Private equity and venture capital; key players in your constituency

Dr Martens. Revolut. Skyscanner. Kurt Geiger. B&M.

Successful businesses you will know. But businesses that you may not know are successful because of support from private equity and venture capital.

Underpinning their success is private capital’s philosophy of working in partnership with founders and entrepreneurial management teams, providing not only the capital, but also the hands-on expertise and long-term approach that enables companies to innovate and grow.

But for every high-profile business you know that is backed by private capital, there are many hundreds, if not thousands, of other unsung heroes – developing strongly in towns and cities all over the United Kingdom, providing the backbone for local growth and prosperity.

A recent study produced by EY for the British Private Equity and Venture Capital Association (BVCA) – the industry’s representative body – found that nearly 10,000 UK companies are supported by private equity and venture capital, backing nearly 2 million jobs and generating over £100bn in GDP, or 5% of the UK total.

PE and VC at work in your constituencies

Those 2 million jobs, or 6% of the total jobs in the UK, generate earnings of £58bn for the employees and are found all across the country, not just in London and the South East. In every region and nation you will find people employed in businesses backed by private capital – including 171,000 in the North West, 133,000 in Scotland, 127,000 in the Midlands and 118,000 in the South West. That is the industry at work, supporting your constituents, right on your doorstep.

Some of the businesses are large high street names, finding a new lease of life and refreshed purpose through private capital backing. But others are university spin-outs, start-ups, and family-run businesses that have potential for exceptional growth. Indeed, private capital is heavily invested everywhere in creating a better future for Britain’s small and medium sized enterprises – 9 in 10 companies supported by the industry are small or medium sized, employing 250 or fewer people.

These are companies like Xampla – based in Cambridge – that produce natural alternatives to single-use plastics, Nova Pangaea Technologies – based in Teesside – that turns unwanted biomass into sustainable aviation fuel, and Neurovalens – based in Belfast – that creates non-invasive neurostimulation products used to solve some of the world’s greatest health challenges.

As these examples highlight, private equity and venture capital firms cover the last mile between UK financial services and the real economy up and down the country – they are invested in growth, innovation and people. And through active ownership of businesses they deliver long term growth, which is the key metric of success for the industry.

Parliamentary reception

These themes were at the heart of the many lively discussions at our recent parliamentary reception. It was encouraging to see so many parliamentarians meeting representatives from companies like these, alongside their private capital backers.

If you missed it, but want to find out more about private capital at work in your nation, region or constituency, or to visit a private equity or venture capital-backed business there, please contact the BVCA at ExternalAffairs@bvca.co.uk