Transcript of "DealMarket Digest - up-to-date news of the world of Private Equity & Venture Capital"
DIGEST 78SEE WHAT’S NEW AND NOTEWORTHY IN PRIVATE EQUITY THIS WEEK /// ISSUE 78 1 Five Trends in PE for France 2 Top Tech Predictions for Businesses Preqin Says Buyouts Bounced Back 2 in 2012 3 The UK’s Edge in Financial Technology Innovation What’s Better than Consumer 3 Internet for VCs? 3 Quote of the Week: Fabrice Grinda Streamlined Spending January 11, 2013
FIVE TRENDS IN PE FOR FRANCEIn a report that singled out the emerging team at AXA Private Equity, its expansion and establishment inthe secondary sector, unquote reviewed the very quiet year of PE activity in France. The five trends andevents s of the year in PE in France from unquote are listed below. Zephyr figures for M&A activity in France for 2012 also show a decline of activity by volume, the lowest in three years. (See Zephyr Graphic) Unquote’s View on France Election year: Like the US, France had an election year with a new government in place. The result of more left wing win will not be “as devastating as expected”, but the drawn-out uncertainty and the various U-turns on several key issues encouraged PE players to keep activity to a minimum. Lacklustre dealflow: Dealflow fell by nearly a third compared to the previous year to 208 deals, and overall value took an even steeper dip to EUR 8.1 billion, less than half the previous years total. France came in third in Europe for overall dealflow. Image source: ZephyrTough fundraising: For the fourth year in a row, French GPs invested more than they raised, andfundraising figures for the whole of 2012 are likely to settle at a historically low level.Few large buyouts: There were no deals greater than EUR 1 billon mark but a couple of large-cap dealscould be reported: Lion Capital acquired eyewear retailer Alain Afflelou from Bridgepoint, Apax Franceand Altamir Amboise in a deal believed to be valued at nearly EUR 800 million, and AXA Private Equitydid a EUR 850 billion MBO of Fives Group.AXA Private Equity goes large: closed a good number of mid-market deals and raised two funds.According to unquote data, the French GP completed 17 transactions worth a combined EUR 2.4 billionacross Europe.1 www.DealMarket.com/digest
TOP TECH PREDICTIONS FORBUSINESSES In the last issue we provided some summaries of predictions for 2013 and in this issue we continue with the top Tech predictions that affect IT departments, from Ruth Cheesley, founder of Virya. 1. Cloud-Based Phone Calls 2. Further Enhancements to the Shopping Experience 3. SEO Gets Personal 4. Social Signals Take Priority (affecting search engine rankings) 5. Open Source is King 6. Responsive Website Design (frameworks such as the Twitter Bootstrap and Foundation 3 will be adopted as best practice for website design). 7. Rising ApprenticeshipsImage source:Virya Technologies websitePREQIN SAYS BUYOUTS BOUNCED BACKIN 2012Preqin’s latest report says that North American contributed strongly to a global dealflow transactionvolume that reached a post-Lehman high in 2012. Globally, Preqin recorded 2,866 buyout deals, valuedat USD 254.6 billion. It is close to the 2011 level of activity, and a 14 percent increase in the number ofbuyout deals in 2010. According to Anna Strumillo, Manager Buyout and Venture Capital Deals atPreqin, North America witnessed a strong 2012, recording a post-2008 high for the year of 1,590 buyoutdeals valued at an aggregate USD 152.3bn. She also said that European deal levels remained low in2012. However, the USD 24.5bn of European deals announced during Q4 2012 is a 76 percent increasefrom the previous quarter, an encouraging indicator for 2013.2 www.DealMarket.com/digest
THE UK’S EDGE IN FINANCIALTECHNOLOGY INNOVATIONThe UK has got to be one of the leading locations for banking and finance innovation. It is not our aimtoday to theorize why it is more entrepreneurially innovative in this sector than say Switzerland, forexample, rather here’s a summary of some recent financings. In the first week of the New Year, iwocaraised GBP 2 million from Beyond Digital for its online merchant financing startup, according to PE Hub.Other startups that are attracting investors include Zopa, Funding Circle and Crowdcube, according toBBC Online.WHAT’S BETTER THAN CONSUMERINTERNET FOR VCS?PE Hub has a feature on the less spectacular side of technology investment, enterprise software andnetworking. The article points out that consumer Internet companies capture the headlines andattention but that the exits have been strong, with enterprise representing 70 percent of venture exitsin the last two years, and a value of USD 500 million. These exits have “also outperformed” consumerInternet ventures post-IPO. “Of the top 10 largest IPOs in the last 2 years, all the enterprise companiesin that bracket are trading above their offering prices,” reported PE Hub. The article concludes thatdespite the reduction in spending among businesses, growth is predicted for enterprise sectorinnovators driven by the increasing expansion of computing power and the growth of big data.QUOTE OF THE WEEK:FABRICE GRINDA STREAMLINED SPENDING “Very few successful entrepreneurs have the courage to start over… Once you have a site with 150 million unique visitors per month and a fully-fledged team which can do almost anything, starting without either is daunting. The same applies to material comfort”. Image source: Fabrice Grinda’s Musings blog3 www.DealMarket.com/digest
Who said it: Fabrice Grinda, Internet entrepreneur and angel investor, co-founder OLX, a free localclassified site. He was an important player in two other successful tech ventures prior OLX.In Context: In an article entitled “The Very Big Downgrade”, successful entrepreneur, Fabrice Grinda,describes how he reduced his monthly expenses to a tenth of his previous spending pattern. Accordingto his report, he shed a house in Bedford, an apartment in New York and sold his McLaren. He gave 75percent of his non-financial material possessions to charity and most of the rest to his friends andfamily. He will keep spending down by staying in hotels in London, Paris or New York. Even with thatexpense, he said, his monthly expenses would be more than a fifth of what they most recently were. Inthe meantime, “unburdened by the trappings of success and traditional societal constraints”, Grindastepped down from his post at OLX and plans to start a new venture, and perhaps start VC fund.Where we found it: Entrepreneur Country4 www.DealMarket.com/digest
The Dealmarket Digest empowers members of Dealmarket by providingup-to-date and high-quality content. Each week our in-house editor siftsthrough scores of industry and academic sources to find the mostnoteworthy news items, scoping trends and currents events in the globalprivate equity sector. The links to the sources are provided, as well as aneditorialized abstract that discusses the significance of the articlesselected. It is a free service that embodies the values of the Dealmarketplatform delivers: Professional, Accessible, Transparent, Simple, Efficient,Effective, and Global.To receive the weekly digest by email register on www.dealmarket.com.Editor: Valerie Thompson, ZurichDealMarketDealMarket launched in 2011 and is growing fast. Just one year afterlaunch, DealMarket counts more than 35,000 recurring users from 154countries, and over 3,000 deals and service providers promoted or listedon the platform.DealMarket is an online platform enabling private equity buyers, sellersand advisors to maximize opportunities around the world – a one-stopshop for Private Equity professionals. Designed by Private Equityprofessionals for Private Equity professionals, the platform is easy to use,cost effective and secure, providing access, choice and control across theinvestment cycle.DealMarket’s offering includes• DealMarketPLACE, an unfiltered view of the global deal and advice marketplace, where searching is free and postings are the price of a cappuccino a day (with no commission).• DealMarketSTORE offers affordable access to industry-leading third-party information and services on demand; and• DealMarketOFFICE is a state-of-the-art deal flow management tool, helping Private Equity investors to capture, store, manage and share their deal flow more efficiently.DealMarket was voted the “Best Global Private Equity Platform for 2012”by Corporate Newswire. www.DealMarket.com