June 26, 2015 / 6:20 AM / 4 years ago

UK online pioneer hopes to strike oil with new tech venture

LONDON (Reuters) - One of the three founders of pioneering British online grocery retailer Ocado, which has warehouses but no stores, has taken control of a Silicon Valley-based firm with a similarly unique approach to the exploration for natural resources.

Jonathan Faiman made his name in Britain in 2000 when, with no retail experience, he joined two other investment bankers from Goldman Sachs to form the online supermarket which rivals said would never work but is now a common sight on Britain’s high streets with its colorful delivery vans.

Having left Ocado as a director in 2010, the 46-year-old Faiman has now spent $150 million to buy into and become chairman of NEOS, a private firm that helps to predict which resources lie under the ground by using proprietary systems to analyze both their own and other parties’ data.

Investors include Goldman Sachs, Bill Gates and venture capital firm Kleiner, Perkins, Caufield and Byers which has also invested in the likes of Amazon and taxi service Uber.

“With NEOS I saw an opportunity that we could provide countries with a good vision of what’s under their country,” Faiman told Reuters in an interview. “Not only a vision but a value as well.

“This is less risky than Ocado because it’s already set up and working but I think that the prize here is a very big one.”

The firm, which was founded by an ex-NASA engineer, works to produce a 3D model of the subsurface to help clients in the oil and gas and mining industries make their decisions about where to explore and where to drill.

It is also increasingly looking at working with governments to interpret multiple geological, geophysical and geochemical datasets in the hunt for water and other resources.


Faiman, who left Goldman at 30 to set up Ocado, said he sees many similarities between the two industries he has worked in, with some of the larger players in the oil and gas industry following the large British supermarkets by failing to acknowledge that things can be done differently.

Ocado now has a market value of 2.4 billion pounds ($3.8 billion), although it has struggled to make a profit.

He believes NEOS can analyze large areas at a lower cost than more traditional methods such as seismic exploration, meaning the firm has the potential to offer a helping hand to oil firms grappling with the lower oil prices, while also posing a challenge to the exploration sector.

“One similarity is that the incumbents don’t value this as an approach,” he said. “And that’s a big advantage because if they did value it then this wouldn’t be an opportunity.”

With around 60 employees, NEOS has previously partnered with ExxonMobil, Shell and others to work in highly explored regions as well as unexplored greenfield locations.

It has also worked with countries such as Argentina and Lebanon and is in advanced talks to work in Cyprus.

Faiman said NEOS, which is profitable, was valued at $320 million when he invested in it last month.

Reporting by Kate Holton; Editing by Elaine Hardcastle

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