BGF, the UK and Ireland’s most active growth capital investor, is preparing for its first external fundraise to give new institutional investors the opportunity to back UK growth companies through its established regional platform.
The move would enable institutions seeking to deploy capital into UK SMEs to invest alongside BGF’s existing shareholders – Barclays, HSBC, Lloyds and NatWest – while benefiting from its proven record of strong, risk-adjusted returns.
With Lazard appointed as adviser, BGF could raise up to £500 million from institutional investors next year as part of its commitment to invest over £3 billion in UK businesses over the next five years. The firm’s platform has generated a 21.4 per cent internal rate of return since 2016, underscoring its success in identifying and scaling promising enterprises.
Founded in 2011, BGF has invested more than £4.7 billion across 600 companies, helping create over 27,000 new jobs and driving £7.1 billion in revenue growth.
Crucially, 74 per cent of its capital has been deployed outside London and the South East, strengthening regional economies across the UK. Its investment philosophy of patient, minority capital aims to bridge the funding gap for ambitious small and mid-sized businesses.
The potential fundraise aligns with the Mansion House Accord, which encourages UK pension schemes and institutions to make long-term investments in high-growth domestic enterprises.
Andy Gregory, CEO of BGF, said:
“The case for supporting this country’s ambitious entrepreneurs is clear and one recognised by government as a priority.
“Over the past decade, we’ve proudly backed hundreds of founder-led businesses, supporting them with the capital and expertise they need to scale and succeed. These companies are the backbone of our economy, and it is vital that they receive not only funding but also the support required to thrive.
“We are now in the early stages of exploring a capital raise that could unlock further sources of funding into this crucial segment of the UK market. We know that institutions such as pension funds are keen to work to the Mansion House Accord, channelling long-term institutional capital into UK growth companies.”
Recent exits highlight BGF’s investment success: OrganOx, the Oxford-based medtech firm, reached a $1.5 billion valuation, generating a £175 million return on BGF’s £35 million investment; Monodraught, a Buckinghamshire green tech business, achieved an 11x return at a £56 million valuation. Other notable exits include Brisant Secure, Fulfilmentcrowd and Braidwater.
Read more: OrganOx delivers record returns for BGF with landmark $1.5bn MedTech valuation exit
With more than a decade of proven delivery, unmatched scale, and a clear mandate to support high-potential businesses nationwide, BGF is poised to deepen its role as a cornerstone of UK growth.
