One of the most important players in the UK’s start up landscape is making progress towards supporting more growing and scale up businesses. Having just celebrated ten years since its foundation, the British Business Bank (BBB) is heading towards a greater role in supporting innovative businesses in the UK.
Leandros Kalisperas, the Bank’s Chief Investment Officer, recently talked about a shift in strategy away from working just with VCs and more towards direct investment in companies that it deems are ready to take the next step in growth.
In practice that will see the BBB recalibrating its own investment strategy to provide more capital for scaling companies while also “crowding in” finance from private sources, including VCs and ultimately pension funds.
Earlier this year, under the Government’s Modern Industrial Strategy initiative, the BBB was allocated £4 billion to invest in young companies working in sectors considered crucial to the future of U.K. prosperity, with a further £2.6 billion earmarked for promising startups operating in any industry.
That has seen a switch away from only channelling investment through VC funds: now, the BBB is undertaking more direct investment, (albeit alongside VCs). To date, it has provided £250 million in equity funding for 33 scaling companies in the tech and life sciences sectors. Moving forward, the BBB intends to step up direct investment to support companies that are, as it sees it, at the forefront of innovation and growth.
However, Kalisperas stresses that the state-funded bank won’t be allocating public funds in a vacuum. Although it will invest directly, this will be in concert with VCs.
It’s probably more accurate to call it co-investing rather than direct investing.
In the UK, the picture for start ups is getting brighter, with the proportion of startup insolvencies at lowest level in a decade, with numbers returning to pre-pandemic levels.
That rate is at its lowest level for more than a decade, according to new analysis from PwC. In 2024 startups accounted for 46% of total company insolvencies, the lowest proportion in a decade by a large margin – despite record levels of company incorporations over the period. A closer look shows that 89,515 new ventures launched in Q1 2025, up 2.8% from the same period last year, indicating strong entrepreneurial activity in the UK.
“It’s really important that bodies like the BBB get hands on with their support for the UK’s growing businesses,” says Paul Beare.
We work with lots of companies that are determined to grow in the UK, so opening up as many avenues to financial support and investment is vital to keep them here, and keep them thriving.
Wherever you are in your growth journey, getting the right advice and support from an accountancy practice is vital. That’s why at Paul Beare we offer a full range of accounting services, from tax and payroll to accounting and banking.