Hear from Charles Gillies, MD, Head of RCF Innovation Investment Committees, discuss a recent exit from SciAps, a Boston-based, high-growth specialist provider of handheld instruments leveraging X-ray Fluorescence (“XRF”) and Laser Induced Breakdown Spectroscopy (“LIBS”) techniques for materials analysis.
Hi, my name is Charles Gillies. I’m chair of the investment committee at RCF Innovation and one of the founders of the innovation strategy at RCF.
RCF innovation invests in companies that assist the mining industry to meet the critical minerals challenge. Our companies make mining safer, cleaner, and more efficient. There are many innovative companies that are now selling all sorts of exciting technologies and tools to the mining industry. Advances in sensors, in robotics, in artificial intelligence, and in remote operation mean that these companies can provide exciting innovations to help mining industries reduce their costs and to improve their productivity and to meet their ESG needs.
RCF innovation recently sold its holding in SciAps. SciAps is a Boston based manufacturer and distributor of handheld elemental analyzers. The investment thesis around SciAps was that it produced a handheld elemental analyzer. The benefit of this analyzer is that people could make decisions in real time on site, saving significant money and improving productivity. Before SciAps came along, ores, metals, and other materials could only be analyzed by taking samples and sending them to a lab and waiting days, weeks, or even months for the results to come back. The quick turnaround time of the analysis improved the productivity and cost position of many companies.
One of the reasons that we invested in SciAps was the strength of the management team. The team was led by Don Sackett, the CEO who had previously built and exited a business in instrumentation. He has a PhD in physics. He knows how to operate, grow, and sell in business in high technology. This is a very rare combination of skills.
Another important element of the investment thesis was to protectability of SciAps market and its position. SciAps was doing something which was very difficult to do, to create these handheld analyzers. There are very few other people who could do this to the level of quality and cost of the SciAps devices. This meant that SciAps was largely operating in blue ocean and was able to grow itself very quickly over the 10 years that we were involved.
RCF innovation provided value add to SciAps in a number of ways. Firstly, through our provision of early-stage equity finance. This can be a very challenging area as the company is still growing and has many pains. We have done a number of early-stage technology investments. In terms of growing early stage fast growing companies, there are often some common challenges which we had seen many times before. These included building sales teams, creating operational excellence, and being able to manufacture and distribute product adequately.
At RCF innovation, we think this is a very exciting time for innovation in the mining industry. The mining industry faces some significant challenges. The deposits are getting deeper, all grades are declining, and ESG requirements are increasing. All of these are having an impact on the cost and productivity of large mines. At the same time, the mining industry is being expected to significantly increase its production of critical minerals to assist in the energy transition. We believe, and we can demonstrate, that innovation in the mining industry will help the miners overcome these challenges, and this is what our companies provide. All of these things mean that it’s an exciting time for innovation and the mining industry is increasingly looking to companies of all sizes to provide them with the tools they need to be successful.
What’s discussed:
- SciAps exit overview
- Original investment thesis
- RCF value add
- Overview of RCF innovation strategy
- Opportunities in mining innovation
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