The Case for Investing in European Venture Capital

EUROPEAN VENTURE CAPITAL SMART CHOICE: THE CASE FOR INVESTING IN EUROPEAN VENTURE CAPITAL European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Contents WHAT’S INSIDE THIS REPORT? 02

Foreword Section One: Section Two: Europe: a compelling The European European investment story VC ecosystem entrepreneurs are By Dörte Höppner, 1 2 Secretary-General, EVCA has come of age building world- Page 03 Pages 04-08 leading companies Pages 09-16

To find out more about the Section Three: Section Four: European Private Equity and Venture Capital Association please visit: Europe’s venture Venture capital www.evca.eu capitalists are now boosts economic 3 highly experienced 4 growth Pages 17-26 Pages 27-29

Note to terminal server users: This report requires system compatiblity for playing embedded video in PDF. Note to tablet users: To view all the content in this report on your tablet please use a video-playing pdf reader from your app store. (We recommend ‘ezPDF Reader’ for iPad and Android). European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Foreword FOREWORD BY 03 DÖRTE HÖPPNER

It is with pleasure that we at the European Private Equity and Venture Capital Association are able to present our report, Smart choice: The case for investing in European venture capital. If you thought you knew European venture capital, it’s time to look again. The combination of highly motivated entrepreneurs and experienced venture capital fund managers with the right skills to commercialise innovation on a global scale now make European venture capital a compelling investment Dörte Höppner story that investors should not miss. Secretary-General, EVCA The report explains why: it contains downloadable facts, figures and charts, together with interactive maps and videos. In it, we present the overall case first, explaining why the European venture capital ecosystem has truly come of age; we then explore how the region has become a hotbed of entrepreneurial activity; the following section examines how Europe’s venture capitalist fund managers are now equipped with all the right skills and conditions for generating out-sized returns and the last section takes a look at the substantial economic benefits venture capital is bringing Europe.

PRIVATE EQUITY: THE CASE FOR EUROPE European venture capital really is the smart choice for investment. We hope you’ll agree after reading this report. WATCH THE SUMMARY FILM HERE> WATCH THE FULL FILM HERE > European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 1: European VC ecosystem comes of age SECTION 1: 04 THE EUROPEAN VC ECOSYSTEM HAS COME OF AGE European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 1: European VC ecosystem comes of age LOOK AGAIN AT EUROPEAN VENTURE CAPITAL 05

It’s time to look again at European venture capital managers have built on previous successes, such as Skype and Cambridge Silicon Radio, and are able to The ecosystem has also become richer The European venture capital ecosystem has come grow world-leading companies consistently. They are in two new ways: of age. It’s a bold statement, but one rooted in the now highly experienced and have the skills, ambition reality on the ground. The headlines may tell the and contacts necessary to commercialise disruptive world that Europe is struggling as the Eurozone crisis 1. The emergence of technologies and innovations to create successful p06 continues, but the truth is that Europe’s start-ups ‘super angels’ has significantly companies on a global stage. In addition, scarcity and the infrastructure supporting them have never improved seed finance. of capital in Europe means that these high quality been better. And... growth opportunities can not only be accessed at low Over the last few years, Europe has generated a valuations by global standards, but also that Europe’s 2. Corporate venturing wealth of success stories – world-leading companies entrepreneurs are achieving key milestones with a programmes now provide p07 that have generated stellar returns for many of fraction of the capital needed by their US peers. smart capital. Europe’s venture capital funds and their investors. Hubs and clusters have developed across Europe Europe is home to world-class entrepreneurs and from Dublin, London and Cambridge through to venture capitalists Berlin, Paris, and Helsinki, featuring exciting new As we will prove throughout this report, these start-ups, major global corporations and top class success stories are not the result of mere luck. academic institutions, all combined with sources of Europe’s entrepreneurs and venture capital fund smart capital.

COMPANY RETURNS AND EXITS: ACROSS EUROPE

VIEW THE EXITS AND RETURNS MAPS HERE > European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 1: European VC ecosystem comes of age LOOK AGAIN AT EUROPEAN VENTURE CAPITAL 05

COMPANY RETURNS AND EXITS:

DENMARK SWEDEN COMPANY RETURNS AND EXITS: 5-10X GERMANY It’s time to look again at EuropeanTHE NETHERLANDS ventureNORWAY capital have built on previous successes, such as Vodafone, $1BN+ Skype and Cambridge Silicon Radio,THE NETHERLANDSand are able to The ecosystem has also become richer The European venture capital ecosystem has come grow world-leadingSWEDEN companies consistently. They are in two new ways: of age. It’s a bold statement, but one rooted in the now highly experienced and have the skills, ambition reality on the ground. The headlines may tell the UK and contacts necessary to commercialiseUK disruptive world that Europe is struggling as the Eurozone crisis 1. The Emergence of technologies and innovations to create successful p06 continues, but the truth is that Europe’s start-ups ‘Super angels’ has significantly AUSTRIA companies on a global stage. In addition, scarcity and the infrastructure supporting them have never RUSSIA improved seed finance. of capital in Europe means that thesePORTUGAL high quality FRANCE SWITZERLAND been better. And... growth opportunities can not only be accessed at low Over the last few years, Europe has generated a FRANCE SWITZERLAND GERMANYvaluations by global standards, but also that Europe’s 2. Corporate venturing wealth of success stories – world-leading companies entrepreneurs are achieving key milestones with a programmes now provide p07 that have generated stellar returns for many of fraction of the capital needed by their US peers. smart capital. Europe’s venture capital funds and their investors. Hubs and clusters have developed across Europe Europe is home to world-class entrepreneurs and from Dublin, London and Cambridge through to COMPANY RETURNS venture capitalists ANDBerlin, EXITS: Paris, and Helsinki, featuring exciting new start-ups, major global corporations and top class HIDE ALL As we will prove throughout this report, these success THE NETHERLANDS NORWAY FINLAND GERMANY MAPS stories are not the result of mere luck. Europe’s >10Xacademic institutions, all combined with sources of entrepreneurs and venture capital fund managers smart capital.

