V E N T U R E C A P I T A L R E P O R T

Venture Capital Report Europe | 2Q | 2016

V E N T U R E C A P I T A L R E P O R T

VENTURE CAPITAL REPORT

The following report presents Dow Jones VentureSource’s quarterly findings for European venture capital fundraising, investment, valuation, and liquidity. The included charts and graphs offer a comprehensive view of the trends currently affecting the venture capital market.

Highlights for 2Q 2016 include: 

•  European venture capital fundraising amount declined slightly from prior quarter but was higher compared to the same quarter in 2015;

•  Venture capital investment into European companies increased significantly from 1Q 2016;

•  Both the number of mergers and acquisitions (M&As) and the total M&A raised amount experienced a decrease from the last quarter;

•  The number of initial public offerings (IPOs) and total amount raised increased significantly from 1Q 2016.

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EUROPEAN VENTURE CAPITAL FUNDRAISING ROCKETS IN 2Q 2016

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FUNDRAISING

European VC Fundraising Based on multiple closings (2013–2016) 21 European venture capital funds reached

€2.51 billion during 2Q 2016. Compared with 1Q 2016, total capital raised experienced a slight decline, and the number of fund closings decreased by 16%.

•  Compared with the same period last year, euros raised improved by 17%, while the number of fund closings

decreased by 19%

•  EQT Ventures was the largest fund of this quarter, which raised €566 million, accounting for 23% of the total amount raised in 2Q 2016

2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16

Amount Raised (€B) € 1.33 € 0.85 € 2.62 € 0.89 € 1.73 € 1.10 € 1.58 € 1.26 € 2.14 € 1.25 € 1.59 € 2.90 € 2.51

Number of Funds 17 12 44 23 24 20 27 23 26 16 24 25 21

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LARGEST EUROPEAN VC FUNDS RAISED IN 2Q 2016

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FUNDRAISING

Firm Name Fund Name Amount (€M) Location Offering Status Fund Type Fund Category Closing Type

EQT Ventures EQT Ventures € 566.00 Stockholm,

Sweden Closed Multi-stage venture

capital Venture Capital Final

Accel Partners Accel London V € 465.03 London, United Kingdom Closed Early-stage venture

capital Venture Capital Final

Rocket Internet AG Rocket Internet Capital Partners

SCS € 223.06 Berlin, Germany Open Late-stage venture

capital Venture Capital

Interim

Cherry Ventures GmbH Cherry Ventures II € 150.00 Berlin, Germany Closed Early-stage venture

capital Venture Capital

Final

JSFC Sistema Venture Capital Sistema Venture Capital Fund €143.45 Moscow, Russia Open Late-stage venture

capital Venture Capital First

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INVESTMENT INTO EUROPEAN VENTURE-BACKED COMPANIES INCREASED IN 2Q 2016

European companies raised around €3.02 billion for 461 deals during 2Q 2016, an 18% increase in the amount raised from the prior quarter as well as a 9% rise in the number of deals.

•  Compared with the same period last year, investment amount decreased by 22%, whereas the number of deals grew by 8%

•  Consumer Services was the strongest sector of the quarter in terms of attracting investment and number of deals

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FINANCING Equity Financings into Europe-based,

VC-backed Companies (2013–2016)

2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16

Amount Raised (€B) € 1.53 € 1.77 € 1.99 € 1.61 € 2.44 € 2.35 € 2.07 € 2.81 € 3.86 € 3.44 € 3.46 € 2.56 € 3.02

Number of Deals 436 414 506 418 461 376 427 429 427 410 492 422 461

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES, BY ROUND CLASS (2013–2016) – NUMBER OF DEALS

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FINANCING

2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16

Seed 41 61 76 41 36 31 43 30 41 36 36 37 25

First 218 213 229 221 232 188 205 219 187 201 260 200 244

Second 86 66 86 63 92 66 76 79 77 80 93 94 90

Later 64 50 81 61 77 62 60 78 100 76 73 79 81

Restart 0 0 0 0 0 1 0 1 0 0 1 0 1

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES, BY ROUND CLASS (2013–2016) – AMOUNT RAISED (€M)

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FINANCING

2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16

Seed € 18 € 25 € 32 € 21 € 23 € 16 € 32 € 30 € 24 € 30 € 28 € 32 € 18

First € 432 € 512 € 507 € 472 € 647 € 487 € 461 € 616 € 568 € 917 € 769 € 690 € 761

Second € 467 € 708 € 404 € 300 € 468 € 220 € 780 € 443 € 931 € 575 € 614 € 763 € 667

