Key Trends in European Investment and Funding

Europe is back - 37% of October’s venture capital came from the continent, the highest share in years. $10 BILLION was raised in one month by roughly 48 new VC funds (including a few from late September). 60%% of funds are targeting pre-seed/seed. The average fund size was $260M. I am back with October’s VC trends report, let’s dive in. 𝐓𝐡𝐞 𝐀𝐈 𝐜𝐨𝐧𝐜𝐞𝐧𝐭𝐫𝐚𝐭𝐢𝐨𝐧 𝐢𝐬 𝐮𝐧𝐩𝐫𝐞𝐜𝐞𝐝𝐞𝐧𝐭𝐞𝐝: 21 funds (44% of capital) explicitly targeting AI, that's $4.5B in a single month for one sector. (even the dot-com boom didn't see this level of thematic clustering?) 🇪🇺 𝐄𝐮𝐫𝐨𝐩𝐞'𝐬 𝐛𝐢𝐠𝐠𝐞𝐬𝐭 𝐦𝐨𝐧𝐭𝐡 𝐲𝐞𝐭: Not government subsidies, not tourist money, but institutional-grade funds with serious operational infrastructure: → Monterro: €1.7B with 150 developers in Vietnam supporting portfolio companies → Notion Capital: $130M with dedicated platform teams for product/GTM/pricing → 55 North: €134M for quantum computing (world's largest pure-play quantum fund) In the image below is a snapshot of the funds announced, showing: - fund name - fund size - geography - sector focus - stage - key LPs (The full table is in the report at the link below, hard to fit the whole one on here!) 𝐎𝐜𝐭𝐨𝐛𝐞𝐫 𝐡𝐢𝐠𝐡𝐥𝐢𝐠𝐡𝐭𝐬 𝐭𝐨 𝐤𝐞𝐞𝐩 𝐚 𝐩𝐮𝐥𝐬𝐞 𝐜𝐡𝐞𝐜𝐤 𝐨𝐧: ‣ 1. Defense tech is legitimate again $900M+ raised for defense/dual-use in October alone. ‣ 2. Climate tech requires specialization Generic "we care about ESG" is dead Burnt Island ($50M - water tech ONLY, Xylem as anchor LP). ‣ 3. Israeli ecosystem bifurcating Defense tech: 500% investment surge, $168M in govt funding Everything else: Fundraising at decade-low ($260M in H1 2025) 𝐓𝐚𝐤𝐞𝐰𝐚𝐲𝐬: ▪️Seed capital abundant but bar is higher (working prototype + early validation required) ▪️Geographic arbitrage is real ▪️Early-stage offers best risk/return in this environment ▪️Operator-led funds with real value-add winning competitive deals Hope you enjoyed this past month's breakdown. Drop your thoughts in the comments! PS: I compiled a 20-page VC report on October’s 2025 VC trends and patterns, check it out at the link below (and also launched a LIVE beta VC funds database!!): https://linktr.ee/ivelinad

𝗘𝘂𝗿𝗼𝗽𝗲’𝘀 𝗹𝗮𝗴𝗴𝗶𝗻𝗴 𝗽𝗿𝗼𝗱𝘂𝗰𝘁𝗶𝘃𝗶𝘁𝘆 𝗮𝗻𝗱 𝗥&𝗗: 𝗠𝘂𝗰𝗵 𝗺𝗼𝗿𝗲 𝗿𝗶𝘀𝗸 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝗻𝗲𝗲𝗱𝗲𝗱 ‼️ Last week the International Monetary Fund published a very interesting and comprehensive paper about the need for more venture capital in Europe to tackle our continents challenges. To name a few: ✔️productivity per hour worked is app 30% lower in 🇪🇺compared to the 🇺🇸 ✔️R&D investments are still way below the target of 3% per annum ✔️Within the top 100 tech companies worldwide merely a handful are European Is it all about 💶 I here you say? No it is about keeping up our welfare for future generations. And about a liveable planet. And increasing our innovation and competitiveness are crucial to do so. Which is also the key message of Mr. Draghi’s report I hope. The IMF report takes a deeper dive into the underlying issues: ✔️ VC investments are only 0,4% of GDP. In the US it is 3x as much ✔️Europeans park their savings in bank accounts. And banks are very risk aversie when it comes to financing hightech startups. ✔️Long term savings go primarily via pension funds, who hardly invest in VC in Europe (despite some positive signs recently) ✔️The EU has fewer and smaller VC funds leading to smaller rounds, less opportunities for scale-up financing and limited exit options ✔️ European scale-ups end up listing in the US instead of Europe itself ✔️ National fragmentation within the EU leads to a lot of barriers for scaling What has to be done? ✅ Increase efforts on a real single European market, for example by consolidating stock market exchanges and diminishing cross border red tape ✅ Make it more attractive for pension funds and insurers to step into VC ✅ Enhance the capacity of European Investment Bank (EIB), European Investment Fund (EIF) and national promotional institutes, like Invest-NL ✅ Implement preferential tax treatments for equity investments in startups and VC funds ✅ Encourage more funds-of-funds And I would like to ad to the findings in the report two things: 1️⃣ We need a cultural mind shift, more urgency and embracing true entrepreneurship 2️⃣ We have to step up our game when it comes to tech transfer. Transforming our high quality academic knowledge into economic and societal impact via startups.

