On Wednesday 15 October, the European Commission’s financial services department (DG FISMA) published a study highlighting the persistent fragmentation of the European venture capital and growth sector, a major obstacle to the financing of innovative companies.
While the majority of funds and managers are concentrated in Western Europe, Southern Europe and Central and Eastern Europe are lagging behind.
This geographical concentration, combined with heavy dependence on external capital - up to 90% in some countries - is preventing the emergence of a genuine single investment market, noted the consultancy firms ‘Civitta’ and ‘Bourse Consult’, as well as the investor network ‘EBAN’, the authors of the analysis carried out on behalf of DG FISMA.
In addition to regulatory and tax divergences between EU Member States, the authors have identified structural obstacles: a cautious investment culture, a marked preference for domestic markets and a low level of involvement on the part of European institutional investors.
The authors recommend removing these obstacles through coordinated action combining legal harmonisation, improved supervision and greater investor confidence.
See the report: https://aeur.eu/f/j07 (Original version in French by Bernard Denuit)