VentureSource

Europe -- 2Q 2014

VentureSource

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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 2Q 2014 include:

European venture capital fundraising rallied from customary first quarter decline to match 2Q 2013;

Venture capital investment into European companies improved to reach highest quarterly investment

figure since 3Q 2001;

Despite a slide in mergers and acquisitions (M&As), overall exit activity improved from the previous

quarter due to the highest number of initial public offerings (IPOs) in a quarter since 4Q 2006.

To view Dow Jones VentureSource’s U.S. data for 2Q 2014 , please click here.

VentureSource

FUNDRAISING

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2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14

Amount Raised (€B) € 0.63 € 0.42 € 2.17 € 0.98 € 1.18 € 0.76 € 1.09 € 0.74 € 1.03 € 0.50 € 1.79 € 0.65 € 1.03

Number of Funds 18 10 36 17 21 15 28 14 17 10 36 20 20

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€ 2.50 European VC Fundraising (2011 – 2014) Based on multiple closings

European Venture Capital Fundraising Rallies in 2Q 2014

20 European venture capital funds accumulated €1.03 billion during 2Q 2014, equating to an increase of 58% in

euros raised from 1Q 2014 despite the number of fund closings remaining flat. Though level with 2Q 2013, the

raised figure falls short of the €1.18 billion raised during 2Q 2012.

A total of €1.68 billion were raised by 40 European venture capital funds during the first half of 2014,

representing a dip of 5% in euros raised despite fund closings increasing by 29% from the first half of 2013.

The largest fund of the quarter was Index Ventures’ VII LP fund which raised €400 million, and accounted for

39% of the total amount raised for 2Q 2014.

VentureSource

FUNDRAISING

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Largest European VC Funds Raised in 2Q 2014

Firm Name Fund Name Amount

(€M) Closed in 2Q

Location Offering Status

Fund Type Fund Category Closing Type

Index Ventures Index Ventures VII LP €400.00 Geneva,

Switzerland Closed

Early-stage venture capital

Venture Capital

Final

Balderton Capital Management LLP

Balderton Europe V LP €221.10 London, United

Kingdom Closed

Early-stage venture capital

Venture Capital

Final

Quadrivio SGR Fondo TT Venture Due €100.00 Milan, Italy Closed Early-stage

venture capital

Venture Capital

Final

IBB Beteiligungsgesellschaft GmbH

VC Fonds Technologie Berlin II

€60.00 Berlin,

Germany Closed

Multi-stage venture capital

Venture Capital

Final

Hermes Fund Managers Ltd. Hermes GPE PEC II LP €54.08 London, United

Kingdom Open

Multi-stage venture capital

Venture Capital

First

VentureSource

FINANCING

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Equity Financings into Europe –

based, VC-backed Companies

(2011 – 2014)

Investment into European Venture-backed Companies Improves in 2Q 2014

European companies raised €2.1 billion for 365 deals during 2Q 2014, an increase of 2% in the number of

deals and 41% in capital raised from the previous quarter. 2Q 2014 enjoyed the highest quarterly investment

figure since 3Q 2001 when €2.7 billion were raised.

In contrast with 2Q 2013 figures, despite deal flow decreasing by 10%, investment improved by 42%.

For the first half of 2014, European venture-backed companies drew in €3.6 billion in 723 deals, a decline of 5%

in deals completed but a rise of 35% in euros invested from the first six months of 2013 .

2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14

Amount Raised (€B) € 1.24 € 1.24 € 1.44 € 1.08 € 1.48 € 1.14 € 1.25 € 1.19 € 1.49 € 1.30 € 1.69 € 1.50 € 2.12

Number of Deals 394 309 364 339 363 321 364 356 406 375 464 358 365

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FINANCING

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Equity Financings into Europe-based, VC-backed Companies, by Round Class

(2011 – 2014)

Number of Deals

2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14

Seed 37 31 43 32 37 50 58 29 31 50 73 28 19

First 187 165 164 160 184 155 180 191 203 193 208 199 180

Second 86 52 62 62 61 55 60 63 88 61 79 64 83

Later 56 50 72 70 54 45 42 53 62 51 80 53 70

Restart 1 2 3 0 0 0 0 0 0 0 0 0 0

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VentureSource

FINANCING

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2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14

Seed € 16 € 21 € 22 € 15 € 23 € 13 € 26 € 17 € 12 € 16 € 22 € 16 € 17

First € 384 € 573 € 419 € 302 € 458 € 288 € 437 € 393 € 421 € 461 € 352 € 414 € 550

Second € 315 € 214 € 355 € 293 € 255 € 304 € 334 € 224 € 481 € 311 € 386 € 318 € 401

Later € 423 € 325 € 602 € 459 € 673 € 529 € 447 € 543 € 563 € 456 € 900 € 634 € 973

Restart € 0 € 69 € 15 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0 € 0

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Equity Financings into Europe-based, VC-backed Companies, by Round Class

