V E N T U R E C A P I T A L R E P O R T

Venture Capital Report Europe | 3Q | 2016

V E N T U R E C A P I T A L R E P O R T

VENTURE CAPITAL REPORT

The following report presents Dow Jones VentureSource’s quarterly findings for European venture capital fundraising, investment, valuation, and liquidity. The included charts and graphs offer a comprehensive view of the trends currently affecting the venture capital market.

Highlights for 3Q 2016 include: 

•  European venture capital fundraising declined noticeably from the prior quarter and just slightly compared to the same quarter in 2015;

•  Venture capital investment into European companies decreased significantly from 2Q 2016;

•  The number of mergers and acquisitions (M&As) was one deal lower, but the total amount raised in M&As experienced a significant increase from the previous quarter;

•  The number of initial public offerings (IPOs) remained stable and the total amount raised increased significantly from 2Q 2016.

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EUROPEAN VENTURE CAPITAL FUNDRAISING FALLS IN 3Q 2016

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FUNDRAISING

European VC Fundraising Based on multiple closings (2013–2016) 20 European venture capital funds raised

€1.23 billion during 3Q 2016. Compared with 2Q 2016, total capital raised experienced a significant decline, and the number of fund closings decreased by 17%.

•  Compared with the same quarter last year, euros raised declined by 8%, while the number of fund closings

increased by 18%

•  Northzone Ventures AS, which raised €300 million, was the largest fund of the quarter, accounting for 24% of the total amount raised in 3Q 2016

3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16

Amount Raised (€B) € 0.85 € 2.74 € 1.00 € 1.73 € 1.10 € 1.68 € 1.37 € 2.14 € 1.33 € 1.59 € 2.79 € 2.71 € 1.23

Number of Funds 12 46 24 24 20 28 24 26 17 24 25 24 20

€ 0.85

€ 2.74

€ 1.00

€ 1.73

€ 1.10

€ 1.68

€ 1.37

€ 2.14

€ 1.33

€ 1.59

€ 2.79 € 2.71

€ 1.23

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LARGEST EUROPEAN VC FUNDS RAISED IN 3Q 2016

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FUNDRAISING

Firm Name Fund Name Amount (€M) Location Offering Status Fund Type Fund Category Closing Type

Northzone Ventures AS Northzone VIII € 300.00 Oslo,

Norway Closed Early-stage venture

capital Venture Capital Final

Via Venture Partners Via Venture Partners Fond III K/S € 134.38 Hellerup, Denmark Closed Multi-stage venture

capital Venture Capital Final

Russian Venture Company National Technology Initiative

Fund € 106.74 Moscow, Russia Open Early-stage venture

capital Venture Capital

First

PSA Peugeot Citroen Groupe PSA Fund € 100.00 Paris, France Closed Early-stage venture

capital Venture Capital

Final

Santander InnoVentures Santander InnoVentures Fund €89.77 London, United Kingdom Open Early-stage venture

capital Venture Capital Interim

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INVESTMENT INTO EUROPEAN VENTURE-BACKED COMPANIES DECREASED IN 3Q 2016

European companies raised approximately €2.10 billion from 464 deals in 3Q 2016, a 32% decrease in the amount raised as well as a 3% decline in the number of deals when compared to the previous quarter.

•  Compared with the same period last year, the amount companies raised decreased by 39%, whereas the number of

deals grew by 9%

•  Consumer Services was the strongest sector of the quarter in terms of amount raised, while Business and Financial Services completed the largest number of deals

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FINANCING Equity Financings into Europe-based,

VC-backed Companies (2013–2016)

3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16

Amount Raised (€B) € 1.77 € 2.00 € 1.62 € 2.40 € 2.35 € 2.09 € 2.82 € 3.98 € 3.46 € 3.43 € 2.60 € 3.07 € 2.10

Number of Deals 415 522 427 464 379 439 443 451 425 509 442 478 464

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES, BY ROUND CLASS (2013–2016) – NUMBER OF DEALS

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FINANCING

3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16

Seed 64 81 44 38 32 45 33 47 37 42 42 27 32

First 212 236 224 233 189 211 228 197 204 265 209 251 228

Second 65 88 64 92 67 76 78 78 83 94 97 90 99

Later 50 81 61 77 62 61 78 104 77 75 80 83 72

Restart 0 0 0 0 1 0 1 1 0 1 0 1 0

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES, BY ROUND CLASS (2013–2016) – AMOUNT RAISED (€M)

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FINANCING

3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16

Seed € 25 € 32 € 24 € 24 € 16 € 32 € 31 € 35 € 30 € 32 € 39 € 20 € 45

First € 510 € 512 € 472 € 603 € 488 € 468 € 630 € 567 € 917 € 765 € 707 € 802 € 601

Second € 706 € 411 € 307 € 474 € 220 € 766 € 436 € 919 € 584 € 604 € 770 € 657 € 436

Later € 469 € 988 € 696 € 1,123 € 903 € 778 € 1,650 € 2,303 € 1,876 € 1,581 € 1,072 € 1,559 € 925

