Portfolio February 18 2020

Healthcare company Novacyt launches new coronavirus test

Novacyt, a global specialist in clinical diagnostics, is pleased to announce that its molecular diagnostic division, Primerdesign, has launched its CE-Mark molecular test for clinical detection of the new coronavirus (COVID-19). Directors say Primerdesign’s COVID-19 test is the first CE-Mark test for the 2019 strain of the new coronavirus and follows the company’s rapid launch of its single-use research coronavirus (RUO) test on 31 January 2020. Thanks to the CE marking, the company’s COVID-19 test can be used directly by laboratories and hospitals to test patients without needing to be validated by clinicians. The company anticipates an increase in demand for its COVID-19 test due to this expanded use for clinical diagnosis. Primerdesign has already received quote orders for 288,000 CE marked tests since they were pre-ordered on February 14, 2020. The company has received orders for 40,000 RUO tests and requests for quotes for 35,000 additional RUO tests before the launch of the clinical version of the test for COVID-19. The demand for these tests has come from China, the United States and the United Kingdom, as well as many other countries around the world. The company continues to see a high conversion rate from quotes to orders. However, it is difficult to predict how the demand for this test will increase, as we are still in the early stages of the epidemic. Since the first reports of COVID-19, the company has invested in its manufacturing capacity to meet current and potential future demand for its tests. The Primerdesign test is currently being officially evaluated by public health authorities in five countries and the company is in discussions with these organizations to possibly support their national requirements for COVID-19 screening. As previously announced, the company has submitted an application to the U.S. Food and Drug Administration (FDA), with which it is still in discussions, for Emergency Use Approval EUA approval of its COVID-19 test. , which would allow US laboratories to use the test for clinical diagnostic purposes on a temporary basis. The data generated by the approval of the CE marking will be used to support this request. Graham Mullis, CEO of Novacyt said: “I am very pleased to announce the launch of our COVID-19 CE-Mark test, which we believe is the first CE-Mark test for the clinical diagnosis of the 2019 strain of the new coronavirus. Like our disposable research test, it can produce a result in less than two hours, with the added efficiency of being able to transport the test at room temperature, eliminating the need for cold chain transport. It is designed to work on multiple instrument platforms commonly used by clinical laboratories around the world, ensuring that our COVID-19 test can be used by as many clinicians as possible. We look forward to continuing to support clinicians in the fight to contain the spread of the new coronavirus during this public health emergency. “

Portfolio February 13 2020

Butternut Box receives significant strategic investment from L Catterton Europe

Butternut Box, the leading fresh food delivery brand for dogs in Europe, today announced that it has received a significant strategic investment from the European fund of L Catterton, the largest and most global consumer-focused private equity firm. L Catterton will partner with Butternut's team to accelerate the company's growth. Founded in 2016, Butternut is the leading human-grade, cooked fresh dog food company in Europe. Butternut's highly personalised dietary offering and digital approach enable customers to experience a new category of fresh, healthy dog food with unsurpassed quality, convenience and affordability. The investment is expected to support Butternut's operational enhancements as well as its growth and diversification in existing and new channels. "Butternut is driven by our founding purpose of delivering health and happiness to dogs and their humans all over the world. With L Catterton's support, we will accelerate investments in supply chain, manufacturing, marketing and new offerings in order to expand our base of customers who love feeding their dogs with personalised, nutritional and delicious meals and treats," said Butternut Co-Founder Kevin Glynn. "We are excited to be partnering with L Catterton. By leveraging L Catterton's deep customer insights, global network and vast experience with pet food brands, Butternut will be able to bring our caring, health-conscious and data-driven approach to dog food to more customers than ever before," added Butternut Co-Founder David Nolan. "Over the past four years, Butternut has established a very strong base of loyal customers in the U.K. through an innovative digital platform, playful customer engagement and fresh, high quality products," said Jean-Philippe Barade, Partner, L Catterton Europe, and head of the Firm's London office. "We believe Butternut has a significant opportunity to expand further in a rapidly growing category and is well positioned to benefit from strong consumer trends among pet owners, including the increasing demand for high quality ingredients, healthier choices and personalised offerings. We look forward to working with Kevin, David, the talented Butternut team and all existing investors whilst leveraging L Catterton's industry expertise to realize the immense potential of the brand." L Catterton has significant experience investing in the pet food and pet care categories, with current and past investments including Ainsworth (the parent company of the Nutrish brand), Iandloveandyou, Inspired Pet Nutrition, Just Food For Dogs, PetVet Care Centers, Nature's Variety and Wellness Pet Food. White Star Capital and Five Seasons Ventures continued to support the company and also participated in the investment round. The exact terms of the transaction were not disclosed. Butternut was advised by Houlihan Lokey and Orrick, and L Catterton was advised by Mayer Brown.

