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VC firms back UK pension investment initiative

Jeremy Hunt VC pension fund
Image credit: Kirsty O'Connor/HM Treasury

LocalGlobe, Amadeus Capital and Balderton Capital are among 20 signatories of the government’s Venture Capital Investment Compact, which aims to channel more pension funds into private startups.

It follows plans laid out earlier this year by Chancellor Jeremy Hunt for pension funds to allocate 5% of their capital to unlisted equities before 2030.

All of the Venture Capital Investment Compact signatories “voluntarily commit” to bringing on pension funds to invest in their funds as limited partners and partnerships with them.

The compact was organised by the British Private Equity and Venture Capital Association (BVCA), an industry body representing more than 650 firms.

“Many overseas investors have jumped at the chance to invest in – and benefit from – the performance of innovative UK firms,” said Michael Moore, chief executive of BVCA. “UK savers must have access to the same opportunity.”

The 20 venture capital and growth equity firms represent more than £25bn in assets under management in over 1,800 companies.

“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,” said Hunt. “This could boost British pension pots to the tune of £1,000.”

A “Pensions and Private Capital Expert Panel” has also been created to steer the implementation of the compact ahead of the Pensions Capital Deployment Summit next year.

Other signatories are 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.

Read more: Mansion House reforms: UK tech welcomes £75bn startup pension boost