Jay Dias

"Funding Collapse sends investment in start-ups to six year low" The Times today covering the shocking stats that VenturePath uncovered, with our partner Beauhurst. Great quotes from supporters Michael Moore CEO, BVCA and Julian David CEO, techUK. * UK VC funding at Series A is -44% from last year, and worsening * Q3 24 is down a staggering 57% from Q2, itself down from Q1 * 9 in 10 seed funded startups cannot access Series A VC funding, the next 'rung on the funding ladder' * Just 32 future scaleup companies across the whole of the UK were able to access their first VC funding round in Q3...a 6 year low * Half a billion less capital is going in to UK scaleups at Series A, than just 2 years ago! As the UK scaleup funding gap widens, we are losing ground against other countries, at both startup stage (a position the UK worked hard to achieve, since 2011), and for scaleup support. OECD data: 13th in the world for scaleup support, and that's before Series A funding access dried up. I get that its confusing. Another report (BBB, Nations & Regions) released this week spoke of positive trends in private investment, stating "The data for Q2 2024 shows that investment value has continued to grow". Great, I love to see optimistic data. But under analysis that bundles venture with private equity (later stage), where a few megadeals skew the numbers. Otherwise the exact opposite is true. Our independent research here, for the UK ScaleUp Investment Mission, is laser beam focussed on Series A. The funding round where companies move from the c.1m startups launched each year, through the 2,179 that access seed funding, into the rarefied category of being recognised as future scaleups, attracting Series A funding (£2-10m). The UK venture landscape is currently funding just 248 pa of these companies, and declining. We've been sharing this urgent call for support with the new Government since the day after the election. I've personally met with several Ministers, and spoke to all the relevant Government departments. I will shamelessly repeat loudly what is at stake. UK scaleup funding at Series A has nearly halved in a year, and continues to decline steeply, more than halving in the last quarter. VenturePath developed The UK ScaleUp Investment Mission to convene the scaleup support ecosystem and £7bn of funders to help address this problem, to improve nationwide access to VC investment, and create more venture-backed successes. We have clear support, clear recommendations to reverse this decline in UK scaleup investment, and have made a clear ask of Government for participation in this, to ensure immediate action is taken to create the conditions for success for UK scaleups, ensuring the focus on growth isn't undermined by lack of capital, or equitable access to it. Government decision makers, we'd love your interest, to progress to action. HM Treasury: Rt Hon Rachel Reeves Spencer Livermore James Murray & CC Poppy Gustafsson (welcome to the debate).

737

195 Comments

Yesterday I had the pleasure of appearing on CNBC to talk about the state of tech in the UK and Europe, touching on the state of IPOs vs PE acquisitions, sectors to watch and where the opportunity lies. Thanks for a great discussion Arabile Gumede! Some thoughts from the interview: Signs of Success: The acquisition of UK tech companies by prestigious private equity firms like Thoma Bravo is a testament to the strength and success of the UK tech sector. It's a clear indicator that UK companies are building substantial value and attracting significant international interest. Vibrant Ecosystem: Despite challenges, the UK and Europe boast a vibrant tech ecosystem, particularly in AI, cybersecurity, and fintech. The market has now stabilised post-pandemic, offering a fertile ground for emerging companies to thrive. Opportunity for scale-up investment: Looking at investment into SaaS companies, Europe is on par with the US in the early stages. It is at the scale-up stage that a divide appears – support and more investment into Europe and the UK’s growth companies will further strengthen the region’s tech scene. Watch a clip from CNBC here: https://lnkd.in/d7J8_FNP #Oxx #UKtech #VC #growth

154

8 Comments

ANNOUNCEMENT: We just launched our diversified fund investments feature on Mainshares 😲 Starting today, accredited investors can invest in SMB acquisitions managed by sophisticated investors via Mainshares I’ve been telling you all that we’re here to change the game of SMB investing for the better, and this is a huge step for us. Before, SMB investing was commonly done on a deal-by-deal basis, and depending on who you are, you may not have the time to spend parsing out every deal. Well now, investors on our platform have access to deals across a variety of industries, geographies, and deal structures in this (traditionally) inaccessible and fragmented asset class. Invest in ~20 SMBs, all with a single investment. Join the Mainshares train before we take off like a 🚀 Link below for diversified SMB investing 👇

