1. An overview of the VC market and Vækstfonden 12 March 2010 Uffe Arlø Theilade, Investment Director, Vækstfonden

2. / side Agenda 25. juni 2015 2 1.The idea and rationale for VC 2.An introduction to Vækstfonden 3.VC in Denmark 4.Market developments and challenges

3. / side Why do we need venture capital? 25. juni 2015 3

4. / side4 Types of finance (risk profiles) Debt Quasi-equity Equity Traditional companiesTechnology companies Debt Equity

5. / side25. juni 2015 5 VC Funded Companies in Denmark 20% growth in employment 40% export growth 50% growth in R&D R&D expected to account for 1.5% of GDP in 2010

6. / side6 VC-backed companies in the US -$ 1,800 billion revenue -16% of GDP -10 mil jobs -40% of all IPOs -3 x R&D activity -3 x tax payment -2 x export

7. / side7 Venture boosts the economy

8. / side What is Vækstfonden? 25. juni 2015 8

9. / side25. juni 2015 9 Who We Are Vækstfonden is a government backed investment fund Investment focus on Danish early stage companies - both through direct investments and fund-of-funds Total asset base around EUR 350 million 85 % committed to early stage companies and venture capital funds Largest Danish investor within the ICT and life science spaces

10. / side25. juni 2015 10 Annual investments of DKK 500 million in 25-30 companies – direct as well as through VC funds Loan guarantees on the rise Co-funded more than 3,500 companies to the tune of DKK 6.5 billion Funding Activity

11. / side25. juni 2015 11 Targeted Financing Global Growth Companies International Growth Companies Regional Growth Companies Local Growth Companies Fund of Funds Growth Capital Business Angel Matching Loan Guarantees 51570+ 5 15 1 Potential Revenue Million Euro Funding Need Million Euro

12. / side12 Vækstvirksomheder - 50 mia. kr. Private ventureselskaber Andre private finansieringskilder Vækstfonden Private investorer 4 mia. kr. 6 mia. kr. 10 mia. kr. 40 mia. kr. V æ kstfonden’s leverage effect

13. / side VC in Denmark 25. juni 2015 13

14. / side25. juni 2015 14 Main Attractors in the Danish Market Strong Research Base Entrepreneurial Culture Flexible Labour Market Dynamic Technology Clusters

15. / side15 VC-backed companies’ attraction of foreign capital (relative to GDP; 2007) 0,00% 0,05% 0,10% 0,15% 0,20% 0,25% DKSFINUKIRLNLNOCHEBFPDAIEL Nationale investorerUdenlandske investorer

16. / side25. juni 2015 16 Key Venture Capital Players

17. / side25. juni 2015 17 Geographic Distribution of VC Investment Large concentration around Greater Copenhagen Generally centered around universities and research institutes

18. / side25. juni 2015 18 Top 3 Industries in Denmark % of Total Amount Invested

19. / side Market developments and challenges 25. juni 2015 19

20. / side Challenge: Lack of funds, low new/early stage investment activity 25. juni 2015 20

21. / side25. juni 2015 21 Annual Capital Raisings By VC Funds € Million Total Capital Under Management DK: € 2,983 Million

22. / side25. juni 2015 22 Total VC Investment activity in Denmark

23. / side25. juni 2015 23..Due to Follow-On Investments New Investments Under Pressure

24. / side25. juni 2015 24 Seed Investment at All Time Low

25. / side Challenge: Weak exit options, returns under pressure 25. juni 2015 25

26. / side25. juni 2015 2625. juni 2015 26 The Global Financial Crisis Puts Exit Markets in Reverse Source: VentureXpert

27. / side25. juni 2015 2725. juni 2015 27 IPO Valuations Particularly Hard Hit Source: VentureXpert

28. / side25. juni 2015 2825. juni 2015 28 Entry Valuations Falling Source: VentureXpert

29. / side25. juni 2015 2925. juni 2015 29 Holding Periods Rising Steadily Source: VentureXpert and Vækstfonden

30. / side25. juni 2015 30 Raising money for new ventures increasingly difficult New venture capital funds need to be raised Danish VCs under pressure to deliver attractive exits Exit timing is crucial Key Points

31. / side25. juni 2015 31 Learn More At www.vf.dkwww.vf.dk