Schroders Capital, the $97.3bn private markets specialist, has completed the first £500m close of its UK Innovation Long-Term Asset Fund (LTAF).

The fund, designed to back high-growth early-stage companies, has already made two strategic investments in AI pioneers Synthesia and Luminance.

The LTAF attracted commitments from key investors, including the British Business Bank and Phoenix Group through its venture with Schroders, Future Growth Capital. The successful close highlights the growing interest from defined contribution pension schemes and institutional investors in private market investments, particularly within the UK’s burgeoning technology and life sciences sectors.

The fund focuses on global innovation themes such as artificial intelligence, cybersecurity, fintech, infrastructure software, oncology, and biotech. Its first two investments—Synthesia, a leading AI-powered video platform, and Luminance, an AI-driven legal solutions provider—demonstrate its commitment to backing transformative UK technology companies.

Synthesia’s funding will support its international expansion, including growth in Japan, Australia, Europe, and North America. The deal extends Schroders Capital’s partnership with Synthesia, following a previous co-investment through MMC Ventures. Meanwhile, Luminance will use its investment to enhance AI-driven legal solutions, expand its Cambridge R&D hub, and establish new offices across the US, APAC, and Europe.

Tim Creed, Head of Private Equity Investments at Schroders Capital, emphasised the UK’s role as a hub for European innovation. He noted that the fund’s first close demonstrates strong investor appetite for strategies supporting forward-thinking businesses.

Schroders Capital’s private equity division, with nearly three decades of early-stage technology and healthcare investment experience, has positioned itself as a leader in providing institutional investors with access to private markets. The UK Innovation LTAF is part of a broader effort to unlock long-term investment opportunities for pension schemes under the UK’s Financial Conduct Authority-approved LTAF regime.