Restart € 0 € 0 € 0 € 0 € 1 € 0 € 1 € 1 € 0 € 1 € 0 € 2 € 0

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES (2013–2016) – MEDIAN EQUITY DEAL SIZE (€M)

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FINANCING

3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16

Median Equity Deal Size (€M) € 1.00 € 1.17 € 1.30 € 1.50 € 1.50 € 1.71 € 1.79 € 2.11 € 2.00 € 2.00 € 2.18 € 2.00 € 2.00

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES, BY INDUSTRY GROUP (3Q 2016)

Consumer Services received the largest allocation of investment during 3Q 2016, raising €776.30 million through 126 deals. The sector attracted 37% of the total amount invested and a 27% share of all deals completed in the quarter.

Business and Financial Services ranked second in terms of euros invested. The sector garnered €452.87 million across 127 deals, a 2% decline in the number of deals and 36% drop in the amount invested when compared with 2Q 2016.

Information Technology placed third, receiving €387.70 million via 120 deals. The sector’s investment figure represents 19% of the total equity financing into European VC-backed companies for 3Q 2016.

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FINANCING 3Q'16 Industry Breakdown By Number of Deals

3Q’16 Industry Breakdown By Amount Raised

27%

3%

27% 2%

12%

1%

26%

Business and Financial Services

Consumer Goods

Consumer Services

Energy & Utilities

Healthcare

Industrial Goods & Materials

Information Technology

22%

2%

37% 3%

15%

2%

19% Business and Financial Services

Consumer Goods

Consumer Services

Energy & Utilities

Healthcare

Industrial Goods & Materials

Information Technology

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TOP 5 DEALS INTO EUROPEAN VC-BACKED COMPANIES (3Q 2016)

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Co. Name Location Industry

Code Industry Segment

Industry Group

Brief Description

Close Date

Round Type

Raised (€M)

Round Investors (* denotes lead)

Roofoods Ltd. (Deliveroo)

London, United

Kingdom

Shopping Facilitators

Consumer Information Services Consumer Services

Provider of a food delivery platform.

05/08/2016 5th € 245.02 Bridgepoint Advisers Group Ltd.*, Digital Sky

Technologies Ltd.*, Felix Capital, General Catalyst Partners*, Greenoaks Capital Management LLC

GoEuro Corp. Berlin,

Germany Shopping

Facilitators Consumer

Information Services Consumer Services Provider of a travel planning

platform for different types of transportation.

30/09/2016 5th € 62.74

Atomico, Battery Ventures, Goldman Sachs Group Inc., Kleiner Perkins Caufield & Byers*, Lakestar LP, New Enterprise Associates Inc., Silver Lake

Management LLC*

Heliatek GmbH Dresden, Germany Power Supplies

Electronics and Computer Hardware

Information Technology Developer of organic solar cells. 21/09/2016 5th € 42.00

AQTON SE, BASF Venture Capital GmbH, BNP Paribas SA, eCAPITAL entrepreneurial Partners AG, Engie SA, High-Tech Gruenderfonds Management GmbH, Innogy Holdings*, Innogy Venture Capital

GmbH, Lampe Beteiligungsgesellschaft, TU Dresden

iOmx Therapeutics AG

Munich, Germany

Biotechnology Therapeutics Biopharmaceuticals Healthcare

Provider of cancer therapeutics based on novel immune

checkpoint targets. 22/09/2016 First Round € 40.00

Merck Ventures BV, MPM Capital*, Sofinnova Partners*, Wellington Partners

InflaRx GmbH Jena,

Germany Biotechnology Therapeutics Biopharmaceuticals Healthcare

Developer of therapeutics in the field of inflammation.

21/07/2016 4th € 31.00 Beteiligungsmanagement Thuringen GmbH, Staidson Hong Kong Investment Company*,

Undisclosed Investors

FINANCING

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MOST ACTIVE INVESTORS FOR EUROPE-BASED, VC-BACKED COMPANIES (3Q 2016) BY DEALS COMPLETED

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FINANCING

10 10

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High-Tech Gruenderfonds

Management GmbH

Bpifrance Investissement SAS

Global Founders Capital

SOSV ALMI Invest Bayern Kapital GmbH

Kima Ventures Sunstone Capital A/S

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EQUITY FINANCINGS INTO EUROPE-BASED, VC-BACKED COMPANIES BY COUNTRY (3Q 2016)

The United Kingdom remained the most favoured destination for equity financing during 3Q 2016, receiving €737.96 million across 112 deals. The country attracted 35% of all equity financing in 3Q 2016.

Germany, ranked second, raised €525.71 million through 74 deals. Despite a 5% decrease in capital invested and a 9% drop in the number of deals from last quarter, Germany still garnered a 25% share of all European financing in 3Q

2016.

France occupied third position raising €269.36 million, or 13% of the total amount raised for the quarter. Ireland placed fourth based on raising €89.58 million during 3Q 2016.

