DRAGON LAUNCHES $100M FUND TO ACCELERATE UNICORNS

Dragons’ Den star Steven Bartlett has announced the launch of his new $100m Flight Story Fund, with the mission of accelerating the next generation of European Unicorns. Capital markets, and in particular private equity, took a huge hit in 2022. The launch of the Flight Story Fund has been timed to exploit the dislocation and disruption in the economy.

A study, commissioned by the Venture Capital Trust Association (VCTA), among 240 senior decision makers in charge of recently launched small businesses less than seven years old and employing up to 250 employees, reveals a strong appetite for growth despite the economic challenges facing the country. An overwhelming majority (92%) of respondents said they are likely to consider raising equity through a Venture Capital Trust.

In a clear sign that businesses of this type are pursuing a pro-growth agenda, the most popular reasons for requiring equity finance are to invest in R&D (48%), new technology (45%), and equipment and machinery (42%).

Over a third (36%) plan to use the funding to hire new talent and around a quarter (23%) to launch a new product or service. Just 17% of respondents said the fresh capital would be needed to improve their cash flow, which can be a sign of distress.

Over the last financial year, VCTA-backed businesses delivered £12.5bn in revenues, generating £3bn in exports and investing £548m in R&D. Over 75% of post-2015 VCT investee companies have invested in R&D.

Will Fraser-Allen, Chair of the VCTA, commented: “It’s encouraging to see such a strong level of demand for equity capital among early-stage businesses across all parts of the country.

“That businesses plan to deploy new capital to fund areas such as R&D, new technology and recruitment speaks to their pro-growth mindset. With the UK facing an uncertain future, their contribution is particularly important as many larger companies are under pressure to reduce costs and shelve investment plans.

“Young businesses, run by entrepreneurs with ambitious expansion plans, are supporting the health of our economy. We strongly believe that VCTs are ideally placed to continue funding this growth.”

Powered by Bartlett and other successful entrepreneurs, the Fund will be targeting individual investments between $1m-$10m in high-growth companies in six emerging categories – blockchain, biotech, health & wellbeing, commerce, technology and space