On any scale, brains now good business

13/10/2020 - 14:00


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The brain has been the focus of some rare but intriguing moves by companies starting in WA.

On any scale, brains now good business
Tony Richter released his book at the Formulab IPO launch in 1995.

Watching BrainChip Holdings shares go for a huge run on the stock market last month led me to take a fascinating dive into history.

BrainChip listed in 2015 as a reverse takeover of a resources group, Aziana.

Its neural computing technology, which ‘self learns’ the same way the human brain does, launched at about 15 cents a share and briefly reached a peak around 40 cents each at that time, before dropping away. 

In 2017 it got back to around 35 cents, but that was not sustained and by late last year it had settled into a pattern well below 10 cents a share.

So that makes its sudden rise last month to around 70 cents each quite a jolt for shareholders.

A few days later, after a speeding ticket from the ASX, BrainChip revealed it had completed some initial functional testing that validated a key product’s design.

Given where technology is heading, especially the acceleration due to COVID-19, and BrainChip’s focus on ultra-low-power, high-performance artificial intelligence, it is perhaps no surprise that the market got excited, albeit dropping back somewhat immediately after that peak.

Just to be clear, BrainChip’s link to Western Australia is only tenuous these days.

When it listed, its founder and chief technology officer, Peter Van Der Made, was pictured in front of the Innovation Centre of WA where, it was reported, he’d spent a year or so earlier in the decade devising the technology. 

Today, a few key BrainChip people remain in WA, but it is essentially a US company. 

Nevertheless, I will claim it as a WA business.

That knowledge started my usual effort to group concepts rather than focus on one company or a particular stock.

And, of course, I did that with my usual parochialism to determine what WA organisations are focused on this particular area of the health market and related technology.

This sort of exercise usually digs out a host of related ideas; typically many more than ought to exist in a small, isolated city such as Perth.

The first that came to mind was Humm, a Perth-founded, now San Francisco-based, startup with operations in China.

Humm is developing a wearable device that stimulates the brain with the objective of improved learning and concentration. 

Having previously graduated from the Spacecubed Plus Eight program in Perth, Humm raised about $3.7 million from US-based investors last year to commercialise its headband technology.

But that was where my inspiration ended, as I struggled to think of more contemporaneous players in this particular space, beyond various listed biotechnology firms seeking to solve cancer issues, which included brain cancer. 

Perhaps being more executive and less journalist has finally taken its toll on my deeper market knowledge of tech and discovery taking place here. 

However, I did have a flashback to a company that hit the stock exchange 25 years ago with computer processing technology that was said to mimic the operations of the human brain.

I know this will test the memories of many readers, but I wrote quite extensively on a company called Formulab Neuronetics, which thrived during the late 1990s and enjoyed the dot.com boom before disappearing forever.

Just to be clear, I am not suggesting that any business today is emulating the ride of Formulab.

I am simply reminiscing about a stock that shot high and flamed out, as many ASX-listed businesses in technology (and mining for that matter) do.

It just happened to be promoting a brain-mimicking computer process.

Tony Richter was the very colourful entrepreneur who led Formulab, having worked on the technology privately since the mid-1980s.

He developed a strong following among some in the investment community despite no real delivery on technological success.

Just how eccentric was he by the standards of typical ASX IPOs?

When the Formulab float was formally announced, via the reverse takeover of Giltnet, Mr Richter used the press conference to launch his book: Richter’s Laws: A Handbook for Human Success in a Post-Computer World by WA author, the late Hal Colebatch.

The removable dust jacket had the more emotive words: “An Epic Story of One Man’s Mind and How His Reasoning Technology is Changing Your Life”.

The Formulab shell became the foundation of another far more successful company, Foundation Healthcare.

Whatever happened to Mr Richter and his ideas remains a mystery to me.


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