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EPIC looks to improve investment opportunities at AGM

Jessica Rowbury reports from a finance session at the European Photonics Industry Consortium’s AGM, where members discussed potential ways the organisation could help attract investment in photonics

The European Photonics Industry Consortium (EPIC) is in the process of producing a list of potential investors for its members in order to make it easier to target companies looking to invest in photonics technologies. The work was part of a discussion at EPIC’s annual general meeting (AGM), which took place 9-10 April in Paris, France.

EPIC is working with a consultant to build up the list of contacts, although, during the meeting, Carlos Lee, director general of EPIC, made a plea for each EPIC member to suggest potential investors. EPIC, acting as a mutual body, would then have a comprehensive list of contacts within the different sectors of photonics who are willing to invest.

The idea would then be that the list would not be given to any one person in its entirety, but if an EPIC member was seeking investment involved in a specific sector, such as life sciences, then the association could provide a couple of contacts within that area.

EPIC’s membership is mainly composed of small and young innovative companies, and therefore access to finance is crucial for scaling up their businesses.

Last year, the association launched the EPIC Venture and Finance Workgroup, for the promotion of venture and finance among its members. The workgroup has already organised a series of focused activities aimed at attracting investors to photonics, promoting trade investment among members, fostering SME development, and cooperating with the public funding sector to improve financing conditions for photonics entrepreneurs.

One issue that arose during the AGM discussion was the challenge of finding investors that understand photonics technologies and its benefits. There is a need to scout out more people willing to invest in photonics, and part of this comes with educating investors on the field, it was said.

Lending support

Guiding members through the investment process, from preparing business plans to signing letters of intent, is another way EPIC could assist its members seeking finance, it was proposed at the event.

This could include developing case studies of photonics companies that have gone through funding rounds, including any mistakes that were made, as well as creating a list of experienced people willing to provide advice to EPIC members.

Coaching companies before they approach investors, advising them on how much technical information to give away and providing examples of what to avoid when entering negotiations would also be helpful to those not familiar with seeking funding, one member said.

It was also suggested that a checklist could be made to help people decide whether the best option would be to seek external investment or to try bootstrap financing, or find other financial sources.

Market research

Many of the EPIC members in the room, including those from JDSU and NKT Photonics, were keen for EPIC to address the state of market reports in the photonics industry. It is a challenge that is often faced, one member stated, that the reports they buy ‘are completely off’ and that many market research companies, ‘interview very few players in the field and then extrapolate from that’.

It was suggested that EPIC could act as a neutral body and collect data from smaller businesses not willing to publicise their figures, which could be a way of acquiring more objective data.

Lee expressed his shock that no such system for data collection exists in the laser industry. In the semiconductor industry, which Lee worked in for many years prior to joining EPIC, data collection programmes have been in place for years; companies send their data to a mutual lawyer, which makes it much easier for a person to find out their market share, he remarked.

‘EPIC could act as a mutual body and deliver the report to those who have submitted the data for free, and for those who did not participate we could sell it,’ Lee proposed. ‘That was what happened in the semiconductor industry, but in the laser industry is doesn’t exist.

‘EPIC would be willing to do that and I think it’s one of the services that is necessary.’

Related stories:

Technobis wins EPIC Phoenix Award for entrepreneurship

EPIC creates working group for photonic integrated circuits

Further information:

EPIC

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