EQT's growth capital arm has held a final close of its first dedicated fund, raising €2.4 billion (about $2.4 billion) in total commitments as the firm looks to plug Europe's growth-stage funding gap.

The vehicle—which is one of the largest European growth funds to date, according to PitchBook data—will target European and Israeli tech companies in sectors such as enterprise, consumer, health and climate. The fund includes €2.2 billion in fee-generating assets under management, along with €200 million in additional capital; typical investments will range from €50 million to €200 million.

The fund is already nearly one-third deployed, having made seven bets on growth-stage companies. Lithuanian second-hand goods marketplace Vinted and cloud banking platform Mambu are among its investments.

Europe’s venture ecosystem has grown significantly in the past few years, but the continent still suffers from a lack of domestic growth capital, with tech companies often relying on growth-stage investments from overseas. According to EQT, Europe-based firms made up only 30% of all investors in growth-stage rounds last year. With the downturn still in full swing, growth capital will be harder to come by for many companies.

More European investors have taken note of the funding gap and the strategy appears to be gaining more traction. In H1, 15 growth vehicles closed worth an aggregate €8 billion, representing 38% and 29% of the continent’s total fund count and value, respectively, in that period, according to data from our Q2 2022 European PE Breakdown. In 2021, growth funds accounted for 27% of the overall number and 17% of capital raised.

Other growth funds closed this year include Summa Equity’s €2.3 billion vehicle, which was announced in January. In the same month, InfraVia Capital Partners closed its fund on €501 million, while Generation Investment Management raised its largest growth equity vehicle in May totaling $1.7 billion.

Feature image via T. Schneider/Shutterstock

This article originally appeared on PitchBook News