How regional capital can power growth
When the Mansion House Compact was announced in 2023, it promised to direct pension savings toward productive UK investment. Two years later, the Mansion House Accord expanded that ambition: up to 10 per cent of defined-contribution pension funds in unlisted assets by 2030, half of that in the UK. The goal is simple – to use the UKs pension capital investment schemes to benefit from the returns generated by the next generation of British growth companies.
The question has always been whether that capital can find a home in the right kind of founders, managers, innovators and businesses in every part of the UK. The answer arrived in Macclesfield.
Regional investments matter
Seven years ago, The Beauty Tech Group was a small loss-making start-up with an idea and a determination to scale. Backed by UK venture funds, such as the Northern Venture Capital Trusts (VCTs) managed by Mercia Asset Management, the company has grown into a global leader in beauty devices, recently listing in London with revenues above £100m and a strong pipeline of expansion and international growth. Its success is proof of what regional capital can do.
This is the Mansion House Accord in practice: UK capital driving UK growth to both the domestic economy and pension savers’ benefit. But to deliver more of these outcomes, we need to think differently about how and where we invest.
The Mansion House Accord matters because Britain’s growth challenge is structural. Too many promising firms sell early to trade buyers or seek listings overseas. Too much capital remains concentrated in London, Oxford and Cambridge. Yet in addition to the triangle are companies with global ambitions and deep roots in their local economies – manufacturers, fintechs, health-tech pioneers and clean-energy specialists. These firms don’t lack ideas; they lack the right capital at the right stage.
That’s where regional investors come in. We founded Mercia to close the gap between local innovation and hands-on national finance provision. With 11 offices across the UK, we meet founders where they are, understand the communities they operate in, and provide the venture, private-equity and debt finance needed to turn ambition into scale. It’s a practical model of productive finance: aligned, informed and close to the ground. Every regional founder we back is balancing ambition with pragmatism, scaling responsibly, creating skilled jobs and reinvesting success into their communities. That’s the real multiplier effect the Mansion House Accord aims for
Every IPO starts life as someone’s seed cheque, combined with a founder’s determination to build something of value. If the UK wants to see more domestic listings and more companies choosing London over New York or Amsterdam, we need to be better about how we fund that early growth journey.
Engines of growth
The Mansion House reforms create the framework for this. By unlocking long-term pension capital and encouraging investment in unlisted assets, they can help bridge the gap between institutional money and regional opportunity. But frameworks alone aren’t enough, they need the engines to make them work.
The Northern VCTs’ support for The Beauty Tech Group wasn’t an exception; it was part of a pattern. We’ve seen regional SMEs transform from early-stage ideas into international exporters because they received sustained, local backing rather than short-term speculation. That is the kind of long-term investment cycle the Mansion House reforms are designed to encourage.
Regional funds can act as the engines that connect the ambitions of entrepreneurs with the objectives of long-term investors. The UK doesn’t lack opportunity – it lacks alignment between capital and geography.
Policy to proof
The conversation around Mansion House will continue, especially as we head into the Autumn Budget. But the direction is clear. Mobilising domestic capital toward regional enterprise can strengthen supply chains, create skilled jobs and deliver genuine long-term returns for savers. That means continued support for the VCT ecosystem, clear guidance on value-for-money assessments for pension schemes investing in venture capital, and an environment that rewards long-term thinking. The policy provides the framework; regional investors provide the proof.
The Beauty Tech Group’s journey shows what happens when both sides work together. If the Mansion House vision is to endure, we need more engines. More regional investors turning potential into proof and founders turning proof into prosperity Now the task is to make stories like it the rule, not the exception.
Mark Payton is chief executive officer at Mercia Asset Management