presentation by michele giddens

backing entrepreneurs / delivering financial returns / making a social impact

BridgesVenturesTBLI

November 2007

1

• introduction to Bridges Ventures

• making a social impact

• case studies

• the future

• conclusions


contentsof this presentation


introductionto Bridges Ventures

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Bridges Ventures is a private sector company with a social mission. We make investments that

have the potential to deliver attractive financial returns whilst making a positive social or

environmental impact

We believe that market forces and entrepreneurship can be harnessed to bring social and

environmental benefits as well as making financial returns. Bridges Ventures seeks out

investment that can do well by doing good


introductionour aims

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Bridges Ventures invests in unquoted entrepreneurial businesses with the potential to makestrong financial returns and to have a positive social impact in at least one of two ways:

• regeneration – we invest in ambitious businesses that are located in the mostdeprived 25% of the country and can deliver a strong multiplier effect as they spendmoney and recruit in our these areas.key sectors targeted: leisure and hospitality, consumer, business and consumerservices, manufacturing and distribution

• sustainable business – we invest in businesses whose social impact is not throughwhere they are but through what they dokey sectors targeted: environment, healthcare, education, ethical business


introductionsocial criteria

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2002 Bridges Ventures founded

Bridges CDV Fund I closed at target £40m

social impact focus: regeneration of economically deprived areas

2007 Bridges CDV Fund II closed 50% above target at £75m

social impact focus: regeneration and sustainable business


introductionfunds managed

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founders 3i, Apax Partners, Tom Singh

banks HSBC, Barclays Business Banking, Citigroup, The Royal Bank ofScotland, Lloyds TSB, Lehman Brothers

pension funds West Midlands Pension Fund, South Yorkshire Pensions Authority,Railways Pension Trustee Company Ltd, Gartmore

others Doughty Hanson & Co, All Souls College, Merton College, Reuters,Department of Trade and Industry (Bridges CDV Fund I only),family trusts, high net worth individuals including Jon Moulton andJeremy Coller


introductioncore investors


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introduction – the team

The diverse investment, managerial and entrepreneurial experience of our team enables us to

work closely alongside our portfolio companies to help them thrive and grow. We are active

investors, aiming to provide support and advice to the companies we back, including building

effective boards

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• invested over £37m to date in 33 companies

• supported 75% of the portfolio with further investments

• realised 3 investments to date delivering profit of £12m

• returns to date over 10% above BVCA 2002 vintage average*

introductiontrack record

*source: The Economic Impact of Private Equity in the UK 2006, British Venture Capital Association


making asocial impact

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social screen we set clear social impact criteria of location or sector then use strictlycommercial criteria to select those companies that pass our socialscreen. We are looking for investments that can be winners commerciallyas well as doing good

engagement we work with the companies we back to look for ways to improve theircommunity and environmental impacts while also increasing the value ofthe businesses

reporting we report to our investors on the social impact of the companies we backas well as their financial and commercial performance

making a social impactour three stage process



casestudies

• sold in August 2006 to The DailyMail and General Trust plc for £22m

• £345k invested, £7.5m return

• 165% IRR

• 22x money multiple


financial results

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• over 80 new jobs – majority are womenand ethnic minorities

• >60% of staff came out of unemployment

• raised over £0.5m for charity partnerssuch as MIND, Barnados and the Woodland Trust

• promoted switching to renewable energy

• created an entrepreneurial role model of success

social results

• trade sale to Clondalkin Group

• £730k invested, £2.3m return

• 84% IRR

• 3.3x money multiple


financial results

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• located in Hull, in the most deprived 2%of the country

• company was turned around, saving 50jobs and creating 5 new jobs

• Clondalkin opened a new factory inPoland and aimed to integrate its ownlabel printing operations in Hull

social results

• management are out-performing budget

• 100% occupancy at first 3 buildings

• mature occupancy achieved in less than 4months at all buildings

• gross/ungeared yields of +18%

• roll-out of > 4 new buildings in progress


financial results

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• attracts businesses into our targetareas, bringing strong multiplierimpact

• green roof project with local charityand inner city school

social results


social investmenta growth area?

