Praetura has supported SMEs since 2011, with the acquisition and listing of Inspired Energy PLC that year. Since then, we have grown steadily and made a further 38 investments into high growth tech- or IP-enabled small businesses on behalf of investors, investing over £130m. After our record-breaking Praetura EIS 2019 Fund, we successfully closed the Praetura EIS 2020 Fund in January, taking our total raised for the 19/20 tax year to £22m.
Headquartered in Manchester, we have built an enviable network across the region, generating strong deal flow and opportunities. We are motivated by the size of the opportunity offered by early-stage businesses in the North of England, and are well-positioned to capitalise upon it, with extensive experience and resources. Our investment team is one of the largest in the UK. This size, and the breadth of knowledge it brings, provides us with an exceptional capability to source and evaluate investment opportunities.
We focus on early-stage investment into businesses which operate in growing sectors that are closely aligned with the centres of excellence in the North. We invest in businesses which are enabled by innovative uses of technology or intellectual property. Investments typically range between £1m-£3m. In accordance with a diversified portfolio, this will provide business with start-up capital, seed capital and development capital to early-stage businesses.
The businesses we look to back all provide access to recurring, high margin, revenue streams and the opportunity for operational leverage once scaled. We are prepared to back these inherently scalable business models early. By making an early investment in a business, we can work with driven management teams at the foundational stages of a business and support them in growing successful ventures.
Key team members
Mike is former Managing Director at global investment bank GCA Altium and a Chartered Accountant (PwC). Mike is an experienced venture investor and adviser to some of the North’s leading entrepreneurs and investors. He cofounded Praetura in 2011 bringing with him specialisms in financial services, technology, ecommerce, support services and energy services.
David co-founded Praetura with a background of over 12 years in corporate finance and venture capital. He qualified as an ACA with KPMG and has considerable experience in backing financial services and recurring revenue businesses. David has a focus on the application of data, IT and technology to enable efficiencies within businesses.
Rob is an experienced chief financial officer, with over 18 years in senior financial leadership roles. Previously Rob was Group CFO at Arrow Global Group Plc, where he co-led the successful IPO on the main LSE in 2013 and the issuance of more than £1.5bn in the debt capital markets. Rob qualified as a chartered accountant with KPMG in Manchester and has served as financial director at Servisair Plc, Alfred McAlpine and Leeds Bradford International Airport.
Why Did We Invest? We saw a highly scalable business, with strong traction in the market, underpinned by recurring revenues and cashflows.
What Went Well? The business grew organically, but the major success was listing the business and then adopting an aggressive buy and build strategy, backed by supportive shareholders.
What Did We Learn? Recurring revenue with limited working capital provides a great platform from which a business can generate value either organically or by acquisition.
Why Did We Invest? We backed an exceptional entrepreneur and experienced team to capitalise on existing relationships and experience in a niche, but highly attractive, sector.
What Went Well? The start-up won clients immediately upon FCA approval and was profitable in its first year. Within 18 months, the initial capital had been repaid and by 2017, a £20m MBO was completed.
What Did We Learn? Backing exceptional teams with relevant experience in attractive markets provides an opportunity for super-normal returns. In this instance, it is all about the team.
Why Did We Invest? We backed a talented team to create a commercial lines broker, led and owned by its management.
What Went Well? The business was able to recruit teams and on-board clients quickly. Post our investment the business had the opportunity to achieve significant scale with the support of additional funding. We introduced and exited to Carlyle within 22 months, which provided a 3x return for investors.
What Did We Learn? Getting the right funding partner for a business is critical. We were the right funder to get the business off the ground and assisted the business to find the right follow-on-funder to deliver their ambitions.
Example portfolio companies
We’ve been growing our portfolio since 2011, and it includes some of the North West’s most exciting businesses. Sectors include creative, digital and tech; financial, professional and business services; energy and the environment, health and life sciences; and more.
Steamaco is an energy technology business headquartered in Manchester. Founded in 2012, it provides hardware and software, in the form of energy meters and a SaaS platform, to utility providers in emerging markets and low-connectivity environments. We co-led SteamaCo’s Series B round, alongside Shell Ventures, as we were impressed by the traction shown by the business so far, and we recognise their global ambition. Renewable mini-grid infrastructure is expanding significantly in developing countries and SteamaCo has demonstrated attractive forecasts and an enviable business model.
Patchwork, which has offices in London, Manchester and Liverpool, was founded by NHS doctors Anas Nader and Jing Ouyang in 2016 to help hospitals fill vacant shifts more cost-effectively and to stem the tide of clinicians leaving the health service due to poor work-life balance. More than 10,000 clinicians across over 30 hospitals already use the Patchwork app, with over 1 million shift hours booked since launch.
Sorted are transforming delivery and logistics for some of the biggest names in ecommerce. When we first invested in Sorted in 2013, we saw the size of the opportunity the company was looking at. We bought into their vision, and knew that a strong tech platform could make a massive impact in the world of logistics. Sorted has since become essential to companies such as ASOS, Lush and Missguided.
Dr Fertility Founded by Dr Lucy Buckley, PhD and Kobi McCardlein June 2018, Dr Fertility was created to address the problem of conflicting, unreliable information about fertility. There is a large market opportunity as infertility is an issue affecting 1 in 7 couples in the UK with no dedicated central point for support and guidance. Both founders are incredibly passionate about the market and we believe that they have the ambition and drive to deliver their business plan.
Peak is a Manchester based Artificial Intelligence company that has created an Artificial Intelligence System (AIS) which sits at the heart of a business, using machine learning algorithms to convert data into actionable insights to improve sales, reduce costs and drive higher profitability. The Peak system can be implemented alongside existing systems, with data being ingested quickly and at great scale.