Tekcapital Spins out GenIP onto AIM

Tekcapital plc (AIM: TEK), the UK intellectual property investment group focused on creating valuable companies from investing in university technologies that can improve people's lives, is pleased to announce that its recently formed subsidiary GenIP ("GenIP") has completed its initial public offering ("IPO") on the AIM market of the London Stock Exchange plc, following which it is now 63% owned by Tekcapital.

GenIP, a technology business operating within the Generative Artificial Intelligence (GenAI) space, providing complementary platform-based services, is pleased to announce the admission of its entire issued share capital to trading on AIM, at 8.00 a.m. today under the ticker 'GNIP' ("Admission"). GENIP's Admission Document, as well as other information required pursuant to AIM Rule 26, are available on GENIP's website www.genip.ai.

Admission follows a Placing of 3,799,231 new ordinary shares by Novum Securities Limited ("Novum"), as well as a Subscription of 687,948 new ordinary shares, for a combined total of 4,487,179 new ordinary Shares at 39p per new ordinary share (the "Fundraising Price"), raising gross proceeds of £1.75 million (increased from an original target fundraise of £1.5m), before expenses (the "Fundraising"). Novum acted as Sole Broker and Beaumont Cornish Limited acted as the Nominated Adviser in relation to the Admission.

This is the fourth flotation from Tekcapital's incubator and the second this year following the successful IPO of MicroSalt in January.

Admission Statistics:

Clifford Gross, Executive Chairman of Tekcapital said:

"We are excited to announce the IPO of GenIP plc., a terrific new company that we think can make a positive impact by helping its customers bring new innovations to market. With a significantly compressed gestation period, this IPO has resulted in a significant return on invested capital for our shareholders. We are looking forward to hopefully delivering further impactful results in future transactions using Tekcapital's accelerated incubation process."

Tekcapital holds 11,050,769 ordinary shares of GenIP which are subject to a 12-month lock-in period from the date of admission. This included 250,769 new ordinary shares which Tekcapital subscribed for in the fundraising at the fundraising price. Additionally, Tekcapital holds 250,769 warrants exercisable for a period of 3 years from the date of Admission at 10% above the IPO price.

About GenIP

GenIP® provides GenAI analytic services to help companies, research institutions and venture funds assess and commercialise new discoveries. GenIP combines expert human technical review with GenAI algorithms to provide insightful and verified services.

GenIP provides two complementary platform-based services:

• Invention Evaluator: Provides bespoke research reports that assess the market potential of new technological innovations and discoveries using AI-driven proprietary software; and
• Vortechs: which is an executive recruitment platform that through advanced machine learning algorithms and natural language processing technologies assists in matching technology organisations with experienced executives and business leaders.

GENIP believes that its integrated GenAI service offerings will help organisations to evaluate and commercialise their technological innovations.

Strategy

GenIP's goal is to create a leading Generative AI analytic services company. To achieve this, the GENIP has established three strategic pillars:

Work Programme and Use of Proceeds

The gross proceeds of the Fundraising are principally expected to be used to:

• launch a comprehensive ecommerce sales and marketing programme (approximately £450,000);
• provide general working capital for GENIP (approximately £750,000); and
• meet the costs and expenses of the Fundraising and Admission (approximately £550,000).

Board of Directors

Lord David Willetts - Non-Executive Chairman

The Rt Hon Lord Willetts FRS is Chairman of the U.K. Space Agency, President of the Resolution Foundation and former U.K. Minister for Universities and Science. He served as the Member of Parliament for Havant (1992-2015), and previously worked at HM Treasury and the No. 10 Policy Unit. Lord Willetts is also a visiting Professor at King's College London, former Chair of the British Science Association and a member of the Council of the Institute for Fiscal Studies. Lord Willetts is a graduate of Oxford University.

Melissa Cruz - Chief Executive Officer

Melissa as part of her CEO function helps global clients create marketplace value from university-developed IP. With a background in marketing and sales, Melissa collaborates with a diverse set of organizations in the United States, China, Europe, and Latin America to facilitate technology transfers between developed and developing countries. Melissa received her B.A. in International Business and an M.S. in Marketing from Florida International University.

Kevin Fitzpatrick - Chief Financial Officer

Kevin is a CFO/Finance Director with over 20 years' experience in SME and entrepreneurial businesses across various sectors and industries including Tech, SaaS, Media, and Retail. He has held numerous board positions with both quoted public and private businesses with full executive responsibility for finance, legal and corporate finance. He graduated from University College Dublin with a BA(Hons) in Economics and qualified as a Chartered Accountant with Deloitte.

David Gann - Independent Non-Executive Director

Professor David Gann CBE is a business leader, chairperson, former University leader, and non-executive director with a reputation for creating and supporting innovation and growth, and mentoring science-based start-ups. He is a leader in the development of fusion energy, as Chair of UK Industrial Fusion Solutions, and previously Chair of the UK Atomic Energy Authority. He is a non-executive director of VenCap International plc, a leading venture fund-of-funds. David is an entrepreneur, having formed several companies, mentors start-ups, and advises Boards. He has been non-executive director of Directa Plus plc, currently on the Advisory Board of Euroclear and was Group Innovation Executive at Laing O'Rourke plc.

