European Venture Capital's Structural Weakness

Over the last few issues, EVCJ has been running a series of articles looking at the problems, both real and perceived, with European venture capital. In one of the pieces I argued that one reason why European institutional investors are so reluctant to invest is because allocation rules are too restrictive, and that governments should address this issue if they really are interested in stimulating early-stage investment. I recently received an email, from a source who will remain unnamed, challenging this line of argument. His approach was that Europe suffers from a structural weakness which restricts the number of investors who would be interested in committing to European VC.

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