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FINANCING Number of Deals in 3Q 2016 by Country (Top 4)

Amount Raised in 3Q 2016 by Country (Top 4)

23%

19%

23%

15%

15% 7%

40%

United Kingdom

Germany

France

Spain

Rest of Europe

35%

25%

13%

4%

23% United Kingdom

Germany

France

Ireland

Rest of Europe

V E N T U R E C A P I T A L R E P O R T

EUROPE 3Q 2016 VENTURE EXIT ACTIVITY

53 venture-backed M&As took place in Europe during 3Q 2016, a 2% decrease from 2Q 2016. However, the number is 10% higher than that of 3Q 2015.

The total amount raised through European VC-backed M&As in 3Q 2016 was €4.24 billion. This represents a 21% increase from the previous quarter and a 90%

increase from the same quarter last year.

10 venture-backed IPOs took place during 3Q 2016, the same figure as in 2Q 2016 and a 25% increase from 3Q 2015.

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LIQUIDITY

Exit Opportunities for European VC–backed Companies (2013–2016)

0 10 20 30 40 50 60 70

3Q'13

4Q'13

1Q'14

2Q'14

3Q'14

4Q'14

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

2Q'16

3Q'16

3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16

IPOs 3 9 9 21 16 10 12 17 8 15 5 10 10

M&As 43 44 56 43 51 50 56 45 48 39 51 54 53

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TOP 3 M&As IN EUROPE (3Q 2016)

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Company Name Location Brief

Description Industry

Code Industry Segment Industry Group Close Date

Round Type

Amount Paid (€M) Acquirer

O3B Networks Ltd.

St. Helier, United Kingdom

Provider of global satellite services.

Wireless Telecommunications Service Providers

Communications and Networking

Information Technology 01/08/2016 Acquisition € 650.42 SES SA

Enablon SA Courbevoie,

France Provider of sustainability

management software solutions.

Business Applications

Software Software

Information Technology 01/07/2016 Acquisition € 250.00 Wolters Kluwer

MyOptique Group Ltd.

London, United Kingdom

Provider of products and accessories for the eyewear

market. Specialty Retailers Retailers Consumer Services 30/09/2016 Acquisition € 140.00

Essilor International SA

LIQUIDITY

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EUROPEAN VC-BACKED IPOs (2013-2016)

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LIQUIDITY

The number of IPOs during 3Q 2016 remained stable in comparison to the prior quarter, whereas the amount raised increased significantly.

10 venture-backed companies went public during 3Q 2016, the same number as in the prior quarter.

IPOs raised €257.83 million during 3Q 2016, a growth of 40% from the €184.48 million raised in 2Q 2016.

The largest European VC-backed IPO of 3Q 2016 was Talend SA. The company raised €84.83 million for its

offering on NASDAQ.

3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16

Raised (€M) through IPO € 25.51 € 366.10 € 691.24 € 529.53 € 447.47 € 2,249.97 € 417.40 € 576.70 € 699.69 € 609.55 € 110.05 € 184.48 € 257.83

Number of IPOs 3 9 9 21 16 10 12 17 8 15 5 10 10

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TOP 3 IPOs IN EUROPE (3Q 2016)

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LIQUIDITY

Company Name Location Brief

Description Industry

Code Industry Segment Industry Group Close Date

Raised through IPO (€M)

Exchange/ Symbol

Talend SA France Provider of open source data

integration software. Communications

Software Software Information Technology

28/07/2016 € 84.83 NASDAQ: TLND

AC Immune SA Switzerland Developer of therapeutics for neurodegenerative diseases.

Biotechnology Therapeutics

Biopharmaceuticals Healthcare 23/09/2016 € 59.16 NASDAQ: ACIU

GenSight Biologics SA France

Developer of therapies for mitochondrial and

neurodegenerative diseases of the eye and central nervous system.

Biotechnology Therapeutics Biopharmaceuticals Healthcare 13/07/2016 € 40.00 Euronext: SIGHT

V E N T U R E C A P I T A L R E P O R T

ABOUT US & METHODOLOGY

Dow Jones VentureSource helps venture capitalists, corporate development executives, investment bankers and service providers find deal and partnership opportunities, perform comprehensive due diligence and examine trends in venture capital investment, fund-raising and liquidity. It provides accurate, comprehensive data on venture-backed companies – including their investors and executives – in every region, industry and stage of development throughout the world.

The investment figures included in this report cover venture backed companies headquartered in Europe, and are based on aggregate findings of Dow Jones’ proprietary research for VentureSource.

This data was collected through surveys of professional firms, interviews with company executives, and from secondary sources. To be included, companies have to receive financing from a venture capital or private equity firm. Our figures do not include companies that have received funding solely from individual, corporate and/or government investors. The data in this report only accounts for equity funding, not convertible debt deals.

Figures contained throughout the report are current at time of editorial but subject to change without notice. No statement herein is to be construed as a recommendation to buy or sell securities or to provide investment advice.

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