Key facts
- The National Employment Savings Trust (Nest) plans to invest up to £1bn in venture capital.
- The investment will begin with a £200m allocation to Schroders Capital.
- Nest aims to increase its private markets exposure to 30% of assets by 2030.
- The pension scheme manages £68bn in assets and has 14m members.
- The strategy focuses on supporting UK innovation and economic growth.
The UK's National Employment Savings Trust (Nest), the country's largest state-backed pension scheme, has announced plans to invest up to £1 billion in venture capital by the end of the decade. This strategic move aims to enhance returns for its 14 million members and stimulate economic growth by channeling funds into high-growth private companies.
The initiative will commence with an initial allocation of £200 million to Schroders Capital. Nest, which manages £68 billion in assets and receives approximately £700 million in monthly contributions, intends to expand its exposure to private markets from the current 19% to 30% of its total assets by 2030.
Nest has been investing in growth-stage companies since 2022, and this new venture capital push is designed to formalize and scale that approach. The decision aligns with a broader push from UK ministers and financial executives to increase pension fund allocations to private markets, fostering domestic economic growth and supporting innovation.
Nest Chief Executive Mark Fawcett stated that the scheme is particularly interested in opportunities within the UK business sector, emphasizing the potential for supporting UK innovation to drive job creation and economic expansion. He noted that a significant portion of these investments is expected to be in UK-based companies, reflecting member preferences.
Michael Moore, Chief Executive of UK Private Capital, commented that commitments of this scale signal a strong investment case for UK innovation and are crucial for unlocking the potential of the UK's entrepreneurial economy.