nextstage am - fpci championnes iii · 2019. 9. 24. · €420m 2 vehicles €96m 1 vehicle 216€m...

FPCI NextStage Championnes III

Investing in the growth of innovative SMEs

Why investing in Private Equity?

1- INVESTING IN THE REAL ECONOMY 2 - CREATE JOBS 3 - ACCELERATE GROWTH

Private equity plays a major role in the financing of French economy and allows companies’ development. It contributes to maintaining and reinforcing the industrial framework in the territories

In 2017, Private equity actors invested €11,5 Bn in France.

Private equity contributes to the creation of jobs in France.Between 2012 and 2017, on a France Invest sample, companies supported by private equity created 209,724 net jobs

The 3,137 French companies sample supported by French private equity represents €216Bn in 2017, which amounts for 1/5 of cumulated revenues of CAC40 groups for the same period.In 2017, the revenue of these companies rose 5,3%. For 5 years (2012 – 2017), the average annual activity growth is higher than the French nominal GDP and close to OECD’s countries nominal GDP.

Private Equity is an asset class which, in return for a blockage period and capital risk, allows to respond to 3 main objectives:

Private Equity“France Invest” Sample

FRANCE INVEST / EY June 30th 2017 – “Performance nette des acteurs francais du capital investissement à la fin 2017”*Performance on 15 CAC indexes with reinvested dividends (SME Method), Credit Suisse Hedge Funds Index, Prequin Real Estate.

France Invest – December 14th 2018 – CROISSANCE ET CREATION D’EMPLOIS DANS LES ENTREPRISES ACCOMPAGNEES PAR LES ACTEURS FRANCAIS DU CAPITAL INVESTISSEMENT

France Invest – April 3rd, 2018 – (2017) – “Activité des acteurs Francais du Capital Investissement”

French Nominal GDP*

OECD Nominal

GDP*

France Invest Sample

3137 companies

FPCI NextStage Championnes III - September 2019

A brief history of NextStage AM

NextStage AM created by founding partners Grégoire Sentilhesand Jean-David Haas

enters the capital of NextStage AM

Partners Nicolas de Saint Etienne, Vincent Bazi, and associates Aloys de Fontaines, and Michael Strauss-Kahn arrive

enters the capital of NextStage AM

4 associésgérants

74,8%

12,6%

12,6%

FIP & FCPI FPCI NEXTSTAGE SCA

Target ticket : €2.5m

Target ticket : €6m

EV : €10 to €40m

Rev. : €5 to €50m

Target ticket :€10 to €20m

EV : €25 to €200m

Rev : €10 to 500m

R e t a i l I nst i tut io n a l L o n g - t e r m ins t i tut io n a l

3 0 ve h ic le s

€420m2 ve h ic le s

€96m1 ve h ic le

216€m

€732m collected s ince inception, invested in 34 vehicles.

• €732 M raised since inception• 31 professionals • 71 unlisted investments • 32 unlisted SMEs in the portfolio

Launch of NextStage

Arrival of Senior Partners Pascal

Macioce and Craig Vachon

Arrival of Associate Julien Potier and

Senior Partner Jean-Marc Moriani

2002 2008-2009 2011-2012 2012 2015 2018- 2019


4

The team – NextStage AM

Grégoire SentilhesChairman

Citizen Entrepreneur and G20 YEA president

Jean-David HaasCEO and co-founder

Nicolas de Saint-EtienneManaging Partner

Private Equity team

Vincent BaziManaging Partner

Listed investment Team

Four partners

Jean-Marc Moriani, (61 yo)Senior Partner

Former CEO of Crédit Lyonnais Americas &

Deputy CEO of Natixis

Pascal Macioce (63 yo)Senior Partner

Former CEO of EY EMEIA In charge of Audit, Advisory, Legal and Fiscal transactions at Arthur Andersen

Guy Craig Vachon (55 yo)Senior Partner – Based in California

CFO of AnchorFree, CEO of Authentec(Bought by Apple in 2012)

Harvard teacher (business/organization)

Three senior partners

Marie-Léa SouryAssociate

4 years of investment experience

Arthur VignerasSenior Associate


Aloys de FontainesInvestment Director


Julien PotierInvestment Director


Michaël Strauss-KahnInvestment Director


Jérémy Ballet Associate


Private Equity team (2+ recruitments)

