Venture capital investment into European companies experienced double digit .... BV. Netherlands. Consumer. Services. Tr
VentureSource
Europe -- 1Q 2014
VentureSource
The following report presents Dow Jones VentureSource’s quarterly findings for European venture capital fundraising, investment, and liquidity. The included charts and graphs offer a comprehensive view of the trends currently affecting the venture capital market. Highlights for 1Q 2014 include:
European venture capital fundraising fell nearly two-thirds from 4Q 2013;
Venture capital investment into European companies experienced double digit declines in both capital raised and deals completed compared with 4Q 2013;
While initial public offerings (IPOs) remain flat, an increase in mergers and acquisitions (M&As) during 1Q 2014 helps to exceed the previous quarter in venture-backed exit activity. To view Dow Jones VentureSource’s U.S. data for 1Q 2014 , please click here.
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VentureSource
European Venture Capital Fundraising Falls Significantly from 4Q 2013; Yearly Trend Continues
FUNDRAISING
A total of 20 European venture capital funds accumulated €640 million during 1Q 2014, equating to a decline of 63% in euros raised from 4Q 2013. The number of funds also fell sharply during the quarter to 20 from 34 in 4Q 2013, an overall drop of 41%.
Despite the amount raised falling 14%, the number of venture funds completing closings in 1Q 2014 improved by 43% from the 14 funds in 1Q 2013. The largest fund of the quarter was Life Sciences Partners’ Health Economics Fund , which raised €112 million and accounted for 18% of the total amount raised during 1Q 2014.
European VC Fundraising (2011 – 2014)
€ 2.50
40
Based on multiple closings 35 € 2.00 30 25
€ 1.50
20 € 1.00
15 10
€ 0.50 5 0
1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14
€ 0.00
Amount Raised (€B) € 0.43 € 0.63 € 0.42 € 2.15 € 0.98 € 1.12 € 0.76 € 1.09 € 0.74 € 0.99 € 0.50 € 1.72 € 0.64 Number of Funds 14 18 10 35 17 20 15 28 14 16 10 34 20
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Largest European VC Funds Raised in 1Q 2014
VentureSource FUNDRAISING
Firm Name
Fund Name
Amount (€M) Closed in 1Q
Location
Offering Status
Fund Type
Fund Category
Life Sciences Partners BV
LSP Health Economics Fund
€112.00
Amsterdam, Netherlands
Closed
Late-stage venture capital
Venture Capital
Earlybird Venture Capital GmbH & Co.
Earlybird Digital East Fund
€79.96
Berlin, Germany
Open
Early-stage venture capital
Venture Capital
Acton Capital Partners
Burda Digital Ventures Fund II
€79.96
Munich, Germany
Open
Late-stage venture capital
Seventure Partners SA
Health for Life Capital Fund
€62.00
Paris, France
Open
Emertec Gestion
Emertec 5
€50.00
Grenoble, France
Open
Closing Type
Final
First
Venture Capital
First
Multi-stage venture capital
Venture Capital
First
Early-stage venture capital
Venture Capital
First
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VentureSource
Investment into European Venture-backed Companies Experiences Decline from 4Q 2013
FINANCING
European companies raised €1.4 billion for 336 deals during 1Q’14, a decline of 21% in the number of deals and 14% in capital raised from the previous quarter. In contrast with 1Q’13 figures, despite deal flow decreasing by 2%, investments improved by 23%.
Consumer Services and Business and Financial Services were the quarter’s strongest sectors, respectively attracting a 30% and 27% share of total amount invested.
Equity Financings into Europe – based, VC-backed Companies (2011 – 2014)
€ 2.00
450
€ 1.80
400
€ 1.60
350
€ 1.40
300
€ 1.20 250 € 1.00 200
€ 0.80
150
€ 0.60 € 0.40
100
€ 0.20
50
€ 0.00
1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14
0
Amount Raised (€B) € 1.40 € 1.24 € 1.23 € 1.44 € 1.07 € 1.47 € 1.13 € 1.22 € 1.16 € 1.80 € 1.28 € 1.65 € 1.43 Number of Deals 299 393 303 356 331 355 314 350 344 402 361 427 336
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VentureSource FINANCING
Equity Financings into Europe-based, VC-backed Companies, by Round Class (2011 – 2014) Number of Deals
200
160
120
80
40
0 Seed
1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 19 36 30 42 28 36 47 54 26 32 46 65 29
First
145
187
162
158
157
178
151
178
187
200
185
192
189
Second
62
86
51
62
62
62
55
59
62
87
59
76
59
Later
58
56
50
71
71
55
45
39
53
63
51
80
49
Restart
0
1
2
3
0
0
0
0
0
0
0
0
0
6
VentureSource FINANCING
Equity Financings into Europe-based, VC-backed Companies, by Round Class (2011 – 2014) Amount Raised (€M)
€ 1,000 € 900 € 800 € 700 € 600 € 500 € 400
€ 300 € 200 € 100 €0 Seed
1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 €8 € 16 € 20 € 22 € 11 € 23 € 12 € 20 € 12 € 15 € 16 € 22 € 14
€ 393 Second € 260 Later € 677 First
Restart
€0
€ 383
€ 572
€ 406
€ 291
€ 446
€ 279
€ 430
€ 382
€ 417
€ 457
€ 350
€ 398
€ 313
€ 206
€ 360
€ 292
€ 256
€ 304
€ 330
€ 226
€ 478
€ 307
€ 383
€ 301
€ 423
€ 320
€ 607
€ 463
€ 676
€ 528
€ 436
€ 532
€ 877
€ 449
€ 879
€ 616
€0
€ 69
€ 15
€0
€0
€0
€0
€0
€0
€0
€0
€0
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VentureSource FINANCING
Equity Financings into Europe-based, VC-backed Companies, Median Equity Deal Size (€M) (2011 – 2014)
€ 2.50
€ 2.00
€ 1.50
€ 1.00
€ 0.50
€ 0.00
1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Median Equity Deal Size (€M) € 1.50 € 1.50 € 1.55 € 1.50 € 1.53 € 1.91 € 1.20 € 1.33 € 1.58 € 1.53 € 1.03 € 1.48 € 1.80
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VentureSource
Equity Financings into Europe-based, VC-backed Companies, by Industry Group (1Q 2014)
FINANCING
The Consumer Services sector received the largest allocation of investment during 1Q’14 (30%), accumulating €422 million through 101 deals. The figures represent a respective decline of 39% and 23% from 4Q’13.
