Nobel ties and finance discussed at Invest in Photonics

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Greg Blackman reports from Invest in Photonics, an event held a day after the Nobel Prizes in Physics and Chemistry were awarded to light-based technologies

Not everyone knows a Nobel Laureate, but there were links to not just one but two of the winners of the Nobel Prizes in Physics and Chemistry at the Invest in Photonics conference. The event, held in Bordeaux, France, took place from 9 to 10 October just days after the Nobel Prizes were announced.

Giorgio Anania, CEO of LED company Aledia and Chairman of the conference, recalled in his welcome address how Professor Hiroshi Amano, one of three scientists who won the Nobel Prize in Physics for developing the blue LED, was working with Aledia at the company’s base in Grenoble when he received the news. Professor Amano is a member of the scientific advisory board for Anania, a company developing LEDs based on nanowire technology.

Also speaking at the event, Christoph Thumser, sales director of life sciences research at Leica Microsystems, remarked that Leica Microsystems has worked in close collaboration with Stephan Hell, the Chemistry Nobel Laureate who invented stimulated emission depletion (STED) microscopy. STED is a technique that overcomes the diffraction limit of traditional optical microscopy (around 200nm), offering resolutions of 30nm to 80nm.

Thumser said during his presentation that Leica Microsystems launched its first super resolution microscopy system in 2004, although this wasn’t a great success commercially. The company then went on to introduce its first STED system in 2007, and Thumser noted that the market for super resolution microscopy is expected to grow by 15 per cent over the next few years, compared to only 2-3 per cent for the total microscopy market.

The conference brought together photonics companies with venture capitalists and covered topics ranging from life sciences, electronics, and the environment, to alternative financing. Interspersed with the sessions were pitches from 20 photonic start-ups, which were judged by a panel of venture capitalists and investment experts.

The investment landscape for photonics is now dominated by corporate investment, with less activity from venture capitalists, Anania commented speaking to Electro Optics prior to the conference. He said that companies like Google, Apple and Samsung are the big investors in photonics technologies at the moment – the CEO of OLED company Novaled, Gildas Sorin, was one of the speakers; Samsung bought Novaled in 2013 for €260 million.

Sorin commented that photonics technology ‘takes time’ to mature and see a return on investment. Novaled was founded in 2003 and took 10 years to sell.

Sorin stated: ‘Innovation will come from start-ups, not corporates,’ adding that there’s money to be made from start-up companies, but it takes time and there will be some risk involved. He said that venture capitalists need courage to make an investment in photonics technology and that they can’t expect a return on investment in just two years.

George Ugras, general partner at Adams Capital Management, gave the argument from the venture capitalists’ perspective, that technologies like OLED materials that will take 10 years to mature are difficult to fund.

Photonics doesn’t have one large product, Ugras said; there are lots of small companies which makes it difficult for venture capitalists to invest in the technology. The technology has to address a huge market, he added; if it’s not huge, then investment often has to come through government funding.

With venture capitalists being less active, the positive news is that corporate investment is on the rise. There are also many growth areas for photonics technologies – Jean-Luc Beylat, president of Alcatel Lucent Bell Labs France, commented that silicon photonics for data centres was a huge opportunity for companies working in this area. According to market analyst, Yole Développement, the silicon photonics device market will grow from $25 million in 2013 to more than $700 million in 2024, at a 38 per cent CAGR.

In fact, the ‘elevator pitch’ competition taking place throughout the conference was won by Effect Photonics, which aims to commercialise an InP-based integrated photonics platform. James Regan, CEO of Effect Photonics, a 2011 spin out from the University of Eindhoven in The Netherlands, was presented with the award and the €5,000 prize money. Photonic integrated circuits are considered more mature than their silicon photonics cousin, but are higher cost due the expense in testing the devices.

It is still really difficult for many start-ups to get funding, and the majority of a CEO’s time for these small companies is spent looking for financing. In order to help with this process, the European Photonics Industry Consortium (EPIC) has launched a working group to promote finance activities among its members. Among its first planned initiatives is a photonics venture event in April 2015 to be held in Rome. The event will aim to maximise photonics entrepreneurs’ access to European Commission funding.

Thierry Thevenin, head of the organising committee at Invest in Photonics, said in a statement: 'Since holding our first Invest in Photonics event in 2008, we have seen that it takes an average of two years for a candidate to close a funding round. Of the 41 companies who have participated in our events, 40 per cent have succeeded in raising funds. The majority of those seeking seed funding have raised €1.5 million. Others have raised much more capital, with the highest at €15 million.’

Since 2008, the event has helped photonics firms raise close to €50 million in funding.

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