(2011 – 2014)

Amount Raised (€M)

VentureSource

FINANCING

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Equity Financings into Europe-based, VC-backed Companies, Median Equity Deal Size (€M)

(2011 – 2014)

2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14

Median Equity Deal Size (€M) € 1.50 € 1.54 € 1.41 € 1.53 € 1.90 € 1.20 € 1.22 € 1.54 € 1.52 € 1.00 € 1.29 € 1.75 € 2.17

€ 0.00

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VentureSource

FINANCING

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30%

4%

30%

3%

14%

3%

16% Business and Financial Services

Consumer Goods

Consumer Services

Energy & Utilities

Healthcare

Industrial Goods & Materials

Information Technology

2Q'14 Industry Breakdown

By Number of Deals

Equity Financings into Europe-based, VC-backed Companies, by Industry Group

(2Q 2014)

The Consumer Services sector received the largest allocation of investment during 2Q 2014 (37%),

accumulating €788 million through 109 deals. While deal flow picked up by just 2% from 1Q 2014, sector

investment rose by 76%. The five largest deals completed for the quarter were all for companies in Consumer

Services.

Business and Financial Services placed second in terms of equity financing, taking a 26% share of all 2Q 2014

investment. The sector raised €540 million across 108 deals, an increase of 33% in capital raised despite a 5%

dip in deal flow. The sector’s investment total was the largest for a single quarter since 1Q 2001.

Healthcare remained third, with companies gathering 18% of the total amount invested during the quarter. The

sector received €375 million across 52 deals, an uptick of 6% in both deal flow and capital invested from 1Q

2014.

26%

1%

37%

3%

18%

3%

12% Business and Financial Services

Consumer Goods

Consumer Services

Energy & Utilities

Healthcare

Industrial Goods & Materials

Information Technology

2Q’14 Industry Breakdown

By Amount Raised

VentureSource

FINANCING

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Co. Name Location Industry Group

Industry Segment

Industry Code Brief Description Close Date Round Type

Raised (€M)

Round Investors (* denotes lead)

Ozon Group Russia Consumer Services

Consumer Information

Services Shopping Facilitators

Provider of Internet- based retail services.

29/4/2014 Corporate €108.74

Mobile TeleSystems OJSC,

Sistema JSFC

Kobalt Music Group Ltd.

United Kingdom

Consumer Services

Media and Content

Movie/Music Producers and

Distributors

Provider of music publishing, neighboring

rights, and label services worldwide.

4/6/2014 Later €84.36 Balderton Capital

Management LLP, Individual Investors

Sarenza SA France Consumer Services

Retailers Clothing/Accessory

Retailers Provider of an online

food ordering platform. 25/6/2014 5th €74.00

Bpifrance Investment*, HLD Associes SCA, Individual

Investors

Comuto SAS France Consumer Services

Travel and Leisure

Transportation Services

Provider of a car journey-sharing

platform. 30/6/2014 Later €73.36

Accel Partners, Index Ventures*, Isai SAS, Lead

Edge Capital

Delivery Hero Holding GmbH

Germany Consumer Services

Consumer Information

Services Shopping Facilitators

Provider of an online food ordering platform.

23/4/2014 Other Early

Stage €61.62 Luxor Capital Group*

Top 5 Deals into European VC-backed Companies (2Q 2014)

VentureSource

FINANCING

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Index Ventures High-TechGruenderfondsManagement

GmbH

BpifranceInvestment

SofinnovaPartners

Caixa CapitalRisc SGECR

Alven Capital BaldertonCapital

ManagementLLP

IdinvestPartners

Most Active Investors for Europe-based, VC-backed Companies by Deals Completed

(2Q 2014)

VentureSource

FINANCING

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Amount Raised in 2Q 2014 by Country

(Top 4)

28%

19%

15%

8%

30% United Kingdom

France

Germany

Netherlands

Rest of Europe

26%

20%

13%

8%

33% United Kingdom

France

Germany

Spain

Rest of Europe

Number of Deals in 2Q' 2014 by Country

(Top 4)

Equity Financings into Europe-based, VC-backed Companies, by

Country (2Q 2014)

The U.K. remained the favoured destination for equity financing in 2Q 2014 with a 28%

share of investment into European VC-backed companies. The country received €598

million across 97 deals, an increase of 7% in deal flow and 58% in amount invested

from 1Q 2014.

France placed second with a 19% share of investment. While deal flow saw an

increase of 42% from 1Q 2014 with 74 completed, investment more than doubled from

the €184 million drawn in during the previous quarter to reach €395 million.

Germany occupy third spot, raising €322 million, representing a 15% share of

investment. The Netherlands rose to fourth spot with an 8% share, raising €166 million

during 2Q 2014. It was the country’s highest quarterly investment total since 3Q 2000.

