Funding Environment in Utah

Funding Environment

When comparing sheer numbers of investment dollars, Utah is overshadowed by larger areas such as California and Massachusetts; however, measuring on a per capita level tells a different story. Utah’s startup friendly business environment helped the state grow to the 9th ranked state in the nation for venture investments in seed and early stage companies on a per capita basis. Utah also ranked number 1 in the nation in 2008 for independent inventor patents per 1,000 residents*

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Deal Flow 2007 MWCN Deal Flow Book MWCN Utah Fund of Funds Wayne Brown Institute

Utah’s funding environment experienced a substantial surge in deal making in 2007 in comparison to 2006. During 2007 there were nine public offerings, one of which was an IPO valued at $2.211,000,000; venture capital and private equity transactions increased both in terms of the number of transactions and the aggregate dollar amounts raised. M&A activity also increased significantly. The total value of all categories of reported transactions exceeds $8,273,000,000.**

2007 Deal Flow Summary

VC/Private Equity

According to the MountainWest Capital Network 2007 Deal Flow Report, there was a steep increase in venture capital and private equity investing in Utah during 2007 with transactions of about $565,000,000. A significant portion of the funding in this category was the $250 million financing of 212 Resources during 2007. Without this transaction, the venture capital and private equity investing in Utah during 2007 would have been comparable to the levels in 2006.

Notable technology investments included a $40.1 million round for Move Networks and a $40 million round for Interbank FX.

Mergers & Acquisitions

The value of the merger and acquisition activity increased significantly in 2007 as compared to 2006. In 2007 there were a total of 53 M&A transactions with disclosed amounts reaching a total valuation of approximately $4.5 billion; a significant increase over the 34 transactions valued at approximately $2.3 billion in 2006. In addition to the 53 deals there were 49 additional deals that did not disclose a transaction value. While as in past years, many of this year’s transactions involved the sale of Utah-based companies to out-of-state buyers, there were also a significant number of large transactions involving the acquisition of out-of-state companies by Utah-based companies, including a $1.2 billion dollar acquisition by Zions Bancorporation, Inc. There were also several large, successful exits by venture capital backed companies like the $300 million sale of the Generations Network.**

Public Offerings

The nine transactions in 2007 totaled approximately $3,212,718,000 which is a substantial increase from 2006 and indicates the volatility in a state like Utah which typically has only a few transactions each year. 2007 is highlighted by the $2.2 billion initial public offering by Boart Longyear and the $753 million initial public offering by Energy Solutions.**