Monday, 19 September 2011

VC Factsheet: INDEX VENTURES

Company Summary & History
Index Ventures was founded in 1996 by Neil and David Rimer, and Giuessppe Zocco. Their first office was based in Geneva, with the London office opening in 2002. As such they have traditionally invested globally in companies that have a European focus. However the company is not focused on geographical investing, as shown by the opening of an office in Silicon Valley in 2011.

Their prominence on the European technology scene is exemplified in that they have invested in many success stories of the last decade, for example: Skype, Last.fm, Net-a-porter.com, Betfair, Playfish and Lovefilm.

Key people
Neil Rimer – Co founder and partner of Index Ventures. In 1992, Mr Rimer started the venture capital activity of Index's predecessor firm, later co-founding Index Ventures and raising the firm's first fund in 1996. His current investment focus is on innovative solutions for energy and environmental problems. Previously, Mr. Rimer spent four years with Montgomery Securities and was involved in completing several initial public offerings, secondary offerings, and private placements for technology companies. He is one of ten Founding Members of Le Reseau and a member of the Human Rights Watch Council. Mr Rimer has a BA in History and Economics from Stanford University and a MBA from Harvard Business School.

Giuseppe Zocco – Partner who also co founded Index Ventures in 1996. His investment focus currently includes ecommerce and online services, software and advanced communication components. Prior to founding Index Ventures, Mr Zocco spent five years as a consultant with McKinsey & Company in several European offices. He holds a B.A. in Corporate Finance from Bocconi University in Milan and an MBA from the Stanford Graduate School of Business.

Danny Rimer – Partner who established the firms London office on joining in 2002. His investment interests include Internet infrastructure software and services. He was listed as 59th on the 2011 Forbes ‘Midas list’ of top technology investors. He holds an A.B from Harvard College.

High-Profile Deals
Skype: Index Ventures were an early backer, co-leading their Series B round. Their total investment in that instance was 18.8 million USD. After eBay’s acquisition of Skype in 2005 they purportedly made more than 100 times their initial outlay. Incidentally in 2009 they were involved in the private investment syndicate that bought a majority share in the company back from ebay. In May of 2011 the company was acquired by Microsoft for 8.5 billion USD.

Betfair: As stated by Neil Rimer himself, Betfair was one the ‘firm’s best investments in terms of return multiple’. Betfair had an extremely impressive IPO in October of 2010, with the company valued at GBP 1.4 billion. The firm sold 493,000 shares in the offering for GBP 6.4 million, and still owns 2.3 million shares worth GBP35.7 million at the price at that time. (http://on.wsj.com/l3Xu5d)

Other notable deals Index was involved with include MySQL, where they contributed to a Series B funding round of $19 million USD. MySQL were acquired by Sun Microsystems in 2008 for $1 billion USD. They also led the Series A funding round for Last.fm, injecting $5 million USD. The company was acquired by CBS for $280 million USD in an all cash deal in May 2007.

Requirements for capital investments in start-ups
Index Ventures invest in all sectors with a primary focus on information technology and life sciences companies. However, subsidiary focuses also include green technology, biotechnology, and consumer and internet infrastructure companies. They are committed to investing in companies across the growth spectrum, from larger Series A or B rounds to seed stage funding. They are able to invest anything from €50,000 to €50 million in seed, early- stage and late-stage companies. Their commitment, relatively unusual particularly for a large VC firm, to seed stage funding was highlighted by the establishment of the Index Seed fund in 2010 and the fact that they have invested in over 30 seed deals over the last five years. They are also open to investing in more established businesses looking to accelerate their growth.

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