News letter - armilar.com...Domatica Global Solutions is an Espírito Santo Ventures III portfolio company, that offers the most flexible and agile platform in the market for the remote

1st Quarter 2014

Rua Alexandre Herculano, 38 • 1269-161 Lisboa - Portugal • Phone: +351 21 310 64 90 / Fax: +351 21 310 64 25 • E-mail: [email protected]

www.es-ventures.com

NewsletterCleantech Healthcare IT

Editorial

Joaquim Sérvulo RodriguesCEOEspírito Santo Ventures

Nevertheless the evolution that occurred in

the past few years is impressive.

The change inside the best technology

schools accelerated with a more open-to-

the-market spirit, the creation of formal

Technology Transfer Offices and the

development of an entrepreneurial mindset,

in particular within the student communities,

but also among teachers and researchers.

The enormous increase in the number of

Business Angels, as well as in the amount

they have available for investment, thus

increasing the number of start-up companies

invested by them.

Foreign entrepreneurs are beginning to chose

Portugal as the place to start their new

businesses, probably taking into account both

the high living standards that exist here, the

relative low cost of tech experts, and

The relation between innovation and wealth creation is nowadays very well established.

For a region to have a good level of wealth

it has to fall in one of two categories. If the

region is lucky enough to have some valuable

natural resource (such as oil in its subsoil),

it only needs to explore it. Alternatively, it

has to produce something different or much

better than others do, for the market to be

willing to pay a premium for those products

or services. Typically the latter regions export

value-added products and services.

For many regions (like Portugal) only the

second option is available.

Innovative ecosystems facilitate

tremendously the blossoming of companies

that create differentiated products or

services. Rich innovative ecosystems

are composed of a number of different

participants. They encompass good

technological learning centres, R&D

institutions, Business Angels, Serial

entrepreneurs, Venture Capitalists, R&D

centres from multinational tech companies,

internationally minded and experienced

managers, access to financial markets, to

name just a few.

The innovative ecosystem in Portugal is still

in its infancy.Continued on page 8

02 Espírito Santo Ventures - Newsletter - 1st Quarter 2014

1st Quarter 2014 - Newsletter - Espírito Santo Ventures 03

Domatica Global Solutions is an Espírito Santo Ventures III portfolio company, that offers the most flexible and agile platform in the market for the remote monitoring and control of any type of sensor or electrical equipment, with a broad range of applications.

So, in 2002, I decided that the best way to

achieve this goal was to set up a company

with my own funds. With my own company I

had the opportunity to research and develop

the framework, while engaging with projects

with which I could learn about and improve

on the technology and, at the same time,

fund its development. In 2003, I launched

the first version of the framework – at that

time, it remained experimental. It then took

another six years of development before I

was able to launch the second version of the

framework, which was ready to launch on the

global market. Of course, these were years

during which venture capital was still not very

accessible, especially for the development

stages of a technology. Since 2009, there have

been a number of key developments, with

large pilot projects running in different areas

of business, and in 2011 I felt we were in a good

position to make an impact globally. At this

stage, ESV decided to support us and invested

in Domatica. This was a key turning point in

terms of the expansion of the company, and

has enabled us to reach the position we are

now in.

Samuel SilvaCEO of Domatica

We invited Samuel Silva, founder

and CEO of Domatica, to discuss the

company’s technology and positioning.

ES Ventures - Samuel, could you start by

describing the origins of Domatica?

Samuel Silva - When I was studying

electronics at University, I realized that the

world of monitoring and control was full

of barriers. Engineers from electronics and

computing inhabited isolated islands. If, for

instance, I wanted to develop a software

program to control a physical device, this

would be a major challenge.

This resulted in a growing interest to develop combined electronics and computing strategies to connect the physical and the software worlds, and a window of opportunity for innovative solutions led to the inception of Domatica.


ESV - And then this evolved into the flexible

technology that you have today. Could you

please describe the technology, and what it

does, to our readers?

