£1billion fund to support UK technology start ups
1 min read
A collaboration between three Government departments is set to build a venture capital fund worth £1billion over the next decade.
The Department for Business, Innovation and Skills, the Department of Energy and Climate Change and the Department of Health will each invest £150million alongside equal investment from the private sector.
The UK Innovation Investment Fund will operate on a Fund of Funds structure, which means it will not invest directly in companies, but rather invest in a small number of specialist technology funds that will then fund companies. Both the private sector and the Government believe the fund will provide a market return.
Lord Mandelson, Secretary of State for Business, pictured, said: "The UK Innovation Investment Fund will be a shot in the arm for the British venture capital industry. It is also a challenge to UK venture capitalists to follow the Government's lead in backing British entrepreneurs in building exciting new companies, investing in new technologies and creating jobs."
ELC chairman Harry Tee said the move was a 'direct result of the ELC pressure to give immediate assistance to technology start ups struggling to raise phase 2 or 3 finance in the current climate'.
"We met with Lord Mandelson in May to discuss this and other points. We are now pressuring the Government to get money to the point of need effectively and not to tie it up in bureaucracies. However, it's good to know that ELC is sometimes listened to."
