Boosting productivity through investing in venture and growth across the UK
Patient Capital Review
The UK receives approximately half as much investment into venture capital as the US, relative to the size of their respective economies. This difference is mostly driven by the quantum of capital invested per firm rather than the total number of firms that receive investment.
Venture-backed firms in the UK are less likely to receive follow-on investment than in the US and those that do, receive less. This reduces the long-term growth potential of UK companies and subsequently hinders productivity gains.
The government consulted on potential barriers to accessing finance and the means to overcome them as part of the Patient Capital Review. The Patient Capital Review concluded in Autumn 2017, and in November’s Budget, the Chancellor announced an action plan to unlock over £20 billion to finance growth in innovative firms over 10 years. This plan allocated additional resources to the British Business Bank in response to the Patient Capital Review.
A separate subsidiary of the British Business Bank, British Patient Capital builds on a successful 10-year heritage of investing £1bn into UK venture and growth capital. The British Business Bank’s Enterprise Capital Funds (ECF) programme has helped grow several start-up funds into major names in the VC market.
British Patient Capital will be seeded with c. £400m of existing and approved venture and growth fund commitments.
British Patient Capital invests in venture and growth capital, capturing value through financing the growth of innovative companies. We focus on investing in both fixed term and evergreen funds and will consider co-investment alongside our portfolio funds.
We only invest in commercially viable funds. Our role is to enable the best managers to effectively execute their planned investment strategy. We achieve that through anchoring, enabling first close, or boosting a fund to achieve optimal size.
Our long-term outlook and unique heritage enables us to target opportunities and situations where we believe the market has missed the potential to make outsized returns.
As we invest £2.5bn over the next decade, we will utilise our advantages to operate one step ahead of the market.
- Expertise to identify extraordinary potential rather than just tracking past winners
- Access to the best opportunities, through our reputation and relationships developed over many years
- Long-term outlook that enables us to hold positions that other investors cannot
- Scale to achieve attractive risk-adjusted returns, through both capturing cost efficiencies and diversifying risk across vintages, sectors, and company stages