Harry Berry, partner at Suffolk-based global VC, NVP
"US management is much more driven by equity rewards with more focus on sales and customers focused."
New Venture Partners , the global venture capital firm dedicated to corporate technology spin-outs, has over $700 million under management. Starting in 1997 as Lucent Technologies, New Ventures Group and operating as an independent firm since 2001, the New Venture Partners team has launched dozens of companies built upon innovations from Bell Labs and Philips as well as BT's research campus based at Adastral Park, near Ipswich. Harry Berry has over 30 years experience in the telecommunications industry and has held a wide range of senior positions. He was a director on the board of BT Exact Technologies and the creator of BT Brightstar, BT's corporate incubator at Adastral Park, prior to setting up the European arm of New Venture Partners. He joined New Venture Partners in 2003 and focuses on European investment opportunities, managing the operations of the United Kingdom-based team.
1) Can you give a snapshot of how things stand with the fund you raised in 2006.
We raised a $303M fund in June 2006 and have committed approximately 40 per cent to date, which puts us on right on plan. As expected, the majority of investments have been in the US, but we have also made investments in the UK, Netherlands and Australia.
2) When can we expect to see the next spin-out from BT? It seems to have been a while since the last one.
The latest BT Spin out was Real Time Content Ltd, which spun out in April 2008. RTC enables interactive video advertising.
3) How has the recession affected your activities or approach?
In terms of our investment approach, it has not impacted our deal flow. Unlike many VCs, we work closely with our corporate partners.
4) What is your take on the current state of the UK technology venturing market?
There are plenty of technology based opportunities but fewer active funds than would be desirable. It feels like this is not likely to improve in the near future due to the current climate.
5) NVP operates a truly global model. What are the practical benefits of this?
We are able to position our companies in the geography where they are best suited to attract talent, service their customers and raise the requisite financing.
For example, we have spun a company out from Telstra in Australia but moved its headquarters to New Jersey in the USA. Additionally, we are able to build a company by sourcing different technologies from different corporations around the world to quickly create critical mass companies. An example of this would be AirVersent.
6) Your relationships with large corporate innovators gives you a ready supply of excellent opportunities. Are there any major challenges inherent in working with organisations of this size?
There are often complex, difficult IP, Legal and HR issues which have to be overcome to do a spin-out. Our own corporate history means we have deep insight in understanding how to tackle these issues.
To date, having done over 50 spinouts, we have developed a number of models to overcome these difficulties.
7) What have you learnt from your exposure to the US approach to technology commercialisation?
US management is much more driven by equity rewards with more focus on sales and customers focused. Quantity and quality of capital is more readily available for good opportunities.
8) What are the hot areas of communications innovation in your view?
The areas where different technologies meet (i.e. Media/telecoms, IT/Medical) and electronics and clean technology.
9) What three pieces of advice would you give to an enterprise seeking Venture Capital?
1) Ensure that the VC firm you have approached has skills beyond purely providing capital.
2) Make sure they have deep pockets to fund the company for the next two-three years if required.
3) Have an achievable business plan with a well articulated value proposition for customers.
10) There are some exciting developments afoot at BT's Adastral Park campus. Are you involved in any way and if so, can you give some insight into how things are progressing.
As always, there is a continuing stream of exciting things going on. As you would expect, I would not reveal anything about our forthcoming activities until it makes commercial sense to do so.