Latest Company Announcements

Sectors: Finance

Develop your venture for its strategic value - By Tom McKaskill

More and more entrepreneurs are recognizing that the real value in an enterprise comes from its value to an acquirer rather than its profitability. They are also seeing that strategic value can be created easier and faster than conventional value based on their own inherent future profitability.

8 June 2011 More and more entrepreneurs are recognizing that the real value in an enterprise comes from its value to an acquirer rather than its profitability. They are also seeing that strategic value can be created easier and faster than conventional value based on their own inherent future profitability. Also, if they can avoid the risks of developing the organisation beyond a limited size, they avoid the risks of growing the enterprise, often the cause of business failure. As many entrepreneurs don’t have the experience, capability or funds to fuel a growth oriented strategy, a strategic value objective makes good sense.

However, while strategic value might be an objective, it requires a very clever strategy to be successful. It is not enough to create a product or service and hope someone will come along and buy the business. A good product doesn’t necessarily create strategic value.
Strategic value is only created when an acquirer buys a product or service which they can exploit on a large scale. That being the case, there are a number of essential attributes which the underlying product or service must have.

The first requirement is that it must offer the acquirer a significant competitive advantage in the acquirer’s marketplace. If a product or service can be readily copied there is only limited benefit to the acquirer. At the same time, if there are close alternatives or substitutes, the competitive advantages are weak and the asset or service is worth little to the acquirer as they would fail to generate significant gains from it.

The product or service really needs to target a complex or serious problem which will create significant market demand. This is what I call the ‘compelling need to buy’. A vendor who can satisfy this condition and has a competitive advantage can charge a premium price but also achieve short sales cycles. This type of situation fuels very high growth.

One of the key requirements is scalability or rapid replication. The highest strategic value premiums will go to those products or services which the acquirer can roll out or deploy rapidly. This is perhaps why standard internet, software and computer hardware based products have generated such high price multiples in recent acquisitions.

Of course, you also have to be in a marketplace where there are large corporations willing and able to undertake strategic acquisitions. They need to have very large customer bases or distribution channels and be able to easily take advantage of the acquisition. As a rule of thumb, the strategic value in an acquisition is thought to be equal to a two year payback on the acquisition investment. This is where scalability and rapid deployment garners the highest strategic premiums.

Entrepreneurs who set out to create strategic premiums use these criteria to examine large corporations in their industry to identify products and services which fit well with the marketplace of the best acquirers. They understand the acquisition criteria of these corporations and set out to conform to those requirements. But they don’t wait to be invited to the dance, they take the initiative to build relationships in advance to confirm their strategy and set up the final exit deal.

You can only be successful in a strategic value exit if you have laid the ground work. That is, you have identified the potential acquirers, built your relationships with them, confirmed their needs and that they have the capability to exploit the strategic asset, ascertained their willingness to acquire smaller ventures or IP, assembled your deal team and prepared yourself for due diligence. While this may seem daunting, this does not happen overnight and therefore there is usually plenty of time to put this strategy in place.

There is an alternative of course. You could build a business on the back of the expertise or IP you create. Of course, that also means you have to build the capacity and capability to exploit it. Few entrepreneurs have the necessary knowledge, networks, funding and experience to do so. When you review the rates of failure, the chances of being able to exploit a business opportunity are in fact very slim. However, the chances of developing some expertise or IP which someone else can exploit are often very good. Furthermore, the rewards are often much greater and the timescales are usually considerably less. You should also not overlook the fact that it is much easier to raise angel or venture capital if you can show a robust and achievable high value exit.

You only have to review the acquisitions made by the likes of Cisco, Yahoo, Google, Oracle, IBM and HP to see that these deals are occurring all the time and often for significant values.

