Crossing the Atlantic: How US fund managers are strategically rethinking European fundraising

Steady trends in a turbulent world

Since around 2020, we have seen a clear increase in US GPs exploring European fundraising. Following the pandemic-era disruption, many managers doubled down on strategic planning, strengthened their internal teams and turned their attention to under-allocated European LPs.

We’ve also seen a parallel rise in activity among managers from other key fund markets, Canada and Singapore in particular, many of whom increasingly view Europe not just as a market of interest, but as a core part of their long-term fundraising strategy.

This shift has been driven by the underlying strength of the private equity market. Many of the managers we work with, particularly top performers, have seen successive fund growth, with increases of more than 50% in commitments not unusual. Their expansion into Europe reflects this success, not stress. Fundraising in the region is increasingly a logical next step for scaled, well-positioned managers seeking to diversify their LP base and deepen institutional access.

Today, against a backdrop of elevated uncertainty, we see a similar pattern unfolding. Managers are pausing, reassessing and preparing for the next phase of growth. They are not waiting passively; they are laying the foundations – refining strategies, developing Europe-compatible products and setting the stage for when the floodgates reopen.

The number of non-EU funds we service raising capital by National Private Placement Regimes (NPPR), one key route into Europe, has risen by 250% since 2020, with total AUM increasing from €123 billion to €499 billion1.

Europe, with its stable environment and deep institutional capital pool, offers an increasingly attractive opportunity.

Strategic Shifts

Historically, North American managers often admitted European LPs via reverse solicitation – a light-touch, opportunistic route. This trend is now evolving.

Over the past five years, we have observed a steady shift:

• First step: reverse solicitation or minimal NPPR registrations
• Next step: more deliberate NPPR marketing in select jurisdictions, such as the UK, Netherlands and Luxembourg
• Intermediate step: more complex NPPR registrations requiring depositary oversight, notably in Denmark and Germany
• Longer-term move: establishing an EU-domiciled vehicle, typically in Luxembourg, to achieve broader, pan-European access.

Whilst NPPR remains the dominant route, particularly for mid-market managers, interest in EU structures such as Luxembourg funds is clearly gaining momentum.

It is important to emphasise: most US managers are still at earlier stages of this journey. Luxembourg is a powerful option, but not an immediate necessity for everyone. It becomes relevant as a manager’s European LP base grows, typically crossing a threshold of 15–20% of commitments.

Luxembourg: growing importance for a long-term play

Luxembourg has emerged as the default choice for US GPs establishing an EU-domiciled presence. The rationale is clear: pan-European access, operational familiarity for LPs and long-term fundraising flexibility.

Yet moving to Luxembourg is rarely a first step:

• Today, approximately 15% of North American GPs with over $1 billion in AUM who raise capital in Europe do so via a Luxembourg structure.
• Adoption typically increases as European capital becomes more material across fundraising cycles, with managers returning to the region fund after fund and building deeper LP relationships.
• Looking ahead, we expect the proportion of managers using Luxembourg to rise significantly, but as part of a multi-cycle, evolutionary trend, not an overnight shift.

For many managers, initial European structures set the foundation for broader use, not just for flagship private equity funds, but also for credit, real assets and other strategies.

Of the top 20 global private equity funds raised since 2022, 12 have used Luxembourg-domiciled vehicles – many for the first time. Among this group, those using a Luxembourg parallel structure for the first time saw a median fund size increase of 36%, compared with 19% for those who did not2. This is not causation, but it reinforces a simple truth: European investors increasingly back managers who make access simple, familiar and operationally robust.

For many managers, success with an initial Luxembourg structure sets the stage for larger, more ambitious fundraising. Once they meet their minimum fundraising threshold and build a track record, they often return with a materially larger second fund. This follow-on raise tends to benefit from stronger LP recognition and smoother execution, reinforcing the long-term value of engaging early and incrementally.

At Langham Hall, we help managers navigate this timeline thoughtfully, ensuring that each strategic step, from NPPR to depositary appointment to full EU structuring, is commercially justified, operationally ready and future-proofed.

Preparing for periods of uncertainty

If the past five-plus years are a guide, uncertainty prompts not paralysis but preparation.

Periods of volatility typically see managers:

• Pausing momentarily to reassess strategies
• Planning carefully to align with new market realities
• Acting decisively when conditions stabilise.

During the pandemic, we observed that managers who used periods of uncertainty to refine their internal capabilities, deepen investor engagement and position themselves internationally emerged stronger and more competitive.

Today, we see a similar dynamic at play. Managers are actively preparing: strengthening investor networks, understanding EU marketing regulations and exploring operational readiness for European fundraising.

Short-term hesitation is natural, but the long-term strategic imperative – to diversify capital sources and build resilient, globally aligned businesses – remains unchanged.

One particularly effective early step is engaging in hosted pre-marketing. This allows managers to gauge appetite from EU investors before committing to a full regulatory pathway, providing a valuable line of sight into whether NPPR or a Luxembourg-domiciled structure will be the most effective route.

The road ahead

In an environment where uncertainty has a significant impact, Europe offers US managers an additional stable and strategic source of capital.

The journey is not linear. For many, it will involve reverse solicitation, then NPPR registrations and depositary arrangements, and only over time – as European capital grows in importance – the transition to Luxembourg structures.

However a manager chooses to navigate it, the opportunity is substantial. Thoughtful, early engagement with European investors today lays the foundation for scalable, resilient growth tomorrow.

At Langham Hall, we bring clarity to complexity. We have supported more than 200 non-EU managers across private equity, credit and infrastructure on their European fundraising journeys. We offer practical insights into how the market is evolving and provide strategic guidance tailored to your needs. Our services help managers move confidently – not just into Europe, but into the future.

1 According to Langham Hall’s own regulatory filing data (annex IV): 2019-2024.
2 According to our analysis of the CSSF register of AIFs