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Giuseppe Zocco - Index Ventures - Switzerland - Stanford Engineering - Feb 24 2014

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Giuseppe Zocco - Index Ventures - Switzerland - Stanford Engineering - Feb 24 2014

  1. 1. Index Ventures! Monday, February 24, 2014 ! Giuseppe Zocco! Co-founder,! Index Ventures! ! ! European Entrepreneurship & Innovation! Stanford Engineering !
  2. 2. Index Ventures ! –  Active since 1996! –  Geneva, London, San Francisco! –  Active in multiple tech hubs! –  120 companies in 20 countries, 39 cities, employing 20k people worldwide! –  Create (seed), develop (venture), accelerate (growth) ! ! Index Ventures! Stanford Engineering! 2!
  3. 3. Who we look for ! –  European born, building global category leaders! –  US companies with breakout international potential! –  Regional heroes! –  Tech and business model innovation! –  + scalability + originality + missionary + product DNA ! Index Ventures! Stanford Engineering! 3!
  4. 4. Seed  is  the  new  A   Index Ventures! Stanford Engineering! 4!
  5. 5. Seed is the new A! –  Seed is fundamental to a healthy ecosystem! –  It can also produce great rewards e.g. Climate! –  Why we helped start Seedcamp in 2007! –  New models: Angellist, Kickstarter and Funding Cirlce! –  Pushes us to look earlier ! ! Index Ventures! Stanford! 5!
  6. 6. Reshaping  every  sector  of   the  economy   Index Ventures! Stanford! 6!
  7. 7. VC Backed cos are reshaping every sector of the economy! –  Web+cloud+saas+fb=! –  aws+ios+android+hadoop=! –  new frontiers beyond communications / media / entertainment ! –  Agriculture, Healthcare, Financial Services, Education, Work, Fashion ! Index Ventures! Stanford ! 7!
  8. 8. Massive increase in economic relevance of VC-backed companies ! –  Share of economy! –  Share of employment; new employment! –  Index portfolio alone in 2013: ! Generated EUR 4bn revenue! Grew 75%! Created 12k new jobs ! ! Index Ventures! Stanford ! 8!
  9. 9. The US venture opportunity Index Ventures! Stanford! 9!
  10. 10. Index Ventures! Presentation Title Date! Section Title! 10!
  11. 11. European Unicorns 2013! Index Ventures! Stanford ! 11!
  12. 12. VC is a risky business! –  We are all expert at killing deals! –  But need to keep thinking about what could go right?! Index Ventures! Stanford ! 12!
  13. 13. Focus on the game-changers, leads to outsized returns ! Index Ventures! Stanford ! 13!
  14. 14. Risk with reward ! –  Power law: 62% of investments 1x and less but winners are massive! –  For example; ASOS, Climate Corp, Criteo, MySQL, Playfish, Pure Storage, Skype, Supercell! –  …but big exits can take time! Index Ventures! Stanford ! 14!
  15. 15. VC is not a local business! –  Index made 30 early and later stage investments since early 2012! –  + 40 seed deals! Amsterdam   Aachen   Copenhagen   Dusseldorf   Paris   Los  Angeles   San  Francisco   Prague   Helsinki   New  York   London   Index Ventures! Stanford ! Tel  Aviv   Chicago   15!
  16. 16. It’s a global business! Index Ventures! Stanford! 16!
  17. 17. N. American v. European VC! Geographic Split of VC Investment (2013)! $bn Invested in Europe and N. America (2013)! 35   Europe   $4.7bn   11%   30   $bn  Invested   RoW   $3.9bn   10%   $29.5bn   $32.5bn   25   20   15   10   5   $4.1bn   $4.7bn   0   Europe   North  America   2012   2013   No. of Deals in Europe and N. America (2013)! 5,000   4,499   4,000   #  of  Deals   North   America   $32.5bn   79%   4,267   3,000   2,000   1,000   857   1,064   0   Europe   Source: CB Insights! Index Ventures! Stanford! North  America   2012   2013  
  18. 18. European VC is Growing, Relatively! Total $ of Venture Capital Invested Over Time (Rebased to 100)!  350     +215%! $  Venture  Capital  Invested  (rebased  to  100)    300      250     +95%!  200      150      100      50      -­‐         Q1   Q2   Q3   2009   Q4   Q1   Q2   Q3   Q4   Q1   Q2   2010   Q3   Q4   Q1   2011   Europe  Funding   Q2   Q3   2012   Q4   Q1   Q2   Q3   Q4   2013   US  Funding   Source: CB Insights! Index Ventures! Stanford! 18!
  19. 19. Investments Are Across Stages! 2013 VC Investments into European Companies by Stage! 300   $1,200m   $1,106m   250   235   $1,000m   241   $833m   Number  of  Deals   200   $800m   $605m   150   $600m   $490m   $368m   100   69   50   $400m   $237m   69   $200m   $119m   24   4   0   $0-­‐1m   $1-­‐5m   $5-­‐10m   $10-­‐25m   Amount  Invested   $25-­‐50m   $50-­‐100m   2   $100-­‐250m   $0m   No  of  Deals   Source: CB Insights! Index Ventures! Stanford! 19!
  20. 20. And Across Geographies! 2013 VC Investments into European Companies, Top Countries! $1,600m   350   $1,400m   300   250   $1,000m   200   $800m   150   No.  of  Deals   Total  Amount  Invested   $1,200m   $600m   100   $400m   50   $200m   $0m   0   UK   Germany   France   Sweden   Netherlands   Ireland   $  Invested   Italy   Belgium   Spain   Denmark   #  of  Deals   Source: CB Insights! Index Ventures! Stanford! 20!
  21. 21. Types of approaches! –  New entrants attacking entrenched incumbents! –  Lifeline for incumbents! –  New entrants creating a market ! ! Index Ventures! Stanford ! 21!
  22. 22. Embrace Risk ! ! –  It’s a lot cheaper to fail now! –  Too much capital is chasing fast IRR rather than big multiple! –  Focus on enabling innovation! Index Ventures! Stanford! 22!
  23. 23. Index Ventures! February 24, 2014 ! Giuseppe Zocco! Co-founder,! Index Ventures!

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