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July 25, 2006
Europe's Recent Homeruns: Bootstrapped vs VC-backed
We have a lot of respect for bootstrapped ventures at the a:c euro and so does Max Bleyleben at Kennet Ventures -- mind you it is for different reasons -- Bleyleben because he wants to invest in owner-funded startups -- and us because we know how challenging it is to build a quick growth company in Europe.
In an article making the case for startups that can get to profitability without burning a lot of cash, he writes: for every venture-backed Skype or Kelkoo, there’s a bootstrapped uSwitch or Friends Reunited. All four represent so-called homerun exits for Europe.
The a:c euro provides the prices paid at exit for these ventures from publicly available source below, as it's not mentioned in the piece -- the article was written for Real Deals magazine whose readers would know well the prices paid because they have seen hundreds of powerpoint slides pointing out these homeruns.
(Full Disclosure: the a:c euro's team leader performs research for Real Deals transaction database Done Deals.)
=> Skype acquired by eBay for $2.6B plus $1.5B earnout
=> Kelkoo acquired by Yahoo $579M
=> uSwitch acquired by $366M
=> Friends Reunited acquired by ITV for £120M (€175 M) in cash and shares, plus a £55M earnout.
Bleyleben could also have mentioned other examples of ventures that grew without early stage VC, such as Meetic, which raised one round of capital from AGF Private Equity a year prior to its Euronext IPO and currently has a market cap of €389M (it's capitalization went as high as half a billion but has fallen lately to the figure quoted).
Or some of the Euro tech ventures that went straight from bootstrapped to IPO without passing the VC or the expansion financing stage, e.g. TomTom, the navigation gadget maker (current mkt cap= €2.9B).
Read - The case for bootstrapping (real deals)
Read - Why we like bootstrapping (technofile)
Read - Bootstrap your business for growth (technofile)
Posted on July 25, 2006 07:15 AM | Posted to entrepreneurship | Permalink
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