Enzo CardilloAnalyst


Pierre-Alexandre PrigentAnalyst


Olivier CharoussetSenior Associate

Bastien AversaAnalyst


Listed Investment team


FPCI NextStage Championnes III

The investment committee and dedicated team

10 of common experience

€332 M deployed on investments

53 supported companies

30 exits achieves since 2009Including 16 industrial exits

1 investment committee

2 non-deliberative votes

Compliance Officer and CFO

Collective decision-making

process

90+ years of cumulated SMEs

investment experience

6

3 dedicated managers

Dossier

1 associate

OR1 Investment Director

+1 Associate/Analyst

Allocated resources per dossier

1 associate

OR1 Investment

Director

« SHADOW »


Investment Criteria

We select the best opportunities from among:

✓ French or European SMEs managed by a team of highly experienced entrepreneurs who are shareholders themselves

✓ All sectors and industries

✓ generating turnover between €5 million and €50 million, with strong growth

✓ with an innovative approach to their market

✓ positioned to become market leaders

✓ demonstrating a proven, scalable and profitable business model


4 trends driven by the 3rd Industrial Revolution

EMOTIONAL VALUE AND CUSTOMER EXPERIENCE ECONOMYAbility to develop a strong brand image, which creates emotion and a strong customer experience

ON-DEMAND AND SHARING ECONOMYCreation of new services incorporating goods: i/ temporary provision of goods or persons, ii/ activities with recurring income and iii/ rental of services

INDUSTRIAL INTERNETAbility to achieve significant productivity gains through upstream / downstream AI integration to add value to the object

POSITIVE ECONOMY OR GREEN GROWTHCreation of sustainable wealth through regeneration of the surrounding environment


A proprietary deaflow

Data 31/12/2018

3 pillars of our proprietary dealflow

134 contributions supported since 2002

The entrepreneurs recommend NextStage AM

to other entrepreneurs

The NextStage AM ecosystem

Investors, partners, entrepreneurs, private

banks, wealth managers etc.

NextStage AM partners own network

Providing strong commitment among

entrepreneurs(Citizen Entrepreneur, G20

YEA for France…)

1 2 3

300 - 400 opportunities per

annum

5-10 investments

Almost half of the opportunities are tickets between €4M and €7M


Connecting the dots: Entrepreneurs-Investors Club


Our growth drivers and support framework

▪ Promoting co-creation and sharing among portfolio entrepreneurs (best practices, business opportunities etc.)

▪ Entrepreneurs Club 3 times a year

« CONNECTING THE DOTS »

▪ Acceleration of digital transformation

▪ Contribution to discussions about a switch to a platform model

ACCELERATING INNOVATION

1

▪ Support in more than 300 acquisitions since 2002

▪ Successful achievement of build-up strategies

SUCCESSFUL EXTERNAL GROWTH

2

▪ Through internal growth or acquisitions in Europe, the USA, Africa and Asia

▪ Experience in trading and selling companies (US, China and Japan)

SUPPORTING INTERNATIONAL DEVELOPMENT

3

▪ Implementation of performancemanagement tools

▪ Help in logistics tools settlement

OPTIMIZED PROCESSES AND PERFORMANCE

▪ Support of 134 entrepreneur since 2002

▪ Assistance in teamstrengthening (sales, marketing, digital, financial management, etc.)

STRENGTHEN GOVERNANCE AND TEAMS AROUND THE ENTREPRENEUR

4 5


Evolution of Our ESG Commitments Since 2008

2008

Gaïa Index annual report for ESG monitoring of listed shareholdings

Signing of the UN-sponsoredPrinciples for Responsible Investment (PRI)

Support by PWC in the annual review of ESG practices of the portfolio companies and publication of results in a dedicated annual report

Commitment to the "G20 of Entrepreneurs", "Citizen Entrepreneurs" and "France 2020"

Expansion Capital Active Investor Reporting

▪ An investment strategy that aims to grow companies that create jobs and growth

▪ An entrepreneur-investor approach: systematic presence on the board, awareness of ESG issues among participants

▪ Implementation of KPIs within investments

2012 2017

A few ESG indicatorsOverall ESG approach

Source: NextStage AM PwC 2017 Report

of the portfolio companies’ staff are

long-term employees (permanent contracts)

92%of the portfolio companies have

signed shareholder agreements

incorporating an ESG commitment

clause

100%

of the companies surveyed have

formalized a set of values that structure

their business and culture

73%of companies in the

portfolio have established collective measures for

aligning employee interests with the

company's results beyond legal obligations

33%


Investment Approach

Types of operations Financing of growth and transmission projects

Entry investment tickets €4 million to €7 million (sweet spot at €6 million) with reinvestment possibilities

Equity investments Minority or majority equity with little or no leverage

Participation in governance bodies Systematic

Divestment strategy Corporate, IPOs, financial


Structure – NextStage Championnes III

Fund NextStage Championnes III

Management company NextStage AM

Type FPCI (Professional Capital Investment Fund, or Retail Venture Capital Fund)

