The Most Active UK Venture Capital Funds
Sam Peckett, 20 April 2023
After a record-breaking 2021 for both deals made and money invested, 2022 has seen purse strings tighten and investment of capital to startups slow. We saw that across UK startups and scaleups in 2022, the number of deals fell by 7% and the amount of money invested fell by 16%—but the outlook isn’t as gloomy as this might sound. In 2022, more deals were made and more money was invested than any year prior to 2021, and venture capitalists and private equity investments were instrumental, accounting for 43% of all deals.
A snapshot of 2022 investments
There were 2,722 announced equity rounds in the UK in 2022, with more than half of the deals going to London-based companies which accounted for 69% of the money invested. Of those equity rounds, private equity and venture capital funds participated in 1,329 of them—just under half.
London, perhaps unsurprisingly, remains the prime spot in the United Kingdom for venture capital firms and private equity funding. However, there are also particularly active funds that are focusing on other areas such as the North of the UK, making sure that capital is flowing into early-stage businesses regardless of location.
Top 10 most active VCs
We’ve profiled the ten most active private equity and venture capital firms in 2022, ranked by the number of deals they made in the UK’s high-growth ecosystem.
Number of Deals in 2022: 99
Topping the list of most active VC funds is Cheshire-based SFC Capital with 99 announced fundraisings in the UK in 2022, more than double all but two other funds. Previously known as Startup Funding Club, SFC Capital is an early-stage investment Seed Enterprise Investment Scheme (SEIS) fund that invests in UK companies at Seed and Series A stages, usually funding between £100k and £300k.
Since its first announced fundraising back in 2013, the fund has invested over £15m in 289 companies. Open to investing in companies in all sectors, notable businesses it’s invested in include Onfido, an AI-powered digital identity solution, Cognism, a sales data platform, and Transcend Packaging, a sustainable packaging company.
Number of Deals in 2022: 65
Venture capital firm Access EIS were involved in 65 announced fundraisings in 2022. The fund is managed by SyndicateRoom and it invests alongside a group of angel investors known as ‘super-angels’. These super-angels consistently outperform the market, with SyndicateRoom cross-referencing the startups chosen by the angels with its own index of high-growth companies. Access EIS works in partnership with its super-angels, matching the angel investment provided to the start-ups.
The fund invests in companies across all sectors from Seed to Series B funding. Notable investments include Moth Drinks, which produces high-quality canned cocktails, and SolasCure, a medical company working to improve wound treatment.
Number of Deals in 2022: 54
Octopus Ventures was founded in 2000, and focuses on investment opportunities in health, fintech, deeptech, consumer and B2B software that can ‘change the world’. Investing in 54 UK companies in 2022, all businesses Octopus Ventures invests in must have a UK presence. The fund typically invests up to £1m for Seed funding rounds and up to £10m for Series B funding, with opportunity for continued investment in the companies it backs through to IPO. Since 2008, the fund has backed over 180 companies, and 32 of those have successfully exited.
The fund is a Certified B Corporation, and its business model involves taking a seat on the board of its portfolio companies and providing ongoing business support. Octopus Ventures has an impressive list of businesses it’s backed, including clothing reselling platform Depop, online car retailer Cazoo and real estate company Zoopla.
BGF Growth Capital
Number of Deals in 2022: 47
Formerly the Business Growth Fund, BGF Growth Capital launched in 2011 and is an equity investment fund backed by five of the UK’s largest banks: Barclays, HSBC, Lloyds, RBS and Standard Chartered. The institutional investors are involved in both equity and loan funding at Series A and B stages. The companies it invests in must have a strong business plan, as it won’t invest in pre-revenue businesses or businesses with a turnover of less than £2m. Investments are typically between £2m and £10m for equity stakes of 10-40%, but the fund can invest beyond that in further rounds.
Investing in UK and Irish companies, BGF Growth Capital provides funding for growth capital, strategic acquisitions, site roll-outs, product development, sales and marketing assets, and the purchase of new assets. A notable investment is recipe box delivery company Gousto, which became a unicorn in 2020.
Number of Deals in 2022: 34
Ascension is based in London, and invested in 34 UK startups in 2022. It focuses on early-stage investments between £500k and £5m, and provides businesses with growth capital, mentoring services and access to its network of industry contacts.
