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Invest in Photonics: Big Industries Stepping Up Investments

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Participation at Invest in Photonics 2014, a two-day international business partnering convention for business angels, VCs and corporate ventures, grew to 170 attendees this year, an increase of 13 percent. This was the first year the event included investors from the crowdfunding community and traders, signaling a broadening attraction in alternative funding.

At the Oct. 9-10 event, 20 early- to late-stage pan-European photonics firms pitched investors to target a cumulative total of €70 million in funding. This figure was in line with the 2012 event’s funding target. Investors attending the event plan to pursue next-phase discussions with 13 of the companies that presented.

Many of the VCs in attendance acknowledged that investment in early-stage photonics companies is becoming rare, but they recognized that there has been an “explosion of corporate ventures, which are filling the VC gap,” as venture partner Alessio Beverina said. Beverina has seen the number of corporate deals and partnerships rise steadily from 133 in 2005 to a peak of 330 in 2010, with an approximate value of €1.5 billion in deals.

Netherlands-based Effect Photonics, a developer of DWDM (dense wavelength-division multiplexing) system-on-chip-based modules to decrease the complexity and increase the energy efficiency in data centers, won the Invest in Photonics award for most promising company in the photonics market. Second- and third-place honors went to, respectively, Finnish firm Valkee, a maker of light headsets to dissipate winter blues, and LUXeXcel, a Dutch company providing processing technology for 3-D printed optics (see article by LUXeXcel on page 18).

“We have seen a significant increase in the business relevance and quality of the investment opportunities presented this year,” said Giorgio Anania, chairman of this year’s Invest in Photonics. “The key takeaway for photonics startups is to ride the shift from VC to new funding sources such as corporations, business angels and alternative financing that were presented during the event.”

This year, Invest in Photonics emphasized four market segments that use photonics extensively: consumer electronics, the life sciences, aerospace and transportation, plus energy and the environment. Speakers representing these industrial sectors gave examples of the gaps in innovation that they are looking to fill: automation control, energy conversion efficiency, signal processing, health care and biophotonics, silicon photonics in the migration from telecom networks to data centers, and more.

Green photonics came up as another expanding segment that is garnering investor interest. This area is interesting for VCs because it has real problems to solve, and it offers a huge market size and high growth potential. “VCs will continue to invest in photonics technologies if there is a strong market driver, such as regulations, incentives, needs for lower costs, significant growth in demand, etc.,” Beverina said.

Dec 2014
Euro NewsEuropeopticsDWDMModules3-D Printed Optics

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