The Succession Gap: Europe's Quiet Transfer of Ownership

The numbers are quietly dramatic. Hundreds of thousands of European small and medium-sized businesses are expected to change hands over the coming decade, and surveys consistently show that a large proportion of owners have made no formal succession plan. Children pursue other careers. Management teams lack the capital or the appetite. The trade buyers who might once have consolidated the sector are focused elsewhere.

What is actually at stake

When succession fails, the business rarely fails loudly. It fades: underinvestment through the final years, key staff leaving as uncertainty grows, and eventually a closure or a distressed sale that erases decades of accumulated know-how, supplier relationships, and skilled employment. The loss lands hardest in the smaller cities and towns where these firms are often the anchor employer.

This is the context in which we operate, and it shapes how we behave. A founder choosing a buyer for their life’s work is not running an auction for a financial asset. They are choosing a custodian — for their people, their name, and their standing in a community they will continue to live in.

Succession as an investment strategy

We believe the succession gap is the most attractive opportunity in European private markets, precisely because it is not primarily a financial problem. The businesses are sound. The prices are sensible. What is scarce is a buyer who can genuinely take over: provide continuity for the team, professionalise operations gradually, and hold the company for the long term rather than repackaging it for the next transaction.

Done well, succession investing aligns everyone: the founder exits with their legacy intact, employees gain an owner investing in the future, and the buyer acquires a durable business at a fair price. It is rare, in any market, for the right thing and the profitable thing to overlap so completely.