This presentation was prepared by EIF. Any estimates and projections contained herein involve significant elements of subjective judgment and analysis, which may or may not be correct.

European Investment

Fund

EIF support of Tech Transfer and Intellectual Property

And how we want to do more

Graham Cope

European Investment Fund

Ve

ntu

re &

Gro

wth

Ca

pita

l Po

rtfolio

€5.4bn Net Equity Commitmentsacross Europe at 31.12.2010

Austria 54

Belgium 82

Bulgaria 13

Cyprus 7

Czech Republic 28

Denmark 95

Estonia 7

Finland 115

France 768

Germany 558

Greece 15

Hungary 16

Ireland 89

Italy 267

Latvia 36

EU 27

EFTA/EEA

EU Candidate Countries

Lithuania 40

Luxembourg 21

Malta 8

Netherlands 109

Norway 25

Poland 92

Portugal 155

Romania 36

Slovakia 4

Spain 423

Sweden 280

Switzerland 81

Turkey 274

United Kingdom 1306

Other & Non EU 396

EUR m

Nordic

Region

(total):

EUR 515m

1

2

Technology Transfer - Converting Research

into Products for the Market

MarketUniversity /

Research

Organisation

Spin-out

Licensing

Collaboration

(contract research,…)

IP / Idea

“technology IP” “prototype IP”

R&D Technology Transfer Marketable Product

Technology Transfer is the process which uses these 3

channels to convert scientific findings from research

organisations into commercial products

3

Since 2005, EIF has been able to invest more and

more resources to understand Tech Transfer, to create

awareness and to develop new TT initiatives with

leading research universities

Focus is on research organisations which are leaders in

their respective fields and act in an entrepreneurial

environment

Accelerated process through framework agreements

(covering issues such as company valuations,

shareholder structure,…)

Several transactions already, in which EIF played a key

role

Eager to do more…

ElF's Tech Transfer Experience

4

IP venture fund UK

• GBP 31m fund

• Signed September 2006

• Fund invests 25% of all

financing rounds of IP group

spinouts, originating from more

than 10 UK universities

UMIP Premier Fund

• GBP 32m fund

• Signed April 2008

• Fund, managed by MTI, invests

in university spin-outs

originating from the University of

Manchester

Chalmers Innovation

• SEK 170 m

• Signed July 2008

• Investing in start-up companies

originating from Chalmers

University and incubated by the

Chalmers Innovation incubator

in Gothenburg

Leuven CD3 (Centre for

Drug Design and Discovery)

• EUR 24m fund

• Signed Mid 2006

• Financing early stage drug

development projects

originating from Leuven and

elsewhere in EU

EIF Tech Transfer Transactions

Imprimatur (JEREMIE: development

objective)

ongoing transaction

• EUR 20,4m

• Expected Signature 2010

• Seed & Start-Ups / Tech Transfer

in Latvia

• Fund to be managed by the

local Imprimatur team in Riga

Karolinska Development

• EUR 26.7 m

• Signed Nov 2009

• Co-investment fund, investing

alongside Karolinksa

Development in life science

spin-outs throughout

Scandinavia

5

■ 10 year Limited Partnership.

■ Managed by VC firm: MTI partners

■ GBP 32 m raised. 18 months between

first pitch to EIF and first closing in

4/2008

Manchester the Largest UK University

Research Budget

Manchester University / UMIP Premier Fund

6

IP Group: Bringing together 10 Universities

- 74 Spin-outs in 3 years

■ Co-investment fund (seed,

post-seed financing

■ Critical mass reached

through a network of

universities

■ Liquidity vs listing

Deal flow and

critical mass

IP Venture Fund UK

7

Case Study: Chalmers InnovationStarting point: a proven tech transfer and incubation process, creating approx. 10 start-ups per year

Process steps

Pre-Incubation Incubation “Alumni”

companies

Entrepreneurial mind

Large potential

Unique idea

Control of IPR

Technology based

Formed company

Validated business

CEO

Business plan

Financial plan

Repetitive business

Developed organisation

Board of directors

Secured longer term

finance

Milestone

/ Deliverable

~6m 24-36m

Start-up

projects

8

Case Study: Chalmers InnovationThe fund, managed by an enlarged incubator team, invests in all stepsof the process

