German Mittelstand turns to venture building and VC investing

Germany and Austria's economies are buoyed by medium-sized family businesses and they have a big advantage: they're more likely to look at #venturebuilding as a key part of their activities from the outset, even if they aren't #CVC investors. It's a model that could be replicated by similar-sized businesses worldwide. Link in comments for full story. Huge thanks to Florian Noell, Sascha Hempel, Daniel Hinz, Matthias Hille, Achim Plum for their inputs.

'Europe must advance the Savings and Investment Union. Key steps include harmonizing listing rules and easing cross-border IPO access. The end goal must be a true pan-European stock exchange – and German Chancellor Friedrich Merz’s recent support for this idea could mark a watershed moment' https://lnkd.in/e2kkYr5Z

Italy’s economic revival has made it an investor darling. Executives say private markets are set to underwrite the bulk of that growth. Few takeaways from our Bloomberg Future of Finance event in this article, with my esteemed colleagues Tiago Alfaro and Luca Casiraghi: *Most companies are still reluctant to IPO in Italy, even after stock markets reached two-decade highs *The business of making private loans — a key component of the private capital boom — is drawing more players in Italy *Real estate is also an area that’s attracting private capital with high returns for investors https://lnkd.in/gBbCfn2D

Survival of the fittest. That’s what VC is in France right now. Just look at the charts. It shows clearly that in 2025:  ➡️ Same amount of € as in 2024 ➡️ 200 deals less YoY comparison At the same time of the year in 2024, 600 deals were done. This year we’re barely reaching 400 deals.  A 33% decrease. You think it’s a sharp drop?  Think again, 2024 was already showing -34% in deal making activity vs 2023.  So we’re now down 50% in deal making activity since 2023. The biggest problem is the global amount of funding (in B€) is roughly the same for 2023, 2024 and 2025. Meaning only one thing: fewer companies are competing for the same amount. The deals are getting bigger but the number of companies making it through series A, B or C keeps getting smaller. I start to understand why I see so many posts of french founders moving to SF lately.  If you need to compete hard, you might as well do it in a place that rewards success.

Only about 5,000 of the 15,000 or more private capital firms that exist today had successfully raised funds in the past seven years, Per Franzén, chief executive of Sweden’s EQT, told the FT. “How many of these firms will have a successful fundraising also in the next five to 10 years? . . . Probably less than half,” he said. “The number of zombie firms will increase by an additional couple of thousand.” Struggling to raise new funds, PE have sought to increase the amount of fees they can generate from existing funds, as well as leaning more heavily on continuation vehicles. “It’s not a sustainable business model to squeeze out fees out of . . . existing funds and to opportunistically raise continuation vehicles,” he said. “At some point, these firms will cease to exist.” Just 50 to 100 globally diversified firms would capture around 90 per cent of capital flowing into private markets in the next fundraising cycle, the Swedish executive predicted. As of October, the number of private equity funds to reach “final close” this year was on track to be the lowest in at least nine years, according to Preqin data. https://lnkd.in/ePnR-7uC

Top 10 Private Equity Firms in Frankfurt! Frankfurt stands as one of Europe’s top private equity hubs — a gateway to Germany’s powerful Mittelstand, deep capital markets, and the European Central Bank. The city blends financial strength with entrepreneurial spirit, making it a hotspot for PE activity. Here are 10 leading firms shaping the region’s private markets: 1. Deutsche Beteiligungs AG – Veteran investor in mid-sized German businesses, focused on IT, healthcare, and infrastructure. 2. Palladio Partners – Independent boutique advising institutions on infrastructure, PE, and private debt. 3. VR Equitypartner GmbH – DZ Bank subsidiary offering flexible, long-term capital for SMEs. 4. ECM Equity Capital Management – Specialist in growth and succession deals for Mittelstand companies. 5. Deutsche Private Equity (DPE) Deutsche Private Equity – Growth investor in companies with €20–500M revenue across the DACH region. 6. HQ Capital – Global private equity allocator managing $13B across funds, secondaries, and co-investments. 7. NEXX Capital GmbH – Formerly HQ Equita; focuses on SME buyouts and growth across Germany, Austria & Switzerland. 8. ELF Capital Group – Provides flexible private debt and hybrid financing solutions for European mid-market firms. 9. Beyond Capital Partners – Invests in profitable, asset-light SMEs in DACH, focusing on long-term trends. 10. COI Partners – Growth equity investor backing scale-ups and expansion-stage companies. Want access to detailed profiles like these, plus data on thousands of institutional investors and fund managers? Book your demo now! https://lnkd.in/ew_EA9Sj #PrivateEquity #Frankfurt #Investing #VentureCapital #Finance

'More start-ups have formed across Europe in recent years, fueled by world-class research hubs in Britain, booming tech sectors in France and Germany, a high venture capital presence in Estonia and robust backing by pension funds in Sweden.' https://lnkd.in/dek3uPmw

𝐄𝐮𝐫𝐨𝐩𝐞𝐚𝐧 𝐩𝐫𝐢𝐯𝐚𝐭𝐞 𝐞𝐪𝐮𝐢𝐭𝐲: 𝐧𝐨𝐭 𝐛𝐞𝐡𝐢𝐧𝐝, 𝐣𝐮𝐬𝐭 𝐛𝐮𝐢𝐥𝐝𝐢𝐧𝐠 𝐝𝐢𝐟𝐟𝐞𝐫𝐞𝐧𝐭𝐥𝐲 It’s always good for Alexander Steeb and myself to connect with people who see private capital the same way, not just as money in motion, but as a driver of growth and innovation. Europe’s private markets have really come into their own. Private equity and growth funds have been outperforming public markets, and the overall market is expected to reach over $3 trillion by 2025, growing from there. Still, private assets here make up only about 8% of GDP, compared to roughly 17% in the U.S., which means there’s a lot of upside ahead. That’s what makes events like SuperReturn Europe in Amsterdam so relevant; you can feel that Europe isn’t playing catch-up anymore, it’s defining its own path in private markets.

As start-up ecosystems mature worldwide, VC deal terms reveal both convergence and contrast. MoFo's 2025 Global VC Terms Report unpacks how investors and founders are reshaping market norms across nine major jurisdictions: the US, UK, Singapore, Hong Kong, Mainland China, Japan, Israel, Germany, and Latin America. Read MoFo’s latest report for more insights: https://bit.ly/4npsgK7