DFJ Esprit CEO Looks to Build on 2010
January was an active month for notable exits in the European technology sector, with BSkyB buying WiFi network The Cloud; Amazon picking up DVD rental business Lovefilm; and mobile phone network Orange embarking on a takeover of video hosting site Dailymotion.
London-based investor DFJ Esprit was involved in two of those deals, having acquired The Cloud as part of a 3i venture portfolio it bought in 2009, and owning a Lovefilm stake it had held since a 2004 investment in predecessor Video Island.
With “several more” exits in the pipeline, according to DFJ Esprit CEO Simon Cook, 2011 is also looking promising for Europe’s VC industry.
“Europe wasn’t great for exits last year, but we are starting to see some spillover of excitement from the United States, where 2010 was a huge year for exits, and that will translate into a bouyant mergers-and-acquisitions market in Europe this year,” Cook says..
The spillover, though, may be limited. Cook acknowledges that U.S. firms should have a strong fundraising year, but mostly it will be another tough go for European firms.
“I don’t see anything to suggest otherwise,” he says.
Raising venture funds in Europe might be easier if risk expectations were managed differently, Cook says.
“The perception today is that venture capital is more risky than private equity, but it may be no more so because of leveraged companies,” he says.
“Look at EMI. Buyouts can be just as risky,” he says, referring to how the London-based music company has changed owners several times and is being taken over by Citigroup.
Unsurprisingly, given that DFJ Esprit is a member of the Draper Fisher Jurvetson global network, Cook welcomes U.S. involvement in the European venture capital sector, which he believes will undergo further consolidation this year.
“Venture capital has gone global because portfolio companies are going global quicker so I expect to see more tie-ups with the strongest U.S. firms,” he says. “American firms bring a positive attitude to technology, but their challenge is to find partners on the ground with local knowledge.”
Local knowledge can help unearth what Cook reckons are the hidden gems of Europe’s technology sector.
“Europe is good with behind-the-scenes technology with things like semiconductors that go into the iPad or iPhone,” he says. “But because Europe is a region of split nationalities, we don’t have [pan-European] household consumer names like in the United States. Our tech sectors might have huge success, but the media, government and the public don’t see it.”
Nahum Boosts Actis Fundraising
Emerging markets investor Actis has bolstered its contacts book with the appointment of Marc Nahum to its Investor Development Group as distribution director for Europe and the Middle East.
Nahum, based in Actis’ London office, will monitor relations with the firm’s 118 investors and work to secure new limited partners.
His previous role was as director, client relations at RREEF, Deutsche Bank’s alternative investments business.
Actis, which was created by British development finance institution CDC in 2004, has $4.8 billion under management and its last fundraising was the $750 million pan-emerging markets Actis Infrastructure II, raised in October 2009.
Sader Hired for TA’s French Connection
Boston-based TA Associates has appointed Patrick Sader as a senior vice-president in its London-based office, where he will focus on growth and buyout opportunities in Francophone regions of Europe.
Sader is a veteran of American firms’ European operations, having previously developed the franchise of Argan Capital, formerly Bank of America Capital Partners, in Eastern Europe and France. He has also worked on the private equity transactions team at Terra Firma and on the M&A desk at Merrill Lynch.
TA Associates targets growth companies in the tech, financial services, business services, health care and consumer industries.
Florman Takes Reins at BVCA
has succeeded Simon Walker as CEO of the British Private Equity and Venture Capital Association (BVCA).
He will take over from Walker, who was appointed CEO in October 2007, in mid-March.
During a 30-year career, Florman worked in banking in the United States, founded two European investment banks, spent seven years at private equity firm Doughty Hanson and chaired wind turbine manufacturer LM Glasfiber.
Florman has served as the senior deputy treasurer of the Conservative Party and currently chairs the Centre for Social Justice.
Moshe Pits his Wits at SVB Israel
SVB Financial, the parent of Silicon Valley Bank, has appointed Gadi Moshe head of origination at SVB Israel Advisors.
Based in Herzliya, Israel, which is west of Tel Aviv, Moshe will drive business development, providing growth and startup financing to Israeli tech and life sciences companies.
Moshe has experience in banking and venture capital, having worked for Union Bank of Israel, Bank Hapoalim and Plenus Venture Lending. He also established ETV Capital’s Israeli office in 2005.
SVB Israel was founded in 2008 and forms part of the international network of Santa Clara, Calif.-based SVB Financial, which also has offices in China, India and the United Kingdom.
Burns Turns from Terra to Lead Corestate
Zug, Switzerland-based private equity firm Corestate named Phillip Burns as its new CEO, effective February 2011.
Prior to taking the Corestate position, Burns worked for nine years at London-based private equity giant Terra Firma, most recently as financial managing director.
Burns’ experience in real estate while managing Terra Firma’s Frankfurt office was crucial to his appointment. Corestate has €2 billion ($2.7 billion) invested in the German property market.