Most Active Venture Capital Firms in London

 

For many years now, London has set the bar for entrepreneurialism and venture capital (VC) financing in Europe, even competing with Silicon Valley. Since 2011, venture capital firms have invested over £26 billion in the startup ecosystem of the city, funding anything from high-risk pre-seed businesses to more established businesses. According on the volume of investments made in London-based businesses between 2011 and 2021, we've rated the 26 most active venture capital funds in the Capital. For complete biographies on each fund, including information on their investment criteria and examples of the rapidly expanding companies they have supported, scroll down.

What are venture capital funds?

Before both crowdsourcing websites and angel investors, venture capitalists are the most frequent equity investors into high-growth businesses. VCs specialize in acquiring stock in private firms and raising their values. What distinguishes venture capital financing from other types of startup finance, though? Contrary to other institutional investors, many venture capitalists have founded their own firms and can thus give their knowledge and longer-term assistance in addition to growth financing.

Compared to private equity and hedge funds, venture capital funds also often invest in riskier portfolios, albeit each fund will have its own set of rules defining the kinds of investment possibilities taken into account. Fund managers (general partners, or GPs) make these choices, while high-net-worth individuals or major corporations often provide the funding (Limited Partners or LPs).

London's Most Active Venture Capital Firms, 2011–2021

1.Octopus Ventures

Octopus Group, a fund management firm founded in 2000 by Simon Rogerson, Christopher Hulatt, and Guy Myles, has grown to include wealth management, energy, and real estate. Through its European venture capital arm, Octopus Ventures, it makes investments in private firms.

Since the fund's inception in 2008, the industries in which it has made the majority of its investments have been healthcare, fintech, deeptech, and consumer. It seeks to support businesses run by outstanding entrepreneurs who want to have a big, good influence on the world. Investments generally begin at £1 million for seed rounds and £10 million for venture rounds, and the fund aims to assist its portfolio firms all the way to the initial public offering (IPO). Along with its Venture Partners, the fund also offers businesses access to a network of coaches and operational consultants.

95 London-based businesses have received support from Octopus Group since 2011 in at least 162 equity agreements. Secret Escapes, the online stores Depop and Cazoo, allplants, and the food waste reduction software OLIO are some of the well-known brands in its portfolio.

02. Seedcamp

Founded in 2007, Seedcamp finances entrepreneurs that are utilizing technology to take on large, international industries. The fund mostly invests between £100k and £2m in early-stage businesses. Despite being sector-neutral, Seedcamp often invests in software-as-a-service (SaaS) businesses. The fund assists the firms in its portfolio in determining product-market fit, expands their sales and marketing teams, and connects them with a worldwide network of specialists.

A number of the UK's unicorn startups, including Revolut, Wise (formerly TransferWise), and the virtual events platform Hopin, have been funded by the fund, which has a strong track record. Top fintech businesses Primer, Curve, and challenger bank Monese are all part of its portfolio. Through at least 149 distinct equity funding rounds, Seedcamp has invested in 108 ambitious startups in London since 2011.

03. SFC Capital

An early-stage investment company called SFC Financing provides growth capital to entrepreneurs in the UK. SFC (formerly Startup Funding Club) invests between £100,000 and £300,000 in EIS or SEIS-eligible businesses, regardless of industry, provided they show a distinct USP and early traction. The company positions itself as a "people business" and seeks to develop enduring relationships with business owners and investors. The fund has a unique business strategy that combines its famous angel network with its own initial investment fund.

SFC Capital has provided at least 148 equity investment rounds to 123 promising companies in London since 2011. Vertical Future, a vertical farming technology startup, Onfido, a provider of face biometric security, Nossa Data, a maker of ESG data analysis software, and CodiKoat are among the companies in its portfolio. The fund most recently received the UKBAA's "Most Active Investor in the Regions Award 2021" and the EIS association's "Best SEIS Investment Manager 2021" awards.

04. Index Ventures

Many London unicorns, including Deliveroo, FarFetch, Funding Circle, Wise, and Revolut, have been clients of Index Ventures. And a striking proportion of the firms it invests in have had profitable initial public offerings. The fund works with entrepreneurs in any industry and at any level, although eHealth or healthtech firms, SaaS startups, and seed-stage and venture-stage fintech startups seem to be of special interest to the fund.