COMPANY RETURNS AND EXITS: AUSTRIA ACROSS EUROPE

VIEW THE EXITS AND RETURNS MAPS SPAIN FRANCE ITALY HERE > European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 1: European VC ecosystem comes of age THE EMERGENCE OF ‘SUPER ANGELS’ HAS 06 SIGNIFICANTLY IMPROVED SEED FINANCE...

Super Angels Figure 1. Examples of European ‘super angel’ funds Just as in the US, many of Europe’s most successful entrepreneurs have now established ‘super angel’ funds and highly ambitious entrepreneur-led venture capital funds, using their capital, insight and contacts. These are just a few examples, and there are many Seedcamp Set up in 2007 by Startupbootcamp Provides Notion Capital Created by more, of how Europe’s VC ecosystem has developed Index Ventures partner Saul seed funding, mentoring MessageLabs founders Jos over the space of a few years. By providing seed Klein and Reshma Sohoni, and free co-working space, and Ben White. formerly of 3i, Vodafone and software and services. stage finance and mentoring, these super angels are eVentures India. An early-stage improving the quality and quantity of deal flow for mentoring and investment European VCs. fund, it is backed by an almost equal mix of 27 angel investors and venture capitalists.

We now have a liquid seed-stage funding structure in Europe. We didn’t have this before and so now the first €1m roadblock for Venture Cup Runs the largest HackFwd A pre-seed Atomico Created in 2006 entrepreneurs has been removed. business plan competition in investment company by Niklas Zennström (Skype, the world and has so far helped established by XING founder Kazaa) and has invested in 40 Hendrik Brandis Partner, Earlybird create over 80 start-ups. Lars Hinrichs. companies. European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 1: European VC ecosystem comes of age And corporate venturing programmes 07 now provide smart capital

Corporate venturing programmes says project leader, Matthias Ummenhofer, the EIF’s head of venture capital. “They want to be part of the Alongside the development of seed funding from ecosystem so they can stay ahead of competitors. seasoned VCs and entrepreneurs, the region is now They are looking for innovation and disruptive attracting serious interest from a new breed of technologies and they clearly see them in Europe.” corporate venturers, providing valuable contacts, expertise and potential exit routes for Europe’s US corporates are providing valuable exit routes brightest prospects. US corporates are now sitting on over US$3 trillion “Corporate venture teams are now staffed with of cash reserves, over half of which is held overseas, experienced teams that understand the collaborative according to estimates by Morgan Stanley. Over Corporates believe that access to role they can play with venture capitalists in building US$1 trillion of this is accounted for by technology European start-ups is a ‘must-have’ to great companies,” says Uli Fricke, general partner at companies. These businesses are looking to Europe’s Triangle Venture Capital Group. venture capital-backed companies for acquisitions. be part of the ecosystem so they can stay ahead of competitors. Such is the level of interest among corporates “There is a huge war chest of cash looking for for access to Europe’s innovators, the European acquisitions around the globe,” says Anne Glover, chief Matthias Ummenhofer Head of venture Investment Fund is currently establishing an executive of Amadeus Capital. “The exits are there capital, European Investment Fund investment programme dedicated to corporate for VCs that are able to create valuable companies.” investors, the Corporate Innovation Platform. Indeed, US acquirers accounted for 43% of the value On its list of interested investors are 50 major of M&A in Europe in the first six months of 2012, corporations from around the world. “Corporates according to Dealogic figures. believe that access to European start-ups is no longer a ‘nice to have’; it is a ‘must-have’,” European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 1: European VC ecosystem comes of age ALL THE INGREDIENTS FOR 08 SUCCESS, BAR ONE...

Despite the development of this vibrant ecosystem, “Spotify alone is worth between 1x and 3x the there is one element still lacking: sufficient private entire fund of its early-stage investors, Creandum; capital. While a scarcity of funding keeps start- Wonga could well be valued at $10bn; and Shazam up valuations low, it creates a problem in getting is a stellar performer. Rovio and Supercell in Finland companies onto a truly global stage. are also hitting the billion dollar valuation point. This highlights the serious value creation going New investors required on in Europe.” The effects of the the crisis and regulatory change, At a time of low global growth and low interest rates, mean that Europe’s venture capital funds need to find there are few opportunities that can generate double- new investors so they can raise funds of sufficient digit returns. The capital needs and high potential scale to help Europe’s best companies grow to their We invest in European venture capital, of European venture capital present one such full potential – generating substantial returns for not because we have a romantic view opportunity. But don’t just take our word for it. investors in the process. of life... but because we believe that “We invest in European venture capital not because Value creation in Europe the best European venture capital we have a romantic view of life,” says Roger funds will produce good returns. “If you look closely at the numbers in today’s Johanson, head of venture capital and infrastructure portfolios of the top European VCs that are leading investments at Skandia Life Insurance Company, the market, you’ll see that the teams able to raise a long-standing investor in European venture Roger Johanson Head of venture funds today stack up against the top quartile US capital. “We invest because we believe that the best capital and infrastructure investments, Skandia Life Insurance Company managers,” says Nenad Marovac, founder and European venture funds will come back with good managing partner at DN Capital. returns for us.” European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 2: Building world-leading companies SECTION 2: 09 EUROPEAN ENTREPRENEURS ARE BUILDING WORLD-LEADING COMPANIES European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 2: Building world-leading companies A LONG HISTORY OF INNOVATION 10

Europe’s capacity for innovation has never been few years, leading to the creation of world-leading Figure 2. The Global Innovation Index [2012-2013] [Source: INSEAD and WIPO] in doubt. It is home to many of the world’s leading companies and brands at an unprecedented pace. In companies - Siemens, Vodafone, Sanofi-Aventis, the space of a few years, companies such as Skype,

RANK ECONOMY SAP, GlaxoSmithKline, Nestlé and Royal Dutch MySQL, Last.fm and Betfair have revolutionised their Shell to name but a few. In fact, seven of world’s ten respective markets on a global scale, generating 1 SWITZERLAND most innovative markets are in Europe, according stellar returns for investors in the process. And they to the 2012 Global Innovation Index, and these all are far from alone. European venture capital fund SWEDEN 2 appear above the US. portfolios are full of new and upcoming world-leaders in their field. Wonga was identified as Europe’s 3 SINGAPORE “Core innovation and technological development in fastest-growing business in 2011, Spotify named Europe have always been world-class, underpinned as a Technology Pioneer by the World Economic 4 FINLAND by continued government investment in research Forum for 2011 and Biocardis was awarded the and science projects as well as high quality academic same status in 2012. 5 UNITED KINGDOM institutions,” says Anne Glover, chief executive of Amadeus Capital. So why is this happening? And why now? 6 NETHERLANDS Yet the speed of innovation and – crucially – the Over the next six pages we outline some of the 7 DENMARK ability of Europe’s entrepreneurs to commercialise reasons why the European VC industry is so adept their ideas has increased markedly over the last at investing in innovation... 8 HONG KONG

9 IRELAND

10 UNITED STATES Core innovation and technological development in Europe have always been world-class, underpinned by continued government investment in research and science projects as well as high quality academic institutions.

