Dividend Policy and Dividend Decision Theories.pptx
Overview 2o census Brazilian PEVC 2009 GVcepe
1. Brazilian Private Equity and
Venture Capital Industry
Second Census_2009
Prof. Adalberto Brandão
COO of GVcepe
adalberto.brandao@fgv.br Nov/2011
Copyright @2011. Fundação Getúlio Vargas - GVcepe
2. The Second Census Project
The Second Census Project
Gather and interpret data to reflect the reality of the Brazilian PE&VC
industry and its impact on the economy.
80%
of industry
participants surveyed
180 144
PE&VC
Managing Surveyed
Organizations
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 2
3. Industry Overview as of December 2009
• US$ 36.1 bn Committed Capital
• Main LPs: Pensions 22%, Parent Orgs.
Investors
18%, Endowments 10%, GP Orgs 9%,
Family Offices 9%
• 144 PE&VC Firms
• General Partners
258 Investment Vehicles
• Est. 1,593 Professionals & Staff
• 502 portfolio cos., Dec 09
• 2005-2009 Period:
Portfolio Companies
• 414 new investments
• 103 total exits
• 39 IPOs
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 3
4. Expansion of the Asset Class
Committed Capital allocated to Brazil (US$ Bn). Committed Capital as % of GDP
40 2.3% 2.5%
36
35 2%
2%
30
15% p.a
25
27 1.5%
20 1.2%
1% 2x
15 1%
10 13
2x 0.5%
5
6
0 0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
The evolution of committed capital is impressive, increasing more than 6 times since 2004
and 2 fold as percentage of GDP.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 4
5. Committed Capital
December 2009 (US$ MM)
Types Private Govt. Total % Committed Capital Dec. 2008 28,984
Traditional * 27.168 935 28.103 78%
Fundraising (Vehicles in US$) 3.093
Corporate Venture ** 350 - 350 1%
Fundraising (Vehicles in R$) 2.979
Infrastructure *** 3.955 - 3.955 11%
Reductions (Vehicles in US$) -1.531
Real Estate 2.734 - 2.734 8%
Reductions (Vehicles in R$) -732
Timber 970 - 970 3%
Exchange Rate Effect 3.318
Total 35.177 935 36.112 100% Committed Capital Dec. 09 36.112
* Investment vehicles with focus on manufacturing, trade, services, agriculture and traditional businesses.
** Subsidiaries of industrial corporations.
*** Investment vehicles dedicated exclusively to oil & gas, energy and self defined infrastructure funds.
NOTE: Reductions refer to discontinued operations, termination of funds, allocation to Brazil changes and reductions of committed capital
by investors.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry 5
6. Diversified Fund Investor Base
Committed Capital by Investment Main Types of Investors
Vehicle’s Legal Structure
Corporate Other 7%
Ventures 1%
Direct
Investment
15% (excludes
Hedge Funds)
Limited
Partnership
37%
Holding cos.
4%
CVM* 26%
* All vehicle structures according to Brazilian PE&VC regulation CVM 391, 209, 402.
NOTE: Parent Organization includes Corporate Ventures and Banks’ captive PE&VC subsidiaries.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 6
7. Investment and Fundraising (US$ bn.)
Estimate of US$ 17.8 bn. of ”Dry Powder” ready to be invested as of December 2009
Notes: Fundraising based on sample of 258 investment vehicles by 144 PE&VC Managing Organisations.
Investment based on Sample of 394 and 95 Investments made by 144 and 45 PE&VC Managing Organisations in 2005-2008 and 2009 respectively.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 7
8. Investments by Sectors of Economic Activity (US$ MM)
2005-2008 (Includes New and Follow-on Investments)
Food and Beverages 24%
Various Industries* 14%
Civil Construction/Real Estate 13%
Retail 12%
Financial Services 11%
Energy and Oil 4%
Education 4%
Communication 4%
Agribusiness 3%
IT and Electronics 3%
Pharmaceutical/Medical/Aesthetics 3%
Entertainment/Tourism 2%
Extractive Industries 2%
Infrastructure - other 1% * Various Industries: E.g.: Chemicals, Mechanic, Electric,
Metallurgic, Packaging, Textiles.
Sample 2005-2008: 394 investments by 144 PE&VC Orgs. ** Various Services: E.g.: Call Center, Consulting.
Sample 2009: 95 investments by 45 PE&VC Orgs.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 8
9. Investments by Sectors of Economic Activity (US$ MM)
2009 (Includes New and Follow-on Investments)
Energy and Oil 54%
39%
10%
Financial Services 14%
9%
Entertainment/Tourism 11%
6%
Extractive Industries 8%
5%
Transportation and Logistics Services 7%
5% Including all investments
Education 6%
3%
Agribusiness 4%
Excluding one US$ 0.765bn
Infrastructure - other 2% investment in energy transmission
Various Services** 2%
Pharmaceutical/Medical/Aesthetics 1%
Food and Beverages 1%
Retail 1%
* Various Industries: E.g.: Chemicals, Mechanic, Electric,
Various Industries* 1%
Metallurgic, Packaging, Textiles.
