Buyout fundraising in Finland reaches 636M€ – IPO the most prominent exit route
Invest Europe and Finnish Venture Capital Association (FVCA) have collected data on Finnish private equity activity. *
Finnish buyout funds focused on active fundraising in 2017, as statistics show total fundraising in Finland reaching its highest level in a decade. Out of total fundraising, the share of growth capital fundraising has been gradually gradually growing. The IPO market has also shown its continued strength, with significance of initial public offering (IPO) as an exit route increasing.
Statistics from year 2017 show fundraising of Finnish buyout funds reaching its highest level since 2008 at 636 million euros – an increase of 76% from the previous year. The accumulated dry powder of Finnish buyout funds now exceeds 1,5 billion euros, and the capital raised will be deployed to boost growth of mature SMEs and growth companies, mainly in Finland, within the upcoming years.
All in all, over 60 companies receive an investment from a Finnish buyout investor yearly. Looking at a five-year average, typical buyout investments size in Finland is around 6 million euros.
Another notable trend is an emergence of new growth funds, which are already grasping 21% of total fundraising. The strategies of these funds typically range from scaling up venture-backed companies to making minority equity investments in mature SMEs, the focus of Finnish growth funds being mainly on the latter one.
”The Finnish private equity landscape is maturing and becoming more diverse. From entrepreneur’s perspective this means it is step by step easier to find a suitable investor for each growth phase. For example, the emergence of growth funds is an excellent example of development that stems directly from a real market need”, says Pia Santavirta, managing director of FVCA.
Potential IPOs in Finland
Finnish companies received over 2 billion euros in buyout funding between 2015-2017. Almost half of this comes from international investors. The target companies are usually part of their investor’s portfolio from 3 to 7 years, after which the investor exits the company.
By the amount of cost, the most prominent exit route last year was initial public offering (IPO) or sale of quoted equity. Consequently, the majority of new companies listed in Helsinki Stock Exchange in the recent years have been private-equity backed – 62 % of all listed companies in 2017 had had private equity investor backing them either right during IPO or earlier in their growth path.
The annual Potential IPOs in Finland -listing released today by Finnish Venture Capital Association includes again several Finnish companies from a variety of domains, which are expected to be seen in Helsinki Stock Exchange in the upcoming years.
Henrik Husman from Nasdaq Helsinki awaits the positive market sentiment to continue also in 2018.
“Of all listings, the share of private-equity backed companies going through IPOs has remained significant in the recent years, and it has now even grown year-to-year. It is great to see that the Finnish capital market ecosystem has and will continue to work effectively”, he comments.
Finnish Venture Capital Association, Managing Director
+358 40 546 7749
Finnish Venture Capital Association, Head of Communications
+358 45 138 5002
*Statistics under term ‘buyout’ cover buyout, generalist, mezzanine and growth funds.
Finnish Venture Capital Association (FVCA) is the industry body and public policy advocate for the venture capital and private equity industry in Finland. As the voice of the Finnish VC and PE community and the entrepreneurs they fund, it is our role to demonstrate the positive impact of the industry on the Finnish economy. FVCA – Building growth.
Potential IPOs in Finland 2018-2022
The list has been compiled based on a questionnaire sent out to investors and it is non-binding. The companies listed below may be seen in the Helsinki Stock Exchange during the next five years, but the final decision depends on multiple varying factors.