Europe is pouring tens of billions of public money into VC. The hard part is making it work

The European Investment Fund is raising a €15 billion fund of funds called ETCI 2 that aims to unlock up to €80 billion in scaleup funding across Europe. Germany’s WIN initiative is targeting €12 billion by 2030. France’s Tibi programme has pledged €7 billion in private capital and labelled 92 VC and growth funds with a combined €22 billion in assets. The European Commission’s Scaleup Europe Fund is deploying €5 billion, with a fund manager expected to be selected this month. Add in the European Innovation Council’s €10 billion budget running through 2027, and the total public and publicly mobilised capital flowing into European venture and growth investing now exceeds anything the continent has attempted before.

The question is whether the money will solve the problem it is designed to address, or whether it will create new ones.

The gap that prompted the spending

European venture ...