Italian Private Equity and Venture Capital AssociationItalian Private Equity and Venture Capital Association

Il mercato del seed e Il mercato del seed e venture capital in Italiaventure capital in Italia

PaviaPavia, , 2277th th May 2002May 2002

Anna GervasoniAnna Gervasoni

Investment activity by number, Investment activity by number, companies and amountcompanies and amount

269 175

944

390 309

1.778

646 490

2.968

489364

2.185

0

1.000

2.000

3.000

1998 1999 2000 2001

Number Companies Amount (Euro mln)

- 26 %

A.I.F.I.A.I.F.I.

2001: % stage distribution of investments2001: % stage distribution of investments

46%

13%

38%34%

10%6% 6%

47%

0%

10%

20%

30%

40%

50%

Seed/Start up Expansion Replacement Buy out

Number Amount

A.I.F.I.A.I.F.I.

2001: % distribution of investments by 2001: % distribution of investments by number of employeesnumber of employees

A.I.F.I.A.I.F.I.

58%

25%

6% 5% 4% 2%

0%

10%

20%

30%

40%

50%

60%

0 - 19 20 - 99 100 - 199 200 - 499 500 - 999 > 1.000

89%

2001: Geographical distribution of 2001: Geographical distribution of investmentsinvestments

A.I.F.I.A.I.F.I.

80%84%

17%14%

3% 2%

0%

20%

40%

60%

80%

100%

Italy Europe Other

Number Amount

2001: Target companies distribution by 2001: Target companies distribution by regionregion

A.I.F.I.A.I.F.I.

36

16

51

13334445579121620

30

79

0

20

40

60

80

100

Lomba

rdia

Emilia Ro

mag

na

Friu

li

Tos

cana

Ven

eto

Piemon

te

Laz

io

March

e

Calab

ria

Sarde

gna

Cam

pania

Pug

lia

Abruz

zo

Ligu

ria

Sici

lia

Tren

tino A.

A.

Umbria

Molise N/A

20002000 ––2001: Divestment distribution2001: Divestment distribution

A.I.F.I.A.I.F.I.

58%

47%

10%4%

11%7%

5%

21%16%

21%

0%

10%

20%

30%

40%

50%

60%

70%

Trade sale Sale to otherVCst-Fin.Ist.

IPO-Post IPO sale Write off Other

2000 2001

Fund raising activity (Euro mln)*Fund raising activity (Euro mln)*

A.I.F.I.A.I.F.I.

1.051

2.207

2.925

1.875

0

1.000

2.000

3.000

1998 1999 2000 2001

* Excluding Pan-European funds

2001: Geographic distribution2001: Geographic distributionof funds raised on the marketof funds raised on the market

A.I.F.I.A.I.F.I.

Other20%

USA2%

Europe18%

Italy 60%

Focus: Early stage Focus: Early stage High TechHigh Tech

Trend - Trend - Number of Seed and Start up Number of Seed and Start up investorsinvestors

14

22

44

37

0

10

20

30

40

50

1998 1999 2000 2001

A.I.F.I.A.I.F.I.

Trend - Seed and Start up investmentsTrend - Seed and Start up investmentsby number and amountby number and amount

94 109153 147

339

540

222

291

0

200

400

600

1998 1999 2000 2001

Number Amount (Euro mln)

A.I.F.I.A.I.F.I.

68%

32%

66%

34%

0%

20%

40%

60%

80%

100%

Number Amount

Follow on Initial round

2001 – Initial rounds vs. Follow on 2001 – Initial rounds vs. Follow on by number and amountby number and amount

152

191

70

100

0

50

100

150

200

Follow on Initial round

Number Amount (Euro mln)

A.I.F.I.A.I.F.I.

Trend - Average invested amountTrend - Average invested amountin Early stage (Euro mln)in Early stage (Euro mln)

1,10,96

1,59

1,31

0,0

0,5

1,0

1,5

2,0

1998 1999 2000 2001

A.I.F.I.A.I.F.I.

Trend - Trend - High tech investment activity by High tech investment activity by number, number,

companies and amountcompanies and amount

33 14100 118

325 326224

672

248167

1.012

0

200

400

600

800

1.000

1.200

1998 1999 2000 2001

Number Companies Amount (Euro mln)

A.I.F.I.A.I.F.I.

