June 29, 2018
Two football-related businesses targeted in June
June has started slowly in terms of angel investment in Western Europe as just 22 deals worth an aggregate EUR 48 million have been announced during the month under review, according to Zephyr, the M&A database published by Bureau van Dijk. By value, this represents an 82 per cent decline on EUR 268 million in May and 63 per cent on EUR 130 million in June 2017, while volume was the lowest recorded since August 2012, when just 12 deals were announced. However, there are still ten days left until the end of the month at the time of writing and a small number of sizeable investments could see a turnaround in June. The second quarter of 2018 had already exceeded any other second quarter on record by value, despite there still being ten days until the end of June. In total, EUR 530 million has been invested across 137 deals during the three months, compared to EUR 261 million in Q2 2017, EUR 523 million in Q2 2016 and EUR 266 million in Q2 2015. Volume is also on a promising trajectory, up 16 per cent from 118 deals in Q2 2017. June’s disappointing showing is due to the lack of high-valued deals signed off during the four weeks, with the month’s largest announced transaction worth EUR 12 million and involving Switzerland-based laboratory protocol design software developer Andrew Alliance raising cash from Sam Eletr, Tecan Group and Omega Fund Management.
Two more deals exceeded EUR 5 million in June, the largest of which took the form of a funding round for German fibre optic measurement technology developer fos4X, which raised EUR 8 million from Bayern Kapital, Falk Strascheg Holding and Unternehmertum Venture Capital Partners, among other angel investors. This was followed by Nauta Capital, Allgeier and Global Founders Capital Management’s participation in a EUR 6 million cash call from German online employee referral software-as-a-service developer Talentry. These two deals were the only two of the top 20 to feature a German target. The majority of angel investors targeted businesses in the UK in June, with seven such deals announced in the top 20, followed by France with four and Italy with three.
The software sector continues to be a popular target for angel investors and featured a number of times in the month’s top deals by value. However, there were some exceptions to the rule as French muesli delivery application maker Dear Thinking & Co and Italian raw food restaurant operator Future Food also featured. In the wake of the FIFA World Cup kick-off, two deals stood out this month. The first involved France-based amateur football statistics tracking platform Sportbak, which raised EUR 1 million from Alumni Business Angels, BPIFrance and Kapinno. This was followed by Just Development Sweden, an online mobile football performance measurement software developer, raising just under EUR 1 million from individual investors such as Erik Fischbeck, Gert Nordin, Christian Ehrhardt and Levina Persson. This highlights the fact that current events can have an impact on investment levels in a given segment.
Sportbak operates in the data processing industry, which has been targeted in a number of sizeable transactions since the start of 2006. The largest angel investment in the industry took place last year, when China’s online second-hand car trading platform Chehaoduo Old Motor Vehicle Brokers raised EUR 713 million in a round of funding from Matrix Management, Sequia Capital Operations and Star Angel Fund, among others. Other companies in the data processing industry to have featured in some of the largest angel investment deals in recent years include Zenefits Insurance Services and AvidXchange, both of the US, and China-based Xingyin Information Technology (Shanghai).
In conclusion, the month-on-month decline in June is attributable to a dearth of large angel investments in Western Europe; however, this has not had a negative impact on the results for 2018’s second quarter, which has already attracted significantly more value than any other second quarter on record. With Q1 2018 also exceeding other first quarter periods on record, 2018 is on track to be a record year for angel investment in the region.