NetScientific Plc, the deep tech and life sciences VC investment group, announces that its portfolio company Ventive has successfully closed a c.£900,000 investment.
The Investment included £316,000 from existing shareholders and the conversion of two existing convertible loans (and interest thereon) valued at c.£600,000. This is the first closing as part of Ventive’s proposed £1 million to £1.5 million investment program, with further new investment anticipated prior to 30 April 2024 in one or more additional closings.
Net zero HVAC systems
This additional funding is complemented by ongoing non-dilutive funding from, among other grants awarded, a £1.5 million BEIS grant secured in 2022, as well as a recently awarded £100,000 UK Government grant focused on ‘net zero HVAC’ systems.
Value creation team of EMV Capital has worked with Ventive to stabilize and develop its business planThe Investment was led and syndicated by EMV Capital, the Company’s wholly-owned venture capital and corporate finance firm. It follows the initial investment led and syndicated by EMV Capital that was announced (via RNS Reach) on 20 October 2022, where EMV Capital secured an initial c.16% stake in partial settlement of its fees. Since that initial investment, the value creation team of EMV Capital has worked closely with Ventive to stabilize and develop its business plan and product range.
Ventive’s modular heat pumps
The proceeds of the Investment will support the completion of the design and test phase and factory build for Ventive’s modular heat pumps, further enhancements to its passive air ventilation product range, and build-up of its marketing and sales capacity to drive sales of its existing product range. The Ventive balance sheet is also streamlined following the conversion of the convertible loans.
Ventive balance sheet is also streamlined following the conversion of the convertible loans
Following the completion of the Investment, the total equity holding of the NetScientific group in Ventive is 11.0% on a fully diluted basis, which includes the partial settlement of its corporate finance fees relating to the Investment. This holding equates to a post-investment fair value of £893,000, a substantial increase of 1,617% from the £52,000 reported as of 31 December 2022. In addition, following the introduction of investors to Ventive by EMV Capital under its capital efficient model, NetScientific’s capital under advisory with Ventive is now 23.8% of the fully diluted share capital.
Ventive's passive air ventilation system
Ventive designs and manufactures intelligent heating and ventilation solutions to make buildings healthy, comfortable, efficient, and affordable. Its products address two high-priority market segments: air quality and sustainable heating.
Ventive's passive air ventilation system has been delivered to over 30 schools and five leisure centers, achieving excellent air quality results. Its novel heat pump product, which is in advanced stages of development, is a comprehensive solution for residential applications, with a unique modular design and a novel thermal store. Momentum for the business is underpinned by significant regulatory changes, increasing energy prices, and climate change policies.
Efforts and growth strategy planning
This investment is a strong endorsement of our work, and recognition of Ventive"
Rob Morrison, Managing Director of Ventive, said: “This investment is a strong endorsement of our work, and recognition of Ventive as a pioneer in the design of naturally intelligent ventilation systems to deliver fresh air at minimal energy cost. Since heat pumps are powered by electricity, a comparatively easy source of energy to decarbonize, they can play a prominent role in bringing down the environmental footprint of homes and other buildings."
“EMV Capital has provided invaluable support to our fundraising efforts and growth strategy planning, and we are grateful to our shareholders for their continued support in a tough macro-economic climate.”
Author's quote
Edward Hooper, Executive Director of NetScientific and Investment Director at Ventive, added: “We are pleased to see Ventive close out the first tranche of this important fundraising program, which includes both fresh investment and the conversion of existing convertible loans. This transaction again demonstrates the strength of our capital-efficient investment model and the successful execution of our strategy to increase the net asset value and fair value of our business by progressing cohort portfolio companies through value creation stages, obtaining third-party investment, and providing proactive portfolio management."
“We believe that this fundraising positions Ventive well for further growth and we look forward to continuing to work closely with Ventive in this rapidly growing high-impact market segment.”
