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European Venture Capital.

The Facts.

Patric Gresko

European Investment Fund

SEP Investors Forum Workshop, 25.03.2015

European Investment Fund.

Venture Capital activities.

European Venture Capital. The Facts. Patric Gresko. European Investment Fund. 2

” “

~€5bn Of

Investments

in European

Venture

Capital funds

260+ Venture

Capital funds

Europe’s Leading Developer of

Risk Financing for

Entrepreneurship & Innovation

3800+ Companies

18 Years

On European

Venture

Capital

market

EIF: an increased support to the

VC market…

3 European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

0

100

200

300

400

500

600

700

800

900

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

EIF's Commitment (EURm)

Avg: EUR 400m

Avg: EUR 220m

?

… and not only financially

4

More demanding and

more flexible T&Cs

New tools in the

toolbox:

• TTA

• EAF

• SIA

• Co-investments

• CoriP

• 1st closing size

• EIF relative commitment

• Better alignment of

interests

• Alternative fee and carry

schemes

• …

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

The European VC market:

mythos and reality

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The reality:

European Venture capital has

become a very compelling

investment opportunity

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

Key trends in EIF’s Venture capital

portfolio in 2014

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Double digit IRRs for

vintages 2007-2009

Oversubscribed funds

15 exits with

valuations above

$100m

generating

~$10bn of exit value

55.8% 21.3%

19.5% 26.7% 19.1%

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

It’s going North…

7

90

95

100

105

110

115

120

125

130

135

Performance Index - Rebased as of 30.06.11

All Portfolio

LMM Funds

VC Funds

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

Europe is home to many global

leaders and Billion $ companies

Source: Holtzbrinck Ventures, EIF

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European tech companies surpassing ~USD 1bn valuations

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

European tech companies reaching ~USD 1bn valuations

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Music:

Games:

E-commerce:

Software:

Finance:

Europe is leading the way in many areas

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

Accelerators and incubators:

Events:

Serial entrepreneurs:

Top US VCs are also in Europe:

Public Policy:

Corporates:

European VC eco-system is vibrant and mature

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

And many others…

Niklas

Zennstrom

Brent

Hoberman

Lars

Hinrichs

Ben and Josh

White

Mans

Hultman

Successful entrepreneurs becoming VC investors

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

World-class research

Educated human capital

Substantial funding for basic R&D

Well functioning IP system

Capable entrepreneurs

Success stories raising level of ambition

Sound base of experienced VC investors

Vibrant and mature eco-system

European VC investment opportunity

based on strong fundamentals

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.

• The VC industry has not yet delivered risk-commensurate

returns…

• BasleIII, SolvencyII, AIFMD = hostile regulations for equity

investments

• EuVECA, EUSEF, ELTIF…: = market fragmentation & complexity

• Capitalise on existing well-functioning structures (SICAR-SIF)

• Lack of European corporate leadership (Apple, Google, Facebook,

Microsoft…)

• Lack of a Digital Single Market

• Early-stage entrepreneurial activity < 6% of the population

(Germany, France, Italy, Spain) - USA and BRIC 10 – 17%

But…

European Venture Capital. The Facts. Patric Gresko. European Investment Fund.