Data about multiples and valuations of Swiss deeptech companies

The recently published study about the impact of ETH Zurich spin-offs deserves a closer look. It includes data on valuations and multiples which are not easy to find elsewhere.

Two weeks ago, ETH Zurich published its study about the performance of ETH Zurich spinoffs. Besides information to the number of created jobs and revenues the study also enlightens the readers about the valuations of these deep tech companies and the investment multiples. Both key figures are important for start-ups looking for money as well as for investors. The study thus provides important reference points for both groups.

In the study an equity value was calculated for 148 spin-offs, 65 of which included a BA or VC round. The total equity value is driven by a few large companies, i.e. the spin-off with the highest valuation accounts for 15.0 per cent of the total value, the top three for 37.9 per cent and the top ten for 74.1 per cent. Despite an average equity value per spin-off of CHF 32.4 million, the median is therefore CHF 2.6 million.

In total the 148 spin-offs in the sample achieved an equity value of CHF4.8 billion. CHF 3.7 billion is being realised  through exits (two IPOs, two reverse mergers and 20 trade sales), while the remaining CHF 1.1 billion reflects a current value that has not yet been realised (e.g. equity was valued using current financing events or multiples).

Higher valuation for companies with investment

The average exit valued the equity of the spin-offs at CHF 153 million (median of CHF 37.5 million), while the average company that did not experience an exit was valued at CHF 9.1 million (median of CHF 966’000). The average spin-off in which the authors found evidence of BA or VC support resulted in an equity value of CHF 56.5 million compared with CHF 13.5 million for non-BA/VC companies.

Exit multiple of 5.7x on average

Nine companies in the sample realised an exit. If only these companies are taken into account, the money multiple – in this case an exit multiple – is 5.7x. This result is similar to the result of analyses by Thomas Heimann which we published in the last Swiss Venture Capital Report. According this analysis the average multiple of venture backed Swiss start-ups which realised an exit between 2005 and 2019 is 6.6x with a median of 5.6x.

The study about the perfomance of ETH Zurich spin-offs can be downloaded for free from the ETH Zurich website