The UK’s Bethnal Green Ventures (BGV) has been bought by socially conscious asset manager Connected Asset Management in a deal that will allow tech for good startups to tap into the financial heft of pension funds.
The VC will however remain an independent brand as it scales its technology-for-good investment strategy. The tie-up provides an opportunity to meet the growing demand for impact investment from pension funds. Impact investing usually refers to investing in companies aiming for both financial returns and a positive environmental or environmental impact.
This deal will allow pension funds to take advantage of the high-growth opportunity to invest in British tech startups with clear and measurable social and environmental impact. Furthermore, Connected also plans to deliver investment solutions to deploy capital towards assets including, microfinance, social housing and clean energy.
Connected manages assets for Smart Pension, a UK occupational pension scheme. Through Smart Pension, future pensioners can have exposure to equities and bonds through funds managed by companies like JP Morgan, and now they’ll have access to VC as well.
Founded by Paul Millers in 2012, BGV invests in founders using technology to create a positive impact at scale. Its investments include sustainable smartphone Fairphone, patient platform DrDoctor, and Organise, the campaigning platform for better work conditions, while Connected too is at the forefront of ESG solutions for pension funds.
A British Business Bank report found that if pension savers invested in high-potential startups via venture capital, returns for the average 22-year-old pension saver could increase by between 7-12% and there were also potential gains for older savers, suggesting a 45-year-old with a £50,000 pot could expect to see between 6-7% increases.
Connected founder Darren Agombar said, “Venture capital and growth equity is transforming society and building the high growth companies of the future. By bringing BGV into the Connected group, pension savers can now also benefit from the high returns that investing in these firms can offer over the longer term whilst helping to deliver positive social and environmental change.”
Miller added, “By creating better solutions to big social and environmental challenges, tech for good businesses tap into huge market opportunities, benefitting people and the planet at scale while also making fantastic returns. More and more investors are recognising this opportunity, especially in London, which is the top global hub for tech for good with VC investments into the space increasing exponentially in recent years.”
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