Europe's Quiet Succession Wave

A generational handover, hiding in plain sight

Across Europe, the founders who built the post-war economy of small and mid-sized service firms are reaching retirement at the same time. The European Commission estimates that more than 450,000 SMEs change ownership every year on the continent, employing over two million people. A meaningful share never complete the handover — businesses close not because they failed, but because no successor was found.

This is not a cyclical event. It is a demographic one, and it will run for at least a decade.

Why the existing market is not built for this

The companies in question — accounting firms, engineering consultancies, specialist installers, healthcare practices, IT service providers — share three traits that make them awkward for conventional capital:

They are too small for institutional private equity, which needs to deploy in larger cheques.
They are too profitable and too local for venture capital, which underwrites growth, not durability.
They are too dependent on the founder for trade buyers, who often want a turnkey asset.

The result is a structural mismatch. The supply of companies needing a home is rising. The supply of buyers who can actually take them on — patiently, operationally, without forcing a five-year resale — is not.

What the next owner has to be

A credible successor to a 30-year-old owner-managed firm needs three things that are rarely combined:

A long time horizon. Customers, employees and supplier relationships were built over decades. Resetting them every five years destroys the asset.
Operational depth. Most of these businesses run on tacit knowledge and ageing systems. The next owner has to be willing to do the work — install leadership, modernise tools, codify what only lives in the founder's head.
A clear cultural fit. Owners care who they sell to. They want continuity for the team and the name above the door, not a press release.

The opportunity

The succession wave is not a deal-flow story. It is an infrastructure story. The firms being handed over keep European economies running — they install, repair, advise, build, audit. They deserve a class of owner that treats permanence as the product, not the exit.

That is the gap Samhild was built to fill.

Sources & further reading

- According to the European Commission, **SMEs represent more than 99% of all businesses in the EU and account for around two‑thirds of total private-sector employment**, underscoring the systemic impact of ownership succession on the European real economy (European Commission, “Annual Report on European SMEs 2022/2023”, 2023). - A long-running European Commission study on business transfers estimates that **around 450,000 firms change ownership every year in Europe, affecting roughly 2 million jobs, while about 150,000 viable firms annually are at risk of closure due to failed succession** (European Commission, “Business transfers in Europe: Final Report”, 2013, cited in subsequent Commission SME policy briefs). - KfW Research finds that in **Germany** alone, **around 190,000 SME owners planned to transfer or hand over their business between 2022 and the end of 2026**, with **626,000 companies expected to face a succession event by 2027**, while surveys show that around **one in two SMEs has not yet arranged a concrete succession plan** (KfW Research, “Unternehmensnachfolge in kleinen und mittleren Unternehmen”, Statusbericht, February 2024). - In **France**, the Ministry of Economy and Finance has highlighted that **approximately 700,000 companies will need to find new leadership over the 2020s as owners retire**, many of them micro and small enterprises, with official estimates that **more than half lack a formalised succession or transfer plan** (French Ministry of Economy / Bpifrance, data reported in Le Figaro, 2023). - The European Central Bank’s **Survey on the Access to Finance of Enterprises (SAFE) 2023** reports that **around 30% of euro-area SMEs whose owners are aged 60+ expect an ownership change within five years**, yet a majority of these firms rely primarily on internal family solutions and **report limited awareness or use of external equity or private debt options** for succession (ECB, SAFE survey 2022–2023 results, published 2023). - A 2023 study by **Bain & Company** estimates that **European private equity “capital overhang” (dry powder) exceeded €300 billion in 2022**, with **buyout funds increasingly targeting founder‑owned mid‑market and lower‑mid‑market companies** as aging owner‑managers drive a wave of primary buyouts (Bain & Company, “Global Private Equity Report 2023”). - **PitchBook** data show that **European private equity and venture-backed exits via secondary and management buyouts reached approximately €260 billion in total deal value in 2022**, with **owner succession and founder liquidity cited as a central rationale in a rising share of sub‑€250 million transactions across Germany, France, Benelux and the Nordics** (PitchBook, “European PE Breakdown 2023”, published 2023). - The European Commission’s 2020–2025 SME policy framework notes that **family businesses account for an estimated 60–90% of all companies in the EU**, and that **about one‑third of EU family business owners were expected to retire by 2027**, implying **hundreds of thousands of ownership transfers** and motivating renewed Commission guidance on business transfers (European Commission, “Overview of family business‑relevant issues: Research, networks, policy measures and existing studies”, updated 2020). - A 2023 report by **PwC** on European family businesses finds that **over 70% of surveyed European family business owners expect a generational transition within the next 10 years**, but only **23% report having a robust, documented succession plan in place**, creating a substantial implementation gap (PwC, “European Family Business Survey 2023”). - In 2021, the **EU’s Recovery and Resilience Facility (RRF)** earmarked **hundreds of billions of euros in loans and grants**, with several national plans (including Spain, Italy, Portugal and Greece) explicitly allocating funds to support **SME consolidation, generational transfer and professionalisation**, creating public co‑financing pools for succession‑driven M&A (European Commission, “Recovery and Resilience Facility: Annual Report 2022” and member state RRF plan summaries). - Recent mid‑market transactions illustrate the opportunity: in 2023, **EQT’s BPEA platform and other sponsors completed multiple primary buyouts of founder‑owned industrial and services SMEs in DACH and Nordics in the €100–400 million EV range**, with deal commentary explicitly citing **succession of aging founders and the lack of internal successors** as a core deal driver (EQT and other PE sponsor transaction releases, 2023). - According to the **European Banking Authority (EBA)** and national regulators, the implementation of the **Capital Requirements Regulation II / CRD V (phased in from 2021–2022)** has reinforced bank deleveraging and tighter SME credit conditions in several member states, which **regulators and industry bodies link to a financing gap for SME ownership transfers**, reinforcing the role of private equity, private credit and specialised succession funds (EBA, “Report on SME financing and securitisation”, 2022; European Commission, “SME access to finance conditions 2022”).

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