Private equity techs best kept secret

Private equity – tech's best kept secret

In this guest post Victor Basta, managing director of boutique investment bank Magister Advisors and a specialist in the technology sector, examines the surge in private equity-backed late-stage technology funding, and the implications for the sector.

What happens when fintech valuations come back down to Earth

What happens when fintech valuations come back down to Earth?

In this guest post Victor Basta, managing director of boutique investment bank Magister Advisors and a specialist in the technology sector, argues that we'll see fintech valuations fall steeply across the board this year.

Digital Banking, a tough way to make money - as seen in FT Alphaville

Digital banking: a tough way to make money

It’s been a busy period for the UK’s fledgling digital banks. Since January, eight UK digital banks have collectively raised $600m and two challenger banks were acquired for $2B+.

To be hugely successful study failures

To be 'hugely successful,' study failures

Business coaching and success podcasts are a huge global industry. American coaches collect $1B+; no wonder 3x as many coach today as 10 years ago. And the number of 'how to succeed in business' podcasts are too many to count.

Immigration = Value

A Handful Of Immigrants Can Double The UK’s Economy

Our migration debate hardly mentions ‘immigrant founders,’ yet I believe they hold the key to the future of the UK’s strategic tech industry, and the UK economy by extension.

Who needs ICO's

Who Needs ICO’s? Fin-tech’s Next $100B Opportunity

The ICO (cryptocurrency financing) debate may grab headlines, but there is a far greater, more valuable, and ultimately more transformational opportunity that remains hidden from headlines.

How to use core values to build a great company

How to use core values to build a great company

So many books have been written about how to win in business. The simplest way, in my experience, is to use core values fully in an organisation. It’s also one of the hardest things to get right.

Fin Tech Is Becoming Over Valued, Risking Future Exits

Fin-Tech Is Becoming Over-Valued, Risking Future Exits

Perhaps the single biggest tech investment area the last 5 years has been fin-tech. In Europe and the US, disruptors of everything from lending to foreign exchange have raised unprecedented capital to challenge banks and their kin:

For AI Startups more funding is often not the answer

For AI startups, more funding is often not the answer

One of the hottest areas for VC investment is AI/ML; artificial intelligence algorithms, related machine learning systems, neural networks, and back-end processing to produce insightful and self-learning applications.

Berlin not London is Europe's SV

Berlin Not London Will Become Europe’s Silicon Valley

London has been the undisputed European technology centre. Until now. Our view is Berlin will rapidly begin to take over, and in 10-15 years we will see the Berlin cluster as Europe’s technology hot-bed.

Why the hung parliament isn't a big deal for UK tech

Why the hung parliament isn’t a big deal for UK tech

Confusion reigns about the impact a hung parliament will have on business confidence and, of course, whether the nation’s plans for Brexit will change. Naturally, this concern is magnified for sectors driving UK economic growth, with the tech and financial sectors foremost among them.

Should VC's invest in fin tech? The case for

Should VC’s Invest In Fin-tech? The Case For “No”

Since 2011, $60B of VC investment has gone into fin-tech globally. That’s 7,000 funding rounds, a staggering collective commitment by the venture industry to the future disruption of banking, trading and payments.

M&A accelerates in the gig economy

You have to go big to serve small: M&A accelerates in the gig economy

In recent weeks on both sides of the Atlantic ‘gig economy’ companies have consolidated at an accelerating pace. IAC has led the wave, acquiring Angie’s List after two years of courtship for $500m, after buying a smaller UK business only a few weeks before.

Hedge Fund Managers

Is this the end of venture capital as we know it?

We are in a perverse moment in the global venture capital industry: VCs are fast coming to resemble private hedge funds, and the more money they are able to raise, the worse-off startups are becoming. Capital is flowing into funds of all types, yet the rate of investment is shrinking rapidly.

Chinese investors, best or worst?

Are Chinese investors the best or worst thing ever for the tech sector?

The recent bankruptcy of online auction house Auctionata Paddle8 and the very public failure of the UK’s ‘challenger’ Tandem Bank to close its Chinese-investor round share one trait: both were affected by Chinese investors who failed to fund at the last minute.