Anne Glover CEO, Amadeus Capital European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 2: Building world-leading companies EUROPE’S ENTREPRENEURIAL 11 TALENT POOL HAS DEEPENED

Entrepreneurial talent takes time to develop. The Kazaa among other businesses as well as investment technology boom of the early 2000s may have group Atomico. In France, entrepreneurs turned angels ended in bust for many investors, but it spawned a include Xavier Niel and Jeremie Berrebi, founders of new breed of ambitious entrepreneurs. While many Kima Ventures, but also Marc Simoncini, Jean-Antoine may have failed in their early ventures, they have Granjon and Jean-David Chamborédon. In Germany, learned valuable lessons along the way. there is Lars Hinrichs (HackFwd) and the Samwer brothers and in Finland: Kaj Hed (Rovio). Experience and determination Repeating success Those that have remained determined to start up again have done so armed with previous experience. This development is reflected in VC fund portfolios. “The bubble and bust of the early 2000s was In Earlybird’s 1998 fund, just 7% of its companies In our latest fund, we’ve one of the most effective entrepreneur education were run by repeat entrepreneurs; in its 2007 fund, programmes ever,” says Hendrik Brandis, partner that figure was nearly 60%. “In our latest fund, we’ve made three investments. at Earlybird. “Only a minority were successful, but made three investments,” says Brandis. “All three All three are managed by everyone emerged more skilled.” are managed by repeat entrepreneurs.” Amadeus Capital tells the same story. Its 1998 fund had 15% of Building on success repeat entrepreneurs. companies managed by serial entrepreneurs, while its Hendrik Brandis Partner, Earlybird There is also a growing band of previously successful latest fund has over 70%. entrepreneurs that have formed further new This is important: research by leading Harvard businesses, such as Marco Börries, founder of a series academic Josh Lerner has found that entrepreneurs of of companies under the Star brand and now founder successful businesses are almost twice as likely to be of NumberFour, Lastminute.com founder Brent successful in a new venture as first-timers. Hoberman, who has established another business in addition to being an angel investor and Niklas Zenström and Janus Friis, founders of Skype and European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 2: Building world-leading companies ENTREPRENEURIAL BUSINESSES 12 NOW ATTRACT TOP TALENT

As a raft of success stories have emerged from Europe over the last decade, entrepreneurial businesses have become highly attractive to a broader range of professionals and experts. New career options Once, many managers and executives in large corporates may have considered start-ups as too risky a career path. Yet the erosion of the idea of a job for life that was prevalent in Europe until the late 1990s, together with the promise of being able to influence the direction of a rapidly-growing business, have drawn Great executives from large out highly talented people from large companies, often with the kind of international experience and contacts corporations are now joining younger entrepreneurs lack. This is adding to the overall talent pool for entrepreneurial businesses. “The floodgates have start-ups. The pool of talent opened,” says Christian Reitberger, general partner at Wellington Partners. “Great executives from large in Europe has expanded in corporations are now joining start-ups. The pool of talent in Europe has expanded in quantity, but also in quality.” quantity, but also in quality.

Christian Reitberger General partner, Wellington Partners European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 2: Building world-leading companies HUBS ARE CREATING NEW 13 OPPORTUNITIES

The creation and development of hubs around Figure 3. Europe’s cities has transformed the prospects for MAJOR EUROPEAN many of the region’s start-ups. 6 INVESTMENT HUBS They are attracting the brightest talent from around

Europe – and further afield – as entrepreneurs, 12 funders, universities and technology giants find the opportunity to collaborate, share ideas and experiences and pass on valuable contacts. 4 Down to earth VIEW ALL In addition to these hubs is a programme run by the 7 DETAILS European Space Agency across a European network 11 3 aimed at transferring the region’s considerable space 8 technology into terrestrial applications. So far, it has 5 2 helped create more than 70 companies. 10 9

MAJOR EUROPEAN INVESTMENT HUBS

1 1 Barcelona 6 Helsinki 11 Silicon Fen

2 Belgium 7 Ireland 12 Stockholm

3 Berlin 8 London 13 Switzerland

4 Denmark 9 Paris

5 Eindhoven 10 Rhein-Main-Neckar European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 2: Building world-leading companies HUBS ARE CREATING NEW 13

OPPORTUNITIES DENMARK BERLIN STOCKHOLM Focus: Life sciences and cleantech Academic institutions: 285 start-ups Academic institutions: Focus: Academic institutions: University of Copenhagen, Freie Universität Berlin, Telecoms, peer to peer, software Royal Institute of Technology, Also home to: Symbion Focus: Digital media, social games, Technical University of Denmark Humboldt University of Berlin, Stockholm University consumer web services Technical University of Berlin Birthplace of: Big names include: Also home to: Tech Open Air Birthplace of: Big names include: Birthplace of: Big names include:

The creation and development of hubs around Figure 3. Europe’s cities has transformed the prospects for MAJOR EUROPEAN many of the region’s start-ups. 6 HELSINKI

SILICON FEN INVESTMENT HUBS Focus: Mobile telecoms, Academic institutions: gaming, open source Aalto University, University of Helsinki They are attracting the brightest talent from1,000 around high tech companies Academic institutions: Cambridge University Birthplace of: Big names include: Focus: Semiconductors, wireless, data and biotech Also home to: Europe – and further afield – as entrepreneurs, Cambridge Angels 12 funders, universities and technology giants Birthplacefind of: Big names include: the opportunity to collaborate, share ideas and ZOOM experiences and pass on valuable contacts. 4 TO READ BOXES Down to earth EINDHOVEN

