How we work
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Introduction
SalusInvest LP and SalusInvest General Partners Ltd were founded in 2004. The expertise and experience of the original founders were based on over twenty years of operating experience in building three, successful business groups : Warne Surgical sold to Teleflex Inc in 1985; Bioquell plc started in 1990; Ferraris Group plc started in 1996. They operated in four principal medical technology markets:
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urological catheters and surgical drainage devices
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anaesthesia devices and consumables
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respiratory and cardiology diagnostic devices and consumables
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healthcare contamination control & HPV bio decontamination.
Since 2004, SalusInvest has invested in various medical devices and medical diagnostic technologies amongst them: OCT lasers, MRI & CT diagnostic scanners, ferromagnetic protection devices , MRI ,CT ,X- Ray and RF imaging and image analysis technologies using A.I. machine learning protocols and specialised equipment for the handling and freezing of proteins in the X ray diffraction industry.
SalusInvest does not invest in drug delivery, gene therapy, pharmaceuticals, OTC medicines or vaccines. Portfolio companies are based mainly in the U.K. but where the majority of sales and services supplied are exported across Europe, principally Germany, France, Italy and Holland and in the USA. SalusInvest has made all of its investments in private, UK early stage companies. These companies were originally loss-making and the funding of the portfolio companies in their early stages has come in the main from SalusInvest, private high net worth individuals and from venture capital companies. SalusInvest always takes a senior board position in each of its portfolio company investments.
Strategy
SalusInvest normally focuses on the risk and return characteristics of an investment rather than those criteria that are normally used to define venture investments. Nevertheless the investments are normally only made in medical technology businesses.
The principal characteristics of an ideal portfolio company investment would include the most of following:
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A platform technology which has a least two principal market applications where the potential addressable global market is at least $300 million p.a. for each application.
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The market applications address a genuine global, customer need which leads to improved patient outcomes, improved customer productivity and cost savings for the customer and user.
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Where large companies within the addressable market can become customers of the business’s products or services.
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Intellectual property which is either patent protected or has highly confidential, unpatented algorithims or software.
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Where the Company's revenues can enjoy high gross margins in the 60% plus region and where the business can begin to become profitable in EBITDA terms on revenues of ~$5 million p.a.
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Where the Company's revenues are mainly outside the U.K. and of a recurring nature arising either from the use of services, single use devices or single use consumables or from a business model which generates revenues on a fee per use basis without the need for sales of capital equipment.
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Where the total investment funds needed by the Company before it begins break even is in the $10-$15 million range.
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Where the senior management team includes at least one executive who is experienced in the markets addressed by the Company and where others in the team are industry relevant with technology, management or sales experience.
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Where the portfolio company board has one or more industry relevant non executive directors with experience of managing multi site business groups in the medical technology industry in Europe and North America.
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Where a trade or another Exit event can be achieved within 5 to 10 years
SalusInvest will only invest in companies based in the UK but where the majority of the potential revenues arise from North America and from Europe.
Investment approach
SalusInvest maintains a set of stringent criteria for selecting portfolio companies. Whilst not all of these criteria need be satisfied in every instance, they form the basis for investment decisions:
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A portfolio company should have plans to develop products that address a medical technology market around the world and should not be limited to the market in the U.K.
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We look for a clearly differentiated, disruptive technology that is world-class. The technology must be protected by patent or by confidential, proprietary software or algorithms.
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The business model should not only deliver improved patient outcomes when used clinically but also deliver improved productivity to the clinician and reduce cost to both the clinician and if possible the patient. A recurring revenue model, using a fee per transaction or the use of consumables on a device, is preferable to a capital sale business model.
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A management team and a board in place where at least one of the senior managers has experience in the industry that is being addressed with the technology. The board should have non executive directors where the Chairman at least has experience of managing a multinational, multi site group of companies and where some of the non executives have experience of leading successful trade exits.
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We expect most of the investments, if successful, to be ready for an exit within a 5 to 10 year period from the initial investment by SalusInvest. As a consequence we normally seek portfolio companies who are able to break-even in cash and profit terms once they reach a revenue level of ~$5 million p.a and where the funding requirements to attain that level of funding is no more than $10 to $15 million.
Company
SalusInvest LP was founded in 2004 and is a small, private family investment fund in the form of a partnership that invests in medical technology companies. It does not raise funds from any sources other than from the general partners of SalusInvest LP.
SalusInvest is not FCA registered.
SalusInvest General Partners Ltd and its related business KDS Associates act as managers of SalusInvest LP.
Registered addresses on request.
