The British Business Bank committed up to £90 mn to support a new generation of UK venture capital fund managers. The funding marks the first investments under the Microfunds segment of its £400 mn Investor Pathways Capital programme, according to Beinsure.
The Bank will become a cornerstone investor in 10 new microfunds, including Evertrue Capital, Common Ventures, Openseed VC, The Tech Bros Fund, Almanac Ventures, Future Impact Ventures, Blue Lake VC, Firstdoor VC, Mustard Seed Fund and Twin Track Ventures. Individual fund sizes range between £10 mn and £20 mn.
Investor Pathways Capital backs first-time fund managers, especially those who faced obstacles when raising institutional capital. The programme expands access to venture funding for high-growth UK businesses and supports a broader investment market.
The initiative is expected to attract substantial private investment while helping new managers establish institutional track records. All 10 funds will focus on pre-seed and seed-stage investments across technology, DeepTech, artificial intelligence, climate, defence and consumer sectors.
Mark Sims, Managing Director and Head of Development Equity Funds at the British Business Bank, said the first Microfunds cohort delivers on the Bank’s commitment to develop the next generation of UK venture capital investors. He said backing first-time managers and expanding access to early-stage finance strengthens the pipeline of high-growth companies.
The first Microfunds cohort under Investor Pathways Capital represents an important milestone, delivering on our commitment to build the next generation of UK venture capital investors. By backing first-time fund managers and improving access to finance at the earliest stages, we are helping to create a more diverse and resilient pipeline of high-growth UK companies
Mark Sims, British Business Bank
Rachel Reeves, Chancellor of the Exchequer, said the programme supports the government’s growth strategy by helping businesses start, scale and expand across the UK. She added recent reforms to the Enterprise Management Incentive scheme and venture capital tax programmes will support about £100 mn in additional investment each year.
The selected cohort reflects the programme’s diversity targets. Women account for 57% of General Partners, while 43% come from Ethnic Minority backgrounds. Seven of the 10 funds operate under solo General Partners. The remaining funds rely on teams of two or three partners.
According to Beinsure, the programme targets structural barriers within venture capital by expanding institutional funding opportunities for underrepresented managers.
The British Business Bank selected the cohort after reviewing 151 applications for the Microfunds segment. Every successful applicant represents a first-time institutional fund manager with experience in operating businesses, building investment communities or making early-stage investments.
Liz Bailey, Director of Development Equity Funds at the British Business Bank, said the selected managers bring specialist expertise across technology, artificial intelligence, climate and consumer markets. She said early-stage investing depends on understanding emerging technologies and fast-changing markets.
“These funds bring deep sector expertise and highly targeted strategies across sectors like technology, artificial intelligence, climate and consumer. That specialism is critical at the earliest stages, where understanding emerging technologies and markets can make a real difference to company outcomes. These funds are positioned to spot and back ideas early, in sectors that will shape the future economy”, Liz Bailey said.
Meghan Stevenson-Krausz, former CEO of Diversity VC, said wider access to institutional capital changes who receives investment and who builds the next generation of companies. She said the programme lowers barriers for emerging managers while making participation more attractive for private investors.