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• SRI popular and growing in quoted investments

• interest from investors in similar products in other asset classes

• growing consumer demand for ethical products and responsible businesses

• we believe that sustainable private equity / venture capital will be increasingly recognised asan attractive asset class


social investmentdrivers of growth


finalconclusions

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• Bridges Ventures experience to date shows a clear decision making process can deliver

attractive financial returns and positive social impacts

• we see ourselves as sitting in a nascent field of sustainable venture capital, which we

believe is poised for growth

• we believe that investor interest is growing and that this may become a recognised

“asset class”


finalconclusions


appendices

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East of EnglandGreat YarmouthNorwich

East MidlandsAshfieldBassetlawBolsoverChesterfieldCorbyDerbyEast LindseyLeicesterLincolnMansfieldNottingham

LondonBarking and DagenhamBrentCamdenGreenwichHackneyHammersmith & FulhamHaringeyIslingtonLambethLewishamNewhamSouthwarkTower HamletsWaltham ForestWestminster

North East

Blyth Valley

DerwentsideEasingtonGatesheadHartlepoolMiddlesbroughNewcastle upon TyneNorth TynesideRedcar and ClevelandSedgefieldSouth TynesideStockton-on-TeesSunderlandWansbeckWear Valley

North WestBarrow-in-FurnessBlackburn with DarwenBlackpoolBoltonBurnleyCopelandHaltonHyndburnKnowsleyLiverpoolManchesterOldhamPendlePreston

North West (cont’d)

Rochdale

SalfordSeftonSt HelensTamesideWiganWirral

South EastBrighton and HoveHastingsPortsmouthThanet

South WestBristol, City ofCaradonCarrickKerrierNorth CornwallPenwithPlymouthRestormel

West MidlandsBirminghamCoventrySandwellStoke-on-TrentWalsallWolverhampton

Yorkshire and theHumber

Barnsley

BradfordCalderdaleDoncasterKingston upon Hull, City ofKirkleesLeedsNorth East LincolnshireRotherhamSheffieldWakefield

Northern IrelandBelfastCookstownCraigavonDerryDungannonLimavadyMoyleNewry and MourneOmaghStrabane

ScotlandClackmannanshireDundee CityEast AyrshireFalkirkGlasgow City

Scotland (cont’d)InverclydeNorth AyrshireNorth LanarkshireRenfrewshireSouth LanarkshireWest Dunbartonshire

Wales

Blaenau Gwent

BridgendCaerphillyCardiffCarmarthenshireCeredigionConwayDenbighshireGwyneddIsle of AngleseyMerthyr TydfilNeath Port TalbotNewportPembrokeshireRhondda Cynon TafSwanseaTorfaen

Eligible Local Authorities*

*Based on Index of Multiple Deprivation for England and equivalents for the rest of the UK

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portfolio companiesearly stage


name business location date of inv transaction size

motivationalstickers for schoolchildren

West Midlands October 06 £1.5m

insurance brokerspecialising in homeinsurance for the over-50s

Bournemouth March 05 £1.7m

provider of washroomservices

West Midlands £540kAugust 04

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portfolio companiesearly stage



online bookingengines for airlines

London October 03 £2.4m

a virtual secretarial andbilling service for doctors

Nottingham July 06 £751k

re-refiner of waste oil Stoke-on-Trent May 06 £1.5m

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portfolio companiesmanagement buy-outs



designs, manufactures& distributes curtainpoles, blinds &accessories

North London June 04 £5.2m

manufacturer of highperformance, waterproof,breathable, close-fittingsocks and gloves

East AngliaAugust 07 £3.4m

I.T. repair services South East March 07 £7.6m

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portfolio companiesproperty-backed businesses



flexible office space inunder-invested areas

London September 03 £17m

high quality limitedservice hotels

London April 04 £18.4m

roll-out of self storagefacilities across NorthEngland

North-West March 06 £8.9m

indoor real snow skislopes and Alpine village

North-West August 06 £31m

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Team Biographies

Jeremy Philips, Investment DirectorJeremy has 25 years experience in the property sector. He has beeninvolved in a wide range of markets including residential, offices, hotelsand industrial. For 7 years he was a Director of Acquisitions at MWBGroup plc, and prior to joining Bridges, he had his own successfulproperty consultancy.

