Schroders Capital receives £500m from Nest for further private equity investment

Nest, the UK’s largest workplace pension scheme with over 13 million members, has committed an additional £500 million to Schroders Capital, bringing the total managed under its private equity mandate to £1.5 billion.

Schroders Capital now responsible for £1.5bn on behalf of Nest
Nest’s private equity investment stands at around £2bn
18% (£381m) of Nest’s private equity investment is UK based

Nest, the pension scheme representing a third of the UK workforce, has provided Schroders Capital, the $111 billion private markets business of Schroders, with a further £500 million to be invested through its private equity mandate.

The fresh allocation strengthens the successful partnership which began in 2022 and brings Nest’s total committed capital to Schroders Capital’s private equity strategy to £1.5 billion.

Schroders Capital’s mandate is to invest in both established and young businesses at the forefront of innovation, in growth sectors such as artificial intelligence, healthcare, pharmaceuticals and technology across North America, Asia and Europe, including the UK.

A total of £1.5 billion has now been committed through the bespoke fund managed by Schroders Capital, feeding into Nest’s default ‘Retirement Date’ funds where the vast majority of its 13 million members save.

Nest and Schroders Capital share the belief that scaling up private market investments can not only drive stronger long-term return potential for members but also support growth in the UK economy. Across its portfolio, Nest has around £2 billion directly invested in unlisted equity, of which nearly all is invested through its default funds and around 18% (£381 million) is to UK companies.

Rachel Farrell, Director of Public and Private Markets at Nest Invest, has praised Schroders Capital in helping Nest’s members benefit from these types of high-value deals.

“Private equity deals offer exciting investment opportunities for our members. It’s right that they’re no longer out-of-reach of the average UK worker but a key component of their Nest pension.

“We want to keep growing our investment into this high-performing asset class. This supports our overall ambition - to expand our private market (illiquid) allocation to 30% AUM by 2030.

“We’re delighted to be partnering with Schroders Capital. They share our desire, as a UK based asset manager leading the way in private markets, to help British businesses grow and in turn create more jobs and opportunities for UK savers.

“What we’re seeing through both the Mansion House Compact and Accord is more appetite from institutional UK investors to access private equity. We’ve enjoyed being an early mover into the market and our challenge to Schroders Capital is keep up the hard work in what will become a more competitive market.”

Investors, like Nest, are increasingly turning to private markets to access attractive return and income opportunities, as highlighted within Schroders’ latest Global Investor Insights Survey[1]. Across both public and private markets, private equity was selected as the most favoured asset class for return opportunities among institutional investors. With this, smaller, innovation-rich and domestically focused companies that are inaccessible via public markets can be less exposed to global trade disruptions and geopolitical tensions, and therefore, have the potential to also enhance portfolio resilience – a particularly pertinent factor in today’s market context.

Schroders Capital’s private equity platform has built a deep network of proven specialist managers, allowing them to unlock access to untapped growth and value creation opportunities that otherwise would be unavailable to Nest’s members. With a strategic focus on growth and buyout in the lower-mid market, Schroders Capital has built a globally diversified portfolio and successfully invested in over 25 companies across the UK, Europe, North America and Asia.

The combination of Nest’s ability to raise capital at pace with Schroders Capital’s specialisms has been key to sustaining robust deployment momentum.

Tim Creed, Head of Private Equity Investments, Schroders Capital, commented:

“There is a compelling opportunity for UK savers to invest in private markets and shape their futures: maximising their pensions whilst spurring the evolution of companies driving critical innovation and growth. The UK’s pensions industry is no doubt waking up to the private equity sector’s potential to drive value for individual savers, businesses and the broader economy, and it’s promising to see this being reflected in increasing investor sentiment.

“Success hinges on the expertise of specialist managers. We are uniquely positioned here – leveraging the reach and client network of the broader Schroders Group, combined with the specialist capabilities and proven track record of Schroders Capital.

“This further commitment from Nest not only strengthens our partnership but also serves as testament to the success of our strategy. We look forward to building on this momentum as we continue to unlock untapped opportunities for millions of savers across the UK.”

Schroders has established itself as a market leader in unlocking access to private markets through innovative fund vehicles and structures. Paving the way for the DC market, the firm launched the first ever Long-Term Asset Fund (LTAF)[2] in 2023, and more recently, the first LTAF dedicated to UK venture capital.

If you have specific questions for Schroders Capital, please contact:

Rachael Dowers, Media Relations Lead, Private Markets
+44 207 658 2086
rachael.dowers@schroders.com

Jessye Brandon, PR Manager
+44 207 658 3789
jessye.brandon@schroders.com

Notes to editors

*Details above relating to Nest’s asset allocation using data as of June end 2025. Nest’s private equity deals valued as of March end 2025.

