Draper Esprit buys stakes in Earlybird funds

Oscar Geen
21 January 2019

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Listed VC firm Draper Espirt has agreed to acquire LP stakes in two funds managed by German early-stage investor Earlybird.

Draper Esprit will fund the acquisitions by issuing up to £100m of new shares on the AIM segment of the London stock exchange at 530 pence apiece. Numis and Goodbody are acting as brokers for the accelerated bookbuild.

The VC will buy a 27% stake in Earlybird IV for €63m (£55m) and a 5% stake in Digital East Fund 2013 for $20m (£16m).

The fresh capital will also be used to commit €5m to the forthcoming Earlybird Digital East Fund 2 through Draper Esprit's fund-of-funds programme, and the remainder will be used for other direct and secondary investment opportunities.

The announcement comes six months after the two firms announced a strategic partnership to share dealflow and co-investment opportunities. Draper Esprit took an €18m stake in Earlybird Fund VI as part of that deal.

Portfolio
After the transactions, Draper Esprit will indirectly hold shares in 19 companies currently owned by the two Earlybird funds. These holdings include:

Smava, a German consumer lending business that has raised $135m over six funding rounds to date.
Peak Games, an Istanbul-based developer of mobile games including Toy Blast and Toon Blast.
UiPath, a Romanian robotic process automation business, currently valued at more than $3bn after raising a $225m series-C in September 2018.
B2X, a Munich-based after-sales service for the consumer electronics, telecoms and IT industries.
Nfon, a German cloud-based telephony company that listed on the Frankfurt Stock Exchange last year.
Socialbakers, a Czech enterprise software business in the social media analytics segment.

Along with 13 other investments. Peak Games and Smava are considered by Draper Esprit to be the key value drivers in Earlybird IV, while UiPath is considered the key value driver in Digital East Fund 2013.

People
Draper Esprit – Simon Cook (CEO).

Advisers
Equity – Numis Securities (corporate finance); Goodbody Stockbrokers (corporate finance).