Private Capital Update | Regional Investment Summit, Michael Moore in conversation with CMA, and FCA calls for greater investment in UK defence and security

EXTERNAL AFFAIRS:

BVCA highlights importance of boosting pension fund investment in VC to help science and tech businesses scale

BVCA Chief Executive Michael Moore called for urgency to make progress in increasing the pace of UK pensions investment into private capital at the Regional Investment Summit held in Birmingham this week. Addressing Business Secretary Peter Kyle at a roundtable with banking and asset management leaders, Michael stated that science and technology businesses need access to larger pools of domestic capital in order to scale.

Michael reinforced this message in conversations with the Chancellor and Pensions Minister at the same event, noting that just 0.007% of UK pension capital is directed to British venture capital funds.

During the event the Chancellor made a series of announcements designed to increase investment across the UK’s nations and regions. This includes Sterling 20, a new investor-led partnership between 20 of the UK’s largest pension funds and insurers. Participating firms are making commitments to invest in infrastructure and fast-growing businesses in key modern Industrial Strategy sectors like AI and fintech.

For more information about the BVCA’s government engagement, please contact Head of Public Affairs, Juliette Gerstein.

REGULATION:

Michael Moore underscores importance of competitive regulation in conversation with CMA chief

Michael Moore emphasised the importance of pace, clarity and proportionality in the work of the Competition and Markets Authority (CMA), during a fireside chat with the regulator’s Chief Executive Sarah Cardell, as part of the ongoing programme of engagement between the BVCA and the CMA.

Addressing over 100 CMA staff, Michael outlined the important role private capital has to play in driving growth and innovation in the UK economy, stating that targeted and timely action by the regulator can support in delivering that ambition.

Cardell agreed with this message, stating. “We want our markets to be open and competitive. We want the CMA to be seen as an enabler. Let’s continue working together on how the CMA can open up opportunities for growth and investment, and provide that positive impact through the work we do.”

Throughout the conversation, Michael and Sarah reflected on the broad programme of engagement between the CMA, BVCA and the private capital industry over the past 18 months, noting that continuing to build this dialogue was essential to shaping effective and informed regulatory policy.

If you have any questions about the BVCA’s engagement with the CMA, please contact Senior Policy Manager Ciaran Harris.

POLICY:

BVCA welcomes FCA call for greater investment in UK defence and security

Michael Moore, Chief Executive of the BVCA, has welcomed a speech by FCA Chief Executive Nikhil Rathi urging the UK’s financial services sector to support national defence and resilience, and confirming that there are no regulatory barriers to investment in these sectors.

Commenting on the speech, Michael Moore said “Enabling investment into the UK’s defence and security sectors is a vital national priority and opportunity. Private capital can be an important partner in helping to scale those innovative firms that are strengthening our national security and domestic economic growth.”

The Government’s Defence Industrial Strategy recognises that sustained private investment is critical to the UK’s defence ecosystem. It notes that crowding in private capital alongside public funding is essential to strengthen supply chains, scale innovative companies and drive technological competitiveness. The Strategy also commits to closer engagement between government, investors and industry to improve access to finance and create the conditions for long-term, sustainable investment.

For more information, please contact the BVCA’s Senior Policy Manager, Ciaran Harris.

POLICY:

BVCA welcomes Government plan to allow sandboxes to accelerate AI adoption

The BVCA welcomes new plans for AI Growth Labs which will provide innovative companies with the opportunity to test new AI technologies in real-world conditions, with some rules and regulations temporarily relaxed.

The announcement follows BVCA calls to introduce regulatory sandboxes where individual regulations are temporarily switched off in controlled testing environments to encourage the development of innovative technologies including AI.

Sandboxes have played an important role in establishing the UK’s status as a global hub for fintech and the BVCA believes their use can support the UK’s ambitions to be a leader in AI.

A recent report from the BVCA and Public First found that 91% of private capital investors agreed that a faster and more agile regulatory system would make it easier for them to invest in UK businesses.

For more information, please contact Senior Policy Executive, Olivia Green.

