TRI Capital Ltd - Chairman’s Report - March 2007
I am pleased to able to report that 2006 was a year of steady growth for Tricapital during which much was achieved to put us firmly on the map as a credible Business Angel organisation. Basically we are about linking investors to funding deals, preferably in support of businesses in the Scottish Borders. During the year under review we grew our membership substantially with a membership of forty-seven at the year end, and we completed some six funding deals totalling £1M, most of which was matched by the Scottish Co-investment Fund.
A Rights Issue providing £25K from our members in support of Bilston Glen based LAB901 in April was followed in June by a similar sized Rights Issue funding for Edinburgh-based Ectopharma, and both companies continue to develop satisfactorily. April, too, saw 15 members subscribe £150K plus SCIF funding in support of Intrallect, a Linlithgow based business already actively involved in the provision of repository systems for the storage control and distribution of e-learning material. Intrallect, now under the eagle eye of finance director John Burgon, supported by Bob Dryburgh as an observer/consultant, appears to be developing very well. A month later we helped launch Lanarkshire based Gas Sensing Solutions Ltd., for which 21 members subscribed some £330k plus SCIF funding, another project in which John Burgon was closely involved, this time greatly supported by new Club member Des Gibson. Both John and Des joined the Board of GSS which, while still developing its patented gas sensors based on novel adaptations of the very latest technology, is also expected to have an exciting future.
The summer months saw a number of possible investments considered at some length and then fade away. To name but two, Bob Dryburgh had been shepherding Ministry of Ideas for some months with great care – in fact too much care, it appeared, when they ultimately decided they had so much business that they could survive without funding from Tricapital! Aberdeen-based Cytosystems was another business which, championed by Pat Campbell Fraser (PCF) with much valued advice from Professor John Cash, we came close to a deal with only to fail at the last minute. We should also be grateful to Jamie Andrew, another member who has once again been heavily involved in the shadowing of a number of not immediately rewarding potential deals. However, more positively, months of painstaking negotiation by Sam Taylor and Richard Aird was rewarded in October when a deal to launch Syntropharma was finalised. Syntropharma has based its business to develop the use of pharmaceutical ‘patch technology’ in Selkirk, and its funding involving £367K from 24 Tricap members and supported by SCIF, and with additional support from the Bank of Scotland, was our largest deal so far. The undoubted success of these completed deals tends to obscure the large numbers of approaches which we received almost daily (and indeed continue to receive). During 2006 some 60 Business Plans were considered in varying detail by the ‘gatekeeping’ committee (AP PCF and myself) and a significant number of these were then analysed in some detail by PCF to whom we owe a great debt of gratitude for his skill and time readily given. There is every indication that this trend will continue with some 10 businesses being actively considered at present, and a realistic expectation of at least the same number and size of deals being completed during 07 as were in 06.
Much of our activities continue to be assisted by a number of outside agencies, and we are especially grateful for the support of the Scottish Co-Investment Fund and of locally based staff of Scottish Enterprise. We also have to thank David Grahame and his colleagues at LINC Scotland not only for very welcome financial support but also for the considerable number of Business Plans which are sent to us on a regular basis. We also benefit from LINC’s sponsorship of the Angel Leaders Forum which meets on a regular basis to consider the growing number of issues affecting ourselves and other Scottish based Angel organisations. It will therefore be a particular pleasure to welcome Peter Shakeshaft, currently the Chairman of LINC Scotland, amongst a number of other high profile appointments, to address our meeting later on.
Tricapital may be about doing deals, but it is also very much about members, and so we have been delighted to welcome so many new Club members, including those from Highland Ventures from Inverness, and elsewhere, who joined us to assist with the Syntropharma funding. All this activity has necessarily increased the burden of administration on Andy Purves, Gillian and Maxine who must be thanked and congratulated on the excellent job they carry out with great cheerfulness on our behalf. Not that they work, entirely alone because we also have to be very grateful to a number of members apart from those already mentioned who have contributed significantly to our progress, and indeed the ongoing general support from so many members provides a key contribution to our success so far. The increase in our activity has also encouraged the continued development of our website, ably managed by Stuart Richardson, and we hope to have a Secure Members area come on stream in the next few months.
In spite of the increase in membership we would like to think that Tricap remains a professional, yet friendly, organisation and that the social interaction between members at monthly meetings, and on other occasions, is one of the bonuses of membership. Without going overboard, we hope to encourage social gatherings of members where appropriate and hope during the current year to repeat the success of the Tricap table at Kelso races in April, the Golf Day at the Roxburghe in September (where Jeremy Brett was the impressive winner of the Chairman’s Trophy), and the Christmas drinks party and dinner in December.
I am glad to say that not only was 2006 a busy year, it was also profitable - with a healthy surplus of some £15.5K in the year to December 31st 2006 even after providing reasonable remuneration and honoraria to the Board and others most closely involved in the organisation. That this was achieved was in considerable part due not only to the drive and enthusiasm of Andy Purves and his colleagues but also to the Board who have worked so well together throughout the year and for whose consistent and helpful support I am most grateful.
Robert Dick - Chairman