A consortium of some of the UK’s largest pension providers has announced its commitment to explore the establishment of a first-of-its-kind vehicle dedicated to investing up to £1bn in scaling UK science and tech businesses.
The ambition is a fund of sufficient scale to target the best opportunities born out of UK innovation in science and technology.
The fund would seek to deliver strong long-term returns for pension providers and their members by investing in successful UK companies. By helping innovative businesses to scale up, commercialise new technologies and create skilled jobs, it would support economic growth while helping pension savers benefit from larger retirement pots and stronger local economies.
READ MORE: Liverpool AI agent specialist acquired in potential £16m deal
By bringing together major pension investors, the UK Scale-up Fund would help connect institutional capital with the companies, founders and venture managers driving the next wave of British innovation.
As part of this initiative the British Business Bank is working alongside the pension providers to support the launch of the fund and with the intention of investing in partnership with the group. The Office for Investment is also supporting the consortium as it explores the development of the fund.
PM Andy Burnham said: “Today sends a clear message: this is a vote of confidence in British business, British talent and British ambition.
“This new fund would help unlock good growth in every postcode, connecting pension investment with the entrepreneurs and technologies that will reindustrialise Britain and create the jobs of the future.
“That means more opportunities for working people, stronger returns for savers, and more businesses choosing to start, grow and stay in Britain.”
Business, Innovation, Science and Trade Secretary Jonathan Reynolds said: “Britain leads the way in science, technology and innovation, and we want to ensure more of our most promising businesses can start, scale and succeed here in the UK.
“The ambition of major pension providers to back the next generation of British success stories is an important vote of confidence in UK innovation. By investing in innovative UK companies, they can help drive long-term growth while helping pension savers share in their success.
“Our message is clear. Britain is open for business, open to investment and determined to put science, technology and innovation at the heart of our economic future.”
Andy Bord, CEO of the railways pension scheme Railpen, said: “Our priority is always to deliver strong long-term outcomes for our members. The UK is a dynamic powerhouse of innovation. The UK Scale-up Fund represents a compelling investment opportunity where disciplined, patient capital can help growing companies scale, provide attractive returns for pension savers and generate lasting economic growth.”
Ian Cornelius, workplace pension provider Nest’s CEO, added: “The UK is home to many innovative, high-growth businesses and has a strong track record of nurturing world-leading science and technology companies, with many of today’s global success stories founded here.
“As a long-term investor on behalf of more than 14 million members, Nest sees an important role for pension capital in helping successful UK businesses access the funding they need to grow. We believe there can be a strong alignment between delivering attractive long-term outcomes for members and supporting innovation, job creation and economic growth across the UK.”
