1. Incorporation and Registered Office
Molten Ventures plc (formerly Draper Esprit plc) is a company incorporated in England and Wales with registered number 09799594 and its main country of operation is the UK. The registered office of Molten Ventures is 20 Garrick Street, London, England, WC2E 9BT.
2. Business Description
Molten Ventures is one of the leading venture capitalist investors involved in the creation, funding and development of high-growth technology businesses with an emphasis on digital technologies in the UK, the Republic of Ireland and the rest of Europe.
3. Corporate Governance
Molten Ventures complies with the UK Corporate Governance Code.
The Directors are responsible for the determination of the Group’s investment policy and setting the strategic aims and objectives of the Group, and have overall responsibility for the Group’s activities including the review of investment activity and performance. Fund management activities are delegated to Esprit Capital Partners LLP which is a wholly owned subsidiary and an FCA-authorised full-scope Alternative Investment Fund Manager with Firm Reference No. 451191.
The Board will meet at least six times per annum (and on an ad-hoc basis when necessary between the scheduled meetings), the Audit, Risk and Valuations Committee will meet at least three times per annum, and the Remuneration Committee and Nomination Committee will each meet at least two times per annum.
A copy of Molten Venture's Corporate Governance Statement released in July 2021 can be found HERE.
4. Board Members
The directors are as follows:
Karen Slatford (Independent Non-Executive Chair of the Board)
Karen is the Non-Executive Chair of the board of Molten Ventures and also chairs the Company’s Nomination Committee. She is also a senior independent non-executive director of AIM-quoted Accesso Technology Group plc and Softcat plc, and FTSE 250 IT infrastructure provider. Karen began her career at ICL before spending 20 years at Hewlett-Packard company, where in 2000 she became Vice President and General Manager Worldwide Sales & Marketing for the Business Customer Organisation, responsible for sales of all Hewlett-Packard products, services and software to business customers globally. Karen holds a BA Honours degree in European Studies from Bath University and a Diploma in Marketing.
Martin Davis (Chief Executive Officer)
Martin Davis was appointed as the CEO of Molten Ventures in November 2019. He has more than 20 years of experience in financial services having joined from Aegon Asset Management, where he served as the Head of Europe and the CEO of Kames Capital. Prior to Aegon Asset Management, Martin was the CEO at Cofunds; spent eight years at Zurich Insurance Group, and was CEO of Zurich’s joint venture, Openwork, the largest network of financial advice firms in the UK. Martin has also held senior management roles at Misys, Corillian, and Reuters and served for 11 years in the British Army. Martin has an MBA from London City Business School (CASS) and Diplomas from the Institute of Marketing and the Market Research Society.
Stuart Chapman (Chief Portfolio Officer)
Stuart Chapman is the CPO of Molten Ventures. Before he co-founded Molten Ventures, Stuart was a director of 3i Ventures in London. He has over 25 years of venture capital experience in Europe and the US – including founding 3i US in Menlo Park, CA. Stuart was responsible for Molten Venture’s investments in Lagan Technology (sold to Verint), Redkite (sold to Nice), Kiadis (sold to Sanofi), and Conversocial (sold). Stuart serves as a director with Netronome, Aircall, Resolver, Realeyes and Riverlane; and as observer with Graphcore and Crate. Before 3i, Stuart was involved in software and systems implementations for Midland Bank. He is a graduate of Loughborough University and currently serves on the Strategic Advisory Board for the Loughborough School of Business.
Benjamin Wilkinson (Chief Financial Officer)
Ben was appointed to the Board on 4 June 2019, having joined the Group as CFO in 2016. In addition to his responsibilities for the Group’s finance and investor relations functions, Ben serves as a member of the Investment Committee. Ben has led on recent equity and debt raises totalling over £500.0 million. Ben is an experienced leader of public company finance teams having previously served for 5 years as CFO of AIM-listed President Energy PLC where he was responsible for all financial aspects of the group. During his time at President, Ben was a key part of the Board that undertook investments into Argentina and Paraguay and raised US$175 million across several equity issuances with shareholders such as IFC/World Bank and significant UK institutional investors. Ben is a Chartered Accountant, FCA, with a background in M&A investment banking from ABN Amro/RBS where he was involved with multiple cross border transactions and corporate financings, both debt and equity. Ben is a graduate of Royal Holloway, University of London with a BSc in Economics.
