French-Canadian Pierre Nadeau joined early stage enabling communications technology investor nCoTec in the spring to spearhead its investment efforts in France, specifically in the Sophia Antipolis region in the south of the country. He is based in London. Nadeau is crossing from the corporate into the venture capital world and brings with him some 20 years of experience and contacts in nCoTec’s chosen field of investment. nCoTec was set up last year by three ex-Salomon Smith Barney investment bankers Alisdair Warren, Lars Lindell and Tim Horlick and is close to completing the fund raising for its first fund, which has a target of E150 million.
What attracted you to nCoTec?
I found the idea of joining an early-stage start-up VC fund, focused exclusively on European enabling communications technology, most attractive. As you know in a start-up you get the chance to influence the shape of the business and the opportunity to do a bit of everything i.e. market research, fund raising, deal flow development, investing, due diligence, recruiting, business development, etc this is what I like about nCoTec. I must also add that the unique mix of industry experience (for each of the four communication technology sectors covered by nCoTec) and financial and VC experience on the team is a major competitive advantage for this team.
Venture capital is a career change for you. What past experience will you draw on most and do you think this is a good time to become a technology investor?
I have spent 20 years in the communication infrastructure and component business with Nortel, Lucent, LSI Logic and Mitel on both sides of the pond. I like to think that my experience in funding and managing people as well as product development, marketing and sales activities over the years can add value to the investment and venture management process. It is indeed a very good time to become a technology investor as valuations are very attractive, and moreover, a first time VC fund like nCoTec has no legacy investments to worry about. I must admit, however, that fund raising activities in the current market environment do demand a great deal of focus, persistence and salesmanship.
Much of your time will be spent in Sophia Antipolis. What sort of investment opportunities do you expect to emerge from that region in the coming months?
Let me first share my views as to why I believe that Sophia Antipolis is a good place to invest. Sophia Antipolis has one of the largest concentration of engineers and technicians in Europe – close to 22,000 at the last count. Fifty per cent of them work in the fields of information and communication technologies. The region benefits from a number of very good engineering and business schools and research institutes i.e. ESINSA, ENSMP, EURECOM, INRIA, CNRS, CERAM and THESEUS just to name a few. Infrastructure and services are excellent and the region is blessed with Mediterranean weather, which means that it is easier to relocate top managers and technical experts there than it is in many other locations I can think of. This is something that leading communications companies have long recognised by establishing a strong presence in the region e.g. IBM, TI, Philips (alias VLSI), Nortel, Infineon, Conexant, Ericsson, etc. Moreover, the region is not crowded with too many VCs chasing a few deals. nCoTec intends to establish a presence in Sophia to exploit early-stage investment opportunities in enabling communication technology: components, infrastructure, communication software and applications-enabling technology. We currently have good visibility on a number of interesting opportunities in the components area, so this is where I expect early-stage investment activities to emerge in the coming months.
How do you anticipate nCoTec’s interaction with French domestic venture capital firms to evolve?
There is little doubt in my mind that in order to be successful in France and in Sophia, in particular, solid relationships with French VC firms need be established. I suspect that potential investee companies based in France will naturally welcome the idea of a domestic VC co-investing in their firm. We are in the process of establishing those relationships with French VC firms that have an investment focus similar to that of nCoTec.
How does your remit in France fit into nCoTec’s overall investment strategy and vision?
My responsibilities at nCoTec do include the opening of an office in Sophia Antipolis, the development and management of a quality deal flow and relationships in France, the ongoing support of all investee companies based in France and overall responsibility for the enabling component sector across Europe. My responsibilities are, in many ways, similar to those of my colleague Jacob Phillipson who is running the nCoTec office in Stockholm. Jacob is responsible for the development and management of a quality deal flow and relationships in Scandinavia, the ongoing support of all investee companies based in Scandinavia and overall responsibility for the communication software sector across Europe. In essence each regional partner has two main roles: to manage all investment activities in the region and to manage all investment activities in one specific communication sector across Europe.
Do you think the time will come when you move lock stock and barrel to Sophia Antipolis?
The completion of a first deal in Sophia Antipolis will be a key milestone and will naturally trigger the decision to establish a permanent nCoTec presence in the region. I do anticipate that this may happen by the end of this year at the earliest.
What’s next for nCoTec?
The next milestone for nCoTec will be Munich. We expect to open the Munich office shortly after the final closing of the fund i.e. early in 2002.