London Co Investment Fund launches with £85m to invest in tech start-ups
New fund dedicated to London firms will invest in a tech, digital and science start-up every week for the next three years
A new venture capital fund was announced yesterday with up to £85m to invest in London based start-ups in the science, technology and digital sectors. The London Co Investment Fund (LCIF) will team up with co-partners to invest in over 150 new businesses from 2014 to 2017.
The LCIF was established by Funding London (FL) and Capital Enterprise (CE) with an initial investment of £25m from the mayor of London’s Growing Places Fund.
The FL and CE will invest between £25,000 and £1m in seed rounds directed by the six chosen co-investment partners: Crowdcube/Braveheart Consortium, Wellington Partners, London Business Angels, Angel Lab, PLAYFAIR Capital and Firestartr.co. 38 venture capital funds initially applied to be partners.
Partners are obliged to invest at least £1 for every £1 invested by the LCIF, but on average the fund is expecting partners to invest £2.90 per ever £1.
According to CE’s CEO John Spindler, the LCIF “will be investing in one start-up every week for the next three years,” with the aim of helping fast growth start-ups to scale up by subsidising finance acquired through the six partners. The aim is not to help start-ups unable to get funding but rather allow fast-growth firms who are already raising to raise significantly more.
Co-founder of Crowdcube Luke Lang, who along with association partner Braveheart Investment Group plc has been awarded £5m of the overall fund, commented:
“For the UK Government to invest in London’s top start-ups through Crowdcube, alongside the crowd, is an exciting prospect…
“Working with Braveheart, with its extensive fund management experience, we’re determined to deliver returns for investors and help London’s best technology, digital and scientific start-ups secure the investment they need to expand, create jobs and become the global pioneers of tomorrow.”