Grahame Cook (Senior Independent Non-Executive Director)
Grahame Cook is the Senior independent Non-Executive Director for Molten Ventures and chair of the Audit, Risk and Valuations Committee. Grahame is an experienced public company non-executive director, with over 20 years’ experience as an audit and risk committee chairman. Grahame’s background is in investment banking, with 20 years’ experience of M&A, equity capital markets and corporate advisory. Grahame started his career at Arthur Andersen, where he qualified as a chartered accountant. He became a Director of Corporate Finance at Barclays de Zoete Wedd in 1993, and then joined UBS as a Managing Director, member of its global investment banking management committee and global head of equity advisory. At UBS he was responsible for creating its industry sector teams, including tech and healthcare. In 2003 he became joint chief executive officer at WestLB Panmure where he built a pan-European business focussed on growth companies and ran a €100m technology fund. He advised the London Stock Exchange in 2003 on the creation of its TechMark growth segment. Grahame sits on a number of technology and technology rich healthcare company boards, both listed and unlisted. Grahame holds a Double First Class Honours degree from the University of Oxford.
Richard Pelly (Independent Non-Executive Director)
Richard is a Non-Executive Director on the board of Molten Ventures and an advisor in the area of micro, small and medium-sized businesses. Up until April 2014, Richard was the chief executive of the European Investment Fund (‘‘EIF’’), Europe’s largest investor in venture capital funds. Before joining EIF in April 2008, Richard was managing director of structured asset finance at Lloyds TSB Bank in London from 2005 to 2007. From 1998 to 2005, he worked for GE Capital, first as chairman and CEO of Budapest Bank in Hungary and then as CEO of UK Business Finance within GE Commercial Finance. Prior to his career at GE, Richard worked for Barclays Bank in various functions in the UK and in France from 1977 to 1997. Richard holds an honours degree in Psychology from Durham University and an MBA with distinction from INSEAD Fontainebleau. In 2003, he was awarded an OBE in the Queen’s Honours List for Services to the Community in Hungary.
Gervaise Slowey (Independent Non-Executive Director)
Gervaise Slowey is a Non-Executive Director on the board of Molten Ventures with a background in senior management, international business, marketing and media. Gervaise serves as a non-executive director on the boards of Dalata Hotel Group plc, Wells Fargo Bank International (WFBI), Eason PLC (Ireland’s largest book retailer) and the Institute of Directors in Ireland. She also chairs the Remuneration and Nomination Committee for WFBI. Gervaise was CEO of Communicorp Group (now Bauer), Ireland’s largest independent radio group for four years to the end of 2016, and also served as a non-executive director on the board Ulster Bank Ireland for three and a half years to October 2021. Prior to that she held senior roles in Ogilvy Worldwide for 16 years, most recently Global Client Director. Gervaise has also served on the boards of the International Rice Research Institute, a global organisation dedicated to abolishing poverty and hunger among those dependent on rice, and the Institute for International and European Affairs (IIEA). Gervaise is a Chartered Company Director (Institute of Directors), a Certified Bank Director (Institute of Bankers), and a Dublin City University Business Studies graduate (BBS). She is particularly interested in sustainability and recently completed the Sustainability Leadership Program at Cambridge University.
