Quantec Investment offer preview

Global leader in the characterisation, verification and application of bioactive milk proteins. Quantec supplies natural and effective ingredients to global health and wellness products.

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Overview

Quantec is the global leader in the characterisation, verification and application of bioactive milk proteins. It has evolved from a research and development company into a commercially led business, generating positive cash flows and NZD 4.6 million of revenue in FY21.

Quantec has invested heavily in research and development to create bespoke high value ingredients that enhance consumer health and wellness products. Its flagship ingredient is Immune Defence Proteins (IDP®), a unique and specific subset of more than 50 different whey proteins that naturally exist in milk, and that provides natural, verifiable, health benefits across a wide range of applications. Different formulations of IDP® have been tested in a range of preclinical trials and independent studies to ensure efficacy in applications including digestive health, immune support, oral care, pet health, and skincare, while also ensuring they are safe for ingestion and topical use.

Commercial interest in IDP® is growing, with customers secured across a range of food and beverage, personal care, health supplement and pet care markets. Quantec is now in the privileged position of having a clear and unique advantage in large markets protected by significant intellectual property. The business has established the supply chain, manufacturing relationships, brand and distribution to form the base from which to grow.

The Opportunity

There are significant opportunities across a wide range of health and wellness markets for natural ingredients that provide functional benefits and superior performance.

Demand for effective natural health and wellness products has grown significantly over the last decade, creating valuable market segments across a wide range of industries. This increasing demand is, in part, due to rising consumer awareness and concern regarding the effectiveness and health benefits of ingredients used in products. Businesses operating in these markets face increasing challenges to incorporate ingredients that fulfil consumer demands for a natural product, whilst also delivering on effectiveness and functional health benefits.

The Solution

Quantec is leveraging its leadership position in the characterisation, verification and application of bioactive milk proteins to create all-natural ingredients derived from milk that provide protection from cell damage, inflammation and infection.

These highly effective, natural, and unique multi-functional ingredients can be used to support immunity, digestive health, oral care, skin care, pet care, and infant products. The proven bioactive efficacy and novelty of Quantec’s milk protein blends creates functional and unique ingredients that provide a highly competitive differentiated offering for product manufacturers.

Products

Quantec’s expertise in the characterisation of milk proteins has enabled it to develop a range of ingredients that focus on specific health outcomes and target consumers, with customised and enhanced solutions developed with key customers for specific applications.

Quantec is currently focused on the sale and distribution of it flagship ingredient, IDP® as a product enhancing ingredient within a range of markets. It has developed and tested a variety of formulations to ensure efficacy across a range of applications, while also ensuring it is safe for ingestion and topical use.

To add further depth to the application knowledge and enhancement of IDP®, Quantec has also taken the ingredient through the full product development process, creating two retail ranges that use IDP® as a key ingredient.

Growth Strategy

Quantec’s growth strategy is centred on growing its leadership position in the verification and development of bioactive milk protein products, deepening its capability across core applications and creating value across the value chain.

The primary short term focus is on leveraging its intellectual property and expertise. This includes the sale and distribution of IDP® as an ingredient within the digestive and immunity markets, with the Petcare market also a target in partnership with key strategic customers.

The board has set the strategic goal of growing total revenue while continuously building knowledge and technology to solidify Quantec's leadership position in the market. The board is currently working on development projects with a number of overseas companies in support of this goal.

Although FY22 revenue was adversely impacted by Chinese lockdowns that affected a major bricks and mortar customer, Quantec is well positioned to return to profitable growth this year, with more than 65% of FY23 forecast revenue already locked in and the launch next month by a UK pet company of a jointly developed oral care product creating additional diversified revenue.

The Offer

Quantec is seeking to raise up to NZD 3m of capital at a pre-money valuation of NZD10m to support its growth strategy. Existing shareholders will be supporting the raise.

This offer is available to $250k+ wholesale investors, and further information is available for interested parties.


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About Snowball Effect

Snowball Effect is a New Zealand-based online investing marketplace, that enables New Zealand companies to offer shares to members of the public. Snowball Effect was founded in 2012 and launched in August 2014, after being one of the first to acquire an equity crowdfunding license from the New Zealand Financial Markets Authority (FMA). Over NZ$140 million has been raised on the platform.