Highlights of 2011
The first half of 2011 was a good time to invest in and exit high-growth companies; the second half has been more challenging but it is still possible to find innovative companies of real quality to back and, with many larger corporates sitting on cash piles and looking for strategic acquisitions, it is still possible to sell companies with long-term growth prospects. Amadeus achieved six notable exits through 2011, including:
Forth Dimension Displays: from first round finance to acquisition by major US corporation
The year began with the $11 million sale of Forth Dimension Displays (ForthDD) to NASDAQ-quoted Kopin Corporation (www.kopin.com), the US-based nano-semiconductor company. ForthDD develops and manufactures silicon-based micro-displays for high-performance, near-to-eye and projection applications. Amadeus has supported the company since first round investment in 2004, since when ForthDD has successfully developed and commercialised its proprietary ultra-high-resolution, reflective micro-display for applications ranging from high-performance cinematography to training and simulation and medical imaging.
Icera acquired for $367 million by NVIDIA: a perfect global fit
Pioneering UK semiconductor company, Icera, was sold for $367 million to NASDAQ-quoted NVIDIA (www.nvidia.com). Amadeus first invested in Icera in 2006, having previously backed the CEO, Stan Boland, at Element-14, which was acquired by Broadcom for $600 million. In the five years of Amadeus’ support for Icera, the company built a strong reputation for its innovative soft modem platforms for next-generation mobile phones and wireless terminals and developed a break-through baseband processor and advanced wireless modem technology for high performance, low power multi-mode wireless devices. NVIDIA has a global business in graphics processing units and chip set technologies for workstations , PCs and mobile devices. Icera’s technology and NVIDIA’s products are a great fit.
Transmode: a rare European IPO in 2011 – and still trading above the offering price.
Stockholm-based Transmode Holdings (www.transmode.se) floated on the NASDAQ OMX Stockholm, raising SEK 530 million ($85 million) in an over-subscribed placing that capitalised the company at SEK 1.427 billion. Transmode, through the ten years of Amadeus’ support, built a pre-eminent position in resolving, for fixed and mobile network operators, the capacity constraints created by the rapid growth in video and data traffic. Its products have become critical building blocks in the high-speed optical networks that support services such as broadband backhaul, mobile data backhaul, video delivery services and cloud computing. The company’s shares at year end continue to trade about their initial offering price.
Clearswift: a steadily built global company acquired by mid-market investor
Global digital security software company, Clearswift (www.clearswift.com), was bought by UK mid-market growth investor, Lyceum Capital. Headquartered in the UK, with satellite operations in Germany, Spain, Japan, the US, Australia and Holland, Clearswift boasts a diverse and international base of some 17,000 customers in almost 50 countries. Customers include BAE Systems, Hitachi Solutions and Australia Postal Service. As Amadeus Partner, Richard Anton, said: “Clearswift has come a long way since our first round investment, through acquisition, building the product range, international expansion and, most recently, moving to a subscription-based revenue model. The company is well-positioned for its next phase of growth with a mid-market investor and we wish the team all success.”
Xelerated: an end of year sale to a global corporate
Late in the year, Amadeus agreed to sell its stake in Xelerated (www.xelerated.com), a leading technology innovator in network processing and programmable Ethernet switching products, based in Stockholm and California, to NASDAQ-quoted Marvell Technology Group, a worldwide leader in integrated silicon solutions. Amadeus first invested in Xelerated in 2005 and has supported the company’s product development and business expansion since then. The company’s products, used in the design of Carrier Ethernet, Unified Fibre Access and Mobile Backhaul platforms, are deployed by eight out of ten of the world’s largest telecom equipment vendors. Following the sale of Icera, Xelerated is Amadeus’ second profitable semiconductor exit in 2011.
We have also made some new investments, some of which have not been announced while they develop their technologies and business models. But we did announce:
Nyx Security (www.nyxsecurity.com), a Nordic company providing its own network-based camera systems for real-time surveillance and monitoring, delivering greater security more cost-effectively than other alternatives. The company had achieved strong growth, with a customer base that included Statoil’s fuel stations and PEAB, a Nordic construction company. Nyx also has channel partners including Securitas in Sweden. We invested part of a 100m SEK round.
