2023-11-22-PitchBook-2023年三季度德国市场快照（英）-2023.11-21页_21页_3mb

Germany Q3 2023 Private Capital Market Summary

Core Content

This report provides a detailed overview of the German private capital market in Q3 2023, including macroeconomic trends, performance in public and private equity markets, venture capital (VC) and private equity (PE) deal and exit activity, fundraising trends, and notable developments in the industry.

Main Trends

Macroeconomic Overview

• GDP: Germany's GDP slightly shrank by 0.1% QoQ in Q3 2023, while CPI inflation declined to 4.3%.
• Interest Rates: The European Central Bank (ECB) maintained interest rates at -0.5% for the entire year of 2023, indicating a prolonged high-interest environment.
• Inflation Outlook: Inflation is expected to stabilize in 2024 but remain above the ECB's 2% target.
• Euro/Dollar Rate: The EUR/USD rate remained flat at €1.09.
• Consumer Confidence: Declined slightly to 98.5, with expectations of a downbeat 2024 due to the peak-rate regime.
• Unemployment Rate: Remained stable at 3.0% as of September 30, 2023.
• PMI: Both manufacturing and service PMI declined in Q3 2023, showing weak economic activity.

Public Equity Markets

• DAX 40: Increased by 10.5% YTD as of September 30, outperforming other European indices.
• P/E Ratio: Rose slightly to 13.8x in Q3, but remained depressed compared to 2021 peak levels.
• Public Listings: No public listings occurred in Q3, continuing a trend of depressed activity since Q2.
• Total Listings Since 2021: Only four public listings have occurred in Germany since 2021.

Venture Capital (VC)

• Deal Activity: VC deal value declined from Q3 2022 levels, with the highest deal being Helsing at €209.0 million.
• Top Valuation: Celonis is the highest-valued company in the region at €12.8 billion (post-money valuation).
• Sector Focus: IT and materials sectors attracted the most VC capital in Q3.
• Exit Activity: Minimal VC exit value in Q3, with all top five exits being acquisitions.
• Fundraising: VC fundraising in Q3 reached 46.8% of 2022 levels, with 11 vehicles closed.
• Government Support: The European Investment Fund (EIF) has been the largest LP in VC fundraising, while High-Tech Gründerfonds has made the most VC investments in the region.

Private Equity (PE)

• Deal Activity: PE deal value showed more resilience than VC, with the largest deal being the €2.6 billion buyout of STEAG by Asterion.
• Top Valuation: Vantage Towers is the highest-valued PE-backed company in Germany at €19.9 billion.
• Exit Activity: PE exit value increased in Q3 compared to Q3 2022, with all top five exits being buyouts or acquisitions.
• Fundraising: PE fundraising in Q3 exceeded 2022 levels, with a strong run rate in the first nine months of 2023.
• LP Commitments: The EIF has made the most LP commitments to PE funds in Germany over the past three years.
• GP Investments: EQT made the most PE investments in the region at 65, followed by Deutsche Beteiligungs.

Key Information

City Comparison (Private Market Activity)

Top VC Deals in Q3 2023

• Helsing: €209.0 million (Early-stage VC) - Aerospace and defense
• EGYM: €207.0 million (Venture growth) - Software
• Numa: €55.4 million (Early-stage VC) - Restaurants, hotels, and...
• Other Deals: Not fully listed in the provided data.

Top VC Exits in 2023

• All top five exits were acquisitions, with minimal exit value in Q3.

Top VC Investors (2020-2023)

• High-Tech Gründerfonds: 208 investments - Germany
• Innovationsstarter: 112 investments - Germany
• HV Capital: 101 investments - Germany
• Plug and Play Tech Center: 97 investments - United States
• Axel Springer Porsche: 84 investments - Germany

Top VC LPs (2020-2023)

• European Investment Fund: 25 commitments - Luxembourg
• KfW Capital: 9 commitments - Germany
• NRW Bank: 5 commitments - Germany
• Harel Group: 4 commitments - Israel
• NVPERES: 3 commitments - United States

Top PE Deals in Q3 2023

• STEAG: €2.6 billion (Buyout) - Energy
• Other Deals: Not fully listed in the provided data.

Top PE Exits in 2023

• All top five exits were buyouts or acquisitions, with PE exit value increasing sequentially.

Top PE Investors (2020-2023)

• EQT: 65 investments - Sweden
• Deutsche Beteiligungs: 53 investments - Germany
• Waterland Private Equity Investments: 49 investments - Netherlands
• DPE Deutsche Private Equity: 39 investments - Germany
• HarbourVest Partners: 39 investments - United States

Top PE LPs (2020-2023)

• European Investment Fund: 9 commitments - Luxembourg
• Phoenix Insurance Company: 5 commitments - Israel
• ATP Private Equity Partners: 2 commitments - Denmark
• BMO Private Equity Trust: 2 commitments - United Kingdom
• Columbia Threadneedle Investments: 2 commitments - United States

Key Developments

• Government Initiatives: Germany launched a €10 billion "Future Fund" in 2020 to support late-stage startups.
• Emerging Manager Facility: KfW Capital launched a €200 million facility to invest in smaller, gender-diverse VC funds.
• US-German Merger: General Catalyst merged with Berlin-based La Famiglia, signaling growing interest in the German VC market.
• AI Campus: Plans for an AI campus in Heilbronn (Innovation Park Artificial Intelligence) were announced, with €2 billion from the Dieter Schwarz Foundation and €50 million from the state of Baden-Württemberg.

Summary of Market Performance

• VC Performance: Weak deal activity and minimal exit value, with IT and materials as top sectors.
• PE Performance: More resilient deal activity, with growth in exit value and strong fundraising in 2023.
• Overall Outlook: While PE is expected to remain more resilient than VC, 2024 is less certain due to a tougher economic environment.

Conclusion

Germany's private capital market in Q3 2023 showed a mixed performance, with PE outperforming VC in terms of resilience and activity. Macroeconomic conditions remain challenging, with inflation and interest rates expected to stay elevated. Government initiatives and strategic investments are playing a key role in supporting the startup ecosystem, especially in the VC sector. The country's cities, particularly Berlin and Munich, remain central to VC and PE activity, though overall deal volume and exit value remain subdued.