CEO Interviews

	Scott Power - Brisbane Capital Showcase Scott Power is a Senior Analyst with RBS Morgans
	Steve Baxter Presentation from the Brisbane Capital Sho... Steve Baxter Presentation from the Brisbane Capital Showcase
	Biosana Pty Ltd - Brisbane Capital Showcase Investor Pr... Biosana Pty Ltd - Brisbane Capital Showcase Investor Presentation
	Chip Tyre - Investor Presentation Brisbane Capital Show... Chip Tyre - Investor Presentation Brisbane Capital Showcase
	Mesynthes - Investor Presentation Brisbane Capital Show... Mesynthes Limited - Investor Presentation Brisbane Capital Showcase
	Jumbo Interactive Investor Presentation (ASX:JIN) Just as other industries have moved successfully onto the Internet (Airfares, Employment, Accommodation, Real Estate, et...
	Easylodge Infrastructure Services Investor Presentation Easylodge was founded in 2006 to provide software and infrastructure services to the non-mortgage finance industry, and ...
	Phylogica (Investor Presentation) Phylogica Limited (ASX: PYC) is a biotechnology company based in Perth, Australia and Oxford UK, with a world-class drug...
	Australian Real Estate Lottery (CEO Interview) The Australian Real Estate Lottery model is a unique mixture of gaming and property to create a financing tool to acquir...
	Easylodge Infrastructure Service (CEO Interview) Easylodge was founded in 2006 to provide software and infrastructure services to the non-mortgage finance industry, and ...
	Wholesale Investor Capital Showcase 2012 Date: Wednesday 4th April, 2012 Location: PwC Offices Brisbane, Riverside Centre Wholesale Investor and AusBiotech w...
	Investment Administration Pty Ltd (CEO Interview) Investment Administration (InvestAdmin) provides a complete, robust, scalable, technology based solution for the end-to-...
	Rubber Ducky Defence (CEO Interview) Rubber Ducky Defence is the developer of a powerful, low-cost maritime platform and weapons system which has the potenti...
	BioPower Systems (CEO Interview) BioPower Systems is focused on developing advanced technologies which convert the energy in waves and tides to grid-read...
	Qanda Technology Limited (CEO Interview) Qanda Technology owns 2 operating businesses. - Marketboomer provided online procurement services and technology to h...
	PwC Private Business Barometer Welcome to the ninth edition of the PwC Private Business Barometer.
	Exa Web Solutions (CEO Interview) Exa was founded in 2000 and has since become Australia's number one online marketing and web solutions company. Through ...
	WH Medical Pty Ltd (CEO Interview) Gold Coast Accident & Medical Clinic (A&MC) is a private emergency clinic designed to take direct pressure of the public...
	Elemental Energy Technologies Ltd (CEO Interview) Elemental Energy Technologies Ltd (â€œEETâ€) has been formed to commercialise its breakthrough third generation marine ...
	Cleantech and Renewable Energy Showcase Wholesale Investor in conjunction with our Principal Support Partners, PwC are proud to host the Cleantech and Renewable...
	Immuron Ltd (CEO Interview) Immuron Ltd is a biopharmaceutical development company with a versatile technology platform that has allowed it to devel...
	Palace Resources (CEO Interview) Palace Resources (ASX Code: PXR) is progressing due diligence on the Lumpo coal project (â€œLumpo Projectâ€) in West Su...
	BioDiem Ltd (CEO Interview) BioDiem is a vaccine company developing vaccines for both treatment and prevention of disease. The leading technology is...
	Eastern Harmony New Zealand Ltd (CEO Interview) EHNZ has commenced business as a wholesaler/distributor of NZ milk powder products in the Asia Pacific region
	Equiome Pty. Ltd (Investor Presentation) Equiome is a specialist financier of all aspects of large corporate software projects, which allows companies to realise...
	Cynergy Health (Investor Presentation) Our objective is to grow a broad based consumer health company by developing or acquiring high potential brands or produ...
	Bizpanel Limited (Investor Presentatio) The Australian Franchise Industry is a $138 billion industry featuring 1,025 franchisors and 69,900 franchise businesses...
	Exa Web Solutions (Investor Presentation) Exa is Australiaâ€™s largest Online / Apps / Web / Mobile company, with over 1000 clients. Exa generates significant ...
	Elemental Energy Technologies LTD (Investor Presentatio... Elemental Energy Technologies Ltd (â€œEETâ€) has been formed to commercialise its breakthrough third generation marine...
	Qanda Technology Limited (Investor Presentation) Qanda Technology owns 2 operating businesses. - Marketboomer provided online procurement services and technology to h...
	Mint Wireless Limited (Investor Presentation) Mint Wireless Limited (Mint) is a global payments and mobile transactions company listed on the Australian Securities Ex...
	Photonz Corporation Limited (CEO Interview) Photonz is a world-leader in the production of the omega-3 compound â€œEPAâ€ by fermentation for high purity, pharmaceu...
	Benitec Ltd (CEO Interview) Benitec Limited is a publicly listed (ASX:BLT) biotechnology company developing novel human therapies based on a transfo...
	Bizpanel Limited (CEO Interview) The Australian Franchise Industry is a $138 billion industry featuring 1,025 franchisors and 69,900 franchise businesses...
