The dynamics of company initial public offerings or resales is an indicator of the vitality of an innovation ecosystem. This is a central parameter for attracting financing, as these financial transactions are an absolutely necessary condition for investors to be able to recover their contributions.

If business angels and venture capitalists are interested in innovation, it is mainly for the potential returns of this asset class. This question is closely linked to the exit possibilities during a sale so that these investors can find their funds.

First encouraging signs

Historically, the exits from the canton's companies have been more of an isolated event. It was not uncommon, in some years, to see no sales or IPOs.

However, over the past five years or so, the momentum in the region has accelerated significantly. The canton is thus approaching a rate of 10 annual outings.

A regular start-up buyout rate is being set up in the canton


There is, of course, no indication that the conditions obtained were good. Despite this, considering that the number of new start-ups in the canton - projects financed by external investments - is around 40 per year, this exit rate of 1 for 4 projects financed is not so bad. However, the system is not in balance: the number of outputs will certainly increase further.

«The canton is thus approaching a rate of 10 annual outings»

Investors bring the buyers

This is obviously very good news, because it gives concrete expression to the quality of the dossiers and sends a clear signal to both investors and buyers. As for investors, the canton's projects are already attracting investors from all over the world. And this is partly logical, because the buyer usually comes from the networks brought in by the investor.

Eight out of 10 Vaud start-ups are taken over by a foreign company

This opening offers opportunities to entrepreneurs in the canton, but it also raises the question of the sustainability of jobs when a company is taken over by a foreign player.

A positive overall impact on employment

The issue of jobs is fundamental enough to determine whether or not to support the investment activity of foreign actors. To answer this question, the "Vaud Innove" project team analyzed data on start-up takeovers over the last 10 years in the companies in the portfolio of the Foundation for Technological Innovation, as well as the impact of these takeovers on jobs in the region (seen at the end of 2018).

Overall, the return to work has a positive impact on employment in the canton


The limited sample includes 11 situations over 10 years on a portfolio of approximately 150 active files. It is therefore difficult to draw definitive conclusions. However, these data tend to reinforce the project team's perceptions. Starting with the fact that the overall impact on employment is positive.

«The issue of jobs is fundamental enough to determine whether or not to support the investment activity of foreign actors»

Deeptech companies remain

The other observation, which tends to be confirmed by these data, is that projects that are dissolved or moved after a recovery have recurring characteristics. The first case study results from the buyer's desire to acquire a patent, with no real interest in developing the start-up's technology or project. This is often the case for a project in the life sciences, which employs just over five people.

Private companies seem to have a different profile

The second typical case is that of the resumption of a software project. In this case, it is often the talent pool or recruitment networks of the buyer that leads to the relocation of the project or teams.

In the end, the projects that are most resilient and create the most jobs at this stage are those that both exploit advanced technology with patents or specific know-how and are already advanced in commercialization when the recovery takes place.

Still waiting for the first IPOs

However, most of the outings in the region consist of reselling to another company, which always presents the risk of a shutdown either of the project or of the founders' strategic vision.

OTC sales are the most common exit route for investments in start-ups in the canotn

Over the past 10 years, very few start-ups in the canton have gone public. Only AC Immune took the plunge in 2016, excluding the recent IPO of Bicycle Therapeutics, an essentially English project despite its links with EPFL. However, this may soon change with the new generation of projects and entrepreneurs emerging. Examples include companies such as Nexthink (cybersecurity), Sophia Genetics (medical informatics) or Beqom (human resources software), which are emerging as candidates for future listing. We will obviously add ADC Therapeutics, based at the Biopôle in Epalinges, which has just filed a file with the New York Stock Exchange under the "ADCT" ticker.

«Over the past 10 years, very few start-ups in the canton have gone public»