IRELAND 100 local and Focus: Green sustainable international companies technologies, software In addition to these hubs is a programme runFocus: by Hardware, the Medtech Academic institutions: HIDE ALL Academic institutions: Trinity College, University College 7 Eindhoven University of Technology Dublin, University College Cork DETAILS European Space Agency across a European network Birthplace of: Big names include: Birthplace of: Big names include: 11 3 aimed at transferring the region’s considerable space 8 technology into terrestrial applications. So far, it has 5 2 helped create more than 70 companies. 10 9 RHEIN-MAIN-NECKAR TECH CITY, LONDON 5,000 software companies Academic institutions: Technical University of Darmstadt, Johann 800 technical and creative Academic Partners: Imperial College Focus: IT Wolfgang Goethe University of businesses London, Loughborough University 13 Also home to: Frankfurt am Main, University of Focus: Consumer web services, Also home to: European Space Operations Center Mannheim, University of Heidelberg digital media, e-commerce Seedcamp and finance Birthplace of: Big names include: Birthplace of: Big names include: MAJOR EUROPEAN INVESTMENT HUBS

1 1 Barcelona 6 Helsinki 11 Silicon Fen

2 Belgium 7 Ireland 12 Stockholm BARCELONA PARIS BELGIUM SWITZERLAND

160 high tech companies Academic institutions: ESADE, IESE, 700 start-ups Academic institutions: Universities Focus: Life sciences Academic institutions: Université 880 medtech companies Academic institutions: University of (established in the technological Universitat Politècnica de Catalunya of Paris VI and Paris VIII, Institute de Catholique de Louvain, Katholiek Basel, University of Berne, University Focus: Media, advertising, Focus: Medtech and 3 Berlin 8 London 13 Switzerland district 22@) Recherché et d’Innovation Universiteit Leuven of Zurich Also home to: e-commerce, wireless pharma/life sciences Focus: Mobile telecoms, Mobile World Capital Also home to: LeWeb, Le Camping e-commerce, gaming, software Birthplace of: Big names include: Birthplace of: Big names include: 4 Denmark 9 Paris Birthplace of: Big names include: Birthplace of: Big names include:

Venture capital remains scarce in Europe (see next There is a definite contrast with the US here.European section for further information) and bank finance entrepreneurs are much more willing and able to achieve is a pressing concern for around a fifth of small and medium-sized businesses in Europe, according to a growth on a shoestring. That’s great because they are able to recent European Central Bank study, with the same use less capital in a highly effective way. proportion suggesting that the availability of this Karsten Langer Partner, The Riverside Company type of finance had deteriorated in the six months to March 2012. Limited capital This scarcity of capital means that only the very best companies get funding. It also means that early and later-stage companies are funded at half or even a third of the valuations of their US counterparts, according to Anne Glover. While more capital is certainly needed to fund these stars of tomorrow, the more positive outcome is that Europe’s start-ups are highly capital efficient: they require far lower levels of funding to achieve scale than similar US businesses. “The lack of capital forces entrepreneurs here to figure out how to be more frugal,” says Anne Glover. “One of our portfolio companies has achieved more than its only competitor in San Diego on half the capital.” European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 2: Building world-leading companies EUROPE’S FAST-GROWTH COMPANIES 15 SPAN A RANGE OF SECTORS

While some areas, such as social Medtech Many of modern medicine’s most valuable innovations Figure 4. Venture deals in 2011 By sector media, might get all the headlines, [Source: EVCA/ PEREP_Analytics] have come from Europe: the original stents, then drug- Europe’s innovation and start-up release stents, a range of spinal treatment devices, activity spans a variety of sectors. such as spinal implants and the PET CT scanner. Such Key innovation continues – the difference now is that COMMUNICATIONS 17.6% COMPUTER & CONSUMER ELECTRONICS 17.8% Life Sciences European entrepreneurs and the VCs that back them ENERGY & ENVIRONMENT 11.4% know how to commercialise such technologies. LIFE SCIENCES 31.1% Europe is home to some of the world’s leading life OTHER* 22.1% sciences research. Building on this capability, there are Optos was listed on the London Stock Exchange in several clusters dedicated to the sector across Europe, 2006 at a value of $250m and continues to lead the including a new development in Sweden, Science City. world in retinal diagnostics. CoreValve, which was sold to Medtronic in 2009 is another example. The industry 17.6% As a result, Europe’s life sciences companies have all is boosted by US medical technology companies opting 22.1% the right ingredients to commercialise their discoveries to move to Europe, where the regulatory approval on a global scale, with many hoping to replicate the system is easier to navigate and the availability of success of BioVex, an oncology drug development skilled and experienced staff is high. This provides 17.8% company that was sold recently to Amgen for US$1bn. valuable new investment opportunities for Europe’s 31.1% But there are plenty more role models for Europe’s VCs. Mainstay, for example, moved to Dublin earlier 11.4% fledgling biotech businesses:Domantis was sold this year after receiving $20m in finance from a in 2006 to GlaxoSmithKline for nearly US$500m, European VC syndicate. Preglem was sold to Gideon Richter in 2010 for CHF 450m the same year that Shire acquired Movetis *OTHER MADE UP FROM: for US$566m, and in 2012, the DBV Technologies AGRICULTURE 0.2% CONSUMER GOODS & RETAIL 4.5% IPO on the NYSE Euronext Paris exchange was BUSINESS & INDUSTRIAL oversubscribed. PRODUCTS 3.8% CONSUMER SERVICES 3.3% BUSINESS & INDUSTRIAL FINANCIAL SERVICES 2.8% SERVICES 2.7% REAL ESTATE 0.3% CHEMICALS & MATERIALS 2.1% TRANSPORTATION 1.2% CONSTRUCTION 0.5% UNKNOWN 0.6% European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 2: Building world-leading companies EUROPE’S FAST-GROWTH COMPANIES 16 SPAN A RANGE OF SECTORS continued...

