Criteria for considering potential investments from Simula Innovation

When Simula considers investing in a start-up company, the company is evaluated according to the below criteria. The commercial and technical due diligence will be presented in a report that consist of three parts. Part A) and B) relates to commercial risk and business opportunities. This section will receive a response from the leader of SI. Part C) relates to technology and is written by the leader of Simula’s technical board.

Based on the conclusion in the report the leader of SI will within the mandate of the board make a decision on Sis investment and participation in the company.

A) Assessment of commercial risk and business opportunities

Problem and solution

  1. What is the product and which problem does it solve?
  2. Which new opportunities does the solution provide?

Product market potential

  1. Which competitors are already in the market and which competitors are likely to enter the market in the future?
  2. What is the demand for the product in the market?
    • Description of the market in which the product will be launched
    • The demand should be quantified when possible
  3. Which market will be attacked first and what are the realistic market shares in the long run?

Business model

  1. Description of value chain
    • Which customers will be focused on: end customer, supplier or producer?
    • Any individual stakeholders in the value chain worth mentioning?
    • Which potential customers have the highest demand?
  2. Product pricing
    • Production costs
    • Margins
    • Pricing and payment solution
  3. The road to the market
    • Leads and pilot customers, customers and partners
    • Sales and marketing plan
    • Budget revenue

B) Team

  1. What is the team’s overall commercial competence as a group?
  2. What is the team’s overall technical competence as a group?

C) Technology

  1. Has the problem been solved before?
    • Is the new solution better? Can this be demonstrated?
    • Cheaper?
    • More stable?
    • More secure?
    • Other valuable qualities for customers?
  2. Is there a prototype?
    • Can it be demonstrated?
    • Is it based on published solutions?
    • Is it based on patented solutions?
  3. Who owns the technology?
    • Has external or open software been used?
    • Can it be used for commercial purposes?
    • Which standards are used for implementation?
    • How is the software and the product tested?
    • What remains for the product to be ready for sales?