SS - Our framework has a key feature that

makes it unique: the ability to narrow the

distance between the physical and the

software worlds. But what does this mean in

practice? Quite simply, it means we are able to

set and categorize our physical devices, each

with different features, in a logical manner.

The software layer has all the capacity to

monitor and control these devices in real time,

without having to handle the specificities

of each device. It is now possible to have

dozens of sensors that, for example, measure

temperature, CO2, humidity or energy, and

whose different signals at the software level

are provided in real-time with read-outs in

degrees, ppm, percentage or kWh.

ESV - One of the characteristics of your

framework, the iDomFrameworkTM, is that it

serves a multitude of different applications.

Can you cite some specific examples?

SS – Absolutely. There are a wealth

of possibilities for the application of

iDomFrameworkTM. It can be applied in any

situation in which real-time monitoring and

control of physical devices is required. We

have developed applications based on our

technology for production control systems

in agriculture and livestock, building and

energy management systems, and industrial

processes management and cost control

systems. With the latter, it is now possible

to have, at each step of a production cycle,

the exact associated cost, with all the data

automatically inserted into the client’s own

production cost control system.

ESV - What impact does the technology

have on your clients’ business?

SS - Our technology provides real-time

valuable information that allows any process

or particular step and/or location to be

optimised. For instance, imagine that you have

more than a thousand sites, in any field from

restaurants to bank branches, and that you

want to implement policies aimed at reducing

energy consumption and costs drastically, for

example, by altering key set points. With our

technology, this can be done with a simple click

at a central location, and all those changes

will be implemented in a uniform manner in all

sites.

Livestock animal production is another area where there was a tremendous impact. We are able to provide information in real time about all the conditions and parameters to which the animals are subjected, and provide alerts to the producer if something fails.

For example, one can easily know if the

animals were comfortable during the night by

checking if the temperature was, in fact, at its

set value the whole time. Or one could set an

alert if temperature drops or rises below or

above a certain value, enabling the producer

to take immediate remedial action. This

level of monitoring of conditions has major

implications in the levels of stress, comfort

and health of the animals. Furthermore, our

technology enables the optimal settings of

many values, that are key for optimal animal

comfort and production, to be determined

and maintained. These ideal settings can then

immediately be applied to all the pavilions

with a simple click. Our technology has

dramatically impacted the way pig and poultry

producers plan and manage their livestock

production. Health of animals, costs and time

of production, and mortality of newborns were

all impacted by real time information.


CASE STUDYWe designed and implemented our technology at Agrupalto Group livestock farms. The

results are summarized below, and provide a good demonstration of the power of the

technology and of knowing the parameters being measured in real-time:

AniMAl WElFARE 51 % mortality reduction

Stabilisation of a comfortable temperature

Homogeneous environmental quality

EnERgY 50% reduction in heating systems in the maternity units

44% reduction in heating and ventilation systems in piglet units

FEEDing Reduction of waiting time for the silos stock replacement

Feeding system works on a predefined schedule

WATER Reduction of water pumps working time

STAFF Knowledge of real working hours

Monitoring compliance of tasks

Overall improvement of task execution

The chief veterinarian officer at Agrupalto, Rui Luís Sales, said that “the adoption of the

FarmControl™ solution yielded major benefits for the whole production process”, and that

helped him to have a “clearer understanding of the every-day operation of the livestock

farm, enabling an efficient decision-making process on matters such as type of equipment,

structures, facilities, and even personnel management. The first benefit is the awareness

of how energy is used in the initial phase and consequently rationalizing its use. This not

only leads to significant energy and costs savings, but also to large improvements in animal

welfare and health, which in turn leads to enhanced productivity”.

PHASE 1: No Rules set in FarmControl.State: Heating turned on with

energy consumption at 100 % and average room temperature near 39 °C.

Analysis: There is no homogeneous temperature or stabilized comfort value. The energy consumption is constant at the maximum value.