Co-investorsEIF

Pre-Incubation Incubation Alumni companies

“Fund”

•Investments at commercial terms

•Investments in existing TTO start-ups

and new start-ups (both university IP

based spin-outs as well as start-ups

attracted and grown by the

incubator)

Indicative

amounts

EUR ~50k EUR 200-500k EUR 1-3m

“Pre-seed funding” “Seed funding” “Post-seed funding”

Seed Investors

Federal funds

Regional funds

Other public/private funds

BAs, VCs, …

Tech Transfer process

Management team

•Incubator professionals

(industrial background)

•Investment professionals

•Maximum autonomy

9

Size and quality of deal flow

The university generates an important flow of

innovations

The region is a well functioning entrepreneurial

ecosystem

The TTO delivers

Breadth and depth of team

Track-record in developing start-ups

Invests before and at company creation

Potential to have a significant impact

Develop start-ups better and faster

Capture a larger share of the value created

Case Study: Chalmers Innovation

Investment case for EIF

10

Lessons Learnt 5 Years on

Clear funding gap persists

Tech Transfer is different to VC and has its own set of rules

Not just spin-outs in the story but also licensing

Long-term partnerships with research centres: build trust,

no individual entry valuations, ex ante agreements, no

dilution -- Privileged access to deal flow and “Bears’ hug”

Increasing interest from private co-investors but still room

for improvement

Longer time-horizon for business development and lead-

time

Growing policy-maker focus

11

Knowledge Transfer Strategic Partnership

First initiative to address challenges and widen the reach and scope

Signed in Rome - 16 June 2010

Creation of joint Working Group between EIF/EIB, CDC (France),

(CDP – Italy), (CDTI - Spain), Innovationsbron (Sweden), KfW-

Bankengruppe (Germany) & Veraventures (Finland)

Aim of like-minded Partners is to:

Support the emergence of European and national Knowledge

Transfer Infrastructures

Accelerate transfer of European research and technology to the

market

Facilitate a well functioning Knowledge Transfer and Intellectual

Property economy

Encourage more open and transparent marketplaces for

Intellectual Property

Exchange best practices and potentially to analyse investment

opportunities jointly

Partners

12

ERP (launched in 2004) Co-investment 50/50: EIF/ERP (administered by German Ministry BMWi) Size: € 1bn - € 642m committed in 20 funds

NEOTEC: Spanish Technology Fund-of-Funds (launched in 2006)Tech fund in partnership with CDTI (TMT, ICT, cleantech, biotech and LS) Size: € 183m - € 117m in 11 Funds and Co-investment Agreements

Istanbul Venture Capital Initiative (launched in 2007)Turkish generalist VC investment vehicle for institutional investors Size: € 160m - 2 funds signed for a total of € 21m

Portuguese Venture Capital Initiative (launched in 2008)Generalists funds, ICT, Life Sciences, Healthcare, Environmental & Energy Technology Size: € 111m – 2 transactions signed for a total of € 30m

UKFTF: UK technology Fund-of-Funds (launched in 2010)Launched by the UK government and advised by EIF Size: £200m at first closing to be invested in Funds targeting UK

start-ups and growth businesses in the high tech sector –3 investments signed for £28m

Public Private Leveraging of EIF Capacity and Experience

The Growing Importance of Fund-of-Funds management (selected examples)

Copyright ERP

13

How do we see the Nordic market?

Many strengths Worrying weaknesses

High Quality University & Research Institutions

Mature Market with experienced investment professionals

Track records and Success stories

High cross-border collaborations levels

Strong entrepreneurial environment

Many investment opportunities

Difficult market conditions

to attract private investors

Withdrawal of certain

fund managers

Withdrawal of certain

Pension Funds

Global competition for

investment flows

Talent loss

Missed opportunities

14

Contacts

European Investment Fund

96 boulevard Konrad Adenauer

L-2968 Luxembourg

Tel.: (+352) 42 66 881

Fax: (+352) 42 66 88 200

www.eif.org

Jacques Darcy, Head of Technology Transfer & Intellectual

Property – j.darcy@eif.org

Graham Cope, Head of Region, Northern Europe Business

Development – g.cope@eif.org