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Luminous Ventures II SCSp (Fund II)

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  • £1,000,000.00
    Min. investment
  • Healthcare and Services
    Sector
  • Venture Capital
    Investment type

Summary

Backing the brightest entrepreneurs to bring positive transformation to our societies using breakthrough technologies.

Luminous Ventures generates superior returns by investing in Europe’s leading emerging applied science and deep technology companies in human health.

We focus on large problems in healthcare, life sciences and nutrition that can be solved with applied science and technology.

We have unique access to leading universities to look for companies with unfair advantages, proprietary and protected technological advances, large market opportunity, world class teams, unique partnerships and commercial deals at late Seed and Series A.

We assist great entrepreneurs building companies with impact and expect rapid innovation cycles so that we have data and results to see milestone progress.

Highlights

  • Investing in early-stage deep tech companies that leverage breakthrough technologies to solve major challenges in healthcare, life sciences and nutrition
  • Access to the accelerators of universities with the leading researchers globally to get proprietary deal flow access and build relationships early
  • Excellent track record – Fund I on track for 30%+ IRR, with two exits at 34% IRR and 60% IRR respectively
  • Strong mix of operational, investment and domain expertise on the team with significant founder experience and empathy

Investment strategy

We invest at Seed+ and Series A, mainly in the UK but also selectively in Continental Europe and North America.  A reasonable portion of the risks associated with Seed-type investments have been mitigated by this late Seed and Series A investment.  Value creation is derived from capturing the pre-inflection point.  When category leaders emerge, late Seed investors make significant multiples on their investment.  We will invest in 25 companies, holding 50% of the fund for follow-ons and we aim to hold a stake of min 10% of the strongest companies emerging from the Series B.  We only invest in companies whose returns alone can return the portfolio - we are not interested in mediocrity.  


EQ for the IQ - supporting founders with our blueprint

We are in the company-building business, not the "financial engineering" business.

A focus on world-class talent to put the right people, on the right seats at the right time

Our unique proposition is the aligment of product, marketing and sales to quickly re-iterate and find unqiue blue ocean space

Data driven decision making using proven platforms and processes

A strong strategy of walls and moats to protect IP

We are customer centric, with rapid innovation cycles to build a $billion brand and with a laser focus on the exit

Exit strategy

The Fund will concentrate on building strong, sustainably growing businesses rather than aiming for early exits before real value has been achieved. While planning for a realistic and timely exit with a view to achieving high returns, the Manager will prioritise building up value in the business.

Luminous Ventures’s portfolio companies have a strong technology component, and therefore the natural acquirers for these businesses are the world’s largest technology companies. To date, most acquirers of our portfolio businesses originate from the US or Asia and acquire businesses in USD – which provides an additional hedge over the Fund’s GBP exposure.

Non-technology businesses are also increasingly interested in making deep-tech acquisitions, where they look to gain a strategic benefit or competitive advantage against rivals by acquiring a portfolio company’s technology. These companies are most likely to be existing customers or partners (or possibly one of their direct competitors).

In terms of timing for such technology-driven exits we look at how the technology fits into the business eco-system at the time, the degree of competitive tension and the perceived uniqueness of the technology. The level of revenues is not the only metric for early-stage technology acquisitions - at most it may validate that there is a potential market - but more likely, acquirers want to control the technology internally, or even just to acquire the skills of the team - and so customer traction may even detract from realising value in these cases.

Another key consideration is our assessment of how long the technology is likely to remain unique or competitive, which affects the timescale that we consider in which to optimise the exit value.

Key team

Isabel Fox - General Partner and co-Founder

Isabel Fox is a mother, wellness coach, Peloton enthusiast and one of just a handful of female General Partners in the UK. Prior to founding Luminous Ventures, Isabel was head of Venture Capital at White Cloud Capital where she focused on early stage investments in life sciences and healthcare. With a background in investment banking and private equity turnarounds, Isabel founded and exited two corporate communications firms focused on the route to exit, co-founded two software start-ups (one exit) and been an active angel investor in the UK and US. She has worked in New York, San Francisco and London.  At Luminous Ventures, Isabel has the opportunity to invest in visionary founders with breakthrough technologies, and backing deep-tech and science that matters.  

