Presentation on theme: "9 th ETAP Forum on Eco – Innovation Financing the eco-innovators «The Italian Angel Market & The Early Stage Investment Opportunities in Cleantech» Paolo."— Presentation transcript:
9 th ETAP Forum on Eco – Innovation Financing the eco-innovators «The Italian Angel Market & The Early Stage Investment Opportunities in Cleantech» Paolo ANSELMO IBAN President November 2010
2 4.4. Italian BA Profile BA's personal profile from a recent Survey IBAN Associations profile The Italian Angel Investing Market The Italian Business Angels profile Seed and Early stage investment opportunities in cleantech Summary
3 4.4. Italian BA Profile BA's personal profile from a recent Survey It is an Italian non-profit making Association – born in 1999, through a project promoted by European Commission (DG Industry) In Italy, it institutionally represents and promotes investment initiatives in the venture capital market coming from informal investors, usually called Business Angels (BA) IBANs President is board member of EBAN, the European Association that represents BA Networks and Seed Fund in Europe Through its birth, and a close co-operation with AIFI (the Association representing the formal venture capital in Italy), IBAN has felt up a remarkable gap in the Italian venture capital chain Today, IBAN represents a more than 500 informal investors community across all Italy IBAN Association (1)
4 IBAN Association (2) Our Network to sustain Informal Venture Capital Market FINANCING INSTITUTIONS NATIONAL AND INTERNATIONAL PARTNERS BUSINESS ANGELS SERVICES TO FIRMS TECNOLOGY CENTRES IBAN During last years, IBAN has created a strong relationship network that links Institutions and Economic Operators, Know–How and Expertise, covering all value chain in the early stage phase. In this way, IBAN can really support start–up entreprises in their growing process.
5 IBAN Association (3) Our Network to sustain Informal Venture Capital Market IBAN Soci isolati, autonomi ed operativi BAN classico territoriale plurisettoriale BAN tematico, con operatività nazionale/intern azionale Club di angel investors
6 IBAN Association (4) Our Publications to sustain Informal Venture Capital culture Legal and Fiscal handbook for BA - 2010, in partnership with Studio Legale Gianni, Origoni, Grippo & Partners. Formal Documents for Early Stage Phase (NDA, Term Sheet, Investment Agreement) - 2010, with Studio Legale Rossotto & Partners Business Angels and Informal Venture Capital in Italy - 2009, in collaboration with SDA Bocconi University – Finance Department Implementation of European MiFiD Directive and IBAN circuit activity, 2008 – in collaboration with Studio Simmons & Simmons. Guide to setting up a business with Business Angel - 2008, in collaboration with KPMG Italia. Business Angel in Italy - 2003, in cooperation with Professors coming from II° Università di Napoli. Standard Behavior Handbook for BAN in partnership with ISTUD Foundation, 2001.
7 Italian Angel Investing Market (1) Which are the data in 2009 ? A. INSTITUTIONAL SEGMENT Venture Capital (VC) and Private Equity companies have invested 2.615 ML, with a decrease of 52% compared with 2008. Especially, for the Early Stage sector, they have closed 79 deals for an amount of 98 ML. TYPE OF STAGEAMOUNT ML N. DEALS Turnaround41611 Early Stage9879 Expansion371112 Replacement-- Buy Out1.68872 Sources: Aifi, 2010
8 Italian Angel Investing Market (2) Which are the data in 2009 ? Sources: IBAN, Survey 2009 Investment amount registered by IBAN31.5 Mln Deals 179 Exit declared 33 Average amount for deal176.000 Number of examinee projects 1.394 EARLY STAGE SECTOR: Seed32% Start up38% Early expansion27% Other operations 3% B. INFORMAL VENTURE CAPITAL SEGMENT
9 Italian Angel Investing Market (3) Industry had a strong growth in the last years Sources: Institutional (Aifi, Pwc); Informal (Iban) Var 09/08 – 16% Var 09/08 +1.2 %
10 Sources: Institutional (Aifi – Pwc); Informal (Iban) Italian Angel Investing Market (4) Deals in the industry follow the investments Var 09/08 – 10% Var 09/08 +49 %
11 Italian BA Profile (1) BA's personal profile from a recent Survey Man, 49 years old, top manager or entrepreneur, strong academic background (masters degree, post-lauream) Place of residence in the North of Italy (83%) Range of 150-200 km to focus its investments to stress BA commitment with entrepreneur Personal assets available around 1.000.000 - IBAN Member He generally allocates nearly 10% of own assets for Angel Investing Average Investment for deal is around 176.000 Interesting in High Tech sector Source: Iban, Survey 2009
12 Italian BA Profile (2) BA's personal profile from a recent Survey BA's added values (over the risk capital) are: - strategies - contacts BA's best information's come from: - IBAN network - his personal network (others entrepreneurs & friends) Source: Iban, Survey 2009
Italian BA Profile (3) MAIN DIFFERENCES BAs IN USA AND ITALY USA (data 2009) – ITALY (data 2009) USAITALY Average amount of deals per BA4.71.5 Average amount of investment per deal$ 50.000-100.000 (55%) $ 100.000-1.000.000 (25%) > $ 1.000.000 (20%) < 30.000 (33%) 30-100.000 (33%) 100-500.000(11%) > 500.000 (11%) % Investments in seed and start-up phase45%76% Sectors of investment ICT/software/internet, manufactures, Health Care/Med Tech ICT/Software/Internet; Manufactures, Biotech/Med tech Geographic Area of investmentby 250 km (28%)by 200 km (50%) % of potential BAs with no geographical restrictions37%42% Source of deal flowFormalInformal Preferred way outTrade sale/merger Average IRR registered27%22% Average holding period from 3 to 6 years3.3 years
