Manifesto.

1.  In the early 200s, the idea that tech and entrepreneurship will change the world was fanciful. The Nasdaq had just crashed, and the message was simply inaudible.

2.  Since then, the European venture and growth market has considerably expanded:

• Approx. €5 billion was invested in the whole of Europe in 2003 in venture (excluding life sciences)

• 20 years later, in 2023, the amount has multiplied by 10x (the market went up as high as €100bn in 2021-22).

3.  In 20 years, the European market has also considerably changed. In many ways, Europe is getting more alike Silicon Valley: more ambitious; more connected; with bigger investors; and more serial entrepreneurs who are role models, investors and bring credibility and confidence.

4.  However, what has not really changed is the disparity between the US and Europe: approximately 1:4 in favour of the more established US market. Europe remains with: a relatively limited experience among entrepreneurs and investors; fragmented capital markets; small-ish home-grown funds.

5.  The good news is that Europe does not have a start-up problem any longer (even though one could argue there is considerable progress to be made in spinning off IP from universities).

6.  However Europe has a scale-up problem, big time. A couple of illustrations:

• Unicorn counts – the US represents more than half of all unicorns, Europe c. 20%

7.  What this means is that we need to get better at building larger companies which we can take to exit via M&A or IPO. In practice:

• Driving the level of ambition up

• Shying away from smaller exits – which is really difficult if you are a small fund, needing to show performance for your LPs (Distributed to Paid-In Capital - DPI)

8.  Interestingly Boston Consulting Group (BCG) did a study* which reflected on scale-ups impediments to growth. Among the Top 3:

• “Securing financing and, in particular, a lead investor”

• “Building and leveraging a strong and productive board of directors with independent members”

• “Developing a compelling business strategy and investment narrative”

9.  There is actually remarkably little actionable research on the issues facing a scale-ups. There are only a handful of exceptions, for instance https://www.indexventures.com/scaling-through-chaos/. There is much more to do.