Mercia Asset Management, a leading provider of funding for tech companies in the UK, has reported investing over £281 million in 2023, a 39% rise from the previous year and the highest amount for any year till date. During the year, the company backed 195 companies compared to 176 in 2022. Over 77% of the investment went to companies outside of London to address the funding gap in all regions of the UK. The majority of the investment was in venture capital, with the remainder being loan finance, including funding from Frontier Development Capital, which Mercia acquired in 2022.
After successful exits and third-party fundraising, the company now has almost £400m of capital to invest across the group and expects to increase its investment further in 2024. During 2023, Mercia sold its largest investment, nDreams, to Canadian games publisher Aonic. Other successful exits included Intechnica, ParkVia, SockMonkey Studios, and Secure Empty Property.
Key investments during 2023 included Netacea, Expert Technologies, Zedify, Tribosonics, Camena BioScience, ImmuONE, and Aelius Biotech. The company manages assets worth approximately £1.5 billion, including parts of the Northern Powerhouse Investment Fund (NPIF), Midlands Engine Investment Fund (MEIF), and North East Venture Fund (NEVF) for the British Business Bank. It also manages EIS and VCT funds and institutional capital for private equity and debt deployment.
Dr. Mark Payton, CEO of Mercia, said that the company has backed compelling businesses across the UK, nurturing rising stars and building thriving start-up and scale-up communities, despite the overall supply of new venture capital declining. He expects a marked increase in investment in 2024 and encourages businesses to reach out to the company for support to prepare for future growth. Despite the challenging economic climate with recovery expected to start towards the end of the year, the company looks forward to supporting many more businesses in the upcoming year.