Private equity and venture capital fundraising reached €109bn, up 6% in 2019 – the highest total over a decade – according to new data from Invest Europe.
In parallel, the total equity invested in European companies increased 10% year-on-year to €94bn in 2019, the highest level on investment ever recorded.
In its report published this week – Investing in Europe: Private Equity Activity 2019 – Invest Europe, the association representing Europe’s private equity, venture capital and infrastructure sectors, presented fundraising and investment data covering more than 1,400 firms.
SME investment
The report shows that in 2019 private equity and venture capital firms invested in a total of 7,900 companies, 8% above the five-year average, some 84% of which were small and medium-sized enterprises (SMEs).
The European private equity industry invested in 22,000 SMEs between 2015 to 2019.
Invest Europe CEO Eric de Montgolfier commented: “In the midst of an unprecedented and unparalleled crisis, the private equity sector is uniquely positioned to help jump-start Europe’s economic and societal recovery, given appropriate recognition and support where required.
“Identifying and nurturing start-ups is essential for continued innovation in Europe, as well as laying the groundwork for a better tomorrow.”
Venture capital
He pointed to €15bn in venture capital fundraising in 2019 – a 17% increase on 2018 that also marks the seventh consecutive year of growth.
Venture capital funds invested €11bn in start-ups and scale-ups, 19% more than the previous year.
The European VC industry backed almost 4,700 companies in 2019, supplying funding to entrepreneurs in sectors including biotech/healthcare and ICT, key sectors in the battle against the Covid-19 pandemic.
Institutional investors
Institutional investors continued to demonstrate strong backing for European private equity in 2019.
Pension funds were the largest investor group, accounting for 29% of capital raised, taking their commitments to €114bn over the past five years.
Together with insurance companies, they make up 40% of the capital committed to the industry since 2015, a clear endorsement of the asset class’s contribution to returns and better pensions for European citizens.
Capital raised outside Europe increased to 45% of the total in 2019, led by investors from North America (28%). Fundraising from investors in Asia-Pacific also reached a new high of 16% of the total.
• The full report is available to download here