MDB was founded in 1997, originally operating as MDB Capital Group, LLC, for the
purpose of engaging with companies holding visionary technology, inventors, and
technology entrepreneurs. To maximize the impact of our actions and culture,
under our business plan, we embark on each journey with a company at an early
point, typically acting as founders and providing the initial rounds of capital,
in the manner of a partner and usually before a specified management structure
has been put in place. Part of our role as founders often includes locating the
technology that will form the basis of the new enterprise. The technologies may
be found in universities, in larger companies where it is not being used or
understood, in start-up companies, and with inventors. Not only do we act as
founders and providing the first capital rounds, we assist with structuring the
plans for the company development, such as the steps from research and
development to initial commercialization, the intellectual property strategy,
business objectives, and financing. We refer to these subsidiary companies as
“partner companies.”
Our model typically includes a two-step financing approach with our partner
companies: we put in seed capital, as founders, and the first round of capital
of between $5 to $10 million dollars to set the business on an operational
foundation. Our plan is to then raise an additional amount of substantive
capital to bring the technology closer to validation or to be able to commence
commercialization, typically in the range of $20 to $60 million and often via a
public offering or an alternative value realization. Our community of
sophisticated individual investors with like-minded goals and values supports
our model, with their capital, knowledge, connections, and expertise. We
anticipate that value creation will be generated after any number of years of
patient ownership and corporate effort, and value realization might include any
number of methods, such as continued holding and operating, initial public
offerings, or IPOs, joint ventures, licensing, asset sales and merger
transactions, depending on the particular business model and industry.
We believe that we successfully have used the private and public capital markets
to finance growth companies. Being able to find disruptive technologies to
develop, acting as corporate founders, owners, directors and management, and
conducting investing activities for those companies in which we are
strategically involved for the long term, we believe we have a different model
of helping companies grow than that of the typical private venture capital
model. We refer to our approach as public venture capital. We find the
technology, and then we work to analyze the technology leadership position and
survey the marketplace so as to establish a research and development and
intellectual property development strategy to create a dominant position in the
distinct technology vertical. Then we create the basic company, we set up its
management, we define its business plan, we nurture its enterprise, and we
provide its financings in its early stage rounds of private funding, and then we
likely will act as the underwriter or selling agent for its later financings,
IPO, or disposition. It is our plan to remain involved with our partner
companies for the long term. Where there is an IPO, we plan to stay on for
several years thereafter, by being members of the board, having consulting
agreements, providing strategic business advice, and participating in, advising
on or facilitating further financing rounds. We believe, most importantly, that
one gauge of the partner company success is that the partner company
successfully completes public and private follow-on offerings or other value
realization events so as to continue supporting the research, development,
growth and marketing of their technologies’ potential.
Our public venture business model does not rely upon the receipt of operating
cash flows from our partner companies. We anticipate that our partner companies,
while we are invested in them and they are developing their businesses, will not
generate revenues or positive cash flow. To the extent our partner companies
generate any cash from operations, they will retain the funds to develop their
own businesses. Our overall day to day operations will rely on cash on hand,
cash flow from the operation of Public Ventures and PatentVest, and our ability
to generate cash from capital raising activities to finance our overall
operations and fund the partner companies. If we need capital to fund current
and new partner company relationships, we will seek to raise additional capital.
If we are unable to find ways of monetizing our holdings or to raise additional
capital on attractive terms, we may face liquidity issues that will require us
to curtail our new business efforts, constrain our ability to execute our
business strategy, and limit our ability to provide financial support to our
existing partner companies. We may also finance our partner companies through
their securities offerings or selling, licensing, or joint venturing their
businesses.
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Our Broker-Dealer Business
We operate a registered broker-dealer and conduct financing activities through
Public Ventures, LLC, or Public Ventures. Our broker-dealer is the backbone of
our community-oriented financing approach. Public Ventures is a registered
broker-dealer (CRD#: 42677/SEC#: 8-49951) under the Exchange Act and a member of
Financial Industry Regulatory Authority, Inc. (“FINRA”). This company, under its
predecessor name, MDB Capital Group, LLC, has conducted private and public
financing activities for more than twenty-five years, for a wide range of
clients, in diverse sectors of the economy. However, one theme of its clients
has always been involvement in technology. We intend to leverage the lessons
learned during our long operating history to create processes, due diligence
reviews, deal prioritization, rating systems, and reports that will allow the
investor community that adheres to the Public Ventures approach to appropriately
evaluate their investment risk and to foster informed decision making.