Size €100 million (hard cap 120€m)

Minimum investment €1 million

Hurdle rate 7%

Carried Interest 20%

Management fees (annual)2% total amount invested during the investment period, as determined at the close of the investment period

Organizational expenses 1%

Auditor KPMG

Depositary SGSS

Counsel Dechert

First Closing (expected) H2 2019

Duration 8 years (extendable to 10)

Investment period Maximum 5 years


Focus on the value creation of the Championnes II FPCIAbout the 9 exits realised as of 12/31/2018

1 Calculation of multiples based on various indicators (EBITDA, turnover, gross margin)Data as of 06/30/2018 on FPCI NextStage Championnes II exits

Analysis of value creation for the Championnes II FPCI

+25%

+162%Lever n°1GROWTH

6,4xAvg. multiple

at entry

7,9xAvg. multiple at

exit

65 M€Avg. turnover at

exit25 M€

Avg. turnover at

entry

Lever n°2MULTIPLE

214

92

199

-58

448

1

EV at entry Multiple effect Activity growth Debt effect EV at exit


Our track record – FPCI Championnes II

Past performance is no guarantee of future results and performance is not constant over time.

Emotional value and quality of experience On-demand and sharing economy Industrial internet Positive economy and green growth

1st quartile its in

category 1

1 Net IRR capital growth funds launched since1987, as of end 2018Sources : France Invest 2017, 25e édition,27 juin 2019, Performance nette des acteurs français du capital-investissement à fin 2018, for the FPCI NextStage Championnes II internal source

Companies Fund trend Development strategy AR at entry AR at exit AR increaseStaff at entry

Staff at exit

Staff growth Entry date Exit dateInvestment

periodPrimary

operationInvestment

ticketExit Multiple IRR

Companies leaving the FCPR K€

Integration of innovationInternational development

13 200 k€ 36 100 k€ + 173% 72 89 + 24% 6/26/09 6/21/12 3,0 years 4 229 Corporate 1,3x +9,1%


36 800 k€ 69 800 k€ + 90% 115 170 + 48% 6/25/10 4/7/14 3,8 years ✓ 4 759 Corporate 2,9x +33,1%

External growthTeambuilding




External growthIntegration of innovation



45 600 k€ 47 300 k€ + 4% 435 438 + 1% 6/14/13 11/17/16 3,5 years ✓ 1 250 Management 1,7x +17,6%

External growthTeambuilding



1 700 k€ 3 900 k€ + 129% 15 26 + 73% 11/3/14 9/30/16 1,9 years ✓ 920 B Series 2,1x +48,8%

External growthIntegration of innovation

13 000 k€ 26 700 k€ + 105% 120 215 + 79% 12/12/14 12/12/17 3,0 years ✓ 3 251 Management 2,0x +29,5%

External growth 83 800k€ 49 300 k€ -41% 450 219 -51% 4/10/13 04/25/19 6,1 years 6 458 Secondary 1,0x -0,6%

External growthInternational development

16 200 k€ 23 800k€ +47% 120 175 +45% 10/9/14 07/23/19 3,8 years 3 040 Secondary 1,4x +7,9%

Average 29 409 k€ 59 845 k€ 153 218 3,8 years 4 099 1,9x +19,8%

19,8% Gross IRR

8,3% net IRR


From investment in territories, to international development

Headquarters

Local offices


Key figures

Presentation

Founded in 2003, Cap Cinéma is a company specialized in the use of movie theaters and film projection (movie theatermanagement).

NextStage AM Investment thesis

▪ quality entrepreneur with real experience in the field▪ scalable model▪ market conducive to external growth▪ historically proven profitability▪ realistic business model and good buyout opportunities at

exit

Development focus

Organic and external growth: opening of 5 to 7 new multiplexes to achieve a maximum group of 20 multiplexes.

Source

Entrepreneur

Supported by:

With a degree in Economic Sciences, PhilippeDejust started his entrepreneurial adventure in1985 with the company Pixy photo, where he’sbeen in charge of developing a network of stores inFrance for 7 years. Then he joined La Centrale(school supplies) for 2 years before handling themanagement of the Blois Cinema in 1994, afterwhat he created Cap Cinéma.

