The VCTA has welcomed the publication of the Future of Growth Capital report, which makes several important recommendations to address the UK’s growth capital gap and to support and champion more consistent regional growth.
The report, led by The ScaleUp Institute and Innovate Finance, notes the importance of VCTs as the “cornerstone of early-stage growth capital and follow-on funding”.
Commenting on the report, Chair of the VCTA, Stuart Veale, said:
“Entrepreneurs throughout the UK require an urgent solution to the funding challenges facing the future prosperity of growth companies. This report highlights that to deliver this support quickly, we must build upon existing frameworks that can deliver regionally-focused, patient capital – the VCT industry will fully support this vital work.”
As well as highlighting the contribution of VCTs, the report highlighted constraints on the flow of growth capital to UK SMEs resulting from regulatory barriers, such as “rules that limit their follow-on funding ability with existing portfolio companies which necessarily impedes the ability for businesses to scale with their existing investor base.” The report recommended regulatory change to increase the flow of growth funding.
The full Future of Growth Capital report can be found here.