Later € 596 € 469 € 988 € 696 € 1,122 € 901 € 756 € 1,650 € 2,192 € 1,873 € 1,582 € 1,054 € 1,545

Restart € 0 € 0 € 0 € 0 € 0 € 1 € 0 € 1 € 0 € 0 € 1 € 0 € 2

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES (2013–2016) – MEDIAN EQUITY DEAL SIZE (€M)

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FINANCING

2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16

Median Equity Deal Size (€M) € 1.52 € 1.00 € 1.35 € 1.45 € 1.81 € 1.53 € 2.00 € 1.93 € 2.30 € 2.10 € 2.00 € 2.39 € 2.10

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES, BY INDUSTRY GROUP (2Q 2016)

Consumer Services received the largest allocation of investment during 2Q 2016, raising €1.1 billion through 132 deals. The sector attracted 36% of the total amount invested and 29% of all deals completed for the quarter.

Business and Financial Services ranked the second highest proportion of investment. The sector garnered €722.37 million across 124 deals, remaining stable in terms of deal number and dropping 4% in amount invested from 1Q

2016.

Information Technology represented the third, receiving €605.73 million across 107 deals. The sector’s investment figure represents 20% of the total equity financing into European VC-backed companies for 2Q 2016.

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FINANCING 2Q'16 Industry Breakdown By Number of Deals

2Q’16 Industry Breakdown By Amount Raised

27%

2%

29% 2%

15%

1%

23%

Business and Financial Services

Consumer Goods

Consumer Services

Energy & Utilities

Healthcare

Industrial Goods & Materials

Information Technology

24%

1%

36% 2%

16%

1%

20% Business and Financial Services

Consumer Goods

Consumer Services

Energy & Utilities

Healthcare

Industrial Goods & Materials

Information Technology

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TOP 5 DEALS INTO EUROPEAN VC-BACKED COMPANIES (2Q 2016)

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Co. Name Location Industry

Code Industry Segment

Industry Group

Brief Description

Close Date

Round Type

Raised (€M)

Round Investors (* denotes lead)

Global Fashion Group SA

Luxembourg, Luxembourg

Clothing / Accessory Retailers

Retailers Consumer Services Provider of an online fashion

platform. 27/04/2016 3rd € 300.00 Kinnevik, Rocket Internet AG

Maxi Mobility Spain SL (Cabify)

Madrid, Spain Transportation

Services Travel and Leisure Consumer Services Provider of a smartphone

application that enables users to book luxury cabs with chauffeurs.

20/04/2016 5th € 111.61 Rakuten Ventures*

FarFetch.com Ltd.

London, United

Kingdom

Shopping Facilitators

Consumer Information Services Consumer Services

Provider of a global e-commerce site for independent fashion

boutiques. 04/05/2016 6th € 102.31

e.ventures, Eurazeo SA*, IDG Capital Partners*, Temasek Holdings Pvt. Ltd.*, Vitruvian Partners

LLP

Ambatana Holdings BV

(letgo)

Naarden. Netherlands

Shopping Facilitators

Consumer Information Services Consumer Services

Provider of a mobile application to buy and sell used goods

locally. 12/05/2016 Second

Round € 93.01 Naspers Ventures

SoundCloud Ltd. Berlin,

Germany

Movie / Music Producers and

Distributors Media and Content

Consumer Services

Provider of an online platform to send, receive, and distribute

music. 14/06/2016 6th € 63.07 Twitter Ventures*

FINANCING

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MOST ACTIVE INVESTORS FOR EUROPE-BASED, VC-BACKED COMPANIES (2Q 2016) BY DEALS COMPLETED

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FINANCING

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Bpifrance Investissement SAS

High-Tech Gruenderfonds

Management GmbH

Enterprise Ireland Scottish Enterprise Bayern Kapital GmbH

e.ventures Point Nine Management GmbH

Kima Ventures

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES BY COUNTRY (2Q 2016)

The United Kingdom remained the most favoured destination for equity financing during 2Q 2016, receiving €870.11 million across 115 deals. The country took 29% of all equity financing from 2Q 2016.

Germany ranked second. It reached a total of €547.92 million through 80 deals, representing an 18% share of European financing. An 11% increase in capital invested and 7% rise in the number of deals from last quarter.

Luxembourg occupied third position raising €300 million, 10% of the total for the quarter. France placed fourth having raised €291.83 million during 2Q 2016.

