PSG Equity has closed its third European fund at more than €4.4bn (£3.7bn), significantly exceeding the €2.6bn raised for its previous Europe-focused fund in 2023.
PSG Europe III reached its hard cap after attracting commitments from a range of investors, including state pension funds, sovereign wealth funds, insurance companies, family offices and high-net-worth individuals.
The fund will focus on European software and technology companies, with PSG aiming to support businesses as they scale into pan-European category leaders with global reach. The growth equity firm said it sees opportunities in businesses using artificial intelligence to develop enterprise software, as well as AI-native companies with differentiated technologies.
PSG said the new fund reflects its view that Europe is entering a new phase of software innovation, driven by AI adoption, demand for European technology providers and growing interest in digital sovereignty.
The firm’s European team was established in 2019 and now comprises 83 professionals, including investors and software and technology specialists. The team is headquartered in London, with an additional office in Paris.
PSG has made 43 platform investments across Europe to date, alongside 98 add-on acquisitions and 12 realisation events. Its recent European investments include AI company Mistral AI, BrightAnalytics, Aikido Security, Quality Hosting, Emotion Mobility, Namirial and Glasswall.
Peter Wilde, chairman of PSG, said: “We are delighted by the strong support PSGE III has received from both long-standing and new investors globally. This outcome underscores the strength of PSG’s global platform and our consistent, disciplined approach to creating value, with a focus on supporting high-growth software companies with the capital and operational resources needed to build enduring category leaders.”
Mark Hastings, chief executive officer of PSG, said: “It’s an exciting time to partner with leading software scale-ups in Europe. We see AI materially expanding the enterprise software opportunity, creating the next generation of category leaders while accelerating innovation across established software platforms.
“We are excited to continue to support AI-native businesses with differentiated technology and clear competitive advantages, while helping mission-critical systems of record and infrastructure harness AI to enhance their products, accelerate innovation and drive growth.”
