European VC takes the lead in 2023 HEC Paris-Dow Jones Venture Capital Performance Ranking for the first time

A new study conducted by strategy Professor Oliver Gottschalg at HEC Paris revealed a shift in the global venture capital (VC) landscape, with three European firms breaking into the top five and nine out of the top ten firms being non-U.S. entities. Notably, for the first time, a European VC has claimed the top position in the HEC Paris-Dow Jones Venture Capital Performance Ranking, challenging the long-standing dominance of U.S. firms. 

Luxemburg’s Earlybird Digital East Fund has secured the top position, marking a milestone for European venture capital. Earlybird is known for its early investment in the Romanian tech company UiPath, which became a unicorn following a $1.6 million seed investment in 2015. This year, the Digital East Fund will become independent and cut its ties with the Berlin-based Earlybird.

Australia’s Blackbird is in second place, while Hong Kong’s MindWorks Capital takes third. This highlights the growing global nature of the venture capital industry, with firms from all over the world competing for top positions. 

Professor Gottschalg commented, “Having a European VC at the top shows an important change in the global venture capital landscape. This shows the maturity of Europe’s startup ecosystem and the strength of its innovation-driven economy.”

Global competition grows

The 2023 ranking features a diverse list of VC firms from around the world, with companies from Australia, Austria, China, Denmark, Germany, Hong Kong and United Kingdom making it into the top 10. Notably, only one U.S. firm, Visionary Venture Fund, secured a spot in the top 10, highlighting the rising competitiveness of international players. This marks a significant shift from the 2022 ranking, which included six U.S. firms in the top 10 alongside just one European VC—SmartFin from Belgium.

“It’s striking that only one U.S.-based VC made it into the top 10” said Gottschalg. “This global diversification signals expanding opportunities for investors, particularly in emerging markets. It will be interesting to see how U.S. firms respond to this competitive challenge moving forward.”

The 2023 HEC Paris-Dow Jones Venture Capital Performance Ranking

European firms, such as Medicxi Ventures, based in the United Kingdom and specializing in life sciences, and Heartcore Capital, headquartered in Denmark, are demonstrating strong performance. This trend indicates the growing influence and confidence of European VCs in supporting their entrepreneurs. Gottschalg emphasized, “This is a very important moment for European venture capital, showing the strength of our innovation ecosystem and the rising global interest in European-led ventures.”

While technology and healthcare remain the primary areas for investment, Chinese VCs are making advancements in the consumer goods sector, signaling a shift toward diverse markets. “The success of Chinese firms in this area indicates that their investment strategies are evolving to meet global consumer needs,” said Gottschalg.

Although eight U.S. firms, including Visionary Venture Fund, NEXT Investors, and G Squared, are present in the top 20—ranking 8th, 11th, and 12th respectively—the overall ranking reflects a more balanced global investment landscape. Strong performances from firms in Europe, Asia, and Australia highlight the increasing competitiveness of the venture capital industry. “The competition is intensifying, and we anticipate even more innovation and high-growth ventures emerging from these diverse regions,” concluded Gottschalg.

Methodology 

The HEC Paris-Dow Jones Venture Capital Performance Ranking is an annual study conducted by Professor Oliver Gottschalg and his team at HEC Paris. It evaluates VC firms based on data sourced from Preqin and directly from private equity firms. The study assesses firms that raised over $100 million across all their venture capital funds between 2010 and 2019.