Candy Crush Saga backer plays down tech bubble fears

One of the private backers behind Just Eat and the video games developer King has defended their disappointing stock market listings, denying that investors were "hoodwinked" into buying at inflated valuations.

Shares in the online takeaway portal Just Eat and the Candy Crush Saga games developer King fell below their listing prices earlier this year, and both are still trading below their IPO pricing.

The London-based venture capital firm Index Ventures was an early investor in both companies and sold shares into both public offerings.

Ben Holmes, a partner at Index, said: "With all these businesses that have gone public, there's no way in which we feel that we've hoodwinked investors and got them to buy into something at a crazy price. They're all great businesses.

"The share prices have gone down but the businesses have done quite well. I think it's important to decouple that. They are very difficult businesses to value – they're both growing incredibly fast in potentially massive markets. Historically many of the great companies did not have a big first-day pop – Facebook and Google being good examples. We're not overly concerned."

Other digital businesses such as the online whitegoods retailer AO World have also struggled on the public market, and the German investment bank Berenberg last week expressed concerns that a tech "bubble" could be emerging, similar to the one that crashed stock markets at the turn of the millennium.

Mr Holmes dismissed such fears, saying: "I think there's a very different complexion to businesses going public now compared to the type of businesses going public 15 years ago, where the market seemed to lap up anything with an internet flavour. The market is still very discerning, particularly in Europe."

Mr Holmes' comments come as Index Ventures launches its seventh fund to invest in early-stage technology businesses. Index will focus investment from the $550m (£330m) fund on key "hubs" around the world – London, San Francisco, Berlin, New York, Stockholm and the Nordics, Tel Aviv and Paris.

Index's past investments include Skype, Dropbox, LoveFilm and Asos.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Content Writer - Global Financial Services

£25000 - £30000 per annum: Recruitment Genius: From modest beginnings the comp...

Recruitment Genius: Web Developer - PHP

£35000 - £40000 per annum: Recruitment Genius: From modest beginnings the comp...

Recruitment Genius: Field Sales Consultant - Financial Services - OTE £65,000

£15000 - £65000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: Loan Underwriter

£18000 - £20000 per annum: Recruitment Genius: This is a fantastic opportunity...

Day In a Page

A nap a day could save your life - and here's why

A nap a day could save your life

A midday nap is 'associated with reduced blood pressure'
If men are so obsessed by sex, why do they clam up when confronted with the grisly realities?

If men are so obsessed by sex...

...why do they clam up when confronted with the grisly realities?
The comedy titans of Avalon on their attempt to save BBC3

Jon Thoday and Richard Allen-Turner

The comedy titans of Avalon on their attempt to save BBC3
The bathing machine is back... but with a difference

Rolling in the deep

The bathing machine is back but with a difference
Part-privatised tests, new age limits, driverless cars: Tories plot motoring revolution

Conservatives plot a motoring revolution

Draft report reveals biggest reform to regulations since driving test introduced in 1935
The Silk Roads that trace civilisation: Long before the West rose to power, Asian pathways were connecting peoples and places

The Silk Roads that trace civilisation

Long before the West rose to power, Asian pathways were connecting peoples and places
House of Lords: Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled

The honours that shame Britain

Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled
When it comes to street harassment, we need to talk about race

'When it comes to street harassment, we need to talk about race'

Why are black men living the stereotypes and why are we letting them get away with it?
International Tap Festival: Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic

International Tap Festival comes to the UK

Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic
War with Isis: Is Turkey's buffer zone in Syria a matter of self-defence – or just anti-Kurd?

Turkey's buffer zone in Syria: self-defence – or just anti-Kurd?

Ankara accused of exacerbating racial division by allowing Turkmen minority to cross the border
Doris Lessing: Acclaimed novelist was kept under MI5 observation for 18 years, newly released papers show

'A subversive brothel keeper and Communist'

Acclaimed novelist Doris Lessing was kept under MI5 observation for 18 years, newly released papers show
Big Blue Live: BBC's Springwatch offshoot swaps back gardens for California's Monterey Bay

BBC heads to the Californian coast

The Big Blue Live crew is preparing for the first of three episodes on Sunday night, filming from boats, planes and an aquarium studio
Austin Bidwell: The Victorian fraudster who shook the Bank of England with the most daring forgery the world had known

Victorian fraudster who shook the Bank of England

Conman Austin Bidwell. was a heartless cad who carried out the most daring forgery the world had known
Car hacking scandal: Security designed to stop thieves hot-wiring almost every modern motor has been cracked

Car hacking scandal

Security designed to stop thieves hot-wiring almost every modern motor has been cracked
10 best placemats

Take your seat: 10 best placemats

Protect your table and dine in style with a bold new accessory