30 November 2016
Legal & General Capital (LGC), the principal investment arm of Legal & General Group, with Woodford Investment Management and the British Business Bank, has today invested in Accelerated Digital Ventures (ADV), a new and innovative venture platform funding digital businesses across all stages of the funding cycle, from entry to exit.
Legal & General sees an opportunity to help drive the institutionalisation of the venture asset class and create a leading venture investment ecosystem across the UK. It believes infrastructure investment in our great cities and towns, in combination with a thriving digital venture investment industry leveraging the preeminent science and technology emerging from our universities, can act as a catalyst to drive improved productivity and UK economic growth.
The institutionalisation of venture funding will also benefit Mission Led Businesses, which lack access to start-up funding. The government’s sponsored review into Mission Led Business, Chaired by Nigel Wilson, Group CEO Legal & General, which is due to be published shortly, will propose measures to help support Mission Led Business funding and growth in the UK.
ADV plans to invest an initial £150 million in digital start-ups, through its platform offering access to capital, coaching, customers and corporates. Targeting existing digital technology hubs, including Belfast, Bristol, Cambridge, Cardiff, Edinburgh, Glasgow, London, Manchester, Newcastle, Oxford and Sheffield, it aims to provide equity capital to help 1000s of business start-ups to become globally successful UK scale-ups.
Paul Stanworth, Managing Director of Legal & General Capital (photo) said: “The UK has faced chronic underinvestment in physical and digital infrastructure for far too long. If we are to capture and catapult the best of British enterprise more akin to Silicon Valley, we need early-stage capital support. With ADV we are pooling together patient capital from three like-minded long-term investors as we back disruptive businesses and fuel innovation across all of the UK’s regions, not just in London. Legal & General Capital is already regenerating towns and cities across the UK, backing clean energy projects, building much-needed homes and providing debt finance for UK SMEs. Now we are getting to the root of UK enterprise by supporting thousands of tech start-ups and growth businesses, creating jobs and boosting the economy.”
ADV will inject patient capital at the very early stage of a business’s life, through accelerator hubs and incubators around the UK and through microfunds. It will also back growth and later stage businesses as they mature, offering both funding and expertise from industry experts and proven entrepreneurs. ADV's long-term aim is to invest upwards of £200m every year into UK-based start-ups and scale-ups.
Lee Strafford, CEO of ADV, said: “ADV has been established to help more of our emerging startups and scaleups to scale big. There are world class innovators in every corner of the UK. We intend to seek out the best investment opportunities at scale and ensure these companies, irrelevant of size and location, have the support they need to supercharge growth.”
The ADV team is made up of industry experts and proven entrepreneurs with extensive experience of scaling businesses across all stages and across the globe. The team includes:
The ADV investment builds on LGC’s expanding SME Finance platform which already includes the 40% ownership of Pemberton, an independent asset management group which provides much-needed finance to small and medium sized enterprises in response to the continued retrenchment by traditional bank lenders. Pemberton recently closed its inaugural European Mid-Market Debt Fund with €1.2 billion of commitments and earlier this summer backed a second fund which plans to lend £500 million specifically in UK businesses to support their growth.
LGC also invested £10 million in Cambridge Innovation Capital (CIC), a Cambridge-based investor in technology and healthcare companies, which raised a total of £75 million in August 2016. CIC is a preferred investor of the University of Cambridge and has a unique relationship with Cambridge Enterprise, the commercialisation arm of the University, including co-investment opportunities and access to pre-emption rights over companies arising out of the University. In addition, CIC has established an unrivalled position within the Cambridge Cluster. To date, the Company has committed approximately £53 million to 16 companies in the rapidly growing technology and healthcare sectors.
For more information please contact:
t: +44 (0) 20 3124 2095
m: +44 (0) 7515 324001
t: +44 (0) 20 3124 2777
Legal & General Capital (LGC) focuses on direct investments in key sectors, particularly housing, infrastructure and SME finance. These reflect our aim to invest for the long term in economically and socially useful assets, to secure competitive returns and to create new asset classes for Legal & General’s varied investment requirements, for our partners and for the wider marketplace. We work closely alongside other businesses within Legal & General to ensure the broadest range of skillsets are deployed on any project and to utilise principal investment and asset management synergies across the Group. Investments to date have included housebuilder CALA Homes, a Build to Rent joint venture, urban regeneration projects at MediaCity/Salford and Bracknell, SME finance group Pemberton and clean energy firm, NTR.
ADV is a new venture platform, created by entrepreneurs, operators, and collaborators. Its team have learnt the hard lessons and now want to pay them forward. ADV provides a full-scale model for venture, across the business lifecycle. It is a meritocratic investment platform that offers access to capital, coaching, customers and corporates; a platform that champions the innovators. It seeks to help build the large ‘difficult’ businesses that the UK is uniquely positioned to foster: the complex, technical, global ones that have a chance of solving real world problems. Say hello at www.accelerated.ventures.