On 10th July, the Chancellor announced £400 million to help high potential diverse and underrepresented investors. This initiative will support emerging fund managers to develop the track record they need to become the investors of the future. The Chancellor also announced an additional £100 million in funding to be invested in women-led businesses.
- £400 million package to back investment fund managers from underrepresented backgrounds and drive growth as part of the government’s Plan for Change.
- Additional £50 million for female-led venture capital funds, doubling the British Business Bank’s commitment to £100 million and supporting the Invest in Women Taskforce.
Targeted at women, ethnic minorities, people with disabilities and those from deprived backgrounds, there will be a new £400m package from the British Business Bank starting in 2026, which will operate across three pillars:
- Back more diverse fund managers directly through the Bank’s Enterprise Capital Funds programme, the Bank’s scheme to support early-stage businesses with high growth potential.
- Invest more in supporting micro-funds, funds with around £10-15m and the first step on the venture capital ladder for new investors
- Back partners, such as venture capital funds, to invest smaller amounts in talented individuals to build a track record and to provide training, giving those without personal wealth or connections the opportunity to become investors.
Research shows just 2p of every £1 invested in venture capital funding in the UK goes to female-founded businesses and only 13% of senior individuals on UK venture capital investment teams are women.
This is exactly what our Plan for Change is about: breaking down barriers to opportunity and kickstarting the growth that creates jobs and puts money into people’s pockets across the UK.
This £500 million investment will back diverse and emerging fund managers, making our economy stronger and more dynamic.
Chancellor of the Exchequer Rachel Reeves
Announced last week at the Investing in Women Code’s report launch, this initiative aims to reduce the gender investment gap by helping emerging fund managers from diverse backgrounds, which will in turn build an ecosystem that makes more dynamic and inclusive investments.
The initiative will target at least 50% of investments going to female fund managers, who are statistically twice as likely to make investments in a women-led businesses.
In addition, this programme comes alongside a £50 million investment into female-led funds to support the aims of the Invest in Women Taskforce, taking the British Business Bank’s total commitment to £100m. The Taskforce has now secured over half a billion in funding to be invested in women-led businesses in the UK.
To deliver the government’s growth mission it is critical that our most promising entrepreneurs can access the finance they need to grow their businesses, no matter who they are or what their background is. The UK equity market currently experiences a significant funding gap for diverse founders, negatively impacting their ability to start a business.
This new £400m Investor Pathways Capital initiative will support diverse and emerging fund managers across the UK, in turn supporting talented entrepreneurs currently underserved by the UK equity market. It has the potential to unlock the UK’s full commercial potential and boost the UK economy.
Louis Taylor CBE, Chief Executive Officer, British Business Bank
We’re seeing real momentum in the number of women now shaping investment decisions, and the data shows this is directly linked to greater backing for female entrepreneurs.
That’s why programmes like the BBB’s new Investor Pathway Capital programme are so important and will help even more women break into Venture Capital. This is a core principle of the Invest in Women Taskforce – when you change who holds the capital, you change who gets funded.
Hannah Bernard OBE, Head of Business Banking, Barclays, and Co-Chair of the Invest in Women Taskforce
We welcome today’s announcements from the British Business Bank. Backing underrepresented fund managers and doubling support for female-led VC funds are vital steps toward a more inclusive investment ecosystem.
This year, in the Investing in Women Code report we saw that angel groups made more investment deals in all-female teams (42%) than in either mixed-gender or all-male teams – a powerful sign of change. These new initiatives will help build on that momentum, and work alongside more angel-backed innovation across the UK.
Jenny Tooth OBE, Executive Chair, UK Business Angels Association
About the British Business Bank
The British Business Bank is the UK Government’s economic development bank. Established in November 2014, its mission is to drive sustainable growth and prosperity across the UK and to enable the transition to a net zero economy, by improving access to finance for smaller businesses. Its remit is to design, deliver and efficiently manage UK-wide smaller business access to finance programmes for the UK Government.
The British Business Bank’s core programmes support over £17.4bn of finance to almost 64,000 smaller businesses.
As well as increasing the supply and diversity of finance for UK smaller businesses through its programmes, the Bank works to raise awareness of finance options available to smaller businesses. The British Business Bank Finance Hub provides independent and impartial information to businesses about finance options, featuring short films, expert guides, checklists and articles from finance providers to help make their application a success.
The British Business Bank is also responsible for administering the Government’s three Coronavirus loan schemes and its Future Fund, together responsible for delivering £80.4bn in finance to 1.67m businesses. These schemes are now closed to new applications.