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Private Financing of Entrepreneurships: Sources of Private ...
 

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    Private Financing of Entrepreneurships: Sources of Private ... Private Financing of Entrepreneurships: Sources of Private ... Presentation Transcript

    • CANADA-UNITED STATES LAW INSTITUTE Private Financing of Entrepreneurships: Sources of Private Financing
    • ALL SBIC PROGRAM LICENSEES Financing to Small Businesses Reported between October 2005 and September 2006
        • Number of Dollar Amount
        • Financings of Financing
        • SBIC Program Totals 3,674 $2,897,242,934
        • Regular SBICs 3,573 2,882,152,803
        • Bank-Owned/Non-Leveraged 128 187,817,112
        • Debenture SBICs 1,614 1,207,318,648
        • Participating Security 1,831 1,487,017,043
        • Specialized SBICs 101 15,090,131
        • Change from Fiscal Year 2005
        • SBIC Program Totals (9%) 0%
        • Regular SBICs (8%) 1%
        • Bank-Owned/Non-Leveraged (48%) (13%)
        • Debenture SBICs (9%) 10%
        • Participating Security (5%) (5%)
        • Specialized SBICs (17%) (108%)
    • NVCA National Venture Capital Association
      • Venture Capital Investment By Year – Money Tree
      • Co. Disbursement Avg. per Deal Sum Investment
      • Year Number of Deals (USD Mil) (USD Mil)
      • 1996 2469 4.36 10762.30
      • 1997 3080 4.74 14591.99
      • 1998 3550 5.84 20718.89
      • 1999 5396 9.91 53487.98
      • 2000 7812 13.36 104379.88
      • 2001 4451 9.11 40537.78
      • 2002 3053 7.11 21692.88
      • 2003 2876 6.82 19613.81
      • 2004 2991 7.28 21768.86
      • 2005 3027 7.35 22261.59
      • Source: PricewaterhouseCoopers/National Venture Capital Association Money Tree TM Report
      • Data: Thomson Financial – Updated 12/3105
    • NVCA National Venture Capital Association
      • Venture Capital Investment By Quarter – Money Tree
      • Co. Disbursement Avg. per Deal Sum Investment
      • Quarter Number of Deals (USD Mil) (USD Mil)
      • 2004-1 695 7.47 5191.44
      • 2004-2 836 7.45 6230.87
      • 2004-3 677 7.13 4824.19
      • 2004-4 808 7.13 5760.75
      • 2005-1 713 7.07 5040.82
      • 2005-2 806 7.83 6307.82
      • 2005-3 767 7.32 5613.52
      • 2005-4 791 7.19 5690.66
      • 2006-1 821 7.52 6173.78
      • 2006-2 892 7.52 6711.24
      • Source: PricewaterhouseCoopers/National Venture Capital Association Money Tree TM Report
      • Data: Thomson Financial – Updated 6/30/96
    • Venture Capital Management – Summary Statistics
              • 1980 1994 2005 (est.)
      • Number of VC Firms in Existence 89 395 915
      • Number of Professionals 1,308 4,345 9,250
      • Number of First-Time VC Funds Raised 21 16 40
      • VC Capital Under Management ($bn) 4.0 35.1 285
      • Sources: National Venture Capital Association Yearbook (2004) and Cambridge Associates LLC estimates.
    • VENTURE CAPITAL INVESTMENTS January 1, 1990 - September 30, 2005 Capital Invested ($ billions) Average Capital Invested Per Company ($ millions)
    • VENTURE CAPITAL DISBURSEMENTS BY FINANCING STAGE Percentage of Total Disbursements Dollars Invested ($ billions)
    • Distribution of Venture Capital Disbursements By Industry
      • Percentage of U.S. Dollars Invested
      • Industry Group 2001 2002 2003 2004 2005
      • Biotechnology 8.2 14.4 18.5 18.8 16.8
      • Business/Financial 6.3 4.1 5.6 4.1 6.0
      • Communications 27.7 23.1 18.3 16.3 17.2
      • Computer Hardware & Services 7.5 6.8 5.9 5.6 6.4
      • Computer Software 25.5 24.2 22.2 24.0 21.6
      • Health Care-Related 6.2 10.4 9.5 10.0 11.2
      • Industry/Energy 3.1 3.3 3.9 2.9 3.2
      • Retailing & Media 8.8 5.3 6.0 6.9 7.8
      • Semiconductors & Electronics 6.7 8.5 10.1 11.4 9.7
      • Total 100.0 100.0 100.0 100.0 100.0
      • Sources: Money Tree Survey, National Venture Capital Association, PricewaterhouseCoopers, and Thomson Venture Economics.
