Luke Johnson of Risk Capital Partners gives his view on the BGF: “It’s a fairly crowded space. There’s no shortage of funds offering £1m to £10m of equity – there must be at least 50 firms, and a £2.5bn fund will distort the market. It will lead to softer terms being offered to businesses and I don’t think that government-backed banks like HBOS should be competing against us in this sector. The money should be used to beef up venture capital and support emerging businesses, instead of filling a gap that doesn’t exist. Meanwhile the BGF has been spending like a drunken sailor, opening offices all over the place and paying investors huge sums. People have been recruited from the wrong end of the market – mid-market firms. It’s a scam. It looks like it’s helping SMEs but it’s a mid-market private equity fund. In years to come, when investors are being interviewed by a select committee, they will say that the BGF didn’t turn out as planned. Actually the BGF is doomed from the start.”
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.