The fund has supported at least 64 London-based businesses since 2011 by participating in 126 separate equity fundraising efforts. Index Ventures positions itself as a human-centred, worldwide fund that collaborates with company owners to develop innovative concepts into global enterprises. Currently, it maintains offices in San Francisco, Geneva, and London.

05. LocalGlobe

LocalGlobe, which is run by the father-and-son team of Robin and Saul Klein, focuses on entrepreneurs in London who are often at early-stage internet firms. The investment team often keeps its investment criteria under wraps and likes to meet entrepreneurs via friendly referrals. However, it often makes investments in SaaS and artificial intelligence (AI) businesses.

LocalGlobe, which debuted in 2016, is a very active investor in London's startup scene. In the Capital, the fund has supported 69 firms via at least 104 equity investment rounds. Edtech company Kano, B2B challenger bank Tide, startup recruiting site Otta, budgeting tool Cleo, and Wise are all part of LocalGlobe's portfolio.

06. Passion Capital

An early-stage venture capital firm called Passion Capital targets startups in the software, e-commerce, and digital media sectors. The fund's initial investment size aim was from £150k to £200k, although it has now executed a broader variety of acquisitions.

Since it was founded in 2011, Passion Capital has contributed at least 101 equity investments to London's fast-growing tech community, assisting 50 aspirational entrepreneurs. Monzo, GoCardless, proptech Nested, mental health firm Spill, and insurtech unicorn Marshmallow are among the companies in the fund's portfolio.

07. BGF

BGF invests in SMEs in the UK and Ireland, across various industries and geographical areas. With a typical initial investment of $5 million and additional follow-up capital if needed, it offers between 10% and 40% of the company's stock in return. More than 100 of the portfolio firms of BGF (previously Business Growth Fund) have successfully exited, demonstrating its high success record.

Through at least 95 equity fundraising rounds, BGF has supported 72 forward-thinking businesses with headquarters in London. The fund provides access to a worldwide network of specialists and other investors in addition to growth financing. It also offers assistance with board strengthening, succession planning, and exit options.

08. MMC Ventures

Focusing mostly on the UK, MMC Ventures invests in disruptive technology firms. The fund may invest from pre-seed and assist startups through later-stage, although it generally invests between Series A and helps expand these enterprises. The investment group includes a number of well-known startups in its portfolio, including flower delivery service Bloom & Wild and market intelligence platform Signal AI. The group was an early investor in Gousto.

MMC has supported 51 businesses in London since 2011, participating in at least 91 equity fundraising events. With more than $1.2 billion under management across its many funds, the company has been investing since 2000. As part of the Greater London Investment Fund (GLIF—a fund of funds supporting SMEs in the Capital), it introduced a new £52 million seed fund in 2019 to assist small firms in the Capital.

9. Balderton Capital

Balderton Capital is committed to assisting innovative firms with international aspirations that were formed in Europe. Balderton Capital has worked with more than 200 entrepreneurs since its founding more than 20 years ago and has raised over $3 billion to invest in their firms. The fund has a long-term strategy, often investing between $1 million and $20 million in a company's early development stages and supporting them all the way through to exit.

Through at least 84 equity funding rounds since 2011, Balderton Capital has supported 41 high-growth firms with headquarters in London. With well-known brands including Revolut, ComplyAdvantage, Depop, Citymapper, and GoCardless, its portfolio is formidable.

10. Accel Partners

A US venture financing firm with a strong track record, Accel Partners has successfully funded companies like Slack, Bumble, and Deliveroo from the beginning. The fund has a significant worldwide footprint and is interested in many different tech areas, although it presently runs its European activities out of London.

Through at least 81 stock agreements since 2011, Accel has invested in 35 companies in London, including Hopin, Monzo, and the digital security firm Snyk. The fund contributes growth money and collaborates closely with companies to build their brands and increase their clientele.

11. Downing Ventures

Downing, a company that manages investments and provides business financing, invests in cutting-edge technology via its venture capital subsidiary, Downing Ventures. The worldwide portfolio of the fund includes investments in a variety of industries, such as deep technology, healthcare, education, e-commerce, and data analytics. It normally seeks to invest in EIS-eligible firms in rounds ranging from £500k to £5m.

Since 2011, Downing has participated in at least 70 equity rounds and funded 47 London-based firms. These companies include Hummingbird Technologies, Vivacity Labs, and Funding exchange, a manufacturer of drones. The fund collaborates with a variety of accelerator programs and investment partners, including the London Co-Investment Fund.