March 12, 2024

Ada Ventures closes £63m second fund to back diverse founders

The fund will back 10-12 early-stage UK startups each year

Sadia Nowshin

2 min read

London-based VC Ada Ventures has announced a final close of its second, £63m fund, which will back early-stage startups across the UK with a focus on diverse founders. 

The firm will write cheques of between £250k and £1.5m in preseed and seed stage startups, with 50% of the fund reserved for follow-on rounds.

It plans to back between 10 and 12 companies per year for four years, focusing on solutions in climate tech, financial empowerment and healthy ageing. It’s already backed 10 companies from this second fund since December 2022, one of which was closed this year. 


Alongside returning LPs Atomico, Big Society Capital and the British Business Bank, the second fund was backed by new investors The Export and Investment Fund of Denmark, The University Of Edinburgh, Molten and Legal & General Capital. Wise founder Taavet Hinrikus and Illusian, the family office of cofounder and CEO of Supercell Ilkka Paananen, also chipped in. 

Championing diversity

On the whole, the diversity of which founders get funded across Europe remains fairly dire.

In 2022, just 2% of the total funds raised across the continent went to female-founded startups, and a 2021 report found that 75% of founders in the UK come from advantaged socioeconomic backgrounds. 

But Ada Ventures says that its first fund, which closed in 2019, boasts a portfolio that is 14x more diverse than the average UK venture fund when it comes to gender and race or ethnicity. 

Currently, 74% of the Ada Ventures’ portfolio founders are from an underrepresented background, and 48% have a female founder. 44% of companies are led by ethnic minority founders. 

In October last year, the firm launched its Inclusive Alpha initiative, a set of investment principles that it employs to encourage inclusivity. 

It includes commitments to build a diverse investment team to access founders beyond ‘warm’ networks. This is partly done through its angel scout programme, which recruits experienced founders and operators who are involved in an underrepresented community to diversify dealflow and access underrepresented groups. 

Ada Ventures shared that 9 out of the 28 companies backed by its first fund came from its angel scouts, and that the companies referred by scouts typically featured more diverse founding teams: for Fund I they brought 10x more all-female teams and 6x more all-black teams than the UK benchmark.  

It also pledges to support portfolio founders, and in October became the first firm in Europe to offer help with childcare costs. 

Sadia Nowshin

Sadia Nowshin is a reporter at Sifted covering foodtech, biotech and startup life. Follow her on X and LinkedIn