Philippe DejustCEO

1st investment

July 2013

Vehicles involvedCACEIS FIP Axe Ouest2 / CACEIS FIP Région Ouest / FIP Pluriel

Ouest 4 / SG FIP Axe Ouest 2 / FCPR Championnes II / FCPR Rendment / FIP Rendement / FIP Rendement 2021

20multiplexes

+122%turnover between

2012 and 2017

89movie theaters

5thmultiplex operator

in France

2017 turnover

€41.3m +107employees

Emotional value economy

MINORITY

Overview Entrepreneur profile


Value creation

Investment thesisNextStage’s contribution

Exit detail

▪ Only player in TOP 10 in 10 years despite a mature environment

▪ Differentiating model (construction cost approach / offers innovative services)

▪ Strong and profitable internal growth capacity (offer meeting the unserved market players’ needs)

▪ Strong project pipeline

▪ Support / financing of a structuring acquisition to double in size and become the 4th largest player in the market

▪ Structuration of financial reporting and support in team growth (CFO, Communications, etc.)

▪ Delibaration and arbitration in order to optimize value creation.

▪ Establishment of an international competitive process with industrial actors and funds

▪ Selection of a pair of investment bankers to cover the spectrum

▪ Support for VDD and financial negotiation

▪ Selection of CGR (highlight of the strategic interest helping them to become #1)

Income statement (M€) Entry Exit

as at 12/31 2012 pre-money 2017 actual

Revenue 18.7 43.3

EBITDA 3.1 8.2

in % of revenue 17% 19%

EBIT 3.2 7.3


Net debt 17.5 51.2

EV 37.8 117.9

TV 20.3 66.6

in x EBITDA 12.14x 14.46x

in x EBIT 11.66x 16.25x

Number of employees 93 200

Purchaser

Created in 1966, CGR is the leading French operator in terms of number of implantation in the cinema industry. The group currently operates 72 movie theaters in France.

2017 turnover : €31.7m

Emotional value economy

MINORITY

CompanyInvest. ticket

Multiple IRRInvest.

duration

Company exited venture capital fund (FCPR) €m

6.3 2.0x 19.6% 3 years


Key figuresOverview

Presentation

Independent specialist in the distribution of automotive parts and spare parts (LV, ULV, heavy goods vehicles, agricultural public works, etc.), positioned in two product families: ▪ starters/alternators (or rotating machines)▪ braking and ground connection systems

Investment thesis

▪ team of experienced, recognized entrepreneurs▪ effective strategy enabling the company to continuously

outperform its market (esp. in a difficult environment)▪ specialist position, meaning that it does not have to be a

head-on competitor of existing players in the sector▪ setting up a structured company, organized around

customer service and innovation▪ solid plans for growth

Development focus

Structuring an offer for Amazon, sourcing external growth operations, defining new reporting formats

2017 turnover

€69.8m

+55employees

Supported by: MINORITY

Jean started his career in the automotive sector asa garage manager. After that, he moved on topositions as technical manager and then as salesmanager within companies in the automotivedistribution sector. He founded ACR System in1999 and approached Autec to pool their skills.

+90%turnover between

2016 and 2017

70,000product references

9distribution sites in

France

Jean RousseauCEO

29Major listed

manufacturers

source

Primary1st investment

July 2010

Vehicles involvedFCPR NextStage Championnes II / FIP Transmission 2006-2007 /

FIP Référence 2008 / FIP Sélection

Industrial internet

Entrepreneur profile


Value Creation

Purchaser

Autodis group: a major player in spare parts distribution and independent repair.

2018 revenue: €1.2bn

* Value creation by EBITDA growth is calculated with an EBITDA adjustment of +€1.6m as the accounting EBITDA does not consider the strong impact of the move on profitability in 2013


Exit detail

▪ French leader in the distribution of brake parts and starters/alternators

▪ One of the 1st platforms to communicate in EDI and be integrated into its customers' ERP systems

▪ Creation of a new national network capable of serving customers within 4 hours

▪ Structuring a Factor vs. traditional medium-term credit

▪ Hiring of the CFO and design of the new reporting format

▪ Sourcing of external growth operations

▪ Support in structuring an offer for Amazon

▪ Implementation of a competitive process with industrial actors

▪ Selection of the Autodistribution group accompanied by TowerbrookCapital

▪ Rationale for acquisition : to have an automated national platform able to deliver its customers within 4 hours (theirs was inadequate)

Income statement (€m) Entry Exit

as at 12/31 2009 figures 2013 figures (realized)

Revenue 37.2 69.8

EBITDA 3.6 6.6


EBIT 3.4 3.6


Net debt 2.2 8.8

EV 23.6 57.0

TV 21.4 48.2

in x EBITDA 6.49x 11.33x

in x EBIT 6.85x 15.93x

Number of employees 115 170

Industrial internet

MINORITY


Multiple IRRInvest.

duration


4.8 2.9x 33.8% 4 years


Entrepreneur profile

Positive and green growth economy

Presentation

Founded in 2009, GreenFlex created the concept of

SS2D, which proposes that companies include sustainable

development in their strategies. The company

has 2 areas of expertise:

• consulting : strategy and operational advice (action plan, etc.)

