Investment giant BGF has revealed plans to raise external funds for the first time.
The organisation said the move would enable institutional investors the opportunity to invest in UK growth companies through BGF’s regional platform.
Lazard has been appointed to advise BGF as it explores its options while no indication has been given on how much it is seeking to raise.
BGF’s portfolio includes the likes of Brompton, Christopher Ward, Giggling Squid, Gousto and Seasalt.
It has previously backed companies such as Furniture Village, Kids Planet, St Pierre Groupe and The Coaching Inn Group.
BGF has delivered a 21.4 per cent internal rate of return since 2016, investing over £4.7bn in over 600 businesses.
BGF in the ‘early stages’ of capital raise
Andy Gregory, CEO of BGF, said: “The case for supporting this country’s ambitious entrepreneurs is clear and one recognised by government as a priority.
“Over the past decade, we’ve proudly backed hundreds of founder-led businesses, supporting them with the capital and expertise they need to scale and succeed.
“These companies are the backbone of our economy, and it is vital that they receive not only funding but also the support required to thrive.
“We are now in the early stages of exploring a capital raise that could unlock further sources of funding into this crucial segment of the UK market.
“We know that institutions such as pension funds are keen to work to the Mansion House Accord, channelling long-term institutional capital into UK growth companies.
“Thanks to the continued support of our shareholders, we have the platform, the capacity and the proven expertise to be the partner of choice for investors looking to back ambitious businesses.
“As part of our £3bn commitment have the capacity to take on £500m from institutional investors over the course of 2026.”
Profit almost doubles after successful exits
The news comes after City AM reported in June that profit at BGF had almost doubled thanks to a series of successful exits in 2024.
The organisation reported a pre-tax profit of £131.1m for its latest financial year, up from the £67.9m it achieved in 2023.
Accounts filed with Companies House also showed its investment income rose from £104.8m to £120m.
In May, BGF unveiled a £3bn commitment to back British businesses over the next five years which includes £500m earmarked for early stage start-ups in deep tech and life sciences.
BGF was founded by Barclays, HSBC, Lloyds Bank, the Royal Bank of Scotland and Standard Chartered.
It has offices in Aberdeen, Belfast, Birmingham, Bristol, Cambridge, Cardiff, Cork, Dublin, Edinburgh, Leeds, London, Manchester, Newcastle, Nottingham and Reading.