Innovation Investment Fund – Procurement of a Fund Manager

Cardiff Capital Region (CCR) City Deal is a 1.1bn GBP economic growth programme which was agreed in 2016 between UK Government, Welsh Government and ten local authorities in South East Wales (the "Region") to bring about significant economic growth in the Region through investment, upskilling, and improved physical and digital connectivity. The CCR local authorities are: Blaenau Gwent, Bridgend, Caerphilly, Cardiff Council, Merthyr Tydfil, Monmouthshire, Newport, Rhondda Cynon Taf, Torfaen and Vale of Glamorgan. In furtherance of the City Deal core objectives, CCR is seeking to establish a 50 million GBP Fund that will provide funding support to high growth innovative businesses looking to scale up, via patient capital or long-term investment, in the South East Wales region. The Fund is anticipated to be classed as an alternative investment fund and will be structured under a conventional corporate limited partnership model. The Fund Manager will be engaged under a bespoke fund manager services contract to be entered into with the general partner or another corporate entity (once established by or on behalf of CCR). CCR, however, reserve the right to engage the Fund Manager directly or via an alternative corporate structure (to include a corporate joint committee if and when established by CCR). CCR anticipates that the duration of the Fund Manager's services contract will align with the duration of the Fund. The term of the Fund is anticipated to be for an initial 5 years of investment activity, followed by up to 7 years of monitoring and management of the fund portfolio, with the possibility of an extension by CCR for further period(s) of up to 2 - 3 years. The appointed Fund Manager will be expected to procure co-investment capital for the Fund, and for individual investments, either directly and/or via other public and/or private sources. The target total level of investment commitments to the fund is 100 million GBP, including co-investment from other investors. The principal objectives of the Fund, investment products, investment criteria, eligibility criteria and target outputs are set out in the Investment Strategy which has been issued as part of the Draft ITPD alongside this Contract Notice. CCR is seeking to commission an FCA authorised fund manager to, amongst other matters, help market the Fund, source and originate investment opportunities, source investment from other investors and a pipeline of applicants, undertake due diligence on applicants and (acting as the general partner) manage the capital allocated under the Fund. It is intended that CCR will invest 50 million GBP into the Fund at the outset to fund the initial 5 years of investment activity which is to be supplemented by co-investment capital. The full scope of services is set out in Fund Manager Services Contract which has been issued as part of the Draft ITPD alongside this Contract Notice. CCR is now inviting suitably qualified candidates to submit a response to the standard selection questionnaire (SQ) for this contract opportunity. Details of where to obtain the SQ and other documentation being released at this stage can be found in Section I of this contract notice. The contract value for this opportunity is an estimated range of 10m GBP - 65m GBP. The range has been calculated using market comparator rates for profit and fund activity. Additional information: Please note, the estimated value at II.1.5 and II.2.6 is based on the maximum 15 year duration of services.