25 March 2015

French electronics firm among March’s angel investments

So far in 2015 there have been a series of peaks and troughs in terms of European angel investment, according to Zephyr, the M&A database published by Bureau van Dijk. In March there has been a decline in both volume and value, as EUR 34 million was invested across 22 deals, compared to 54 transactions worth EUR 124 million in February. At the time of writing there are still 11 days until the end of March, so it is perhaps not surprising that figures are down on last month. However, if results are to get anywhere near those recorded in previous months there will need to be a considerable uptick in deal activity in the run up to the end of the quarter. At present March is the lowest-performing month in terms of volume since February 2013 and the lowest by value since December 2013. However, March 2014 posted similar results as EUR 38 million was invested across 29 deals. In addition, the big drop from February 2015 is more noticeable as it was a month with notably large investment value, reaching the highest point since May 2014 (EUR 134 million across 45 deals).

The decline on February can be attributed to lower individual considerations overall. March’s largest transaction was an EUR 11 million Series B funding round by UK-based solar cell technology developer Oxford Photovoltaics from new investors in the UK, the US, Asia and Europe, as well as existing investors such as the University of Oxford, MTI Partners, Longwall Venture Partners, Parkwalk Advisors and a range of undisclosed angels. Even though this is relatively small considering it is the month’s top European angel investment, it still accounts for almost a third of total investment for March to date at the time of writing. March’s second-largest deal was more than 50 per cent smaller as Italian online ticket booking platform operator Musement brought in EUR 5 million as part of a Series A round from P101, 360 Capital Partners, Francesco Micheli Associati, and Italian Angels for Growth. Quite a wide range of values were recorded in European angel investments in March, ranging from the high of EUR 11 million to a low of just EUR 70,000.

Unsurprisingly, the software sector was a big winner when it comes to angel interest in the month under review, but it was by no means the only industry to have been targeted. One notable investment was in the consumer electronics sector as French 3D sound headphones technology maker 3D Sound Labs secured an injection of just over EUR 1 million from i-Source Gestion, Paris Business Angels, Bretagne Sud Angels, Femmes Business Angels, Finistere Angels, Logoden Particpations and Armor Angels. The Cesson Sevigne-headquartered business is in the process of developing Neoh, which it claims will be the first headset to provide a spatial sound rendering system, thereby giving the listener a sound closer to reality than any other device. The firm has compared the product, which can be used with home cinema systems or simply to listen to music, to the latest generation of movie theatre surround sound technology. In addition to the angel injection, 3D Sound Labs has also completed a Kickstarter round, raising USD 125,171 in the process, well above its target of USD 80,000.

According to Zephyr there have been nine angel investments in the consumer electronics industry worldwide since the beginning of 2006, of which the two largest both involved Beats Electronics, the headphone manufacturer founded by Jimmy Iovine and rapper Dr Dre. Although the business has grown at a rapid rate and has been owned by Apple since August of last year, it initially secured EUR 46 million from Access Industries, Marc Rowan, Lee Bass and James Packer, among others, in March 2013. This was followed by another round about a year later when Access Industries, alongside the founders, injected EUR 43 million. Other consumer electronics players to have been targeted by angels include French high-performance designer audio devices manufacturer Devialet, which brought in EUR 15 million from Bernard Arnault, Marc Simoncini, Xavier Niel and Jacques-Antoine Granjon, as well as other existing investors, in November 2012.

To sum up, March has been a fairly quiet month, but with 11 days until the end of the quarter at the time of writing there may yet be an increase in activity. The positive result from February will leave many with high hopes of continuing improvements in the market and further sustained increases in investment levels throughout the rest of 2015.

© Zephyr