News from our partners – Pentech announces £88m fund to invest in early stage software companies with global potential
Pentech has announced the closing of Pentech Fund III at an oversubscribed £88 million, exceeding the original target fund size of £70 million. The new fund, double the size of Pentech’s previous fund, will invest in early stage software companies across the UK.
Pentech, which has offices in Edinburgh and London, invests at series A and pre-series A. The Pentech team have a strong track record of working closely with founders to support them building and developing their businesses. Pentech’s main area of interest is discovering where new disruptive technologies, such as Artificial Intelligence, Machine Learning, Big Data and Infrastructure such as Blockchain and Microservices, can create category leading software companies in large industries, such as FinTech, health and wellness, and enterprise transformation.
Pentech has led investments in over 20 software companies, typically as the first institutional investor. The approach of providing both capital and support has helped FanDuel become the category leader in fantasy sports; Nutmeg to develop the leading wealth management platform in Europe; Outplay to create a leading mobile game development studio; and enabled Maxymiser to flourish from a UK focused business to an international success story with headquarters in New York before being acquired by Oracle. Other examples of successful outcomes include the sales of Acunu and Semetric to Apple and Struq to Quantcast. In each case, Pentech is proud to have worked with the founders and their management teams to help them achieve their ambitions.
Fund III investors include the British Business Bank – which is making a significant contribution under its Enterprise Capital Funds (ECF) programme – and existing Pentech investors, together with new European family office investors and UK pension and endowment funds.
Pentech plans to construct a portfolio of around 20 companies over the next five years out of its new fund.
Eddie Anderson, General Partner, Pentech, said: “We are passionate about working with entrepreneurial founders and teams to help them build category leading businesses. We love to work with founders who have a combination of global ambition, complete dedication to their mission and a true grasp of the realities of how to build businesses in a capital efficient manner. Working with software companies at an early stage is our sole focus, directly supporting teams in each aspect of their business. We are excited to continue our journey and are grateful to the existing and new investors who have supported us.”
Nick Hungerford, Founder of Nutmeg, said: “Pentech is a rare breed of VC, no fuss, no credit required; just all action and steady support. Every start-up has ups and downs and the Pentech team’s unwavering encouragement, clear direction and, most importantly, faith in the entrepreneurs they back is empowering, enabling and clear for all to see. Pentech is most definitely “smart money”, the teams they champion tend to grow into successes, and that they are involved is no coincidence.”
Keith Morgan, CEO, British Business Bank, said: “ The new Pentech Fund III will provide welcome new equity funding to early stage software companies in the UK. Helping innovative businesses like these to scale up is important for the continued development of the UK tech sector and we are therefore pleased to be supporting Fund III as part of our ECF programme, which now has a total investment capacity of £950m.”
Pentech is a leading UK VC investor, having been actively investing in early stage software companies since 2001. Its latest fund, Pentech Fund III, was launched in May 2017 and will invest in early stage software companies throughout the UK. The Pentech partners have gained considerable experience in founding, developing and exiting software businesses, both in Europe and in the US. Pentech utilises the experience of its team to identify early stage software opportunities with global potential, and to work with these companies to prove the value of their offering, and then grow them into market leadership positions. Pentech is authorised and regulated by the Financial Conduct Authority. For further information, see www.pentechvc.com
Contacts: Eddie Anderson, +44 (0)7980 736053; Craig Anderson, +44 (0)7545 923494
About British Business Bank
The British Business Bank is the UK’s national economic development bank. Established in November 2014, its mission is to make finance markets for smaller businesses work more effectively, enabling those businesses to prosper, grow and build UK economic activity. Its remit is to design, deliver and efficiently manage UK-wide smaller business access to finance programmes for the UK government.
The British Business Bank is currently supporting over 54,000 businesses, working through its 90 finance partners. Its programmes support over £3.4bn of finance to UK smaller businesses and participate in a further £5.1bn of finance to UK small mid-cap businesses.
British Business Bank plc is a limited company registered in England and Wales, registration number 08616013, registered office at Foundry House, 3 Millsands, Sheffield, S3 8NH.
The Enterprise Capital Funds programme operates under British Business Finance Limited, a wholly owned subsidiary of British Business Bank plc, registered in England and Wales, registration number 09091928, registered office at Foundry House, 3 Millsands, Sheffield, S3 8NH. It is not authorised or regulated by the PRA or FCA.
As the holding company of the group operating under the trading name of British Business Bank, it is a development bank wholly owned by HM Government which is not authorised or regulated by the Prudential Regulation Authority (PRA) or the Financial Conduct Authority (FCA). The British Business Bank operates under its own brand name through a number of subsidiaries, one of which is authorised and regulated by the FCA.
British Business Bank plc and its principal operating subsidiaries are not banking institutions and do not operate as such. A complete legal structure chart for British Business Bank plc and its subsidiaries can be found on the British Business Bank plc website.