PHASE 2: Creation of a FarmControl Rule to manage/control the temperature values around 34° C.State: Average temperature

of the room constantly in the 34 °C and average energy consumption in 50 % of maximum.

Analysis: There is stabilization of the temperature to the indicated value (34 °C ) and an immediate drop in energy consumption.

PHASE 3: Amendment of FarmControl Rule for management/control of the temperature values around 32 °C.State: Average temperature

in the room constantly in 32 °C and average energy consumption 30 % of maximum.

Analysis: There is stabilization of the temperature to the indicated value (32 °C) and an immediate drop in energy consumption.

Chart Analysis of applying Temperature/Heating Rules

Phase 1

5 kWh 50 ºC

4 kWh 40 ºC

3 kWh 30 ºC

2 kWh 20 ºC

1 kWh 10 ºC

Phase 2 Phase 3

Rule change

0 kWh 0 ºC16 10. Nov 11. Nov08 16 12. Nov08

Temperature

Temperatura / Aquecimento

Heating (Energy)

16 08 16

Rule created

We are also actively working on industrial

processes, and we are currently working with

clients in the packaging and car manufacturing

sectors. It is now possible to know the exact

cost of each step of a car’s manufacture, or

even identify tiny parts of the car that were

initially thought to be cheap, but turn out to be

quite expensive.

The knowledge of the contribution of each production step to the total production cost enables the whole process to be optimized, along side with a considerable reduction in overall costs.

ESV - This diversity of applications also

creates a challenge. How do you go about

marketing your technology to such a broad

market?

SS - There are very many applications for

which the iDomFrameworkTM can be a major

asset. We develop a number of projects

ourselves, and in other cases we work together

with leading software partners who are also

major players in specific business areas. We

see our technology as an enabling tool, and our

vision is that real time knowledge and control

can dramatically influence the way we manage

different processes.

ESV - To wrap it up, we often end with this

question: what is your vision for Domatica,

say, in five years?

SS – As a growing company our wish is to

spread our technology globally; that processes

are equipped with our technology, and that it

becomes a standard tool in any process that

can benefit from real-time monitoring and

control of physical devices. I strongly believe

that in a world with increasing demands

for resources such as energy and food, our

technology can have a huge impact by making

the processes involved more efficient.


In hindsight, this major change was likely due

to three key aspects:

Saturation: the number of researchers with

doctoral degrees that would proceed their

careers in academia throughout their lives

decreased significantly as the number of

vacancies across the Portuguese Universities

filled up to the point of saturation (much more

“demand” than “supply”)

Benchmarking-inspired trend: an increasing

number of doctoral and post-doctoral

Portuguese students had the opportunity

to graduate in top international schools,

where they were exposed to the dynamics of

researchers creating their own start-ups and

explore the market value of their own research

Budget restrictions: in the recent years,

budgets from Universities and Research

Labs have been under pressure, limiting

their capability to retain the best talents

and fostering these young and high-qualified

graduates to look for professional alternatives

in the market

If one looked at the major Portuguese

Universities just ten years ago, one

would find most institutions would be mainly

focused in the education of future highly

qualified professionals that would typically

be hired by large and medium established

enterprises and industries. One would also find

that professors, in addition to their teaching

activity, would likely be dedicated to research

and producing high quality science papers,

internationally recognized by well-known

peers.

At that time, the existing infrastructure

among Universities would mainly support

both the activities of teaching and research.

The research was conducted in University

laboratories, but mainly in “Associated

Laboratories” - independent bodies with which

Universities had agreements to work together

which were funded directly by the FCT1. The

priority in research by then was driven by the

quantity – and quality of publishing research

results. More often than not, knowledge

coming out of that research would be made

public even before any attempt to protect it, a

common practice across all areas of R&D.

As a result, the number of technology-based

companies coming out of the University

ecosystems was considerably limited; to some

extent spin-outs were seen as the “exceptions”

within the university culture at that time.

Some of those spin-outs would yet become

very well-known successful stories, as the case

of Novabase2 or Chipidea3, or other even lesser

known but equally successful companies such

as Siscog4.

