Highly active social-impact fund Bethnal Green Ventures is going to be purchased by Connected Asset Management in a deal that will allow Connected’s clients to invest in socially responsible VC opportunities.
Connected is a manager for Smart Pension, which is an occupational pension scheme in the UK. Up to this point Smart Pension clients could opt for funds managed by titans like JP Morgan, but with this acquisition, they will be able to back VC investments made by the team that built Bethnal Green Ventures.
Pension funds are actively looking for ways to make their investment options more socially responsible, and this acquisition shows how these goals can be accomplished. Well run VC funds also tend to create returns that are higher than major equity markets, which may be attractive to investors.
Bethnal Green Ventures CEO and managing partner, Paul Miller, commented,
“Pensions are the ultimate in long-term thinking. If you’re starting to make contributions in your first job when you’re 18 or 19, and you’re told you’re not going to get any of that money for at least 40 years, it begs the question: ‘What this world is going to be like in 40 years?…That’s why there is a recognition in the pension industry that they are talking about long-term issues and they need to engage their members in those issues.”
Bethnal Green Ventures has an impressive track record in the tech-for-good investment arena. When it was founded in 2012, there was little interest in tech. Today, that has changed. Over the past decade the fund has invested in 141 companies, and the move by Connected to acquire it shows that the UK/EU pension industry is in flux.
Data from Invest Europe shows that pension funds put more than three times the amount of capital into VC in 2019 than the average amount over the four years preceding. Deals like Connected’s acquisition of Bethnal Green Ventures will also allow more retail money to flow into VC, and support smaller companies in the market.
