Innventure (INV) Sidoti Small-Cap Virtual Investor Conference summary

Business model and strategy

• Focuses on commercializing industrial B2B technologies from multinational R&D to address major unmet market needs, aiming for companies with enterprise values over $1 billion.

• Employs a proprietary four-stage downselect process: market need evaluation, technology assessment, financial qualification, and partner engagement.

• Targets later-stage risk profiles by launching companies based on proven technologies from large corporations, not startups.

• Became a public company in late 2024, achieving S-3 eligibility and reducing G&A costs as it matured.

• Accesses a $1.5 trillion annual multinational R&D pool for transformative technology opportunities.

Portfolio company highlights

• Accelsius, focused on direct-to-chip two-phase cooling for data centers, reached a $665 million valuation within four years, driven by AI and high-performance compute trends.

• AeroFlexx, offering sustainable packaging, secured major customers like Aveda for a 2027 global launch and has a $30 million pipeline.

• Refinity uses a fluidized bed process to convert mixed plastic waste into monomers, targeting a $400 billion market and planning a 10 kt plant startup in 2028.

• Accelsius and Refinity are majority-owned and consolidated; AeroFlexx is 37% owned and accounted for on the balance sheet.

• Over $50 million in bookings from operating companies, mainly Accelsius, with expectations for cash flow breakeven by year-end.

Accelsius technology and market dynamics

• Two-phase cooling uses dielectric refrigerant, enabling removal of up to 4,500 W per socket, far surpassing water-based solutions.

• Market shift driven by rising rack densities in data centers, making air cooling obsolete and liquid cooling essential.

• Two-phase cooling offers up to 59% 10-year TCO savings over air cooling and 17% five-year TCO savings over single-phase water.

• Additional OpEx savings from reduced pumping, higher facility water temperatures, and minimized equipment damage from leaks.

• Community pushback on water usage and sustainability concerns accelerate adoption of two-phase cooling, with 20%-70% water savings depending on location.