14 Italian Angel Investing Market 2009, % Investments by sector Source: Iban, Survey 2009
15 What is Cleantech? Former Energy sector …… The US Cleantech Group provides a comprehensive definition: A new, innovative technology to create products and services that compete favorably on price and performance while reducing humankind's impact on the environment & offering a cleaner or less wasteful alternative to traditional products and services
16 The huge scope for cleantech investments Source: The Cleantech Group Energy Generation: wind, solar, hydro/marine, biofuels, geothermal, other; Energy Storage: fuel cells, advanced batteries, hybrid systems; Energy Infrastructure: management, transmission; Energy Efficiency: lighting, buildings, glass, other; Transportation: vehicles, logistics, structures, fuels; Water & Wastewater: water treatment, water conservation, wastewater treatment; Air & Environment: cleanup/safety, emissions control, monitoring/compliance, trading & offsets; Materials: bio, chemical, other; Manufacturing/Industrial: advanced packaging, monitoring & control, smart production; Agriculture: natural pesticides, land management, aquaculture; Recycling & Waste: recycling, waste treatment.
17 Do these cleantech investments compete favorably on price and performance? Cleantech alternative Cleantech alternative The traditional product
18 Trends in cleantech investments Source: The Cleantech Group
19 Trends in cleantech investments Source: PwC/NVCA MoneyTree report
20 Is the Venture Capital business model broken?
21 The investment opportunity for seed- stage investors In order to be sustainable in the long-term and avoid dotcom-like bubbles cleantech investments have to be capital-efficient; Cleantech is not only about renewable energies (i.e., PV, wind, biomasses.); there is a great deal of less capital-intensive investment opportunities in cleantech: suitable for seed-stage and less risk-averse investors; Cleantech is also about seed- and early-stage investments: less capital intensive, better valuations, greater value-adding potential, but higher risk; fixing the big IRR issue of traditional venture capital investing.
22 How is IBAN going to address these challenges/opportunities? The forthcoming Italian Cleantech Club (1) An investment club, operating through syndication, focussed on cleantech investment opportunities backed by an independent committee of cleantech specialists to source, and select the best deals; C leantech is a global opportunity; joint-marketplaces to exchange investment opportunities with some of the world's most successful cleantech clusters (Sweden, Israel, and other European countries); P artnership with online content providers (i.e. www.energiaspiegata.it) to source the best cleantech technology transfer investment opportunities coming from the top Italian Universities.
23 How is IBAN going to address these challenges/opportunities? The forthcoming Italian Cleantech Club (2) Incubators, Technology Parks, University technology transfer Offices and IBAN network will be the main deal flow sources Seed and Early Stage investments in Italy and abroad between 50k and 500k euro, with possible co-investment with other Angel groups and Seed funds; The Club will be managed by a specific Advisory Board (5 members) in charge of scouting and coaching business opportunities, also thanks to IBAN Association support; 3 Investment Forum per year with 6 pitching companies each time; Focus on 3-4 years exit time and trade sale way-out (M&A); Per each deal a champion will manage the due diligence and the investment process; Each ICA members (forecast 15-20) must fill a specific form in with his/her financial and managerial commitment.
24 How is IBAN going to address these challenges/opportunities? The forthcoming Italian Cleantech Club (3) Entrepreneur Business Angel Contact with IBAN Executive Summary validation Drafting of Executive Summary Preparation of Elevator Pitch Identification Identification of investment priorities BA added to database Participation in investment forum/club Confronting offer and demand Circulation of Executive Summary MATCHING
25 A first step has just been done : The Green Technologies Investment Forum The GREEN TECHNOLOGIES INVESTMENT FORUM (GTIF), organized in February 2010 by IBAN Association (Italian Business Angels Network) and the Swedish Business Region Goteborg AB provided a unique chance during which investors and entrepreneurs coming from Italy and Sweden matched. Eleven Italian and Swedish green companies, selected by a panel of experts, pitched their activities to qualified investors, Business Angels, Seed, Venture Capital Funds and Trade operators. During the event two break-outs had been forecasted in which an Italian and Swedish keynote speakers presented strengths, weaknesses and opportunities of today clean-tech market. All companies had a marketplace area where they could meet investors during and after the event To cross experiences, best practices, business and trade opportunities and networking have been the key words of the initiative
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