Accelerating the conversation in Venture Capital

By Jenni Hartley, Director and Dom Rice, Manager, Guernsey Funds Team

The UK Private Capital Accelerate conference brought together leading investors, founders and policymakers to explore the forces shaping venture capital today. Across sessions, several consistent themes emerged, from shifting investor sentiment and the rise of AI, to the importance of scale, capital access and ecosystem maturity.

Below are our key takeaways from what was an interesting and insightful event.

Defence and security have moved into the venture mainstream

A clear shift in sentiment is underway across defence and dual-use investing. What was once a niche or contested area is now widely recognised as strategically important, driven by geopolitical change, increased defence spending and growing awareness of resilience and infrastructure needs.

The market is moving beyond dual-use positioning toward more explicit defence-first strategies, with increasing appetite from LPs and the emergence of specialist funds across Europe. At the same time, talent pipelines are strengthening, with universities and researchers becoming more open to defence-related innovation.

A key challenge remains scaling globally. While sovereign funding can create strong domestic positions, long-term success will depend on companies building internationally from day one and navigating procurement complexity effectively.

Emerging managers must combine discipline with differentiation

For first-time and next-generation managers, the bar continues to rise. Operating lean, maintaining strategic clarity and demonstrating resilience are now essential, particularly in a highly competitive fundraising environment.

LPs are increasingly focused on differentiation, with emphasis placed on network access, sourcing advantages and authentic relationships rather than simply sector focus. Performance remains paramount, but how managers access opportunities is becoming just as important.

Operational infrastructure is also critical. Third-party administrators are viewed as an extension of the manager, playing a central role in delivering transparency, reporting quality and institutional confidence.

The UK has world-class research, but must improve commercialisation

The UK’s research base remains a significant global strength, supported by leading universities and deep pools of technical talent. However, the challenge continues to be translating innovation into scalable, venture-backed businesses.

Greater alignment between universities, founders and investors is needed. A more commercially focused approach, including balanced equity structures and a willingness to prioritise long-term ecosystem value over short-term returns, will be key to unlocking more spinouts.

Improved collaboration, increased funding for tech transfer, and greater access to growth capital were highlighted as critical levers to accelerate progress.

Deep tech is strategically critical, but scaling remains the gap

Deep tech is increasingly viewed as essential not only for commercial growth but also for national security and economic resilience. The UK continues to punch above its weight in early-stage innovation, particularly in AI and quantum.

However, a persistent gap remains in late-stage capital, limiting the ability to scale companies domestically. Institutional capital, especially from pension funds, is slow to deploy despite clear intent.

To remain competitive, the UK must accelerate capital deployment, encourage corporate adoption and position government as an anchor customer to support commercialisation.

Fintech leadership is no longer guaranteed

The UK remains one of the most important global fintech ecosystems, but its leadership position is increasingly being challenged. While the country benefits from strong talent density, regulatory expertise and global connectivity, rising costs and policy friction are creating headwinds.

The next phase of fintech growth will be shaped by infrastructure modernisation and AI adoption. Firms must first transition to cloud and API-based systems before fully realising the benefits of AI-driven operating models.

Scaling remains a key issue. Beyond capital, greater enterprise adoption and stronger commercial partnerships will be needed to support startups as they mature.

AI is redefining valuations, growth and exits

Artificial intelligence continues to reshape venture capital markets, influencing everything from fundraising dynamics to exit opportunities. Companies effectively leveraging AI are attracting premium valuations, while those without a clear AI proposition face increasing challenges.

At the same time, traditional growth benchmarks are being redefined, with some businesses achieving unprecedented revenue acceleration. However, investors remain focused on fundamentals such as defensibility, quality of revenue and long-term retention.

Looking ahead, the UK’s ability to retain talent, attract capital and support global scaling will be critical in capturing the full value of its AI innovation.

Institutional capital is starting to move, but more progress is needed

The Mansion House reforms are beginning to influence institutional attitudes toward venture capital, with pension funds and long-term investors showing increased interest in private markets.

Despite this progress, challenges remain around understanding the asset class, governance frameworks and allocation strategies. Education and consistency of deployment will be key to unlocking sustained institutional participation.

Encouragingly, there is strong confidence in the UK’s ability to produce globally significant companies, provided long-term capital continues to support them through scale.

A market defined by structural, not cyclical, change

Across all sessions, a common theme emerged. Venture capital is undergoing a period of structural transformation rather than a short-term cycle.

Geopolitical shifts, the rise of AI, the importance of sovereignty, and evolving capital dynamics are reshaping how investors deploy capital and how businesses scale. The opportunity is clear, but execution, alignment and access to capital will determine who captures value.

How Belasko supports venture capital managers

Belasko has extensive experience supporting venture capital managers across the full fund lifecycle, from first-time funds through to established platforms operating internationally.

Our teams work closely with managers to provide robust fund administration, operational infrastructure and scalable solutions that support both fundraising and long-term growth.

If you would like to discuss how we can support your venture strategy, please get in touch with Jenni ([email protected]) or Dom ([email protected]).