M√•rten Vading, Ross Ahlgren and Maurizio PetitBon of Kreos participated at three conferences during Q1 2015:
- Mobile World Conference (MWC) in Barcelona
- TechTour Growth Forum in Geneva
- BioCapital Europe conference in Amsterdam
Focused on some of the high growth sectors where Kreos has been active during 2015, here are a few observations from the conferences which we thought would be of interest to our Kreos Quarterly readers.
WCthe major theme was ‚ÄúMobile is now at the centre of our lives‚Äù.¬† Constant connectivity, wearable computing, mobile health monitoring, the Internet of Things (IoT) – and the smart-phone turning into the remote control of people‚Äôs lives – are major areas attracting investment momentum. The Apple Watch could be the category definer in the consumer and healthcare space and could drive ample opportunities for the fast growth and exit of companies in¬† consumer-facing constant-connected spaces.
Additionally, established industrial companies are applying connectivity capabilities to their current product lines as a way of moving from product-centric to solutions-oriented business models, where devices are enabling services such as maintenance and support, remote management, location services, yield management and monitoring. This development could provide ample opportunity for growth, as well as M&A exits for growth-stage companies which emerge as leaders in the industrial connectivity and IoT spaces.
These developments impact mobile operators as well, as constantly-connected devices require multi-carrier and multi-network (cellular and WiFi) roaming with carrier-agnostic mobile connectivity. The changing environment of operators was highlighted by Google announcing that it is launching a virtual mobile network in the US, allowing users to switch seamlessly not only between cellular and WiFi connections but also between the towers of competing mobile phone networks. This dynamic could enable opportunities for high-growth hardware and software companies servicing the carrier space as well.
At the BioCapital Europe conference, a major event where healthcare investors meet a selection of high quality European public and private companies, several themes emerged from a wide range of discussions:
¬®¬†the European healthcare space has become more mature with an increasing number of later-stage companies with growing sales and/or significant partnerships with large pharma or medical device companies
¬®¬†there are sectors ‚Äì¬† especially in medical devices ‚Äì¬† where European growth companies are slightly ahead of similar US-based companies in terms of underlying technology and level of market attractiveness
¬®¬†the European IPO environment for healthcare companies continues to be bullish, with a number of successful completed IPOs and a strong pipeline of companies prepping for an IPO during the remainder of 2015
¬®¬†there are a growing number of European healthcare investors which have completed¬† exits and therefore are able to raise new funds, which could generate significantly more investment activity in the European healthcare and life sciences space in 2015. This could provide a catalyst for continued strong Kreos activity in the space similar to 2014, in the coming years.
The Tech Tour Growth¬†Forum, echoed some similar themes in the mobile, constant-connectivity and IoT spaces, as well as highlighting European fintech and big data growth financing opportunities. At the conference some interesting European growth sector funding data was presented including:
¬®¬†the Euronext exchange had over 200 IPOs in 2014, providing ample exit opportunity for European high-growth companies
¬®¬†there were fifty-six ‚Ç¨20m+ late-stage growth financing rounds¬† in 2014 for European growth companies ‚Äì¬† these are typically financing rounds which Kreos complements the equity sponsors
¬®¬†the velocity of change in the equity investor arena from 2004 to 2014 has increased¬†with 30 new investors joining the Top 50 investors (largest amount of growth financing) over the past 10 years. Kreos has been successful in building relationships with a large number of these investors
Several Kreos portfolio companies participated at these conferences including Heptagon, Openet, Celltick, Symetis, Kiadis, TiGenix, Altair, ip.access, Pontis, CBNL, Fyber, Mobile Aware, Wahanda, Commprove, EPS, MedicAnimal, Mister Spex and Inneractive.
We are looking forward to financing a number of new companies leveraging the next leg of growth in these spaces in 2015 and beyond.