement was key in terms of bringing capital to the mix, an idea is still only an idea until you execute it! For that you need people who are at the top of their game and can consistently perform at a professional level.

What was your background before vTime?

I, like many of my colleagues at vTime, have been in the video games industry since the early 90s when it was still in its infancy. I worked at Sony PlayStation for 15 years and ran their software development studio in Liverpool. I grew that from 40 people to 120 people whilst developing numerous racing games, including Wipeout and Formula One, two franchises synonymous with PlayStation history. I left Sony about ten years ago because I wanted to get involved in the start-up scene and become an entrepreneur. In the five years prior to vTime I was involved with several startups. I got heavily involved in the local start-up eco-system and really immersed myself in that because that is what I had passion for and therefore I wanted to turn it into something a bit more tangible.

What are vTime’s products? ‘vTime XR’ is a free application that consumers can download from a wide range of app stores, including Apple’s app store, Google Play etc. When users first download the app, they create an account and very quickly can enter one of the many beautiful virtual destinations that are included within the software. Users can connect with each other globally, and people use it primarily for communication and social engagement with each other.

At the start, we were quite fortunate that we were in a position where we could pull together a very strong team in a short period of time. Our first year we grew from four to twenty-five highly qualified and experienced people. What we found was, once we had our core, we also needed a lot of new blood, therefore recruitment is something we spend a lot of time on as it is a key part of what makes a great team.

Having the right mix and skillset is key for a successful business.

Our newest product, ‘vTag’, is a consumer app that offers users the ability to create captivating 3D avatar messages using their voice, face and body movements.

They can then either; send these messages directly to their friends through our app; post the message directly to one of the popular social media platforms; or, uniquely, pin the message on a map to leave in a specific physical location where it can be found by others.

What milestones are you most proud of at vTime?

For us I think the milestones are about our productivity. Although our first product came into the market in December 2015, we have updated it hundreds of time since then. Therefore, it is constantly evolving. We are knowledge intensive and innovation driven, although we do like making something tangible at the end of it. The products we are putting out there in the market are important steppingstones to take us towards recurring revenues and get to the point in the future where we think the consumer level and adoption level of technologies reach a critical mass.

vTime was founded by successful software entrepreneur Martin Kenwright. Martin decided that although he had previously successfully exited two game development studios, he wanted a new challenge.

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We are also working with commercial partners to develop partner-specific content in the sports, leisure, tourism, and corporate sectors.

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What’s next for vTime?

The next phase for vTime is to build on our position within the industry. What we have shown so far is only the beginning.

Our plan, ambition, and opportunity to scale are unprecedented. We truly believe we have the right people and the right resources to deliver this.

What does the future of VR/AR and other immersive technologies look like?

The impact immersive technologies have on how we engage with computing is fundamental and creates a shift in what is possible today. Over the next few years, we will see these enabling technologies take on more acceptable, even desirable, form factors when it comes to the physical products like wearable AR glasses or lightweight HMDs that are used in conjunction with software like ours. Furthermore, the advent of 5G, Edge Computing and the AR Cloud (a 1:1 digital 3D copy of the world that enables persistent and super accurate placement of digital objects in the real world), will bring about a new generation of applications that will allow people to exist in multiple realities and seamlessly transition between them. At that point, we will have taken another significant step towards the Metaverse of tomorrow.

What advice would you give to an early entrepreneur?

Just to understand that everything takes three times longer than you think it will.

Also, just do it! That is ultimately what I did 10 years ago when I decided to have a change in career. At the end of the day you must walk the walk to be able to talk the talk!

“The key problem we wanted to solve with vTime XR was a new type of shared experience that really made people feel connected with each other when they are online. We decided to focus on communication and finding a new and unique way to communicate, initially in VR but then to expand into AR and ultimately to traditional 2D flatscreens. It was important that we partnered with a funder that understands our approach to commercialising what was effectively an entirely new concept company. Deepbridge’s experience of supporting tech innovations was important and a key attraction for us.”

