Sun shines for booming DACH venture

DACH has become a real hub for European venture, with the recent EUR546m exit of German solar company ersol by Ventizz highlighting this trend (see page 54). The region ranks second in Europe only behind the UK, according to unquote's proprietary database Private Equity Insight. In the DACH region, the total value of early-stage investments in the period from January to May 2008 amounted to EUR212.9m, up from EUR172.6m between January and May 2007, while investments in the UK remained stable, growing only slightly from EUR224.1m to EUR226.6m in the same period. France, Southern Europe, the Nordics and Benelux saw significantly less venture activity in the same period.

The figures become even more striking when compared to the rest of Europe: The average investment size in DACH companies in the first five months of 2008 was EUR9.3m compared to EUR3.5m in the UK. The high value per deal suggests that venture is becoming more selective - portfolio companies receive relatively large amounts of money as GPs provide follow-on funding - so was the case with U3 Pharma (see page 55). Recent examples of sizeable venture infusions include the EUR61m funding in thin film solar company Odersun AG led by Virgin Green Fund (March 2008, page 24), and the EUR53.9m series C round for online advertising network Adconion Media Group by Index Ventures and Wellington Partners (March 2008, page 25). Significant rounds were closed for a number of life sciences companies, such as the EUR25m round in biopharmaceutical company Pieris AG (April 2008, page 08).

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