The following report presents Dow Jones VentureSource’s quarterly findings for European venture capital fundraising, investment, valuation, and liquidity. Charts and graphs available here offer a comprehensive view of the trends currently affecting the venture capital market.
Highlights for 4Q 2014 include:
European venture capital fundraising experiences uptick from 3Q 2014, but suffers declines in both fund closings and euros raised for the 12 month period;
Venture capital investment into European companies falls from 3Q 2014, but improves by a quarter year over year;
Despite an overall fall in exit activity, the total amount raised through venture-backed Initial public offerings (IPOs) reached its highest point since 2Q 2000.
FUNDRAISING
European Venture Capital Fundraising Experiences Uptick in 4Q 2014
18 European venture capital funds accumulated €927 million during 4Q 2014, an increase of 33% in euros
raised and 20% in the number of funds with closings from 3Q 2014.
Despite the uptick in fundraising from 3Q 2014, the number of funds with closings during 4Q 2014 fell by 51% compared with the same period last year, while euros raised fell by 49%.
The largest fund of the quarter was Principia SGR’s Fund III which raised €160 million, accounting for 17% of the total amount raised for 4Q 2014.
Overall, the number of fund closings in 2014 was down by 4% to 76 from the year prior, while the total amount raised by venture funds fell by 18% from 2013 to €3.4 billion.
Despite the uptick in fundraising from 3Q 2014, the number of funds with closings during 4Q 2014 fell by 51% compared with the same period last year, while euros raised fell by 49%.
The largest fund of the quarter was Principia SGR’s Fund III which raised €160 million, accounting for 17% of the total amount raised for 4Q 2014.
Overall, the number of fund closings in 2014 was down by 4% to 76 from the year prior, while the total amount raised by venture funds fell by 18% from 2013 to €3.4 billion.
FINANCING
Investment into European Venture-backed Companies Falls in 4Q 2014
Equity Financings into Europe –
based, VC-backed Companies
(2011 – 2014)
European companies raised €1.8 billion for 332 deals during 4Q 2014, a fall of 24% in the amount raised from
3Q 2014 despite just five fewer deals being completed.
In contrast with the year ago period, investment improved by 1% despite a 28% reduction in the number of completed deals.
In 2014 as a whole, European venture-backed companies attracted €7.9 billion across 1460 deals, a decline of 11% in deals completed from 2013 but an improvement of 25% in euros invested.
In contrast with the year ago period, investment improved by 1% despite a 28% reduction in the number of completed deals.
In 2014 as a whole, European venture-backed companies attracted €7.9 billion across 1460 deals, a decline of 11% in deals completed from 2013 but an improvement of 25% in euros invested.
Equity Financings into Europe-based, VC-backed Companies, by Industry Group
(4Q 2014)
Business and Financial Services received the largest allocation of investment during 4Q 2014 (32%), accumulating €557 million through 80 deals. The sector remained the most attractive sector despite investment dropping by 41% from 3Q 2014. Deal flow remained flat.
Healthcare rose to second in terms of equity financing, taking a 30% share of all 4Q 2014 investment. The sector raised €535 million across 60 deals, an increase of 64% in capital raised and 25% in deals completed from the previous quarter.
Consumer Services was pushed down to third, with companies in the sector gathering 18% of the total amount invested for the quarter. The sector received €327 million across 96 deals; a fall of 53% and 3% from 3Q 2014 in capital invested and deal flow respectively.
Business and Financial Services received the largest allocation of investment during 4Q 2014 (32%), accumulating €557 million through 80 deals. The sector remained the most attractive sector despite investment dropping by 41% from 3Q 2014. Deal flow remained flat.
Healthcare rose to second in terms of equity financing, taking a 30% share of all 4Q 2014 investment. The sector raised €535 million across 60 deals, an increase of 64% in capital raised and 25% in deals completed from the previous quarter.
Consumer Services was pushed down to third, with companies in the sector gathering 18% of the total amount invested for the quarter. The sector received €327 million across 96 deals; a fall of 53% and 3% from 3Q 2014 in capital invested and deal flow respectively.
Equity Financings into Europe-based, VC-backed Companies, by
Country (4Q 2014)
The United Kingdom was the most favoured destination for equity financing during 4Q 2014, receiving €524 million across 69 deals. The country took in 30% of all investment into European VC-backed companies for the quarter.
Germany placed second, capturing 18% of European investment. Investment fell by 73% from the prior quarter to total €322 million. Deal flow remained relatively stable, however, with 66 completed.
The Netherlands rose to third position raising €243 million, a 14% share of investment. France placed in fourth position with a 12% share, raising €218 million during 3Q 2014.
The United Kingdom was the most favoured destination for equity financing during 4Q 2014, receiving €524 million across 69 deals. The country took in 30% of all investment into European VC-backed companies for the quarter.
Germany placed second, capturing 18% of European investment. Investment fell by 73% from the prior quarter to total €322 million. Deal flow remained relatively stable, however, with 66 completed.
The Netherlands rose to third position raising €243 million, a 14% share of investment. France placed in fourth position with a 12% share, raising €218 million during 3Q 2014.
LIQUIDITY
Europe Sees Overall Decrease in 4Q 2014 Venture Exit Activity
Exit Opportunities for European
VC – backed Companies
(2011 – 2014)
(2011 – 2014)
42 venture-backed M&As took place in Europe during 4Q 2014, down 9% from 3Q 2014 but one up on the
figure for 4Q 2013.
The largest M&A for 4Q 2014 was Belgium’s Clear2Pay NV, an e-payment solutions provider, which was acquired by Fidelity National Information Services for €375 million.
55 venture-backed IPOs took place during 2014, tripling the number of listings seen across Europe in 2013. 201 M&As were completed during the course of 2014, a 21% increase on the 166 that took place during 2013.
The largest M&A for 4Q 2014 was Belgium’s Clear2Pay NV, an e-payment solutions provider, which was acquired by Fidelity National Information Services for €375 million.
55 venture-backed IPOs took place during 2014, tripling the number of listings seen across Europe in 2013. 201 M&As were completed during the course of 2014, a 21% increase on the 166 that took place during 2013.
European VC-backed IPOs (2011-2014)
10 IPOs were completed during 4Q 2014, a decline of 38% from the previous quarter’s total but an increase of one on those completed during 4Q 2013.
IPOs raised €2.3 billion during 4Q 2014, more than six times the figure seen in 4Q 2013 and the highest sum since 2Q 2000 when 71 IPOs raised a total of € 3.8 billion.
The largest European VC-backed IPO of 4Q 2014 was Rocket Internet AG’s October listing on the Frankfurt Stock Exchange. The company raised a total of €1.4 billion, accounting for 62% of the total amount raised through European venture-backed company IPOs for the quarter.
10 IPOs were completed during 4Q 2014, a decline of 38% from the previous quarter’s total but an increase of one on those completed during 4Q 2013.
IPOs raised €2.3 billion during 4Q 2014, more than six times the figure seen in 4Q 2013 and the highest sum since 2Q 2000 when 71 IPOs raised a total of € 3.8 billion.
The largest European VC-backed IPO of 4Q 2014 was Rocket Internet AG’s October listing on the Frankfurt Stock Exchange. The company raised a total of €1.4 billion, accounting for 62% of the total amount raised through European venture-backed company IPOs for the quarter.
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