b'Mercia asset Management PLc17Annual Report and Accounts 2021responsible investor recruiting to build out the People and Our origin and focus is to invest exclusivelyTalent team to provide additional internal in the UK, targeting what we term asexpertise to lead on talent development.Thriving Regional Businesses that are seeking capital in the form of debt, privateoutlookequity, venture capital or a combination ofThis last year has seen venture businesses these. Physically located in the regions, wein Diagnostics, Biotech and Software employ locally for Mercia and our portfolio.sectors excel. These sectors have The high-growth companies we supportdelivered the majority of both the Groups are typically less than 10 years old, ofteninvestment realisations this year and net seeking capital of less than c.50million inasset value growth. The 10 profitable fund total and are frequently overlooked byand direct investment exits in this most capital providers.reporting period are a record for Mercia and derived from our regional venture Our focus is the provision of finance andfunds, Enterprise Investment Scheme support for these businesses with(EIS) funds and the Northern Venture Environmental, Social and GovernanceCapital Trusts (VCT); three of the 10 also awareness (ESG) at the heart of ourbenefitted from our proprietary capital. operation. Not only do we have an ESG teamThis excellent performance puts us in aStrategic reportat Mercia capably led by Investment Directorstrong position for continued growth in all Jill Williams, but this emphasis alsoasset classes within our third-party Funds cascades from the Board throughout theunder Management (FuM).Group. The ESG team have set diversity for Mercia, and its portfolio companies, as theirCertain businesses operating within DeepGovernance Financial statementspriority for this coming financial year. InTech and Clean Tech, including in the addition to our investment activities, weAutomotive sector, were negatively We are only also operate Mercia Spirit where employeesimpacted by the pandemic back in March give their time and raise money to support2020. During the year, we focused hard on as good as thelocal and national causes. Our nominatedsupporting these businesses, however not people wecharities are Cancer Research UK and Theall of the fair value decreases from last year Skills Builder Partnership, the latterhave reversed. Our investment thesis is that attract, employtargeted at helping regional schools. Anthese sectors that were hurt the hardest last additional resource, which is not charged toyear will in due course recover. We and retain. Mercias portfolio, is the provision ofpassionately believe in investing through training, webinars, marketing services andthe cycle and during the year we have executive search (for board, executive andinvested 94.4million across the Group insenior management level) via our76 new businesses and 97 existing portfolio Marcomms team led by our Head ofcompanies. A number of these were in Deep Marketing and Communications, AlisonTech, Clean Tech, Life Sciences and Dwyer and by our Head of Portfoliopurpose-led businesses; sectors we believe Resourcing, Lisa Ward. will be core value creators in the near to medium-term future.responsible employerFundamentally we are only as good as theEconomists forecast UK domestic growth people we attract, employ and retain. Ourof between 5% to 8% for 2021. This is an People and Talent team led by Michelleexcellent backdrop for Mercia and its 76 Heaselgrave are exceptional and,portfolios as we begin the new financial combined with the benefits and supportyear with confidence in our new Mercia we provide to our teams, we believe that20:20 vision, whilst ensuring we remain new businesses receivingMercia is becoming a first-choiceboth a responsible investor and employer investment employer. Our strong focus on group-wideas we continue to seek to be the first choice communications ensures aligned Groupfor investors, investees and employees. performance by a motivated team; what 97 we term #OneMercia. In addition, we willdr Mark Paytonconstantly strive to develop our team further. Our Mercia Academy is anChief Executive OfficerPortfolio businessesimportant part of this, and we are receiving follow-on investment'