Key Takeaways
- • Scottish Widows is channelling workplace pension capital into British technology companies through a new venture growth portfolio within the CG Scottish Widows Growth Long Term Asset Fund (LTAF), part of its £3.7bn Scottish Widows Master Trust portfolio.
- • Aberdeen Investments, which manages the growth sub-fund, has appointed IP Group to manage the venture capital portfolio.
- • Initial venture investments are expected to include Oxford Quantum Circuits, Quantum Motion, Nyobolt and Genomics Limited, spanning quantum computing, ultra-fast-charging batteries and AI-driven healthcare.
- • The move follows Nest's initial £200m venture capital allocation managed by Schroders Capital, which it plans to lift to £1bn by 2030, and Aegon and NatWest Cushon's commitments to the British Business Bank's £200m British Growth Partnership Fund.
- • The mandate targets a shortage of follow-on funding for British businesses seeking to expand, giving defined contribution savers access to assets previously largely reserved for institutional investors.
Summary
Scottish Widows has announced plans to invest workplace pension capital in British technology companies through a new venture growth portfolio. Aberdeen Investments, which manages the growth sub-fund of the CG Scottish Widows Growth Long Term Asset Fund (LTAF), has appointed IP Group to manage the venture capital portfolio. The LTAF forms part of the £3.7bn Scottish Widows Master Trust's investment portfolio and the company's other workplace pension offerings.
Initial investments in the venture capital section are expected to include Oxford Quantum Circuits and Quantum Motion, both developing quantum computing technology, and Nyobolt, which specialises in ultra-fast-charging batteries. The portfolio is also expected to invest in Genomics Limited, which applies artificial intelligence, machine learning and genetic data to preventative healthcare and drug discovery.
The announcement follows similar moves by other defined contribution providers. In July, Nest announced an initial £200m venture capital allocation managed by Schroders Capital, with plans to increase this to £1bn by 2030. Earlier this year, Aegon and NatWest Cushon also committed capital to the British Business Bank's £200m British Growth Partnership Fund.
Scottlish Widows' mandate forms part of the fund's broader global private markets strategy and aims to address a shortage of follow-on funding for British businesses looking to expand. Nalaka De Silva, head of private markets solutions at Aberdeen Investments, said: "The UK has no shortage of scientific excellence and does not lack entrepreneurship or talent to develop globally relevant ideas. What competitive companies have lacked is sufficient pools of patient domestic capital to help them expand and grow. This partnership turns intent into investment."
Peter Fitzgerald, chief investment officer at Scottish Widows, said pension savers should benefit from growth and innovation across the UK, adding that the proposition connects workplace pension customers' long-term savings with high-growth British companies, giving them access to opportunities traditionally available mainly to institutional investors.
Initial investments in the venture capital section are expected to include Oxford Quantum Circuits and Quantum Motion, both developing quantum computing technology, and Nyobolt, which specialises in ultra-fast-charging batteries. The portfolio is also expected to invest in Genomics Limited, which applies artificial intelligence, machine learning and genetic data to preventative healthcare and drug discovery.
The announcement follows similar moves by other defined contribution providers. In July, Nest announced an initial £200m venture capital allocation managed by Schroders Capital, with plans to increase this to £1bn by 2030. Earlier this year, Aegon and NatWest Cushon also committed capital to the British Business Bank's £200m British Growth Partnership Fund.
Scottlish Widows' mandate forms part of the fund's broader global private markets strategy and aims to address a shortage of follow-on funding for British businesses looking to expand. Nalaka De Silva, head of private markets solutions at Aberdeen Investments, said: "The UK has no shortage of scientific excellence and does not lack entrepreneurship or talent to develop globally relevant ideas. What competitive companies have lacked is sufficient pools of patient domestic capital to help them expand and grow. This partnership turns intent into investment."
Peter Fitzgerald, chief investment officer at Scottish Widows, said pension savers should benefit from growth and innovation across the UK, adding that the proposition connects workplace pension customers' long-term savings with high-growth British companies, giving them access to opportunities traditionally available mainly to institutional investors.
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