09.01.17 SFE Corporate Presentation -...
Transcript of 09.01.17 SFE Corporate Presentation -...
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CorporatePresenta5onSeptember 2017
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TheSafeguardAdvantages
§ StrongPor<oliooftech-enabledcompaniesacrossseveralver2calswithfullvaluemuchhigherthanreflectedincurrentshareprice
§ TalentedTeamwithdeepdomainexper2seandopera2ngexperience
§ Flexible,Mul5-StageCapitalDeploymentApproachthatisnotconstrainedbythetypicalLimitedPartnerfundstructure
§ ScalableOpera5ngModeltoaccommodatealargerporHolioofcompanies
§ ExtensiveNetworkwithaccesstoearly-andgrowth-stagetechnologyopportuni2esincludingEnterprises,Advisors,AcceleratorsandUniversi2es
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LeadershipTeam
StephenT.ZarrilliPresidentandCEO
JeffreyB.McGroartySVPandCFO
BrianJ.SiskoEVP,ManagingDirectorandCOO
Mar5naF.AufieroSVPandManagingDirector
GaryJ.Kurtzman,MDSVPandManagingDirector
ErikB.RasmussenSVPandManagingDirector
StevenJ.Grenfell,CPASVPandManagingDirector,Opera2ons
JohnE.ShaveIII,IRCSVP,InvestorRela2onsandCorporateCommunica2ons
ScoWA.Snyder,PhDSVP,ManagingDirectorandCTIO
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CapitalDeploymentObjec5ves
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TargetMarkets
§ eCommercewillbe$523BinU.S.and$4Tworldwideby2020[Source:eMarketer]
§ Web-influencedretailsaleswillbe$1.6Tby2020[Source:EY]
§ Digitaladspendwillbe$333Bby2020[Source:eMarketer]
§ Personaliza2oneconomywillbe$97Bby2020[Source:Accenture]
§ FinTechtocapture10%to40%ofbankingrevenueby2025[Source:McKinsey]
§ $12BinvestedgloballyinFinTech,approx.50%ofthatinU.S.[Source:CBInsights]
§ CorporateVentureArmsofFinancialServiceCompaniescon2nuetobestronginvestors
§ $3TU.S.market(18%ofGDP),approx.1/3tobewaste[Source:CMS]
§ HealthcareITmarkettosurpass$230Bby2023[Source:GlobalMarketInsights]
§ Chronicdiseaseswillaffect164MAmericans(49%)ofpopula2onby2025[Source:RANDCorporaCon]
HEALTHCARE DIGITALMEDIA
FINANCIALSERVICES
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MarketOpportunityinEmergingTechnologies
§ IoTwillhavepoten2aleconomicimpactof$3.9Tto$11.1Tby2025[Source:McKinsey]
§ IoTdeviceswillreach+46Bin2021[Source:Juniper]
§ B2BspendingonIoTtechnologieswillreach$267Bby2020[Source:BostonConsulCngGroup]
§ BigData/Analy2csmarketwillbe$203Bby2020(11.7%CAGR)[Source:IDC]
§ AI-basedsystemsmarketwillgrowfrom$8Bin2016to$47Bin2020[Source:IDC]
§ Allmajortechgiantsareinves2ngheavily(i.e.Google,IBM,Microsog,Amazon,Facebook,Apple,Baidu)
§ Cyber-securitymarketwillgrowfrom$105Bin2015to$182Bin2021(9.5%CAGR)[Source:ZionMarketResearch]
§ Globalcyber-securityspendingwillexceed$1Tfrom2017to2021[Source:CybersecurityVentures]
§ BlockchainforEnterpriseApplica2onsMarkettoreach$19.9Bby2025[Source:TracCca]
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PartnerCompanies:Overview
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PartnerCompanies:ByRevenueStage
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AggregatePartnerCompanyRevenue
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PartnerCompany:TriceMedical
Ini5alCapitalDeployed July2014
TotalCapitalDeployed $10.2M
SFEPrimaryOwnership 25%
Headquarters KingofPrussia,PA
RevenueStage Ini5alRevenue
ElevatorPitch Pioneeredandevolvedafullyintegratedcamera-enabledtechnologythatprovidesaclinicalsolu2onop2mizedforthephysician’soffice.
Partnerships/Customers OpenClinicaEnterprise,TikaMobile
MarketOpportunity
Addressablemarketopportunityisapproximately$10B,including32Mofficevisitsforrelatedkneeandshoulderpainand8M+MRIsannuallyintheU.S.alone.
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PartnerCompany:Transac5s
Ini5alCapitalDeployed August2014
TotalCapitalDeployed $14.5M
SFEPrimaryOwnership 24%
Headquarters NewYork,NY
RevenueStage Expansion
ElevatorPitch Leadingproviderofelectronicbillingandpaymentsolu2ons.
Partnerships/Customers
CapitalOneFinancialCorpora2on(NYSE:COF),FighThirdBancorp(NASDAQ:FITB),PNCFinancialServicesGroup(NYSE:PNC),TDBankGroup,Walletron,WellsFargo&Company(NYSE:WFC).
MarketOpportunity
Fewerthan25%ofbillsarepresentedelectronicallyintheU.S.Thechannel-orientedTransac2smodelfeaturesup-to-dateSaaSinfrastructureandisposi2onedtogrowwithanEBPPmarketthatisexpandingatacompoundannualrateof16%,accordingtoa2013reportbymarke2ngconsultantLatenteGroup.
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PartnerCompany:MediaMath
Ini5alCapitalDeployed July2009
TotalCapitalDeployed $25.5M
SFEPrimaryOwnership 21%
Headquarters NewYork,NY
RevenueStage HighTrac5on
ElevatorPitchGlobaltechnologycompanythatisleadingthemovementtorevolu2onizetradi2onalmarke2nganddrivetransforma2veresultsformarketers.
