Angel CoFund rebrands as it launches new £30m ‘fast-track’ fund
Angel CoFund has rebranded to ACF Investors as it launches a new £30m fund for early-stage UK businesses as angel activity drops off.
The VC firm, which is in its tenth year, makes equity investments of between £100,000 and £1m in the UK’s smaller businesses and invests alongside angel investors.
Speaking to Morning Wire, managing partner Tim Mills said the fund had been driven primarily by the reduced supply of capital at the earlier stages.
“There’s more capital than perhaps there has ever been, but most of that’s weighted to the later stages… we’ve seen a big drop off in angel activity.”
With the size of funding rounds reaching record levels Mills thinks there is a “greater inclination to pile into companies that are already well funded”.
That’s where its new “fast-track” Delta Fund comes in. Initially a £30m fund, Delta will see ACF Investors invest alongside at least three angel investors who are new to the business.
This will include at least one lead angel with “demonstrable sector expertise” who has committed more than £70,000 to the round.
“We have developed the Delta Fund to match the maturity of the UK angel investment ecosystem. The Delta Fund will provide access to more capital with reduced process from us,” Mills said.
The firm has a vast portfolio of companies across sectors and its new Delta fund will not be locked into a fund mandate. Mills told Morning Wire the healthcare and life sciences sector would remain a “core pillar” and a healthcare investment is already in the pipeline from the new fund.
Similarly there will be a renewed focus from ACF Investors on greentech particularly as the peak of the pandemic passes.
“It hasn’t been easy to get many of these businesses off the ground but the market is catching up with those opportunities and we expect to do more. We see some of our portfolio companies which we invested in a few years ago now starting to fly,” Mills said.
The firm’s first fund will continue to operate under the name Angel CoFund and wil continue to invest alongside angel syndicates in funding rounds greater than £200,000.