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Interim Assessment of Enterprise Capital Funds (ECFs) and Capital for Enterprise Fund (CfEF)

Client - Department for Business Innovation and Skills and reporting to the British Business Bank (2013-2014)

This interim evaluation of two government hybrid venture capital (VC) funds was undertaken in 2014 in collaboration with BMG Research who undertook circa 100 'CATI' telephone surveys with the senior directors of portfolio companies and included a small control sample of 'dead deals' which came close to receiving funding. The survey included a full review of the funding process and resultant impacts, including consideration for wider economic impacts and Value for Money (VfM) assessment of both the ECF and CfEF schemes. Supply-side in-depth qualitative surveys were also undertaken, face-to-face and by telephone with 17 participating fund managers and 8 other private VCs and angel capital groups operating in the UK's seed and early stage markets where these schemes have been targeted. A further 6 key informant interviews were drawn from industry experts such as the British Venture Capital Association and UK Business Angles Association. The research indicated that both schemes have met equity gaps in the UK markets and that they have made some impact on developing the UK seed and VC markets. However, because the exit market has been set-back by the Global Financial Crisis, it is still too early to assess what the likely performance of these funds will be.

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