Business and Financial Services placed second in terms of equity financing, taking a 27% share of all 1Q’14 investment. The sector raised €385 million across 104 deals, an increase of 54% in capital raised despite an 8% dip in deal flow. The sector’s investment total is the largest for a single quarter since 3Q’01.
Healthcare ranked third, with companies gathering a 23% share of the total amount invested during the quarter. The sector received €327 million across 42 deals, a fall of 25% in deals completed, and 14% in capital raised from 4Q’13.
1Q’14 Industry Breakdown By Amount Raised
1Q'14 Industry Breakdown By Number of Deals 13%
Business and Financial Services 19%
Business and Financial Services 27%
1% 31%
2%
Consumer Goods
Consumer Goods
Consumer Services
Consumer Services 23%
12%
2%
Energy & Utilities 4%
2%
Energy & Utilities Healthcare
Healthcare 4% Industrial Goods & Materials
30%
Industrial Goods & Materials
30% Information Technology
Information Technology
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Top 5 Deals into European VC-backed Companies (1Q 2014)
VentureSource FINANCING
Location
Industry Group
Industry Segment
Industry Code
Brief Description
Close Date
Round Type
Raised (€M)
Sweden
Business and Financial Services
Financial Institutions and Services
Payment/ Transactional Processing
Provider of a payment solution for ecommerce stores in Europe.
3/16/2014
Acquisition Financing
€90.00
Takeaway.com Netherlands BV
Consumer Services
Travel and Leisure
Restaurants/Food Provider of online food Service ordering services.
3/31/2014
Later
€74.00
Macquarie Capital Inc., Prime Ventures NV, Individual Investors,
Delivery Hero Holding GmbH
Consumer Services
Consumer Information Services
Co. Name
Klarna AB
Glycotope GmbH
Germany
Germany
Novimmune SA Switzerland
Healthcare Biopharmaceuticals
Healthcare Biopharmaceuticals
Round Investors (* denotes lead)
Atomico, General Atlantic LLC, Management*, Sequoia Capital
Shopping Facilitators
Provider of an online food ordering platform.
1/13/2014
5th
€64.29
Insight Venture Partners*
Biotechnology Therapeutics
Provider of new technologies to optimize the glycosylation of biopharmaceuticals.
3/11/2014
Later
€55.00
ELSA Eckert Life Science Accelerator GmbH, Jossa Arznei GmbH*
Biotechnology Therapeutics
Developer of antibodybased drugs for the treatment of inflammatory diseases, immune-related disorders, and cancer.
2/18/2014
Later
€49.10
Rosetta Capital Ltd.*, Individual Investors
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VentureSource FINANCING
Most Active Investors for Europe-based, VC-backed Companies by Deals Completed (1Q 2014)
35 30 30
25
20
15
9
10
8
7
6
5
0 Internet Initiatives Development Fund
High-Tech Gruenderfonds Management GmbH
Index Ventures
SEED Capital Management I/S
Jenson Funding Partners LLP
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Equity Financings into Europe-based, VC-backed Companies, by Country (1Q 2014)
VentureSource
The U.K. remained the favoured destination for equity financing in 1Q’14 with a 26% share of investment into European VC-backed companies. The country received €372 million across 84 deals, a drop of 19% from 4Q’13 in both deal flow and capital raised.
FINANCING
Germany placed second with a 17% share of investment, raising €246 million across 42 deals, a decline of 39% in euros raised and 37% in deal flow from the previous quarter. Sweden consolidated third spot, raising €171 million, representing a 12% share of investment. France placed fourth with an 11% share, raising €164 million during 1Q’14. It was the country’s lowest quarterly investment total since 3Q’12.
