A recent analysis forecasts contrasting trajectories for European private equity and venture capital assets under management (AUM) over the coming five years. Drawing on drawdown fund data and established forecasting methods, the research team’s report at PitchBook highlights how recent market dynamics will shape the region’s private capital landscape.
PitchBook also pointed out that European VC AUM is projected to contract notably, reversing the strong expansion seen over the prior decade.
In the base-case scenario, VC assets are expected to drop from $431.4 billion at the end of 2025 to $311.4 billion by 2030.
This decline stems largely from persistently weak fundraising, with both capital raised and the number of funds falling annually since their 2022 peak. Even if activity rebounds, current trends offer little optimism for a quick recovery in overall assets.
The sector’s recent history underscores this outlook. VC AUM surged to $422.5 billion in 2021 amid record deal and exit activity before pulling back and then reaching a new high by late 2025.
However, inconsistent deal flow, subdued exits, and limited distributions to limited partners (LPs) have created headwinds.
Returns have often fallen below historical averages, while many startups face slower valuation growth, write-downs, or withheld pricing details.
The post-pandemic boom has given way to a more measured environment, with a notable scarcity of liquidity events continuing to pressure the ecosystem.
Scenario modeling reinforces caution. Best- and worst-case projections for 2030 range from $406.2 billion to $243.9 billion, meaning even the optimistic outcome remains slightly below 2025 levels.
High variability reflects concentration risks—particularly AI-driven deals focused on larger companies—and the outsized influence of major funds.
While AI investments have accelerated sharply over the past 18 months, major exits remain elusive in Europe compared to the US, leaving future performance uncertain.
In contrast, European PE AUM is set for continued, albeit moderate, expansion.
The base case anticipates growth from $1.5 trillion in 2025 to $1.7 trillion by 2030, equating to a roughly 3% compound annual growth rate.
According to insights from PitchBook, this steady climb mirrors the asset class’s resilience over the past decade, during which AUM expanded year after year from $534.6 billion in 2015.
PE activity has proven more stable than VC, with deal values hitting records in 2025 and capital raising achieving new highs in 2023–2024.
Downside and upside scenarios for PE show AUM holding at $1.5 trillion or climbing to $2 trillion, suggesting reliable growth with the magnitude depending on fundraising and performance trends.
Factors such as multiple expansion, margin management amid inflation, and the ability to pass on costs will play key roles.
Evolving structures—including secondaries, evergreen funds, and greater access for pension, sovereign wealth, and retail investors—could further support expansion.
Geopolitical tensions and interest rate volatility introduce risks, given PE’s reliance on leverage, but the overall trajectory remains positive.
Geographically, the UK is expected to maintain dominance. It should represent 31.5% of European VC AUM and 38.8% of PE AUM by 2030 (approximately $137 billion and $673 billion, respectively).
France, Germany, the Netherlands, and Israel will remain significant VC contributors, while Luxembourg, Sweden, France, and Switzerland will feature prominently in PE.
Favorable tax regimes and fund domiciliation practices bolster certain jurisdictions, even as capital deploys into broader innovation hubs.
Looking ahead, PE’s consistent progress contrasts with VC’s challenges stemming from post-boom adjustments. AI outcomes, interest rate paths, and geopolitical developments will heavily influence results.
Broader participation across fund sizes, regions, and investor types could help Europe narrow gaps with global peers. PitchBook has concluded in the research report that the forecast points to maturing, diverging private capital segments rather than uniform advancement.