NetScientific reports profitable year ahead of shift in venture capital trends to deep tech

Deep tech and life sciences venture capital investment group NetScientific plc (LSE: NSCI) has lodged a proprietary trade profit of approximately £427,000 and an increase in capital under advisory to £23.5 million for the year ended 31 December.

The group – which has a portfolio of 23 companies — also reported the raising of £52.2 million during the period through equity and venture debt by 13 of the entities in its stable.

Several portfolio companies including Glycotest Inc, PDS Biotech, Q-Bot and Sofant Technologies, also achieved significant operational milestones and key fundraisings.

Industry shift

NetScientific chief executive officer Ilian Iliev said the positive results would allow the company to take advantage of a shift in the venture capital industry towards deep tech opportunities across life sciences, industrials, sustainability and other major sectors.

“We have significantly enhanced our strategic goals, focusing on a sustainable business model and enhancing the value of our portfolio holdings [and] we are generating fees and executing on secondary exits… our goal is to leverage our differentiated investment model at a critical time for the venture capital industry,” he said.

“With a more diversified approach, we are preparing for profitable returns and strategic divestments which align with our growth strategy… we are also actively exploring new fund opportunities which fit our criteria and expertise.”

Key objectives

Mr Iliev said NetScientific’s key objectives for the immediate future include growing the value of its stake in portfolio companies through capital-efficient investments and active management; and progressing its fund management practice to provide additional annual recurring revenues (in the form of management fees).

The company is working on effective exit strategies for some of its portfolio companies in order to increase its own balance sheet and pursue an “evergreen” investment strategy.

It also aims to achieve financial sustainability by having core costs covered through operational income (such as corporate finance, value creation services and fund management fees) and secondary trading income (through the profitable exit of full or partial holdings in portfolio companies).