Long-term investment vital to closing funding gap

"In a record year for UK equity investment in the UK’s smaller businesses, the British Business Bank’s Small Business Equity Tracker highlights British Patient Capital’s contribution to a remarkable £10.8bn invested in growth stage companies in 2021.

British Patient Capital’s growth-stage deals averaged £32.9m in size over the period – considerably larger than the overall equity and VC/PE market, and demonstrating a successful focus on supporting later-stage growth companies. British Patient Capital was also among the biggest contributors of deals to academic spin-out companies, at 24% of the total Bank deals.

However, the Small Business Equity Tracker also shows that the UK has a lower proportion of VC deals and investment going into deep tech and R&D-intensive companies than any other countries, and that this is the primary cause of the overall UK-US VC funding gap.

Whether leading the charge on ground-breaking gene therapy, driving the global race to develop and deploy vaccines, or developing quantum computing capability that will enable life-changing discoveries, these sectors are not only central to addressing global challenges, but are critical to the UK’s own prosperity.

The funding gap reinforces the importance of both the Life Sciences Investment Programme (LSIP) and Future Fund: Breakthrough – created to enable long-term investment in R&D-intensive UK companies and high-potential UK life sciences companies. These companies not only offer significant opportunities for investors, but are the world-class businesses of the future."