£80m London Co-Investment Fund for Science Start-ups

Budding tech and science start-up businesses in the capital who are looking to raise the finance they need to take their business to the next level can take advantage of a venture capital fund for small businesses.

The London Co-Investment Fund is supported by £25m from the Mayor of London through the London Enterprise Panel’s ‘Growing Places Fund and up to £60m from six private sector partners. It is expected to invest in more than 150 small businesses plus spur the creation of up to 2,600 new jobs.

The new Fund specifically targets small businesses which have found difficulties in raising investment, typically of between £250,000 and £1m to expand existing capabilities: Businesses wishing to apply will need to demonstrate they have the potential to create new jobs and be capable of delivering financial returns of ten times the cash invested in them.

Mayor of London, Boris Johnson said: “London’s tech sector is flourishing and the city is a hotbed of talented young and ambitious people buzzing with exciting ideas who are setting up new companies in their droves. Despite this boom, we know that many budding start-ups find it difficult to raise the finance they need to grow. This new fund will ensure the tech-giants of the future can get the support they need to bring their ideas to reality and deliver jobs and growth for the capital.”

The six private partners have been selected following a year long process. They are: Wellington Partners, Playfair Capital, London Business Angels, Angel Lab, Firestartr and Crowdcube/ Braveheart Consortium.

London’s tech sector has become the biggest cluster of expertise in Europe over the last three years. There are over 34,400 digital technology businesses and 155,600 digital technology employees in the capital. The city boasts one of the most vibrant start-up scenes in the world with more than 32 accelerators and incubators to assist start-ups looking to establish themselves – more than the whole of France and Germany. The new fund will help companies looking to move beyond those incubators.

The London Co-Investment Fund will be managed by Funding London. The initiative was originated by and developed in partnership with, Capital Enterprise (the membership body for universities, accelerators and incubators that support entrepreneurs in London). Capital Enterprise’s on-going role will be to lead on the promotion of the London Co-Investment Fund and to develop and run a pipeline of investment-ready tech businesses that will be referred to the Fund’s selected co-investment partners.