Sarah Gentleman (Independent Non-Executive Director)
Sarah is an independent Non-Executive Director on the board of Molten Ventures and chair of the Company’s Remuneration Committee. Sarah also chairs the Remuneration Committee at Rathbone Brothers as well as being a member of Rathbones Brothers’ Audit, Risk & Nomination Committees . Sarah has over 30 years' experience working in a combination of strategic and financial roles, having started her career as an analyst at McKinsey & Company. These include Business Development Director at Egg UK and Chief Financial Officer at LCR Telecom. Until 2012, she was a sell side banking analyst at Sanford Bernstein where she covered French, Spanish and Italian banks. Most recently, Sarah has been working as an advisor to early-stage technology companies with a focus on FinTech.
5. Director Roles and Responsibilities
Karen Slatford, as chair of the Board, is responsible for leading an effective Board, upholding high standards of corporate governance throughout the Group, particularly at Board level, and ensuring appropriate strategic focus and direction. Karen is also chair of the Nomination Committee.
Martin Davis is the Chief Executive Officer and has overall responsibility for proposing the strategic focus to the Board, delivery of the business model & strategy and the day-to-day management of the Group's business.
Grahame Cook is an independent Non-Executive Director and is the chair of the Audit, Risk and Valuations Committee. Grahame is also a member of the Remuneration Committee and Nomination Committee as well as being the Senior Independent Director on the Board. As Senior Independent Non-Executive Director, Grahame provides a sounding board for the chair of the Board and serves as an intermediary for the other Directors and the Shareholders, and has a prime role in succession planning for the chair of the Board.
Sarah Gentleman is an independent Non-Executive Director and chair of the Remuneration Committee as well as a member of the Audit, Risk and Valuations Committee and Nomination Committee.
Richard Pelly is an independent Non-Executive Director and a member of the Audit, Risk and Valuations Committee, Remuneration Committee and Nomination Committee.
Gervaise Slowey is an independent Non-Executive Director and is a member of the Audit, Risk and Valuations Committee, Remuneration Committee and Nomination Committee.
Stuart Chapman is the Chief Portfolio Officer and ensures that the Board is properly briefed on the operating performance of the business, including in respect of the investment portfolio. Stuart is supported in respect of HR matters, risk and compliance by the HR Manager, Compliance Team and legal department respectively.
Ben Wilkinson is the Chief Financial Officer and is responsible for the Group's finance and investor relations functions.
The Board is responsible to Shareholders for the overall management and oversight of the Group to ensure its long-term success. In particular, the Board is responsible for approving the Group's strategy (and for ensuring that the Group has the necessary people, resources and infrastructure to deliver the strategy), setting the Group's risk appetite, monitoring performance, and maintaining an effective system of risk management and internal controls. It is also responsible for the Group's approach to environmental and social governance. The Non-Executive Directors are responsible for providing constructive challenge, strategic guidance and holding management to account. The Non-Executive Directors are available to engage with Shareholders should they have a concern that is not resolved through the normal channels.
The Board has a Diversity & Inclusion Policy which sets out the crucial role that diversity and inclusion plays in the leadership of the Company, and the targets that the Company is committed to meeting in the coming years. A copy of the Board Diversity & Inclusion Policy can be found HERE.
6. Matters reserved for the Board
The Schedule of Matters Reserved for the Board of the Company sets down those powers reserved to the Board and which are not delegated to the Company's Executive Directors. The list contains some matters which the Board cannot, as a matter of law, delegate. In accordance with the Company’s articles of association the Board may, however, appoint committees as it thinks fit to exercise certain of its powers.
A copy of the Schedule of Matters Reserved for the Board of Directors can be found HERE.
The Board has established an Audit, Risk and Valuations Committee; a Remuneration Committee; and a Nominations Committee, with formally delegated duties and responsibilities as described below.
