More than 20 of the UK’s leading UK venture capital funds, a group that manages more than £25bn between them, have signed an agreement designed to boost investment in high growth companies across Britain.
The voluntary signatories of the Venture Capital Investment Compact include LocalGlobe, Amadeus Capital, Balderton Capital, IQ Capital, Cambridge Innovation Capital, Oxford Science Enterprises, Albion, Molten, Octopus, BGF, Frog Capital, Epidarex, Abingworth, Notion, MMC, Lakestar, SV Health Investors, Beringea, Northern Gritstone and NorthEdge.
Their aim is to strengthen partnership between venture capital funds and the pensions industry by channelling more pension funds into private startups. Having laid out his plans to make pension funds allocate 5% of their capital to unlisted equities before 2030 earlier in the year, Chancellor Jeremy Hunt has already underwritten the initiative as a “huge win” for the country saying:
“This compact is a huge win - demonstrating that our world-renowned venture capital firms stand ready to help our pension providers allocate funding to our high growth companies.”
As part of the Compact the funds will work with pension funds to identify and create more attractive investment opportunities in the private market whilst taking full advantage of pension reforms announced by Mr Hunt earlier this summer.
The British Private Equity and Venture Capital Association (BVCA) who have been instrumental in driving the Compact hopes this formal framework will persuade pension funds to become limited liability partners in the funds they manage and advise. Michael Moore, chief executive of BVCA, is excited about the new opportunities the Compact will deliver:
“Many overseas investors have jumped at the chance to invest in - and benefit from - the performance of innovative UK firms. UK savers must have access to the same opportunity.”
As a firm that specialises in the commercialisation of innovation and works closely with both start-ups and scale up and investors, we are excited to see the impact the Venture Capital Investment Compact has on Britain’s high growth and high potential companies.
As we work with innovators and entrepreneurs on a daily basis, we know there are no shortage of new ideas in the UK. However, too many are struggling to bloom because it is so difficult to secure the required funding. We trust the formation of the Venture Capital Investment Compact will make more funding available.