Co-investment funds

Co Investment Funds are specifically designed to invest alongside business angel syndicates

The Angel CoFund

The £100m Angel CoFund was launched in November 2011 and is specifically designed to invest alongside business angel syndicates from across England.

The Angel CoFund is managed by British Business Bank. The Fund is a private sector body with clear objectives to boost the quality and quantity of business angel investing in England, and to support long-term, high quality jobs in growing companies.

The CoFund only invests alongside investments made by Business Angel syndicates with an experienced lead investor, and cannot consider proposals from individual investors. It is not a VC fund and is very much a “big Angel” seeking to invest on the same terms as the syndicate have agreed.

Find out more about syndication

Investment Terms

Syndicates should be looking for the Angel CoFund to provide equity or quasi-equity investment of between £100K and £1M into eligible SMEs. The fund will provide up to 49% (although by preference will be a smaller proportion) of the capital in investment rounds ranging from £200K upwards. The size of the investment proposed needs to be significant enough to properly fund the business and to allow for the cost of due diligence and legal advice. The investment needs to be a new investment for the syndicate, rather than supporting an existing investment.

The fund will, to the extent possible, follow the investment terms proposed by the syndicate, including the structure and price of any investment and will invest in equity (or equity-like instruments) alongside other syndicate partners. It is anticipated that many investments will be compliant with the Enterprise Investment Scheme (EIS) but this is not a criteria for funding.

What type of business will the CoFund invest in?

Investee companies must not have more than 250 employees and turnover not exceeding £50M and balance sheet assets not exceeding £43M. They can be from within any industrial sector at any stage of their lifecycle and in any region of the UK, providing they have the required level of investment from the angel syndicate.

How to Access the Angel CoFund

Applications to the Angel CoFund can only be made by business angel syndicates and initial applications to the Angel CoFund should be made using the Investment Proposal Form which can be downloaded by following the link below. Further to a basic eligibility check, a detailed investment paper, with supporting due diligence, will then be requested. The Investment Proposal Form and outline of the content of the investment paper and a description of the type of due diligence required can be found on the Angel CoFund website.

The investment proposal is considered by the Angel CoFund’s Investment Committee which is composed of experienced angel and early stage investors who will consider all propositions on a fully commercial basis, “from the perspective of an angel investor”. The syndicate will be expected to take the lead in managing the deal through to completion.

London Co-Investment Fund

The London Co-Investment Fund (LCIF) was set up in early 2015 and is funded by the Mayor of London for £25m to co-invest in seed rounds of between £250k and £1m. It is managed by Funding London working with Capital Enterprise. The fund allocates a pool of co-investment to designated funding partners and seeks to invest in high growth tech, science and digital start-ups that are based in Greater London.

The London Co-Investment Fund invests exclusively in funding rounds led by our competitively selected co-investment partners and all investment related decisions are made by the partners. For every £1 that the fund invests, the partners are obligated to directly invest £2.9 or secure the same from their investors.

All deals must have co-investment through the designated partners, although other syndicates and investors could co-invest alongside these partners

  •  London Business Angels
  •  Beacon Capital
  •  Firestartr
  •  Playfair Capital
  •  Craigie Capital
  •  Forward partners
  •  Downing Capital
  •  Seedcamp
  •  Crowdcube

Co Angel Investment (Manchester)

Supported by the Greater Manchester City region, the Co Angel Investment initiative was established to leverage angel investment alongside Manchester’s innovating early stage businesses based in Manchester. The project does not have any direct Fund to co-invest but employees an investment management team to identify and structure deals, identify relevant angel investors, support due diligence and bring longterm support to the investments. The programme is also able to mobilise other funds alongside deals including the Angel CoFund.

Wales Angel Co-investment Fund

The Wales Angel Co-investment Fund delivered by the Development Bank of Wales has been created to stimulate additional angel investment in Wales and provide Welsh business with a key source of alternative finance by encouraging more active angel investment. The five year £8m fund supports the creation of angel syndicates and networks across Wales by providing loans and equity up to a maximum of 50% of the funding provided by angel syndicates. Deal size from the fund ranges from £25k – £250k and there is a fund limit of £700k exposure to any one investment syndicate. Only syndicates led by “Lead Investors” (pre-approved with a track record of investment success) who can identify, shape and negotiate fundable proposals can apply to the fund. If you are interested in becoming a lead investor contact Wales Angel Co-investment Fund.

Other VC Co-investors

Several other Venture Capital Funds, VCTs and EIS Funds have a focus on co-investing with angel investors and angel syndicates to build relevant deals and to offer next stage growth finance.

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