81

6 Comments

We've raised $1.3B Balderton Capital in new funds across early and growth to continue supporting UK & European technology founders. This is the 8th(!) fundraise I've been part of and have shared some thoughts on why venture matters, how fundraising in Europe has changed and how we differentiate ourselves through conviction here: https://lnkd.in/e2XRcagq

660

45 Comments

It was a great pleasure attending the Operating Partner Forum in London this week and engaging in thought-provoking discussions with industry peers, sharing best practises and learning how they are tackling some of the headwinds we are facing. The event covered a range of topics, but high on the agenda was the digital strategy and how to leverage AI as a driver of value creation. Here are my top three takeaways: #1 AI is coming, but getting the fundamentals right matters more: While AI has great potential and we will see significant product enhancements and productivity boosts opportunities in the near future, the real value today comes from getting the basics right. Strong processes, controls, an effective operating model, and robust data structures and systems are crucial for success. #2 Data maturity and organizational readiness: It's essential to assess and improve your organization's data maturity to ensure readiness for advanced analytics and AI implementation. This is a journey not a sprint. #3 Clear ownership of the digital agenda: Clearly distinguish between IT roles (infrastructure, architecture, cybersecurity) and data analytics roles lead by business and addressing business needs. This separation helps ensure we are addressing effectively real business needs and driving the digital strategy forward. #operatingpartnersforumeurope #operatingpartner #valuecreation #privateequity #carveout #transformation #parlementiacapital https://lnkd.in/ee_s_Gdb

54

3 Comments

Ever wonder what its like to run a Private Equity fund? Now you have the chance to follow along with successful investment managers by participating with Fund Launch Partners. Join me and Lincoln Archibald and next week for the Third Thursday @ Three to hear about direct investment opportunities with General Partnerships in the one of the fastest growing portfolio investment sectors. Pick up a free ticket here: https://lnkd.in/dd2yzxDd #HolyGrailofInvesting #GPOpportunities #FundLaunch #Alternatives

43

Insightful article….worth a read.

15

Great conversation yesterday at Preqin with Preqin's Cameron Joyce, CFA, CAIA, Blue Owl Capital's Cara Griffiths, Bain Capital's Tom Sargeant on the future of fundraising for private markets. Where will AUM come from going forward? What are the challenges that funds will face in fundraising? What strategies will be most popular going forward? It was fascinating to hear the perspectives of some of the industry's biggest platforms in Blue Owl Capital and Bain Capital from Cara and Tom, respectively, as to where fundraising is headed given their purview on the market and from Cameron on his data-driven insights from market research and plenty of numbers crunching on what it will take for private markets to grow to $30T AUM by 2030.

40

🌱 Looking to Connect with Leading VCs and Early-Stage Investors? 🌱 At Virtualnonexecs, we don;t only work with PE firms - we are also proud to be working with some of the UK’s most active early-stage investors to help them find the top board advisors and chairs who can drive impact. If you're a non-executive or chair looking to connect with the heart of the startup ecosystem, take note of the names below. Here are 10 of the UK's most active early-stage investors and the incredible numbers that back them: 1. Octopus Ventures - Backed 100+ startups, with a portfolio value of over £1.3 billion. 2. Seedcamp - Over 400 startups funded, including unicorns like Revolut and TransferWise 3. LocalGlobe - Invested in 300+ startups across deep tech and fintech. 4. Playfair - Early backer of companies like Stripe and Anduril. 5. Passion Capital - Early investor in Monzo Bank, managing £100M+ in assets. 6. Ascension - Over 100 startups backed with a focus on social impact and fintech. 7. Frontline Ventures - Backed 80+ startups across Europe with a key focus on B2B. 8. MMC Ventures - £500M+ under management, supporting 60+ innovative growth companies. 9. Balderton Capital - Invested in 220+ startups with notable exits like THG. 10. Entrepreneur First - 500+ startups built, including companies now worth over $10 billion collectively. ✅ To join Virtualnonexecs: https://lnkd.in/eXBj687 ✅ If you are a VC or company looking to hire: https://lnkd.in/d3na7CEC #NonExecutiveDirectors #Chairs #VentureCapital #Startups #Virtualnonexecs #BoardRoles #Leadership #BusinessGrowth

