The Role of Venture Capital Funding in Aquaculture

1
The Role of Venture Capital Funding in Aquaculture

• ACF Equity Atlantic
• February 11, 2004

2
Role of VC Funding in Aquaculture

• What is Venture Capital
• Venture Capital in Atlantic Canada
• Investment Criteria
• Challenges Aquaculture through a VCs Eyes

3
Declining in Atlantic Canada Financings and
Invested Atlantic Region
4
Few New Deals Being Done in the Region Invested
in New vs. Follow-ons Canada and Atlantic Region
Atlantic Region
Canada
75M
48M
5.3B
3.9B
1.7B
31M
9M
30M
5
Focus on Tech Companies Disbursements
Traditional vs. Technology Atlantic Region
75M
53M
48M
44M
33M
30M
6
Investors Active in Atlantic Canada
ACF Equity Atlantic Inc. - No New Investments BDC
Venture Capital Group Canadian Science and
Technology Growth Fund Growthworks Nova Scotia
First Fund Workers Investment Fund
7
VC Activity in Atlantic Canada
Newfoundland 2001 7 MM Invd 1 Company 2002
0.5 MM Invd 1 Companies 2003 9.7 MM Invd 4
Companies
PEI 2001 234 K Invd 1 Company
New Brunswick 2001 16 MM Invd 6
Companies 2002 23 MM Invd 3 Companies 2003
2.5 MM Invd 2 Companies
Nova Scotia 2001 25 MM Invd 10
Companies 2002 7 MM Invd 4 Companies 2003 18
MM Invd 4 Companies
8
Summary of VC Activity in Atlantic Reqion

• Few Players Active
• Even Fewer with Feet on the Street
• Industry Cautiously Re-Engaging
• RESULT
• Crisis of Access to Capital in Region

9
What VCs Look For

• Unique Product/Technology/Service
• Large and Growing Market
• Experienced Management Teams
• Entrepreneurial Fire
• Trade Off
• Early Stage Promise
• vs
• Later Stage Fundamentals

10
Selected Disclosed Deals 2003
11
Challenges Aquaculture through a VCs Eyes

• Long Product Development Lead Time
• External Factors - Price, Disease, Industry
• Capital Intensive
• Solutions
• Ability to Differentiate
• Risk Mitigation
• Create Value Added