The vTime XR app can be downloaded from: Apple App Store, Google Play, Oculus Store and the Windows App Store. vTag can currently be downloaded from the Apple App Store in the UK only.

Clemens Wangerin, Managing Director, vTime

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INSIDE THE WORLD OF EIS Investing in early-stage companies should be considered as high risk, but utilising the potential tax reliefs available under the Government’s Enterprise Investment Scheme (EIS) can make such investments particularly appealing.

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llie Thomas sat down with Adrian Neilan, Chief Operation Officer & Investment Director, Technology, and Dr Savvas Neophytou, Partner and Head of Life Sciences.

Firstly, Deepbridge’s EIS funds invest in companies in two specific areas – technology and life sciences - what excites you about them?

Adrian Neilan (AN): Technology is a very broad term and I think people can get confused about different kinds of tech. The key thing is that you focus in on sectors where you feel you can contribute.

I know everyone gets excited about the huge listings that we see for multiplebillion dollars, but they are few and far between – although it’s great if you get one. It’s about focusing in on disruptive technologies that you can develop and exit.

Dr Savvas Neophytou (SN): Life Sciences is also broad, and you have to put it into sub-sectors in order to describe the attributes of each one, in terms of investment opportunities. In general historic terms, about 10% of GDP is spent on healthcare – it’s much more in the US, up towards 20%. Certainly, if you have disruptive technologies coming and taking part in that, it’s very easy to see how you could potentially make some good returns.

Where does Deepbridge find its investee companies from?

SN: What makes a good investment house is having that proprietary pipeline.

Now we have built a pipeline and a lot of investment opportunities come and find us. We get about a thousand opportunities within any given year. So, for example, we’ll get warm recommendations from

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people we’ve already worked with and been successful with. We’ve broadened our reach – we have a network ‘scouting’ for opportunities not just here but in the US, in Australia, Poland, Germany, for example.

AN: When we talk about deal-flow, we should remain agnostic in terms of relationships, in that we don’t want to be tied, or take a deal, from a particular institution because they feel we should, and we feel obliged to.

What are the key criteria you look for in investee companies?

SN: One of the first things we look at is the management team, are they knowledgeable and strong. We also look at the areas that they are focusing on, which need to be scalable opportunities.

Intellectual property (IP) is also important – it could be existing IP that can be spun out of academia, etc., or IP we think the Company can generate. The product or service the Company is working on needs to be about providing a solution to an existing problem or disrupting an existing marketplace.

AN: There must be a degree of commercial reality in terms of what you’re trying to achieve. Ultimately, we’re about generating returns on investment, so we wouldn’t get involved with a service for a particular parochial area or region, or a medical area which only has 1,000 people who suffer from that problem. We have to leave that to others. The global scalability and the potential to move into multiple vertical markets will drive a more significant valuation ultimately.

And what do you think Deepbridge offers that other EIS investment managers don’t?

AN: We recognise that for a lot of companies, with the stage they’re at, it’s not just about receiving the funding.

I think what drives a lot of companies to Deepbridge is that we are actively involved in assisting them in building their businesses. They value the fact that we are a team of experts which can provide the help to leverage their businesses. If you just put the money in, you’ve got a reasonable chance you’re going to lose your money.

SN: Young businesses need hands-on, operational experience and that’s what we provide. They know that they have our support and we help them overcome many problems they may have. We have open communication with all our companies. We operate in terms of the three P’s in terms of communication – they tell us what progress they’ve made, what problems they have, and the plans in place.

AN: A good example would be a company we invested in called AlgaeCytes.

AlgaeCytes is a company whose proprietary technology creates Omega 3 from fresh water algae, compared to historic Omega 3 production being predominantly sourced from fish stocks.

