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Par Equity scores a century, investing more than £100m in tech SMEs

Par Equity’s investments in high-growth technology businesses have smashed through the £100m mark. The milestone was passed when the company completed five investments in a week earlier in October.

One of the highlights of Par’s recent activity was a multi-million-pound investment in Artus, a company seeking to revolutionise the HVAC (Heating, Air Conditioning and Air Conditioning) industry. A spin-out from engineering giant Arup, with offices in Edinburgh and London, it has developed technology that makes the heating and cooling of buildings more efficient and significantly reduces the amount of energy consumed and carbon generated.

Par, from its headquarters in Edinburgh, backs emerging technology stars across the North of the UK. This strategy sets it apart from 80%-85% of its VC peers, which are London-based and channel most of their investments into the capital and surrounding area. Following the string of recent investments, Par Equity now holds 43 companies in its portfolio, including Cumulus (Belfast), Nova Pangea Technologies (Middlesbrough), Integrated Graphene (Stirling) and Novosound (Glasgow).

Par Equity investors have received proceeds from the sale of its portfolio companies every year since 2013. This demonstrates its track record in identifying young technology companies and supporting them through to successful exits and Par expects 2021 to be its most successful year yet with the sale of Current Health, a “care-at-home technology platform”, to listed US business Best Buy. The deal was announced in October.

As an early-stage investor, Par often supports businesses through multiple rounds of funding. These are frequently led by its discretionary managed EIS fund and further supported by Par’s active and engaged investor network who provide additional capital and expertise. By ‘wrapping’ sophisticated angel investors around a traditional venture capital model the firm augments its investment capabilities and believes it can deliver better outcomes for entrepreneurs and investors.

This model, combined with Par’s growing reputation as a leading early-stage investor, has gained UK-wide attention. In early October, Par Equity was recognised as Best EIS Investment Manager at the 2021 EISA (Enterprise Investment Scheme Association) Awards. In July the company won a hat trick of awards at the UK Business Angel Association (UKBAA) Awards 2021 for Best Angel Group, Best Exit and Scale Up Team of the Year.

Andrew Noble, Partner at Par Equity said, “Over the past few years we’ve seen the confluence of a maturing, successful portfolio and an accelerating technology M&A market, and because we often see a recycling of capital and talent, successful exits like Current Health have the potential to sling-shot exciting new ventures, like Artus, onto greater things.”

Mr. Noble added, “As investors in the next generation of tech talent, we seek to evolve our investment criteria and ways of working to find and build exciting companies. For example, when it comes to ESG we’ve developed a new initiative, ESG_VC, with several of our peers to help early-stage companies measure, monitor and improve their ESG credentials. The associated framework is supported by more than 100 VCs in the UK, Europe and the US.”

In the ESG space, Par Equity’s investment activities extend beyond venture capital and cutting-edge technology. Over the last nine years Par has launched and managed two commercial forestry investment vehicles, building a strong profile in this asset class.

Paul Munn, Managing Partner at Par Equity said, “Commercial forestry as an alternative asset class has an exciting future, with accelerating interest due to the carbon sequestration potential and the launch of tradable carbon credits. As governments, businesses and consumers adopt a net zero mindset, commercial forestry is likely to play a critical role in achieving the targets they set.

Mr. Munn continued, “Crossing the £100m mark for money deployed into young technology companies is a fantastic achievement. I’m grateful to everyone in the Par community for the work they’ve put in over the past thirteen years. We’ve built a strong platform for growth and we are excited about our future investment opportunities, both in terms of our venture capital and commercial forestry interests.”

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