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FINANCING Number of Deals in 2Q 2016 by Country (Top 4)

Amount Raised in 2Q 2016 by Country (Top 4)

23%

19%

26%

19%

18%

7%

30%

United Kingdom

France

Germany

Spain

Rest of Europe

29%

18%

10%

10%

33%

United Kingdom

Germany

Luxembourg

France

Rest of Europe

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EUROPE 2Q 2016 VENTURE EXIT ACTIVITY

48 venture-backed M&As took place in Europe during 2Q 2016, an 8% decrease from 1Q 2016. The number is 9% higher than that of 2Q 2015.

Total amount raised through European VC-backed M&As in 2Q 2016 is €3.96 billion. This represents a 22% drop from the prior quarter and a 6% increase from the

same period last year.

9 venture-backed IPOs took place during 2Q 2016, an 80% increase from 1Q 2016 and a 40% decrease from 2Q 2015.

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LIQUIDITY

Exit Opportunities for European VC–backed Companies (2013–2016)

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2Q'13

3Q'13

4Q'13

1Q'14

2Q'14

3Q'14

4Q'14

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

2Q'16

2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16

IPOs 5 3 9 9 21 16 10 12 15 8 14 5 9

M&As 40 43 44 56 43 50 49 53 44 48 39 52 48

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TOP 3 M&As IN EUROPE (2Q 2016)

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Company Name Location Brief

Description Industry

Code Industry Segment Industry Group Close Date

Round Type

Amount Paid (€M) Acquirer

Withings SAS Issy-les-

Moulineaux, Farnce

Provider of devices and smartphone applications that

monitor personal health.

Electronic Components /

Devices

Electronics and Computer Hardware

Information Technology 31/05/2016 Acquisition € 170.00 Nokia Corporation

Ticketbis SL Bilbao, Spain Operator of an online platform for buying and selling tickets for any

type of events.

Shopping Facilitators

Consumer Information Services Consumer Services 30/06/2016 Acquisition € 148.67 eBay

Lifealike Ltd. (Onefinestay)

London, United Kingdom

Provider of upscale private homes rental services for

travellers.

Travel Arrangement /

Tourism Travel and Leisure Consumer Services 05/04/2016 Acquisition € 148.00 Accor Group

LIQUIDITY

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EUROPEAN VC-BACKED IPOs (2013-2016)

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LIQUIDITY

Both the number of deals and amount raised via IPO during 2Q 2016 increased significantly from the prior quarter.

9 venture-backed companies went public during 2Q 2016, an 80% increase from the prior quarter.

IPOs raised €156.84 million during 2Q 2016, a growth of 43% from the €110.05 million raised in 1Q 2016.

The largest European VC-backed IPO of 2Q 2016 was the Merus BV. The company raised €51.15 million for its

offering on NASDAQ.

2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q-16

Raised (€M) through IPO € 89.24 € 25.51 € 366.10 € 691.24 € 529.53 € 447.47 € 2,249.97 € 417.40 € 533.10 € 699.69 € 608.00 € 110.05 € 156.84

Number of IPOs 5 3 9 9 21 16 10 12 15 8 14 5 9

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TOP 3 IPOs IN EUROPE (2Q 2016)

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LIQUIDITY

Company Name Location Brief

Description Industry

Code Industry Segment Industry Group Close Date

Raised through IPO (€M)

Exchange/ Symbol

Merus BV Netherlands Developer of antibody therapeutics. Biotechnology Therapeutics Biopharmaceuticals Healthcare 19/05/2016 € 51.15 NASDAQ:MRUS

Wilson Therapeutics AB Sweden

Developer of treatments for Wilson’s Disease.

Biotechnology Therapeutics

Biopharmaceuticals Healthcare 12/05/2016 € 42.43 XSTO: WTX

Directa Plus PLC United Kingdom Producer of graphene-based

products for use in consumer and industrial markets.

General Industrial Machinery

Machinery and Industrial Goods

Industrial Goods and Materials

07/05/2016 € 17.97 AIM: DCTA

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ABOUT US & METHODOLOGY

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 report cover venture backed companies headquartered in Europe, and are based on aggregate findings of Dow Jones’ proprietary research for VentureSource.

This data was collected through surveys of professional firms, interviews with company executives, and from secondary sources. To be included, companies have to receive financing from a venture capital or private equity firm. Our figures do not include companies that have received funding solely from individual, corporate and/or government investors. The data in this report only accounts for equity funding, not convertible debt deals.

Figures contained throughout the report are current at time of editorial but 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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