I am con昀椀dent that investors, in the light of the multi-layered crises we are facing, will realise that VC as an asset class is the single best hedge for their exposure to portfolios of companies with unsustainable business models. Uli Grabenwarter Deputy Director, Equity Investments & Guarantees, EIF What will make investors deploy capital? Human intelligence, I would hope. What is the alternative to deploying the accumulated capital now? To wait? Wait for what? Better entry valuations than today? Unlikely. Or lower interest rates that make VC relatively more “attrac- tive”? Institutional investors, pension funds, insurance companies, won’t meet their future payment obligations with single digit 昀椀xed income rates, without the returns that only venture will be able to generate. Or maybe wait for a more stable geopolitical environment? Dream on. Besides, as the investors community, we will have to real- ise that without us engaging at scale in the funding of innovation and technology, many of the business models that our today’s returns rely on will disappear. Europe’s unwavering sentiment Despite the backdrop of almost two years of challenging macro conditions, as well as the persistent noise from negative events such as down rounds, write-offs, and reduced investment volumes, sentiment on the future prospects of the European tech ecosystem have stabilised. In fact, only 23% of respondents are less optimistic than they were a year ago. By comparison, almost two times the number of respondents (45%) stated that they are more optimistic today compared to 12 months ago. Looking across respondent types, the state of industry sentiment is broadly aligned across all stakeholder groups. On the investor side, responses from angels, VCs and LPs all showed remarkably similar perspectives. While on the tech company side, founders and C-level executives showed slightly less positive sentiment overall in comparison to their department heads and employees. | 30