Schroders Capital has completed the first £500 million close of its UK Long Term Asset Fund (LTAF) after investing in two AI companies.

The fund is designed to back early-stage, high-growth companies and invests in areas including AI, cybersecurity, FinTech and BioTech discovery platforms.

Schroders said the close of the fund coincides with a period of significant technological advancements in AI within the UK and marks a pivotal moment for growth in UK companies.

The company added that it has already deployed capital with its first two investments. In January, the fund invested in AI-powered enterprise video communications platform Synthesia, and this month it completed an investment in Luminance, a pioneer in Legal-Grade AI which completed a $75 million funding round earlier this week.

The investment in Synthesia will fuel the firm’s next phase of growth and drive the expansion of its video platform to meet the evolving needs of enterprises in several markets. The investment was an extension of Schroders Capital’s long-standing partnership with Synthesia through its co-investment partner, MMC Ventures.

For Luminance, the funding will provide resources for further innovation out of the company’s Cambridge R&D hub, as well as expansion with new hires and offices across the US, APAC and Europe.

The fund has raised commitments from investors, including the British Business Bank and Phoenix Group, a long-term savings business. Schroders said the close indicated the desire from institutional investors to participate in the growth and development of UK early-stage companies.

Tim Creed, head of private equity investments at Schroders Capital and co-manager of the fund, said that the UK is a hub for European innovation, with technology companies in the region set to play a crucial role in shaping the future of its economy.

“This milestone underscores the interest from pension schemes, reflecting the need for strategies that drive forward-thinking investments,” he added. “Early-stage UK businesses are at the forefront of driving groundbreaking advancements not only in technology, but in a huge range of sectors.”

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