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Mario Orasche - Eagle Ventures - Stanford - Feb 8 2010

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Talk on the state of venture capital in southeastern Europe, with a focus on the Balkans.

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Mario Orasche - Eagle Ventures - Stanford - Feb 8 2010

  1. 1. Venture Capital in Central and Southeast Europe<br />Mario Orasche<br />Managing Partner & Founder, Eagle Ventures<br />European Entrepreneurship and Innovation Thought Leaders,<br />Stanford Engineering<br />February 8, 2010<br />
  2. 2. History of the RegionA brief review of about 16 centuries<br />Honey and blood over centuries in the Balkans<br />Bal = Honey<br />Kan = Blood<br />Byzantine Empire or Eastern Roman Empire (330-1453)<br />A pan-regional symbol: the double-headed eagle<br />Sarajevo, Bosnia 1914:<br />Assassination triggers WW I.<br />As of 19th Century<br />The Austrian / Austro-Hungarian Empire is prevailing until WW I.<br />
  3. 3. Central and Southeast Europe (‘CSE’) TodayIt remains complicated<br />Wars, pain and suffering prevail throughout the 20th century<br />Kingdom of Yugoslavia or Serbs, Croats and Slovenes (1918-1941)<br />EU Enlargement Process (Today)<br />US, UN, NATO, EU Peacekeeping forces inBosnia and Herzegovina (1995-2010)Kosovo (1999-2010)<br />Yugoslav Wars and NATO bombing of Bosnia (1991-2001)<br />
  4. 4. Emerging VC Landscape<br />High potential region, weak innovation ecosystem<br />CSE vs. CA <br />Huge untapped investment opportunity<br />Hungary: Pharma / Biotech<br />Slovenia: <br />RF technology<br />Romania: <br />IT, Pharma<br />Croatia: Chemistry, Telecom<br />Bulgaria: Electronics,<br />Semiconductors<br />Bosnia: Energy Generation,<br />Automotive<br />Serbia: <br />Computer Engineering, Programming<br />Macedonia:ICT Outsourcing <br />Montenegro: Energy Generation<br />* CSE in terms of Eagle Ventures’ focus region: BG, BIH, HR, HU, MK, MNE, RO, SLO, SRB <br />** Eagle Ventures is the first multinational tech VC dedicated to CSE<br />Page4<br />
  5. 5. Major Changes Over Last Decade<br />Environment NOW ready forVC investments<br />© <br />The CSE landscape has improved markedly for technology firms over the last several years<br />Other factors include:<br /><ul><li> Surge in purchasing power
  6. 6. Managerial skill sets
  7. 7. Technology centers / parks
  8. 8. M&A gaining traction</li></li></ul><li>ICT Indicators<br />Recent significant improvements<br />Strong and still growing ICT access indicators<br />* CSE in terms of Eagle Ventures’ focus region: BG, BIH, HR, HU, MK, MNE, RO, SLO, SRB <br /><ul><li> Household Internet penetration soared 4.6 times within 5 years (now close to 40%)
  9. 9. Mobile phone penetration grew about 3 times to > 100%</li></li></ul><li>Investment Activity<br />VC barely existent<br />Funds raised in 2008: €2.5 Bn (VC&PE)<br />Vast majority still into PE, although number of VC deals augments<br />€0.2Bn<br />vs. $28.6Bn, USA<br />Source: NVCA<br />Source: EVCA, 2008 (comprises entire Eastern Europe)<br />12 deals<br />CA: <br />- 1,137 VC Deals<br /><ul><li> $8.9 Bn</li></ul>Source: NVCA, 2009<br />43<br />46<br />Source: EVCA, 2008 (comprises entire Eastern Europe)<br />
  10. 10. Sectors<br />Eastern Europe vs. Silicon Valley<br />Besides Life Sciences, other high-tech sectors still lag behind in Eastern Europe<br />Source: EVCA, 2008 (includes PE investments)<br />Source: NVCA 2009, PWC Moneytree Report (VC only)<br />
