Invest Europe’s new Venture Capital: Fuelling European Innovation report is reporting that the continent’s VC investment last year was nearly two-and-a-half times greater than it had been a decade before.
The report also states that European startups supported by VC employed over one million people, while VC funds on this side of the Atlantic outperformed their North American peers over ten- and fifteen-year periods.
Eric de Montgolfier, CEO of Invest Europe, commented: “Innovation is Europe’s lifeblood—more critical than ever for a thriving, sustainable future. Venture capital is hardwired for this, fuelling startups that improve lives, tackle the challenges of the energy and digital transitions, and sharpen Europe’s global edge.”
He added: “European venture capital delivers more than financial gains; it powers job creation and competitiveness. After a decade of rapid growth, the right support and incentives can take it further, driving innovation, launching world-class startups, and multiply the benefits for all of Europe.”
Invest Europe also said that VC funds invested in excess of €143bn over the last ten years into more than 26,100 start-ups, including €16.5bn in VC and growth-stage companies in 2023, 2.3x the amount invested in 2014.
It also said that fundraising has grown exponentially, with VC firms raising €14.2bn in 2023, representing 3.7x growth over 10 years in France & Benelux, 3.4x in the Nordics, and 6.3x in Southern Europe.
Over the same 10-year period, European venture capital generated net returns to investors of more than 20% annually, beating funds from North America and the Rest of the World.
Invest Europe also said European venture capital has returned 11.49% since performance records began in 1986, well ahead of the MSCI Europe’s return of 8.05% for the same timeframe, highlighting the long-term outperformance by European venture capital, as well as an acceleration in returns in more recent years.
The research was put together using the European Data Collective, a hub for information partially owned by the organisation. Its data is reportedly gleaned from more than 4,200 firms managing over 12,000 funds. Overall, Invest Europe calculates that the European Data Collective has information on 91% of the €1,154bn of capital under management across Europe.
