| European Venture Capital |
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| Saturday, 08 September 2007 06:34 | |
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European venture capital investment in the second quarter of 2007 rose 5% to 1.14 billion euros from the first quarter. However, due to bigger sized deals in early stage investments, the number of deals was down 20% to 213. The second quarter venture capital investment results were significant in terms of early-round investment, where as much as 600 million euros (about 42.8% of the total capital) were invested in 126 early round deals (which comprised more than half of the total number of deals). The median amount investment of 3.2 million euros in a first round deal for the second quarter was accordingly the highest on record. Moreover, “continued interest in later-stage deals” has pushed the overall median for a European venture capital deal 41% for the second quarter to the highest amount of 3.1 million euros. Industry-wide, year-on-year investment was up but the number of deals was down. Healthcare companies saw the biggest change with 10% more in capital investment, from 265 million euros for the same quarter in 2006 to 265 million euros in 2007. However, the number of deals for the sector was down 34% to 41 from 62 deals in the second quarter of 2006. Twenty-seven deals in biopharmaceutical companies comprised 66% of total investments for the sector. The number of deals for biopharmaceutical companies for the second quarter of 2007 was down 13% year-on-year while capital investments were up 24%. Medical devices saw a big drop of 48% in the number of deals of only 12 rounds and a drop in capital investments as well with only 45 million euros raised in venture capital. Information technology companies took in the biggest amount of capital investment worth 690 million euros, a 3% increase over the amount invested in 2006, making the record of the biggest quarterly investment for the European information technology companies in five years. The number of deals for the sector however for the second quarter was down 12% compared to the 156 deals completed in the first quarter. Venture capitalists for semiconductors raised 127 million euros, the highest quarter results since the third quarter of 2001. Nine later-stage companies raised more than 98 million euros, a ten-fold increase versus the same period in 2006. WLAN chip-maker Nanoradio, a Swedish company raised 22.5 million euros in later-state financing for the second quarter of 2007. A significant increase in deals was in information services on the web, which includes “blogs, social networks, wikis and other Web 2.0 technologies”, the most number of deals for the sub-sector since 2002 with 42 rounds. However, the total capital raised for web companies was just over 127 million euros, down 38 percent compared to the second quarter of the previous year. Joost, an Internet TV raised 33 million euros from established venture capitalists such as Index Ventures and Sequoia Capital as well as Hutchison Whampoa Ltd. ( HUWHY) Chairman Li Ka Shing, and content providers Viacom Inc. (VIA) and CBS Corp. (CBS). By country analysis, the United Kingdom still pulled in the most deals and amount of investments for the second quarter, with 61 rounds and 299 million euros, albeit a decline of 15% and 20%, respectively year-on-year. France’s second quarter venture capital and deals on the other hand rose 15% at 54 and 20% at 206 million euros, respectively. The first six months of 2007 saw France’s venture capital investments of 513 million euros growing to its biggest since 2001. A trend in which venture capitalist are putting in more capital to fewer companies so that these companies could “compete better globally and build critical mass is behind the “record median round size in Europe” for the second quarter of 2007. article by: arjun sethi Full Bibliography & Article Available: Download Here |