European Venture Capital Dealmaking and Fundraising Activity Achieved New Annual Records in 2020

SEATTLE, Jan. 26, 2021 /PRNewswire/ -- PitchBook, the premier data provider for the private and public equity markets, today released its 2020 Annual European Venture Report, which found venture capital (VC) deal value remained aloft and set a new annual record despite COVID-19 and the subsequent macroeconomic damage. Pandemic-induced opportunities and existing VC companies within technology and healthcare were well positioned to grow at the same time the deluge of capital deposited into larger rounds continued a decade-long trend. Capital from the US flowed freely into Europe and deal value with corporate VC (CVC) participation set a new annual record. After a lethargic start, exit value gathered momentum as the year progressed with one of the strongest quarterly showings ever in Q4. The pandemic created favourable market conditions for VC-backed companies seeking an exit in sectors such as biotech and pharma. European VC fundraising also achieved a record high in 2020 as LPs and GPs across the continent shrugged off long-term concerns posed by COVID-19. Fundraising processes have successfully adapted to remote tools, while larger VC vehicles have attracted burgeoning heaps of capital from existing and nontraditional investors to target pandemic-proof and pandemic-induced opportunities. Restrictions on travel, recessions and battered sectors have not stifled commitments from LPs, as GPs have been supplied with record levels of capital to put to work heading into 2021.

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"Few predicted the insatiable appetite to commit to and invest in VC in 2020. While other asset classes crumbled amid widespread volatility, Europe's maturing VC ecosystem – and venture as an investment strategy – showed remarkable resilience with dealmaking, fundraising and CVC participation reaching record highs," said Nalin Patel, PitchBook EMEA Private Capital Analyst. "We believe capital will continue to pour into pandemic-driven areas as recoveries commence and the allure of a return to normality will drive capital into resurgent pre-pandemic trends, both of which will combine to hold overall VC activity aloft in 2021."

Investment Activity

Exit Activity

Fundraising Activity

• European VC funds raised a record €19.6 billion in 2020, representing a 35.2% year-over-year increase as LPs and GPs across shrugged off long-term apprehension posed by COVID-19. The quantity of closed VC funds ticked up to 172, reversing a two-year decline.
• VC funds over €100 million represented 82.0% of the total capital raised in Europe in 2020, just below the peak of 83.8% set in 2019, and we expect they will continue gaining share in 2021. Fund sizes have climbed during the last decade, buoying overall capital raised year to year.
• The UK & Ireland raised the most capital for venture funds with €5.1 billion, narrowly topping the DACH region, which raised €5.0 billion in 2020. Israel-based VC funds have now raised over €1.0 billion in each of the last five years, with a record €2.7 billion raised in 2020, and we believe GPs based in this region have the capital resources to develop their ecosystem even further and compete globally for commitments.

Additional coverage in this report includes:

• Introduction
• Overview
• Corporate VC
• Spotlight: 2021 Outlook
• Exits
• Fundraising

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About PitchBook
PitchBook is a financial data and software company that provides transparency into the capital markets to help professionals discover and execute opportunities with confidence and efficiency. PitchBook collects and analyzes detailed data on the entire venture capital, private equity and M&A landscape—including public and private companies, investors, funds, investments, exits and people. The company's data and analysis are available through the PitchBook Platform, industry news and in-depth reports. Founded in 2007, PitchBook has offices in Seattle, San Francisco, New York and London and serves more than 45,000 professionals around the world. In 2016, Morningstar acquired PitchBook, which now operates as an independent subsidiary.

SOURCE PitchBook