$1.2 million early stage funding in TrialReach (www.trialreach.com), an innovative search business whose website helps patients with any medical condition to explore, understand and access information on clinical trials anywhere in the world. TrialReach’s unique website combines a specialised search engine, exclusive patient-friendly information and fast communication channels between patients and physicians to make clinical trials easy to find, easy to understand, and easy to access.
At the end of the year, we completed our investment in social media distribution company, Unruly (www.unrulymedia.com) – announced in the first days of January – as part of a $25m first institutional round that we co-led. Unruly has built a European market lead and made a great start establishing in the US in this rapidly growing market sector , not least due to its unique video interaction analysis, which enables clients to match content to the optimal publisher for maximum brand engagement. We believe its ambitious plans for growth are achievable and will create a significant global business. The company is already profitable on revenues of $25m (2011 full year).
Among our portfolio companies, highlights include:
Artificial intelligence company, aiHit (www.aihit.com) attracted an investment of $5.5 million from Russia’s VTB Capital, a major vote of confidence in this fledgling company built with support from the Amadeus & Angels Seed fund. aiHit has created a fully automated data management system that can extract, structure, analyse and manage unstructured data from the web. Customers include Capital IQ, Dun & Bradstreet and Datamonitor. Aidar Kaliev, Head of VTB Capital’s venture business said: “aiHit has invented a new way to extract, manage and analyse raw data which, we believe, will change the way the industry operates.”
Open source ERP software company, Openbravo (www.openbravo.com), launched version 3 of its product in June. This is a leap forward and the market has responded very well.
EnQii, a global leader in the digital signage and out-of-home media market,merged with Minicom Digital Signage, to form ComQi (www.comqi.com). The merged entity offers a seamless platform to the Digital-out-of-Home (DooH) advertising market, providing an integrated suite of hardware, software and services required for large sophisticated digital signage deployments. EnQii-MDS operates from six offices around the world working in conjunction with a global network of dedicated partners that includes 150 worldwide distributors serving thousands of re-sellers and system integrators.
Israeli network security company, ForeScout, achieved a major milestone in making it to the leaders’ quadrant of the Gartner magic quadrant. See the home page (www.forescout.com) for the report. The company has also achieved a number of major client wins and new partnerships, most notably with McAfee and HP Arcsight.
And some other happenings
In March, Richard Anton, one of our Partners, was made 2011-2012 Chairman of the British Private Equity & Venture Capital Association (BVCA), having served on the BVCA’s Council for four years. Richard brings to this high-profile role 15 years of venture capital experience, both at Apax Partners and Amadeus, and has been a vocal advocate for the venture sector during his chairmanship.
Meanwhile, Anne Glover, Amadeus CEO and a former BVCA chairman, continues to work as a leading member of the EVCA’s Venture Capital Council, frequently presenting the case for EU support for innovation at the highest levels in Brussels. She also continues to sit on the Governing Board of the UK Technology Strategy Board.
Hermann Hauser continues to serve on the Prime Minister’s Council of Science and Technology. He is also working with Cambridge University and the Royal Society on Technology Transfer and Entrepreneurship. In June, Hermann received an SDForum Visionary Award. Each year, the SDForum in San Francisco honours industry leaders who have pioneered innovation and fostered entrepreneurship. Hermann was selected for his “exceptional contributions in the field of emerging technologies and in the community”. Past award recipients include Bill Gates, Lou Gerstner and Vinod Khosla.
As we go into 2012
2012 may well be as challenging as 2008, with so much economic uncertainty in both Europe and the US and a real possibility of another credit squeeze for growing companies – and let’s not forget that these companies are the engine of Europe’s and the US’ economies. Equity finance remains one of the few sources of capital available to innovative companies and we and other venture and growth capital firms are well-positioned to support such businesses in this environment.
From seed finance through to venture buyouts, Amadeus continues to support technology innovation across Europe