European venture capital firms have invested over €96bn in almost 27,000 European companies and delivered 23% net annual returns over the last ten years, according to a new Invest Europe report.
The Venture Capital: Fuelling European Innovation Report also highlights the step change in European VC fundraising over the five years to 2022, including an eight-fold increase in capital raised by Nordic VCs and a three-fold increase for DACH managers, as capital committed to funds reached a record €23bn last year. It also notes that European VC’s 12% net return since inception, far outperforms the MSCI Europe benchmark, which returned 7.67% pa over the same period.
According to the report, recent performance has accelerated, with European VC delivering a net return of 23.07% over 10 years, creating wealth for long-term investors including funds of funds investing on behalf of pension funds, family offices, and corporate investment divisions, with companies backed by venture capital have generated double-digit employment growth in most years since 2018, including 15.3% net new jobs in 2021, compared to 1.2% growth for all European companies.
It also notes that European venture capital dry powder also rose to a record high of €53 bn in 2022.