IT and Electronics 1% ** Various Services: E.g.: Call Center, Consulting.
1% Sample 2005-2008: 394 investments by 144 PE/VC Orgs.
Civil Construction/Real Estate Sample 2009: 95 investments by 45 PE&VC Orgs.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 9
10. Number of Investments by Sectors of Economic Activity
2005-2008 vs. 2009 (Includes New and Follow-on Investments)
15%
IT and Electronics 18%
Energy and Oil 15%
11%
Pharmaceutical/Medical/Aesthetics 14%
8%
Agribusiness 11%
7%
Various Industries* 9%
6%
Various Services** 8%
Transportation and Logistics Services 6%
Biotechnology 5%
3% 2009
Retail 4%
4% 2005-2008
Financial Services
Entertainment/Tourism 4%
Civil Construction/Real Estate 4%
Education 3%
Extractive Industries 2%
* Various Industries: E.g.: Chemicals, Mechanicals,
Food and Beverages 2% Electric, Metallurgic, Packaging, Textiles.
** Various Services: E.g.: Call Center, Consulting.
Infrastructure - other 1%
1% Sample 2005-2008: 394 investments
Communication
Sample 2009: 95 investments
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 10
11. Investments by Stage and Type 2009
Number of Investments Average Ticket
(Includes New and Follow-on Investments) (US$ MM)
3% 1% Stage Average Ticket
5%
Private Equity
Seed/Start-up 0.42
4% 41%
Venture Capital 4.41
Venture
15% Greenfield 46.64
Capital
Mezzanine 50.22
Seed/Start-up
Distressed 64.37
Private Equity 73.41
Greenfield
PIPE 91.77
31%
Total 39.39
Mezanino
Sample: 95 investments Sample: 77 investments
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 11
12. New Investment Vehicles Raised
50 47
45
40 37
35 31
30
25
19
20
15 11 13
9 10 8
10 7 7 7 7
5 1 3
0
95 and 1997 1999 2001 2003 2005 2007 2009
before
30 to 50 new investment vehicles raised p.a. since 2008, vigorous entry and expansion in the
industry.
Sample: 215 Investment Vehicles reported by 120 PE/VC Orgs.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 12
13. Portfolio Companies
By Sector of Economic Activity 2009
Sector No. of Companies % Cumulative %
IT and Electronics 103 20.5% 20.5%
Civil Construction/Real Estate 69 13.7% 34.3%
Energy and Oil 56 11.2% 45.4%
Various Industries 55 11.0% 56.4%
Communications 33 6.6% 62.9%
Retail 26 5.2% 68.1%
Agribusiness 25 5.0% 73.1%
Transportation and Logistics Services 20 4.0% 77.1%
Food and Beverages 19 3.8% 80.9%
Infrastructure - other 19 3.8% 84.7%
Financial Services 16 3.2% 87.8%
Pharmaceuticals, Medicals and Aesthetics 15 3.0% 90.8%
Biotechnology 14 2.8% 93.6%
Various Services 10 2.0% 95.6%
Education 8 1.6% 97.2%
Entertainment / Tourism 7 1.4% 98.6%
Extractive Industries 7 1.4% 100.0%
Total 502 100.0%
* Various Industries: E.g.: Chemicals, Mechanicals, Electric, Metallurgic, Packaging, Textiles. Sample of 502 companies in 2009.
** Various Services: E.g.: Call Center, Consulting.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 13
14. Frequency of Portfolio Companies
by Stage 2009
Overview PE - Growth 36,5%
VC 47.0%
VC - Early Stage 20,9%
PE Growth 36.5%
Start-up 13,1%
PE Later Stage 6.9%
Other 10.1% Seed 7,6%
PE - Later Stage 6,9%
PIPE 6,2%
VC - Later stage 5,0%
Mezzanine 2,1%
Greenfield 1,6%
Distressed 0,2%
Sample: 436 companies in 2009 .
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 14
15. Closing the Gap: Potential for PE/VC
investment in innovative opportunities
PE/VC Portfolio Companies
Geographic Distribution Incubators and Tech Parks
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 15
16. Exits & Divestitures
70 Divestitures 2005 - 2009 (Including Total & Partial)
61
60 2
48 15
50
42 4
3 37
40 3
4
24 12 4
6 Write-off
30 27
8
1
10 Buyback
5 12
20 11
Trade Sale
4
10 6 Secondary
17 19 16 10 Sale
8 IPO
4
0 1
2005 2006 2007 2008 2009
NOTE: the sample contains 151 divestitures (107 total & 44 partial) from 2005 to 2008 & 37 divestitures (30 total & 7 partial) in 2009 with information about the
exit mechanism.
Copyright @2011. Fundação Getúlio Vargas - GVcepe Source:2nd Census of the Brazilian PE&VC Industry – ABDI/FGV 16