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2000 hospitals at £9000 per annum gives revenues of £18MM and earnings of £13.5MM. On a p/e of 15 that is just over £200MM. At 5000 hospitals you reach a valuation of £500 million. However FVR are currently opening up a lucrative new market in VR/AR applications for pharmaceutical devices (£650k contracts with 1 provider in last 6 months) and see great potential for monetising the data gathered from their surgical
simulation product. I would therefore think that a reasonable range of outcomes for FVR would be £700 million to £1 billion.
As I said this is a very conservative approach. It is not unrealistic to assume that the number of hospitals that buy the platform will be higher than 5000 ( there is a significant cost/benefit return for them). As more procedures become available the average price per hospital will rise. And many hospitals will probably purchase more than 1 system. Early days yet for this one but it is a very exciting proposition.

Johnma26 Oct '19 - 19:06 - 172608 of 172632
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We are just at 14.25p

Detailed Analysis of Portfolio Companies Device Authority hxxps://www.deviceauthority.com This company is focussed on securing the billions of devices that will be connected over the coming years. Traditional methods of protecting computers and servers with firewalls and anti virus software are not relevant for IOT devices. Data coming from devices to IOT platforms and ultimately to the cloud will have to be protected on the device and as it travels. Device Authority CEO Presentation This video is from the June Capital Markets Day delivered by Darron Antill their CEO. hxxps://www.techrepublic.com/article/iot-security-market-will-hit-9-88b-by-2025-as-privacy-issues-abound/ hxxps://www.marketsandmarkets.com/Market-Reports/iot-security-market- 67064836.html?gclid=EAIaIQobChMItOys2Zj53gIVlM13Ch0YRwx1EAAYAiAAEgIVx_D_BwE&gclid=EAIaIQobChM ItOys2Zj53gIVlM13Ch0YRwx1EAAYAiAAEgIVx_D_BwE There are numerous reports available presenting a common theme. The IOT market is exploding and there are significant concerns about the security of the devices and the data that they will generate. The figures presented above are based on per annum revenues and they are projected to continue growing through to 2035. Like all small cyber companies the information in the public domain is limited to some extent. The dilemma these companies face is that they need to present success to the industries whilst at the same time not giving so much away as to attract the attention of their competitors. That means that you have to dig deeply to try to get a feel for how things are developing. There is no doubt that Device Authority were slower to gain traction than many had hoped. That appears to have been more about slower than anticipated IOT market growth and M&A activity among their partners. In addition Device Authority have narrowed their focus in the last 12 months to the healthcare, industrial and automotive sectors. Device Authority have an ecosystem of partners with whom they are developing solutions in the medical, automotive, industrial, financial payments and telecoms arenas. These partners can be viewed on their website but include Microsoft Azure, IBM, Dell, AWS, Intel, AT&T, GE, Thales, Gemalto, PTC, Entrust(nCipher), Digicert, Identrust and Sectigo. Certainly an impressive list but is it more than a simple marketing ploy. Are the partners actively working with Device Authority on solutions? The simple answer is that it appears to be mixed. Some partners appear to be more active than others. Microsoft Azure, PTC Thingworx, Intel, Thales and Gemalto are certainly to the fore. Others appear to be much quieter although something may be going on in the background. They launched products with Thales in the medical market in July 2018 and with Sectigo a leading security certificate company in Sept 2018. Device Authorities Keyscaler product is the engine for Sectigos PKI Manager

