28 November 2014

Angels tempted by German recipe and ingredients retailer in November

Decreased volume of angel investments in European companies in November to date has not stopped value from reaching the same level as October, in spite of there still being around ten days left before the end of the month at the time of writing. So far there have been 17 angel investments worth a combined EUR 77 million into European companies this month. Although volume was much higher in October, when 50 transactions were recorded, value was the same at EUR 77 million, suggesting higher individual valuations this time around. As such, it looks likely that November will go on to exceed last month’s result if further deals are announced in the next ten days. Interestingly, volume has plumbed its lowest depth since August 2012, even though value is at one of its highest levels of the last two years; since the beginning of 2013 the EUR 77 million monthly figure has been beaten only twice, in June 2013 (EUR 78 million) and May 2014 (EUR 133 million). Value-wise the situation is relatively similar to a year ago; in November 2013 EUR 73 million was injected into European companies by angel investors, although this was across almost double the number of deals (30). The same pattern is evident on a quarterly basis; in Q4 to date EUR 154 million has been invested in 67 transactions, compared to EUR 125 million over 100 deals in Q3. As with the monthly results, value has already trumped the previous period, and with just over a month to go until the end of the year, the improvement is likely to be even more pronounced by the time January rolls around.

As with previous months which performed impressively, a sizeable portion of the EUR 77 million invested into European companies by angel investors in November can be attributed to a single transaction. UK-based Quanta Fluid Solutions, a developer of home haemodialysis medical equipment, received just over EUR 34 million from Air Liquide lnvestissements d'Avenir et de Demonstration, Seventure Partners, Wellington Partners, Seroba Kernel Life Sciences, NBGI Private Equity, b-to-v Partners and IMI. This single deal is worth 44 per cent of the month’s total investment. Quanta’s chief executive said proceeds would be used to bring its SC+ product, a portable, compact haemodialysis system, towards clinical introduction and commercial launch. The month’s second largest deal was also relatively large as France-based online men’s clothing retailer Menlook.com secured EUR 23 million from IDInvest Partners, BPI Groupe, Laurent Grosman and Marc Grosman. These two deals are significantly larger than the average angel investment and go some way to explaining November’s impressive showing.

Unsurprisingly, a large number of software companies received angel investment in the month under review, but there were also some which represent a break from the norm. One in particular stands out as German online recipe and ingredients retailer MarleySpoon was targeted. The firm closed a EUR 4 million Series A round led by GlobalFoundersCapital and Point Nine Management and also including a number of undisclosed angels. Proceeds are earmarked for the firm’s international expansion, although it is already active in the UK and the Netherlands, as well as its home country. MarleySpoon was launched in August 2014 by Fabian Siegel and Till Neatby and provides a weekly range of seven different meals developed by professional chefs. The menu changes every seven days and dishes and ingredients can be ordered online or via an iPhone application for delivery within a few days. MarleySpoon is quick to emphasise its emphasis on sustainability as all parcels are sent in recyclable packaging with exact portions to avoid wastage.

Although MarleySpoon is slightly different to the usual raft of software companies who regularly receive the interest of business angels, it is by no means the only company of its type to have been targeted worldwide in the last few years. In fact, one very similar business received an injection from angels only a few months ago. In August US online meals and food ingredients retailer DineInFresh, which trades as Plated, closed a EUR 12 million Series A round from Greycroft, Formation 8 Partners, ff Asset Management and Lerer Ventures, among others. This transaction represents the second-largest angel investment in a food retail company worldwide from 2006 to the present day. Top spot was taken by Redmart, a Singaporean online retailer of miscellaneous grocery products which received USD 17 million via a Series B round from Garena Online, Eduardo Saverin, Softbank Ventures Korea and Visionnaire Ventures. Redmart said it planned to use funds raised from the deal, which completed in July, to continue its growth and expansion while expanding its product range. Of all the global angel investments within the industry, the largest targeting a European company placed third overall as Swedish home delivery firm Mathem I Sverige brought in just under EUR 9 million from GP Bullhound and H&M chief executive Karl-Johan Persson in September 2013. Other countries from within Europe to have been targeted include Spain, France and Germany.

To sum up, a few high value injections have resulted in an impressive showing in terms of the aggregate value of European angel investment in November. Volume was disappointing, but as long as investors continue to dig deep to get the investments that matter most to them we can hope to see value continue on the upward trajectory which has been notable in recent months.

© Zephyr