Returns on UK venture capital investment outstrip returns on all other types of private equity investment, with VC fund returns* since 2001, returning on average 2.13 times their investors’ initial investment compared to an average of 1.78x across all PE funds, says private equity firm Growthdeck.

The returns on venture capital funds since 2001 are higher on average than for private equity funds investing in large companies (1.82 times initial investment), mid-sized companies (1.67x) or smaller companies (1.8x).

Simon Emary, Director and Head of Portfolio at Growthdeck, says that the figures may surprise some who assume that the largest private equity investments deliver the highest returns.

Emary says that investments by VC funds into tech companies over the last 15 years that have been able to scale up far more rapidly than a traditional company have been a major contributor to their market-beating returns.

Says Simon Emary: “Venture capital has really proven its value to investors over the past two decades. Previously it had been about picking the right VC funds but this data shows that the category, on average has outperformed. Being able to access investment in the fastest-growing companies – like tech and fintech – has delivered very substantial returns.”

“Tech-focused VC funds have funded and benefitted from the most explosive growth phases of virtually every household-name tech business of the last 20 years. That’s just as true in the UK as in the US.”

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