Defence, AI, Decarbonisation: Europe’s Next Wave of Growth Is Here
Written by Aija Bärlund
Yesterday, I attended the 35th anniversary summit of the Finnish Venture Capital Association, where a keynote by Elias Korosis, Global Investment Partner at Federated Hermes GPE, offered a thought-provoking new perspective on Europe.
When discussing the European economy, the conversation easily gets stuck on short-term GDP figures, political instability, or comparisons with the AI powerhouses of the United States. Elias Korosis’ keynote, “Europe’s Moments,” reminded us that this is the wrong framework. Europe should be viewed through a longer-term lens – and when we do, the picture changes significantly.
The returns speak for themselves – if we take the time to listen
One of the keynote’s key observations was: European private markets investing delivers strong returns. The figures from the past ten years tell a clear story: large-cap PE 15%, mid-market PE 17% and European VC 17% – compared with 14% in the United States.
Yet many institutional investors remain underallocated to Europe. Korosis described this as “LP laziness”: investors make broad assumptions about regions without conducting sufficiently deep analysis, leaving billions of euros worth of opportunities untapped. This is also connected to what he called the “Hollywood Gap” – the distorted perception of Europe as primarily a holiday destination rather than a world-class investment environment.
Three themes that will shape the next decade
In the spirit of the Draghi Report, Korosis highlighted three strategic challenges – and opportunities:
Defence. Europe needs increased investment and its own resilient supply chains. This is not only a geopolitical issue – it is a significant investment theme in which the Nordic countries have an important role to play.
Digital competition and AI. Europe is not competing with the United States or China on the same terms – and it does not have to. Specialisation in responsible AI and data governance could become a European competitive advantage. The Nordic region could aim to become the “Switzerland of data” – a trusted and neutral infrastructure for the global data economy.
Decarbonisation. The European investment environment keeps companies more firmly committed to ESG themes than many other markets. This is not a burden – it can be a long-term competitive advantage.
What does this mean for us?
From a Finnish and Nordic perspective, the message is encouraging. Fintech, cleantech and data infrastructure are areas where we have strong expertise and a track record. International interest in Europe – particularly from Asia – is growing.
Yet the most important message of the keynote was not about data or return figures. It was about mindset and talent.
Europe should not be something we need to defend – we need to know how to sell it.
Europe is stable, strong and open for business. For the long-term investors – and for the leaders – that is a very good starting point.
The blog is based on my notes from Elias Korosis’ keynote presentation.
Aija Bärlund|Partner|aija.barlund@chief.fi| +358 40 681 0245