Cleantech ICT (communications, computer (energy & environment) and consumer electronics) Europe leads the world in the cleantech sector. Europe has become the home to a vast array This is driven by political ambition – the EU’s 2020 of digital media, mobile, software and hardware targets are for 20% lower greenhouse gas emissions start-ups. than 1990, with up to a 95% reduction by 2050, 20% The lower cost of scaling online businesses – the cost of energy from renewables and a 20% increase in of setting up a consumer internet company is now energy efficiency. a third of the cost in 2000 – together with the rapid This is providing an impetus for companies to develop adoption of new technologies means that a company new and more efficient technologies across all sectors like Shazam has gone from a standing start in 2003 and in an incredibly diverse range of applications from to now having 250 million users tagging 300 million renewable energy through to industrials, domestic songs a month. Meanwhile, Rovio, the company behind and distribution. This is supported by European multi- Angry Birds, sees 16 years of gameplay every hour. SHAZAM: nationals, such as BP, DSM, IKEA and Unilever, but Transmode, a network solutions provider, went global WORLD-LEADING MEDIA ENGAGEMENT also by the region’s VCs. Rapidly-growing portfolio in the space of five years and last year listed on the WATCH THE FILM companies in these areas include Kebony, which Nasdaq OMX at a valuation of US$230m. provides a sustainable alternative to hardwood, Enablon, which develops software to reduce energy consumption and renewable food packaging business Xylophane. European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists SECTION 3: 17 EUROPE’S VENTURE CAPITALISTS ARE NOW HIGHLY EXPERIENCED European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists EUROPE’S VENTURE CAPITAL INDUSTRY 18 HAS BECOME WORLD-CLASS

Having started in earnest in the 1990s, Europe’s inexperienced teams (as with the US during the same have honed their skills and professionalised their firms. venture capital industry is younger than its period) and the bust led to poor returns, the effects of They now share the attributes of leading US firms. decades’ old US counterpart, but it has caught up which are only just being worked through. “In the early days, we compared Europe’s VCs against fast in terms of experience and skill levels. Experience is driving success the best performing US firms,” explains Roger This is important. A recent BVCA-sponsored report by Johanson, head of venture capital and infrastructure London School of Economics academics Ulf Axelson However, as with the entrepreneurs that founded the investments at Skandia Life Insurance Company. and Milan Martinovic found that companies where more VC-backed start-ups, Europe’s venture capital industry “At that point in time, there was far more operational experienced entrepreneurs and VCs were involved had has matured over the last decade as fund managers experience in US teams than in Europe, where teams higher probabilities of exit in both the US and Europe. have learned often painful lessons along the way. The tended to consist of high quality technical people plus venture capitalists that have survived the last decade Technology-led growth financial people. This has changed over the last few have been through at least two cycles and understand years. European VCs now have many more people with The creation of the industry was accelerated by the challenges inherent in sourcing and building highly operational experience, but they also have successful the late 1990s tech and internet boom, leading to promising businesses into global leaders in good times entrepreneurs joining existing teams or establishing the establishment of hundreds of new firms across and bad. There are now far fewer venture capital their own funds. This has markedly increased the the continent as capital flowed in. The flood of LP firms than there were even in 1998 and many of those quality of teams in Europe – they now have the money, however, led to many funds being managed by counted in the chart below are no longer active. Only combination of skills apparent in the best US firms.” the best performing funds have survived. Many of these

Figure 5. The number of VCs has right sized 1998 - 2010 [Source: Earlybird]

2,500 2,316 European teams now have the 2,000 1,840 combination of skills apparent 1,411 1,481 1,500 1,271 1,172 1,123 1,111 1,018 in the best US firms. 1,000 880 893 770 750 Roger Johanson Skandia Life Insurance Company 500

0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists EUROPE’S VC FIRMS FACE 19 A FUNDING SHORTAGE…

The clear out of venture capital firms was Potential untapped inevitable and in many ways desirable. Overall fundraising figures have therefore fallen. Figure 6. New VC funds raised (excl capital gains) € Billion [Source: EVCA/ PEREP_Analytics] “The European venture capital industry is much Despite the enormous potential sitting in current stronger in 2012 than it was in 2000,” says John portfolios, Europe’s venture capitalists face a funding 10 Holloway, director at the European Investment Fund. shortage, with some areas particularly affected, such 8.2 “There has been a Darwinian evolution in Europe: as hardware and life sciences. 8 those teams that have been able to raise capital really “Capital supply for hardware-related businesses has 6.2 are the best.” 6 severely deteriorated over the last few quarters,” says 4.8 Potential overlooked Christian Reitberger, general partner at Wellington 4 3.4 Partners. Wellington Partners’ latest life sciences fund 3.2 But investors are overlooking the significant potential – its fourth – has taken two years to reach a first close that European VC has for delivering good returns. 2 at €70m. While it remains confident of overshooting Added to this is the fact that many of the industry’s its €120m final close target, so much time on the road longer term investors, such as the banks and insurance 0 is an unhelpful distraction from sourcing and building 2007 2008 2009 2010 2011 companies face increasing regulation – most notably great companies. Basel III and Solvency II – which impedes their ability to invest in risk capital.

Capital supply for hardware-related There has been a Darwinian businesses has severely deteriorated evolution in Europe: those teams that have been able to raise capital over the last few quarters. really are the best.

Christian Reitberger General partner, Wellington Partners John Holloway Director, European Investment Fund European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists ...YET THEY HAVE A COMPELLING 20 STORY TO TELL INVESTORS

