The Pitchbook Q3 EU Venture and Private Equity Reports
Published 10 November 2021
Pitchbook has published its European Venture Report for Q3 2021 as well as it European Private Equity Breakdown for Q3 2021. Below we outline the highlights.
EU VC Report
The European Venture Report for Q3 2021 reveals that Q3, in line with the previous two quarters of 2021, has seen significant activity in relation to venture deals totaling €24 billion, being the second-highest on record and only beaten by Q1 of 2021. Q3 brings the year-to-date total venture deal value to just short of € 74 billion.
Especially late-stage capital has been incremental to the record-breaking quarters of 2021 so far amounting to 73.7% (€ 54.3 bn) of the total venture deal value of 2021. Additionally, the quarter has seen several significant late-stage investment rounds in fintech companies, including Revolut, Klar, Monzo and Curve.
Q3 has also seen the US investor participation in the European venture capital market remain strong as 21.2% of venture deals YTD have had US investor participation. While Q3 points to the fundraising market ending the year in line with previous years as far as fundraising value, the fund count estimated to close the year at 128 being the lowest since 2013.
Delve deeper into the key trends that have set the tone for the European venture capital market in Q3 2021 here.
EU PE report
The European private equity deal activity has set new annual record, being helped along by among other things strong leveraged lending markets, willing sellers and market stimulus from institutional investors to catch-up from a slower 2020.
With a total deal value of € 548.7 billion and the deal count on pace to land at an expected number of 5,492 (approx. 33% higher than 2020), the European private equity market has been red-hot. However, the deal volume is falls short, down almost 4% compared to Q1-Q3 of 2020 and the average deal size saw lower year-on-year increase.
In regard to exits, the European PE market have reached new highs with a total exit value of € 250 billion, exceeding 2020 with almost € 50 billion and quickly closing in on 2019 with still a quarter left. Especially the Nordics have seen an increase in exit value performance reaching a new annual record of €51.3 billion, up more than 80% from the previous annual high of € 28 billion. Part of the increase of the overall exit performance can be ascribed to a significant uplift in liquidity events due to corporate acquisitions.
As is seen in the European VC market, the fundraising market has seen an increased flight of capital towards established and well-proven managers with total fundraising value expected to land close to previous years at around € 100 billion, but with the fund count sitting at 104 being the lowest since 2012.
Pitchbook expects the European private equity deal activity to slow down in Q4 of 2021 as the sponsors have caught-up on dealmaking after 2020.
Pitchbook’s report on Q3 in the European private equity market can be found here.