The Company has excellent technology and scientific research but was struggling to commercialise as quickly as we would like, or to the scale we wanted. We therefore have worked closely with the senior management team to restructure the business and team in order to accelerate commercialisation. The Company is now working on its first largescale production site and has largely pre-

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sold the first year’s production. Significant interest from blue-chip clients add considerable validation to our approach and we look forward to the exciting next steps. A passive investment manager would likely have missed that opportunity and not been able to assist the Company.

What are the key attributes that you look for, or that you think make, a good entrepreneur?

AN: I like to see business founders who have experienced success during their career, who are diligent, who are willing to go the extra mile and put everything on the line to achieve what they want to achieve. You can’t educate someone to be an entrepreneur; you’re either an entrepreneur or you’re not.

SN: Early-stage businesses don’t move in a straight line, so you need the team to have adaptive intelligence. So, for example, it can be very difficult to move from academia to a commercial set-up – again, this could be where a hands-on manager such as ourselves is imperative.

And what about your thoughts on the UK EIS market in general?

AN: The rule changes that were made (following the Patient Capital Review) were significant and something we’d advocated. We completely buy-in to the concept that a pound invested is a pound at risk, and that there should be a focus on ‘knowledge intensive’ companies.

Without necessarily wishing to be, we’ve been thrust to the forefront of the market, with our focus having always been on the inherently knowledge intensive tech and life sciences sectors. EIS, managed well, is an exceptional product. Indeed, the EU’s review of such schemes around the globe, in 2017, was that of the top four tax-efficient products on the planet, three of them were VCT, EIS and SEIS, which is quite remarkable for a country our size.

There’s a dynamic environment in the UK which has been created over the past 20 years. There are incubators in every town in the UK, almost every university has a commercialisation department. We are seeing a greater interest in overseas companies coming to the UK because of the access to funding.

I guess the not-so-little elephant in the room is the Coronavirus pandemic?

AN: There’s no getting away from the fact that the pandemic has affected everyone in some way. EIS fundraising naturally suffered a dip during the early days of lockdown, but on the whole we are pleased to see investors continuing to support early stage companies, which is probably down to two reason; the first being that they still have a tax bill they wish to reduce and secondly, they see the opportunities which innovative early-stage companies are able to take advantage of. Ultimately, our investment criteria mean that our technology and life sciences companies are expected to be highly innovative and therefore we believe there should remain a genuine need for their research, development and/or products. We remain in unprecedented times but I am reassured that Deepbridge’s investment style of providing hands-on support to investee companies will stand us in good stead and has never been more important.

Adrian Neilan Chief Operation Officer & Investment Director, Technology.

SN: In the life sciences sector, there are opportunities for innovative companies to support the healthcare effort and thereby take great steps forward as a business.

Where there are companies that don’t have the same positive opportunities then, as Adrian alluded to, it is our hands-on approach that allows us to work proactively with investees to help them best manage their business through difficult times.

And, finally what about the future, post Brexit?

AN: The UK Government will have to find ways of filling the gaps left by the funding which has traditionally come from the EU. They won’t necessarily want to find that out of their own pockets so they will continue to provide incentives for individuals to provide funding for the kind of businesses we invest in – EIS and SEIS will continue to be increasingly important and relevant.

SN: We need to be aware that there are going to be some structural changes that are going to take place and one area we don’t know about yet is what will happen to funding at universities? Is that going to slow down? These are relevant but we are confident as a business that we can find the innovators starting businesses wherever they might be.

Dr Savvas Neophytou Partner and Head of Life Sciences.

“Life Sciences is also broad, and you have to put it into sub-sectors in order to describe the attributes of each one, in terms of investment opportunities.”

Dr Savvas Neophytou

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DEEPBRIDGE UPDATE The latest news from Deepbridge and our team.

COVID-19 RESPONSE It would be remiss of us not to reflect on our response to the Covid-19 pandemic.

Our initial response was to immediately assess our investee companies and the potential impact of a global healthcare and economic storm.

