Nest Expands Private Equity Partnership with Schroders Capital to £1.5 Billion to Drive Innovation and Support UK Growth

Nest Expands Private Equity Partnership with Schroders Capital to £1.5 Billion to Drive Innovation and Support UK Growth

(IN BRIEF) Nest has strengthened its partnership with Schroders Capital by adding £500 million to its private equity mandate, bringing the total to £1.5 billion. Schroders Capital will use the funding to invest in innovative businesses across key sectors like AI, healthcare, and technology in global and UK markets. Around 18% of Nest’s £2 billion private equity portfolio is UK-based, aligning with its broader goal of allocating 30% of its assets to private markets by 2030. Both organisations emphasised the importance of private equity in driving returns for pension savers and stimulating domestic economic growth, with Schroders leveraging its specialist investment network to identify high-potential opportunities. The partnership aligns with national initiatives such as the Mansion House Compact and further positions Nest as a leading early mover in private market investment.

(PRESS RELEASE) LONDON, 20-Oct-2025 — /EuropaWire/ — Nest, the UK’s largest workplace pension scheme representing a third of the national workforce, has increased its private equity allocation to Schroders Capital by a further £500 million, strengthening a partnership that began in 2022. The new commitment raises Nest’s total investment managed under Schroders Capital’s private equity mandate to £1.5 billion, underscoring their shared vision of harnessing private markets to deliver long-term value for pension members while supporting growth in the UK economy.

Schroders Capital, the $111 billion private markets arm of Schroders, will invest the new funding into both established and emerging companies across sectors such as artificial intelligence, healthcare, pharmaceuticals, and technology in North America, Europe, Asia, and the UK. The investments will be channelled into Nest’s default Retirement Date funds, where the majority of its 13 million members save for retirement.

Nest’s private equity portfolio now stands at around £2 billion, with approximately 18%—equating to £381 million—invested in UK-based companies. The move further supports Nest’s ambition to allocate up to 30% of its assets under management to private markets by 2030.

Rachel Farrell, Director of Public and Private Markets at Nest Invest, highlighted the value of the partnership: “Private equity deals offer exciting investment opportunities for our members. It’s right that they’re no longer out-of-reach for the average UK worker but a key component of their pension. Partnering with Schroders Capital allows us to invest in innovative, high-growth businesses while helping British enterprises expand and create new jobs. We’ve been early movers in this space and look forward to seeing our collaboration continue to deliver strong results.”

Private equity has become an increasingly attractive option for institutional investors, offering the potential for high returns and resilience amid global uncertainty. According to Schroders’ Global Investor Insights Survey, private equity was rated as the most favoured asset class for returns among institutional investors in 2025. Schroders Capital’s established network of specialist fund managers provides access to growth and buyout opportunities that would otherwise be out of reach for most pension schemes, having already invested in over 25 companies across multiple regions.

Tim Creed, Head of Private Equity Investments at Schroders Capital, commented: “There is a compelling opportunity for UK savers to invest in private markets and shape their futures—maximising pensions while fueling innovation and growth in the wider economy. This expanded commitment from Nest reflects our shared success in unlocking high-quality private equity opportunities, and we are proud to continue building a partnership that benefits millions of UK savers.”

Schroders has been at the forefront of expanding private market access through innovative structures such as the Long-Term Asset Fund (LTAF)² —a regulatory framework that enables long-term investors to invest efficiently in illiquid assets. The firm launched the UK’s first LTAF in 2023, followed by the first LTAF dedicated to UK venture capital.

Nest’s expanded mandate with Schroders Capital reinforces the momentum of the Mansion House Compact and Accord initiatives, which call for greater investment in UK unlisted equities and infrastructure. The collaboration continues to play a vital role in connecting pension capital with innovation-led business growth while ensuring long-term benefits for members and the wider economy.

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

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.

SOURCE: Schroders