A presentation of SEED Capital

– and an introduction to what we look for in

startups

April 2013Jakob Ekkelund, SEED Capital

SEED in numbers (I)Agenda

1. Intro to Seed capital

2. Investment process and criteria

3. Cases

SEED in numbers (II)

• Cand. Merc (CBS)

• Business experience– TDC Consumer, Head of Strategy – TDC, Strategy consultant– TDC, Graduate Traniee– TDC, Finance

• Startup experience: – Designfirmaet.dk– Rainmaking– Betternow.com– Sidneylëe.dk

• Selected board positions:– Vivino– Bownty– Wantr– Leikr

About Me:Jakob Ekkelund, Investment Manager (ICT), SEED Capital

• Intro to Seed Capital

1

SEED Capital is a venture capital company who finance and assist competent entrepreneurs based in Denmark and Southern Sweden developing Life science, IT, and Cleantech companies of the future.

In addition, SEED Capital acts as venture partner for government funded pre-seed investments through DTU Symbion Innovation.

Who is SEED Capital?

Investment focus

Seed/early stage to exit, early syndication

Denmark and southern Sweden

Local academic and industrial centers of excellence

GeneralEnergy production efficiency (solar, wind, CHP)

Energy storage (fuel cells and batteries)

Cleaner and/or less resource demanding technological processes (industrial and material)

Pharmaceuticals and medtech (devices/diagnostics)

“Personalized” diagnosis and treatment

Opportunistic investments in “ground breaking technology”

Software: SaaS, mobility and convenience (Location Based Services) Crowd Sourcing, crossover consumer-social/enterprise

Hardware: Embedded systems, energy technology, signal processing, automation/robotics, nanotechnology

Tele/mobile: Mobile location based services, mobile marketing, mobile commerce

Cleantech

Lifescience

IT

70 companies in portfolio

LifescienceIT

Cleantech

Where do set in?

Technology creationMarket-Focused

Business and Product development

Commercialization

Governement & pre-seed

Seed & Business angels

Venture Capital StockTypical

investors

Time

Cash flow

Public Sector Private Sector

Sales

Valley of Death

DTU Symbion Innovation SEED Capital

SEED key figures

• Managing 1+ bn. DKK– 2 Venture funds:

• SEED Capital Denmark II (530 mDKK)• SEED Capital Denmark K/S (532 mDKK)

– DK’s leading innovation environment (IM): • DTU Symbion Innovation A/S (2010: 50 mDKK for investments)

• 70 portfolio companies• 12 exits with >1x on invested capital, 2 IPO’s• 20 FTE

SEED in numbers (II)Annual activities in brief

500+ business proposals

100+ meetings

~15 DTU Symbion Innovation investments

3-4 SEED Capital investments

Investment sizes

DTU Symbion Innovation

Primary investm

ent

DTU Symbion Innovation

Secondary investment

SEED Capital

Time

82%

40%

0,5 mio. €3,5 mio. DKK

0,3 mio. €2,5 mio. DKK

0,8 - 6,7 mio. €5 - 50 mio. DKK

Public funding

Private funding

How it works with funds

Execution

Execution

Execution

Fund no. 1 Fund no. 2

Cash in no. 1

Fund no. 3

Cash in no. 2

Fund no. 4

Investment

Investment

Investment

Investment

3-4 years

10 (+2) years

SEED in numbers (II)Why should an entreprenur choose Seed Capital

• Money• Involvement through Board of Directors• Network• Great track record• We can take a company from the early

stages and take it all the way..

2• Investment process and criteria

The investment process

- Project screening

Introduction Convincing Deep diving Completion

Phases:

Activities:

Materials:

- Meeting

- Internal Pitch

- Partner presentation

- Due diligence

- Investment recommen-dation

- Final papers

- Term Sheet

- Teaser/Business Plan

- Partner deck (10 powerpoint slides)

- 2o pages Investment recommen-

- dation

- Investment & shareholder agreement +

What we look for - in broad terms

10XCheaperSmallerBiggerFasterMore efficient

With a market potential of more than 1 billion €

Investment Criteria - I

Team/Management

The management of the company has to consist of people with entrepreneurial spirit and relevant and well-documented professional qualifications—or have the prospect of developing them.

The management has to complement each other (No programmers / only programmers) and together form a visionary, cooperative, and dynamic team.

Investment Criteria - II

Market

The newly developed product must be in an attractive market segment that is potentially large, rapidly increasing, or undergoing major restructuring, making new markets for the mentioned product possible

Investment Criteria - III

Product

The product is highly innovative and has a remarkable and continuing competitiveness. The technology is an epoch-making discovery, and the company has preferably patented the discovery.

Its imperative that the product solves a ’burning’ pain forclearly identified customers

Investment Criteria - IV

Scalability

The company is highly scalable and the model of income has a significant chance of generating extensive growth and, in time, obtaining considerable profitability.

Investment Criteria - V

Exit

The investment has potential for a full exit. There should always be more than one exit option. The evaluation of the company looks favorable compared to the existing market conditions.

Short cut .-)

•Cases

3

Interesting cases:

Endomondo provides an online service for tracking, monitoring and coaching your physical activities such as running, biking, walking, skiing etc.

Trustpilot is a web portal where consumers rank companies based on their customer service.

As a common (2D) printer prints on paper a Blueprinter 'prints' 3-dimensional objects based on 3D CAD computer models.

Libratone designs and develops wireless loudspeakers that stream music and audio wirelessly in excellent quality from which ever unit contains the user's music library

Firmafon provides a telephony solution for small end medium sized enterprises... 

Questions?