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Bridging the Valley of Death - Industrial Technologies 2012 by Ulla Brockenhuus-Schack

Bridging the Valley of Death - Industrial Technologies 2012 by Ulla Brockenhuus-Schack. 19 .6.12. 1. Introduction. SEED Capital in brief. The largest early stage venture fund in Denmark . Government pre-seed funding €8-9 million / year Traditional venture funds

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Bridging the Valley of Death - Industrial Technologies 2012 by Ulla Brockenhuus-Schack

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  1. Bridging the Valley of Death- Industrial Technologies 2012by Ulla Brockenhuus-Schack 19.6.12

  2. 1 Introduction

  3. SEED Capital in brief • The largest early stage venture fund in Denmark. • Government pre-seed funding €8-9 million / year • Traditional venture funds • € 240 million (DKK 1,8b) under management • 70 portfolio companies • 11 positive exits and 1 IPO • Attracted more than 320 million € (DKK 2,4b) to portfolio companies over the last 7 years • Team of 20 of which 14 investment professionals with relevant domain knowledge

  4. 2 The Challenge: Crossing the valley of death

  5. Investment landscape Technologycreation Market-Focused Business and Productdevelopment Commercialization Cash flow Sales Time Valley of Death Governement & pre-seed Seed & Business angels Venture Capital Stock Typical investors Public Sector Private Sector

  6. 3 Innovation Incubators: Govermentfundedpre-seed investors

  7. Innovation Incubators in Denmark • 6 Innovation Incubators have annual budget of €28m • Purpose: Help universities and innovative entrepreneurs to select and commercialize high potential inventions and to assist them to grow and get further funded • Invest up to € 800.000 in a single company applying traditional ‘venture capital methods’

  8. Innovation IncubatorCircle of life Government funds to Innovations Incubator is repaid 10 times

  9. 4 The SEED Capital business model - in cooperationwith DTU Symbion Innovation A/S

  10. We work from research to venture DTU Symbion Innovation Government financed pre-seed funding Yearly investment budget of € 7m (+50 mDKK) Up to € 0,8m (6 mDKK) per project Dedicated team of 10 Investment Managers • Research • DTU • RISØ • KU / KU-life • ITU • AAU • SDU • AU • HS • GTS: i.e. Delta & Bioneer SEED Capital 6 partners responsible for DSI and 4 Venture Funds Pre-emptive investment rights from DSI Up to € 9m (68mDKK) per project

  11. Deal Sourcing Business Due Diligence Review IM investment Business Due Diligence SEED Investment Deal Sourcing Review SEED (option) A unique selection process to test team, IPR, technology development, market etc. and secures time to establish syndication for VC funding 6-18 month “live” Due Diligence DTU Symbion Innovation SEED Capital

  12. Howweselectinvestments

  13. Investmentsizes Private funding Public funding 0,8 – 9 mio. € 40% 0,3 mio. € 72% 0,5 mio. € Time DTU Symbion Innovation Secondaryinvestment DTU Symbion Innovation Primaryinvestment SEED Capital

  14. Closely linked to Denmarks largest Incubator - Accelerace 155 companies emerged from Accelerace 97% are still active * - inkl. Gazellegrowth, Bio, Spin-off ** - Survey from 2010

  15. Partners Operational Entrepreneurial Executive Investment Consulting Transaction Board Private Equity Experience

  16. We are never better than our organization • Investment team • One location • Domain knowledge • Clear goals and incentives • Investments management procedures well established • 12 module VC training program developed in-house + EVCA courses

  17. Strong international syndication • Abbott US • AccelLN • Aravis CH • Astellas US/JA • BioFundFI • Captricorn B • Coloplast • Conduit UK • DeNovoUS • EGJ DK • Faurecia F • FerdN • InnFond • Inventages CH • IVS/Northcap • Lundbeck Foundation • Merck SeronoCH • Navistar US • Nestle CH • Nordea Foundation • Northzone • Novartis Venture • Novo SEED • Novo Ventures DK • Pferd N • REW DE • Seventure FR • SolvayB • Sunstone • TMP US • Vecata • Vækstfonden • YasudaJP • Business angels (50+)

  18. Case: • TechnologyremovingNOx from diesel emission. • Building onlegislaturenowbeingpassed in US and EU onNOx emission control. Technological foundation developed at DTU SEED Capital Investment 2011 Partnership with Faurecia 2004 2010 Partnership with Navistar Innovation Incubator investment

  19. 5 Results

  20. DKK 2.4 bn Private Funding (9x) Note: Exludingfunding to Symbion Capital portfolioworth 1 b DKK (primarilyEvolva)

  21. Documentedstrong performance • DSI verystrong performance compared to other Innovation Incubators • Outperforms other Innovation incubators on capital attracted by a factor 9 • Shows highest return on investment • From 2007 to 2010 • Portfolio turnover grew from € 110.000 to € 400.000 • Portfolio employees grew from 3 to 7

  22. Significantvalue has beenbuilt in notoriousdifficult segment

  23. Contact details • Thank You • Ulla Brockenhuus-Scahck • Managing Partner • SEED Capital Denmark • Diplomvej 381 • DK-2800 Kgs. Lyngby • T: (+45) 2082 8374 • ubs@seedcapital.dk

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