Venture capital trends from the U.S. are once again influencing European markets, with strip sales becoming the latest secondary transaction gaining traction among European VCs firms. Unlike direct secondaries or continuation funds, strip sales involve selling stakes in a bundle of portfolio companies, offering a new liquidity path in an environment where traditional exits remain scarce.
“We’re seeing it arrive faster than expected,” says Joe Schorge, managing partner at UK-based Isomer Capital. He notes that several European investors are now actively exploring strip sales as a way to unlock capital.
In Germany, Simon Schachinger, a VC-specialized lawyer at Orbit in Berlin, confirms that strip sales are under serious discussion. “We’ve seen several managers begin approaching placement agents to test market appetite,” he says, although none of these deals have officially closed yet.
Strip sales aren’t brand new — they’ve been on the radar for some time. Jonathan Graham, previously with Asante Capital, noted last year that European VCs were eyeing the model. However, over the past six months, momentum has clearly accelerated. A placement agent working with general partners says they’ve pitched strip sales for eight different European VC funds recently. “It’s becoming more prevalent,” the agent adds.
European VCs Secondaries Hit an Inflection Point
The growing appeal of strip sales aligns with a broader surge in secondary activity. Ravi Viswanathan, founder of NewView Capital, observes that VC interest in secondaries has “passed an inflection point” over the last six months. His firm recently held two secondaries-focused events in London, highlighting strong interest from European investors.
“Some European VCs are already quite advanced in managing liquidity proactively,” he says, predicting more firms will adopt active strategies like strip sales.
What Are Strip Sales?
Strip sales differ from direct secondaries by bundling small stakes from multiple portfolio companies — typically 9 or 10 — and selling them in a single package. The strategy can represent a slice of the whole portfolio. The key motivation: boosting DPI (Distributed to Paid-In Capital), a critical metric used to demonstrate returns to LPs during fundraising.
With IPOs delayed and M&A activity slow, strip sales offer a practical, if imperfect, route to return capital. “The reason more European venture managers are using this tool is simple — there’s nowhere else to go,” says the placement agent.
Current deals usually see a 20–30% discount, with recent tariff uncertainties potentially widening that gap. For fund managers, strip sales also provide a chance to crystallize carry, or their share of profits, which can be hard to realize in a liquidity-starved market.
Buyer Appeal and Legal Challenges
From the buyer’s side, strip sales provide access to de-risked, proven portfolios without the heavy involvement early-stage investing typically requires. “You can still double or triple your portfolio,” Schachinger says, “without needing deep board involvement or ongoing deal sourcing.”
The buyers exploring these transactions include major institutional players such as HarbourVest, Hamilton Lane, Goldman Sachs, BlackRock, and Blackstone — firms more familiar with acquiring LP stakes but now venturing into GP-led strip sales.
Yet, the deals are far from straightforward. Legal and operational complexities can stall or derail them. Strip sales may be restricted by shareholder agreements, including tag-along, drag-along, or right-of-first-refusal clauses. These terms often limit a VC’s ability to unilaterally sell stakes to outside parties.
“You need to conduct legal due diligence early in the process to determine if such a transaction is even viable,” Schachinger warns.
Strip sales can also put LPs in a bind. “It’s a catch-22,” the placement agent explains. “LPs want distributions, but accepting a discounted exit can be hard to swallow.”
Still, the reality of delayed IPOs and unpredictable geopolitical shifts makes strip sales one of the few remaining tools for liquidity. Despite hurdles, activity is expected to rise in 2025.
“There will be more strip sales this year than last,” the agent predicts.
