b'Mercia asset Management PLc35Annual Report and Accounts 2021Merciainvestmentsangela Warner Managing director,Mercia investmentsMercias national enterpriseour portfolio businesses to ensure that they investment scheme (eis) funds andtransitioned stronger by being able to northern Venture capital trustscapitalise on the opportunities both in the (Vct) plus our regionally focusedpost-COVID landscape and in the emerging institutional venture funds, provideEnvironmental, Social and GovernanceStrategic reportthe lifeblood for Mercias direct(ESG) climate. investment activity, where we invest cash from our own balance sheet intoSoftware businesses, such as Intechnica with selected businesses looking to scaleits Netacea product and Voxpopmes video customer feedback platform, have benefitedGovernance Financial statementstheir growth. our aim is to build and/orfrom the impact of COVID-19 on e-commerce, maintain meaningful equity stakes inwith clients strengthening website security at these assets, whilst also happilythe same time as maintaining valuable and working alongside third-party capital.rapid contact with consumers. Gaming businesses Soccer Manager and VirtTrade This Complete Connected Capital modelalso saw uplifts in activity as more people allows Mercia to get to know businesses andmoved to mobile gaming during lockdown.management teams over an extended periodIn addition, virtual reality headsets saw and offers comfort to those fledglingincreased demand, which bodes well for businesses that deeper capital resource isnDreams that remains at the forefrontavailable to support their journey. We provideof VR gaming. time for early-stage businesses to hone their business model and, in some cases, wait forIn addition, businesses that helped meet the the market to develop. This can be seen in thechallenges of improving sustainability; direct investment portfolio wherelight-weighting, energy storage and approximately half of the investee companiesefficiencies such as Impression Technologies, have been in the portfolio for at least fiveWarwick Acoustics and Faradion are gaining years and we are now seeing profitable exitsreal traction and inbound interest. coming to the fore with The Native Antigen Company, Clear Review and OXGENE allWe will continue to consult and understand 15.4m completed in the year to 31 March 2021.the challenges and ambitions of all our stakeholders in seeking sustainable growth In our successful response to the impact offrom the investments that we are involved in COVID-19, we have demonstrated our abilityand we will integrate ESG considerations into to help businesses in times of uncertaintyour selection and investment processes. Our with our well-capitalised and permanentguiding principles will, however, remain the balance sheet. Using our considerablesame; to strengthen the competitive in-house resource and sectorial expertise, wepositioning of our portfolio companies by put measures in place to support our directfocusing on areas that fundamentally portfolio businesses that went far beyond justimprove cost models, operations and shoring them up in the short-term.customer interactions, whilst continuing to Recognising that the pandemic wasimprove on our track record in the growth accelerating existing trends as well as givingand realisation of these businesses, to drive rise to new trends, we worked closely withinvestor and shareholder value.'