25 April 2015

Portuguese software publisher targeted by angels in April

2015 has so far offered a mix of results for European angel investment, according to Zephyr, the M&A database published by Bureau van Dijk. In April to date there have been drops in terms of both volume and value as just EUR 18 million was injected across 10 transactions, but there are still ten days until the end of the month at the time of writing and plenty of time for a number of sizeable investments to be signed off. By value April is currently the lowest month since December 2013, when just EUR 16 million was invested by angels. Volume is currently at its lowest since January 2011, when 6 deals were announced, but it would be surprising if the next ten days do not bring enough investments to push that figure closer to those of recent months. At present volume is down 78 per cent on March 2015 and 85 per cent by value. Last month 46 transactions worth a combined EUR 122 million were announced. February was similar (54 transactions at EUR 124 million) while January was lower (52 deals at EUR 42 million).

Low volume, combined with relatively disappointing values, have contributed to the decline in April so far. The largest deal of the month to date is an EUR 8 million Series A round of funding by UK-based online mobile payments application developer Just Yoyo from Imperial Innovations Group and a number of undisclosed angels. Although the top deal has been significantly larger than this in many previous months, this transaction alone accounts for 44 per cent of all European angel investment in April to date. The month’s second-largest deal was significantly smaller as Spanish online ticket reservation platform operator Ticketbis brought in EUR 3 million via a fifth round of investment from Active Venture Partners, AngelList and existing shareholders Fabrice Grinda and Jose Marin. The month’s deals took in a fairly wide range of values, from the aforementioned high of EUR 8 million to a low of just EUR 60,000 as Spanish industrial network platform operator CBD Click secured investment from undisclosed angels.  

A significant portion of the deals signed off in April targeted the software industry and while the UK, Spain and France were among those targeted across a number of deals, a Portuguese company also featured. Braga-headquartered Cloud9Im has developed the MusicYou app, which is designed to help users share music with one another privately, without it being displayed in a public feed. It is hoped this will encourage people who would not share content in a more open forum like Spotify to share it with those with similar tastes in a more private setting. Cloud9Im has secured a seed round of EUR 300,000 led by Smart Equity and also including Brains2market – Participacoes. According to a TechCrunch report on the injection, the company has also signed an exclusive deal as promotional partner for the MEO SW music festival, which is scheduled to take place near Zambujeira do Mar.   

Unsurprisingly there have been a significant number of angel injections into the software publishing industry worldwide since the beginning of 2006. The largest of these deals had a very high value for an angel investment as Brazil-based Sontra Solucoes Em Transporte, a provider of online courier and delivery services, raised EUR 240 million from Mola Factory, NXTP Labs and senior executives from JP Morgan, Bank of America and DHL in July 2013. The industry’s second-largest transaction of the period worldwide was considerably smaller as US diagnostic and therapeutic imaging software developer Butterfly Network secured just under EUR 80 million from Aeris Capital and Jonathan Rothberg in November of last year. The firm said it intends to use the proceeds to capitalise on advances in semiconductors, deep learning and cloud computing to improve its medical imaging and non-invasive surgery technology.

In conclusion, April has been another quiet month, but as in previous months it is certainly likely that a few more deals will be signed off before the start of May, which should push angel investment levels in Europe back up to recent levels.

© Zephyr