Troubled technology incubator Brainspark is restructuring in the hope of keeping its business afloat. The business has been forced to reduce its headcount to five. Chief executive Stewart Dodd and chief technology officer Noah Freedman have resigned and will remain as non-executive directors.
Chief financial officer, Jasper Judd, who joined the firm in March, said the headcount had come down significantly from what was once a 20-strong team. This will obviously have a significant impact on the firm’s portfolio, which has about 18 investments, half of which still have potential, says Judd. Internet education and online service for dental professionals, Smile-On recently secured GBP1.05 million of second round funding and another portfolio company, MetaPack, raised third round funding of GBP3.25 million from Cazenove Private Equity, Cross Atlantic Capital Partners and Top Technology.
Earlier this year, the firm was in takeover discussions with a number of parties but these failed to bear fruit. No decision has been made regarding the return of assets to shareholders and the business is implementing a scheme of arrangements with regards to the future.
“It is too early to say what effect this will have on our portfolio, but we are considering a number of options and are trying to move as quickly as possible,” said Judd.
Brainspark currently has cash reserves of around GBP7 million. As at June 30, 2001 consolidated net asset value of the business was GBP12.4 million, down from GBP20.5 million as at December 31, 2000.