Partners
XL TechGroup maintains a consistent flow for its project pipeline through its extensive, high-quality network of Discovery and Technology Partners, which is continuously enriched by adding new members.
Corporate Discovery Partners
A key component of XL TechGroup's systematic process is the Discover phase, in which XL TechGroup leverages an extensive list of industry contacts and partners to identify and validate significant unmet market needs. These Discovery Partners also serve as future market channels for developed solutions, as well as potential acquirers of XL TechGroup's subsidiary companies.
The incentive for a company to participate as a Corporate Discovery Partner arises from the uniqueness of the XL TechGroup business model. XL TechGroup provides its partners access to innovative new market solutions and the corresponding new revenue opportunities without the risks and roadblocks typically associated with large-company innovation. Many of the Corporate Discovery Partners that XL Vision/TechGroup has worked with are Fortune 100 companies.
Technology Partners
Another key component of XL TechGroup's systematic process is the Match phase, in which XL TechGroup leverages its portfolio of Technology Partners across organizations such as universities, government institutions and corporations on a global basis, including the US, the EU, Australia and Israel. By beginning with an unmet need, XL TechGroup can compose a technical specification that enables it to very rapidly find the best-in-class technical solution(s). The identified technology is often at a more mature stage of development (many years and millions of dollars already invested), likely repurposed from its originally intended use, and frequently has patents associated with it. This approach allows XL TechGroup to find solutions that can reach the market faster, more often, and more successfully than through the traditional venture capital model, which only analyzes a technology for its intended use. Moreover, by negotiating the exclusive rights for the technology as part of an up-front option agreement with the Technology Partner, XL TechGroup is able to leverage most favorable terms while reducing the risk of full acquisition.
XL TechGroup offers expertise and opportunities to its Technology Partners that are distinctly different from venture capital groups or companies that typically acquire intellectual property.
- The venture capital model typically splits its focus among many projects each year, using discovered technologies as the starting point, and then attempting to leverage them into relevant markets. In such a model, high project volume is necessary to maximise the chances that at least some technologies will turn out to have applicable markets. XL TechGroup, on the other hand, by starting with large, substantiated, global unmet market needs, can focus its attention on fewer projects with immediate market relevance. Therefore, inventions committed to the XL TechGroup business model, and the Technology Partners who provide those inventions, have a much higher probability of commercialization success.
- Inventions acquired by large corporations often fall victim to a “not invented here” bias or are simply lost in the queue of numerous technologies to be considered. On the other hand, each technology acquired by XL TechGroup becomes the basis of its own company, with its own management team and financed resources.
- XL TechGroup provides financial support to the Technology Partner in the form of an option, in return for an exclusive right to the technology. If, during the option period, the technology is proven to be an unfit match for the unmet need, XL TechGroup will return all IP to the partner, as well as the significant analysis already conducted by XL TechGroup. This analysis often enables Technology Partners to find other paths to commercialization for inventions that XL TechGroup has declined to acquire.
- Typical venture capital models involve successive rounds of funding and increasing dilution to the technology originators. Conversely, XL TechGroup provides significant initial funding, leading to less dilution for the partner. XL TechGroup's typical deal structure with Technology Partners contains specific anti-dilution provisions as well as equity participation. In addition, the agreement typically provides for sponsored research with the Technology Partner, keeping the Partner and inventor(s) actively engaged.
If your company has any interest in becoming a Discovery or Technology Partner, please contact partners@xltg.com