Transcript Document

THOMSON FINANCIAL
State of the PE Market
Global VC and PE Trends
Ed Vincent
Gemma Postlethwaite
THOMSON FINANCIAL
US Venture/Buyout Industry
Six Year Comparison
VC
# of Firms/Funds
1998
2004
612/1,087 1,059/1,949
Buyouts
# of Firms/Funds
# of Professionals
1998
2004
441/753
580/1,020
4,428
6,452
25
31
6,435
10,471
57
44
Total Cap Mgt
$88.6bn
$260.1bn
Total Cap Mgt
$263.3bn
$491.3bn
Avg Firm Size
$144.2m
$233.7m
Avg Firm Size
$583.4m
$821.8m
Avg Fund Size
$57.8m
$91.7m
Avg Fund Size
$288.7m
$363.8m
$5,000 M
$1,546m
Largest Fund
$4,100m
$7,850m
# of Professionals
# of First time funds
Largest Fund
# of First time funds
Source: Thomson Venture Economics/NVCA
THOMSON FINANCIAL
Global VC Fundraising
Annual Committed Capital (US$m)
Capital Raised by VC Funds; 2000-YTD 2005
100,000
North America
Europe
Asia/Australia
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
2000
2001
2002
2003
2004
YTD 2005
Source: Thomson Venture Economics / NVCA
THOMSON FINANCIAL
Global Buyout Fundraising
Capital raised by Buyout Funds; 2000-YTD 2005
Annual Committed Capital (USD $M)
90,000
North America
Europe
Asia/Australia
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
2000
2001
2002
2003
2004
YTD 2005
Source: Thomson Venture Economics/NVCA
THOMSON FINANCIAL
Global Venture Investment Activity
2000-YTD 2005
120
North America
Europe
Asia
100
80
US$ bn
60
40
20
0
2000
2001
2002
2003
2004
YTD 2005
Source: PwC / Thomson Venture Economics / NVCA MoneyTree™ Survey
THOMSON FINANCIAL
US Venture Sector Analysis
2000
Comm/Media
30%
Life Sciences
7%
Non High Tech
6%
SemiCond/Elect.
7%
Computer
Related
50%
Source: PwC / Thomson Venture Economics / NVCA MoneyTree™ Survey
THOMSON FINANCIAL
US Venture Sector Analysis
YTD 2005
Life Sciences
27%
Non High Tech
12%
SemiCond/Elect.
10%
Comm/Media
18%
Computer
Related
33%
Source: PwC / Thomson Venture Economics / NVCA MoneyTree™ Survey
THOMSON FINANCIAL
US Venture Stage Analysis
YTD 2005
Later Stage
41%
Expansion
39%
Startup/Seed
5%
Early Stage
15%
Source: PwC / Thomson Venture Economics / NVCA MoneyTree™ Survey
THOMSON FINANCIAL
Global Buyout Investment Activity
2000-YTD 2005
North America
Europe
Asia
35
30
25
20
US$ bn
15
10
5
0
2000
2001
2002
2003
2004
YTD
2005
Source: Thomson Venture Economics/NVCA
THOMSON FINANCIAL
US Venture-Backed IPO
By number of IPO’s and Offer Amount
2001-YTD 2005
250
250
200
150
150
100
100
# of IPO's
US$ bn
200
50
50
0
0
2000
2001
2002
Value
2003
2004
YTD 2005
# of deals
Source: Thomson Venture Economics/NVCA
THOMSON FINANCIAL
US Venture-Backed M&A
By number of Deals & Value
2001-YTD 2005
60
400
350
50
US$ bn
40
250
30
200
150
20
# of Deals
300
100
10
50
0
0
2000
2001
2002
Value
2003
2004
YTD 2005
# of deals
Source: Thomson Venture Economics/NVCA
THOMSON FINANCIAL
Performance
THOMSON FINANCIAL
Thomson Venture Economics – Performance database
Maintained by Thomson Venture Economics since 1969
•1771 US Funds formed 1969-2004
•956 European Funds 1980-2004
•230 Other International Funds formed 1980-2004
•74 Funds of Funds
Information Requirements
•Firm Information
•Fund Information
•Portfolio company investment
•Transaction details
•Cashflows – capital calls, distributions, net asset values
THOMSON FINANCIAL
