Private capital is reshaping Europe’s innovation landscape. Invest Europe’s latest report reveals that European private equity and venture capital assets hit a record €1.25 trillion in 2024, with venture capital dry powder rising to €59 billion — a clear signal of sustained investor interest in startups and future-focused industries.

Venture capital and private equity power Europe’s innovation, with dry powder hitting a record €414B

Private capital is playing a transformative role in Europe’s economic future. According to the newly released Positioned for the Challenge: Capital Under Management & Dry Powder 2024 by Invest Europe, the continent’s private equity and venture capital industry has grown its assets under management (AUM) to an all-time high of €1.25 trillion, marking a 2.6x increase over the past decade.

This rise is not just about numbers—it reflects the industry’s growing impact on Europe’s innovation, economic sovereignty, and strategic development in sectors such as AI, deep tech, and defence technology.

A Decade of Growth and Stability

The report covers 3,095 active firms and underscores over ten years of consistent growth since 2015. Of the total AUM, €834 billion is invested in portfolio assets at cost (PAC), including:

  • €507 billion in buyout funds, which surpassed the €500 billion milestone for the first time
  • €111 billion in venture capital, the first time VC portfolio assets have crossed the €100 billion mark

This trajectory demonstrates the private capital sector’s ability to support future-focused industries and act as a key engine for Europe’s long-term economic strategy.

Record Levels of Dry Powder Fuel Startup Investment

One of the standout figures in the report is the rise in dry powder—committed capital not yet invested—which hit a record €414 billion in 2024. This figure equals 81% of the €511 billion invested over the previous four years.

  • Buyout firms held €278 billion, a slight decline.
  • Venture capital dry powder rose to €59 billion, indicating strong investor confidence in startups and innovation-driven sectors.

This surge in unallocated capital, especially for venture investments, signals a clear readiness to back new companies driving Europe’s digital and green transitions.

Long-Term Trends Backed by Long-Term Investors

The report also reveals the resilience and consistency of capital deployment. Across fund vintages dating back to 2015, the time it takes for dry powder to fall below 30% of raised capital is typically 5–6 years, while maximum PAC levels are reached within 6–7 years.

Behind this growth are long-term investors:

  • Pension funds account for 26% of total dry powder.
  • Funds of funds and asset managers make up 19%.
  • Family offices and private individuals represent 13%.

Europe’s Future Is Private (Capital)

Eric de Montgolfier, CEO of Invest Europe, emphasized the industry’s momentum:

“Record capital under management also means more managers than ever invested in European companies, bringing their investment and expertise to build better businesses that support Europe’s economy and society.”

As Europe advances its green and digital goals, private equity and venture capital are not just growing—they’re becoming essential to funding the infrastructure, innovation, and resilience of the continent.