European venture capital funds get their inaugural closure on Adams Street
Riding the Wave of Venture Capital in Europe: Adams Street's €270 Million Debut
By Phil Habdank, Frankfurt
In a significant milestone, Adams Street Partners, the US asset manager, has shut the curtains on its first European venture capital fund with a whopping €270 million, surpassing its initial budget of €200 million by a cool €70 million. On the global front, the group's VC flagship fund has reported a closure of $1.2 billion, underlining Adams Street's robust presence in the European venture capital arena.
“Germany is the cornerstone of European VC,” Partner Ross Morrison said to the Financial Times, highlighting the nation's crucial role. “We don't foresee any major setbacks in the mid-term. German startups continue to attract capital,” he added, implying a buoyant VC landscape in the coming days.
Germany serves as a hub for VC activities in Europe, boasting successful ventures such as Celonis, Personio, Trade Republic, Quantum Systems (Munich), and Parloa (Berlin). Morrison estimates a whopping 684 European "unicorns" with valuations exceeding a billion dollars across 71 cities.
Funding the Future: Adams Street's Next Move
The recently raised €270 million will fuel investments in other VC funds, with 70-90% of the capital expected to be channeled this way. The remaining portion will be utilized for co-investments and secondary deals. Adams Street intends to concentrate on the early stages of the VC value chain, with approximately 70% of its funds earmarked for early-stage funds. To date, the fund has poured money into 13 VC funds and executed a series of co-investments and secondary deals.
As the fund's investments are underway, Adams Street is already contemplating future VC funds, although Morrison maintains that it's too early to divulge fresh target sizes.
Europe's Thriving VC Landscape
The favorable turn of events for Europe's VC scene is evident, as fundraising picks up the pace after a tumultuous period. A data provider, Pitchbook, revealed that 24 funds scrapped together €2.3 billion in Europe during Q1, highlighting the increasing appeal of European VC ventures.
Interestingly, most capital was raked in from German-speaking regions, with sectors like cleantech and biotech emerging as popular choices. For instance, French healthcare investor Sofinnova Partners, in March, announced it had raised an impressive €1.2 billion in 2021, with €1 billion raked in during the final quarter alone. Such mega-closings in the final hours have a profound impact on projected figures, making fundraising estimations a challenge.
The report underscores investors' growing willingness to entrust their funds to established as well as new managers. In Q1, approximately 70% of the funds raised went to novice managers, including six debutantes. The second half of the year looks promising, with 20 yet-to-close VC funds eyeing a jaw-dropping €15 billion.
[1] Source: PE Hub[2] Source: TechCrunch[3] Source: TechCrunch Europe[4] Source: Financial Times[5] Source: PE Hub Europe
The €270 million raised by Adams Street Partners will primarily fund investments in other venture capital funds, with the remainder being allocated for co-investments and secondary deals, indicating a focus on technology-driven startups. (finance, technology)
The surging interest in European VC ventures, as demonstrated by fundraising figures, suggests a shifting lifestyle trend focused on finance and innovation, with sectors like cleantech and biotech attracting significant investments. (lifestyle, finance)
