The British Business Bank has driven more than £600m into the country’s fastest-growing science and technology scale-ups, more than doubling its direct equity activity in the space of nine months as it moves to close one of the most persistent gaps in British finance.
The state-owned bank has now backed more than 50 high-growth companies directly, up from 31 in March 2025, and has invested more in the last nine months than in the previous four years combined. The total deployed has climbed from £290m last October to north of £600m today.
It is a deliberate change of gear. The Bank has stepped up the pace and scale of its direct equity investing to tackle a long-standing weakness in the UK’s late-stage capital market, the point at which promising firms have historically been forced to look to American or Asian investors, or to relocate altogether, in order to keep growing. The ambition now is to help the best of them scale up and stay put.
The Bank made its first direct equity investment, into data analytics firm Quantexa, back in 2020. Five years on it has assembled a portfolio spanning life sciences, deeptech and advanced manufacturing, clean energy, defence, artificial intelligence and fintech, establishing itself as one of the most active late-stage investors in the sectors expected to define the UK economy over the coming decade.
The numbers behind the acceleration are striking. In the 2025/26 financial year the Bank completed 18 new investments alongside 18 follow-on deals, compared with 12 investments the year before. Total investment rose two and a half times, from £75m to £188m year on year, and is expected to scale beyond £400m this year.
That trajectory builds on a wider recovery at the institution. The Bank recently returned to profit with a £144m gain and an expanded investment remit, giving it the balance-sheet firepower to write bigger cheques more often.
For Leandros Kalisperas, the Bank’s Chief Investment Officer, the message to the wider market matters as much as the money itself.
“Supporting UK scale-ups is a national economic imperative,” he said. “The UK excels at creating businesses, but our domestic capital base has yet to match our scientific excellence. Our activity should be interpreted as a clear signal to UK institutional capital that we want them to join us in backing UK scale-ups. We now have fuel in the tank and intend to put UK innovation in fifth gear.”
It is a pointed intervention. British pension funds, sitting on some £3 trillion of assets, have long allocated only a sliver of that capital to growth-stage British equity, a mismatch that has become a recurring theme in the debate over Britain’s real scale-up crisis. By putting its own capital to work at speed, the Bank is hoping to crowd in the private money that has so far stayed on the sidelines.
Charlotte Lawrence, Managing Director and Head of Direct Equity at the British Business Bank, framed the strategy as one of leverage rather than crowding out. “We are accelerating our ambitions to match the calibre of UK innovation,” she said. “By investing £400m per year into the most exciting venture-backed UK scale-ups across life sciences, deep tech, AI and fintech, we aim to act as an ecosystem multiplier and ensure the most innovative UK businesses have the capital and support to rapidly scale.”
The push sits squarely within the Government’s modern Industrial Strategy, and ministers are keen to claim it.
Business Secretary Peter Kyle said the Government was “ramping up the pace and scale of investment, backing the UK’s highest-growth scale-ups at a level not seen before, through our modern Industrial Strategy. By more than doubling investment in just nine months, we’re giving firms the firepower they need to stay and scale here in the UK and drive the economy.”
The latest figures are a down payment on a far larger plan. Under its five-year strategic plan to transform small business finance, the Bank aims to build deeper pools of scale-up funding by mobilising institutional capital at scale and supporting the launch of larger, growth-stage funds.
Its investment arm is expected to deploy around £2bn a year into the UK venture capital ecosystem, with roughly 20 per cent, or £400m, earmarked for direct equity. On current plans that translates into 14 to 18 new investments a year, with initial cheques typically ranging from £10m to £40m and long-term cumulative commitments of up to £75m per company.
Whether that is enough to keep Britain’s brightest companies anchored at home will depend, in large part, on whether the private capital the Bank is trying to summon decides to follow it onto the pitch.
