News

Sure Valley Ventures launches £95m UK Software Venture Capital Fund with £50m investment from the British Business Bank’s Enterprise Capital Funds programme

  • Sure Valley plans to expand its London and Cambridge presence with a new office in Manchester to invest in disruptive software innovation across the UK.
  • Lord Gerry Grimstone, Minister for Investment at the Department for International Trade and the Department for Business, Energy and Industrial Strategy, endorses Sure Valley Ventures’ plans to increase investment into the Regions

02 March 2022: Sure Valley Ventures, the founder-led Venture Capital (VC) firm that invests in high growth software companies in sectors such as the Metaverse, Artificial Intelligence (AI) and Cybersecurity, is pleased to announce that it has completed an £85m first close of a £95m UK software technology fund. This includes a cornerstone £50m investment from the British Business Bank through its Enterprise Capital Funds (ECF) programme, which aims to increase the supply of equity capital to high-potential, early-stage UK companies.

Sure Valley is a seed capital investor in software companies that are focused on bringing a disruptive innovation to market. It plans to invest into 25 software companies from across the UK through its new fund. Currently based in London, Dublin, and Cambridge, the Sure Valley team will also be opening an office in Manchester to help access deals in the significant and exciting innovation clusters that have developed around creative technologies in the North of England and in the Metaverse and AI opportunities in cities such as Manchester, Leeds, Sheffield and Newcastle. The first investment from the Fund will be into a Belfast-based company, and the new office is expected to allow better access for Sure Valley’s team to proactively reach out to the creative and innovation clusters in Scotland and Northern Ireland.

Sure Valley Ventures Managing Partner and Co-Founder, Barry Downes, said, “We are delighted to partner with the British Business Bank and existing and new investors on this new £95m UK software technology Fund. We are excited to expand on our existing London and Cambridge hubs, by opening a new office in Manchester. Many cities, including Manchester, as well as Leeds, Sheffield and Newcastle, have become dynamic tech hubs for start-ups. As entrepreneurs and founders ourselves, we have been on the other end of the table and therefore understand the challenges that start-ups face for funding. A local presence will ideally position us to execute on exciting deals in this region and we are always willing to travel across the UK to meet exceptional leaders, to invest in their businesses and help them scale and grow in international markets.”

Ken Cooper, Managing Director, Venture Solutions, British Business Bank said: “The British Business Bank’s Enterprise Capital Funds programme plays a significant role in developing and maintaining effective venture capital provision in the UK, lowering the barriers to entry for emerging fund managers and for those targeting under-served areas of the market. Our cornerstone commitment to Sure Valley will support investment into high potential, early stage software companies that are leading change in the disruptive tech sector, across the UK.”

Minister for Investment, Lord Gerry Grimstone, said: “The AI and immersive tech sectors are major British success stories and investments like this one by Sure Valley Ventures ensures that early stage companies in the Northern Regions can access the funding necessary to help them compete at the forefront of global innovation.

“It’s fantastic to see this investment into the North of England which demonstrates the U.K.’s investment attractiveness as we continue to level up all parts of the UK.”

The sectors that Sure Valley Ventures invest in have significant growth potential over the next few years, for example Goldman Sachs and Morgan Stanley are predicting that the Metaverse could be an $8 trillion opportunity[1]. In addition, the Cybersecurity market is due to grow to $203 billion by 2027 according to Market Watch[2]. Sure Valley has established a strong track record in these sectors, having invested in them since the firm’s inception in 2017 through investee companies including Getvisibility, Smarttech, Nova Leah and Precog Systems in the security space, Engage XR, War Ducks, Admix, Volograms, VividQ and Virtex in the Metaverse sector and Cameramatics, Artomatix and Ambisense in the AI sector.

Alongside the equity invested, Sure Valley supports entrepreneurs via its value-adding Platform, which draws on the team’s knowledge and experience as founders to create a programme which is tailored to each investee company’s individual needs. Sure Valley’s platform also features a global network of advisors, based in leading innovation hubs across the globe, including San Francisco, Silicon Valley, New York, LA, Austin and Seattle in the USA as well as leading European and Asian hubs.