• financing : Technology and Energy

Investment thesis

• the only leasing company positioned on the reduction of energy costs

• leader in a “Blue Ocean” activity: SS2D

• strong growth and a profitable company from the outset

• international growth opportunities

• maturation of the business model

Development focus

Organic growth : acceleration of thedevelopment of the group and its restructuring.Acceleration of international development.

Supported by:

An entrepreneur, trained in IT, a specialist inBusiness Development, management and ITLeasing, he has created several companiesand held positions as CEO in France andabroad, in international high-tech and IT leasemanagement companies.

Frédéric Rodriguez

CEO

MINORITY

Overview Key figures

Source

Primary1st investment

March 2013

Vehicles involvedFCPR Championnes II / FCPI CAP 2017 ISF / FCPI CAP 2017 IR / FCPI ISF CAP 2018 / FIP Sélection

+450%revenue growth

between 2016 and 2017

18,000energy-saving action

plans

2017 revenue

€273 million

8external growth

transactions

+180employees

3,400daily users


Value creation


Exit detail

▪ A pioneering player, offering an innovative, global and fully integrated service approach around the reduction of energy bills;

▪ Establishment of a portfolio of first-class clients;

▪ A model generating growth and continuous profitability since its creation;

▪ Support with the acquisition of technological bricks to strengthen its leadership in environmental data mining;

▪ Support with internal structuring in order to support development (key recruits).

▪ Support with international deployment

▪ Implementation of a competitive process, interested to a leading bank, aiming to guarantee the liquidity of NextStage AM’s funds

▪ Support for the entrepreneur in the preparation and negotiations for the industrial exit of the group

ACQUIRER

Among the six largest oil companies in the world. Present in 130 countries with more than 100,000 employees, the group operates more than 16,000 service stations throughout the world.

2017 turnover : €172 bn

Positive and green growth economy

MINORITY


Multiple IRRInvest.

duration


5.6 2.0x 22.1% 4 years


The opportunity to invest in SMEs and:

Conclusion

✓ access a market segment that offers many investment opportunities and strong growth potential

✓ benefit from the expertise of a team that has been stable for 10 years with a track record above the market average and a proven ability to bring SMEs to the "Next-Stage" and increase their strategic value

✓ take advantage of the value creation resulting from an entrepreneurial approach and an “off the beaten track” dealflow that together make it possible to carry out many primary deals and exits via corporate acquisition


Disclaimer FPCI Championnes III

THIS DOCUMENT IS FOR THE EXCLUSIVE USE OF PROFESSIONAL INVESTORS TO WHOM IT HAS BEEN ADDRESSED BY NEXTSTAGE AM ITS CONTENT CAN NOT BE DISCLOSED TO THEIR CLIENTS OR ANY OTHER THIRD PARTY.

This presentation regarding NextStage Championnes III (the "Fund") is made on a confidential basis to a limited number of investors.The information contained in this presentation does not address the risk factors and other matters relating to an investment in the Fund. They are of a preliminary nature,subject to modification and correction, and no one should avail themselves of them.

The Fund will be a Professional Private Equity Fund (FPCI) structured under French law and open exclusively to professional and investors.

In accordance with the applicable French regulations, the Fund's units may only be subscribed or acquired by professional clients are defined under MIFID.

No guarantee can be given that the Fund's return on investment objectives will be met or that the amounts invested will be repaid.

This presentation does not constitute, and may not be used for the purposes of, an offer of shares or an invitation to participate in the Fund by any person in any jurisdictionin which such offer or invitation would not be permitted or in which the person seeking to make such an offer or invitation would not be permitted to do so or to a person whois prohibited from making such an offer or invitation. It is the responsibility of potential investors to ensure compliance with the laws and regulations of any related jurisdictionwith a request to participate in the Fund, including obtaining any required governmental or other approvals, and any other formality required in this territory.

The information contained in this presentation represents the appreciation and interpretation of NextStage AM's information at the date of this presentation. Some of theinformation contained in this presentation was obtained from published sources prepared by third parties. Neither NextStage AM nor any other person shall be held liablewith regards to the accuracy or completeness of this information.


19, avenue George V75008 Paris – FranceOffice : +33 1 44 29 99 [email protected]

http://www.nextstage.com/mailto:[email protected]

nextstage am - fpci championnes iii · 2019. 9. 24. · €420m 2 vehicles €96m 1 vehicle 216€m...

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