  11. 11. LP Landscape<br />Not too different from the US<br />Limited investor landscape for emerging VCs<br />(€2.5 Bn, includes PE)<br />Source: EVCA, 2008<br /><ul><li> Top LPs are FoFs, Pension Funds and Other Sources
  12. 12. Endowments and Foundations are of significantly higher importance in the US </li></li></ul><li>Introduction to Eagle Ventures A Novel Approach<br />Unique investment focus and strategy generates high return potential<br />TRIPLE FOCUS<br />2<br />1<br />3<br /> CSE Region<br /><ul><li>Tier 1: Former Yugoslavia(Bosnia, Croatia, Macedonia, Montenegro, Serbia and Slovenia)
  13. 13. Tier 2: Bulgaria, Hungary and Romania
  14. 14. Selectively anywhere if there is a clear CSE connection</li></ul> Technology Sectors<br /><ul><li>Digital Media
  15. 15. Software & IT
  16. 16. Electronics
  17. 17. Greentech</li></ul> Early Stage<br /><ul><li>Primarily A and B investment rounds
  18. 18. Selectively, seed or late-stage venture
  19. 19. Co-investments with value adding VCs and co-investors
  20. 20. Started with €10 Mn cornerstone commitment, Abanka, Slovenia
  21. 21. Made first investment in leading-edge live video streaming platform
  22. 22. Continue fundraising in Europe and US, Fund target size €40-65 Mn ($100 Mn cap)</li></li></ul><li>Management TeamStrong VC, entrepreneurial and tech background<br />Tech Exit Value, $1.5 Bn<br />Profound local knowledge and sound tech VC track record<br />Tech Investment Value, $200 Mn<br />Mario Orasche, <br />Ljubljana, Slovenia <br />Entrepreneurial Experience<br />George Sarcevich, <br />Belgrade, Serbia<br />Corporate Experience<br />Ivan Vrdoljak,Zagreb, Croatia<br />
  23. 23. Eagle Ventures<br />West Coast approach – unique in CSE<br />Supervisory Board<br />Bostjan Heric<br />Tone Pekolj<br />Christian Schopper<br />Venture AdvisorsAdvice on Investment / Divestment Decisions<br />FUNDNew Europe Tech I<br />Modeled after West Coast VC organizationsto leverage knowledge and execution<br />Fund Management Company<br />Alon Adler<br />Alan Barrell<br />Peter Globokar<br />Mario Orasche<br />George Sarcevich<br />IvanVrdoljak<br />Nino Marakovic<br />Peter Zaboji<br />Managing Partner, SRB<br />Managing Partner, HR<br />Managing Partner, SLO<br />Investment Manager II<br />TBA<br />Vladimir Delic<br />Damjan<br /> Lampret<br />Portfolio Companies<br />Analyst, SRB<br />Tech Expert, SLO<br />Analyst, HR+SRB<br />2<br />3<br />4<br />5-15<br />1<br />Crucial Venture Capital Skill Sets<br />Venture Capital + Technology + Finance + Operations<br />Venture PartnersHands-on Management Support to Portfolio<br />Zdenek Bilek<br />Karl Heinz Messer<br />Dragan Pleskonjic<br />DamirSabol<br />Peter Szlavik<br />Domen Verdnik<br />
  24. 24. First Portfolio Company<br />Leading global player in real time video streaming<br /><ul><li>HQ Bay Area, top engineering team in Slovenia, Founded in 2008
  25. 25. Revenues $1 Mn
  26. 26. Headcount 20
  27. 27. Strategic partnership with Alcatel-Lucent
  28. 28. Customers:
  29. 29. Preparing financing round with Silicon Valley investors</li></ul>Offers a unique 2-way (up and down), 3-screen (mobile, web and broadcast) live video streaming platform<br />www.livecliq.net<br />
  30. 30. Contact<br />Thanks <br />Mario Orasche<br />Managing Partner, Founder <br />EAGLE VENTURES<br />mario@eaglevc.com<br />www.eaglevc.com<br />

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