Faced with a reduction in their LP base, Europe’s seen a marked change – VCs are selecting businesses for this – particularly inexperience among VCs and venture capital firms now have to findnew investors more carefully and the businesses they have backed entrepreneurs in the early days,” says Uli Fricke, to support the continent’s fast-growth companies. have been much better than in the previous five years. managing general partner at Triangle Venture Capital Based on its current portfolio, the industry has a I am more optimistic about the returns potential from Group. “Those reasons are no longer there. We will great story to tell. European VC than I’ve ever been and I am convinced see a very different returns profile over the next few that in a few years’ time, European VCs will be in the years.” The issue is that, once the returns start coming Mutually aligned needs press for all the right reasons.” through, the best funds will be hard for new investors At a time of low global growth and low interest rates, to access as capital supply inevitably increases. Past performance is no longer an indication for what investors need new ways of delivering superior returns LPs should expect from European venture capital. “If investors simply look at historical performance, to their constituents. The need for more capital among Given that the environment has changed markedly they will miss out,” says Hendrik Brandis, partner Europe’s VCs closely matches LPs’ needs. “Where else and the ecosystem developed, what counts are at Earlybird. “If they leave it until the returns come are you going to get long-term, reliable growth based today’s portfolio companies and the skills VCs have through, it will be too late. Look at current portfolios on innovation in a stable political environment?” asks now compared to the past. Where success stories and the value they are generating – there is a Anne Glover, chief executive at Amadeus Capital. from Europe’s VC funds tended to be more sporadic tremendous opportunity here. There aren’t many “We have €2.5bn of gross commitments across in the past; there is now the volume necessary for opportunities right now that can offer the double-digit Europe,” says John Holloway. “We have seen where consistent good returns. “When looking back at returns that the best European venture portfolios VCs have been investing and since 2006, we have past results, investors need to look at the reasons are showing.”

If investors simply look at historical performance, they will miss out. There aren’t many opportunities right now that can offer the double- digit returns that the best European venture portfolios are showing.

Hendrik Brandis Partner, Earlybird European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists LACK OF COMPETITION HAS LED 21 TO REDUCED VALUATIONS

As we’ve seen, Europe is home to world-beating portfolios start being realised, generating significant Figure 7. Venture investment as % of GDP in 2011 [Source: EVCA/ PEREP_Analytics] young companies. Yet what distinguishes the returns, valuations will inevitably creep upwards. situation in Europe from many other parts of the 0.00% 0.01% 0.02% 0.03% 0.04% 0.05% 0.06% 0.07% “European VC is undercapitalised, not inexperienced,” world is capital scarcity. AUSTRIA 0.031 says Anne Glover. “If you want to build a global BELGIUM 0.024 In the US, there are currently 82 VC funds targeting business cheaply, this is a great place to do it. When DENMARK 0.052 an aggregate $13bn; in Europe there are just 27 funds returns really come through, prices will go up. For now, 0.044 FINLAND seeking a total of $2.3bn. Venture capital funding we need intelligent investors that don’t follow the herd FRANCE 0.032 GERMANY 0.027 as a percentage of GDP in Europe also lags the US and are prepared to look at unrealised portfolios to see GREECE 0.005 significantly. the potential.” 0.035 IRELAND Meanwhile, capital has also flowed to the newer “European valuations are more attractive than THE NETHERLANDS 0.031 SWITZERLAND 0.042 markets in Asia, such as China, where pre-money those in the US,” says Adam Saunte, vice president UNITED KINGDOM 0.045 valuations have soared. The situation in Europe in the investment team at private equity fund ISRAEL 0.022 couldn’t be more different. Valuations remain low by investor ATP PEP. “That, together with increasingly UNITED STATES 0.066 global standards, making European early and more experienced venture capital managers and later-stage companies some of the cheapest around entrepreneurs, leads us to believe that returns will be – a situation that won’t last forever. Once current better than we’ve seen in the past.”

Figure 8. Valuations by region US$ million [Source: Ernst & Young] Key USA CHINA* EUROPE 60.5 60 If you want to build a global business 50 46.3 42.8 cheaply, this is a great place to do it. 38.9 40 We need intelligent investors that 32.1 30 21.3 don’t follow the herd, prepared to 20.0 19.2 20 18.3 17.2 16.9 15.0 13.3 look at unrealised portfolios. 10.1 12.0 10 4.3 4.3 4.9 6.2 7.1 6.4 5.6 5.8 6.0 Anne Glover CEO, Amadeus Capital 0 2003 2004 2005 2006 2007 2008 2009 2010 2011

* Pre-2006 data not available for China European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists US VCs ARE ATTRACTED BY EUROPEAN 22 INVESTMENT POTENTIAL

Europe’s lack of capital, particularly at the later- A HUGE IMBALANCE BETWEEN SEED stage end is attracting the attention of US venture AND FOLLOW ON ROUNDS capitaists. Faced with intense competition and high valuations in their home market, many are now coming to Europe to source investments. Figure 9. Seed/Early versus Follow-On rounds Number, by region Key Between 2009 and 2011, the dollar amount of capital [Source: EVCA/PEREP_Analytics ; VentureSource] SEED/EARLY (Ø2 $M) FOLLOW ON (Ø12 $M) invested by US VCs in Europe’s start-ups increased by 165%, according to EVCA figures, with big names USA EUROPE such as Kleiner Perkins Caufield & Byers, Matrix 1,600 1,598 1,464 Partners, Sequoia Capital and Bessemer Venture 1,430

1,400 1,345 1,328 Partners providing primarily late-stage capital. 1,276 1,216 1,201 1,169 1,200 1,160 1,082 1,072

This can be a beneficial development for portfolio 1,069 1,038 1,020 988 959 companies, offering them further links with the US 1,000 952 938

market. However, if Europe’s venture capitalists had 829 more capital that enabled them to last the distance, 800 654 returns from these investments for LPs would 600 improve still further. 400 304 261 232 244 245 192 200 181

0 2003 2004 2005 2006 2007 2008 2009 2003 2004 2005 2006 2007 2008 2009 European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists EUROPE’S VCs ARE NOW CREATING 23 GLOBAL COMPANIES

Armed with the experience of bringing successful companies to a global market, Europe’s VCs now Compared to ten years ago, our have an international outlook. portfolio companies are able to Whereas the early stages of the industry saw many companies focus on the smaller prize of domestic reach an international stage much markets, today’s VC-backed companies have much more quickly. And we can support greater ambitions. This means that the current Eurozone crisis is far less relevant to these companies them with that in scaling revenues than might be expected. and opening up M&A routes. “Half of our portfolio companies sell in US$; over 70% of them sell globally,” says Anne Glover. “They are Uli Fricke Managing General Partner, Triangle Venture Capital Group not dependent on European GDP growth as these are companies that penetrate globally.”

ELECTRAWINDS: EUROPEAN START-UPS: GREEN ENERGY PRODUCTION & SOLUTIONS CREATING GLOBAL COMPANIES WATCH THE FILM VIEW THE MAP ON P24 > European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists EUROPE’S VCs ARE NOW CREATING 24 GLOBAL COMPANIES continued

Figure 10. European start-ups becoming global companies

THE EUROPEAN VENTURE CAPITAL ECOSYSTEM HAS ENABLED ITS START-UPS TO CONQUER THE WORLD...