Insight

Unlocking Diverse Talent for a Stronger Economy

Authored by Breeze Haywood, Sustainability Policy Executive, BVCA

Breeze Haywood, Sustainability Policy Executive, shares insights from the BVCA’s recent Black History Month Reception. At the event, panel discussions explored existing gaps in the industry with regards to access to finance and career development opportunities. Panellists discussed how embedding DE&I into business and government policies can support innovation and economic growth.

The author outlines that DE&I presents a powerful opportunity for both business and the wider economy in achieving growth and equity.

Media: weekly digest

In the news this week, the FT covered Bank of England Governor Andrew Bailey’s appearance at the House of Lords select committee hearing on the growth of private markets. The Governor told the committee that the Bank will conduct a “system-wide exploratory scenario” to test how the private credit market would manage in a crisis. Michael Moore will provide evidence to the committee next week.

The FT also reported that Rachel Reeves has unveiled a “blitz on business bureaucracy” in a renewed push to cut red tape that she claims will save British companies nearly £6bn a year, alongside making the regime regulating mergers and acquisitions more transparent. Additionally, Insider Media reported that the Chancellor has announced a £500m investment package for new homes and stronger transport links between Oxford and Cambridge as part of a bid to create "Europe's Silicon Valley" in southern England.

Meanwhile, as mentioned in the story above, the Telegraph reported on Nikhil Rathi’s speech to City bosses where he argued they needed to step up their investment in Britain’s rearmament push.

Finally, the FT published a long read that argued private equity in Japan is in the ascendancy and the establishment is courting the PE firms to help shake up moribund corporates and spur industry consolidation.

To learn more about how the BVCA engages with the media, or about any of the above, contact the BVCA Press Office.

News

Financial Times:
Andrew Bailey warns ‘alarm bells’ ringing over private credit market

Financial Times:
Reeves launches ‘blitz’ on red tape in bid to save £6bn a year for UK business

Insider Media:
Reeves hails £500m package for homes and transport in Oxford-Cambridge corridor | Insider Media

The Telegraph:
City told to back rearmament by FCA

Financial Times:
Is Japan private equity’s next frontier?

Research: Weekly Digest

Increasing equity investment into UK spinouts supports growth and innovation
Beauhurst & Parkwalk Equity Investment into Spinouts Report 2025 highlights the growing importance of university spinouts in driving innovation and growth in the UK.

In 2024, spinout funding reached £3.35bn across 447 deals, with the average deal size rising to £7.49m—a sign of resilience amid economic and geopolitical challenges. It was also a strong year for first-time equity deals, which increased from £109m to £183m (91 deals). However, H1 2025 has not sustained this momentum.

In the past year, the majority of deals were concentrated in Life Sciences and Digital & Technologies, aligning with the UK Government's Modern Industrial Strategy to commercialise research in priority sectors.

The report also notes a significant increase in foreign co-investment (led by the USA and Europe) as the proportion of UK-only investor deals declined from 85.3% in 2015 to 60.6% in 2024.

Private capital at a glance

£3.35bn
Equity investment in UK spinouts in 2024

24.7pp
Decrease in UK-only equity investment into UK spinouts 2015-2024 (percentage points)

Source: Equity Investment into Spinouts Report 2025 | Beahurst & Parkwalk Equity

Learn more about how private capital is making a difference on the BVCA website.

Spotlight

Creating equity of opportunity

The 10,000 Interns Foundation challenges the underrepresentation of Black talent in the workplace, creating equity of opportunity through its internship programme, and equity of experience in the workplace for minoritised candidates through its training and mentoring.

Founded in 2020, it has helped to create over 10,000 paid internship opportunities across 35 sectors, partnering with leading businesses to level the playing field for Black talent and beyond.

The BVCA supports the 10,000 Interns Foundation, as its sole umbrella charity for events. The Foundation continues to champion equity and belonging, but sustained impact depends on collective commitment from the business community.

For more information and to donate to the 10,000 Interns Foundation, visit here.