4 Early Stage UK VC Firms You Should Know About
The UK attracts more tech investment than anywhere else in Europe. Figures gathered by Dealroom and London & Partners show that tech firms based in London alone raised $19.8 billion in 2023, which was significantly higher than investment racked up by another European city. In all, UK tech firms secured $22.9 billion in funding, making this the world’s third biggest country for tech investment, just behind the US and China.
What’s more, as Andrew Williamson of Cambridge Innovation Capital recently noted in an interview with Sifted, “venture investment as a percentage of GDP is broadly similar now in the UK to the US, and far ahead of everywhere in Europe except for Israel”.
So what are some of the leading VC firms in the UK, from the point of view of founders seeking early stage capital? Here’s a handful that have been backing exciting startups both here and globally.
7percent takes its unusual name from the wise words of Y Combinator co-founder Paul Graham. “A good early stage growth rate is 5-7% a week. If you can hit 10% a week you’re doing exceptionally well, but if you can only manage 1%, it’s a sign you haven’t yet figured out what you’re doing.”
The firm is open to super early stage startups, even those still on the drawing board, as long as they aim for real disruption rather than “simply iterating a market”. In other words, 7percent favours founders who are willing to take risks to create “the technologies and products that in ten years people will wonder how the world ever lived without.”
Its founders, Andrew B Gault and Andrew J Scott, are veteran innovators in their own right, with numerous patents and startups under their belt, including one of the earliest social network platforms back in 2001.
Example company in portfolio: Bunch.ai
Bunch is an AI-powered app that offers quick leadership coaching to executives. It utilises psychometric profiling and curated insights from business experts to help users build their leadership skills. Its bold claim is that using the app just two minutes per day can genuinely increase workplace effectiveness and even promotion prospects, and more than 72,000 senior level managers have already used it.
A VC firm specialising in backing impact tech, 2150’s name can be explained by its catchy mission statement: to “make the world of 2150 one we actually can and want to live in.”
The firm looks for businesses that are changing the landscapes and infrastructures of our cities, what it refers to as the “urban stack”. Funding is awarded to founders of “rebellious spirit and unflinching resilience”, who are looking to “leverage structural shifts, kill inefficiencies, remove pain points and enhance environmental upside.”
2150’s co-founders include Christian Joelck, who helped create an organisation which lobbies for climate conscious policy changes in Europe, and Mikkel Bülow-Lehnsby, a real estate entrepreneur with a long-held interest in sustainable buildings and communities.
Example company in portfolio: Normative
Cloud software company Normative bills itself as the world’s first carbon accounting engine. It allows businesses to accurately calculate their climate footprint, processing client data through its proprietary data model, and providing guidance on how companies can chart a path to net zero. Discussing their backing of Normative, 2150’s Jacob Bro and Rahul Parekh highlighted how, with measuring emissions becoming a crucial KPI for stakeholders, carbon accounting is set to “emerge as the first truly global software vertical in the climate tech domain.”
Concept has a significant claim to fame, being the largest dedicated UK pre-seed fund. Partner Jeff Chowdhry launched and managed the world’s first ESG emerging markets fund and brings his interest in sustainability to bear on the investments made by Concept.
The firm is proud of its allegiance to bold new startups, stating that “most investors are sheep. Group think and bias often lead to the same people getting funded.” The firm values complete transparency, and clearly lays out every aspect of its investment process in documents available to download from its website. This may well bring an extra level of reassurance to entrepreneurs who may be new to the investment process, and are understandably daunted by such a pivotal chapter in their journey.
Example company in portfolio: ElevenLabs
ElevenLabs is one of the big pioneers at the forefront of the AI revolution, creating uncannily life-like text-to-speech and generative voice AI software. Clients can input any text they like, select the kind of voice they want, and instantly have human-sounding voice overs for any project they have in mind. It’s even possible to clone your voice and hear yourself speaking in other languages – a mind-boggling advance in AI tech.
Fintech-focused VC firm Anthemis was founded by one of the most lauded and high-achieving women in the tech and media landscapes. Amy Nauiokas has numerous accolades to her name, and has been named in power lists published by the likes of Forbes, Entrepreneur Magazine and Variety. The latter can be explained by the fact that, as well as being a tech investor, Nauiokas is also the founder of Archer Gray, the media production company behind a string of award-winning movies and TV shows.
Anthemis aims to cultivate companies that can positively impact the financial system by promoting diversity, inclusivity, and digital innovation. In 2023, its Female Innovators Lab Fund became the largest early-stage fintech fund exclusively focused on companies founded by women.
Example company in portfolio: alt.bank
A quintessential target for Anthemis, alt.bank is a platform which aims to lower barriers to the global financial system by serving the world’s “unbanked and underbanked”. Operating in Brazil, the company kicked off with an app that’s accessible to those who can’t read, guiding users through banking transactions with colour-coded prompts. The bank also pays commissions to customers for referrals, and – according to its founder – places its “social mission” at the top of its priorities.