An interesting trend we're seeing in the European PE market: North American PE investors are gaining share. They now account for 30% of all PE deals over €10m in EBITDA (up +9 p.p. over the last 7 years). A couple of reasons why: 📈 Europe has lower PE valuations compared to the US. This makes it an attractive market for both platforms and add-on deals. 📈 US sponsors have had stronger fundraising momentum than European investors. This has allowed them to outcompete in many deal situations. 📈 US sponsors are more familiar and experienced with alternative financing and private credit, given the higher maturity in their home market. This gives them an edge. Not to mention, many US investors have announced European expansion plans and launched dedicated funds in Europe. 💵 Thoma Bravo announced its first-ever €1.8bn dedicated fund in Europe. 💵 Blackstone announced an additional $500bn commitment for the next decade. 💵 Apollo announced plans to invest $100bn in Germany over the next decade. US investor activity is the strongest in: ⏫ UK&I (39% of all entries), DACH (27%) and Iberia (25%) ⏫ Large-cap transactions (>€200m EBITDA — 37% of entries) ⏫ Financial Services (42% of all entries) and TMT (31%) Where do local investors still dominate? 🇪🇺 France, Benelux and Nordics (~80% of deal flow is local) 🇪🇺 Small-cap transactions (<€10m EBITDA — 90% local) 🇪🇺 Science & Health, Services, and Consumer (~75% local) ________ FULL REPORT AND DATA We've just released a 44-pg report on the State of European Private Equity, covering entries, exits, holding periods, growth rates, and much more. Don't miss out on the 56+ charts. 👉 Get it here: https://lnkd.in/emkSDDzz #Europe #PrivateMarkets #Insights

Europe stands at a crossroads, facing pressure from geopolitical flashpoints and increasing protectionism, coupled with structural growth weaknesses. As we look ahead to 2025, Europe's top priority must be to strengthen its sovereignty in a shifting world order.   In my latest contribution to the World Economic Forum, I outlined four critical areas where Europe must take decisive action to maintain its place in the geo-economic showdown.    1️⃣ Europe must actively and pragmatically pursue free trade agreements. The recent breakthrough in the Mercosur deal presents a significant growth stimulus for the European economy and sends a strong message in favor of free, rules-based trade. What matters now is rapid implementation. 2️⃣ Europe needs to launch a strategic investment offensive for targeted funding of key technologies such as AI and quantum computing. Infrastructure investments for digital and green transformations are equally vital. 3️⃣ To effectively mobilize private capital, Europe must prioritize advancing the Capital Markets Union, enabling companies to access a wider array of European capital sources and enhancing economic sovereignty in an increasingly fragmented global economy. 4️⃣ Finally, we must simplify the regulatory landscape to facilitate faster project execution. This could involve implementing a “one in, two out” rule for new legislation and limiting the reappointment of retiring civil servants to one-third within the EU.   The path forward is clear: Europe's future geopolitical relevance hinges on a strong economy, necessitating massive investments and deregulation. It's time for Europe to step out of its comfort zone and prioritize its own interests to forge a stronger, more independent continent.   You can read the full article here: https://lnkd.in/eRC7VK6K   #WEF25 #Europe #RolandBerger

From Stockholm to London, the data tells a story that's reshaping European private equity. While it's not news that Nordic investors are long-time, significant investors in private markets and alternatives, Nordic institutions are averaging 12% private equity allocations while UK schemes sit at 7%, the real story is in the strategy shifts we are seeing. What caught my attention: Danish institutions writing €1-20M co-investment tickets, Swedish foundations embracing GP-led secondaries, and UK DB schemes using LTAFs for deployment flexibility. The institutions thriving aren't just adjusting portfolios, they're building flexibility into their entire approach. Sometimes the most important trends happen quietly, in the spaces between the headlines. This came through in our latest ‘Private equity trends’ report tracking holding periods, deal activity and allocator behavior: https://lnkd.in/e7neQTiR  #PrivateEquity #EuropeanMarkets With Intelligence

Henry McVey and team's latest “Thoughts from the Road” report offers valuable insights on Europe's evolving investment landscape. From an infrastructure perspective, one finding stands out: the substantial funding gap since COVID is creating significant opportunities for private capital. At KKR, we're seeing real momentum - expecting to deploy $25 billion across EMEA in 2025, with Infra activity in both core and large opportunistic deals running above trend into 2026. Governments across Europe are increasingly partnering with private capital to deliver critical infrastructure projects, a trend we expect to accelerate. Germany's €500 billion infrastructure program is particularly compelling, with over half the funds to be deployed within five years. This should create strong opportunities for strategic partnerships. The fundamental need for private infrastructure investment is evident. The combination of available capacity, rising structural spending needs, and governments seeking experienced partners to deliver those projects positions infrastructure investors as a key beneficiary of Europe's ongoing transformation. Read the full report here: https://go.kkr.com/4qUzWqE