N/A

+ 51%

2001: Stage distribution of high tech 2001: Stage distribution of high tech investmentsinvestments

182

108

266

44 41

135

17 14 29 5 4

582

0

200

400

600

Seed/Start up Expansion Replacement Buy Out

Number Companies Amount (Euro mln)

A.I.F.I.A.I.F.I.

A.I.F.I.A.I.F.I.

Trend - % of amount and number of Trend - % of amount and number of investments investments

in high tech companiesin high tech companies

51%46%

51%23%

30%18%

15%11%

0% 10% 20% 30% 40% 50% 60%

2001

2000

1999

1998

Number Amount

Trend – Investment activity in high tech Trend – Investment activity in high tech companiescompanies

by stage (number)by stage (number)

77

266

188

2553 44

4 417 12 3 5

0

50

100

150

200

250

300

Seed/Start up Expansion Replacement Buy out

1999 2000 2001

A.I.F.I.A.I.F.I.

Trend – Investment activity in high tech Trend – Investment activity in high tech companiescompanies

by stage (Euro mln)by stage (Euro mln)

85

417

266

82

164135

41 21 29

11770

582

0

100

200

300

400

500

600

Seed/Start up Expansion Replacement Buy out

1999 2000 2001

A.I.F.I.A.I.F.I.

2001 –2001 – Seed and Start up investmentSeed and Start up investmentssby sectorby sector (Euro mln)(Euro mln)

18

3

247

23

0

50

100

150

200

250

300

Seed Start up

High Tech amount Low Tech amount

A.I.F.I.A.I.F.I.

2001 – Seed and Start up investments by 2001 – Seed and Start up investments by numbernumber

17

4

165

36

0

60

120

180

Seed Start up

High Tech Low Tech

A.I.F.I.A.I.F.I.

2001 - Number of Early stage investments2001 - Number of Early stage investmentsby type of investorsby type of investors

3

36

2

16

0 0 211 13

128

110

0

25

50

75

100

125

150

Adv. of PE funds andInt. Banks

Advisor of venturecapital funds

Italian Banks andsubsidiaries

Italian closed-endfunds

Industrial/PrivateInv. Comp.

Regional and Publicplayers

Seed Start up

A.I.F.I.A.I.F.I.

Trend Trend – – Early stage investmentsEarly stage investmentsby type of investors (% number)by type of investors (% number)

7% 29% 10% 3% 8% 43%

6% 64% 10% 5% 14%

5% 63% 6% 8% 18%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

2001

2000

1999

Adv. of PE funds and Int. Banks Advisor of VC funds

Italian Banks and subsidiaries Italian closed-end funds

Industrial/Private Inv. Comp. Regional and Public players

A.I.F.I.A.I.F.I.

Evolution of investments (number)Evolution of investments (number)in some specific sectorsin some specific sectors

48 6

15 6

16 5

1216

2825

64

21

0

10

20

30

40

50

60

70

Biotech Medical devices Pharmaceuticals TLC: Hw TLC: Carriers

1999 2000 2001

A.I.F.I.A.I.F.I.

Sectoral distribution of Sectoral distribution of Early stage Early stage dealsdeals(by number)(by number)

51 2 3

63

12

27

58

16

0

15

30

45

60

Biotech Medical devices Pharmaceuticals TLC: Hw TLC: Carriers

2000 2001

A.I.F.I.A.I.F.I.

2001: Sectoral distribution of high tech 2001: Sectoral distribution of high tech investments by number (%)investments by number (%)

Others4%

Biotech2%

IT15%

Electronics2%

Industrial Automation

1%

Internet40%

Medical devices1%

Telecom19%

Manufacturing8%

Other services4%

Communication (other)

4%

A.I.F.I.A.I.F.I.

2001: Geographical distribution2001: Geographical distributionof high tech investments (%)of high tech investments (%)

71%

85%

25%

14%4% 1%

0%

20%

40%

60%

80%

100%

Italy Europe Other

Number Amount

A.I.F.I.A.I.F.I.