VentureSource

LIQUIDITY

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Exit Opportunities for European

VC – backed Companies

(2011 – 2014)

Venture Exits in Europe See Overall Increase in 2Q 2014 Despite M&A Slide

38 venture-backed M&As took place in Europe during 2Q 2014, a decline of 19% from 1Q 2014 but an uptick of

6% from 2Q 2013.

The largest M&A of 2Q 2014 was Crossknowledge Group Ltd., a corporate e-learning service provider, which

was acquired by John Wiley & Sons for €127 million.

19 venture-backed IPOs took place during 2Q 2014, 11 more than in 1Q 2014 and the most since 4Q 2006.

Companies raised €407 million for their listings during 2Q 2014, a slight decline from the €449 million seen in

1Q 2014.

0 10 20 30 40 50 60 70

2Q'11

3Q'11

4Q'11

1Q'12

2Q'12

3Q'12

4Q'12

1Q'13

2Q'13

3Q'13

4Q'13

1Q'14

2Q'14

2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14

IPOs 7 3 2 6 3 2 5 1 4 3 9 8 19

M&As 56 50 45 36 42 29 44 34 36 40 41 47 38

VentureSource

LIQUIDITY

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Top 3 M&As in Europe (2Q 2014)

Company Name

Location Brief Description Industry Code Industry Segment

Industry Group

Close Date

Round Type

Amount Paid (€M)

Acquirer

Crossknowledge Group Ltd.

Suresnes, France

Provider of corporate e-learning services.

Educational/Training Media and Services

Media and Content Consumer Services

28/4/2014 Acquisition €126.86 John Wiley &

Sons

eNovance SAS Paris, France

Provider of high-end hosting and managed services focused on

open source and open cloud technologies.

IT Consulting Business Support

Services

Business and Financial Services

30/6/2014 Acquisition €70.00 Red Hat Inc.

Lab21 Ltd. Cambridge,

United Kingdom

Provider of personalized medicine and clinical diagnostics products and services.

Medical Lab Instruments/Test

Kits

Medical Devices and Equipment

Healthcare 5/6/2014 Acquisition €40.00 Novacyt SAS

VentureSource

LIQUIDITY

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European VC-backed IPO Activity

(2011 - 2014)

European VC-backed IPOs (2011-2014)

19 IPOs were completed during 2Q 2014, outnumbering those in both the previous quarter and 2Q 2013 and

the highest number of venture-backed IPOs in a quarter since 4Q 2006 when 34 were completed.

IPOs raised €407 million during 2Q 2014, a fall of 9% from 1Q 2014. A total of €855 million has been raised

during the first half of 2014, more than eight times the figure for the equivalent period in 2013 and the highest

amount since €862 million were raised in IPOs during the first half of 2006.

The largest European VC-backed IPO of 2Q 2014 was JUST EAT PLC’s April listing on the London Stock

Exchange. The company raised a total of €121 million, which represents 30% of the total amount raised

through European venture-backed company IPOs for the quarter.

2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14

Raised (€M) through IPO € 355.76 € 65.15 € 18.66 € 157.40 € 26.76 € 52.08 € 142.99 € 19.22 € 71.56 € 25.51 € 378.13 € 448.63 € 406.50

Number of IPOs 7 3 2 6 3 2 5 1 4 3 9 8 19

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LIQUIDITY

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Company Name

Country Brief Description Industry Code Industry Segment

Industry Group

Close Date Raised

through IPO (€M)

Exchange/ Symbol

JUST EAT PLC United

Kingdom Provider of an online

takeaway ordering service. Restaurants/Food

Service Travel and Leisure

Consumer Services

3/4/2014 €120.57 LSE: JE

SuperSonic Imagine SA

France

Provider of ultrasound medical imaging systems

for measuring and visualizing tissue elasticity.

Diagnostic Imaging Equipment

Medical Devices and Equipment

Healthcare 10/4/2014 €50.00 PAR: SSI

Fermentalg SA France

Developer of a method to transform microalgae into chemical compounds for the agrifood, healthcare,

and energy markets.

Biofuels/Biomass Renewable Energy Energy and

Utilities 16/4/2014 €40.37 PAR: FALG

Top 3 IPOs in Europe (2Q 2014)

VentureSource

ABOUT US

Dow Jones VentureSource helps venture capitalists, corporate development executives, investment bankers, and service providers find deal and partnership opportunities, perform comprehensive due diligence, and examine trends in venture capital investment, fund-raising and liquidity. It provides accurate, comprehensive data on venture-backed companies – including their investors and executives – in every region, industry and stage of development throughout the world. The investment figures included in this release are based on aggregate findings of Dow Jones' proprietary research and are contained in VentureSource. This data was collected through surveys of professional firms, interviews with company executives, and from secondary sources. These venture capital statistics cover equity investments into early stage, innovative companies and do not include companies receiving funding solely from corporate, individual, and/or government investors. Figures contained throughout the report current at time of editorial but are subject to change without notice. No statement herein is to be construed as a recommendation to buy or sell securities or to provide investment advice.

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