Sure Valley has had success helping its investee companies grow and scale from Seed to Series A, and beyond with 93% of its investee companies raising follow-on Series A or B rounds within 24 months of the initial seed investment. This is a notable result, considering that on average 48% of companies fail to raise a follow on investment round at all, according to CBInsights[3]. In addition, many of Sure Valley’s current portfolio have gone on to further successes, including to IPO, e.g. Engage XR – a leading corporate metaverse company and Smarttech 247 – an AI-based cybersecurity company that plans to IPO in Q2 2022.

ENDS

For further information, please contact:
SEC Newgate – Isabelle Smurfit and Elisabeth Cowell,
shardcapital@secnewgate.co.uk
+44 (0) 20 3757 6882

Notes to Editors

About Sure Valley Ventures:

Sure Valley Ventures is focused on investing in disruptive software innovation at the seed stage in sectors such as the Metaverse (e.g. Augmented Reality (AR), Virtual Reality (VR) and Web 3 decentralized technologies), Artificial Intelligence (AI) and Cybersecurity. We look for companies which have exciting potential to disrupt industries and scale up, and in doing so, deliver robust returns for the economy and society at large, the founders and their team and of course Sure Valley and our investors.

Typically, Sure Valley initially invests in the range of £750,000 to £1,500,000 and will often bring in co-investors to complete total investment packages of £1 million to £3 million in new companies.

Our Fund I highlights include:

  • A successful metaverse exit with the IPO of Engage XR (formerly VR Education)
  • 93% of investee companies raised follow-on Series A or B rounds within 24 months of initial seed investment (on average 50% of companies fail in this transition according to data)
  • Upcoming IPO of AI-based cybersecurity company, Smarttech 247

We have identified the following emerging market segments as areas of focus over the next 12 months and beyond:

  • Metaverse and Immersive Technologies
  • Software Security
  • Artificial Intelligence

More information on our investment outlook can be found here.

Sure Valley Ventures was founded in 2017 with support from Shard Capital, the leading wealth and asset manager. It currently has offices in London, Dublin and Cambridge.

About the British Business Bank:

The British Business Bank is the UK government’s economic development bank. Established in November 2014, its mission is to drive sustainable growth and prosperity across the UK, and to enable the transition to a net zero economy, by improving access to finance for smaller businesses. 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’s core programmes support over £8.5bn[1] of finance to almost 95,000 smaller businesses[2]. The British Business Bank is responsible for running the government’s Coronavirus business loan schemes and Future Fund, together responsible for delivering £80.4 bn of finance to 1.67m businesses. The schemes are now closed to new applications.

As well as increasing both supply and diversity of finance for UK smaller businesses through its programmes, the Bank works to raise awareness of the finance options available to smaller businesses. The British Business Bank Finance Hub provides independent and impartial information to businesses about their finance options, featuring short films, expert guides, checklists and articles from finance providers to help make their application a success. In light of the coronavirus pandemic and EU Exit, the Finance Hub has expanded and it now targets a wider business audience. It continues to provide information and support for scale-up, high growth and potential high growth businesses, but now provides increased content, information and products for businesses in survival and recovery mindsets. The Finance Hub has been redesigned and repositioned to reflect this, during this period of economic uncertainty.

British Business Bank plc is a public limited company registered in England and Wales, registration number 08616013, registered office at Steel City House, West Street, Sheffield, S1 2GQ. It is a development bank wholly owned by HM Government. British Business Bank plc and its subsidiaries are not banking institutions and do not operate as such. They are not authorised or regulated by the Prudential Regulation Authority (PRA) or the Financial Conduct Authority (FCA). A complete legal structure chart for the group can be found at www.british-business-bank.co.uk

The investment from British Business Bank to Sure Valley does not amount to any endorsement or warranty from the British Business Bank plc, or the government of the UK.

Enterprise Capital Funds are administered by British Business Finance Ltd, a wholly owned subsidiary of British Business Bank plc.

[1] Goldman Sachs Sees the Metaverse as $8 Trillion Opportunity – Metaverse Bitcoin News

[2] Cybersecurity Market 2022 : CAGR Status, Detailed Analysis of Top Manufacturers, Competitive Landscape and Future Dynamics till 2027 with Dominant Sectors and Countries Data – MarketWatch

[3] The Venture Capital Funnel (cbinsights.com)

[1] Figures as at 31 March 2021

[2] Figures as at 31 March 2021