Power management is the most valuable tech segment no one is talking about

Power management is the most valuable tech segment no one is talking about

Power management should be viewed as one of the largest single segments in the global IT industry, and a major source of future ‘unicorns’ (companies worth $1B+). We see the power sector being broken into two categories: those addressing the mobile device/network segment, and general power technologies for other applications.

Brexit has killed the London Tech IPO

Brexit Has Killed the London Tech IPO

Taking a successful tech company public on a London stock market has always been harder than onto NASDAQ. The market is much smaller, and the level of tech knowledge amongst bankers and analysts far less deep than US peers.

AI M&A, funding reach new highs but the peak is yet to come

AI M&A, funding reach new highs but the peak is yet to come

AI M&A, Funding Reach New Highs But The Peak Is Yet To Come. We believe AI will shortly cease to exist as a segment, shifting M&A activity from current ‘capability buys’ to much higher value ‘platform buys’

Hottest sector for late stage tech investing

The Hottest Sector For Late Stage 'Tech'​ Investing In Europe?

Europe is much further behind the US in late stage tech investing than it appears. Late stage tech funding is far behind the US, and surprisingly over ⅓ of funding rounds in Europe target non-tech e-commerce or marketplace businesses.

Look East Not West

Look East Not West

European tech can benefit hugely from Asian investors refocusing away from the US. We think 2017 will be a watershed year for Asian investment into European tech.

Perversely we think the most active ‘European’ destination will be the UK.

Magister Advisors year end tech M&A analysis

Magister Advisors year end tech M&A analysis

European technology has come of age in 2016, according to M&A advisory firm Magister Advisors’ annual review of the European technology M&A and investment landscape. Total M&A deal value has more than doubled in Europe in the last 12 months to $127.2BN.

Who can challenge the biggest social networks in the next decade?

Who can challenge the biggest social networks in the next decade?

Surprisingly, Payment Service Providers. It must be the hardest job in tech to raise money for a new social network. Facebook and Google together now command 2/3 of all new mobile ad spend, the life blood of any social network, leaving little room for anyone else.

Europe's Tech Industry is one of 2016's Biggest Winners

Europe’s tech industry is one of 2016’s biggest winners

The European technology industry has come of age in 2016, according to a recent Magister analysis. Unprecedented M&A interest from Asian buyers, together with a strong IPO market for the best European tech businesses, has driven a surge in “blockbuster” deals (greater than $5B+ in value).

Can Asian Investors Transform European Tech?

Can Asian Investors Transform European Tech?

Because China’s premier Xi Jinping loves football (soccer) local billionaires are falling over themselves buying European clubs. He must also love technology, judging by Chinese behaviour towards European technology companies.

Brexit uncertainty is the silent killer of uk tech

Brexit Uncertainty Is The “Silent Killer” of UK Tech

A Magister Advisors poll of the fastest-growing UK tech companies suggests half the key talent on average is British, 30% EU and 20% further afield. So Brexit’s uncertainty now demands half the UK’s best tech talent to rethink if they want to, or can, stay and perform.

Magister advisors europreneurs what if entrepreneurs ran europe

What if Entrepreneurs Ran Europe?

More entrepreneurs than ever are choosing to compete from Europe. 10 years ago most founders building international tech businesses would automatically move to the US.

Why Does Market-Tech Need To Consolidate?

Why Does Market-Tech Need To Consolidate?

Ad-tech or market-tech; call it what you will; the programmatic advertising and targeting industry has become a hugely complicated morass of 4,000 products, many with overlapping functionality and unclear benefits for end customers.

VCs are failing to ‘Buy Low, Sell High’

VCs Are Failing To ‘Buy Low, Sell High’

Venture capital investors across the US and Europe are failing to take full advantage of high-value “exit windows,” according to Magister’s 15-year analysis of VC and private equity (PE) exit activity. Our analysis suggests VCs are significantly better at investing than exiting.

