Fund manager Schroders has launched the UK’s first long-term asset fund (LTAF) dedicated to UK venture capital investing.

The LTAF is the third for the fund manager and has received regulatory approval from the FCA.

Schroders launched the UK’s first LTAF in April 2023. LTAF's are designed to encourage long-term investment in sectors seen as relatively illiquid but which benefit the UK economy.

The LTAF will offer institutional investors the opportunity to participate in the growth and development of “groundbreaking UK early-stage companies” focused on technology and life sciences.

Schroders Capital will invest across companies that are pioneering the development of long-term innovation themes such as artificial intelligence, quantum computing, fintech, cybersecurity and oncology.

The fund will be seeded with a cornerstone investment of £300m.

Schroders Capital’s private equity team has a track record in venture capital investing in early-stage technology and healthcare. The team has invested £1.3bn into around 1000 UK companies to date.

Tim Creed, head of private equity investments at Schroders Capital, said: “The UK is the largest venture capital market in Europe and a key global innovation hub. This fund will allow a broader range of investors to benefit from the next technology revolution and access innovative companies driving long-term megatrends.”

LTAFs are regulated, open-ended investment vehicles designed to enable a broader range of investors, with longer-term horizons, to invest efficiently in illiquid and private markets. Their structure is designed for the UK defined contribution, defined benefit, and UK charities markets.