Table of Contents
- 1.Foreword
- 2.Round-up of Nordic private equity in 2022
- 3.Interview: Verdane’s Frida Einarson
- 4.
- VC & Growth deals: High level of activity continued in 2022
- Seven of the ten largest deals involve tech companies
- ICT remains the most attractive sector for VC and growth funds
- Growth in industrials
- Health care and life science attracted less attention from investors, compared to the pandemic years
- Uncertainty spread in the second half of the year
- The Norwegian market experiences growth
- Fewer non-Nordic GPs, but more deals by Norwegian GPs
- 5.
- 6.
- 7.
- Buyout deals: A game of two halves
- Among the largest deals were six deals involving ICT companies
- Success with a flexible approach in uncertain times
- Reduced investments across all major sectors
- Navigating market turbulence: Unrest can bring new investment opportunities
- Buyout deals decreasing across the Nordics
- Fewer international investors in the Nordics
- 8.Backed by PE: No Dig Alliance
- 9.
- 10.
- 11.Entry multiples: Prices continue to rise despite geopolitical unrest
- 12.
- 13.
1. Foreword
2022 will go down in history as the year we again experienced war in Europe. None of us are unaffected by the suffering of the Ukrainians, and our hearts and thoughts go out to them during these continuously challenging times.
Reinforced by the war, uncertainty has once again become prevalent, both for many households throughout Europe and in the financial market. Although the pandemic has created some degree of instability in the financial markets in recent years, 2022 saw an even more dramatic shift. High inflation, the greater cost of vital raw materials and rising interest rates are all factors that contribute to greater uncertainty and more demanding times ahead.
Looking back at the previous year, we cannot forget about the situation in the year before that, as 2021 was a truly remarkable year in the Nordic private markets. We saw a catch-up effect after the pandemic, causing record-breaking deals, exits and IPOs. The situation for 2022 looks different, but the activity level was still high compared to previous years, both within the venture and the buyout segments, as this report shows. Looking more closely at the data, we see a significant difference in the level of activity between the first half of the year and the second half. It seems that the uncertainty became more prevalent in the latter part of 2022.
Fundraising activity was high in 2022, with a record-high amount raised in both the buyout and the venture segments. Several large funds closed, which contributed to the high amount of funds raised. The buyout segment was dominated by a few large cap funds. The venture segment experienced high activity, in terms of both many funds with closings and a couple of large funds.
The exit activity, however, has been moderate, to say the least. We have never registered such a low number of exits in the Nordic market since we started our analysis in 2008, neither for venture exits or buyout exits. This can partly be explained by the record number of listings and exits in 2021. For instance, it is not surprising that we saw a lower number of PE-backed IPOs in 2022, as many of the companies that were ready for exit and listing had been taken out in 2021.
This report will provide you with a better understanding of how the year 2022 was in the Nordic private equity market. We have also interviewed Equip’s portfolio company,
No Dig Alliance, which gives a great understanding of how PE (private equity) funds can back companies in many ways. No Dig Alliance is also a splendid example of a company owned by a PE fund that is brining the world forwards – with innovative solutions and less carbon emissions.
What the future will hold is hard to predict, but I passionately believe that we in the PE industry – both as investors and as fund managers – must take our share of the responsibility for the creation of solutions for the climate crisis. Verdane’s new impact fund, Idun I, aims to make the world a better place, and you can read more about that in our interview with Frida Einarson, who is a Partner at Verdane.
I am convinced that we will also see more diversity within the industry in the coming years. More women are taking important seats within the industry – and they are in high demand, as increased numbers of companies see the importance of diverse teams and more equality.
We might see more challenging markets ahead of us, but, having worked for more than 20 years within private equity, it is my belief that, even in uncertain times, the private equity model and active ownership have shown to be well-equipped to handle uncertainty and challenging markets.
A special thanks to the GPs (General Partners) who have contributed to this report with their knowledge and insight – Ingrid Teigland Akay at Hadean Ventures, Frida Einarson at Verdane, Fredrik Korterud and Rebecca Farr at Norvestor, and Torkild Hebbert Haukaas at Equip.
Espen Langeland
CEO, Argentum