UK launches refugee-focused venture fund with initial £300,000 investment

The UK has launched the Refugee Venture Fund (RVF), a specialized venture capital fund aimed at supporting high-growth businesses founded by refugees. The fund began with an initial investment of £300,000, which is expected to rise to £500,000 in the future. It plans to invest between £50,000 and £100,000 in three to five companies.

TERN, a network that has supported refugee entrepreneurs for a decade, established the fund with backing from Atomico. Potential investors include Dominus, This Day Foundation, Future Leaders, and Lilijan Sulejmanovic, a refugee entrepreneur with extensive consultancy and private equity experience.

Refugee entrepreneurs often encounter challenges in accessing finance, such as limited business track records, smaller networks, unfamiliarity with the funding ecosystem, and misconceptions among investors. According to a survey of 81 refugee entrepreneurs, 56% had previously operated a business before moving to the UK, while 79% employed or planned to employ people in the near future. However, 40% cited access to startup finance as a significant hurdle.

TERN's Strategy & Partnerships Director, Charlie Fraser, emphasized that the RVF targets the UK's most ambitious refugee founders, addressing a gap that traditional venture funds have neglected. The fund's investment strategy focuses on high-growth businesses, particularly those in software, AI, and climate technology sectors. Eligible companies must have majority-refugee ownership or leadership, with founders holding UK-based legal refugee status.

The RVF will prioritize businesses that have developed a minimum viable product, conducted a pilot, or shown commercial traction. It will also consider founders' sector expertise, past achievements, execution ability, and the potential for an acquisition or exit within five to ten years. The fund's advisory board comprises industry experts, including Reece Chowdhry, Matt Penneycard, and Amir Rizwan.

Sukhpal Ahluwalia, a founding shareholder, highlighted the personal significance of the fund for him, given his own refugee background and aspirations for the next generation of UK founders.