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The UK’s home for tokenised equity. Independent news, insight and resources for founders raising capital, investors deploying it, and the firms supporting both — as the regulation, infrastructure and opportunity converge.

UK Pension Default Funds Have Invested Just 0.6 Per Cent of Assets in Private Markets Under the Mansion House Accord,

  • Writer: Shawn Jhanji
    Shawn Jhanji
  • Jul 22
  • 4 min read
Ask a UK founder why the biggest cheques in their round come from Boston or San Francisco rather than London, and the honest answer usually traces back to where the money sits, not who is willing to write it. Startup Coalition, the industry body representing UK founders and scaleups, published an analysis this week arguing that the country's own pension savings are a large part of that answer, and that progress on fixing it is running dangerously behind schedule. The Mansion House Compact, launched by then Chancellor Jeremy Hunt in 2023 and extended by Rachel Reeves as the Mansion House Accord in May 2025, asked seventeen of the UK's largest workplace pension providers, managing the bulk of the country's defined contribution savings, to commit to investing at least 10 per cent of their default funds in private markets by 2030, including venture capital, private equity, infrastructure and unlisted equity. The ambition was to unlock tens of billions of pounds for exactly the kind of high growth, early stage businesses that struggle to raise from UK sources alone. Three years on, Startup Coalition's analysis, published on its Substack, puts a hard number on how far short of that ambition the industry has fallen. The average allocation to unlisted equities across signatory default funds sits at 0.36 per cent, rising only to around 0.6 per cent more recently. Against a 2030 target of 10 per cent, that leaves the industry roughly a tenth of the way to a goal that is now more than halfway through its own deadline.

Ask a UK founder why the biggest cheques in their round come from Boston or San Francisco rather than London, and the honest answer usually traces back to where the money sits, not who is willing to write it.


Startup Coalition, the industry body representing UK founders and scaleups, published an analysis this week arguing that the country's own pension savings are a large part of that answer, and that progress on fixing it is running dangerously behind schedule.


The Mansion House Compact, launched by then Chancellor Jeremy Hunt in 2023 and extended by Rachel Reeves as the Mansion House Accord in May 2025, asked seventeen of the UK's largest workplace pension providers, managing the bulk of the country's defined contribution savings, to commit to investing at least 10 per cent of their default funds in private markets by 2030, including venture capital, private equity, infrastructure and unlisted equity. The ambition was to unlock tens of billions of pounds for exactly the kind of high growth, early stage businesses that struggle to raise from UK sources alone.


Three years on, Startup Coalition's analysis, published on its Substack, puts a hard number on how far short of that ambition the industry has fallen. The average allocation to unlisted equities across signatory default funds sits at 0.36 per cent, rising only to around 0.6 per cent more recently. Against a 2030 target of 10 per cent, that leaves the industry roughly a tenth of the way to a goal that is now more than halfway through its own deadline.


Startup Coalition frames the human cost of that gap in a single comparison. On identical contributions over an identical working life, it argues, the average British saver retires 144,485 pounds worse off than a Canadian counterpart, because Canadian and Norwegian pension funds hold meaningfully more of their own economy's growth companies, while UK default funds remain concentrated in listed equities and bonds.


The analysis also points to a structural shift working against UK savers over time. When Microsoft and Amazon floated, their public listings happened at valuations under a billion pounds, letting an ordinary tracker fund capture almost the entire growth story.


Today's equivalent companies, OpenAI among them, are reaching valuations in the hundreds of billions or more while still private, meaning the growth increasingly happens before a listed fund can touch it.


That last point is where this story connects to the wider argument this publication has been making about tokenisation and PISCES. If the most consequential growth in a company's life is increasingly happening while it is still privately held, then the mechanisms that let capital reach private companies, and let holders realise value from them, become the more important plumbing to get right.


Pension reform is one route into that problem: get default funds allocating meaningfully to unlisted equity and venture capital, and more UK growth capital reaches founders directly. Tokenised equity paired with PISCES trading windows is a complementary route. It gives the investors backing those private companies, pension funds among them in time, a credible path to liquidity before a traditional exit event, which in turn makes it easier to justify holding illiquid private positions in a vehicle that ultimately has to pay out to savers on a defined timetable.


Neither mechanism solves the problem alone. Pension trustees still have legitimate, unresolved questions about liquidity, valuation and fiduciary duty when it comes to holding unlisted assets inside a default fund built for millions of ordinary savers, and nothing about tokenisation changes those duties. What tokenisation and PISCES can plausibly do is narrow the liquidity gap that makes trustees nervous in the first place, without requiring the underlying investment thesis, backing UK growth companies, to change at all.


The open question, as we see a ne Chancellor walk through the door, is whether the reserve powers Parliament has given government to mandate pension allocations will actually be used if voluntary progress continues at 0.6 per cent a year, and whether better secondary liquidity infrastructure would change that calculus for trustees before compulsion becomes necessary.


Startup Coalition's analysis names individuals who have worked on this brief for successive governments, including the former Chancellor's Entrepreneurship Advisor Alex Depledge, Pensions Minister Torsten Bell, former Chancellor Jeremy Hunt and British Business Bank chief executive Louis Taylor, as evidence that the policy direction has rare cross party consensus. Consensus on direction has not, so far, translated into pace.


This publication would welcome perspectives from pension trustees, the British Business Bank, and PISCES operators on whether secondary liquidity infrastructure is a meaningful lever on this specific problem, or a separate conversation entirely. Comment can be directed to news@tokenisingstartups.com.


This piece is general information and reflects an open editorial question, not investment or pensions advice.


Key Takeaways


  • Startup Coalition analysis published 17 July finds UK pension default funds have allocated around 0.6 per cent of assets to private markets, against a 10 per cent target for 2030 under the Mansion House Accord.

  • The analysis estimates the average UK saver retires 144,485 pounds worse off than a Canadian counterpart because UK default funds hold proportionately fewer unlisted growth assets.

  • Companies including OpenAI are reaching valuations in the hundreds of billions while still private, meaning an increasing share of value creation happens before listed funds can access it.

  • Government holds reserve powers to mandate pension allocations to qualifying private assets if voluntary progress continues to lag, though these have not been exercised.

  • Tokenised equity paired with PISCES trading windows is offered here as one plausible way to narrow the liquidity concerns that make pension trustees cautious about unlisted allocations, without altering trustees' underlying fiduciary duties.


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