British Business Investments has provided €27 million to support venture debt vehicle Bootstrap Europe II.
BBI, which is the commercial investment arm of the British Business Bank, said venture debt funds increase the supply and variation of finance on offer to UK businesses.
Bootstrap Europe II will invest in venture debt with a focus on high-growth technology companies. The fund’s management company, Bootstrap Europe, said it wants to be a stable source of capital for the next generation of innovators.
The firm said it will support entrepreneurs with funds to help them grow quickly without having to give up significant equity stakes in their business.
Bootstrap Europe said the UK and continental Europe have a significant funding gap for companies that want to scale-up.
Stephanie Heller, managing partner at Bootstrap Europe, said: “In US venture capital, for every $10 raised in equity, $1.5 is invested in non-dilutive financing. It is time to bridge the financing gap in Europe and to support entrepreneurs in a meaningful way.”
Bootstrap Europe’s team has invested in more than 230 transactions in sectors such as smart cities, Internet of things, material sciences and B2B software.