15

1 Comment

Very proud to see the WVC:E dream team - Anisah Osman Britton MBE & Rachel Drapper - alongside long time friend and rockstar Ekaterina Gianelli on stage at TechBBQ discussing "Fixing the Talent Exodus in VC". Key Takeaways: 💰Impact of Consolidation on Culture and Talent: The ongoing consolidation in the VC industry is reshaping company culture, affecting morale, and influencing talent. 🚀Emerging Managers Aren’t Diversifying VC: Despite the rise of emerging managers, the industry remains largely homogenous, with many new managers still coming from the same traditional, non-diverse backgrounds. ⚠️Perceptions of Diversity as High Risk: Many in the VC industry continue to view diverse hires, investments, and business models as "high risk," "too time-consuming," or "too costly," perpetuating a cycle of exclusion. 🚼 Parental Leave Inequality: Inequities in parental leave policies are disproportionately affecting women in venture, creating additional barriers to progression. But there are funds, investors, LPs and organisations (like us!) that are trying to change this!

81

4 Comments

Extremely worrying data about VC funding in the UK. While we all understand that taxes must go up to pay for the mismanagement of the Covid crisis by the then administration - allied to economic headwinds caused by Brexit - surely we must also protect the parts of our economy that can stimulate jobs and growth...ie - early-stage business?! In my opinion the most impactful and simple way to do this would be to increase the SEIS allowance to £1m from £250k and make it applicable to companies upto 5 years from their initial trading date from the current 3 year limit. This will bring a huge amount of fresh capital into the early-stage investment market...especially if the govt increases CGT overall. If we don't protect early-stage innovation we will never get out of economic trouble. #earlystageinvestment #venturecapital #SEIS #funding

5

1 Comment

Very much looking forward to joining the discussion and sharing the importance of embedded finance within our products. Embedded finance has the potential to revolutionise customer experience across a number of verticals, offering unparalleled convenience to keep up with evolving consumer expectations. #FTTEmFin #FintechTalents #embeddedfinance

20

Recent M&A market performance is showing significant signs of recovery from the lows of H2 2023, with the growth in PE and PE-backed deals leading the charge.

8

I couldn’t be prouder to be a Venture Partner at Isomer Capital (aka the best European FoF - at least for me) as we just announced the launch of our pioneering £100m secondaries fund. This fund is dedicated to acquiring stakes from LPs in various VC funds, tapping into a massive and largely unexplored market. 🌟 Key Highlights: - Focused Investment: Primarily targeting stakes in VC funds, with selective investments in private companies. - Robust Funding: Already over 20% funded, thanks to strong support from Nordic family offices and a German foundation. - Market Potential: With a growing number of private tech companies and a VC liquidity crunch, Europe's VC secondaries market is poised for rapid growth. - Track Record: This isn’t Isomer’s first foray into the secondaries market. As a firm we’ve done several secondaries deals with portfolio companies and VC firms, including early-stage VC Seedcamp (in 2021) and mobility giant Bolt (in 2023). - Expert Team: Welcoming the amazing Omolade (Rachel) A., formerly of Coller Capital, as a principal to lead this initiative. 💡 Investment Strategy: - 65-75% of the fund will buy "LP interest" stakes in VC funds. - 15-25% will be directed towards stakes in companies. - Up to 15% reserved for flexible investment opportunities. 📈 Looking Ahead: We're targeting returns of 2-3x, with significant distributions expected in the next 4-7 years. As one of the few players in this space, we're not just participating in the market—we're driving it forward. Read all about it here: https://lnkd.in/dc7sbC3G #VentureCapital #SecondariesFund #EuropeanVC