	Intellect Projects Intellect Projects is a property developing company, located within the inner suburbs of Melbourne, specialising in qual...
	Mint Wireless Ltd (CEO Interview) Mint Wireless Limited (Mint) is a global payments and mobile transactions company listed on the Australian Securities Ex...
	Folkestone (CEO Interview) Folkestone is a real estate investment, development and funds management company listed on the ASX (Code: FLK).
	Jubilent Health Aust. Ltd (CEO Interview) Based in Australia, Jubilent Health has an international focus that allows us to manufacture and retail pharmaceutical p...
	Diamond Energy (CEO Interview) Established renewable/low-carbon electricity integrated â€œgen-tailerâ€ seeking to accelerate expansion.
	Xenexus Pharmaceuticals Pty Ltd (CEO Interview) Xenexus is undertaking R & D on existing drugs in new indications to secure new use patents on these re-profiled drugs.
	Sun Connect (CEO Interview) Sun Connect Pty Ltd is a wholly privately owned Australian importer, designer and installer of solar power components. S...
	Third Link Growth Fund (CEO Interview) The portfolio manager of the Third link Growth Fund is funds management industry stalwart Chris Cuffe, who has drawn on ...
	Future Capital Development Fund (CEO Interview) Future Capital Development Fund Limited is a pooled development fund (PDF). As a PDF, the Company will actively seek to ...
	KFSU Limited (CEO Interview) Established in 2006, KFSU Limited ACN 119 778 326 is a food ingredient manufacturing company creating natural products f...
	Equiome (CEO Interview) Equiome is a specialist financier of all aspects of large corporate software projects, which allows companies to realise...
	Special Phage Holdings (Investor Presentation June 2011... Special Phage Holdings (SPH) is an innovative biopharmaceutical company focused on developing novel antibacterials in re...
	Wholesale Investor (Investor Presentation - June 2011) Wholesale Investor is Australia's largest private investment platform directly connecting high net worth and professionl...
	Sun Connect Pty Ltd (Investor Presentation - June 2011) Sun Connect Pty Ltd is a wholly privately owned Australian importer, designer and installer of solar power components. S...
	Future Capital Development Fund (Investor Presentation ... Future Capital Development Fund Limited is a pooled development fund (PDF). As a PDF, the Company will actively seek to ...
	Colmax Glass (Investor Presentation - June 2011) Colmax Glass has rapidly become Australiaâ€™s premier post-consumer glass recycler due to its ability to transform recyc...
	Medivac - CEO Interview MediVac was incorporated in 1997 to commercialise patented technology for the treatment of biological waste that would r...
	Colmax Glass Recyclers Colmax Glass has rapidly become Australiaâ€™s premier post-consumer glass recycler due to its ability to transform recyc...
	Flinders Exploration - Melbourne Investor Presentation FEX is a new mineral development company with gold resources and a copper Exploration Target ready to commence pre-feasi...
	Minotaur Exploration - Investor Presentation Minotaur specialises in application of cutting-edge geophysical techniques to locate virgin mineralisation deep below th...
	Latin Resources Limited Latin Resources Limited is a mineral exploration company focused on creating shareholder wealth through the identificati...
	Audio Pixels Limited - Investor Presentation Audio Pixels Limited was founded in July 2006 has developed a revolutionary technological platform for reproducing sound...
	Virax Holdings Limited Developing therapeutics for autoimmune diseases, AIDS, cancers, infectious diseases based on patented Co-X-Gene platform...
	Deasil Management Group Philip Weinman could be Australiaâ€™s ultimate serial entrepreneur. After starting and selling seven fast-growing busine...
	Colmax Glass - Investor Presentation Colmax Glass has rapidly become Australiaâ€™s premier post-consumer glass recycler due to its ability to transform recyc...
	Third Link - Investor Presentation The opportunity to invest in a professionally managed investment fund, with all fees received by the investment manager,...
	Commissioners Gold - Investor Presentation I have pleasure in presenting to you an offer to subscribe for shares in Commissioners Gold Limited, a new gold explora...
	Biogenerics Australia - Investor Presentation Biogenerics Australia (BGA) was established in 2005 to introduce cheaper generic forms of biological drugs into Australi...
	Virtual Gaming Worlds (Investor Presentation) Are developing a unique online casino operation, enabling players to interact via Social Network Gaming and Massively Mu...
	Equiome (Investor Presentation) Equiome is a specialist financier of all aspects of large corporate software projects, which allows companies to realise...
	Global Digital Networks (Investor Presentation) l Digital Networks is an innovative Information Services and Technology company that is leading the revolution in deleiv...
	Advanced Braking Technology (Investor Presentation) Advanced Braking Technology Ltd has commercialised an innovative and patented enclosed oil cooled braking system that is...
	Mesynthes (Investor Presentation) Mesynthes is a soft-tissue reconstruction company using its proprietary Endoform technology to develop regenerative tiss...
