The BVCA recently submitted a response to BEIS’ consultation on audit and corporate governance. Our Deputy Director General and Director of Policy, Gurpreet Manku, explains more.

What is the consultation about?

BEIS recently consulted on its proposed reforms to audit, corporate reporting and corporate governance for UK companies considered to be in the public interest.

When the proposed reforms were published in March, their purpose was twofold; to ensure continued investment into the UK, based on the strength and reliability of the information published by public interest entities (PIEs), and to safeguard the markets, investors, creditors, suppliers and – importantly…

How can venture capital firms improve their record on diversity?

The global Black Lives Matter protests of 2020 have forced the venture capital industry to confront its poor record on race. Barely any funding flows to black entrepreneurs and while venture capitalists are part of the problem, they also have the opportunity to make an outsized impact with their dry powder.

“The protests have shone a harsh spotlight on the entire investment ecosystem,” says Eric Collins, Co-Founder and Chief Executive of Impact X, which invests in companies run by or for underrepresented entrepreneurs. “For many investors, it has been a wake-up call.”

Just 0.5% of institutional capital went to start-ups…

As a melting pot of financial, tech and life sciences expertise and with a robust start-up scene, Edinburgh is proving popular with investors

The Edinburgh skyline, dominated by the castle, is famous across the world. Historical buildings and heritage are a major draw for tourists — as is the annual Edinburgh Fringe Festival, the largest arts festival in the world.

But Edinburgh is also an attractive destination for private equity and venture capital investors, which are drawn to its robust and varied start-up scene. The city has considerable expertise in areas such as fintech and health, and a number of facilities that help young companies to get off the ground.

The University of Edinburgh plays an important part, with its worldleading research attracting…

To maximise the profits that can come from committing to ESG, venture capital needs to elevate the issue beyond a due diligence consideration, says Seb Murray for the BVCA Journal.

Venture capital is no exception to the trend towards profit with purpose that is currently capturing hearts and minds within the business and investment community.

Even before the pandemic underlined the significance of looking beyond the bottom line, a survey by the European Investment Fund (EIF) found that seven in 10 venture capitalists were incorporating environmental, social and governance (ESG) criteria into their investment decisions.

The trend towards making a positive impact on society and the environment is driven in part by a growing body of research that suggests profit and purpose can go hand in hand. Indeed, the EIF…

Technology was one of the early heroes of the pandemic, but how are businesses’ long-term digital strategies evolving? Jane Douglas finds out for the BVCA Journal.

In the space of a year, organisations have stopped talking about the Fourth Industrial Revolution and started living it. Where once emerging technologies such as cloud and artificial intelligence (AI) were part of long-term plans, they are now at the centre of investment strategies for competitive businesses.

“We’ve seen a rapid embrace of disruptive technologies, starting at the beginning of the pandemic and continuing throughout,” explains Paul Henninger, Head of Data-Driven Solutions at KPMG UK.

“Technologies like automation, relatively advanced AI, such as natural language analytics, machine vision and equally just the use of data in real-time decision-making.”

Organisations had…

The nature of infrastructure has changed, and so has the nature of investing in it. Writing for the BVCA, Christian Doherty looks at the opportunities and challenges inherent in sectors such as energy, transportation, telecoms and other innovative technologies.

“If it doesn’t move, then it’s infrastructure.” It’s been a while since that old cliché has been applicable to the infrastructure space. And while investors continue to be attracted to traditional infrastructure projects — principally energy generation and transport — the sector as a whole has undergone a transformation in recent years as a number of ‘mega trends’ have taken hold.

“If you look at things like energy, transportation, certainly telecoms, and to a lesser extent water, things are changing extremely fast,” explains Simon Gray, comanaging partner at Arcus Infrastructure Partners. “In part, that’s driven by policy, in part it’s…

The future consumer is going to look very different from the present one, says Tom James for the BVCA Journal, who explains why this creates a remarkable opportunity for venture capital.

Wearable tech, novel healthcare devices and services, greater concern for the Earth, and the desire for instant solutions to all manner of questions: these are just some of the issues which will shape the consumer of the future. As the BVCA Summit tackles some of these thorny big-picture questions, we take a look into our crystal ball to see what might be on the horizon.

The world of work is changing at an exponential rate. Indeed, back in 1999 it was predicted that by 2030 a majority of the population will be employed in jobs which didn’t exist at the…

Economic turbulence, increasing competition and tech disruption are all causing much furrowing of brows for mid-market fund managers, but there are plenty of great opportunities out there for the smart investor.

The macro-economic environment is likely to have a major impact on mid-market investing over the coming years. That was the view of delegates at the BVCA Summit in October and, as one panellist noted, it would be very reckless to assume there won’t be a stalling of growth, if not outright recession in the years ahead. Such sentiment is affecting deal decision-making.

Companies with a strong financial profile, with easy to understand models, are commanding very high valuations. For other investors, a secular (non-cyclical) growth story, complemented with inorganic growth opportunities, are most attractive in this environment.

Technology has lowered…

The relationship between investors and fund managers is absolutely crucial to the private equity and venture capital model. At the BVCA Summit, we explored how it might change in the years ahead.

The audience at the BVCA Summit were asked to vote on whether the current private equity and venture capital environment is more favourable to investors or fund managers (or Limited Partners (LPs) and General Partners (GPs) to use industry lingo).

Almost half (47%) voted in favour of LPs. This compared to 41% for GPs and 12% seeing the situation as equally balanced.

Yes, there were a few more GPs in the room than LPs (although institutional fund investors numbered over 100 on the day). …

On 10 October, the BVCA held its flagship event in London, with more than 800 delegates gathering for a day of insight and debate on what the future holds for private equity and venture capital.

The theme for this year’s BVCA Summit: ‘the next decade for private equity and venture capital’ would be, at the best of times, fairly ambitious. As the BVCA’s chair, Cheryl Potter, noted: “At a point when you can’t imagine what the next 10 days might hold, it is a challenge to look forward to the next 10 years.”

The point was echoed by EY’s Chief Economist Mark Gregory. Given his presentation was titled ‘What might the economy of 2029 look like?’, he said: “I’m not sure what’s going to happen at 20.29 this evening.”

But after a day of debating…

BVCA

The British Private Equity & Venture Capital Association represents over 750 member firms, including more than 400 investment funds and institutional investors

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