Public Ventures is in the process of expanding its business to include
securities clearing operations, oriented to the small and medium capital sized
companies, where the larger clearing firms do not appear to be interested.
Having a FINRA licensed, DTC, or Depository Trust Corporation, participant,
self-clearing broker-dealer will enable us to structure and place or underwrite
community based financing transactions and provide securities clearing services
so that investors can trade, clear, and settle stocks in the partner companies
and other small and micro-cap company securities. Our objective is to create a
high-end service platform that will make investing in the small and micro-cap
segment more accessible and efficient for our largely accredited investor
community.
The strategy of this business is to foster venture-stage businesses that are
supported and financed by a community of like-minded investors and entrepreneurs
experienced in the development of successful companies that have a long-term
investment horizon. We envision developing a subset of this close-knit community
of long-term public venture investor that will also be considered “Members.”
Member involvement may include suggesting start-up and developing companies as
potential investment opportunities and partner company candidates, making
investments in these entities and other targeted companies, and consulting with
our partner companies to help them grow into tomorrow’s leaders.
Our Patent and Intellectual Property Business
Another part of our operations includes PatentVest, Inc., or PatentVest. This
company is expanding its business operations in the restructured holding
company. We believe PatentVest can become the first venture invention and
commercialization intelligence platform, created to assist technologists,
advisors, venture capital investors, and established companies optimize
technology commercialization. Our process takes in information from our
proprietary patent database and transforms the information about inventions and
intellectual property from a complex legal process into a manageable, measurable
business process. The PatentVest process clearly defines the boundaries of an
invention by providing context for previously developed ideas and analyzes how
the invention, and therefore patent claims, differ from the discovered prior art
in order to rationalize the essential distinctions that are the key value
drivers. Understanding these boundaries, as well as how protectable and valuable
these boundaries are, is essential to better guide strategic business and
patentability decisions. In our experience, this PatentVest process answers the
most important questions for a technology platform: how to innovate, how to
improve its ideas, and how to deploy these ideas where they matter most.
PatentVest is a licensed law firm in Arizona through the newly established
Alternative Business Structure (ABS) program of that state. We believe that the
ABS program will enable PatentVest to deliver a cohesive solution to new
technology companies. PatentVest, as a law firm, will focus on intellectual
property matters, including patent prosecution, intellectual property protection
and licensing.
We believe that PatentVest will provide new investment opportunities for the
Public Ventures community and will serve as the team to execute the intellectual
property strategies for our partner companies.
Our Current Partner Company
Invizyne Technologies, Inc. or Invizyne, a partner company, was created in early
2019 with the vision of simplifying nature by using nature’s building blocks to
create molecules of interest. Invizyne has differentiated technology underlying
its unique synthetic biology platform which potentially solves the inherent
production bottlenecks of certain legacy technologies. The promise of synthetic
biology, we believe, has no bounds. If Invizyne’s technology platform is
successful at an industrial scale, we believe that it could significantly impact
several industries by enabling the exploration of a large number of molecules
and properties found in nature. For example, we believe that therapeutic
molecules found in nature could be tested for efficacy and quickly created and
scaled. Examples of where this has been important include with respect to
multiple cannabinoids and other natural compounds, quick replication of novel
properties of rare chemicals found in nature, creation of natural flavors and
fragrances to naturally enrich food, and the sustainable creation of fuel from
renewable energy sources.
MDB CG Management Company
MDB CG Management Company, Inc., or MDB Management, is principally an
“administrative” entity whose purpose is to conduct, and wherever possible, to
consolidate shared services/resources, for our US-based operations. This
includes entering into service agreements that are broadly applicable to one or
several of the group entities, hiring employees and independent contractors for
the wholly owned entities within the group, performing certain unregulated
administrative tasks, conducting unregulated recording keeping, leasing office
premises, and offering employee benefit programs, such as healthcare and 401K
plans.
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Our executive offices are located at 14135 Midway Road, Suite G-150, Addison, TX
75001. Our phone number is (310) 526-5000. Our website address is www.mdb.com.