The UK Government has launched a second round of Enterprise Capital Funds (ECF), the initiative to bridge the £250,000 and £2m equity gap for seed stage technology businesses.
The Government will be committing £50m in the latest tranche, and expects to invest another £50m for a third wave in late 2007. Bids to manage the ECFs have to be in by February 28th, details of which can be found at www.sbs.gov.uk.
The news comes as London-headquartered technology venture firm Amadeus Capital Partners has closed its ECF on £10m.
Amadeus was awarded the ECF in May this year, with £6.5m coming from the UK Government and £3.5m from Archangel Informal Investments and over 50 private investors.
The fund, the Amadeus and Angels Seed Fund (AASF), in practice has up to £20m to spend, with investments being matched 50/50 by the firm’s main funds.
Laurence John, CEO of the Amadeus Mobile Seed Fund, will manage AASF. The investment team plans to make up to 10 investments, with follow on financing and support in order to make the companies attractive for series A funding.
The fund has already made its first investment, opening its doors to XMOS, a semiconductor company based in Bristol.
The firm was awarded ECF funding in the first tranche at the beginning of 2006 alongside five others: the IQ Capital Fund, managed by NW Brown & Company, which closed on £25m; the £30m 21st Century Sustainable Technology Growth Fund, managed by E-Synergy; the Seraphim Capital Fund, a £30m fund run by GLE; the Dawn Capital Fund managed by Dawn Capital; and the Midlands Enterprise Fund, managed by Catapult Venture Management.