In July 2023, 11 pension schemes signed the Mansion House Compact, committing these firms to allocate 5% of their assets in default funds to unlisted equities by 2030.

The 17 signatories of the Mansion House Accord, of which Nest is one, have pledged to invest 10% of its workplace portfolios in assets that bolster the UK economy such as infrastructure, property and private equity by 2030 – with at least 5% of these portfolios to be invested in the UK.

Nest has two mandates in place to invest in private equity, one with Schroders Capital and another with HarbourVest. The £1.5 billion figure referenced in the press notice is the committed capital from Nest to Schroders Capital, which includes money invested in deals and ‘dry powder’ of money yet to be deployed. The around £2 billion figure also referenced in the release is the amount of money invested on behalf of Nest i.e. money that’s been ‘put to work’ into private equity deals, across its two private equity funds and part ownership in Industry Super Holdings Pty. Ltd.

Nest’s allocation to private equity deals, as a proportion of its total assets under management, is 3.9%. All investment fees are incorporated in Nest’s existing charging structure, meaning there is no additional charge on members for investing in private equity.

Nest

Since its creation in 2012, following the introduction of auto enrolment, Nest has grown to become the largest workplace pension scheme in the country with more than 13 million UK members. Around one in three of the UK working population has a Nest pension pot.

Nest’s members benefit from an award-winning investment strategy and one of the most diversified DC portfolios in the UK. It practices responsible investment that aims to deliver long-term growth while carefully managing risk.

Nest manages more than £53 billion in assets on its members’ behalf. It receives more than £500 million a month in new contributions and by the end of the decade, Nest is expected to have £100 billion in assets under management.

Schroders Capital

Schroders Capital provides investors with access to a broad range of private market investment opportunities, portfolio building blocks and customized private market strategies. Its team focuses on delivering best-in-class, risk-adjusted returns and executing investments through a combination of direct investment capabilities and broader solutions in all private market asset classes, through comingled funds and customized private market mandates.

The team aims to achieve sustainable returns through a rigorous approach and in alignment with a culture characterized by performance, collaboration and integrity.

With $111 billion (£81 billion; €94.5 billion)* assets under management, Schroders Capital offers a diversified range of investment strategies, including real estate, private equity, secondaries, venture capital, infrastructure, securitized products and asset-based finance, private debt, insurance-linked securities and BlueOrchard (Impact Specialists).

*Assets under management as of June 30, 2025 (including non-fee earning dry powder and in-house cross holdings)

[1] https://www.schroderscapital.com/en/global/professional/insights/private-equity-and-credit-seen-as-key-for-investors-to-navigate-market-uncertainty/

[2] LTAFs are regulated open ended investment vehicles designed to enable a broader range of investors, with longer term horizons, to invest efficiently in illiquid and private assets.

LikeDiscussion

Discussion

You are commenting on Schroders Capital receives £500m from Nest for further private equity investment

You must be logged in to add a comment

There are no comments

Be the first to add to the discussion

Fund manager

Schroders Greencoat LLP

London, United Kingdom

Schroders Greencoat is a specialist investment manager dedicated to renewable infrastructure, with over £8.5 billion under management. We aim to provide strong risk-adjusted returns for our investors, while also delivering positive environmental outcomes. Founded in 2009, Schroders Greencoat has built a reputation for unwavering delivery of our investment propositions, as well as for innovation – our offerings have become the model for an entire industry sector. Our investments span the globe, with local expertise in the Europe, the UK and the US, and are managed across a range of publicly listed vehicles*, private market pooled funds, co-investment vehicles and Separate Managed Accounts. Renewable infrastructure is a multi-trillion dollar global sector that will grow by more than $100 billion a year over the next decade. Utilities, energy companies and infrastructure developers will build out the majority of this transition, but the scale of capital involved will require significant private financing. There exists a very large and growing pool of capital which is keen to own and operate these assets, but lacks the inhouse technical skills and sector expertise to manage the investments independently. Our purpose is to bridge this gap, by acting as a solution provider for investors, and providing the partnership, financial, technical and operational expertise to deliver secure incomes for our clients. Acquired by Schroders plc in 2022, Schroders Greencoat is the fourth pillar of the group's private markets investment business, Schroders Capital. Schroders Capital through Schroders Greencoat has the ambition to become a global leader in infrastructure and the alternative investment industry more broadly. * Schroders Greencoat is the investment manager for two listed vehicles, Greencoat UK Wind PLC and Greencoat Renewables PLC.

infrastructure