Johnma27 Aug '19 - 09:31 - 162799 of 162822
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Device Authority
https://www.deviceauthority.com
This company is focussed on securing the billions of devices that will be connected over the coming years. Traditional methods of protecting computers and servers with firewalls and anti virus software are not relevant for IOT devices. Data coming from devices to IOT platforms and ultimately to the cloud will have to be protected on the device and as it travels.
Device Authority CEO Presentation
This video is from the June Capital Markets Day delivered by Darron Antill their CEO.
https://www.techrepublic.com/article/iot-security-market-will-hit-9-88b-by-2025-as-privacy-issues-abound/
https://www.marketsandmarkets.com/Market-Reports/iot-security-market- 67064836.html?gclid=EAIaIQobChMItOys2Zj53gIVlM13Ch0YRwx1EAAYAiAAEgIVx_D_BwE&gclid=EAIaIQobChM ItOys2Zj53gIVlM13Ch0YRwx1EAAYAiAAEgIVx_D_BwE
There are numerous reports available presenting a common theme. The IOT market is exploding and there are significant concerns about the security of the devices and the data that they will generate. The figures presented above are based on per annum revenues and they are projected to continue growing through to 2035.
Like all small cyber companies the information in the public domain is limited to some extent. The dilemma these companies face is that they need to present success to the industries whilst at the same time not giving so much away as to attract the attention of their competitors. That means that you have to dig deeply to try to get a feel for how things are developing.
There is no doubt that Device Authority were slower to gain traction than many had hoped. That appears to have been more about slower than anticipated IOT market growth and M&A activity among their partners. In addition Device Authority have narrowed their focus in the last 12 months to the healthcare, industrial and automotive sectors.

Device Authority have an ecosystem of partners with whom they are developing solutions in the medical, automotive, industrial, financial payments and telecoms arenas. These partners can be viewed on their website but include Microsoft Azure, IBM, Dell, AWS, Intel, AT&T, GE, Thales, Gemalto, PTC, Entrust(nCipher), Digicert, Identrust and Sectigo.
Certainly an impressive list but is it more than a simple marketing ploy. Are the partners actively working with Device Authority on solutions? The simple answer is that it appears to be mixed. Some partners appear to be more active than others. Microsoft Azure, PTC Thingworx, Intel, Thales and Gemalto are certainly to the fore. Others appear to be much quieter although something may be going on in the background.
They launched products with Thales in the medical market in July 2018 and with Sectigo a leading security certificate company in Sept 2018. Device Authorities Keyscaler product is the engine for Sectigos PKI Manager ( and they recently won a prestigious award for their PKI Manager).

Johnma27 Aug '19 - 09:30 - 162798 of 162822
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Fundamental VR
https://www.fundamentalvr.com
FVR CEO Presentation
This has rapidly moved up to compete with Device Authority as Terns premier holding. Tern raised their stake in FVR to about 35% in Oct 2018.
FundamentalVR have developed a virtual reality training package for surgeons currently offering 3 procedures, but expecting to add several more before year end with significant growth in procedures through 2019.
The price for 1/2/3 procedures is £6000/£9000/£12000 per annum respectively. Take up has been rapid with last known figures of 50 hospitals taking up the platform. With about 80,000 hospitals globally there is a huge prize to go after.
FVR partnered with The Mayo Clinic in the US to further develop and sell their platform in the US and have also launched in the UK and AUS/NZ.
This company has huge press coverage. The current method of training surgeons relies on expensive cadavers and theatre experience. The platform allows surgeons to train and practice their operations in a safe VR environment.
Growth will be rapid here in my opinion as already witnessed by the immediate take up. There is evidence at companies house that Tern have extended a bridging loan to FVR pending negotiations into an investment by one or more VC’s. I expect to see news of that soon and an accompanying higher valuation for FVR.
In terms of valuing the company I have taken a conservative approach. I assume an average take up per hospital of 2 procedures, and use for the base case 2000 hospitals and the upside case 5000 hospitals. I also assume costs of 25% of revenues. Again this should be a high margin business. I also use a lowly p/e of 15. I will modify my assumptions as more information becomes available.
2000 hospitals at £9000 per annum gives revenues of £18MM and earnings of £13.5MM. On a p/e of 15 that is just over £200MM. At 5000 hospitals you reach a valuation of £500 million. However FVR are currently opening up a lucrative new market in VR/AR applications for pharmaceutical devices (£650k contracts with 1 provider in last 6 months) and see great potential for monetising the data gathered from their surgical

simulation product. I would therefore think that a reasonable range of outcomes for FVR would be £300 million to £700 million.
As I said this is a very conservative approach. It is not unrealistic to assume that the number of hospitals that buy the platform will be higher than 5000 ( there is a significant cost/benefit return for them). As more procedures become available the average price per hospital will rise. And many hospitals will probably purchase more than 1 system. Early days yet for this one but it is a very exciting proposition.

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