The British Growth Partnership has raised £200m, backed by a group of UK pension funds to invest in British VC funds.
Pension providers Aegon UK, Cushon and M&G all contributed to the fund, which counts the British Business Bank (BBB), the UK’s economic development bank, as its GP. The BBB also invested.
The BBB invests in VC funds and directly in startups, with billions from its Patient Capital Funds also allocated to 93 funds and 47 fund managers. BBB created the British Growth Partnership to help pension funds increase their allocations into UK venture. This is the first time the bank has raised from external investors.
The first deployment via the British Growth Partnership will be an £8m investment into London-based Wayve, which makes autonomous driving software. The British Business Bank previously participated in the company’s $1.2bn round in February.
Aegon UK, Cushon and M&G are among the 17 workplace pension providers in the UK which are signatories of the Mansion House Accord, a commitment to invest at least 10% of defined contribution (DC) funds into private markets — including VC — by 2030, with 5% allocated to the UK.
“The UK has the world’s third largest venture capital market, yet pension fund capital has historically been deeply underrepresented,” Louis Taylor, CEO of the British Business Bank, said in a statement.
“To maximise the value of great British innovation, we must bridge the gap between the UK’s large domestic savings pool and our fast-growing companies.”
Peter Kyle, the secretary of state for the UK’s Department of Business and Trade, added: “Through the British Growth Partnership, we’re unlocking much needed funding, to scale the most ambitious, and cutting-edge, innovators right across the UK — so they can grow faster here at home and compete globally.”