We quickly identified that our portfolio companies would fall into one of three categories; • those which are providing an important innovation to either aim to assist with the healthcare crisis or to assist economic efforts and therefore would have opportunities to potentially benefit from this scenario; • those which, as young and therefore agile companies, should be able to effectively ‘hunker down’ and reduce cost until economic improvements enable them to continue their growth plans; • and those which would struggle and may ultimately fail.

REGULATORY PERMISSIONS We are delighted to report that the Financial Conduct Authority has granted Alternative Investment Fund Manager status to Deepbridge Capital LLP, FRN 563366.

Deepbridge Capital LLP has therefore, from December 2020, replaced Enterprise Investment Partners LLP (‘EIP’) as Investment Manager for all retail client participations in the Deepbridge products.

We thank our friends at EIP for their support and assistance over recent years, as we look forward to this next exciting stage of the Deepbridge journey.

SYSTEMS AND ACCESS We are currently concluding an extensive internal project to transition to a new back office system. As well as creating internal efficiencies, transitioning to use the Libris Exact software for our administrative processes will also allow us to offer financial advisers and investors access to a bespoke portal.

We shall be rolling this out in 2021 and look forward to providing our adviser and investor communities with extraordinary access to documents, portfolio updates and transactional information. We hope this will help us on our long-standing objective to provide the most proactive and transparent service levels possible.

Our investment teams continue to work tirelessly with our investee companies to help them, to support them in taking strategic decisions and to assist them with identifying potential opportunities.

We continue to work closely with the senior management teams, but are thus far reassured that those in the latter above category are very much in the minority.

Ultimately, our investment criteria mean that our technology and life sciences companies are expected to be highly innovative and, therefore, there should remain a genuine long-term need for their research, development and/or products.

We are not yet in a post-Covid world, but we are reassured that Deepbridge’s investment style of providing hands-on support to investee companies continues to stand us in good stead and has never been more important.

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AWARD We were delighted to receive the Team of the Year Award at the 2020 Growth Investor Awards. We are extremely proud of our people at Deepbridge and this award exemplifies their great work during a testing time for the world as a whole.

We couldn’t be prouder.

TEAM OF THE YEAR

IT ACTUALLY IS ROCKET SCIENCE. Deepbridge’s EIS and SEIS funds invest in growth-focused innovative technology and life sciences companies.

Deepbridge’s team of sector experts invest across a wide range of sub-sectors, offering hands-on management support to great teams seeking to deliver an intellectual property driven solution… and yes, this could actually include rocket science!

Investors can access the potential future technologies of tomorrow whilst benefiting from the generous tax reliefs available via the UK Government’s Enterprise Investment Scheme and Seed EIS.

www.deepbridge.com

EIS MONTHLY DEPLOYMENTS | ONLINE APPLICATIONS | INVESTOR FEE-FREE Capital at risk. EIS and SEIS investments are illiquid and unquoted stocks and therefore should be considered as high risk. Tax reliefs are dependent on individual circumstances, cannot be guaranteed and may be subject to change. Seek independent financial advice.

Issued by Deepbridge Capital LLP, a limited liability partnership registered in England & Wales, registration No. OC356449. Registered office: Deepbridge House, Honeycomb East, Chester Business Park, Chester CH4 9QN. Deepbridge Capital LLP is authorised and regulated by the Financial Conduct Authority (FRN: 563366).

Tel: +44 (0) 1244 746000 Email: info@deepbridgecapital.com www.deepbridgecapital.com

Deepbridge Capital LLP is registered in England & Wales, registration number OC356449. Registered Office: Deepbridge House, Honeycomb East, Chester Business Park, Chester CH4 9QN. Deepbridge Capital LLP is authorised and regulated by the Financial Conduct Authority (FRN: 563366).

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Deepbridge Capital LLP Deepbridge House Honeycomb East Chester Business Park Chester CH4 9QN