London-based venture capital firm Concept Ventures has launched a £50m fund to invest in UK pre-seed start-ups and address the “huge gap” in the stage investment ecosystem.
Over the next four years, the fund will invest between £100,000 and £600,000 in more than 60 start-ups.
Concurrently with the launch of its previous seed fund, Concept Ventures rebranded as RLC Ventures, the name under which the VC firm was launched in 2018.
During these four years as RLC Ventures, it has supported more than 100 founders at the pre-seed stage.
State-owned British Business Bank made a cornerstone investment of £30 million in the fund ahead of the seed subscription. This happened through the bank’s Enterprise Capital Funds (ECF) program.
The fund is aimed at eliminating the financing deficit at the previous level. The venture capital firm said that 71% of the founders it backed took their startup beyond the seed stage.
Two of its portfolio companies have exited in the past two years, including Cliff.ai, which was purchased Gtmhub in June for an undisclosed sum.
“There is a significant gap in the pre-seeding ecosystem, with too few funds offering specialized pre-seeding expertise,” said Rhys Chowdhury, founder and general partner of Concept Ventures.
“We are fully focused on this critical stage of a company’s lifecycle and can provide the funding, expertise and network needed to succeed. We are deeply committed to building our portfolio for future success.”
Concept Ventures Focus on “Founder Personality”
Concept Ventures said that the “personality of the founder” will be a key factor in choosing investments. This approach is not uncommon at the pre-seed stage, as these startups tend to have a vision rather than a well-defined business model or product-market fit.
But Concept Ventures sees a gap in the investment space to focus exclusively on early-stage companies. In recent years — amid record levels of available venture capital — the lines between funding stages have often become blurred.
Concept Ventures sees this as a chance to provide more targeted advice to startups at this stage and said it provides founders with a specialized framework to help them through their first 12-18 months.
The fund’s limited partners are 80% ethnic minority and 18% female, Concept Ventures added.
Ken Cooper, UK Business Bank’s Managing Director of Venture Solutions, said: “Our cornerstone commitment to Concept Ventures will help them provide finance and support to young and diverse high-potential pre-seed businesses, helping to close the early-stage equity funding gap.”
Concept Ventures launches £50m fund to fill ‘major gap’ at pre-seed stage