Audit, Risk and Valuations Committee
The Audit, Risk and Valuations Committee is responsible for ensuring that the financial performance of the Group is properly reported on and monitored. Its role includes monitoring the integrity of the Group’s financial statements, reviewing significant financial reporting issues, reviewing the effectiveness of the Company’s internal control and risk management systems and overseeing the relationship with the external auditors (including advising on their appointment, agreeing the scope of the audit and reviewing the audit findings). The committee is also responsible for reviewing the Company’s valuation policies and procedures to ensure that the Board is fulfilling its obligations relating to the independent and proper valuation of the underlying Group investments, and for establishing, monitoring and reviewing procedures and controls to ensure compliance with the relevant regulatory regimes. The Audit, Risk and Valuations Committee will normally meet not less than three times a year.
Grahame Cook chairs the Committee and its other members comprise Richard Pelly, Gervaise Slowey and Sarah Gentleman. The UK Corporate Governance Code recommends that all members of the Audit, Risk and Valuations Committee be Non-Executive Directors, independent in character and judgment and free from any relationship or circumstance which may, could or would be likely to, or appear to, affect their judgment and that one such member has recent and relevant financial experience. The Board considers that the Company complies with the requirements of the UK Corporate Governance Code in this respect.
A copy of the Terms of Reference of the Audit, Risk and Valuations Committee can be found HERE.
The Remuneration Committee recommends the Group’s policy on executive remuneration; determines the levels of remuneration for the Company’s executive directors and the Chairperson and other senior executives; prepares an annual remuneration report for approval by the Shareholders at the annual general meeting; and assists the Board in reviewing the structure, size and composition of the Board. The Remuneration Committee will normally meet at least twice a year.
Sarah Gentleman chairs the Remuneration Committee and its other members comprise Grahame Cook, Gervaise Slowey and Richard Pelly. The UK Corporate Governance Code recommends that all members of the Remuneration Committee be Non-Executive Directors, independent in character and judgment and free from any relationship or circumstance which may, could or would be likely to, or appear to, affect their judgment. The Board considers that the Company complies with the requirements of the UK Corporate Governance Code in this respect.
A copy of the Terms of Reference of the Remuneration Committee can be found HERE.
The Nominations Committee is responsible for reviewing succession plans for the Directors, including the Chairperson and the Chief Executive Officer and other senior executives. The Nominations Committee will normally meet at least twice a year.
Karen Slatford chairs the Nominations Committee and its other members comprise Grahame Cook, Richard Pelly, Gervaise Slowey and Sarah Gentleman. The UK Corporate Governance Code recommends that all members of the Nominations Committee be Non-Executive Directors, independent in character and judgment and free from any relationship or circumstance which may, could or would be likely to, or appear to, affect their judgment. The Board considers that the Company complies with the requirements of the UK Corporate Governance Code in this respect.
A copy of the Terms of Reference of the Nominations Committee can be found HERE.
8. Board evaluation
In line with the Board's Evaluation Policy, the Board conducts formal performance evaluations of each director and the full Board every year. The process is carried out by way of detailed questionnaires completed by each member of the Board and covering topics such as the composition of the Board, the quality and timeliness of information provided, relationships between the Board, Shareholders, employees and other stakeholders, and succession planning. The responses are collated by the Company Secretary, who presents a summary of the results to the Board for discussion.
The Board will typically agree a number of specific actions to take forward during the forthcoming year in order to improve its efficiency and effectiveness.
9. Committee evaluation
Committee evaluation is also conducted by way of questionnaires, with the questions asked including the extent to which the Board's Committees are properly constituted and received appropriate information in order to discharge their duties, whether each of the Committees had performed their role and responsibilities, as detailed in their Terms of Reference and the reporting of the Committee activities to the Board.
10. City Code on Takeovers and Mergers – Mandatory Bid
The City Code on Takeovers and Mergers (the “Takeover Code”) applies to the Company. Under Rule 9 of the Takeover Code, if a person acquires an interest in Ordinary Shares which, when taken together with Ordinary Shares already held by them or persons acting in concert with them, carry 30 per cent. or more of the voting rights in the Company; or a person who, together with persons acting in concert with them, is interested in not less than 30 per cent. and not more than 50 per cent. of the voting rights in the Company acquires additional interests in Ordinary Shares which increase the percentage of Ordinary Shares carrying voting rights in which that person is interested, the acquirer and, depending on the circumstances, its concert parties, would be required (except with the consent of the Takeover Panel) to make a cash offer for the outstanding Ordinary Shares at a price not less than the highest price paid for any interests in the Ordinary Shares by the acquirer or its concert parties during the previous twelve months.