Today, the major Portuguese Universities have

been able to change that paradigm profoundly.

The creation of companies that exploit, in the

market, the knowledge generated within the

University is highly valued, and in that regard,

much of the existing infrastructure is now a lot

more focused on that aspect.

The technology-based entrepreneurship has in itself the potential

to create disruptive value. During the last decade, in Portugal,

a dramatic change has occurred regarding how the major

Universities have been dealing with their own generation of

scientific knowledge, reinforcing their role as the key pillar of this

technology-based entrepreneurship.

The new potential coming out of Portuguese Universities

José guerreiro de SousaPrincipal at Espírito Santo Ventures

1 FCT – Fundação para a Ciência e Tecnologia - is the Portuguese national funding agency for science, research and technology

2 http://en.wikipedia.org/wiki/Novabase

3 http://en.wikipedia.org/wiki/Chipidea

4 http://en.wikipedia.org/wiki/Siscog


Aquaspy partners with Valley irrigation, to offer farmers the most

advanced soil moisture monitoring solution.

Valley SoilPro™ 1200, AquaSpy’s flagship

solution, will provide real-time data that tells

growers how much water is needed at each

stage of a crop’s growth cycle. Sold in an

annual subscription format, Valley SoilPro™

will leverage on its Aquaspy partner’s brand,

reputation and competent dealer network.

Heartgenetics won Foundation Everis Entrepreneurship Award,

for its innovative method of genetic diagnosis

to support clinical decisions, enabling doctors

and medical professionals to make a more

precise diagnosis in less time and stratify the

risk. This is an highly competitive contest with

participants from more than 5 countries, in a

total of 272 applications.

JDCPhosphate raised an additional $8 million to advance and expand its

development and commercialization activities.

The company has raised a total of $39 million

to fund the development, construction

and operation of its 12.000 ton per year

demonstration plant in Fort Meade, Florida,

and to begin the process of commercializing its

technology. The process technology developed

by JDCP produces high purity phosphoric acid

using low-grade phosphate rock, without the

production of solid or liquid waste.

Recent news

PAYPAY

Today, there is clearly a greater care in the

selection of the knowledge that, in addition

to the scientific value, has the potential to

later create economic value. And there is also

a growing concern to protect this intellectual

property before it becomes public. In the

past, only a few class of patents were valued,

particularly those hat would be licensed to

the incumbent industry; today, a new class of

patents is equally valued, namely those that

support the basis for the creation of start-

ups that hopefully, with the right financing

and support, can succeed in solving some of

the society’s problems in a disruptive manner

and revolutionize specific sectors of activity.

Moreover, business creation begins to be

faced and promoted as a life-time project for

undergrad and graduate students.

The role of the Technology Transfer Office

(TTO), for Universities that have traditionally

dealt almost exclusively with patenting, patent

licensing and contract with industry, has also

begun to include the important functions

of stimulating the entrepreneurial spirit in

the school community, screening of projects

with higher potential value, and supporting

the entrepreneurs in the structuring of their

business plans or even the approach to the

venture capital community.

Major Universities have gone further,

establishing relationships and promoting the

creation of incubators and technology parks,

in which these young companies find the

adequate environment to develop themselves,

within the university ecosystem, whilst

preparing the basis for their independence.

On the other hand, the successful

entrepreneurs of the first generation of

technology-based companies are now

available and interested in helping out these

young companies and entrepreneurs, lending

to them their experience, their knowledge

and their contacts, and reducing the risk of

succumbing to the daily adversities that the

companies are constantly exposed to.

Today, major Universities are connected

to the surrounding environment in such

a manner, either through their TTO and

relations with research centres, business

incubators, technology parks, business angels

and investors, that one would find it more

appropriate to talk in terms of “ecosystems

centered around the Universities”.

