UK's sovereign lender preps new strategy, after timid tech investments

Updated November 7 at 2:25pm GMT to update quote attribution to Helen Williams and include a second comment from NWF.

The UK’s new National Wealth Fund (NWF) is gearing up to publish a new strategic plan for how it invests in technology – after facing criticism for a lack of clarity about its strategy and early timidity in investment choices. 

The NWF was previously known as the UK Infrastructure Bank (UKIB) – but restructured in October 2024 by Chancellor Rachel Reeves.

She described the reformed bank as now having a “broader mandate, extending beyond infrastructure to support delivery of the wider Industrial Strategy in areas where an undersupply in private finance exists.”

£1.6 billion invested in tech, but…

Its predecessor has invested £1.6 billion in “digital and technology” projects to-date. But analysis by The Stack shows that these almost entirely focused simply on broadband infrastructure rollout across the UK.

(Its biggest investment, Gigaclear, is struggling to stay afloat and seeking buyers after racking up a £1 billion debt mountain. If it fails to secure fresh investment or a buyer, the NWF could be in line for a haircut.) 

The UKIB’s 12 investments in 10 companies include a £250 million loan in 2022 to NexFibre. Other Altnet broadband firms have been the main beneficiaries, with CityFibre, Gigaclear and Quickline receiving at least £200 million from the £27.8 billion fund, to support the capital-intensive work of installing fibre broadband infrastructure across the country.

Digital Infrastructure Investment Partners, Hyperoptic, Fibrus, and Netomnia have all received at least £100 million in investment.

The NWF said its previous focus on broadband firms stems from its mandate to support the government’s Project Gigabit, a plan to bring broadband to rural and remote areas across the UK. 

Critics had earlier slammed its predecessor, the UKIB, for timidity and said it was spun up in a rush with poor processes in place.

Parliament’s Public Accounts Committee noted in 2023 that the “significant risk” of it operating without an effective audit and risk committee, among other issues, “had to be counterbalanced by choosing low risk early deals, approved through Treasury processes…”

While the Chancellor’s ‘strategic steer’ in March expanded this remit to include broader technologies with a focus on supply chain resilience, defence and security, the NWF is still developing its new approach ahead of publishing a strategic plan in early 2026, it told The Stack.

Chief Strategy and Policy Officer Helen Williams said: “With the expansion of our mandate, there are more opportunities for us to explore our role in the areas set out in the Industrial Strategy such as advanced connectivity technologies, artificial intelligence and space, and we intend to update further on this with the publication of our strategic plan early next year.”

The fund also emphasised that its other priority areas, transport, clean energy and advanced manufacturing, often overlapped with the tech sector and that it has made investments in electric vehicle infrastructure and chip firm Pragmatic Semiconductors.

The firm with £1bn debt

Struggling Gigaclear, which received a £100 million senior debt facility in 2021 and a £240 million guarantee in 2023, is reportedly in severe debt meanwhile. The FT reported on November 1 that the broadband provider is barely staying afloat, and may be forced to write down debt.

Asked about the reports, an NWF spokesperson told The Stack: "We continue to be supportive of the business in exploring ways to raise capital and deliver a sustainable capital structure for the company in order to grow value over the long term.

"Digital and technology is one of NWF’s priority sectors, with a particular focus on supporting altnets like Gigaclear who are delivering BDUK contracts under the government’s Project Gigabit.” 

In October, a parliamentary committee criticised the fund for its "unclear" approach to tech investments, highlighting its stated intent to invest in both "first-of-a-kind technologies" and companies at later stages of commercialisation. It warned the NWF's current size (it has been capitalised with £27.8 billion) may limit its impact on economic growth while cautioning those being overly critical of its returns, saying a 100% success rate would suggest an insufficiently "high-risk appetite."