2001: Geographical distribution2001: Geographical distributionof high tech investments (%)of high tech investments (%)

43%

75%

6% 2% 4% 1%

46%

23%

0%

20%

40%

60%

80%

North Centre South+Islands N/A

Number Amount

A.I.F.I.A.I.F.I.

Italy: Regional Early stage investments Italy: Regional Early stage investments distribution by numberdistribution by number

114

3529

2418

12 8 8 6 5 4 3 3 2 2 2 1

25

106 4 5 2

82

80 3 0 3 0 0 1 3 1 1

73

0

20

40

60

80

100

120

Lomba

rdia

Emilia Ro

mag

na

Vene

toLa

zio

Piem

onte

Campa

nia

Friuli

Sardeg

na

Toscan

a

Sicil

ia

March

e

Basil

icata

Calabria

Molise

Pugli

a

Umbria

Abruzz

o

Ligu

ria

Tren

tino

n/a

2000 2001

A.I.F.I.A.I.F.I.

Italy: Regional high tech investments Italy: Regional high tech investments distributiondistributionby numberby number

0112222335561718

27

131

30

81

1002110514250

6713

4

45

0

20

40

60

80

100

120

140

2000 2001

A.I.F.I.A.I.F.I.

Focus: The incubation Focus: The incubation systemsystem

The sampleThe sample

• The total sample was made up of 57 players operating on the Italian market subdivided as follows:

• 37 incubators linked to Business Innovation Centres (BIC);

• 15 incubators located in Scientific and Technological Parks;

• 5 university incubators.

• Data and information were collected by a three

sections questionnaire sent to the sample players

• On the total number of active incubators, the

response ratio was 86%, representing 38 players on

44.

A.I.F.I.A.I.F.I.

The research evidenceThe research evidence

• The whole players aim to the promotion of the economic and cultural environment of the territory in which they operate.

• On an aggregate level the sample shows the following figures:• over 150.000 m2 of available areas for incubation

activities;• about 1.000 stations available for new initiatives;• about 200 active employees within incubators;• about 1.180 incubated firms on Dec. 2001;• 500 new firms incubated per annum, on average.

A.I.F.I.A.I.F.I.

The research evidenceThe research evidence (cont’) (cont’)

• On a geographical level the survey evidences the following figures:

• 76% of players operates exclusively in their own region;

• 11% of the total sample is active on a national level;

• 13% carry out incubation activity even outside Italy.• Referring to geographical localization, the sample

is subdivided as follows:• 54% of incubators is located in Northern Italy;• 14% is in the Centre;• 32% is located in the South.

A.I.F.I.A.I.F.I.

The figuresThe figures

Characteristics BIC PSTUniversities

Total sample

Grand total

Total available areas (m2)

130.000

19.000

2.500 151.500 175.421

Total number of employees for

incubation activity 147 30 9 186 218

Total number of available stations

630 319 46 995 1.152

Average number of hosted firms per

annum 431 67 21 519 610

Total number of hosted firms at 31-

12-2001 876 247 56 1.179 1.406

A.I.F.I.A.I.F.I.

Characteristics BIC PSTUniversities

Total sample

Grand total

Average available area (m2)

5.000 2.375 625 2.667

Total number of employees for

incubation activity 5,7 3,8 2,3 3,9

Average number of employees per

incubator 24 40 12 25

Average number of available stations

per incubator 3,7 2,2 2 2,6

Average number of incubation years*

4,3 3 2,7 4

Survival ratio 90% 94% 100% 95%

The figuresThe figures (cont’) (cont’)

* average of maximum number of yearsA.I.F.I.A.I.F.I.

A.I.F.I. achievementsA.I.F.I. achievements

A.I.F.I. standard Information Memorandum “Guidelines” for closed-end funds reserved to qualified investors

Bank of Italy regulation (July 19th

2001) for Management Companies (SGR) deicated to small VC funds

A.I.F.I.A.I.F.I.

Fiscal revision of closed-end funds: carried

interest taxation

Legal revision of “honour and professional

requirements” of managing directors

Fund raising strengthening: pension funds,

Fund of funds

Promotion of public incentives for VC

Contribution for start up costs of

management companies (SGR)

A.I.F.I. future objectivesA.I.F.I. future objectives

A.I.F.I.A.I.F.I.

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