Sam Archer, Assistant DirectorSam worked as a Chartered Accountant with PricewaterhouseCoopers in theFinancial Services and Real Estate teams. Prior to joining Bridges he helpedrun a small residential property business, gaining useful experience within anSME environment.

Lisa Barclay, Assistant DirectorLisa previously co-founded E-Government Solutions, an e-government softwarecompany. She has also worked as a strategy consultant for MarakonAssociates focusing on the FMCG and financial services sectors, and as aspecial advisor to Government Ministers.

Maggie Loo, AssociateMaggie started her career as a strategy management consultant with McKinsey &Company in New York City. Prior to joining Bridges, she worked at London-basedClimate Change Capital. Maggie studied environmental science and public policyat Harvard University and has an MBA from Columbia Business School.

Antony Ross, Executive DirectorAntony has 14 years of private equity investment in a wide range ofbusinesses from early stage development opportunities to later stagemanagement buy outs. He led 3i’s healthcare team from 2000 to 2001supporting medical technology and biotechnology businesses acrossEurope. Previously he managed 3i’s Newcastle and Cambridge offices.

Carolyn Maddox, Executive DirectorCarolyn has 14 years of private equity investment, previously working at3i as an Investment Controller and then as Director of Causeway Capitaland ABN Amro Private Equity (UK). Prior to joining Bridges Ventures sheworked at Equinox Securities specialising in raising finance for technologycompanies.

Michele Giddens, Executive DirectorMichele has 10 years of international development and communityfinance experience ranging from large equity and debt instruments tomicro-finance and small business lending. She was previously at theShorebank Corporation and was Chairman of the CommunityDevelopment Finance Association (CDFA) 2003-2005.

Philip Newborough, Managing DirectorPhilip has managed 2 VC-backed businesses and a substantial pan-European business. He previously worked at Aiwa as Director and GMand was then appointed MD of MWB Business Exchange, a servicedoffice provider.

Anne-Marie Harris, Assistant DirectorAnne-Marie has 8 years of mid-market corporate finance experience. She waspreviously at Close Brothers Corporate Finance and latterly at McQueen, thespecialist corporate finance advisory business focusing on the leisure, retail andconsumer sectors.

Huw Edwards, AssociateHuw previously worked for Goldman Sachs, starting his career in the CapitalMarkets division where he focused on structuring equity derivative solutions forEuropean corporate clients. He moved on to become an Associate in the FixedIncome, Currencies & Commodities division advising UK corporate clients on howto manage their foreign exchange and interest rate exposures.

Laura Howard, AssociateLaura was previously Operations Director and founder of nude skincare, apremium ethical skincare brand. She has also worked as a strategy consultant forBain & Co. Laura holds an MBA from the Harvard Business School where shefocused on strategy, marketing and social enterprise.

Henry Shelford, Assistant DirectorHenry was previously with awareness Inc., a Walthan USA start-up focused onenterprise web 2.0 solutions. Prior to that he was an executive at Invex Capital.Henry has a degree in Environmental Science from King’s College London andan MBA from the University of Virginia.

Bridges Ventures

1 Craven Hill

London

W2 3EN

t: +44 (0) 20 7262 5566

f: +44 (0) 20 7262 6389

e: [email protected]

www.bridgesventures.com


contact us

Bridges Community Ventures (trading as Bridges Ventures) is authorised and regulated by the Financial Services Authority

presentation by michele giddens

Economy & Finance

social impact focus

positive social impact

social mission

social impact3

social impact4

social impact5

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