27 February, 2013 - 15:35 By Tony Quested

What price IP as another one bites the dust?

Failure to commercialise a stack of IP has sent a second Cambridge technology cluster business in the space of 72 hours crashing into the wall.

Pursuit Dynamics has followed HiWave into the waiting room at the mortuary in circumstances that underline the futility of having good technology if you don’t know how to use it.

The double demise has sent warning bells ringing round the UK’s ideas capital. There are Cambridge companies raising millions on the back of huge patent portfolios and still haemorrhaging cash.

In many cases the painful truth is that the companies don’t have the financial clout to protect their Intellectual Property Rights – and that is heightening their vulnerability.

HiWave, which officially went bust on Monday, was a classic case in point. It inherited a mountain of patents – well over 500 – from its forerunner NXT and the cost of maintaining the portfolio proved a millstone.

Pursuit, which has decided to sack all staff, consider closing its operations and hiving off the IP to another company or a potential partner, admits today that it has failed to commercialise its highly promising technology.

After Procter & Gamble pulled out of a potential deal last year Business Weekly described Pursuit as a dead man walking. Even raising £5.4m last November hasn’t smothered the cash burn.

The firm has set new targets for the six months ending March 31 but no-one is holding their breath. The company lost £17.8 million before tax in 2012 – an horrendous situation considering the cash it raised and that revenues were around £200k higher than the prior year.

The company’s cashpile – despite the fundraising – halved. A new board decided there was too much hype and not enough sales action.

Pursuit was axeing staff, looking at what operations to close and cutting costs to the bone today. Its chances of hiving off the technology for anything like a decent price in such a blazing fire sale looked remote to say the least.

Pursuit Dynamics was founded in 2000 to develop and commercialise the PDX® platform technology. The PDX technology is protected by 50+ patents.Applications identified range from food, brewing and dairy industries through to oil and gas.

It’s a business that should never have failed and shareholders are in no mood for hard luck stories. This demise is down to rank bad management.

Several times the company has been forced to pivot. In the end the spin had turned into a pirouette.

But there are other accidents out there in the Cambridge community just waiting to happen if companies don’t get commercial earlier and abandon the illusion that their IP will save them. If potential buyers know a company is in trouble they wait for it to perish and hoover up the IP for a much lesser price.

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