Moneytree Analyst Call Q408
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Moneytree Analyst Call Q408

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Moneytree Analyst Call Q408 Moneytree Analyst Call Q408 Presentation Transcript

  • The MoneyTree™ Report Overview of Venture Capital Investments Fourth Quarter and Year End 2008 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report based on data from Thomson Reuters 1
  • Host of the Analyst Call Maryanne Coughlin Director, Technology Sector Analyst PricewaterhouseCoopers Maryanne Coughlin is a director at PricewaterhouseCoopers, serving as sector analyst for the Firm's US technology and venture capital industry practices. In this role, she advises partners and client teams on marketplace trends and their impact on technology sector firms. Prior to joining PwC in 2007, Maryanne was director of global services model and forecast management at IDC, a technology research firm. While at IDC, Maryanne launched and managed two new research services, presented at the firm's flagship US vendor conferences, and authored one of the firm's most popular research documents. Before joining IDC, Maryanne held positions in client services, marketing, interactive communications and editorial at marchFIRST (formerly USWeb/CKS), Tenet Healthcare, and the US Naval Institute. While at USWeb/CKS Maryanne led the engagement to design and create an award-winning online insurance marketplace. While at Tenet, Coughlin authored the Fortune 500 company's Internet business plan, established the company's brand on the Internet, and served on the Tenet Marketing Council. Earlier in her career, Maryanne worked for international startup Americom International Corp., assisting an entrepreneur in raising funding to build and operate a hotel and business center as a joint venture with Radisson Hotels International and Intourist in Moscow, Russia. Maryanne holds a Master's degree from the University of Virginia and a bachelor's degree from Loyola College in Maryland. She completed the Stanford Professional Publishing Course at Stanford University. 2
  • Overview National Fourth Quarter and Year End Results $ Invested and # Deals by Quarter Investments by Stage of Development Investments by Industry/Sector First-time Financing PricewaterhouseCoopers Commentary on Results NVCA Commentary on Results Levensohn Venture Partners Frazier Healthcare Ventures MoneyTree Report Q&A 3
  • Thomson Reuters Matthew Toole Research Director, Private Equity Thomson Reuters Matthew Toole is the director of research for Thomson Reuters’ Investment Banking content, which includes mergers & acquisitions, venture capital, private equity and capital markets. Prior to this appointment, Matthew managed Thomson Financial’s capital markets content strategy and development including debt and equity research and banking contributor relations. Matthew started his career as a research analyst in the fixed income group at Thomson Financial Securities Data. Matthew received his Bachelor of Science in Biology from Providence College. 4
  • Investments Decline 8% Over 2007 US Venture Capital Investments: 2001-2008 45 5,000 $40.6 4,500 40 4,000 35 $30.9 3,500 Total Amount Invested ($bil) 30 $28.3 $26.7 Number of Deals 3,000 25 $23.2 $22.5 $21.9 2,500 $19.7 20 2,000 15 1,500 10 1,000 5 500 0 0 2001 2002 2003 2004 2005 2006 2007 2008 Q1 Q2 Q3 Q4 Number of Deals 5 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • Bulk of the $$ Going to Expansion & Later Stage Deals US Venture Capital Investments: 2001-2008 45 40 8.2 35 Total Amount Invested ($bil) 30 25 12.5 10.8 9.9 23.0 20 5.5 9.8 8.8 5.8 15 11.7 10.6 11.5 12.4 10 9.2 8.7 10.1 5 9.4 6.8 6.8 5.3 4.7 4.5 4.2 3.9 0 2001 2002 2003 2004 2005 2006 2007 2008 Seed/Early Stage Expansion Later Stage 6 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • First Sequence Financing accounts for 22% of 2008 venture capital investments 8 30% 7 24.2% 24.8% 25% 23.1% 21.7% 21.6% 6 20.0% Total Amount Invested ($bil) 20.0% % of Investment Dollars 20% 18.3% 5 4 15% 3 10% 2 5% 1 0 0% 2001 2002 2003 2004 2005 2006 2007 2008 Total Amount Invested ($bil) % of Investment Dollars 7 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • Software and Biotech Have Investor’s Interest US Venture Capital Investments By Industry – 2008 IT Investments ($M) $4,918.8 IT $13.3 billion $2,039.0 $1,832.0 $1,650.9 $1,687.9 $644.8 $573.3 Software Media & IT Services Telecom Semiconductors Networking & Electronics & Entertainment Equipment Instrumentation Life Sciences Investments ($M) $4,500.4 $3,459.9 LS $9.5 billion $195.0 Biotechnology Medical Devices & Healthcare Services Equipment 8 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • PricewaterhouseCoopers Tracy T. Lefteroff Global Managing Partner Private Equity & Venture Capital