MEMS and Medical Devices: Remarkable Innovation’s Recent Projects
We thought it would be interesting to put together some statistics about the technical due diligence projects we’ve worked on over the past six months.
This includes projects we’ve done for venture capital, private equity, large corporate and governmental investors. Obviously we can’t go into very much detail about the projects for confidentiality reasons but it’s interesting to take a look at the trends.
Perhaps it’s not a very accurate representation of where investment is being directed over all, but it at least gives an idea of where technical due diligence is being performed before investments are made.
First of all, let’s take a broad look at the areas of technology that our recent projects have covered. For our own administration purposes we divide our areas of focus into four (very broad) categories: Technology, Media and Telecommunications, Energy and Resources, Manufacturing, Emerging Technologies. In the last six months we’ve done work in all of those areas, as Graph 1 shows.
Graph 1: Recent Remarkable Innovation projects broken down by sector
The relatively few projects in Energy and Resources, and particularly in Clean Tech, is surprising, and something that we expect to see change as time goes on. We’ve got strong technical capabilities in those areas and have had a number of enquiries particularly about clean tech propositions, so the next bi-annual stats are likely to be more weighted in that direction.
The dominance of emerging technologies is not so surprising: earlier stage technologies obviously carry more uncertainty, so technical due diligence provides greater value in reducing investment risk. In fact, we’re sometimes mistaken for a firm that only deals with emerging technology, but actually technical due diligence is often required even when only established technology is involved. Graph 2 shows how our recent work has been divided between examining “new” technology (original inventions that haven’t been commercialised yet) and “established” technology (things like IT systems or manufacturing equipment).
Graph 2: Recent Remarkable Innovation projects broken down by new or existing technology
So just under a third of our projects involved examining companies that have “new” technology. Graph 3 is the most interesting. It’s a break down of the types of technology that comprised the “new” products that we’ve looked at recently.
Graph 3: Recent due diligence projects involving new products, broken down by underlying technology. MEMS = Microelectromechanical Systems, Med Dev = Medical Device, Mach Vision = Machine Vision
The domination of MEMS is interesting. It’s a popular field right now, and is attracting a lot of interest from investors with a high risk appetite. It’s not surprising to see Medical Devices featuring strongly too given the impressive growth forecasts in that area, particularly with demand increasing in emerging geographical markets.
There’s lots of potential pitfalls with investing in all of these technologies, and indeed our due diligence projects uncovered many such issues. It’s great to see that investors are exploring these areas though. Good technical due diligence can guide you to the right opportunities.