Baltic Private Equity and Venture Capital MarketMarket Overview: 2017

8JEREMIE (Joint European Resources for Micro to Medium Enterprises) is a joint initiative launched by the European Commission (DG Regional Policy) and the European Investment Bank group to improve access to finance for SMEs in the EU within the Structural Funds framework for the period 2007-2013. Hence, private equity and venture capital funds which carry out the activities under the JEREMIE initiative in Lithuania is financed from the EU Structural Funds under 2007-2013 Economic Growth Operational Programme of Lithuania.9Total Fund size

Baltic private equity and venture capital landscape & BIF

70,0M EUR9

72,7M EUR9

43,0M EUR9

40,0M EUR9

Early Late Early Late Early Late

Seed Start-up Growth Buyout1

Stage of VC / PE Investment

1Turnaround, Maturity, MBO, LBO, Sale, etc.2ERDF 2014-2020 funds

4Reflows / National funding5ERDF 2014-2020 funds6Expected Fund size 20.0M EUR

Start-up funding

Private Equity funds

VC funds

Start-up funding & VC funds

Karma Ventures Fund

6th Fund

Livonia Partners Fund

16,2M EUR2

14,5M EUR2

13,8M EUR2

Fund size 130,0M EUR

Baltic Innovation Fund (BIF)

Fund size 58,8M EUR

New VC/PE Instruments in the Pipeline

EUR 253,5M253,5M253,5M private investor monies expected to be attracted by the end of BIF lifecycle private investor monies expected to be attracted by the end of BIF lifecycle private investor monies expected to be attracted by the end of BIF lifecycle private investor monies expected to be attracted by the end of BIF lifecycle private investor monies expected to be attracted by the end of BIF lifecycle private investor monies expected to be attracted by the end of BIF lifecycle private investor monies expected to be attracted by the end of BIF lifecycle private investor monies expected to be attracted by the end of BIF lifecycle private investor monies expected to be attracted by the end of BIF lifecycle253,5M private investor monies expected to be attracted by the end of BIF lifecycle253,5MEUR 121,7M from pension funds from pension funds from pension funds from pension funds from pension funds121,7M from pension funds121,7MEUR 84,6M invested in companies to date (May 2017) invested in companies to date (May 2017) invested in companies to date (May 2017) invested in companies to date (May 2017) invested in companies to date (May 2017) invested in companies to date (May 2017) invested in companies to date (May 2017)84,6M invested in companies to date (May 2017)84,6M

81,5M EUR9 BaltCap Private Equity Fund II

New VC/PE Instruments in the Pipeline

10,2M EUR2

Selected fund managers

Lithuania SME Fund

25,0M EUR9

20,0M EUR9

8,0M EUR9

20,0M EUR9

Fund size 58,5M EUR

Business Angels Fund I (2015 12 31)8,4M EUR9

15,7M EUR9

UAB Robos Capital

UAB „Kofinansavimas“

UAB „Kofinansavimas“

13,8M EUR6

11,0M EUR4

9,3M EUR5

Development Fund I 3

Co-Investment Fund (Year 2021) 7

Co-Investment Fund II (Year 2023) 7

Venture Capital Fund I (2018 – 2022) 7

(end of year 2017, but may be extended until end-2018) 7

Development Fund II 3

Business Angels Co-Investment Fund 3

Venture Capital Fund II 3

3The selection of Fund managers is undergoing

7End of Investment period

Practica Seed Capital (2016 12 31) 7

Practica Venture Capital (2016 12 31)7

7

LitCapital I (2016 01 01) 7

(2021 July) 7 (not a Jeremie fund)

JEREMIE Holding Fund & other market players 8

(not a Jeremie fund)

Baltcap Growth Fund (Q2 or Q3 2022)7

(Q1 2019) 7

(Q3 2020) 7

(Q3 2021) 7

(Q4 2019) 7 BPM Mezzanine Fund

JEREMIE private equity and venture capital funds activity report

FundraisingFundraising of VCA members, EUR M

Cumulative fundraisingCapital attractedGPs commitment

0,41 0,29

22,83

1,015,95

0,270,03 0,89 1,03 1,13 1,13

48,1 48,4

72,1 74,281,3 82,7 85,7

2010 2011 2012

2,07 0,86

20162013 2014 2015

47,7

Investment

0,20

7,04 8,71 10,77

16,79

11,23

0,20 7,24

15,95

26,72

43,51

54,73

2010 2011 2012 2013 2014 2015

6,03

60,76

2016

0,10 0,70 0,46 0,430,41 0,84 0,94

2 10 19 1426 20 12

Funds invested, EUR M

Cumulative investmentCapital investedAverage investmentNumber of new companies

Top 5 Lithuanian PE Deals 2010 - 2016

Investment

1.17

49%(30.45)

Value of investments (EUR M and % of total) # Of investment

0.15

0.19

0.49

10%(6.17)

39%(23.99)

2%

The average investment value for all stages is at 0.51M EUR. Lithuanian funds are limiting their maximum investment into one company at 3M EUR, as is imperative by structural funding requirements by EU*.

*(2007 – 2013)

Lithuanian funds are allocating most of its funds into companies that already have an established revenue and client bases. Investments in seed stage companies are frequent, yet significantly smaller (average investment of 0.15M EUR).