Partnerships/Customers Facebook,IBM,iSocket,Microsog,Oracle,TimeInc.andYahoo!
MarketOpportunity
DigitaladspendingisexpectedtogrowataCAGRof14%between2015and2018accordingtoeMarketer.
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PartnerCompanyHoldingsat6/30/17
Stage Category Acquisition Year
Primary Ownership%
Carrying Value Cost
Partner Companies: (in millions) (in millions)AdvantEdge Healthcare Solutions High Traction Healthcare 2006 40% $5.0 $16.3Aktana Initial Revenue Healthcare 2016 25% 5.6 9.7Apprenda Expansion Other 2013 29% 9.4 22.1Brickwork Initial Revenue Digital Media 2016 20% 3.8 4.2Cask Data Initial Revenue Other 2015 31% 7.1 11.6CloudMine Initial Revenue Healthcare 2015 47% 4.3 7.5Clutch Holdings Expansion Digital Media 2013 43% 9.6 16.3Full Measure Education Initial Revenue Digital Media 2015 42% 7.2 11.0Good Start Genetics High Traction Healthcare 2010 30% - 19.0Hoopla Software Initial Revenue Digital Media 2011 26% - 4.8InfoBionic Initial Revenue Healthcare 2014 40% 2.6 18.5Lumesis Initial Revenue Financial Services 2012 44% 1.9 6.3MediaMath High Traction Digital Media 2009 21% 4.3 25.5meQuilibrium Initial Revenue Healthcare 2015 32% 4.1 8.0Moxe Health Initial Revenue Healthcare 2016 32% 4.3 4.5NovaSom High Traction Healthcare 2011 32% 1.8 23.1Pneuron Initial Revenue Financial Services 2013 35% - 8.5Prognos (fka Medivo) Expansion Healthcare 2011 35% 4.9 11.6Propeller Health Initial Revenue Healthcare 2014 24% 7.9 14.0QuanticMind Initial Revenue Digital Media 2015 23% 6.7 9.8Sonobi Expansion Digital Media 2015 22% 6.2 8.4Spongecell Expansion Digital Media 2012 23% 7.8 18.0Syapse Initial Revenue Healthcare 2014 26% 4.4 13.3T-REX Initial Revenue Financial Services 2016 24% 5.6 6.0Transactis Expansion Financial Services 2014 24% 10.1 14.5Trice Medical Initial Revenue Healthcare 2014 25% 5.1 10.2WebLinc Expansion Digital Media 2014 38% 8.8 14.0Zipnosis Initial Revenue Healthcare 2015 25% 4.8 7.0Total TOTAL: $143.3 $343.7
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SuccessStories
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NOLsandCapitalLossCarryforwards
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EquityIncen5veCompensa5on
§ KeyAqributes• Structuredtoalignwithshareholderinterest
• Consistentwithcarriedinterestmethodology
• Two-thirdsofves5ngbasedonperformancecriteria
§ PerformanceVes2ng• Uponachievementofcash-on-cashreturnthresholds(2.0x-3.0x)
onpoolsofcapitaldeployed
§ InsiderOwnership• Ownershiprequirementsof2x-4xbasesalaryforseniormanagement
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WhyOwnSafeguard(NYSE:SFE)?
§ Accesstoearly-andgrowth-stagetechnologycompanies
§ SFEcurrentlytradesatsignificantdiscounttonetassetvalue
§ Fullvalueofpartnercompaniesnotreflectedinshareprice
§ Teamhasdeepdomainexper2seandopera2ngexperience
§ Strongalignmentofinterestswithshareholders
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JohnE.ShaveIIISENIORVICEPRESIDENT,INVESTORRELATIONS&CORPORATECOMMUNICATIONS
[email protected]:www.safeguard.com/RequestAMee2ng
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Statementscontainedinthispresenta2onthatarenothistoricalfactsareforward-lookingstatementswhichinvolvecertainrisksanduncertain2esincluding,butnotlimitedto,risksassociatedwithourabilitytomakegooddecisionsaboutthedeploymentofcapital,thefactthatourpartnercompaniesmayvaryfromperiodtoperiod,oursubstan2alcapitalrequirementsandabsenceofliquidityfromourpartnercompanyholdings,fluctua2onsinthemarketpricesofourpubliclytradedpartnercompanyholdings,compe22on,ourinabilitytoobtainmaximumvalueforourpartnercompanyholdings,ourabilitytoaqractandretainqualifiedemployees,marketvalua2onsinsectorsinwhichourpartnercompaniesoperatemaydecline,ourinabilitytocontrolourpartnercompanies,ourneedtomanageourassetstoavoidregistra2onundertheInvestmentCompanyActof1940,andrisksassociatedwithourpartnercompanies,includingthefactthatmostofourpartnercompanieshavealimitedhistoryandahistoryofopera2nglosses,faceintensecompe22onandmayneverbeprofitable,theeffectofeconomiccondi2onsinthebusinesssectorsinwhichourpartnercompaniesoperate,andotheruncertain2esasdescribedinourfilingswiththeSecuri2esandExchangeCommission,includingourAnnualReportonForm10-K.Asaresultoftheseandotherfactors,theCompany’spastfinancialperformanceshouldnotbereliedonasanindica2onoffutureperformance.
Safeguarddoesnotassumeanyobliga2ontoupdateanyforward-lookingstatementsorotherinforma2oncontainedinthispresenta2on.
AlldatacurrentasofJune30,2017.
Forward-LookingStatements