    • Distribution of Venture Capital Disbursements By Region
      • Percentage of U.S. Dollars Invested
      • Region 2001 2002 2003 2004 2005
      • Northern California 31.8 33.6 33.7 36.2 35.7
      • Northeast 30.5 27.7 30.8 29.4 27.4
      • Midwest 17.0 15.3 16.0 12.5 12.3
      • Southern California 8.8 10.1 9.6 9.8 11.6
      • Southeast 6.9 8.2 5.5 5.9 6.1
      • Northwest 3.4 3.4 3.1 4.5 3.9
      • Southwest 1.1 1.7 1.2 1.5 2.9
      • Alaska/Hawaii/Puerto Rico 0.4 0.0 0.1 0.1 0.0
      • Unknown 0.2 0.0 0.0 0.0 0.0
      • Total 100.0 100.0 100.0 100.0 100.0
      • Sources: MoneyTree Survey, National Venture Capital Association, PricewaterhouseCoopers, and Thomson Venture Economics.
    • NUMBER OF VENTURE-BACKED INITIAL PUBLIC OFFERINGS AND MERGERS AND ACQUISITIONS January 1, 1992 - December 31, 2006
    • NUMBER OF VENTURE-BACKED INITIAL PUBLIC OFFERINGS AND MERGERS AND ACQUISITIONS January 1, 1992 - December 31, 2006 Sources: National Venture Capital Association Yearbook and Venture Economics
    • PlacementTracker
      • With transaction data as of December 29, 2006, PlacementTracker is reporting 2006 full-year PIPE market issuances of $27.83 billion. This represents a 39% increase over the 2005 total of $20.01 billion and a 14% increase over the previous one-year issuance record set in 2000 with $24.34 billion. The fourth quarter of 2006 also set a new fourth-quarter record with $6.98 billion in PIPE Market issuances. All totals exclude Structured Equity Lines and Canadian-domiciled issuers.
      • Source: http://www.primenewswire.com
    • SPAC’s (Specialized Acquisition Companies)
      • In all, more than 50 SPAC’s filed to go public in 2005. About half of these, including Cold Spring Capital, have made it to market, raising around $1.2 billion that can be used for acquisitions. By comparison, only 11 deals went public in 2004, and those raised less than $500 million.
      • Source: http://www.usnews.com
    • CAPITAL COMMITMENTS TO PRIVATE EQUITY FUNDS January 1, 1984 - November 30, 2006 ($ billions) Sources: Asset Alternatives, Inc. and The Private Equity Analyst. 332a 191.0 Sources: Asset Alternatives, Inc. and The Private Equity Analyst. 332a 191.0 Sources: Asset Alternatives, Inc. and The Private Equity Analyst
    • CAPITAL COMMITMENTS TO DOMESTIC LEVERAGED BUYOUT FUNDS January 1, 1985 - February 28, 2007 ($ billions) Source: Buyouts
    • COMPARISON OF POOLED MEAN RETURNS OF VARIOUS PRIVATE EQUITY CATEGORIES END-TO-END RETURNS (%) NET TO LIMITED PARTNERS Periods Ended September 30, 2006
      • Average Annual Compound Returns (%)
      • Q3 One Three Five Ten Fifteen
      • Asset Class 2006 Year Years Years Years Years
      • U.S. Venture Capital 2.22 9.95 10.93 -1.65 37.00 29.83
      • U.S. Private Equity 3.98 22.56 26.05 15.20 13.18 14.68
      • U.S. Buyouts 3.66 25.98 30.47 18.45 16.54 18.63
      • U.S. Buyouts $0 - $150M -0.09 19.85 17.03 8.68 10.57 20.81
      • U.S. Buyouts $150 - $750M 4.75 22.08 26.79 15.40 18.60 20.88
      • U.S. Buyouts >$750M 3.49 21.22 25.46 15.46 11.89 12.97
      • U.S. Mezzanine Funds 2.84 16.55 15.01 9.42 11.80 12.76
      • Top Two Quartiles Only
      • U.S. Venture Capital 3.32 15.29 19.17 5.15 67.28 40.88
      • U.S. Private Equity 5.56 29.67 34.25 23.05 22.21 23.07
      • S&P 500 5.67 10.79 12.30 6.97 8.59 10.76
      • Russell 2000 R 0.44 9.92 15.48 13.78 9.06 11.25
      • Dow Jones U.S. Small Cap 0.07 9.39 16.00 15.03 10.49 n/a
      • Nasdaq Composite 1 3.97 4.96 8.12 8.55 6.29 10.19
      • Wilshire 5000 4.32 10.48 13.28 8.64 8.63 10.81
      • Sources: Cambridge Associates LLC Non-marketable Alternative Assets Database, Dow Jones & Company, Inc., Standard & Poor's, Thomson Datastream, The Wall Street Journal , and Wilshire Associates, Inc.
      • Notes: Returns are end-to-end pooled means net of management fees, expenses, and carried interest. The pooled means represent the end-to-end rates of
      • return calculated on the aggregate of all cash flows and beginning and ending market values as reported by the General Partners to Cambridge
      • Associates LLC in their quarterly and annual audited financial reports. The U.S. Venture Capital sample represents over 80% of the total dollars raised by U.S. venture managers between 1981 and 2005. The U.S. Private Equity sample represents over 70% of the total dollars raised by funds formed between 1986 and 2005. U.S. Private Equity includes buyout, special equity expansion, special situations, restructuring and mezzanine funds.
      • 1 Data are price returns only.