Number of Deals in 1Q' 2014 by Country (Top 4)
Amount Raised in 1Q 2014 by Country (Top 4)
25%
26% United Kingdom
36%
United Kingdom
34%
France
Germany
Germany
Sweden
Russia
France
Rest of Europe
Rest of Europe
15% 17% 11% 12%
12%
12%
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VentureSource
Venture Exits in Europe Experience Overall Uptick in 1Q 2014
LIQUIDITY
A total of 42 venture-backed M&As took place in Europe during 1Q’14, an increase of 14% from 4Q’13 and 24% from 1Q’13.
The largest M&A of 1Q’14 was for Oxford-based NaturalMotion Ltd., a 3-D character animation technology provider, which was acquired by Zynga Inc. for €383 million.
Eight venture-backed IPOs took place during 1Q’14, the same as 4Q’13 and joining it as the highest quarterly figure since 2Q’10. Companies raised € 449 million during 1Q’14, the largest figure for a single quarter since 2Q’07.
Exit Opportunities for European VC – backed Companies (2011 – 2014)
1Q'14 4Q'13 3Q'13 2Q'13 1Q'13 4Q'12 3Q'12 2Q'12 1Q'12 4Q'11 3Q'11
2Q'11 1Q'11 0 IPOs
1Q'11 3
M&As
50
10 2Q'11 3Q'11 7 3 56
50
20 4Q'11 2
1Q'12 6
30 2Q'12 3
3Q'12 2
40 4Q'12 5
1Q'13 1
50 2Q'13 4
3Q'13 3
45
35
42
28
43
34
35
40
60 4Q'13 8 37
70 1Q'14 8 42
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VentureSource
Top 3 M&As in Europe (1Q 2014)
LIQUIDITY
Company Name
NaturalMotion Ltd.
Activaero GmbH
Location
Oxford, U.K.
Brief Description
Industry Group
Close Date
Round Type
Amount Paid (€M)
Acquirer
Software
Information Technology
1/30/2014
Acquisition
€383.08
Zynga Inc.
Drug Delivery
Biopharmaceuticals
Healthcare
3/13/2014
Acquisition
€130.00
Vectura
General Media/Content
Media and Content
Consumer Services
3/11/2014
Acquisition
€119.53
Warner Bros. Television Group
Provider of 3-D character animation technology which combines biology and Graphics/Publishing computer science to Software create animations for electronic entertainment and simulations.
Provider of controlled Gemuenden, breathing drug delivery Germany technologies.
Eyeworks Holding Amsterdam, B.V. Netherlands
Industry Segment
Industry Code
Provider of television (TV) production services.
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VentureSource
European VC-backed IPOs (2011-2014)
LIQUIDITY
Eight IPOs were completed during 1Q’14, equalling that of 4Q’13 and representing the highest number of venture-backed IPOs in a quarter since 2Q’10 when 10 were completed. During 1Q’14, IPOs raised €449 million, up 23% on 4Q’13 and the largest quarterly amount since 2Q’07 when 18 IPOs took in €467 million. The largest European VC-backed IPO of 1Q’14 was King Digital Entertainment’s March listing on the New York Stock Exchange. The company raised a total of €253 million, representing 56% of the total amount raised by European venture-backed companies for the quarter.
European VC-backed IPO Activity (2011 - 2014)
€ 500.00
9
€ 450.00
8
€ 400.00
7
€ 350.00
6
€ 300.00 5 € 250.00 4 € 200.00 3
€ 150.00 € 100.00
2
€ 50.00
1
€ 0.00
1Q'11
2Q'11
3Q'11
4Q'11
1Q'12
2Q'12
3Q'12
4Q'12
1Q'13
2Q'13
3Q'13
4Q'13
1Q'14
0
Raised (€M) through IPO € 259.71€ 355.76 € 65.15 € 18.66 € 157.40 € 26.76 € 52.08 € 142.99 € 19.22 € 71.56 € 25.51 € 364.20€ 448.63 Number of IPOs 3 7 3 2 6 3 2 5 1 4 3 8 8
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VentureSource
Top 3 IPOs in Europe (1Q 2014)
LIQUIDITY
Company Name
Country
Brief Description
Industry Code
Industry Segment
Industry Group
Close Date
Raised through IPO (€M)
Exchange/ Symbol
King Digital Entertainment PLC
Ireland
Provider of entertainment and games for the mobile world.
Entertainment
Consumer Information Services
Consumer Services
3/26/2014
€253.19
NYSE: KING
uniQure BV
Netherlands
Developer of gene therapies for genetic or acquired diseases.
Biotechnology Therapeutics
Biopharmaceuticals
Healthcare
2/5/2014
€68.06
NASDAQ: QURE
Provider of research tools to support translational Drug Development genomics research and Biopharmaceuticals Technologies the development of personalized medicines.
Healthcare
3/27/2014
€48.52
AIM: HZD
Horizon Discovery Group PLC
United Kingdom
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