Continuation vehicles have moved from a niche liquidity tool to a core feature of the European private equity landscape. A continuation vehicle is a secondary transaction structure that allows a GP to transfer one or more portfolio companies into a new fund while providing existing investors with either liquidity or the option to reinvest. With an estimated €19.8 billion raised through European continuation vehicles in 2025, GPs are increasingly using these structures to retain high-quality assets and provide liquidity to existing investors.
However, a paradox is emerging. Continuation vehicles are growing rapidly, but a significant proportion of LP capital is exiting rather than rolling into the new structure. Industry estimates suggest that 80–90% of LPs elect to sell in many continuation vehicle processes. The immediate assumption is often that investors are rejecting the asset or questioning the valuation. The evidence suggests something different.
For European managers, the more pressing issue may be operational execution.
Why Europe Faces Greater Scrutiny
European continuation vehicles operate in an environment of heightened governance, cross-border regulatory complexity and increasingly sophisticated LP oversight. According to our recent survey, 35% of managers identify valuation conflicts as the most challenging aspect of continuation vehicles, while another 27% point to the difficulty of balancing competing LP interests.
At the same time, 45% of European managers say consolidation is their primary growth strategy, reflecting the scale and operational sophistication now required to compete effectively in secondaries.
The result is that LPs are examining continuation vehicle processes with greater intensity than in earlier years. Independent valuations and fairness opinions have become standard practice, but investors increasingly want evidence of a robust bidding process, clear rationale and sufficient time to conduct their own underwriting.
When Time Becomes the Biggest Constraint
The most overlooked obstacle in continuation vehicles is often the timeline.
Most institutional LPs treat a continuation vehicle as a new investment decision. That means reviewing updated value creation plans, assessing revised legal terms, conducting compliance checks and securing internal investment committee approval. Many continuation vehicle processes provide LPs with only a few weeks, and sometimes as little as 20 days to complete this work. For large institutional investors, that window can be extraordinarily difficult to navigate.
As a result, operational constraints frequently become the deciding factor. LPs may choose the sell option not because they dislike the asset, but because they cannot complete their internal approval process within the allotted timeframe.
Investors are exiting because of process friction rather than investment conviction, the GP may be providing liquidity while simultaneously weakening long-term capital retention.
Three Operational Fixes
European managers looking to improve roll participation should focus on three areas.
-
Front-load the complexity
Operational work begins well before a transaction launches. Documentation, tax analysis, performance baseline adjustments and legal coordination should be completed as early as possible so LPs receive a more decision-ready package.
-
Replace static data rooms with interactive LP portals
Static repositories create bottlenecks. Integrated investor portals that combine transaction documents, scenario analysis, Q&A workflows and reporting can materially improve transparency and reduce the administrative burden on both GPs and LPs.
-
Automate look-through analytics
LPs increasingly expect detailed exposure analysis and forward-looking modeling. Automated look-through reporting enables managers to deliver this information quickly and consistently, particularly in multi-asset continuation vehicles.
The Real Competitive Advantage
Continuation vehicles are entering a second generation characterized by greater structural sophistication, larger transaction sizes and more demanding investor expectations. In that environment, the operational experience becomes a strategic differentiator. Managers that can provide transparency, compress administrative friction and support LP decision-making are likely to retain more capital within their ecosystem rather than seeing it migrate to competing platforms.
For European GPs, the challenge is engineering a process that allows investors to make a confident roll decision before the clock runs out.
Read the full report to learn more about the operational challenges of European continuation vehicles.
