The British Business Bank has confirmed Aegon UK, NatWest Cushon and M&G as its partners for the targeted first close of British Growth Partnership Fund I, also announcing plans for the launch of a Venture Link initiative for pension funds. 

All parties have now completed investment diligence and are finalising terms and structuring, although the partnerships remain subject to final terms and relevant approvals.

The British Business Bank said that it is targeting a first close of £200m by the end of the financial year, which would enable the fund to begin investing into high-growth UK companies in 2026.

Initially announced at the International Investment Summit, the British Growth Partnership is being established by the British Business Bank as part of its efforts to encourage more UK pension funds and other institutional investors into the UK’s most innovative companies.

The initial fund will seek to raise hundreds of millions of pounds, including a commitment from the British Business Bank, to invest in some of the highest potential opportunities in the Bank’s venture capital pipeline.

Making use of a direct investing strategy, co-investing alongside the Bank’s network of fund managers, the British Growth Partnership will leverage the Bank’s position to help develop pipeline of opportunities that are aligned with institutional investors’ needs.

Investments from the fund will be made on a fully commercial basis, independent of government, leveraging the Bank’s capability and market access to invest in a range of promising high-growth UK companies.

The Bank also confirmed that it is working with other investors, including London CIV, which became the first Local Government Pension Scheme (LGPS) pool to announce its intention to work with the bank on the launch of the British Growth Partnership earlier this year.

The British Business Bank also announced partnerships with Langham Hall, an established provider of fund administration, depositary and alternative investment fund management (AIFM) services, to support the delivery of BGP Fund I.

Isio also provided support and advice in creating and positioning the fund.

Commenting on the latest update, British Business Bank CEO, Louis Taylor, said: "Today’s announcement brings us one step closer to mobilising institutional capital at scale into the UK’s fastest growing companies, both diversifying pension portfolios and providing much-needed scale-up funding. 

"The British Growth Partnership will provide access to the Bank’s live pipeline of scale-up businesses, providing a vital bridge between institutional investors and the UK’s thriving venture capital sector.

"We are making strong progress with our initial fund and this news demonstrates the appetite across the full spectrum of pension funds to increase allocations to UK venture capital."

In addition to this, the British Business Bank has announced plans to launch a Venture Link initiative for pension funds, as part of which it will publish enhanced information on its commitments to venture funds. 

This would be part of a package of measures to help pension funds to boost their investment capability, support them as they develop their strategy, reduce barriers to investment and help to unlock billions more in long-term investment for UK science, technology and innovation.  

The British Business Bank will now consult with stakeholders on the design of the initiative.

---