The Connected Car Market has “Arrived”

The Connected Car Market has “Arrived”

GM just paid $1B+ to acquire 40-person self-driving technology vendor Cruise Automation; last year Continental AG paid $700m for Elektrobit’s automotive software business unit (full disclosure: Magister has advised Elektrobit).

Magister Update

Magister Update

After 5 years, 18 successful deals and $2B+ of value generated, Magister is evolving into two separate entities.

Statement on Virtual Currencies to the European Parliament’s ECON Committee

Statement on Virtual Currencies to the European Parliament’s ECON Committee

Statement on Virtual Currencies to the European Parliament’s ECON Committee. I appreciate the opportunity to speak with you today and share my views on virtual currencies. I am a Partner with Magister Advisors LLP, an EU-based boutique investment bank we established in 2011.

Blockchain & Bitcoin 2016: A survey of Global Leaders

Blockchain & Bitcoin 2016: A survey of Global Leaders

As Bitcoin and Blockchain investment fast approaches $1bn, we have spent the last three months speaking with over 30 of the leading Bitcoin and Blockchain companies globally (with c. $500m of total investment), plus industry groups, financial institutions and investors, to gain detailed insight and understanding of the development of the market and the direction these fascinating technologies will take in 2016.

How can SaaS Companies achieve a $100m+ M&A Exit?

How can SaaS Companies achieve a $100m+ M&A Exit?

Software as a Service (SaaS) has matured. Its elder statesman, Salesforce, is worth over $50B and nearly every private software company is now SaaS. The reasons are clear. SaaS businesses have much more certain future revenue than older “perpetual license” businesses, and can therefore grow more reliably. Also, SaaS companies have regularly received very high investment valuations, generally 5-10x revenue, and SaaS is the only model many software investors will invest in.

How To Explain Square’s Disappointing IPO Pricing

How To Explain Square’s Disappointing IPO Pricing

Cries of “shock wave” and “bursting bubble” greeted Square’s recent IPO pricing. It’s understandable when the IPO is $2B lower than Square’s last round only months ago, in a stock market that has remained stable throughout the year.

Why e-Procurement may be the Hottest B2B Investment Sector

Why e-Procurement may be the Hottest B2B Investment Sector

$1 billion of funding has gone into e-procurement companies since 2011. 2015 could see another $1 billion of funding, 4 times all of 2014’s investment level and by far the most intensive rate of new investment the space has ever seen.

At $25 a share, Twitter is a Logical Acquisition Target

At $25 a share, Twitter is a Logical Acquisition Target

As Twitter dips below its IPO price, the business needs to execute a strategy urgently that utility platform to a real product business. At $25 a share, Twitter would be worth materially more to a larger business that can accelerate its product and feature innovation. An acquisition, in the absence of that innovation, would appear far more likely today than six months ago.

What the coming Tech Crash could look like

What the coming Tech Crash could look like

Fifteen years after the dotcom collapse we see another tech crash approaching. ‘Bubble’ and ‘unicorn’ are entering the mainstream vernacular. We are becoming comfortably numb with tech company overvaluations.

Mobile Travel Technologies acquired by Travelport

Mobile Travel Technologies acquired by Travelport

Travel technology leaders making opposite bets as industry seeks to transform: Magister Advisors advises Mobile Travel Technologies Ltd on its sale to Travelport.

How Banks can survive the Fintech Tsunami

How Banks can survive the Fintech Tsunami

The rise of next generation Fin Tech companies will trigger a wholesale restructuring of the banking sector. But banks can survive, maybe even prosper, by proactively focusing on becoming world-class ‘NetCo’s,’ standing behind and supporting thousands of ‘ServCo’ startups fighting for customers’ wallet-share across a wide range of financial transactions.

Strategic upheaval in the $1.6Tn Payments Market

Strategic upheaval in the $1.6Tn Payments Market

The payments market is changing more rapidly now than ever before. Both corporate and individual customers no longer tolerate paying large fees for what are essentially commodity services, transferring money securely.

The ‘Logic’ of Uber’s Uber-Round

The ‘Logic’ of Uber’s Uber-Round

A lot has been written about Uber’s latest financing round (mostly, about the reported of $50bn+ valuation), in the context of the current ‘herd’ of unicorns (apparently, 10 new horns sprouted in the last month).

