London-based Hambro Perks has held a first close of its latest venture debt fund on an undisclosed sum with backers including British Business Investments.
The vehicle, Hambro Perks Growth Debt Fund, is targeting £100 million ($114 million; €116 million) and expects to hold a final close during H1 2023.
British Business Investments and Phoenix Group have acted as co-anchors to the fund and Foresters Friendly Society has also joined the first close alongside additional commitments from family offices and high-net-worth individuals.
It will target investments in B2B software companies and patented hardware companies in the UK and Europe with proprietary intellectual property. Portfolio companies will be post-revenue but pre-profit, yet they will be on track to profitability and cash breakeven.
Hambro Perks will provide them with non-dilutive capital to enable founders and shareholders to maintain their shareholding in the company while providing cash to fund growth. It will support companies that have previously raised equity or are raising equity at the same time as debt.
Ticket sizes will range between £1.5 million and £10 million, with an average of between £3 million and £4 million, taking the form of senior secured amortising term loans.
David Hayers has joined Hambro Perks from Virgin Money and will head up the fund. Commenting on the first close, he said: “The growing market presents a strong opportunity for investors, especially in the current venture landscape. The new fund will enable management teams and existing investors to accelerate growth without needing to commit more capital or introduce new investors. The fund is also a good hedge against inflation and the more cautious equity investment environment.”