BVCA ACCELERATE CONFERENCE 21-22 MAY 2024 BAFTA PICCADILLY

Our key takeways from the amazing British Venture Capital Association (BVCA) Accelerate Conference that took place last week at the BAFTA Piccadilly in London:

• Everyone is very bullish about UK Venture Capital, in particular about the potential of the Golden Triangle (i.e. Cambridge, London and Oxford Universities), the life sciences and technology sectors and the Regions (e.g. North of England).
• Exits are still difficult and discounts on valuations still exist.
• This is making it difficult for GPs to return cash to LPs.
• Which in turn is making it difficult for LPs to recycle cash into new fund commitments.
• Secondary funds are however booming! This includes in terms of fundraising, portfolio transactions and buyouts.
• There’s still a bit to do on Diversity and Inclusion (D&I) within the venture capital industry, with still low numbers of Female GPs.
• There’s a lot of excitement about the Investment Compact for Venture Capital & Growth Equity, which is a commitment by the industry to develop a long-term relationship with UK pension investors.
• In particular everyone is looking forward to defined contribution schemes being able to invest in venture capital funds.
• The industry seems to have cross-party support by both Conservatives and Labour, which abodes well for the new Government and the forthcoming UK general election.
• GPs need to focus more on DPI (Distributed to Paid-In Capital) and not hold on to assets for too long.
• A funding gap still exists in the UK for the financing of later-stage companies in particular at the Series C and Series D stages.
• That explains why some companies need to raise capital from US investors at that stage.
• But efforts are being made to resolve this situation (e.g. PISCES), including with the help of the British Business Bank (BBB).
• The UK has caught up with the US on tech talent, partly due to its great universities and spin-outs from existing unicorns.
• More success stories are therefore expected in the UK and Europe in the years to come.
• No one is really sure about the impact that AI will have on businesses but everyone is sure that the world will be different in 3 years time.
• AI development and AI deep tech is too binary and capital intensive for most investors.

If you wish to discuss any of the above, or are interested in investing in (or just curious about) UK venture capital, please feel free to contact us!