slide1 n.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Investing in risk capital funds – The role of a government supported fund-of-funds and the mission to promote econo PowerPoint Presentation
Download Presentation
Investing in risk capital funds – The role of a government supported fund-of-funds and the mission to promote econo

Loading in 2 Seconds...

play fullscreen
1 / 29

Investing in risk capital funds – The role of a government supported fund-of-funds and the mission to promote econo - PowerPoint PPT Presentation


  • 74 Views
  • Uploaded on

Investing in risk capital funds – The role of a government supported fund-of-funds and the mission to promote economic growth. Baltic M&A and Private Equity Forum Riga , 25 October 2013 Jouni Hakala, Chairman of EFVIN. Content.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Investing in risk capital funds – The role of a government supported fund-of-funds and the mission to promote econo' - nikita


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
slide1

Investing in risk capital funds – The role of a government supported fund-of-funds and the mission to promote economic growth

Baltic M&A and PrivateEquity Forum

Riga, 25 October 2013

Jouni Hakala, Chairman of EFVIN

evaluating the contribution of private equity to economic growth
Evaluating the contribution of private equity to economic growth*
  • Relevant dimensions of private equity activity:

*Source: Exploring the impact of private equity on economic growth in Europe,A report prepared for the EVCA by frontier economics, May 2013.

evaluating the contribution of private equity to economic growth1
Evaluating the contribution of private equity to economic growth*

Innovation, productivity, competitiveness

  • Private equity attracts investible funds into Europe providing much needed risk capital for businesses. In the 12 largest private equity markets in Europe, private equity invested almost €250 billion in more than 19,400 companies between 2007 and 2012. Of this, an estimated €50 billion was raised from outside Europe.
  • Private equity builds businesses that are more innovative than non private equity-backed firms. Patents granted to private equity-backed businesses between 2006 and 2011 are likely to be worth up to €350 billion. Private equity participation increases the number of patent citations by 25%. With increased numbers of citations corresponding to greater economic value, this suggests it uses resources more effectively to deliver higher returns on investment. In some sectors, private equity finance can be up to nine times more effective than non-private equity financing.
  • Private equity boosts productivity by improving management, operational expertise and production processes. Private equity backing also leads to improved productivity (measured by EBITDA (earnings before interest tax, depreciation and amortisation) per employee) of 6.9% in large private equity backed companies over a six year period.
  • Private equity contributes to the creation of up to 5,600 new businesses in Europe annually. Venture capital investment directly leads to the creation of 2,800 new companies across Europe each year. In addition, a ‘spill-over’effect - caused by knowledge sharing, networking and inspiring role models- leads would-be entrepreneurs to create approximately 2,800 more businesses each year.

*Source: Exploring the impact of private equity on economic growth in Europe,A report prepared for the EVCA by frontier economics, May 2013.

net sales in finnish portfolio companies
Net sales in Finnish portfolio companies

Statistics Finland: Net sales of Finnish limited companies grew on average approx. 5.4% in 2011 compared to 2010.

j ob creation in finnish portfolio companies
Job creation in Finnish portfolio companies

Statistics Finland: the number of jobs in Finnish limited companies grew on average approx. 1.4% in 2011 compared to 2010.

venture funds have raised 22bn during last 5 years importance of government agencies is high
Venture funds have raised €22bn during last 5 years; importance of government agencies is high
  • The share of Public actors’ capital in VC-fundshasbeenincreasingin Europe

Source: EVCA

european venture capital market
European venture capital market
  • Finland’s private equity and venture capital market is fairly developed, since the supply of venture capital funding is in relation to GNP at a good level internationally

Source: EVCA

average venture returns have been disappointing in europe and in the us for the last 10 years
AverageVenturereturnshavebeendisappointing in Europe (and in the US…) for the last 10 years

Note: Five-yearrollingIRRs

Note: Five-yearrollingIRRs

Source: EVCA

slide13

AboutEVFIN

  • Set up in March 2011 in response to the continuing funding crisis affecting the VC industry across Europe
  • A platform for dialogue gathering 10 major national VC operators (€24 bn under management) representing 8 European countries
  • Mostly public Fund of Funds, they all foster equity financing for SMEs through supporting best VC funds and contribute to develop domestic VC markets
  • Members: Caixa Capital (Portugal); Capital Dynamics (UK); Capital for Enterprise (UK); Bpifrance (France); Enterprise Ireland (Ireland); Finnish Industry Investment (Finland); KFK/BGK (Poland); PMV (Belgium); SRIW (Belgium) ; TANEO (Greece).

13

slide14

EVFIN Objectives

  • Share best practices among EU LPs & develop a common understanding of the EU VC market
  • Encourage pan-EU joint initiatives to address the VC crisis
  • Act as a partner to the European Institutions by providing input regarding projects and policies related to SMEs financing
  • Offer opportunity for a constructive dialogue between all stakeholders of the EU VC industry (EIB Group, EVCA, Gps etc.)
  • EVFIN initiative has developed from the conclusions of the EU Council meeting of February 2011 which called on the EU Commission to present proposals for putting in place a EU VC scheme building on EIF and national operators

14

economic and societal impact
Economic and societal impact

Investments worth

€516m

in funds that have

total capital of €8,4b

Investments total

€720m

40 000 employees in portfolio companies

Government’s

€470m investmentshave grown into

€575m

Investment in

FoF Growth €54m

Total capital of

FoF Growth €135m

Investor directly or through funds in 510 companies

Portfolio companies generate

€7,5b in revenue

investment stage
Investmentstage

€m

15

  • Fundinvestments
  • Early-stage
  • Growth
  • Buyout
  • FoFGrowth

10

Direct

investments

Buyout

5

Direct investments

Venture capital

(StartFund I Ky)

1

SeedStart-upEarlygrowth Expansion

fof growth
FoFGrowth
  • Establishedby FII (40%) and Finnishpensionfunds (60%) in 2009, totalcapital 135M€
  • Investmentfocus on venture and growthfunds
  • To date: Commitments 110 million > 10 funds > 52 companies > 4300 employees > 475M€ in revenue
  • Impact on fundraising:

730M€

12,5x

investing in growth

Investing in Growth

www.industryinvestment.com