Built by exited entrepreneurs and focusing on Seed and Series A funding, Ascension was voted Seed VC of the Year in 2022 by UK Business Angels Association, and was the most active venture capital firm in London between 2011 and 2021.
The fund typically invests in technology and impact businesses, primarily in the UK, and has backed over 175 startups to date. Ascension’s key investment areas are next-gen media, e-commerce, fintech, sustainability, and digital health and life sciences. Notable investments include the dating app Thursday, and personalised audio-ad company A Million Ads.
Number of Deals in 2022: 31
Having invested in 31 startups in 2022, Fuel Ventures is an early stage venture capital investment fund based in London. The fund has invested in over 50 pre-Seed companies and over 60 Seed to Series A companies to date.
Founded by exited entrepreneur Mark Pearson, Fuel Venture’s investments are focused on early-stage startups in the UK with high growth potential. It regularly invests in tech startups that provide products in scalable marketplaces, platforms, SaaS businesses and transaction technologies. The fund invests between £150k and £3m into companies, and then works closely to provide ongoing support and follow-on funding to its top performers.
Number of Deals in 2022: 28
Seedcamp invested in 28 UK businesses in 2022 and has invested in over 460 startups across Europe since being launched in 2007. Focusing on early-stage companies, it only invests at pre-Seed and Seed rounds. Seedcamp typically invests around £300k at pre-Seed stage for a 6-7% share of a business, and up to £500k in Seed funding rounds. The fund provides ongoing business support to its founders, and the companies in its portfolio have gone on to raise over $7b in follow-on funding.
The fund has a focus on businesses that are sustainable and will contribute positively to the world. It is also part of ESG_VC, a steering group to make sure venture capital firm investments have a focus on environmental, social and governance factors.
Seedcamp’s portfolio includes six unicorns, including Wise, a UK-based foreign exchange company, Revolut, a banking, stock trading and currency exchange company and Pleo, a business expense management business.
Number of Deals in 2022: 26
Launched in 1999, LocalGlobe is a venture capital firm that provides Seed and Series A funding to London-based founders and has invested in 26 UK companies in 2022. Having invested over £1b into UK companies since its inception, LocalGlobe is part of a series of funds which includes Latitude, a growth stage fund which invests at Series B and C, and Solar, a fund that invests in Series D to IPO. This series of funds sets them apart from many other European investors by allowing the startups it invests in to have a clear funding pathway to public listing.
LocalGlobe has a proven track record with a history of successful investments in tech companies, including previously mentioned unicorn Wise, the app-based bank unicorn Monzo, and travel management company TravelPerk, which has a valuation of $1.3b.
Number of Deals in 2022: 25
Par Equity backed 25 early-stage startups in the UK in 2022, providing funding from Seed to Series A. When investing through its Enterprise Investment Scheme (EIS) Fund, Par Equity makes initial investments of £500k to £1m, while it makes investments of £1m to £5m through its Healthcare Fund.
Based in Edinburgh and founded in 2008, it invests in companies in Northern England, Scotland and Northern Ireland, and provides ongoing support to its portfolio companies. It looks for innovative startups working in communications, cleantech, medtech, electronics and media, and can participate in and sometimes lead follow-on investment rounds, offering long-term financial support.
The venture capital fund has invested in companies such as Current Health, an artificial intelligence healthtech company that produces software that can detect warning signs of health issues to improve healthcare outcomes. Current Health exited for $400m in 2021. Other investments include The Skinny, the UK’s second-largest entertainment and listings magazine.
Carry Back EIS Fund
Number of Deals in 2022: 23
Carry Back EIS Fund is managed by Ascension, and typically invests £1m to £10m in Seed to Series A funding rounds.
Making its first investments in January 2022, the fund has quickly risen to be one of the most active VC firms for UK companies, investing in 23 startups in 2022. The fund’s focus is on investing in companies in the UK and to date it has invested over £84m.
The fund co-invests in deals alongside other Ascension-managed funds, giving them access to startups such as GetAgent, an estate agency comparison website to help sellers choose an estate agent, Nook, which integrates all invoices and bills into one place to make payments easier, and Suvera, a medication reminder tool.
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