London-based venture capital firm Volution has launched a new $100m fund.
The firm, which invests in high-growth FinTech, AI and SaaS businesses tackling productivity challenges in capital markets and enterprise, has launched the fund in partnership with Japan-based SBI Investment.
It is its second dedicated fund and following the success of the first, a significant number of Volution’s existing LPs have recommitted to the new fund.
In 2024, funding at Series A dropped by 44% compared to the prior year and Series A to Series B conversion rates have dropped by over 50% in the last five years.
Through its new fund, Volution aims to bridge this gap by backing businesses that have already established strong revenue streams but require additional capital to expand.
The company has already supported high-growth companies such as Signal AI, Flagstone and Cognism.
Its first fund has so far achieved 300% average revenue growth, delivering three exits and a portfolio which includes unicorn Zopa Bank.
“The UK has a huge challenge at the moment. The Government is laser focused on productivity and growth but there is a fundamental structural funding challenge,” said James Codling, managing partner at Volution.
“We have overfocused on unlocking cash at the very early stage through various tax efficient investment schemes but the money tends to evaporate post Series A. Companies get sold, fold or become walking zombies.
“Investment at the inflection point of international growth is critical for the tech company and offers the most significant returns for LPs.
“The businesses we back aren’t just an idea and a couple of letters of intent. These are successful businesses aligned with the Government’s Industrial Strategy.
“They have figured out product-market fit, have a solid go-to-market strategy and are achieving significant revenue of at least £5m ARR.
“Volution is the catalyst to propel them to the next stage, both financially and by leveraging the team’s extensive experience in scaling tech businesses.”
Tomoyuki Nii, director, executive officer (overseas investment), SBI Investment said: “The UK is a global leader in FinTech and AI, with world-class universities, a strong regulatory environment and a thriving entrepreneurial ecosystem.
“These strengths make it an attractive destination for investment. Our cornerstone commitment to Volution comes at a time when Japan and the UK government are strengthening economic ties to drive growth across both markets.
“Building on the success of Volution’s first fund, it will provide a new funding option for fast-growing UK businesses looking to scale.”