As for Espírito Santo Ventures, over the

past three years, we had access to over

1100 investment opportunities originated in

Portugal. Of those, about a quarter originated

in these large ecosystems and many were

evaluated in greater detail. In the end, 7

were invested by the fund ISTART I, a fund

specifically created to invest in tech-based

companies founded by professors, researchers

or students from Portuguese Universities.

In these investment processes, we find a

recent trend for Universities to exchange the

model of licensing IP to start-ups, for a share

in their capital, becoming stakeholders in

the success of the company, not just patent

merchants - which is an extremely positive

attitude.

Looking at the future, we believe the

Universities are moving even further upstream

in the identification of knowledge that may

generate economic potential, conducting

early-scouting on research, but that is still

in an embryonic stage. Besides identifying

ongoing work that could become a source

of economic value, these initiatives create

awareness about the potential economic

value of scientific work right in its source -

laboratories and research centres – where

typically some of these concepts had never

been considered before.

Most likely, in the next 10 years, the role of

Universities in the creation of economic value

through spin-out companies will be side by

side with their current roles in teaching and

conducting research.


the emergence of high quality incubators like,

for instance, the IPN – Instituto Pedro Nunes

and Startup Lisboa.

The fact that top international incubators (e.g.

Seedcamp) are now coming to Portugal on a

regular basis to attract high potential startups

into their ranks, or that key startup events (eg,

Europe-Unlimited, Young Innovators) are now

including Lisbon in their roadmap, is also a

clear sign of the increase in the maturity of the

innovative ecosystem in this country.

Petra Solar becomes Petra Systems, and expands the strategic

focus beyond solar generation. Leveraging

the expertise developed over the past eight

years as the core technology supplier to the

world’s largest mesh networked distributed

power plants, Petra Systems will also deliver

intelligent, efficient, and remotely managed

energy networks for smart city applications to

be deployed by municipalities, transportation

authorities and utilities, under the brand Petra

Smart City Solution

All of these factors are reinforcing each other

and contributing to strengthen the wealth

creation machine that the country needs.

Naturally, a significant number of the startups

being created will not make it but, from the

critical mass that is forming, it is very likely

that some impressive companies are being

started right now.

Codacy opens for business, after a

two-month period of beta trials with 1.300

developers. Codacy’s automated code review

tool is now commercially available, with prices

that target individual developers, teams

and larger companies by providing different

collaboration levels and code analysis capacity.

nutri Ventures teams up with partnership for a Healthier America, a nonprofit organization chaired

by First Lady Michelle Obama, with the core

mission of promoting healthy eating habits

in children. During the Healthier Future

conference, where the partnership was

announced, Michelle Obama publicly thanked

Nutri Ventures, remarking Nutri Venture’s

commitment to improve childhood nutrition.

All 29 episodes of “Nutri Ventures: The Quest

for the 7 kingdoms”, along with music videos

and other digital features will be made

available for free to nearly 60.000 public

elementary schools for educational use

beginning in September.

Ubiquity announced a $4M series B financing from existing investors. The

capital will be used to expand Ubiquity’s global

footprint, to make additional investments in

the development of its proprietary technology

and to scale operations to keep pace with the

exceptional growth and customer demand the

company has experienced since its founding

in 2012.

Recent news

EditorialContinued from page 1

PAYPAY

PAYPAY

Outsystems opens an office in Singapore, to serve Southeast Asia,

Australia and Japan. The strong economic

growth and maturity of the Asian market has

led companies to consider the implementation

of innovative business processes and

differentiators using web and mobile

technologies, and this has been driving the

success of Outsystems’s platform in these

territories, up to a point where it became

imperative to create a business center. The

company already has operations in the United

States, Portugal, United Kingdom, and The

Netherlands with master resellers in Brazil and

South Africa. With the opening of this office,

Outsystems expects to improve its distribution

and customer support worldwide, especially in

the APAC region.

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News letter - armilar.com...Domatica Global Solutions is an Espírito Santo Ventures III portfolio company, that offers the most flexible and agile platform in the market for the remote