Benchmarking Purposes
Provide industry-standard benchmarking products for use in
commitments, asset allocation and due diligence
Provide information and appropriate transparency crucial to:
 Provide critical information in the due diligence process
 Make private equity an asset class with replicable benchmarks
THOMSON FINANCIAL
US Venture Funds
Annualized Net Cumulative IRR by Vintage Year
As of December 31, 2004
100
Annualized Cumulative IRR
80
60
40
20
0
-20
-40
5
9
0
1
2
3
4
5
6
7
8
9
0
1
2
3
4
5
6
7
8
9
0
1
2
3
4
-7 6-7 98 98 98 98 98 98 98 98 98 98 99 99 99 99 99 99 99 99 99 99 00 00 00 00 00
9
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2
2
2
2
2
6
7
19 19
Source: Thomson Venture Economics/NVCA
THOMSON FINANCIAL
U.S. Venture Capital
Since Inception Realization Multiples (DPI/RVPI)
by Vintage Year as of December 31, 2004
Times invested Capital
5.0
4.5
RVPI
4.0
DPI
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
1969-75 1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
Source: Thomson Venture Economics/NVCA
THOMSON FINANCIAL
Venture Economics
Private Equity Performance Index (PEPI)
Pooled IRR net to investors as of December 31, 2004
All funds formed 1969-2004
Fund Type
1 Yr
3 Yr
5 Yr
10 Yr
20 Yr
Seed Stage VC
Early Stage VC
Balanced VC
Later Stage VC
-2.6
32.4
14.7
10.3
-9.2
-7.4
0.0
0.0
-4.7
-1.3
0.5
-4.6
19.5
46.1
18.2
15.4
10.7
20.7
13.3
13.7
All Venture
18.1
-2.7
-1.2
26.1
15.7
Small Buyouts
Med Buyouts
Large Buyouts
Mega Buyouts
27.0
30.1
14.5
19.2
4.4
2.9
8.7
8.9
2.0
-0.5
3.1
3.6
9.1
10.6
11.3
7.8
29.1
17.6
14.7
9.8
All Buyouts
19.2
8.1
3.0
8.9
13.2
9.7
3.3
3.0
7.0
9.3
18.6
4.5
2.0
13.0
14.0
Mezzanine
All Priv Equity
Source: Thomson Venture Economics/NVCA
THOMSON FINANCIAL
Private Equity Net Returns to Investors*
From Inception to December 31, 2004
V
C
B
U
Y
O
U
T
S
Stage
No.
Pooled
Upper
Quart
Med
DPI
RVPI
TVPI
Early/Seed VC
Seed VC
Balanced VC
Later Stage VC
545
65
426
182
20
10.2
13.6
13.8
16.2
13.3
15.6
15.2
2.7
4.0
5.4
5.4
1.29
1.08
1.03
1.04
0.54
0.39
0.50
0.44
1.83
1.48
1.53
1.49
1153
15.9
15.9
4.4
1.12 0.50
1.63
173
252
146
8.2
0.2
7.9
7.4
4.2
10.7
0.0
-3.1
0.0
0.74
0.40
0.66
0.68
0.60
0.59
1.42
1.01
1.26
Total European Venture 571
6.0
6.7
-0.4
0.60 0.62
1.21
Small Buyouts
Medium Buyouts
Large Buyouts
Mega Buyouts
186
105
82
101
25.0
16.4
17.4
8.6
18.6
16.1
18.8
14.7
7.9
6.8
7.0
5.8
1.32
1.07
1.01
0.64
0.40
0.42
0.59
0.66
1.73
1.49
1.59
1.30
Total US Buyouts
474
13.1
17.8
7.0
0.81 0.60
1.41
Small Buyouts
Medium Buyouts
Large Buyouts
Mega Buyouts
218
36
28
25
11.2
17.7
20.4
6.4
15.8
22.2
18.6
12.8
7.6
9.0
7.0
1.8
0.92
1.16
1.09
0.38
0.51
0.54
0.55
0.81
1.42
1.70
1.64
1.19
Total European Buyouts 307
12.3
16.5
6.9
0.70 0.67
1.37
Total US Venture
Development VC
Early VC
Balanced VC
*US Funds formed 1969-2004
European Funds formed 1980-2004
Source: Thomson Venture Economics/NVCA/EVCA
THOMSON FINANCIAL
European vs. US Private Equity
Cumulative IRR Since Inception to Dec 31, 2004 by Calendar Year
Net IRR Since Inception (%)
25.0
20.0
15.0
US
10.0
EUROPE
5.0
0.0
1992
1993
1994
1995
1996
1997
1998
1999
Calendar Year
2000
2001
2002
2003
2004
*US Funds formed 1969-2004
European Funds formed 1980-2004
Source: Thomson Venture Economics/NVCA/EVCA