Portfolio February 11 2020

Music streaming pioneer SoundCloud raises $75m from Pandora owner SiriusXM

SoundCloud, the music streaming company that has been described as the “YouTube of audio” because of its profusion of user-generated content, has some big, strategic investment news today. The company has raised $75 million in funding from satellite radio giant SiriusXM, owner of streaming giant Pandora, which has an ad partnership with SoundCloud. The funding will be used towards product development and launching new services, the companies said in a statement. We’re asking what the valuation is with this round and will update when and if we hear more. According to PitchBook, SoundCloud  was last valued at $500 million back in 2017. SiriusXM describes the deal as a minority investment that is related to the ad partnership in which Pandora resells SoundCloud’s inventory on its programmatic platform. Together the two serve an audience of 100 million unique listeners in the US, the company said, and SoundCloud hit a forward revenue run-rate of $200 million for the first time in the fourth quarter of 2019. The deal with SiriusXM is a positive development for SoundCloud and could represent a reversal of fortunes for the business. Originally founded in Berlin in 2007 — one of the early movers in music streaming startups that also saw the rise of Spotify — SoundCloud has seen some significant ups and downs in its life. Reportedly once an acquisition target for Twitter and later Spotify, the company never quite converted those talks into deals, in part because of the asking price and the overhang of licensing issues and related business models. Indeed, as an independent startup — and despite its surge of viral popularity and obvious street cred with a long roster of creatives using the platform to try out new things and send their songs and other sound-based work into the world — the SoundCloud of yesterday never really managed to surmount the licensing and larger monetisation issues that all streaming companies face, despite raising a hefty $404 million in funding before today. Close to running out of money at one point, it restructured, laying people off, with one founder, Alex Ljung, stepping down as CEO as it raised emergency funding (he is still chairman), and the other co-founder Eric Wahlforss leaving last year. It’s been a much quieter business in recent years as a result. But even as it has laid low, it has continued to grow, and this deal is evidence that it’s definitely not done for yet. “SoundCloud’s three consecutive years of strong financial performance directly reflect the success of our creator-led growth strategy,” said Kerry Trainor, current CEO of SoundCloud, in a statement. “We have an exciting roadmap focused on deepening the connections between creators and listeners that fuel creator discovery, career growth and the evolution of music culture on SoundCloud. We’ve built a great relationship with SiriusXM through our highly successful Pandora ad sales agreement, and their investment gives us added capital flexibility to accelerate our vision and take advantage of strategic opportunities as they arise.” It’s a tempting thought to wonder if this could convert into an acquisition of SoundCloud by SiriusXM. Indeed, it does provide a complement to Pandora and potentially fills a gap both for international audience — over 200 million tracks from 25 million creators with listeners in 190 countries — and also more original content. Those who have used the platform to debut original music include Billie Eilish, Post Malone, Bad Bunny, Khalid and Lil Tecca. “SoundCloud’s unique platform serves a vital role in today’s music ecosystem where new artists are discovered and build their fan base, and established artists experiment and connect directly with their fans in highly effective ways,” said Jim Meyer, Chief Executive Officer of SiriusXM, in a statement. “We admire SoundCloud’s loyal and growing audience, its offering for creators, and its reputation and popularity in global music communities. We believe this is another opportunity to continue creating value for SiriusXM stockholders by investing in expanding digital audio platforms.” No word on any exits in today’s announcement, of course, but what we can see is that SoundCloud has bought more time, and has more strategic buy-in now, for its future.

