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Michel Wendell - Nexit Ventures - Finland - Stanford Engineering - Mar 5 2012

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Michel Wendell - Nexit Ventures - Finland - Stanford Engineering - Mar 5 2012

  1. 1. Nexit Ventures 0 Bridging Mobile Opportunities Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  2. 2. Nexit Ventures Michel Wendell 1  Grew up in Finland, spent half my life elsewhere  EE degree  Started businesses from scratch in four countries  Held every corporate job outside of finance and HR  In the Valley since 1996  Entrepreneur – Nexit is my start-up  Cherish life, family, nature, arts, food – hate airplanes and dishonest people Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  3. 3. Nexit Ventures Executive Summary 2  Focus on mobile and wireless – Software, enabling technology, service and content opportunities – The convergence between communication, computing and content  Activities are targeted to the Mobile hot spots – Offices in Helsinki, Stockholm and Silicon Valley – Majority of the investments in the Nordic area – Most of the rest in the US west coast – Networking, business development in China, Korea and Japan  Majority of the capital to be deployed in series B and C financings – Initial investments will be typically done in series A and B financings  Raised about $200M in two funds, fund structure on Guernsey  6 person investment team, all operational and relevant industry background  Hands-on, partnering with the entrepreneurs  Investment size; $500k-$5M, total up to $10M  We invest in people, innovation and market opportunity Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  4. 4. Nexit Strategy Bridging Mobile Opportunities 3 The Nexit Bridge – connecting the mobile hot spots  Bridging Nordic mobile companies to Silicon Valley markets and exit opportunities  Providing US based mobile companies with a Nordic market insight, customer access, and technology resources  Access to lead mobile operators and handset manufacturers in Asia Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  5. 5. Market Overview Mobile & Wireless Market 4 The history of computing can divided into four distinguishable waves  Every wave has lasted roughly 10 years  Each wave has been significantly larger (revenue & market cap) than the previous one  The initial growth has been faster than in any preceding wave  All waves have produced significant new players and generated major wealth for their investors Now the fifth wave – the Mobile Internet – is upon us Source: Morgan Stanley, Nexit Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  6. 6. Market Overview Mobile & Wireless Market 5 Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  7. 7. Mobile Technology Hot Spots Nordic Wireless Knowledge 6  Finland and Sweden on top of the global R&D spending – Sweden and Finland are the only two EU countries spending more than 3 percent of gross domestic product (GDP) on research and development – Investments in knowledge – the sum of investments in R&D, software and higher education – are highest in the United States, Sweden and Finland.  In The Nordic countries high tech business has a strong wireless flavor – R&D skills: The Nordic investment in knowledge is largely focused on mobile technologies and wireless telecommunication, led by companies such as Nokia and Ericsson – Business skills: Individuals leaving Nokia and Ericsson (including the top management) are generating a continuously growing world class quality deal flow in mobile space Eurostat 2006, OECD 2003 Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  8. 8. Hot Spots in Financial World Entry in EU – High Value Exit in US 7 USD $M The Nexit bridge to high value exits 50 47 $M 45  Median entry valuations exit substantially lower in the EU 40 in all VC investment stages 35 30  Median M&A exit valuations substantially higher in the US 25 23 $M 20  Arbitrage: entering with low 15 $M 15 European valuations and exiting entry with high US valuations 10 5 $M 5 0 Median VC pre Median M&A money valuation Europe US valuation Source: DowJones VentureSource Reports Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  9. 9. Hot Spots in Financial World The Acquisition power resides in US 8 North America dominates the high tech market – North America represents 30% of the global GDP but over 60% of the value of public technology companies – North American companies make ~3/4 of high tech acquisitions  Utilizing the North American M&A market is crucial for high tech VC Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  10. 10. Hot Spots in Financial World M&A Activity 9 Source: Capital IQ, SEC, Thompson Reuters, Nexit Ventures. Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  11. 11. Hot Spots in Financial World Wireless M&A Activity 10 Source: Rutberg & Company, Nexit Ventures. Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  12. 12. Nexit Strategy Bridging Mobile Opportunities 11 Flip from Finland to US Flip from Finland to US Partial exit: NTT DoCoMo ~ 75% revenue from US Acquired by ON2/Google US mgmt/bizdev - FIN R&D High Growth, profitable ~ 90% revenue from US Acquired by HP Acquired by nVidia [NYSE:HPQ] Acquired by Sybase [NSDQ:NVDA] [NYSE:SY] Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  13. 13. Strategy Execution Investment Strategy 12 Typical portfolio company profile  Companies with global ambitions and products that can compete globally  Management teams with experience and execution power  Target that over 50% of the companies will be originated from the Nordic area, most of the rest in the US, a few in Asia or Europe  Nexit should contribute concrete added value for the portfolio company: Our deep domain knowledge and global network combined with active hands on involvement can be used to better monitor and further accelerate the development Nexit’s investment strategy execution  Benchmarking the deal flow globally (teams, technology, market opportunity)  Strong involvement in company’s strategy, supporting execution and business development, early international growth  Connecting to global partners and customers for faster growth  Positioning and building networks for international high value exits Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  14. 14. Nordic VC Scene 13 Typical portfolio company profile  Over the past 5 years there has been about $5B in VC investments in the Nordic area in 3700 deals ($32B in VC investment in the US in 2011 in 3200 deals, almost 40% from Silicon Valley)  Roughly 75% of the money in the Nordics came from governmental sources  There are probably 20 active VCs, down from almost 100 in 2000 Deal flow  We see 400-600 mobile/wireless plans per year  50% Nordic, 40% US  We make 0-2 new investments per year Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com
  15. 15. 14 Thank You! Kiitos! Tack! Helsinki Stockholm Silicon Valley CONFIDENTIAL www.nexitventures.com

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