and Life Sciences Industry Services As Global Managing Partner of Private Equity and Venture Capital as well as Life Sciences Industry Services, Mr. Lefteroff is in charge of services provided to the venture capital community, venture-funded technology companies and publicly-held, privately- owned and venture-funded life sciences companies worldwide. Mr. Lefteroff has been key to the development of strategic collaborative agreements with many of the major international pharmaceutical companies and has recently assisted in several high profile industry mergers. He also co-authored the Firm’s Practice Standards and Aids for the Life Sciences Industry. Mr. Lefteroff currently serves on the Board of Directors of the Stanford Venture Laboratory and the California Healthcare Institute. He has served as Treasurer of the Washington State Biotechnology Association, Chairman of the MIT Enterprise Forum of the Northwest and as a Committee Member of the Washington Society of CPA’s High Technology Committee. He is also a member of the American Institute of Certified Public Accountants and the California, Washington and Idaho Societies of CPA’s. Mr. Lefteroff has been with PricewaterhouseCoopers for approximately 16 years, including three years in the Seattle, Washington office, where he was extensively involved with the Firm’s venture capital and life sciences clients. Today he resides in the San Jose, California office. 9
  • Investment Activity – Q4 2008 Top Industries Q4 2007, Q3 2008, Q4 2008 Total Amount Invested ($M) Q4 2007 $1,391 Q3 2008 $1,345 $1,327 $1,300 $1,289 Q4 2008 $1,021 $1,022 $1,005 $1,016 $947 $814 $550 $496 $411 $432 Sof tw are Biotechnology Industrial/Energy Medical Devices and Equipment Media and Entertainment 10 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • Investment Activity – Full-Year 2008 Top Industries 2006, 2007, 2008 Total Amount Invested ($M) 2006 $5,462 $5,028 $5,239 2007 $4,919 2008 $4,594 $4,651 $4,500 $4,069 $3,460 $3,248 $2,924 $1,974 $2,039 $1,956 $1,641 Sof tw are Industrial/Energy Biotechnology Medical Devices and Equipment Media and Entertainment 11 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • Life Sciences Investments 2004 – 2008 Total Amount Invested ($M) $5,239 $4,500 $4,594 $4,267 $4,069 $3,916 $3,460 $2,924 $2,222 $1,936 2004 2005 2006 2007 2008 Medical Devices and Equipment Biotechnology 12 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • Internet-Specific & Clean Tech Investments 2004 – 2008 Internet-Specific Investments ($M) 1,000 $5,015 $4,900 $4,291 800 $3,300 600 $2,904 400 200 0 2004 2005 2006 2007 2008 $ Invested # of deals Clean Tech Investments ($M) 300 $4,115 250 200 $2,666 150 $1,440 100 $550 $444 50 0 2004 2005 2006 2007 2008 $ Invested # of deals 13 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • National Venture Capital Association John S. Taylor Vice President of Research National Venture Capital Association John S. Taylor is Vice President of Research at the National Venture Capital Association (NVCA) which is based in the Washington, DC area. He is responsible for developing and overseeing association data and research efforts. The key element in this effort is the creation of a research consortium which was announced in 1998 involving the NVCA, Thomson Venture Economics, and the Ewing Marion Kauffman Foundation. In December 2001, PricewaterhouseCoopers joined the team and the tri- branded MoneyTree™ survey became the definitive source for venture capital investment information. This team was created to ensure accurate, impartial, durable, and practical data on the venture capital and private equity industries. He joined the NVCA in 1996. Mr. Taylor is frequently quoted by major newspapers and magazines on the subject of venture capital and private equity and has recently provided live commentary on CNBC, CNNfn, Bloomberg radio, and NPR Morning Edition. Mr. Taylor’s career began with the company now known as Accenture where he was a senior consultant advising small business clients. He has since held senior product manager and IT positions in both large and small organizations. At a national computer services provider, he helped develop a new generation of minicomputer and microcomputer products for the residential real estate industry. He has served as a board member of both for-profit businesses and non-profit organizations. In 1998, he was awarded the Maryland Governors Citation for outstanding volunteer service. He recently joined the Advisory Board of the Center for Private Equity and Entrepreneurship at the Amos Tuck School. He received an MBA degree from the Amos Tuck School at Dartmouth College, and a BS degree in chemistry from Dickinson College. 14
