Hong Kong-based investment firm Circus Capital has arguably the most interesting portfolio you're likely to find anywhere: assets include Alaska (Eskimos not included), Rapid BSE (faster than eating a British burger) and Cold Plasma (reminds me of my last girlfriend).

Actually these are names for high-tech commercial products being developed by the Defence Science Technology Laboratories of the UK's Ministry of Defense. Circus is the firm that is investing in these new technologies in a joint venture with the defence ministry.

Circus is led by Harvey Boulter and Paul Robinson, ex-bankers with aerospace backgrounds who have leveraged their contacts with Britain's defence establishment to set up a fund investing in commercial spin-offs. It is not a big operation - in addition to a more standard $150 million protected growth fund, its Technology Fund which partly invests in these new applications is only $8.5 million. Circus is now in the process of applying to the Hong Kong Securities and Futures Commission to authorize its sale. But for now it is only available privately through independent financial advisors such as Towry Law. Circus' investors come from Japan, Taiwan, Malaysia and Hong Kong as well as several Persian Gulf states.

Circus got its start because the principals were already in Hong Kong and sealed a distribution relationship here with Towry. Furthermore, while they are frequently in the UK, the clients are in Asia and the fund itself doesn't require day-to-day oversight. Part of the open-ended Technology Fund is actually a fund of global tech funds, and part is a direct investor in these UK defence spin-offs. Boulter and Robinson are pleased with the performance to date, noting that since its July 2000 launch the fund's return is 2.7%, while the Nasdaq is down 51.9% over the same time, and other large tech funds are even worse off.

The oldest project in the pipeline (they are all JVs with the Ministry of Defense) is called Alaska, and it derives from Porton Down, a chemical and biological defence lab in the UK, where they keep samples of 'category IV' bugs - the kind that kill, for which no vaccine has yet been developed. Porton Down works on developing defences against the likes of Osama bin Ladin or Saddam Hussein using bugs and chemicals for war.

But this has commercial applications as well in the realm of food poisoning. A lot of people die every year from food poisoning because it isn't diagnosed quickly - 5,000 in the United States alone. Alaska Food Diagnostics is the name for the technology that can detect bad bacteria in food, such as salmonella. Other technologies also do this, but they take up to a week to determine whether a food sample is safe; Alaska takes hours.

Circus reckons it can sell this technology to any company interested in food quality control. "This could have solved Snow Brand's milk scare," says Boulter, referring to the scandal-plagued Japanese dairy producer.

The firm has mandated KMPG to seek additional financing to put into Alaska. Boulton reckons the firm needs an additional ú2 million to further develop the technology. The payoff? He believes the margins on the technology will be huge, and says food testing is a $1 billion market.

The second JV is Rapid BSE, a technology that can detect whether an animal suffers from BSE (mad cow disease) within 15 minutes, long before an animal shows physical symptoms, and doesn't harm the animal. Current technologies require the animals be slaughtered to get at their spinal cords or brains, where BSE lurks, and then takes up to seven days to confirm. This sort of technology takes time to develop, and Circus is now trying to test it on cows in France, where the BSE outbreaks are about 10 years behind Britain's. Furthermore the defence ministry is still tweaking its patents. Boulter reckons it will be another year before Rapid BSE is in the market.

Last is Cold Plasma, which is a surface-coating technology that reduces friction against external things. Its origins are coatings on battlefield uniforms that resist chemical weapons. Circus envisages the same technology can waterproof just about anything, from clothes to mobile phones. It is also stainproof. "Your Hermes tie can become Lan Kwai Fong-resistant," jokes Robinson. Similarly it can be used for de-icing airplanes.

Circus says all these technologies have patents and have been tested in battlefields. They are chasing existing markets, not creating new ones. "The risk is the spin-off and selling it - in other words it's with the management, not the technology itself," says Boulter.