Major British venture capital funds pledge to invest in fast-growing companies | News from Great Britain

A group of the UK’s leading venture capital funds, with more than £25bn under management, have signed an agreement backed by Chancellor Jeremy Hunt to increase investment in high-growth companies across the country.

In the government’s bid to attract private investment to Britain ahead of the Chancellor’s Autumn Statement, Hunt said the scheme, involving 20 of the UK’s biggest funds, was a “huge win” for the country.

Signatories include SV Health Investors, run by former vaccine task force chief Kate Bingham, and Northern Gritstone, the investment fund chaired by former Goldman Sachs chief economist Jim O’Neill.

Known as the ‘venture capital investment compact’, the pledge, which is voluntary, aims to strengthen the partnership between venture capital funds and the pensions industry to encourage investment in high-growth UK companies.

Hunt said: “This deal is a huge win – demonstrating that our world-renowned venture capital firms are ready to help our pension providers allocate funding to our high-growth companies.”

Under the industry-led initiative, firms will work with pension funds to identify and create more attractive investment opportunities in the private market and take advantage of the pension reforms announced by Hunt this summer.

The British Private Equity and Venture Capital Association, which spearheaded the deal, hopes the formal collaboration will persuade pension funds to become limited partners in funds they manage and advise.

The Treasury Department will host a roundtable to mark the deal on Tuesday. It is part of the Chancellor’s Mansion House reforms announced earlier this year to unlock billions of pounds of investment from the UK pensions industry to help fund high-growth companies.

These reforms were announced in July and the UK’s biggest pension fund managers – including Aviva, Scottish Widows and Legal & General – committed to investing 5% of default pension fund assets in private businesses, including infrastructure and companies with high growth.

The initiative plays a part in wider plans to increase investment in local technology and life sciences firms to help the UK compete with Silicon Valley. In recent years, Britain has consistently ranked near the bottom of the G7 for all sources of private investment in the economy.

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