Tekcapital's Technology Incubation Process

Tekcapital is a technology transfer company that acts as a catalyst, transforming research into tangible products and services that can benefit society and produce above average returns on invested capital. We play a vital role in fostering innovation and bridging the gap between academia and industry by delivering products and services that can improve the quality of life of the customers we serve.

As demonstrated with the flotation of GenIP, Tekcapital creates value by applying the following process:

Identifying and Assessing Technology Readiness:

Using our global proprietary network, we seek to uncover promising technologies from research institutions and assess the commercial potential of these technologies.

Intellectual Property Protection:

We selectively acquire and develop patents or other forms of intellectual property protection to secure exclusive rights to the intellectual property.

Market Research and Analysis:

We identify potential markets and target audiences for the technology.

Competitive Analysis: We assess the competitive landscape to understand market dynamics and pricing.

Company Formation:

We build new companies to develop, manufacture, and sell the new products and services that utilise the technology we have acquired.

Secure Leadership:

Identify and onboard board and senior management with star power.

Provide Initial Seed Financing & Support:

We invest in and assist in securing funding from external sources, when possible, for research, development, and commercialisation efforts. Additionally, we provide operational support when needed.

Value Creation:

We own equity stakes in the start-ups we have developed or have invested in and seek to spin-off these companies to accelerate the commercialisation of the technology and deliver a return on the capital we have invested for our shareholders.

Tekcapital utilised the above process to incorporate and build GenIP and contributed two of its assets Invention Evaluator and Vortechs, which were valued on 30th of June at US$191,564. In 2024, Tekcapital created two new products by integrating existing GenAI large language models into these assets.

At GenIP's IPO price of 39p, Tekcapital 63% stake in the business is now worth ~£4.3 million ($5.76m) representing a significant return on the net book value of the assets transferred into GenIP.

For this transaction, we have delivered a strong return on invested capital for what would normally require a substantially longer period compared with the traditional venture capital model. According to data from the American Venture Capital Association, the average time to realise an exit from a venture capital investment is around 5-7 years from the initial funding and to achieve 10x multiples it usually takes 8 years or more.[1]

Tekcapital believes its technology incubation process helps to mitigate adverse selection and accelerates the commercialisation of early-stage technologies which can result in above average returns on invested capital.

About GenIP Plc

GenIP® provides generative artificial intelligence (GenAI) analytic services to help companies, research institutions and venture funds assess and commercialise new discoveries. GenIP combines expert human technical review with GenAI algorithms to provide insightful and verified services. GenIP is quoted on the AIM market of the London Stock Exchange (AIM: symbol GNIP) and is headquartered in the UK. To learn more about GenIP, please visit www.genip.ai.

Clifford M. Gross, Ph.D.

Richard Morrison/Charlie Bouverat (Corporate Finance)/Abigail Wayne / Rob Rees (Corporate Broking)

Tim Thompson/Andrea Seymour/Fergus Mellon

General Risk Factors and Forward-Looking Statements

Investors must rely on their own examination of the legal, taxation, financial and other consequences of an investment in the Company, including the merits of investing and the risks involved. Prospective investors should not treat the contents of this Press Release as advice relating to legal, taxation or investment matters and are advised to consult their own professional advisers concerning any acquisition of shares in the Company. Certain of the information contained in this Press Release has been obtained from published sources prepared by other parties. Certain other information has been extracted from unpublished sources prepared by other parties which have been made available to the Company. The Company has not carried out an independent investigation to verify the accuracy and completeness of such third-party information. No responsibility is accepted by the Company or any of its directors, officers, employees or agents for the accuracy or completeness of such information.

Tekcapital's mission is to create valuable products from university intellectual property that can improve people's lives. Therefore, our ability to compete in the market may be negatively affected if our portfolio companies lose some or all of their intellectual property rights, if patent rights that they rely on are invalidated, or if they are unable to obtain other intellectual property rights. Our success will depend on the ability of our portfolio companies to obtain and protect patents on their technology and products, to protect their trade secrets, and for them to maintain their rights to licensed intellectual property or technologies. Their patent applications or those of our licensors may not result in the issue of patents in the United States or other countries. Their patents or those of their licensors may not afford meaningful protection for our technology and products. Others may challenge their patents or those of their licensors by proceedings such as interference, oppositions and re-examinations or in litigation seeking to establish the invalidity of their patents. In the event that one or more of their patents are challenged, a court may invalidate the patent(s) or determine that the patent(s) is not enforceable, which could harm their competitive position and ours. If one or more of our portfolio company patents are invalidated or found to be unenforceable, or if the scope of the claims in any of these patents is limited by a court decision, our portfolio companies could lose certain market exclusivity afforded by patents owned or in-licensed by us and potential competitors could more easily bring products to the market that directly compete with our own. The uncertainties and costs surrounding the prosecution of their patent applications, and the cost of enforcement or defence of their issued patents could have a material adverse effect on our business and financial condition.

[1] https://www.industryventures.com/insight/the-venture-capital-risk-and-return-matrix/