VIEW ALL DETAILS European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists EUROPE’S VCs ARE NOW CREATING 24 GLOBAL COMPANIES continued

Figure 10. European start-ups becoming global companies 100m+ $20.99 retail price Downloads of Stardoll by Barbie ‘Angry Birds’ HQ: Sweden THE EUROPEAN VENTURE CAPITALHQ: Finland ECOSYSTEM HAS ENABLED ITS START-UPS TO CONQUER THE WORLD...

500k+ Fon hotspots. HQ: Spain

HIDE ALL DETAILS 84m+ tags per month Shazam for TV – Partnered with 50% of Superbowl advertisers. HQ: UK

2m+ app downloads Diamond Dash on mobile devices. featured in 14/19 app stores in Africa. HQ: Luxembourg HQ: Germany 50% of kids aged 6-12 have adopted a pet HQ: UK European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists EUROPEAN VCs ARE ACHIEVING NOTABLE 25 SUCCESSES EVEN IN A TOUGH EXIT MARKET

Achieving exits in today’s market is challenging. The Notable exit successes Figure 11. Number of realisations by European VCs number of realisations by European VCs fell in 2011 [Source: EVCA/ PEREP_Analytics] Among the most notable exits last year were the sale to 778, down from 929 in 2010 and 1,193 in 2007, 2011 of cancer vaccine developer BioVex to US-listed Amgen according to EVCA figures. for $1bn and network solutions provider Transmode’s 778 This reflects the difficult conditions on public markets IPO in Stockholm, building on successes in previous 2010 and caution among corporates about acquiring years, such as CoreValve’s sale to MedTronic and businesses – global M&A volumes in the years since MySQL’s sale to Sun Microsystems. More recently, the crisis have been subdued and Europe has been we’ve seen the sale of enterprise cloud start-up 929 far from immune from this trend. ThinkGrid to Colt Technology Services and hardware verification firm EVE’s sale to Synopsis. 2007 Yet even despite this, 2011 was one of the best years ever for exit valuations. European venture 1,193 capital-backed companies recorded the highest ever median sale price of €5.1m, according to Dow Jones VentureSource.

European portfolios are looking the best they ever have. We are sitting on a goldmine and looking for the right conditions to sell. When the conditions are right, investors will enjoy the fact that what we have now bears no comparison to what we had before 2006.

Hendrik Brandis Partner, Earlybird European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 3: Highly experienced European venture capitalists THE PROSPECTS FOR EUROPEAN VC 26 RETURNS HAVE NEVER BEEN BETTER

There is much more to come from European companies. They also now have global networks that We are seeing a lot of interest venture capital firms. they can bring to bear in a sales process. Over the last decade, they have established relationships with from companies in growth markets. “European portfolios are looking the best they ever corporates and corporate venturing teams across the That is providing us with new and have,” says Hendrik Brandis. “We are sitting on a world. As the exit examples above demonstrate, links goldmine and looking for the right conditions to sell. valuable potential exit routes. with US buyers are strong. When the conditions are right, investors will enjoy the Yet VCs are also building on the increased appetite Uli Fricke Managing General Partner, fact that what we have now bears no comparison to Triangle Venture Capital Group among emerging markets companies, many of which what we had before 2006.” are seeking out innovative technologies and processes “When companies are ripe for sale in a couple and strong brands. A recent report by PwC, for of years’ time, Europe’s VCs will be selling great example, showed that the number of M&A deals in companies that they have bought at low valuations,” Europe by Chinese companies breached the 100 mark says Holloway. “The returns that the industry has for the first time in 2011, almost doubling the number lacked historically will be there.” in each of the years 2008, 2009 and 2010. A substantial Should the IPO markets open up, Europe’s VCs will proportion of these were in the sub-€100m valuation be ready to seize the opportunity. The recent BVCA mark and total value reached €11bn in 2011. “We are report produced by LSE academics Axelson and seeing a lot of interest from companies in growth Martinovic found that European VC-backed companies markets,” says Uli Fricke. “That is providing us with from the same vintage year were as likely to exit via new and valuable potential exit routes.” IPO as their US counterparts. Well-placed for market growth In addition, Europe’s VCs will be in the right position to benefit from an improvement in M&A markets – and not just because they have world-class portfolio 4ENERGY: ENERGY EFFICIENCY SOLUTIONS WATCH THE FILM European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 4: Venture capital boosts economic growth SECTION 4: 27 VENTURE CAPITAL BOOSTS ECONOMIC GROWTH European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 4: Venture capital boosts economic growth VENTURE CAPITAL THAT WILL 28 CREATE EUROPEAN GROWTH

Building companies that will drive European growth “The finance [helps] companies that wouldn’t find funding elsewhere, usually because they are pre- It has long been recognised that small and medium- revenue or pre-profit stage. These companies simply sized companies are the lifeblood of the economy. wouldn’t exist without venture capital.” A recent Confederation of British Industry (CBI) report found that UK companies with a turnover Indeed, a recent research paper by Deutsche Bank of between £10m and £100m represented less found that a rise in venture capital investments of 0.1% than 1% by number but had the potential to of GDP can increase real GDP growth by inject between £20bn and £50bn into the 0.3 percentage points. The same rise in seed and economy by 2020. early-stage investments could increase GDP growth by 0.96pp. It says: “Countries with high VC activity Venture capital plays a vital role in getting companies typically have stronger economic growth.” to this stage and beyond. “Europe’s venture capital funds are highly important to the region’s economy,” says Sophie Manigart, co-author of an independent study into the impact of venture capital on Europe’s companies, drawn from VICO project data.

The finance[helps] companies that wouldn’t find funding elsewhere, usually because they are pre-revenue or pre-profit stage. These companies simply wouldn’t exist without venture capital.

Prof. Sophie Manigart University of Ghent European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Section 4: Venture capital boosts economic growth VENTURE CAPITAL THAT WILL CREATE 29 EUROPEAN GROWTH continued...

