Imperial Innovations Group Regulatory News (IVO)

RNS REACH

31 May 2016

Imperial Innovations Group plc

Featurespace closes £6.2 million funding round

Imperial Innovations Group plc (AIM: IVO or 'the Group', 'Innovations') announces the completion of a £6.2 million funding round in Featurespace (the "Company"), the Cambridge-based Adaptive Behavioural Analytics company focused on the detection and prevention of fraud in the financial services and gaming sectors.

Innovations has committed £2.5 million to the round alongside new co-investor TTV Capital, a leading US venture company focused on early-stage fintech companies, which contributed £2.4 million to the round. The balance was made up by existing investors, including Nesta and a number of members of the Cambridge Angels group.

As at 31 January 2016, Innovations had invested £3.9 million in Featurespace with a net carrying value of £6.8 million. As a result of this new investment, the Group has a 36.9% undiluted stake in the Company.

Featurespace is an Adaptive Behavioural Analytics company which has the ability to develop an understanding of normal patterns of behaviour and anomaly detection for individuals in real time. The Company has developed a machine learning software platform, the behaviour analytics engine (ARIC) that monitors every individual, one customer at a time, to deliver real-time decision capabilities. The technology is based on Bayesian statistics and research undertaken at the University of Cambridge by the late Professor Bill Fitzgerald and Featurespace CTO, David Excell.

Featurespace's products provide significant economic benefits to their customers, providing a granular view of transactions allowing them to predict likely fraud and take appropriate action. The software learns individuals' behaviour and therefore produces a significantly higher level of accuracy identifying fraud and a lower level of false positives compared to competing solutions.

Featurespace's growing customer base includes companies such as Vocalink/Zapp, CallCredit and KPMG in financial services, and Betfair, William Hill and Camelot in gaming and lotteries.

Jon Edington, Director Technology Ventures at Imperial Innovations, added:

"This new funding round reflects the great progress Featurespace has made over the last year, including announcing major new customer wins with companies based in the USA. The most recent of these is a new partnership with TSYS Inc, one of the world's largest payment solutions and services companies, in which Featurespace's adaptive behavioural analytics platform will be used to reduce fraud for TSYS' clients.

 "Featurespace's strong management team has an impressive track record of building B2B software businesses. They are targeting a growing global fraud detection market which was worth $2.4bn in 2014 and is growing at 30% per annum, according to Forrester.

"This new funding will enable the Company to expand its operations in the UK and US and to continue to grow its expansion in financial services."

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Notes to editors

About Imperial Innovations - www.imperialinnovations.co.uk 

Imperial Innovations Group plc ("Innovations") creates, builds and invests in pioneering technology companies and licensing opportunities developed from outstanding scientific research from the 'Golden Triangle', the geographical region broadly bounded by London, Cambridge and Oxford. This area has an unrivalled cluster of outstanding academic research and technology businesses, and is home to four of the world's top 10 universities, as well as leading research institutions, the cream of the UK's science and technology businesses and many of its leading investors.

Innovations supports scientists and entrepreneurs in the commercialisation of their ideas, through the licensing of intellectual property, by leading the formation of new companies, by recruiting high-calibre management teams and by providing investment and encouraging co-investment. Innovations remains an active investor over the life of its portfolio companies, with the majority of Innovations' investment going into businesses in which it is already a shareholder.

Since becoming a public company in 2006, Innovations has raised more than £430 million of equity from investors, which has enabled it to invest in some of the most exciting spin-outs to come out of UK academic research. In addition, the Group has agreed £80.0 million in loan facilities from the European Investment Bank (EIB).

Between Innovations' admission to AIM (August 2006) and 31 July 2015, Innovations had invested a total of £236.8 million across its portfolio companies, which had raised collectively investment of £1.3 billion.

About TTV Capital - www.ttvcapital.com

Founded in 2000, and based in Atlanta Georgia, TTV Capital focuses entirely on investing in early-stage financial technology companies. The firm has raised more than US$210 million across three funds in 2000, 2005 and 2011. Our team of experienced technology and financial services professionals has more than 100 years of venture capital and highly relevant industry operating expertise acquired across three decades and multiple economic cycles.