Lomax Ward - General Partner and co-Founder

Max was previously a healthcare and life science investor at White Cloud Capital, making venture and growth capital investments in Europe and Asia across a range of indications, technologies and services.  Having graduated from the University of Cambridge, Max started out as a corporate lawyer at Slaughter and May in London, Milan and Tokyo, sitting in the TMT and IP group.  There he worked on, among other things, technology IPOs and M&A, giving him a taste for the commercial and investment side.  His experience in intellectual property and regulation is particularly useful for the deep technology companies in which Luminous invests. Outside of the office, Max is often to be found trail running in the mountains or (where he can't get away) the Surrey Hills.

Dr. Peter Crane - Principal

Peter is a scientist discovering the potential of technology to disrupt traditionally siloed and deeply technical scientific industries. Despite his pivot away from his background in therapeutics, he still appraises deep technology platforms with the same rigour common to the biopharma industry. Whilst the inflections in deep tech may be different to therapeutics, a commitment to quality science, a thorough understanding of the patient or customer need, and a clear capital efficient plan to execute are commonalities. He currently works in corporate strategy at Synthace, and before this was working in healthcare investment roles and with deep technology start-up accelerators. He has a DPhil in Chemical Biology from Oxford University, a master’s in chemistry (top of year) from Warwick Uni and experience in biopharma R&D. Outside of work, Peter is a huge animal lover, his favourite animals being the Beagle and as per his namesake, the Heron. He is also passionate about spending time outdoors and as such loves spending his summers surfing.



Dr. Miao He - Associate

Miao He is a scientist passionate about the potential of new technologies bringing changes to all aspects of our lives. Previously she worked as a Bioinformatics Scientist at Illumina, where she combined genetic and computational approaches to interpreting genomic sequencing data to help deliver better cancer management. At Illumina she worked with early members of Solexa and collaborated with key opinion leaders in academia and Genomics England on the 100,000 Genomes Project. Miao has consulted for Cancer Research UK and healthcare/biotech businesses and has worked in early-stage investing at OurCrowd, a venture capital firm in Israel. Miao has a Ph.D. in Molecular Biology from the University of Cambridge and an MBA from London Business School. Miao is the author of 14 peer-reviewed publications and has first-author papers in high-impact journals such as Nature Genetics. Her research has been featured in the Guardian, BBC News, LA Times etc.


Risks

Investment into early stage, unquoted companies, by its nature, involves a high degree of risk. Proper information for determining the value of such investments or the risks to which such investments are exposed may not be available. Investment in such companies can offer good potential investment returns but the markets for their shares are often illiquid and uncertain. Consequently, investment in smaller and unquoted companies is likely to involve a higher degree of risk than investment in larger or quoted companies. Realisation of investments in unquoted companies can be difficult and may take considerable time. Further, technology or scientific research – related risks may be greater in unquoted companies.


Smaller companies generally may have limited product lines, markets or financial resources and may be more dependent on their management or key individuals than larger companies. Although LV Fund II will receive conventional venture capital rights in connection with its investments, as a minority investor it may not always be in a position to fully protect its interests and the interest of its Investors.

Early stage companies often require a series of investment rounds and additional investment may be required to maintain or increase the growth of the portfolio company. Failure to achieve these capital requirements may negatively impact the company’s ability to grow and realise returns for investors, whereas subsequent investment is likely to dilute an investor’s shareholding in a portfolio company.

Fees

Management Fee:

During the Investment Period (first 4 years): 2% on invested capital (this comes out of the total subscription amount and is not on top of that amount).

For remainder of Fund life (6 years): 2% on lower of (i) invested capital and (ii) book value (this comes out of the total subscription amount and is not on top of that amount).


Carried Interest:

20% on any profits AFTER return of all capital and 8% preferred return to investors.

30% on any profits over a 3x multiple of money for investors.


CoInvestor will receive an introduction fee of up to 2% on any investment payable by the fund manager.


The content above has been provided by Luminous Ventures who are authorised and regulated by the Financial Conduct Authority under firm registration number 927589.