Europe launches its largest ever venture capital fund of funds at 15 billion euros
The European Investment Fund has unveiled a 15 billion euro fund of funds, the largest of its kind in Europe, as part of a sweeping initiative to address the continent's persistent shortage of late-stage venture capital. The vehicle, named ETCI 2, will back around 100 growth-stage funds and aims to unlock up to 80 billion euros in follow-on investment for European tech companies.
The new structure is the second generation of the European Tech Champions Initiative, first launched in 2023 to close what the EIF estimates as a 70 billion euro funding gap at late stages between Europe and the United States. The original ETCI raised 3.9 billion euros and backed 14 mega-funds from firms including Atomico, Headline and Eurazeo, indirectly supporting 40 companies, among them 11 unicorns such as AI translation company DeepL, travel software provider TravelPerk, and web creation platform Framer.
ETCI 2 represents a substantial expansion. It will invest across two fund categories: mid-sized vehicles raising between 300 and 600 million euros, and mega-funds targeting around 1 billion euros. Individual company investment amounts could reach 200 million euros, compared to an average of 60 million euros under the first program. EIF Deputy Head of Investments Uli Grabenwarter described the new fund as operating at "a completely different level."
While ETCI 1 drew support from the European Investment Bank and six EU member states, namely Germany, France, Italy, Spain, Belgium and the Netherlands, the successor fund is seeking a significantly broader pool of contributors. The EIF and EIB have already committed 1.25 billion euros, and the fund plans to bring in institutional investors such as insurers, pension funds and commercial banks. A dedicated platform for targeted commitments is set to open in the second quarter of 2026, with a first close expected by summer.
The initiative runs alongside a separate European Commission effort, the planned 5 billion euro Scaleup Europe Fund, which will invest directly in deep tech companies. Grabenwarter told Sifted that the two initiatives are "complementary," noting that the Scaleup Fund could itself become an investment target for ETCI rather than a competitor. The Scaleup Europe Fund is expected to begin operations in spring 2026, once its fund manager is selected.
Together, the programs reflect a coordinated European push to retain homegrown companies by preventing them from seeking capital, and relocating, abroad. "Some markets, like Germany and France, are quite capable of developing mega-funds," Grabenwarter said. "Other EU countries do not yet have such a pipeline," making the expansion toward mid-sized funds essential.
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