Please contact our Investor Relations team at IR@molten.vc if you require more information about the application of the Takeover Code to Molten Ventures.
11. Major Shareholding Notifications
A summary of Major Shareholding Notification requirements under the UK FCA’s Disclosure Guidance and Transparency Rules; the Irish Transparency (Directive 2004/109/EC) Regulations 2007, as amended, and the Central Bank (Investment Market Conduct) Rules 2019 can be found HERE.
12. Investment Objective and Investing Policy
The investment objective of the Group is to generate capital growth for Shareholders by the creation, funding, incubation and development of high-growth technology businesses.
The Group intends to meet its investment objective by: (i) providing early stage businesses with initial smaller rounds of seed and series A primary investments, co-investments and commitments to third party seed funds; (ii) making larger series B+ and later series C+ primary investments and co-investments for scaling technology companies; and (iii) undertaking secondary transactions.
The Group will seek exposure to early stage companies which combine technology and service provision, are able to generate strong margins through significant intellectual property or strong barriers to entry, are scalable and require relatively modest investment. The Group will primarily seek exposure to developing companies in, but not limited to, the following sectors of the digital economy: consumer technology, enterprise technology, hardware and deeptech and digital health and wellness.
The Group’s main focus is on making investments in the UK and Europe.
No investment will be made if its costs exceed 15% of the Gross Portfolio Value at the time of investment. A further investment may be made in an existing portfolio business provided the aggregate cost of that investment and of all other unrealised investments in that portfolio business does not exceed 15% of the Gross Portfolio Value.
Esprit Capital Partners LLP, Encore Venture LLP and Elderstreet Investments Ltd (all of which are FCA-regulated Alternative Investment Fund Managers and wholly owned subsidiaries of the Company) respectively manage the historic Esprit Funds, Encore Funds and Molten Ventures VCT plc (formerly Draper Esprit VCT plc) in accordance with each of their respective investment objective and policy. The investment objective and policy applicable to the Encore Funds, Molten Ventures VCT plc and the historic legacy managed Esprit Funds, is distinct from the investment objective and investment policy of the Group.
13. Environmental, Social, and Governance
The Group is committed to a policy of responsible investment that includes due consideration of Environmental, Social and Governance (ESG) factors through the lifecycle of investments, from pre-screening to exit in alignment with the UN Sustainable Development Goals (UN SDGs) and the UN Principles for Responsible Investment (PRI) (to which Molten Ventures became a signatory in 2019). We aim to use our platform in venture capital to encourage and promote our values and ESG considerations in developing best-in class technology companies and achieving strong returns for our investors. A portion of the bonus entitlement of all employees, including the executive directors, is directly linked to ESG risks and performance through the attainment of ESG-specific KPI's, a summary of which are included in the Molten Ventures Annual Report.
14. Form of investment
Investments are expected to be mainly in the form of equity, although investments may be by way of debt, convertible securities or investments in specific projects. In the case of equity investments, Molten Ventures typically takes positions (with suitable minority protection rights where appropriate) in unquoted companies. Molten Ventures (acting through relevant Group entity/entities) is an active investor, often taking a board position on the investee company.
Given the time frame to fully maximise the value of an investment, the Board expects that investments will be held for the medium to long term, although short term disposals of assets are also considered where the return on investment is commercially and/or circumstantially compelling and in line with the Group’s investment strategy. The Directors intend to re-invest the proceeds of disposals in accordance with the Group’s investing policy unless, at the relevant time, the Directors believe that there are no suitable investment opportunities, in which case the Directors will consider returning the proceeds to Shareholders in a tax-efficient manner.