23

1 Comment

A masterclass in private markets. A guest who has seen it all joined the latest Alt Goes Mainstream podcast. We welcomed HgT Chairman of the Board Jim Strang to the show and school was in session. Jim is a deeply experienced private equity professional who has been part of the industry as a GP, LP, investor, consultant, and now a teacher, board member, and advisor to a number of firms, including most recently as MD & Chairman EMEA Hamilton Lane and now as an advisor to CVC Capital Partners, Bain & Company, Pictet Group Alternative Advisors. Jim and I had a fascinating conversation about the evolution of private markets and what the future holds for large and small funds alike, as well as LPs. We discussed: * The step function changes that take private markets from $15T to $30T of AUM. * Why traditional asset managers may struggle to replicate the capabilities of alternative asset managers in private markets. * The importance of partnerships having a clear ambition and alignment if they want to build a scaled platform. * The challenges that managers in the middle face as large platforms and specialist managers are the differentiated firms in the eyes of LPs. * Why GPs need to find innovative solutions to address the needs of different types of investors. * Why building a strong brand is crucial to success in the wealth channel. Thanks Jim for sharing your wisdom and experience on private markets. We also welcome our new sponsor to Alt Goes Mainstream. We are thrilled to announce Ultimus Fund Solutions as podcast sponsor. This episode is brought to you by Ultimus Fund Solutions, a leading full-service fund administrator for asset managers in private and public markets. As private markets continue to move into the mainstream, the industry requires infrastructure solutions that help funds and investors keep pace. To assist with these challenging opportunities, more and more fund sponsors and asset managers are turning to Ultimus, a leading service provider that blends high tech and high touch in unique and customized fund administration and middle office solutions for a diverse and growing universe of over 450 clients and 1,800 funds, representing $500 billion assets under administration, all handled by a team of over 1,000 professionals. https://lnkd.in/eJ_enGzQ

70

5 Comments

Interesting article supporting our observations on inbound M&A into the UK. Both US and European trade and financial investors showing increasing appetite to buy UK private businesses #manda #mergersandacquisitions #investment

36

1 Comment

“In terms of their engagement with asset managers generally, boards should not be too reliant on that one individual person … the portfolio manager or investment manager is probably the closest thing that you have in [the investment] space to a CEO … And the CEO driving the investment side of the business forward is clearly a hugely important role, but are they actually the best person to talk to about the risk and compliance structures, the marketing of it, the IR side? And is there someone more akin to a COO?” 🎯 Great conversation with Alexander Denny for our latest episode of Enter the Boardroom. 👉 Link in post below. My three key takeaways: ➕ Mergers: “Directors should be fairly selfless …  in how they consider [mergers]. If it is the best outcome for shareholders … then although they might put themselves out of their directorship with that particular company, they're very likely to be rewarded by the investment trust marketplace in the long term by getting another board position. They've shown that they know what they're doing. They've got the M&A experience from doing it, and they've shown that they've acted in the best interest of shareholders." ➕Discounts: “What can [investment trust] boards do about discounts? I think we can improve the communication around investment trusts. It's a bit of an uphill struggle. And there's a part of me that thinks maybe it will never come to fruition. But in Europe, for example, people just don't understand investment trusts. So we don't get a lot of European capital flowing into [them]. If nothing else, we should be banging the drum saying, 'look, these are great assets, and they're pretty cheap.'" ➕ Exsley’s Razor: “There’s a famous cave diving quote called Exsley’s Razor: ‘One never truly knows one's limits until they are encountered. Once a limit is reached and exceeded, return is not always possible. The razor is dangerously sharp. It divides those seeking the knowable end from those who have found the ultimate destination.’ It's basically summing up this idea that some risks are worth taking, but they still need to be managed because there's certain uncertainties that will arise … And if you haven't built in the margin of safety, then … the consequences are absolute. But it doesn't mean that you shouldn't have been trying it to start with.” Alexander Denny is Committee Chair at the The Association of Investment Companies (AIC) and Trustee at the Nautical Archaeology Society. He is a former Managing Director at Pantheon Ventures and Head of Investment Trusts at Fidelity International. #entertheboardroom #boardofdirectors #investmenttrusts Jane Routledge, Quintin Price, Shefaly Yogendra Ph.D, Heather Hopkins, Lucy Walker, CFA, Nick Hewson, Susie Cummings, Beatrice Hollond, Aidan Lisser, Sarah Bates, Jim Strang

24

8 Comments