	Jumbo Interactive (Investor Presentation) Jumbo Interactive Ltd is an innovative and successful online lottery business that has created the hugely popular Oz Lot...
	Magma Mines Magma Mines is wholly focused on exploration of mineral resources in Fiji. For a number of years Magma has held explorat...
	Phylogica Limited - ASX Small Cap Showcase ylogica Limited (ASX: PYC) is a biotechnology company based in Perth, Australia and Oxford UK, with a world-class drug d...
	Biogenerics Australia Biogenerics Australia Pty Ltd (BGA) was established in early 2005 by Mr Peter Simpson and has as its primary commercial ...
	Progen Pharmaceutical (Small Cap Showcase 2011) Progen Pharmaceuticals Limited (Progen) is a dual listed Australian (ASX:PGL & US OTC: PGLA) clinical stage oncology dru...
	Virax Holdings Limited Virax Holdings Limited (Virax) is a biopharmaceutical company. The Company is engaged in the discovery and development o...
	Viralytics Limited (Small Cap Showcase 2011) Oncolytic virotherapy makes use of the cancer destroying capabilities of a range of benign viruses. The potential of o...
	EcoQuest (Small Cap Showcase 2011) After two years or extensive research, EcoQuest Limited is poised to commercialise its 93% biodegradable nappies and com...
	Circadian Technologies (Small Cap Showcase 2011) Circadian Technologies Limited (Circadian) is an Australia-based company. The Companyâ€™s principal activity is to devel...
	Advanced Braking Technology Advanced Braking Technology Ltd has commercialised an innovative and patented enclosed oil cooled braking system that is...
	Phosphagenics (Small Cap Showcase 2011) Phosphagenics is a completely advanced company with a platform delivery technology currently developing products for hum...
	Eastland Medical Systems Limited (Small Cap Showcase 20... Eastland Medical Systems Ltd (EMS) is an Australian based Biotechnology licensing company. Our focus is the identificati...
	Gold Road Resources Limited (Small Cap Showcase 2011) Gold Road Resources Limited is developing its 100%-owned Yamarna Gold Project, a 3,200km2 tenement covering the majority...
	Resonance Health (ASX:RHT) Resonance Health develops unique quantitative MRI image analysis technologies for the diagnosis and monitoring of human ...
	Jumbo Interactive (Small Cap Showcase 2011) Jumbo Interactive (JIN) is an Australia-based company. It has two segments: Internet Lotteries, and Software Publishing ...
	Phylogica Limited (ASX:PYC) - Reuters Insider Phylogica is a public company engaged in the discovery and development of novel peptide-based biopharmaceuticals. Phylog...
	Enerji Limited (ASX:ERJ) Enerji is a Perth-based emerging green power utility specialising in the provision of Opcon Powerbox waste heat conversi...
	Gold Mines of Peru (ASX:GMO) -Thomson Reuters Insider Gold Mines of Peru has a two-pronged strategy to secure, develop and exploit advanced gold and silver assets in central ...
	KarmelSonix (ASX:KSX) - Thomson Reuters Insider KarmelSonix (KSX) is a commercial stage, ASX listed, medical device company that manufactures and sells products that as...
	EcoQuest (ASX:ECQ) CEO Interview - Reuters Insider After two years or extensive research, EcoQuest Limited is poised to commercialise its 93% biodegradable nappies and com...
	Global Digital Networks Pty Ltd - Thomson Reuters Insid... Global Digital Networks is an innovative Information Services and Technology company
	Cloncurry Metals Limited (ASX:CCU) -Thomson Reuters Ins... Cloncurry Metals Limited has excellent exploration ground in Queensland, Australia and in the state of Michoacan, Mexico...
	Carbon Conscious Limited (ASX:CCF) - Thomson Reuters In... Carbon Conscious is Australiaâ€™s leading carbon forest sink project developer.
	Progen Pharmaceuticals (ASX:PGL) - Thomson Reuters Insi... Progen Pharmaceuticals Limited (Progen) is a dual listed Australian (ASX:PGL & US OTC: PGLA) clinical stage oncology dru...
	Viralytics (ASX:VLA) - Thomson Reuters Insider The development of targeted cancer therapies using oncolytic viruses to detect, invade and destroy cancer cells. Oncolyt...
	Patrys Limited (ASX:PAB) - Thomson Reuters Insider Patrys develops natural human antibody-based treatments for cancer.
	Rox Resources (ASX:ROX) -Thomson Reuters Insider Rox owns the Myrtle project in the NT, just south of the McArthur River mine, where a resource of 43.6 million tonnes gr...
	EcoQuest (ASX:ECQ) - Thomson Reuters Insider After two years or extensive research, EcoQuest Limited is poised to commercialise its 93% biodegradable nappies and com...
	Minemakers (MAK) - Thomson Reuters Insider Minemakers Limited (ASX Code: MAK), since its inception in 2004 and listing in October 2006, has aimed to acquire major ...
	Vocus Communication Ltd (ASX:VOC) - Thomson Reuters Ins... Vocus Communications Ltd. (ASX:VOC) is a pioneering, newly ASX- listed, wholesale voice and data provider, backed by Inv...
	Because Group International Because Group International Ltd (Because Group) is a global digital media distribution company with operations in the US...
	Anteo Diagnostics - Thomson Reuters Insider Anteo has demonstrated further applications of the technology in several other large market segments such as clinical as...