b'12 Mercia Asset Management PLC Annual Report & Accounts 2022StrategyMercias hybrid investment modelSusan DevineFinancial ControllerWayne ThomasinvesteesManaging Director, Private Equity FundsSustainable growth We invest exclusivelyWe have continued to scale our platform to meet the needs of our entrepreneurs.in the UKOur proven hybrid business model allowsOur teams are conveniently based us to be proactive in supplying seedin the following eight regional investment funding through Series B andlocations across the UK.secondary funding. The intention is to help the most promising enterprises to scale up. Our pipeline consists of new companies as well as proven success stories from within our portfolios. All are served by our third-party funding. The operational expertise of our team and the support offered by Mercia Nucleus, which provides an infrastructure of knowledge and good governance, nurture these businesses until we selectively invest our proprietary capital. This allows us to identify and deliver future direct investments. These ventures, once successfully realised, enable us to offer an attractive set of returns to our investors, which underpins our progressive dividend policy.Working on a local scale to gainglobal market shareBalance sheetTypically up to 10mFrom our balance sheet, we use our proprietary capital to invest in the most promising businesses within our third-party management funds. Investing on a selective basis ensures that follow-on capital is deployed at the right time, to the right businesses, to enable these enterprises to reach their full potential.Newcastle Preston LeedsWith our robust liquidity and strong syndication partnerships, we can afford to take a medium to long-term view. Manchester Sheffield Bristol119.6mValue of direct investment portfolioHenley-in-Arden LondonSee more on page 26.'