Portfolio February 11 2020

Inotrem expands Series B financing to €58m with a mix of equity and debt, adding new investors Fountain Healthcare Partners, Kreos Captital and Bpifrance

Inotrem S.A., a biotechnology company specialized in the development of immunotherapies targeting the TREM-1 pathway with potential applications for acute and chronic inflammatory syndromes, announced a €5M capital increase financed by Fountain Healthcare Partners, a leading Irish venture capital firm with offices in Dublin and New York. This fundraising brings Inotrem’s Series B financing to a final closing amount of €44 M. In addition, the Company secured a €13 M credit line from Kreos Capital, Europe's largest provider of specialty finance to growth companies, and a €1 M loan from Bpifrance, France’s public investment bank, bringing the fundraising to a total of €58 M of equity and debt. The financing will support Inotrem’s R&D effort, in particular of its lead drug candidate, nangibotide, which is currently undergoing a global multicentric Phase IIb trial in septic shock patients (ASTONISH trial) in 5 European countries and the United States, and of a companion diagnostic tool aimed at selecting those septic shock patients that are more likely to respond favorably to treatment. Financing will also allow the Company to expand its TREM-1 franchise to address chronic inflammatory diseases. "With Fountain Healthcare Partners joining our pool of world-class investors, Inotrem is in an ideal position to advance its market-breaking technology platform centered on the TREM-1 pathway and bring new immunotherapies to patients and the medical community" said Jean-Jacques Garaud, CEO of Inotrem. Based on a novel approach of immunomodulation which targets the TREM-1 pathway, Inotrem has developed a proprietary technology platform and leverages its extensive knowledge of the TREM-1 pathway biology to develop programs in several indications with inflammatory syndromes for which there is a major and today unsatisfied therapeutic need. Its lead compound, nangibotide, targets septic shock which is the ultimate complication of sepsis. The incidence of septic shock continuously raises and mortality remains elevated (35%) in developed countries. There is currently no specific mechanism-based therapy approved for this indication. Inotrem’s solution has the potential to become the first mechanism-based treatment for septic shock. "Inotrem has demonstrated its ability to reach several critical milestones and we are delighted to back this team. The TREM-1 pathway is extremely compelling and has great potential to bring solutions to patients that today lack effective therapies", indicated Ena Prosser of Fountain Healthcare Partners. In conjunction with the financing, Ena Prosser of Fountain Healthcare Partners will become a member of Inotrem’s Board of Directors, and Aris Contantinides of Kreos Capital will become an observer on Inotrem’s Board of Directors.

Portfolio February 10 2020

BioCatch expands digital identity leadership position with AimBrain acquisition

BioCatch, the global leader in behavioral biometrics, today announced it has acquired AimBrain’s multi modal biometric authentication platform for an undisclosed amount of cash. AimBrain's platform combines several distinct methods to detect potential fraud, including behavioral biometrics, anomaly detection and other biometric modalities, to support various use cases in the digital identity lifecycle, including step-up user authentication to comply with KYC, AML, PSD2 and other regulatory requirements. The AimBrain technology complements and deepens BioCatch’s solution as the company extends its leadership in digital identity, where enhanced fraud detection and better user experience are critical to meeting the evolving needs of banks and other financial institutions seeking to protect their clients’ assets. As part of the acquisition agreement, the AimBrain team will join the highly-regarded BioCatch team, accelerating the company’s ability to execute on its ambitious growth plan. “This is a very exciting development for us,” said Howard Edelstein, Chairman & CEO of BioCatch. “AimBrain’s people, technology and intellectual property will expand our capabilities considerably and help us extend our lead in the market as we aim to continue our rapid growth in 2020 and beyond.” BioCatch owns more than 40 patents and has another 25 pending. AimBrain’s intellectual property will add another 4 patents to its holdings. The company’s next-generation behavioral biometrics platform passively collects over 2,000 parameters of physical and cognitive user interactions across both web and mobile channels. By analyzing these parameters in context, BioCatch extracts powerful online behavioral insights and applies them to various use cases across the digital identity lifecycle. These use cases include detecting stolen or synthetic identities in account onboarding, authenticating users at login, detecting fraudulent account takeover attempts, and recognizing increasingly sophisticated social engineering scams. “The fraud detection and authentication industries are rapidly consolidating, and we believe that combining forces with the leading global behavioral biometrics player at this time makes tremendous sense, both for ourselves and our clients,” said AimBrain CEO Andrius Sutas. “Together, we will be able to pursue broader applications, particularly in the mobile arena which requires deep understanding of fraud behaviors and a way to allow legitimate users to transact unencumbered. We are very excited about the possibilities and to be joining the BioCatch team.”