British Patient Capital, the venture capital arm of state-owned British Business Bank, is targeting life sciences and fintech as ripe sectors for investment going forward.
In its first year, BPC, which backs venture capital funds focused on growth businesses, made 12 investments totalling £334m. Underlying businesses its funds have invested in include:
- £9m commitment in the Dementia Discovery Fund, which invests in science to create targeted new medicines to treat dementia
- £30m cornerstone investment in listed venture capital firm, Draper Esprit
- £50m investment in the Dawn Capital Opportunities Fund to further support its highest potential businesses
These, combined with a seed portfolio acquired at launch, takes its portfolio to 31 fund investments of £600m in 322 underlying businesses.
So far, the biggest areas of investment across BPC’s portfolio of underlying companies have been AI and big data (25pc), digitisation (18pc), life sciences and digital health (15pc) and the future of finance (13pc).
Catherine Lewis La Torre, chief executive of BPC, said the fund is preparing to write some “big cheques” to help support the British tech industry, which faces a funding squeeze as EU funding is set to disappear post Brexit.
The VC investment arm of the British Business Bank aims to provide so-called “patient capital”, the long-term finance needed by companies after their start-up phase when they want to scale up.
This sort of scale-up funding is seen as the missing piece of the jigsaw by some investors, with funds mostly focused on the initial start-up period. The concern is that founders have no alternative but to let themselves be bought out by larger, often US rivals, if they want to grow.
Catherine Lewis La Torre, CEO, British Patient Capital, said: “This activity establishes British Patient Capital as the largest domestic investor in venture and venture growth capital in the UK.
Keith Morgan, chairman of BPC and chief executive of its parent British Business Bank, said: “With £2.5bn of funds to invest into venture and venture growth capital funds over the next decade, British Patient Capital is working alongside institutional investors with the aim of attracting a further £5bn of patient capital investment, unlocking £7.5bn of finance.”