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An overview of the VC market and Vækstfonden. 12 March 2010 Uffe Arlø Theilade, Investment Director, Vækstfonden. Agenda. The idea and rationale for VC An introduction to Vækstfonden VC in Denmark Market developments and challenges. Why do we need venture capital?.

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An overview of the vc market and v kstfonden

An overview of the VC market and Vækstfonden

12 March 2010

Uffe Arlø Theilade, Investment Director, Vækstfonden


Agenda
Agenda

  • The idea and rationale for VC

  • An introduction to Vækstfonden

  • VC in Denmark

  • Market developments and challenges



Types of finance (risk profiles)

Traditional companies

Technology companies

Debt

Quasi-equity

Equity

Debt

Equity


VC Funded Companies in Denmark

  • 20% growth in employment

  • 40% export growth

  • 50% growth in R&D

  • R&D expected to account for 1.5% of GDP in 2010


VC-backed companies in the US

  • $ 1,800 billion revenue

  • 16% of GDP

  • 10 mil jobs

  • 40% of all IPOs

  • 3 x R&D activity

  • 3 x tax payment

  • 2 x export




Who we are
Who We Are

  • Vækstfonden is a government backed investment fund

  • Investment focus on Danish early stage companies - both through direct investments and fund-of-funds

  • Total asset base around EUR 350 million

  • 85 % committed to early stage companies and venture capital funds

  • Largest Danish investor within the ICT and life science spaces


Funding activity
Funding Activity

  • Annual investments of DKK 500 million in 25-30 companies – direct as well as through VC funds

  • Loan guarantees on the rise

  • Co-funded more than 3,500 companies to the tune of DKK 6.5 billion


Targeted financing
Targeted Financing

Funding Need

Million Euro

Fund of Funds

Growth Capital

Business Angel Matching

Loan Guarantees

Global Growth

Companies

15

International

Growth Companies

5

Regional Growth

Companies

1

Local Growth

Companies

Potential Revenue

Million Euro

5

15

70+


Vækstfonden’s leverage effect

Vækstvirksomheder - 50 mia. kr.

10 mia. kr.

40 mia. kr.

Private

ventureselskaber

Andre private finansieringskilder

6 mia. kr.

4 mia. kr.

Private investorer

Vækstfonden



Main attractors in the danish market
Main Attractors in the Danish Market

  • Strong Research Base

  • Entrepreneurial Culture

  • Flexible Labour Market

  • Dynamic Technology Clusters


0,25%

0,20%

0,15%

0,10%

0,05%

0,00%

DK

S

FIN

UK

IRL

NL

NO

CH

E

B

F

P

D

A

I

EL

Nationale investorer

Udenlandske investorer

VC-backed companies’ attraction of foreign capital (relative to GDP; 2007)



Geographic Distribution of VC Investment

  • Large concentration around Greater Copenhagen

  • Generally centered around universities and research institutes


Top 3 industries in denmark
Top 3 Industries in Denmark

% of Total Amount Invested




Annual capital raisings by vc funds
Annual Capital Raisings By VC Funds activity

€ Million

Total Capital Under Management

DK: € 2,983 Million



Due to follow on investments
..Due to Follow-On Investments activity

New Investments Under Pressure




The global financial crisis puts exit markets in reverse
The Global Financial activityCrisis Puts Exit Markets in Reverse

Source: VentureXpert

13. november 2014

26


Ipo valuations particularly hard hit
IPO Valuations Particularly Hard Hit activity

Source: VentureXpert

13. november 2014

27


Entry valuations falling
Entry Valuations Falling activity

Source: VentureXpert

13. november 2014

28


Holding periods rising steadily
Holding Periods Rising Steadily activity

Source: VentureXpert and Vækstfonden

13. november 2014

29


Key points
Key Points activity

  • Raising money for new ventures increasingly difficult

  • New venture capital funds need to be raised

  • Danish VCs under pressure to deliver attractive exits

  • Exit timing is crucial

30


Learn more at www vf dk
Learn More At activitywww.vf.dk


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