PSG Equity raises €4.4B for new European tech fund

PSG Equity has raised €4.4 billion for its third European fund, the largest vehicle the Boston-based firm has ever assembled for the continent. To put the trajectory in perspective: PSG’s first Europe fund closed at just over €1.3 billion in January 2021. Its second came in at over €2.6 billion in November 2023. This third fund roughly doubles that again. Who is writing the checks The Pennsylvania State Employees’ Retirement System, known as PennSERS, recommended a €100 million commitment to the Europe III fund in May 2026. Around $100 billion is currently being directed toward software opportunities globally, and Europe is claiming a growing share of that capital. PSG’s pitch to LPs rests on a track record the firm describes as above-first-quartile performance relative to peers, with below-median loss ratios. The strategy: buy small, build large PSG’s playbook centers on a buy-and-build approach. The firm identifies emerging software companies with a single product and a single market, then scales them into multi-product, multi-country platforms through a combination of organic growth and add-on acquisitions. Germany has been a particular focus. PSG completed seven platform invest...