1. the key challenges of ICT
entrepreneurship in Europe
@Digital Agenda Assembly
Brussels, 2013
Credits Saul Klein template
EVCA, AIFI, Klein for data
2. nice to meet you
Class 1967
Università di Torino, drummer/surfer
1995-97 Italia online
97/98 Lycos
99/02 Vitaminic, founder CEO
03/04 Buongiorno Vitaminic, M&A
05/06 Kite-surfing / sabbatical /angel
investor
07/founder and chairman of dpixel
www.dpixel.it
Part time journalist and blogger (Sole
24 Ore / Wired / dgil.uz / CheFuturo)
Kauffman Fellow (KFP Class 14)
Mentor Fullbright, Startup Sauna
(Helsinki)
Teacher @LED Luiss, TechNest/Unical
3. What we do @dpixel:
- Acceleration (Barcamper >1.000 applications)
- Seed fund (9m euro)
- Advisory: Working Capital/Telecom Italia (3k
applications), StartCup Calabria, Sinnova,
YouthPark, NIDI, Digital Energy
4. How does the European innovation
ecosystem looks like?
9. Professor
Edmund
Phelps
Less than 10% of business ideas even get started
Nobel
Prize in
Economics
2006
10k business ideas
1k firms started
100 VC funded
20 IPO
2
market
leaders
10. 55% of US venture capital investments are written
off
50
45
40
35
30
25
20
15
10
5
0
x<0.5
0.5<=x<1
x=1
1<x<2
% Cost
% Value
2<=x<5
x>=5
11. 62% of EU investments are written off
60
50
40
30
20
10
0
x<0.5
0.5<=x<1
x=1
1<x<2
% Cost
% Value
2<=x<5
x>=5
12. But the capital which survives, backs businesses
accounting for 21% of US GDP…..
1978
1981
1987
1995
1995
1997
1999
1999
2005
serving >1bn customers
creating 440k new jobs
with $545bn in new annual revenue
and $1.4tn in new market value
Source: HIS Global Insight
13. In fact if you have something to offer there
are now 3bn people connected to you
4,2 trillion $ market opportunity
14. In Europe we are starting to build waves of similar dimensions
15. And we have a generation with nothing to lose….
16. 0,02% of GDP invested in
venture capital in 2012
(0,17% in the US)
A way of describing the odds: Edmund Phelps, a Columbia economics professor and Nobel laureate, described the odds in his new book, “Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge and Change” as “from 10,000 business ideas, as 1,000 firms are founded, 100 receive venture capital, 20 go on to raise capital in an initial public offering, and two become market leaders.”
According to the venture impact study, IHS Global Insight, originally VC-backed companies accounted for 11.87m jobs and over $3.1 trn in revenue in the US in 2011—accounting for 21% of GDP and 11% of private-sector employment. At Index, our portfolio companies alone have generated $4bn worth of revenue, while growing on average by more than 75%, creating 20k jobs with 1k positions currently openPeople say VC doesn’t add anythign but maybe when we look back on this cambrian explosion of innovation from 1960s (semis) to 2020s (cloud connected services in every sector) – the broadscale application and understanding of venture economics will be the true legacy of venture rather than Apple, Cisco, Facebook, Google, Microsoft, Salesforce, Skype and TwitterDATA: https://docs.google.com/a/indexventures.com/spreadsheet/ccc?key=0ArWfM5OOjmKZdDJ4QWcwcHh5UFZSYm9KSENDRHBONWc&usp=drive_web#gid=0
What did these governments spend in a year on DEFENSE, EDUCATION, HEALTH:See google doc for this data: https://docs.google.com/a/indexventures.com/spreadsheet/ccc?key=0ArWfM5OOjmKZdDJ4QWcwcHh5UFZSYm9KSENDRHBONWc&usp=drive_web#gid=1
€ 3.6bn raised the 2010 fundraising low of the past five years. 102 venture capital funds raised new capital in 2012 compared to 152 in 2011. For the fourth year running government agencies attributed a new high of 40% to venture capital fundraising coming from 33% in 2011.
venture capital invested decreased year on year by 14% to 3.2 bn2900 startups
Seedcamp stats:93 companies since 2007- 83% start-ups raised capital$120m total raised 76 operational6 acquired11 closed850 jobs createdYC stats:511 companies since 2005Average value of a YC-financed start-up is $22.4m37 start-ups have either sold for, or are now worth, more than $40m.If you take last two years of classes out of these numbers (given that it takes time for a company to grow), and you look at 300 companies in YC instead of 511, that means the odds of +$40m success are about 1 in 10.As of 2011, YC had 25 companies of 316 acquired. Of these, 5 exits for over $10 million, and the combined value of the top 21 companies was $4.7bn.TechStars stats:256 companies since 200771% companies funded$400m raised204 operational24 acquired28 failed- 1,882 jobs createdBased on new realities:- Cost of company creation - cloud/SaaS, open source, platforms, Capital efficiency of scale up -> Global markets (talent, customers, finance)YC numbers in 2011: http://ycombinator.com/nums.htmlWAYRA stats: (297 start-ups, €9.7m total investment, 70% commercially trading)
Kickstarter:$810m total dollars pledged49,355 successfully funded projects4.9m total backers1.4m repeat backers11.2m total pledgesFunding Circle: £156m successful loans£39m principal repaid£113m loans outstanding, with 98.5% repayments coming in on time5.8% average net return (before tax)55k people in UK have joined to lend to businessesAngelist: $200m investments$186m through introductions$14m through direct “invest online” product21k investors on platform1,300 companies successfully raised funding
