The Florida Venture Forum, the Gulf Coast Venture Forum and the EDC of Sarasota are proud to present

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The Florida Venture Forum, the Gulf Coast Venture
Forum and the EDC of Sarasotaare proud to
present

• MARK G. HEESEN
• State of the Venture Capital Industry
• October 14, 2009
• Sarasota, Florida

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Thank you to our sponsors
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• State of the Venture Capital Industry
• October 2009
• Mark G. Heesen
• President

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Global Insight Study

• In 2008, venture backed companies
• Provided 12.05 million US jobs
• Had sales of 2.3 trillion
• Represents 20.5 of GDP
• Still dominated venture-created sectors
• 74 of telecommunications jobs
• 81 of software jobs
• 55 of semiconductor revenue
• 67 of electronics/instrumentation revenue

Source Venture Impact 2009 by Global Insight
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Fundraising Resources
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Capital under mgt firms peaked Industry
capital now 197B
Source NVCA 2008 Yearbook prepared by Thomson
Reuters
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VC Fundraising Matches Investment - Late 2008s
Denominator Effect Killed Fundraising (Less than
2B in 3Q 2009
Does not include Corporate Venture groups.
Source Thomson Reuters/NVCA
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Investment Marches On -Rumors that the
Venture Industry has stopped investing are
exaggerated
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VC Investment Peaked in 2000 2008 Was Down 8
1H09 was 6.8B
103B
28B
7B
Source PricewaterhouseCoopers/National Venture
Capital Association MoneyTree Report, Data
Thomson Reuters
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Investment Started Slowing Considerably in 3Q08
from a 5-year Steady Slow Growth
Source PricewaterhouseCoopers/National Venture
Capital Association MoneyTree Report, Data
Thomson Reuters
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Clean Technology investment grows
significantly2008 4B in 286 Deals
Source PricewaterhouseCoopers/National Venture
Capital Association MoneyTree Report, Data
Thomson Reuters
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Despite the recession Q4, VCs funded 1,202 new
companies in 2008 Very slow YTD .
Source PricewaterhouseCoopers/National Venture
Capital Association MoneyTree Report, Data
Thomson Reuters
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Florida is currently ranked 17th for overall
venture capital investment.
Venture Capital Investment In Billions 2008 State
Ranking
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Venture-backed companies are a critical engine of
economic growth for Florida.

• From 1970 2008 venture capitalists invested
  10.2 billion in 639 companies in FL.
• Public companies headquartered in FL that were
  once venture-backed account for 242,074 jobs and
  76 billion in revenue.
• FL ranks 11 in jobs and 9 in revenues at
  venture-backed companies headquartered in the
  state.
• One U.S. job was created for every 42,135 of
  venture capital dollars invested in the state of
  Florida.

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According to 2009 Global Insight study
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Annual average venture capital investment in
Florida from 2003-2008 was 400 million.

Companies
Billions
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2000 numbers reflect technology bubble
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Florida venture-backed companies receiving top
funding in 2008 represent a broad range of
industries.
Top venture-funded FL companies - 2008
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The highest venture funded industries in Florida
are software, telecom, and energy.
VC Investment in FL - Industry Breakout - 2008
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93 of venture capital investment intoFL
companies comes from out of state.
In 2008, venture capital dollars invested in FL
companies came from venture firms headquartered
in
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The Exit Scene - the importance of acquisitions
has become clear over the past several years
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IPO Levels Were Good in 2004 and Okay in 2007
Awful Now
Source Thomson Reuters/National Venture Capital
Association
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Whats in the IPO Pipeline?Dismal Short
TermDont confuse uptick with recovery
Source Thomson Reuters/National Venture Capital
Association
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VB Acquisition Counts Were Steady Down Now
Quality Varies
Source Thomson Reuters/National Venture Capital
Association
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MA Exits Arent Providing Much Liquidity Either
Source Thomson Reuters/National Venture Capital
Association
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Those Few Acquisitions Which Do Happen Are Not
Great
Source Thomson Reuters/National Venture Capital
Association Undisclosed txns are prorated
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Venture Exit Counts- IPOs and MA by Year
Source Thomson Reuters/National Venture Capital
Association
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Performance
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Venture Capital Returns Still Around 20 over
the long haul net to the LPs
Through Q2 2009 Except through Q1 2009
Source Cambridge Associates U.S Venture Capital
Index, the performance benchmark of the National
Venture Capital Association
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Public Policy andThe Venture IndustrySome
Wins Many Challenges
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American competitiveness ...

• More people will graduate in the US in 2006
  with sports-exercise degrees than electrical
  engineering degrees.
• So if we want to be the massage capital of the
  world, were well on our way

• Jeffrey Immelt
• CEO of GE in a
• 2006 Globalist interview

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Key US VC building blocks ...Our Ecosystem!

• Capital formation
• Prudent man rule enabled pension investment
• LP laws
• Capital gains tax reduction
• Empowered entrepreneurs
• Capital gains tax reductions
• Stock options/team building tools
• Reasonable bankruptcy laws
• Protect companies IP laws
• Abundant customers willing to do business with
  SMEs
• Exit markets the NASDAQ
• Face-to-face investing/proximity
• Cultural acceptance

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Buy low sell high is easier if you really buy
low!
Source PricewaterhouseCoopers/National Venture
Capital Association MoneyTree Report, Data
Thomson Reuters
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• www.nvca.org