However, not all collaborations result in an acquisition. This is where venture capital funding comes in. A company can set aside a certain amount of money and use it to invest in companies and technologies that interest it.
In fact, INX International Ink Co. is doing just that, creating a $50 million venture capital fund. The objective is to make minority investments in materials science and technology start-ups related to the inks and coatings segment. Typical checks range from $1 million to $3 million at the start, with reserves for follow-on investments. The fund will pursue certain seed and growth stage opportunities.
Shane Bertsch, vice president of strategic planning and innovation for INX, said the fund is an additional tool that will help accelerate innovation in line with INX’s vision and strategy.
“We work to understand market needs and develop solutions for those needs,” added Bertsch. “We believe that startups can play a key role in providing solutions. The fund can make minority investments to help accelerate these start-ups.
INX International CFO Bryce Kristo noted that Sakata INX has its own program which allows INX to cover the market.
“There are a lot of concentric lenses,” Kristo said. “We haven’t invested yet, but we’ve done a lot of collaborative licensing efforts, some of which haven’t required investment. Our venture capital fund allows us to look at new technologies more quickly and show our commitment to the most complementary start-ups.
“We have a team looking for technologies that could be a good fit for us, and when we start finding them, we find the resources to put them in place,” Kristo said. “When we do a proof of concept, we are able to bring in experts from INX’s pool of talented people.”
Some of the areas of interest include bio-based and sustainable materials for ink and coating technologies that enable circularity and improve recycling, as well as solutions for reducing greenhouse gas (GHG) emissions and the carbon footprint.
Digital printing is another area of interest, including direct-to-object printing and new inkjet technologies and inks. Industrial automation and branded services are other areas of interest.
“We are looking for sustainable and circular economy solutions – raw materials, new technologies – as well as digital printing solutions, brand owner services and new ink technologies,” Bertsch said.
“A lot of solutions and investments overlap,” Bertsch said. “We use innovation techniques and, thanks to an extensive network, we have access to very interesting start-ups. We filter and propose the best opportunities that match our strategies. »
The fund is co-managed with Touchdown Ventures, the leading provider of corporate venture capital managed services. Will Geiger, Director of Touchdown Ventures, said Touchdown offers insight into where the market is headed.
“In addition to partnering with INX, many of these companies need capital,” Geiger noted. “The investment can strengthen the relationship and bring a lot of value to the start-up. We determine priority investment areas based on what we hear inside INX as well as the market. We build relationships with entrepreneurs, co-investors, attend industry conferences and events, and determine the quality and suitability of deals through due diligence.
Although INX has yet to announce any funding, Bertsch said INX management is considering finding new opportunities.
“This is a new fund and we are on track,” concluded Bertsch. “We expect to have news to report within the next 12 months.”
Kristo pointed out that opening a venture capital fund is a shift in how INX obtains new business.
“In the past, someone would come to us and we would pursue that, but what we should be targeting are people who can solve problems,” Kristo added. “In the past, that was what people we knew or who would come knocking on our door, maybe join in a discussion about mergers and acquisitions. But we spend a lot of money on that. We decided to target opportunities and communicate with the innovators. Touchdown can then come out and present them to us. This allows us to determine what we want to innovate in. This allows us to stay focused on what we want to innovate. This will allow us to have a lot more success.”