(1,3)

Average investment (EUR M)

Growth Turnaround Seed Start-up

26

7

40

49

20162015201520112010

Providence Equity Partners acquired TV3 and other Baltic media businesses from Modern Times Group at EV of 115MEURHubert Burda Media, Accel Partners, Insight Venture Partners acquired Vinted for 25MEURProvidence Equity Partners acquired Bitė from Mid Europa Partners

Valeant Pharmaceuticals acquired Sanitas from Invalda, Citi VC funds and other shareholders for 270MEURThermo Fisher Scientific acquired Fermentas, a major biotech company, from Summit Partners and other shareholders for reported 260MUSD

Capital invested by county

2,4

6,4

34,38,0

1,0

1,5

1,5

0,30,4

Panevėžys

Šiauliai

Vilnius

Kaunas

Tauragė

KlaipėdaTelšiai

Marijampolė

Alytus

Investment

Industrial and business products1

Consumer goods and retail2

Consumer services3

Communication4

Energy and environment5

Business and industrial services6

Computer and consumer electronics7

Financial services8

Transportation9

Chemicals and materials10

Construction11

Other12

investments(EUR M, 2010-2016)

Industry investments(# of companies, 2010-2016)

15,5

8,3

7,8

6,9

5,8

5,4

4,6

1,2

0,4

0,3

0,014,6

16

16

6

36

6

10

15

4

1

1

13

Average investment (EUR M)

1

2

3

4

5

6

7

8

9

10

11

12

0.97

0.52

1.31

0.19

0.97

0.54

0.31

0.30

0.43

0.30

0.01

1.53

Consumer goods & services

ICT (Communications, computer and electronics)

Business products & services

Biotech & healthcare

Energy & environment

Financial & insurance activities

Chemicals & materials

Construction

Unclassified

Transportation

Real estate

Agriculture

28,220,119,811,35,55,23,22,1

21,40,90,4

Investments(EUR M, 2010-2016)

Industry

Investments(# of companies, 2010-2016)

26,518,934,3

0,39,51,90,50,07,20,70,00,0

26,518,934,30,39,51,90,50,07,20,70,00,0

19,144,422,60,95,23,50,90,91,7

0,90,00,0

# Of investment Average investment (EUR M)

Value of investments (EUR M, 2010-2016)

Šiauliai

Tauragė

Alytus

Panevėžys

Marijampolė

Kaunas

Telšiai

Vilnius

Klaipėda

1,61,51,51,21,00,50,40,40,2

41121

161

892

Investment (European Private Equity vs Lithuanian Private Equity)

Europe Lithuania

Number of employees in the portfolio (since investment)

The average annual increase of the number of employees within the portfolio company when comparing the number of employees in the company a day before investment and after up to 4-5 years of the PE/VC investment is 26%. The employ-ment growth within the portfolio company across the di�erent investment stages of the fund varies between 17 – 34%. 14 718

1280 1543 1768

2790 3048

2010 2011 2012 2013 2014 2015 2016

Providence Equity Partners acquired TV3 and other Baltic media businesses from Modern Times Group at EV of 115MEURHubert Burda Media, Accel Partners, Insight Venture Partners acquired Vinted for 25MEURProvidence Equity Partners acquired Bitė from Mid Europa Partners

Valeant Pharmaceuticals acquired Sanitas from Invalda, Citi VC funds and other shareholders for 270MEURThermo Fisher Scientific acquired Fermentas, a major biotech company, from Summit Partners and other shareholders for reported 260MUSD

Total Turnover (EUR M)

Active Portfolio Companies

16

3159Total Employees

84.60M already invested in 16 companies

EXPECTED TOTAL FUND SIZE 383.5M

Private Investors 253.5MBaltic Innovation Fund of Funds 130.0M

52MEIF

26MLT

26MLV

26MEE

Livonia Partners Fund

BaltCap Private Equity Fund II BPM Mezzanine Fund

Karma Ventures Fund

Baltcap Growth Fund

6th Fund

30M15M 25M 20M20M 20M 30M25M 30M55M61.5M 52M

121.70M of those, Pension funds

BIF portfolio (data as of end 2017 Q1 on companies)

Phone: +370 525 46713Mail: info@vca.ltFax: +370 525 46978

This material published and prepared by solely the Lithuanian private equity and venture capital association (LT VCA) for member firms, portfolio companies andpublic who find the findings being useful. It must not be reproduced or disclosed without prior consent. Whilst every e�ort has been made, the LT VCA cannot guarantee the accuracy of the information contained herein.This publication has been prepared for general guidance on matters of interest only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice.

BIF capital structure (data as of end 2017 Q1 on companies)

Waste management services

Real estate services

Health services

Automation of financial processes

Waste management services

Industrial equipment rental

Business services

Online IT&electronics purchasing platform for corporate buyersEye care chain

Paint producer

Data center services provider

Manufacturing of saunas and thermal wood productsSpecialized retail

ICT

ICT

ICT

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

Poland

Poland

Primarily Europe

Primarily Europe

UK

Finland

Apr-14

Sep-15

Nov-15

Jan-16

Jan-16

Jan-16

Mar-17

Mar-16

May-16

Sep-16

Oct-16

Mar-16

Nov-16

Nov-16

Dec-16

Q1-17

Karma Ventures Fund

BPM Mezzanine Fund

BaltCap Private Equity Fund II

Livonia Partners Fund

Fund IndustryGeography of jobs/taxes

LV LT EE OtherInvestment date

X

X

X

X

X

X

X

X

X

X

X

X

EE

Poland

Poland

Primarily Europe

Primarily Europe

UK

Finland

Other

X

X

X

X

X

X

X

X

LV

X

X

X

X

X

X

X

LT

Total invested (EUR M)

Investments in 2016 (EUR M)

AUM (EUR M)

46,1

257,3

307,2

84,6