15. Notice to U.S. persons
The ordinary shares of Molten Ventures ("Ordinary Shares") have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States and the Ordinary Shares may not be offered, sold, exercised, resold, transferred or delivered, directly or indirectly, within the United States or to, or for the account or beneﬁt of, U.S. Persons (as deﬁned in Regulation S under the U.S. Securities Act), except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction in the United States. There will be no public offer of the Ordinary Shares in the United States. Any offer or sale of Ordinary Shares will be outside the United States to non-U.S. Persons in offshore transactions in reliance on the exemption from the registration requirements of the U.S. Securities Act provided by Regulation S thereunder. The Company has not been and will not be registered under the U.S. Investment Company Act of 1940, as amended (the "U.S. Investment Company Act") and investors will not be entitled to the beneﬁts of the U.S. Investment Company Act.
The Company and certain of its subsidiaries and subsidiary undertakings may be passive foreign investment companies ("PFIC") for U.S. federal income tax purposes, and they could each be a PFIC in future years and, if the Company and/or certain of its subsidiaries and subsidiary undertakings are PFIC, U.S. taxable investors may be subject to adverse U.S. tax consequences in respect of an investment in Ordinary Shares by a U.S. Person.
The Ordinary Shares have not been approved or disapproved by the U.S. Securities and Exchange Commission, any state securities commission in the United States or any other U.S. regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of any offering of Ordinary Shares. Any representation to the contrary is a criminal offence in the United States and any re-offer or resale of any of the Ordinary Shares in the United States or to U.S. Persons may constitute a violation of U.S. law or regulation.
On 28 May 2019, the Board approved a credit agreement for a £50.0 million facility with Silicon Valley Bank and Investec to fund the future growth plans of portfolio companies. The term was subsequently extended to 2024 and increased in size by £15.0 million to £65.0 million in line with the Company’s growing portfolio.
The Company may use gearing if it believes it will enhance Shareholder returns over the longer term. The Company seeks to maintain a conservative level of gearing and will limit its borrowings to a maximum of 25% of Net Asset Value at the time of investment.
Cash held by the Group pending investment, reinvestment or distribution will be managed by the Group in accordance with the Group’s treasury policy and placed in bank deposits with major global financial institutions, in order to protect the capital value of the Group’s cash assets. Investments are expected to be held by the Company or a subsidiary to be incorporated for the purpose of holding an investment
18. Regulatory News
Gareth Faith, Molten Ventures plc, 20 Garrick Street, London, WC2E 9BT, United Kingdom
Joint Financial Adviser and Corporate Broker
Numis Securities Limited, 10 Paternoster Square, London, EC4M 7LT, United Kingdom
Joint Financial Adviser and Corporate Broker, Euronext Dublin Sponsor
Goodbody Stockbrokers UC, Ballsbridge Park, Ballsbridge, Dublin 4, Ireland
Legal Advisers to the Company (as to English law)
Gowling WLG (UK) LLP, 4 More London, Riverside, London, SE1 2AU, United Kingdom
Legal Advisers to the Company (as to Irish law)
Maples and Calder (Ireland) LLP, 75 St. Stephen’s Green, Dublin 2, Ireland
Reporting Accountants and Auditors
PricewaterhouseCoopers LLP, 7 More London, Riverside, London, SE1 2RT, United Kingdom
Equiniti Limited Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, United Kingdom
Financial Public Relations
Powerscourt Limited, 1 Tudor Street, London, EC4Y 0AH, United Kingdom
“Company” – Molten Ventures plc
“Directors” or “Board” - the Directors of Molten Ventures from time to time
“Executive Director” - an executive director of Molten Ventures from time to time
“Group” – the Company and all of its subsidiaries and subsidiary undertakings from time to time
“Non-Executive Director” - a non-executive director of Molten Ventures from time to time
“Shareholders” - the shareholders of Molten Ventures