John Caines Building and funding an International I.C.T. success ITC Regional Business Round Table, Vilnius 2002 ITC Regional Business Round Table, Vilnius 2002

Building and funding an International I.C.T. success John Caines Business Background The U.K. Investment Scene (Thoughts on) Pulling Ideas Together

Maxima Information Group Enterprise Resource Planning (ERP) for manufacturing and distribution Management Buy Out (MBO), $0.7m, 8 staff, UK. Exit, 2000 $65m, 480 staff, 8 European Countries

The Story from (almost) the beginning

Maxima Information Group ($0.7m to $7.0m ; UK) Product USP’s, (for ‘early adopters’) Very simple product Directors did selling All staff customer facing Cash is King!

Catching the ‘Upswing’

($7m to $65m, Europe) - 1 Different type of customer Added Products and Services Greater geographic coverage $5 million VC Injection

($7m to $65m, Europe) - 2 Acquisitions / Start Ups Denmark, Norway, Sweden, Finland, Germany, Czech Rep, Slovakia. Funding and managing ‘foreign’ operations Importance of Customer Revenues*: -Contracted -Non-contracted (* for our business model)

The U.K. Investment Scene UK Investors for UK Investments (Caines experience) - Venture Capitalists - Other - Other (+ proxy for U.S.A. ?)

U.K. Venture Capital 150 BVCA members : many varieties + syndicates/ layers + syndicates/ layersSector/Size/Stage/GeographyE.g’s –UK Technology Start Up US$ $ 7.5 mn = 30 –Non UK Manufacturing Acquisition US$ 75 – 250 mn = 14

Venture Capitalists Always - management, management, management - provable market - provable product - shareholder protection (i.e. minority control) Currently - Market almost closed

Other Sources of Capital Individuals: Angels, Ofex, Aim Financial Institutions: London Stock Exchange Companies: Corporate Ventures, Trade Partners Government/ International Agencies: Innovation Centres, Regional Funds, Technology awards

CUSTOMERS! Product / Services Supplied Transaction Prepayments Bulk Prepayments

Outside the U.K. U.K. for Non-Brits U.K. investors outside U.K. CONTROL/PROTECTION ISSUE CONTROL/PROTECTION ISSUE (Non U.K. investors outside U.K. Other speakers, please!) Other speakers, please!)

(Thoughts on) Pulling Ideas Together VC’s not the answer unless… Developing an International ICT business

VC’s not the answer unless… Proven management in target markets Already revenue earning Product/Customers pass Due Diligence Simple, visible protection for shareholders 30% p.a. Return on Capital __________________________________ Focus on getting “VC ready”

Some thoughts: Building an International ICT Businesses (until “VC ready”) Develop/ Launch Product in ‘home’ market Use local sales force in each country Start with resellers outside ‘home’ market But make ‘your’ customer [for future] Match funding: Local for ‘home’ operation Trade partners for international

When you are “VC ready” They will come to you! They will compete for your business! You are in control; you have a great business! Onto the next stage!

Good Luck!