In 2023, private markets firm Riverside Europe acquired Dastex, a German clean‑room specialist. For Karsten Langer, managing partner at Riverside Europe, Dastex is one of firm’s strongest investments, underpinned by the macro trend of re‑shoring.
Strategic European industries such as semiconductor manufacturers are moving production from lower‑cost Asian bases back to Europe, says Langer, and this drives demand for “clean‑room” environments. Dastex supplies the wearables and cleaning products required for these highly sanitised manufacturing sites, used by sectors from electronics to automakers.
Founded in 1979, Dastex fitted Riverside Europe’s focus on medium‑sized companies, which Langer defines as companies with €25 million to €250 million in revenue. As more technology production shifted to countries such as Hungary and Portugal, says Langer, demand for clean‑room services throughout Europe rose.
With Riverside Europe’s backing, Dastex has since made six acquisitions, creating what Langer describes as a near‑unique European platform. “We had already identified the companies that would complement it. We could buy and build a leading player in a sector where one didn’t yet exist.”
“Europe has held its own”
Riverside Europe is part of US‑based The Riverside Company, and Langer spoke to Funds Europe on the sidelines of a conference and after a panel on macro conditions, ESG and fundraising. He argues that Donald Trump remains central to the macro picture, citing tariffs and the scale of European imports into the US. Technology, he adds, is an area where the US and Europe are mutually dependent.
European tech and data firms feature in Riverside Europe’s portfolio. Langer says Europe has many strong private companies emerging from their entrepreneurial phase and which are now seeking institutional capital to scale.
Re‑shoring feeds into the broader ‘European Autonomy’ theme, as the EU strengthens energy infrastructure and strategic supply chains. Langer sees US investors increasingly looking to diversify internationally, including into Europe. His message to those sceptical of Europe’s performance is that mid‑cap private equity returns over the past 15 years have matched – and at times exceeded – the US, with both regions in “15% rolling IRR” territory. Small‑caps, he adds, often grow faster than Europe’s large‑cap names.
Concerns about Trump’s impact on the rule of law and Federal Reserve independence are also prompting some US investors to seek safer havens abroad, including Europe.
Despite continued performance from private markets, investors are deploying capital more slowly. This is due to funds delaying exits from 2021‑vintage deals because valuations inflated during the post‑Covid surge, particularly in technology, and this means target returns are taking longer to achieve.
“Investment banks have highlighted that investors are considering a delay to exiting their 2021 vintage by two years. Investors are not investing money at the pace that their models predicted, not after Covid saw prices go very high, especially in technology.”
This slowdown of capital-deployment is at least eased by newer arrivals in private markets, such as private wealth channels.
ESG? It’s just good investments
Around half of Riverside Europe’s clients are US‑based, including a small number from Republican‑leaning states. While these investors may not champion ESG, Langer says they appreciate its economic logic. Riverside Europe requires portfolio companies to install solar panels once energy costs exceed a set threshold. “They like what we do economically. They’re not ideological – they just want good investments.”
Alternative energy remains one of Europe’s strongest private‑markets opportunities. Whatever the shifts in US sentiment, Langer says ESG will stay central to Europe’s agenda. “Trump can dig for more fossil fuels – but Europe can’t.”
Standing on its own
For Langer, the convergence of re‑shoring, European Autonomy, shifting US politics and a recalibrating investor base is playing to Europe’s strengths. Mid‑caps, often overshadowed by US mega‑caps, are demonstrating competitive performance and resilience. As investors reassess where long‑term value lies, he argues that Europe’s blend of industrial depth, entrepreneurial talent and strategic policy direction positions it not as a junior partner to the US, but as a market increasingly capable of standing firmly on its own.
