Greg Schmitt
Head of Private Equity & Co-Investments
Sessions (2)
Sessions featuring Greg Schmitt at Bits & Pretzels 2026 | Founders Festival in Munich
Where LPs Actually Put Their Money
Greg Schmitt’s core message was that LP capital in venture is becoming more selective, more concentrated, and more dependent on access to the very best managers. Speaking from the perspective of MEAG, the asset manager of Munich Re, he framed the session as a shift away from how VCs invest in startups and toward the question of “which funds really get funded.” MEAG has invested in venture for more than twenty years on behalf of insurance clients, and Schmitt used that long-term LP perspective to explain how today’s fundraising environment is being reshaped by concentration at both the deal level and the fund level. He first highlighted that the total amount of capital raised across the VC ecosystem has decreased, while the share going to the 30 largest brands has increased massively. He connected this to the rise of very large companies and models, citing names such as Anthropic, SpaceX, and xAI as examples of businesses attracting significant capital, which in turn pushes the firms backing them to raise much larger funds. He compared this with buyout fund history, noting that when he started in the industry fifteen years ago, a buyout fund of size would have been significantly smaller than $15 billion, whereas some venture firms are now raising at that scale. Schmitt then turned to performance, arguing that average venture returns are not good enough from an LP perspective. He showed twenty-year trailing IRRs for U.S. venture capital, where the best funds reached 19.7% IRR while the median was around 10%. He compared that with a 13% average for buyout funds over the same reference period, emphasizing that LPs with the ability to allocate across venture, buyout, growth, and other segments must justify the additional risk and dispersion of venture. Selection, in his view, is central: LPs must find managers who can attract the strongest founders, because venture’s upside is concentrated in the best-performing funds. The later part of the talk focused on liquidity, European value capture, and current investment themes. Schmitt challenged the idea that venture funds are truly ten-year vehicles, pointing to DPI figures such as 1.3 for 2010 vintage funds after ten years and 0.7 for 2015 vintage funds today. Still, he argued that tremendous value is coming and expects DPI to rise significantly this year and next year. In Europe, he noted that more European GPs are now backing top private European companies than in past top exits. He closed by describing MEAG’s approach: build long-term GP relationships, remain stage- and geography-agnostic, seek global best managers, and watch themes including liquidity, concentration, the underserved middle, secondaries, European initiatives such as KfW, and defense technology exposure, which he said is almost entirely venture and almost entirely U.S. in MEAG’s portfolio.
“The best managers, they pick their LPs. So why would they pick you?”
Europe vs US: Where Do Funds Really Generate Alpha?
The core message of the provided transcript is that Europe’s venture ecosystem has materially improved, but the route to capturing alpha remains contested: should European founders and LPs rely on local European managers, or partner with US platforms that bring scale, exit experience, and transatlantic access? The moderator frames the debate around whether US and European funds are producing comparable alpha, with a few outliers driving much of the return. Greg opens from the institutional LP perspective, noting that his program was built mostly toward the US over the last twenty years and has generated “tremendous returns,” while Europe has been catching up in average performance. The central question becomes whether investors are missing European value, and if so whether that value is best accessed through US platforms or local funds. Alex then grounds the discussion in valuation data and exit markets. He says European Series B pre-money valuations are about 44% to 45% below US median levels, while emphasizing that this is a structural market difference rather than proof that US companies are better. He links higher US valuations to faster scaling in a less fragmented market and, more importantly, to exit opportunities, arguing that NASDAQ IPO valuations can justify higher entry prices. Philippe adds that the median gap does not apply to Europe’s top companies: elite founders such as Lovable, Synthesia, and ElevenLabs raise at similar valuations to US peers. He argues that US funds have moved earlier in Europe because they now see comparable talent, ambition, and potential to build global category leaders, while also stressing that local European presence is a major competitive advantage. Hendrik challenges the idea that the best European seed deals now overwhelmingly choose US funds, arguing that more European entrepreneurs are choosing European leads because of resilience, serenity, and a desire to avoid being pulled too heavily toward the US. He cites a recent growth funding case where a European tech team accepted a term sheet one-third below US offers because they wanted most of the funding to remain European. This leads into a sovereignty discussion, especially around defense and AI, where Greg notes that European defense founders may increasingly care not only about their GP’s location but also about where that GP’s capital comes from. The Stark example is used to illustrate how US investors on cap tables may create future tension when contracts are with European governments. Philippe argues for a partnership model rather than a binary choice. He criticizes US funds that do many European seed deals without meaningful follow-on support, saying this inflates seed prices and creates negative signaling for unfunded companies. NEA’s stated approach is to leave pre-seed and seed opportunities largely to European managers, then partner at Series A when elite founders want access to scale, Fortune 500 distribution, US listings, and international expansion. Alex closes the provided portion by saying public investors like KfW should not replace private capital but invite it, and that foreign capital should not be condemned because US investor interest is evidence that Europe has become an attractive market. Philippe reinforces the economic stakes by citing US venture capital’s disproportionate contribution to GDP growth, public market capitalization, and hiring, arguing that replicating even part of that innovation economy in Europe would be significant.