Beyond IPOs: Looking at The Quiet Rise of Creative Exits in European Private Equity – 0100 Weekly Brief
Hello, there!
Many of us expected 2025 to be the year of comeback for IPOs and M&A. However, new tariff announcements and global uncertainty have led the market to shut down any early signs of recovery and pushed many buyers to pause their deals.
The IPO activity in London is hitting a 30-year low, and only seven companies were listed on the London Stock Exchange in 2025, pushing top fund managers to call for urgent government action. They argue that without stronger incentives and reforms, the London Stock Exchange will become unattractive.
Synthesia’s founder, Victor Riparbelli, has voiced a similar view. His AI startup—now Europe’s most valuable—made headlines when he stated he would “never” take the company public in Europe. His remarks mirror those of Bitpanda’s CEO, who also dismissed London as an option, citing poor liquidity and highlighting the growing trend of companies shifting their listings to New York.
Europe’s IPO market, which has struggled with years of volatility and investor caution, is preparing for a fresh round of listings that could test whether confidence is truly returning. Additionally, we see Sweden becoming an attractive spot for IPOs, with Stockholm’s stock market drawing attention from international players, like Swiss family office Infinitas Capital, which plans to list multiple companies there because of its strong liquidity for smaller firms.
These deals come after many European firms shelved IPO plans in recent years, turning instead to more creative alternatives.
Why creative exits matter in 2025
With this narrowed path for cashing out, firms are also increasingly looking for other creative methods to return capital, such as secondaries and continuation funds. Several asset managers have expanded in private markets, also through acquisitions and partnerships.
These mechanisms allowed GPs to hold onto assets until they were ready for a fuller exit while still providing interim liquidity to investors. Although not a substitute for IPOs or trade sales, these financial tools played an important role in easing pressure on funds and investors.
For example, Mistral and Klarna provide the best examples of how leading companies are pursuing different paths to scale or deliver liquidity to investors. Mistral is preparing to use acquisitions as part of its expansion. The company has raised over €1 billion to date and is reportedly close to securing an additional €2 billion, bringing its valuation to nearly €12 billion.
On the other side, Swedish payments group Klarna has officially filed for an IPO on the New York Stock Exchange. The company plans to sell 34.3 million shares at an expected price range of $35 to $37, potentially raising $1.27 billion. The IPO, delayed earlier in 2025, reflects renewed access to public markets for European scale-ups, albeit at recalibrated valuations.
We heard similar insights from the investors’ side as well, with firms like Schroders Capital, who doubled down on GP-led secondaries, or H.I.G. Italy, which recently mentioned in a discussion with Laura (check interview below) that private equity firms are now more open to partnering with family-owned businesses to scale mid-market firms.
Why is this important for Europe
Private equity continues to account for a significant share of global M&A activity, with dry powder exceeding $2 trillion. In Europe, the sector is sitting on a large backlog of companies; more than 13,000 unsold portfolio firms remain on the books. At the same time, investors want and will continue to look for more cash returned.
Europe’s M&A market also benefits from a lower cost of capital following the ECB’s June 2025 rate cut and a stronger euro. Continuation funds and other secondary structures are emerging as tools for Private Equity to return capital to investors while keeping certain assets in their portfolios.
Secondary investments can improve private equity allocations by addressing common challenges of traditional funds. They help investors bypass the J-Curve by providing quicker liquidity through LP-led transactions, where distributions often arrive sooner than in primary funds. They also offer immediate exposure to proven assets, enabling investors to evaluate performance and quality upfront.
📝 Expert Round-up | From Family Ownership to Scalable Growth
In our latest expert interview series featuring upcoming speakers at 0100 International, we had Raffaele Legnani, head of H.I.G. Italy, who outlined how mid-market firms in Italy are adapting to a new environment of sustainable interest rates and heightened sovereign debt risks. He noted that financing remains available through banks and increasingly competitive private debt funds, but uncertainty linked to public debt is a challenge for investors.
On exits, Legnani confirmed that trade sales, IPOs, and secondary sales remain the main paths, though activity is slowed by valuation gaps rather than lack of demand. He highlighted that continuation funds are used selectively, only when more time is needed to realize value. Italian family businesses, he added, are increasingly open to private equity partnerships, often selling majority stakes while retaining minority positions to ensure alignment and continuity.
🗓️ Unlocking Liquidity at 0100 International
With LP liquidity needs rising, portfolios maturing, and macro conditions still uncertain, the secondaries market is seeing unprecedented growth. This session at 0100 International will explore how GPs and LPs are using tools like continuation vehicles and secondary funds to manage capital, extend ownership of top assets, and prepare for the years ahead.
The panel brings together senior voices from across Europe’s private equity landscape: Matilde Horta e Costa (Arcano), Thomas Hallinger (Golding Capital Partners), Miguel Echenique (Altamar), and Yvan Chene (Capital Dynamics). With experience spanning secondaries, GP-led transactions, private credit, and fund-of-funds strategies, they’ll share insights on what these shifts mean for investors and managers alike.
Join the discussion to hear how market participants are positioning for 2026 and beyond.
🌍 Across the Ecosystem | News & Useful Resources for You
We’re not the only ones rethinking what “exits” really mean in private equity today. With IPOs slowing, valuation gaps in M&A, and growing use of continuation funds and secondary deals, the conversation around liquidity, timing, and alignment between GPs and LPs is gaining momentum across Europe and beyond.
Here’s a spotlight on different perspectives shaping this new exit landscape.
📄 Article | London’s IPO drought: Fund managers turn to private assets to ease pressure
London’s IPO market remains weak in 2025, with only seven companies floating on the London Stock Exchange so far this year compared with 231 in the U.S.. To offset the decline in UK equities, many asset managers are reallocating resources to international stocks and private markets.
Recent government reforms, such as the Mansion House accord, require pension funds to allocate 10% of assets to private markets by 2030, with half directed to UK investments. These changes, alongside new rules allowing ISAs to include long-term asset funds, reflect a policy push to channel more capital into private assets as London’s IPO drought continues.
📄 Article | Lakestar closes $265m continuation fund
Lakestar, the European VC firm behind companies such as Spotify and Revolut, has closed a $265m continuation fund, one of the largest of its kind in Europe.
Continuation funds allow firms to transfer a set of portfolio companies into a new vehicle, enabling existing limited partners to either cash out or roll over their stakes, while the GP can hold onto assets for longer to capture additional value. The fund is backed by Lexington Partners as lead investor, alongside Industry Ventures, Performance Equity Management, and other secondary investors.