Private Equity News & Analysis

Fidelity collects £100m for first Europe-dedicated VC fund

Fidelity Growth Partners Europe's first fund has been backed by Fidelity affiliates.

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Fidelity Growth Partners Europe has closed its first European venture fund on £100 million ($162 million; €112 million), welcome news for Europe’s struggling VC industry. The fund is backed by “Fidelity affiliates”, according to partner Simon Clark, who declined to give further details.

The London based affiliate of financial services giant Fidelity was formerly known as the European arm of Fidelity Ventures, an early stage tech investment firm founded in 1969, whose fourth fund was increased in size to $400 million from $250 million in 2007.

Simon Clark
Its former US team recently spun out to form Volition Capital taking along some of the Fidelity Ventures portfolio, while Fidelity Growth Partners Europe continues to be affiliated with three Fidelity-associated venture groups: Fidelity Biosciences in North America, Fidelity Asia Ventures in China and FIL Capital Advisors in India.

The London-based team said in a statement it has deployed more than $150 million in European venture investments since its establishment in 2000. Its investments have included secondary ticket seller Seatwave and virtual server company Neverfail.

Clark said the fundraise is “a testament to the way the technology market has developed across Europe during the last 10 years as well as to the innovation and skill of European entrepreneurs”. 

He added that the European venture market has “the potential to drive significant returns for venture investors”.

Both the UK government and the European Venture Capital Association are hoping to help illustrate that, and subsequently stimulate private sector interest in the asset class and support European SMEs, with the creation of government-backed fund of funds schemes.

EVCA director Thomas Meyer told PEO in October that the trade body believes matching public funding can be a powerful incentive to attract private capital, which the European venture industry lacks.

Unlike the US, where university endowments have long supported venture funds, Europe has “no role models of institutional investors that have truly been successful with European venture capital”, Meyer said. “Over the last decade the private sector fund of funds found it immensely easier to market the buyout strategy.”