Pitch Best Small Cap 2019: HPE Growth – WeTransfer

De genomineerde deals maken dit jaar kans op de M&A Award voor Best Small Cap Deal 2019. Deze pitch is ingezonden door Jonne de Leeuw van HPE Growth

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Date deal closed
2 August 2019

Published value
EUR 50 – 250 million

HPE GrowthHighland Europe


WeTransfer founder and early employees

Involved firms and advisors sell side
Axeco – Corporate FinanceCorporatewise – Legal

Involved firms and advisors target
Arma Partners – Corporate FinanceStek – LegalCorptech – Legal

Involved firms and advisors buy side
PwC – Financial and Tax DDThe Modular Company – Technology DDVriman – Legal DDLoyens & Loeff – Legal DD on behalf of Highland Europe

Brief description deal / Deal outline
In August 2019, HPE Growth led a EUR 35 million secondary investment in WeTransfer in collaboration with existing investors of which Highland Europe. The transaction entailed the acquisition of shares from 6 individual shareholders (WeTransfer founder and early employees) as part of a highly competitive bidding process in which some of Europe’s most reputable growth investment firms were involved. The number of shareholders as well as the nature of a minority buy out with support of part of the existing shareholder base as well as new investors such as HPE Growth, resulted in a commercially and legally complex deal.

Deal rationale
Since its inception in 2009, WeTransfer has been able to position itself as the go-to file sharing service for the creative community. In addition to its original file sharing product, the company has invested heavily in its product portfolio to become a fully-integrated collaboration suite covering the entire creativity lifecycle, including tools such as a content sharing app, a sketching app and a collaborative presentation tool for teams. WeTransfer has reached global scale, serving 50 million monthly users across 195 countries with over 1.5 billion files transferred per month. HPE believes that the move towards an integrated product strategy will enable WeTransfer to strongly benefit from ongoing trends such as ever-increasing file sizes, growth in media content creation and an increase in freelance users.Growing profitably and therefore without an immediate cash need, the secondary transaction represents an unparalleled opportunity for HPE Growth to back the leading collaboration suite for creative professionals and participate in the company’s future growth as the company further transitions from a single-product to an integrated multi-product strategy.

What is the impact of this deal for the company?
On behalf of HPE Growth, Jonne de Leeuw will join the supervisory board, joining Bas Beerens (co-founder), Irena Goldberg (Highland Europe) and Tony Zappalà (Highland Europe). In addition to further shaping the company’s supervisory board, HPE will add value through its significant capital markets expertise while positioning WeTransfer for its IPO.

What is the impact of this deal for the direct stakeholders?
HPE Growth will support WeTransfer on its quest to offer “beautifully obvious tools” to its customer base as the company further diversifies its product offering, supplying HPE Growth’s longstanding experience in investing in and further building leading technology companies as well as supporting the company through HPE Growth’s significant follow-on financing capability that can be drawn from while further building out the WeTransfer platform. The changes to the company’s value proposition that are envisaged to be implemented over the next months will have a strong impact on the value derived by WeTransfer’s customer base and will further position the company for global market leadership in the file sharing and creative collaboration markets.

What is the impact of this deal on the society?
30% of the advertisements on WeTransfer are directed to the creative community for free whereby upcoming artists can show their unique perspective on the world.In addition, WeTransfer has a positive impact on society as it enables people to share their creative ideas in a beautiful way as WeTransfer has an exceptionally high net promotor score.Moreover, the deal is unique as it shows there is actually a market for founders and early employees to sell their stakes and monetize value created through building sizable technology companies while the respective companies remain independent and can further scale creating larger technology companies in Europe.

Why does this deal deserve a nomination?
WeTransfer is a truly global, fast growing and profitable technology leader, founded and still headquarter in the Netherlands – now supported by HPE Growth, an investor with Dutch roots, that will help prepare the company for its next wave of growth.

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