Northern Triangle tech start-ups should be prime targets for Square Mile investors

THE recent report by the Treasury Select Committee on the UK's Venture Capital industry should ring alarm bells for the City. The Committee found that for many British businesses wishing to grow their operations beyond the early funding stages, access to UK domestic capital has been a barrier. As I said in my evidence to the Committee, this often leads to UK firms looking overseas for funding. Alongside a range of concerning findings over diversity in the sector, the report also highlighted a lack of venture capital investment outside London and the South East.

This means that throughout most of the UK regions and nations, opportunities for investment in high-growth businesses are more limited than they ought to be. This may be undercutting the potential for economic growth across the country. Part of the reason for this is that the company age limit for tax relief schemes puts companies

Nicholas Lyons

outside London, which typically take longer to launch, at a disadvantage.

The City of London Corporation stands firmly behind the findings of this vital report, which emphasises the crucial question of how capital is deployed across the UK.

In the last few days I have been visiting businesses and universities in Leeds and Sheffield. Leeds is a leading financial and professional services hub, while Sheffield is a centre for advanced manufacturing and energy research. The so-called Northern Triangle tech start-ups – those based in Leeds, Sheffield and Manchester – have raised £1.3bn in funding over the last five years. The advances made in Leeds made it a logical place to play host to the launch of the Centre for Finance, Innovation and Technology in February this year.

Firms in the Northern Triangle are a perfect example of the UK’s ability to get start-ups off the ground whilst lacking the deep pools of later-stage venture capital businesses need to accelerate.

The City of London should be able to help thanks to the newly signed Mansion House Compact, which saw nine chief executives from some of the UK’s largest defined contribution (DC) pension schemes commit to allocating at least 5 per cent of assets to unlisted equities by 2030 – unlocking £50bn by the end of the decade. The signatories – Aviva, Scottish Widows, L&G, Aegon, Phoenix, Nest, Smart Pensions, M&G and Mercer – represent around twothirds of the DC market.

They will invest into tech, life-sci- ences and bio-tech companies via existing investment vehicles or new ones to boost returns for pension savers and support the development of high growth firms.

The UK must make best use of its pools of capital to back innovative and dynamic homegrown businesses, which will form the future of a successful UK economy, and to make British ownership an attractive option. The Mansion House Compact promises to be a pivotal step towards this goal, fostering increased investment in growth companies across the UK while benefiting savers nationwide. Addressing the barriers to access to capital will also be essential to promote inclusivity, empower diverse entrepreneurs, and unlock the full potential of all the UK's regions. That is where venture capital must venture further.

£ Nicholas Lyons is lord mayor of the City of London Corporation a growing sense, particularly but not only among Conservative voters, that Natwest had got this wrong, seeming to want to “de-bank” public figures because it disliked their views, rather than for financial or administrative reasons.

There is growing fatigue at the automatic injection of identity politics into every issue in the media. The treatment of Dame Alison is not unprecedented: last year, the transport secretary, Grant Shapps, called for the resignation of Peter Hebblethwaite, CEO of P&O Ferries over the unlawful dismissal of 800 employees without consultation. Shapps may be a smaller fish than Hunt or Sunak, but the government had the right, if only as shareholders, to express a view on Coutts and Farage.

Reeves was finally undermined when the leader of the opposition, Sir Keir Starmer, acknowledged that Natwest had “got this one wrong, and that’s why Alison Rose had to resign”. He even expressed muted sympathy for Nigel Farage.

Inevitably Reeves was guilty of bad political judgement and a victim of bad luck; she could not have foreseen the speed at which Rose’s position would unravel, but she made a misjudgement in choosing her line of attack and choosing to go in hard. Nigel Farage vs a female-led, partially public-owned bank must have seemed an obvious choice for the shadow chancellor, but she forgot a cardinal rule of politics. Sometimes your friends screw up and hand the advantage to your enemy. You have to fight the battle you are in, not the one you want.

Truly