  • Number of Deals by Stage US Venture Capital Investments: 2001-2008 5000 4500 545 4000 3500 1207 1177 1014 Number of Deals 3000 488 2388 808 1001 594 2500 1259 1178 2000 1366 1582 1209 1352 1093 1500 1000 1545 1486 1453 1295 1076 1061 500 1022 976 0 2001 2002 2003 2004 2005 2006 2007 2008 Seed/Early Stage Expansion Later Stage 15 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • Number of Deals by Stage US Venture Capital Investments: Quarterly 2006-2008 100% 90% 227 234 235 280 308 320 268 302 273 311 306 334 80% 70% Percentage of Deals 60% 338 306 338 257 273 344 326 289 320 322 360 50% 330 40% 30% 249 306 240 286 226 259 242 245 279 229 231 20% 197 10% 131 109 120 128 120 115 108 86 90 82 84 72 0% Q106 Q206 Q306 Q406 Q105 Q205 3Q05 4Q05 1Q08 2Q08 3Q08 4Q08 Seed Early Stage Expansion Later Stage 16 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • Number of First-Time vs. Follow-On Deals US Venture Capital Investments: 2001-2008 5000 4500 4000 3500 Number of Deals 3000 3264 2653 2500 2637 2474 2136 2000 2172 2255 2167 1500 1000 1299 1213 1201 1171 500 1019 921 836 753 0 2001 2002 2003 2004 2005 2006 2007 2008 First-Time Follow-On 17 PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report Based on data from Thomson Reuters
  • Levensohn Venture Partners Pascal Levensohn Managing Partner and Founder Levensohn Venture Partners Pascal Levensohn has been a finance professional for twenty six years and a venture capitalist since 1996, when he founded Levensohn Venture Partners (quot;LVPquot;) in San Francisco. He invests in early stage software, semiconductor, and communications companies. A frequent speaker on corporate governance issues, Pascal has published numerous articles on venture capital trends since 1999. In May 2006, Pascal established and now chairs the Working Group on Director Accountability and Board Effectiveness, a 33 member VC industry group that promotes director education and best governance practices. The group’s first effort, “A Simple Guide to the Basic Responsibilities of Venture–Backed Company Directors”, was released in January 2007. Pascal co- authored the first governance white paper in the VC industry in November 2003, quot;After the Term Sheet: How Venture Boards Influence the Success or Failure of Technology Companiesquot;. A second white paper, “Rites of Passage: Managing CEO Transition in Venture-Backed Technology Companies”, was published in January 2006. Pascal's VC governance work is now part of the curriculum at several universities, including the Harvard Business School and Stanford's Graduate School of Engineering (Department of Management Science & Engineering). Pascal was elected to the board of the National Venture Capital Association in April 2007, where he serves on the education committee. He currently serves as the Chairman of the San Francisco Jewish Community Federation’s Business Leadership Council and as co-chair of the Steering Committee of the Aspen Institute’s Socrates Society a leadership development program with which he has been involved since 1997. Pascal received a BA in Government from Harvard University and is a graduate of the Lawrenceville School. He is a member of the Council on Foreign Relations and the Pacific Council on International Policy 18
  • Frazier Healthcare Ventures Robert More General Partner Frazier Healthcare Ventures Mr. More joined Frazier Healthcare Ventures in 2008 as a General Partner and is a member of the firm’s biopharma and medical device investment teams. Prior to Frazier Healthcare, Mr. More was a Partner with Domain Associates, having joined the firm in 1996 as a Kauffman Fellow and becoming a Partner in 2000. From 1997- 1998, Mr. More served as the Chief Operating Officer of Small Molecule Therapeutics, a Domain portfolio company subsequently purchased by Morphochem AG. And from 1992 to 1995, Mr. More was with Pharmacia Biotech in sales. Prior to joining Pharmacia, Mr. More held a research position at Somatogen, a company developing a recombinant blood substitute that was subsequently bought by Baxter. While attending business school, Mr. More worked with MedVest, an early-stage venture group in Washington, D.C. Mr. More managed successful investments in and served on the boards of ESP Pharma (acquired by Protein Design Labs, Inc.), Proxima Therapeutics (acquired by Cytyc Corporation), Onux Medical (acquired by C.R. Bard), NovaCardia (acquired by Merck), Esprit Pharma (acquired by Allergan) and IntraLase (acquired by Advanced Medical Optics, Inc.). Mr. More serves as an advisory board member for Montagu Newhall Associates, Okapi Ventures, The Medical Industry Group of the NVCA and The Sulpizio Family Cardiovascular Center. He is also a past founding board member of the Kauffman Fellows Program. Mr. More received his MBA from the Darden School of Business Administration at the University of Virginia and a BA from Middlebury College. 19
  • MoneyTree™ Report Q&A 20