Karey Barker, Founder and Managing Director of Cross Creek, shares a candid perspective on how U.S.-based LPs evaluate European VC funds—and what they’re really looking for.
With nearly 20 years of experience and roots in public market investing, Cross Creek has evolved into a disciplined fund of funds platform, backing both established and emerging venture managers. While the majority of its portfolio remains U.S.-focused, Barker says interest in Europe is rising—but not without conditions.
Sector expertise: “If you’re a smaller fund, you need to be focused,” Barker said. LPs favor managers with deep domain knowledge—whether in fintech, cybersecurity, or biotech.
Local presence: Cross Creek looks for GPs with teams embedded in the markets they invest in. Access to high-quality deal flow often depends on local knowledge and networks.
Fund size discipline: The firm prefers funds in the $200–$500M range—big enough for scale, small enough to stay agile. “Our favorite funds could raise billions, but choose not to.”
Long-term performance: Track record remains essential. Spinouts from established firms are more attractive than unproven first-time teams.
Fragmented regulation: Cross Creek is cautious about how local regulations and government capital mandates can limit a GP’s geographic flexibility and operating efficiency.
Overstretched geography: European VCs often call themselves “pan-European,” but LPs like Cross Creek scrutinize whether firms truly have the team and infrastructure to execute across regions.
Limited liquidity: With IPOs still scarce, LPs want to see managers building real value—not just chasing inflated valuations.
Ultimately, Barker stressed that European VC is 90% the same as the U.S.—but the last 10% matters. That includes understanding regulation, capital restrictions, and market access. For GPs hoping to attract international LPs, clarity, focus, and transparency are non-negotiable.
As private equity adapts to a prolonged high-cost environment, investors are being forced to rethink how they source deals, create value, and deploy capital. Ahead of her appearance at 0100 Europe (April 21–23), we spoke with Geraldine O’Keeffe, Partner at EQT Healthcare Growth, about how one of Europe’s leading investment platforms is transiting today’s market dynamics—across healthcare, technology, and beyond.