European venture capital improves patent stock (a measure of innovation levels) five years sales fall during the post-crisis years of 2008 and company performance after initial investment, while non-venture capital- 2009, VC-backed companies continued to grow and backed companies saw an increase of less than 9% create new jobs. The VICO report finds an “unequivocally positive” over the same period. impact on the productivity and growth of companies Venture capital breeds future success with venture capital backing, particularly when European venture capital creates jobs and growth – Based on a sample of high and middle income investment is received at seed stage. This is mainly even during crisis times countries (mainly OECD), the VICO project found that achieved, the report says, through sales growth. A large body of evidence suggests that venture capital the availability of venture capital in a country motivates European venture capital stimulates innovation creates jobs and growth in Europe. However, the crisis nascent entrepreneurs to adopt “high growth innovative has shown the extent of the support Europe’s venture strategies” because they can expect to be supported Most governments see innovation as the key to capitalists provided to portfolio companies through by VC. It adds that the presence of a vibrant VC market economic growth. Research by academics Fabio challenging times. While non VC-backed companies promotes “gazelle” types of entrepreneurship even if Bertoni and José Martì found that European venture slowed or even cut back on employment and saw businesses do not ultimately seek VC investment. capital-backed companies saw a 24% increase in

Figure 12. Employment growth rate of VC-backed Figure 13. Increase in patent stock five years after Key VC-BACKED NON-VC-BACKED and non-VC-backed companies During crisis years investment 2006 - 2009 [Source: VICO Project (2011)] [Source: Fabio Bertoni & José Martì] VC-BACKED COMPANIES 12% 11.49 25% 23.6

10% 8.81 20.6 20% +23.6% 8% 5.97 6% 16.8 15% 4% 12.7 NON-VC-BACKED 2% 1.55 COMPANIES 0.40 10% 8.6 0% 7.4 7.5 7.6 5.5 <9% -2% 5% 3.0 -4% -4.77 -6% 0% 2006-07 2007-08 2008-09 1 2 3 4 5 European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital Data methodology DATA METHODOLOGY 30

Activity Data *PEREP_Analytics™ For more information on EVCA data please (Sources referring to EVCA\PEREP_Analytics™) contact: [email protected] or + 32 2 715 00 20, PEREP_Analytics™ is a centralised, non-commercial or visit EVCA Research and Data The activity data used in this report – covering pan-European private equity database. PEREP is a fundraising, investment, divestment – are produced by joint Pan-European statistics platform of the following the EVCA and from the EVCA and PEREP_Analytics™*. private equity associations: APCRI (Portugal), AVCO (Austria), BVA (Belgium), BVK (Germany), CVCA The activity data used in this report are aggregated (Croatia), CVCA (the Czech Republic), DVCA (Denmark), according to market statistics. These refer to the EstVCA (Estonia), EVCA (Europe), FVCA (Finland), country in which the investee company is based, HVCA (Hungary), IVCA (Ireland), LTVCA (Lithuania), regardless of the location of the private equity fund. NVCA (Norway), NVP (the Netherlands), PSIK (Poland), At the European level, this relates to investments in SECA (Switzerland), SEEPEA (South Eastern Europe), European companies regardless of the location of the SLOVCA (Slovakia), SVCA (Sweden). PEREP has private equity firm. collects data directly from associations’ members as well as private equity fund managers that are not organised in associations to represent all European activity. Figures are updated on a continuous basis and are thus subject to change. European Private Equity and Venture Capital Association The Case for Investing in European Venture Capital 1. BARCELONA

160 high tech companies Academic institutions: ESADE, IESE, (established in the technological Universitat Politècnica de Catalunya district 22@) Also home to: Focus: Mobile telecoms, Mobile World Capital APPENDIX: PRINTABLE e-commerce, gaming, software EUROPEAN HUBS Birthplace of: Big names include:

2. BELGIUM 3. BERLIN 4. DENMARK 5. EINDHOVEN

Focus: Life sciences Academic institutions: Université 285 start-ups Academic institutions: Focus: Life sciences and cleantech Academic institutions: 100 local and Focus: Green sustainable Catholique de Louvain, Katholiek Freie Universität Berlin, University of Copenhagen, international companies technologies, software Focus: Digital media, social games, Also home to: Symbion Universiteit Leuven Humboldt University of Berlin, Technical University of Denmark consumer web services Academic institutions: Technical University of Berlin Eindhoven University of Technology Birthplace of: Big names include: Also home to: Tech Open Air Birthplace of: Big names include:

Birthplace of: Big names include: Birthplace of: Big names include:

6. HELSINKI 7. IRELAND 8. TECH CITY, LONDON 9. PARIS

Focus: Mobile telecoms, Academic institutions: Focus: Hardware, Medtech Academic institutions: 800 technical and creative Academic Partners: Imperial College 700 start-ups Academic institutions: Universities gaming, open source Aalto University, University of Helsinki Trinity College, University College businesses London, Loughborough University of Paris VI and Paris VIII, Institute de Focus: Media, advertising, Dublin, University College Cork Recherché et d’Innovation Focus: Consumer web services, Also home to: e-commerce, wireless Birthplace of: Big names include: digital media, e-commerce and Seedcamp Also home to: LeWeb, Le Camping finance Birthplace of: Big names include: Birthplace of: Big names include: Birthplace of: Big names include:

10. RHEIN-MAIN-NECKAR 11. SILICON FEN 12. STOCKHOLM 13. SWITZERLAND

5,000 software companies Academic institutions: Technical 1,000 high tech companies Academic institutions: Focus: Academic institutions: 880 medtech companies Academic institutions: University of University of Darmstadt, Johann Cambridge University Telecoms, peer to peer, software Royal Institute of Technology, Basel, University of Berne, University Focus: IT Focus: Semiconductors, wireless, Focus: Medtech and Wolfgang Goethe University of Stockholm University of Zurich data and biotech Also home to: pharma/life sciences Also home to: Frankfurt am Main, University of Cambridge Angels European Space Operations Center Mannheim, University of Heidelberg Birthplace of: Big names include: Birthplace of: Big names include:

Birthplace of: Big names include: Birthplace of: Big names include: Dörte Höppner Secretary-General, EVCA | [email protected] | +32 2 715 00 20 | www.evca.eu