Board Packs

Board Packs

Late stage growth companies often reveal far too much ‘dirty laundry’ in monthly packs prepared for their board meetings. In normal practice this is fine to stimulate debate and ensure transparency. But when that company is being sold in a high value M&A deal, these packs can give buyers cause to worry about things they might never have thought to ask.

Why we bet Acunu would be a High Value M&A Target

Why we bet Acunu would be a High Value M&A Target

One of the major themes we have pursued at Magister is big data infrastructure and analytics. Needless to say, despite the number of companies positioned as ‘big data’, actual leaders in the space are few and far between, all the more so in Europe.

Apple’s Watch: An ‘Over the Top’ Technology

Apple’s Watch: An ‘Over the Top’ Technology

Technology breakthroughs often focus on new operating systems, devices, or major semiconductor developments. But one of the most significant, yet under-reported, trends is for technology companies to ‘leapfrog’ each other with ‘over-the-top’ (OTT) technologies.

5 Mistakes in Tech M&A

5 Mistakes in Tech M&A

We’ve dealt with hundreds of tech buyers over 25 years. Apple and Oracle are head and shoulders above the rest, for the thorough, discreet, structured, and efficient way they execute a large number of deals each year.

World Number One Carrier Billing Company Created

World Number One Carrier Billing Company Created

We break our tradition of not publicizing our client work to congratulate the leadership of both Boku and mopay AG on today combining to create the world leader; Magister advised mopay on the transaction. We don’t often get to work on a deal which creates a real world market leader, reaching 5 billion mobile users in 80+ countries.

Perception minus reality equals value

Perception minus reality equals value

How can a fast-growth tech company get sold for $1 billion+ before their 100th employee, or even their first $ of profit?

Uncharted waters for the Adtech M&A Wave

Uncharted waters for the Adtech M&A Wave

RocketFuel’s announced acquisition of [x+1] is the first major combination of two significant, independent AdTech companies in the current M&A wave, combining a leading DSP and DMP to create a more holistic (and more SaaS-like) platform.

Adtech on an M&A Wave

Adtech on an M&A Wave

$2bn of AdTech M&A Since February, with Enterprise Buyers In the Middle of the Froth.

Dilution (really) doesn’t matter

Dilution (really) doesn’t matter

Most founders contemplating a large €20m+ investment round immediately calculate their percentage ownership ‘post-dilution’ (meaning what they owned immediately before the funding round, versus what they own the second after it closes).

Suarez to Barcelona: A deal structuring lesson

Suarez to Barcelona: A deal structuring lesson

Let’s imagine Liverpool’s sale of Luis Suarez for £75m to Barcelona as an M&A deal that needs careful structuring. Without knowing the real deal terms, here’s how we think it should have been structured.

No such thing as a “European” investment round anymore

No such thing as a “European” investment round anymore

US venture investors are not coming to Europe, they are already here, in VERY large numbers. They’re such a big factor in the European funding scene that the whole concept of “US VCs” and ”European VCs” is a thing of the past.

Big data – Yes, it is still a big deal

Big data – Yes, it is still a big deal

Big Data is going through Gartner’s “trough of disillusionment”. Endless articles espouse why big data is a fad, doesn’t matter or is failing.

Handling an inbound approach - 5 classic mistakes

Handling an inbound approach - 5 classic mistakes

Whether a deal is $50m or $1bn; the dynamics are the same. A surprise email from a prominent acquirer expressing strong interest in a “strategic deal that could benefit both parties.”.

5 things you should ask your M&A Advisor

5 things you should ask your M&A Advisor

If we were a prospective client, evaluating whether or not to hire a particular M&A advisory firm, here are 5 questions we would pose.

10m per employee exit

$10M+ Per Employee Exit?

At the height of the 2000 bubble, the scramble to buy promising early-stage businesses sent the price per employee through the stratosphere, to $10m+ at the peak. That meant a 20-person business, just getting market traction, could be valued at $200m. In hindsight, it was “insane”.