Hope this or a similar scenario is what is going on at DNAP:
How to Spend $20,000 and Return $150 Million
SERVICE:
Business Advisory Consulting
CLIENT:
CEO and Board of Directors, venture backed
start-up
REQUIREMENT:
Technology License preparation and valuation
SITUATION:
A well-regarded VC firm had invested over $20 million in a technology start up that was producing $5 million in annual revenue. The Client entered into substantive licensing arrangement negotiations with an array of companies and discovered it needed additional expertise. Semaphore was to provide visibility into, and preparation for, these critically immediate efforts in order to better assure that the Client received fair value for its asset technology during such negotiations. Semaphore was to collaboratively present and review options and provide context and validation to support the utilization of one time technology license, site license, NRE charges with royalty payments, OEM relationship, etc. Semaphore was charged with delivering a number of potential options.
SCOPE:
Staffing: six person days.
Deliverable: Semaphore's counsel and review to culminate in an agreed action plan for the imminent negotiations.
DISCOVERY:
Semaphore Technology Diligence (S4TD) created a preliminary valuation position paper on the Client's technology. The review included several patents pending and provisional patents (with associated development cost) to deliver the product's IP. The position paper represented a fair analysis of the product and sunk cost. S4TD strongly recommended that the Client perform formal technology and business diligence to derive a completed package of relevant corporate documents including an assessment of the viability and value of the company and its assets. Targeted strategic channels would not consummate a contractual relationship without completing such diligence. It was the opinion of S4TD that this effort would create a significant internal asset during negotiation with the target partners.
S4TD recognized that as management pursued multiple sales channel/joint venture negotiations on a parallel basis they would require outside business counsel to provide tactical advisory services. S4TD established the rationale for and benefit to the respective sales channel targets including valuation ranges according to each of the interests and needs of various markets and channels.
OUTCOME:
1. S4TD recommended that the sales channel negotiation include an invitation for acquisition.
2. The Client's board and management received independent valuation and business insight in order to properly enter critical sales channel negotiation.
3. S4TD provided briefing and option papers, including decision tree outlines, for each channel target and potential acquisition discussion.
4. Client received competing offers for purchase as a result of tactical implementation of strategic plans provided.
5. Client closed on a $150 million acquisition providing for significant return to investors.
At least the players seem to be the right ones:
Semaphore Dedicates Life Sciences Diligence Practice
Firm emphasizes and expands Technology and Sciences diligence to Bio/Pharma markets.
(Boston- London- Zurich) Sema4, Inc. (Semaphore) announces the expansion of its Technology Diligence practice. Stating that Semaphore clients are experiencing greater activity in the Life Sciences markets, Semaphore CEO Mark S. DiSalvo states “We thought it appropriate to greater emphasize the skills and resources we have to provide assurance and Independent Verification and Validation in the Life Sciences and Bio/Pharma markets, especially since our clients are asking us to perform this level of assurance.”
This dedicated Life Sciences business practice was created to provide visibility and clarity to the decision-making process. “It facilitates informed judgments on risk and opportunity. The Life Sciences are often subject to misunderstanding, misapplication and misrepresentation,” said DiSalvo. DiSalvo explained that this confusion has a deleterious effect on productivity in even the most business savvy environments. Semaphore research has discovered that when Technology Diligence is applied prior to, or in concert with, a funding event it provides appropriate and necessary discipline to the judgment process. The result allows for increased confidence in the decision contemplated and executed. Research confirms that Bio/Pharma projects such as drug development are nearly always over budget, behind schedule, or are abandoned completely. Facts are that the FDA approves less than 2% of the drug pipeline. Those that do receive approval often are not commercially successful. Semaphore services in this space include Clinical Trial review, FDA compliance and certification process monitoring, proof of science concept, and acquisition target validation.
The firm has significantly expanded its resources globally in the Life Sciences space. Richard Gabriel former CEO of Calix Corporation is the point person for the firm as head of Life Sciences diligence services practice. “I am delighted to join the quality team represented by Semaphore. Its skills providing real-world diligence from Emerging Technologies to Enterprise Software to Life Sciences are legendary,” he added. His team includes: Hector Gomez, MD, Ph.D, former CEO of Transcend Therapeutics, Inc. and Lonnie Bookbinder, Ph.D, an experienced large Pharma executive. “The strength of this dedicated team will offer our clients the clearest direction and best assurance of success possible. We bring hard science and business savvy to the table every day,” Gabriel added.
About Semaphore Services:
Semaphore provides Technology Diligence, Project Assurance and Business Advisory services in areas from Enterprise Software to Life Sciences for Corporations, Boards of Directors, and Private Equity, VC, Law firms and Investment Banks. Semaphore is a 14-year consultancy providing skilled real-world practitioner Technology Diligence, Project Assurance and Business Advisory services. Among its offerings are warranted Technology Diligence to the funding community, Independent Verification and Validation for ongoing projects, asset valuation, licensing evaluation and marketing and sales analysis. Clients include: Travelers Insurance, Shared Medical Systems, Fleet Bank, Sandia National Labs, Vertex Pharmaceutical, The Federal Reserve System, Zurich Allied, Alta Communications, M/C Venture Partners, IDX, and the National Security Agency.
Later,
W2P
