Venture Capital: Top Drawer UK VC Firms Pledge To Help The Pension Industry Invest In High Growth Companies

October 24, 2023 | News, Venture Capital

The UK VC firms “compact” will capitalize on pension reforms announced by Chancellor Jeremy Hunt earlier.

A coalition of prominent UK VC firms, managing over £25 billion, has inked an agreement supported by Chancellor Jeremy Hunt, with the aim of boosting investments in high-growth companies across the nation. This initiative, part of a government-led effort to stimulate private investment in the UK prior to the chancellor’s autumn statement, has been dubbed a “huge win” for the country by Hunt. Notable signatories to this venture capital investment compact include SV Health Investors, led by former vaccines taskforce head Kate Bingham, and Northern Gritstone, chaired by former Goldman Sachs chief economist Jim O’Neill.

The “venture capital investment compact,” a voluntary commitment, seeks to strengthen the partnership between venture capital funds and the pensions industry, ultimately increasing investments in rapidly growing UK businesses. Chancellor Hunt stressed that this compact demonstrates the readiness of UK’s renowned venture capital firms to support pension providers in funding high-growth companies. Under this industry-driven initiative, firms will collaborate with pension funds to identify and create more appealing investment opportunities in the private market, capitalizing on pension reforms announced by Hunt earlier. (The Guardian)

The British Private Equity and Venture Capital Association, the driving force behind this compact, hopes to encourage pension funds to become limited partners in funds they manage and advise. The Treasury will host a roundtable to mark the compact, part of the chancellor’s Mansion House reforms to unlock significant investments from the UK pensions industry for fast-growing companies. This initiative aligns with broader plans to boost investments in homegrown tech and life sciences firms, positioning the UK as a competitor to Silicon Valley. Despite consistent underperformance in private investment compared to other G7 countries, the UK is taking steps to improve its position.

The announcement follows a separate roundtable with infrastructure investors, with discussions focused on opportunities and challenges. Chancellor Hunt is expected to address the venture capital compact during a pensions summit hosted by the City of London.

Related Story: UK Establishes New £1B Fund To Maintain Fintech Lead And Provide Growth Capital To UK Startups

Image Credit: Flickr

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