PitchBook News - Why VC is booming in Europe

European PE exits also roared to record highs in 2021.

GPs tend to be opportunistic when it comes to exit timing, and 2021 proved to be the hottest exit market on record, driven by the strongest IPO market ever.

Sponsors pursued public listings at a record clip, as the unprecedented stimulus drove public valuations north, lifted by public equity investors' willingness to pay outsized premiums for fast-growing private companies, powered in part by FOMO.

European PE fundraising slowed in 2021 but was still historically strong.

However, fund count saw a steep deceleration to its lowest total in nearly a decade, as LPs consolidated GP relationships and funneled more capital to their largest, existing, and more-experienced managers.

In 2021, the critical drivers of a healthy fundraising environment sustained, including low interest rates, record public market valuations, and public market volatility.

While the major concerns for LPs moving into 2022 will be higher long-term inflation, tightening policy, mountains of dry powder, and GPs' ability to put capital to work quickly, allocators remain positive on their private markets allocations, especially for buyouts and growth funds managed by GPs with a compelling equity story and strong track record.

For more data and analysis, click to download our free 2021 Annual European PE Breakdown.

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