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UK PE industry generates £5.4bn in fee income for financial services sector22/01/2008. Source: AltAssets. 
 The latest piece of research published by The British Private Equity and Venture Capital Association confirms that the private equity industry has become a major force in the British economy. The UK private equity industry generated a total of £5.4bn of income for the financial and professional services sector in the financial year 2006-2007. This figure represents 12 per cent of the total annual revenue of the UK financial services industry, according a study entitled The Impact of Private Equity as a UK Financial Service 2006/7, conducted by Arbor Square Associates on behalf of the BVCA.
With a total of about £1.7bn, corporate finance and accountancy firms accounted for the lion’s share of the £5.4bn generated in fee income, followed by banking and finance providers (£1.2bn) and legal firms (1.2bn).
While London was the focus of activity, a significant £1bn was generated outside the capital.
The UK counts almost 450 private equity, venture capital, funds of funds and secondaries investment firms, employing more than 9,300 people. In addition to that, the research stresses the so called ‘multiplier effect’: ‘For every private equity executive investing directly in UK companies, there are 2.2 full-time equivalent advisors or finance executives providing specialist advice and services,’ it says in the report.
Overall, more than 18,000 people are employed either directly or indirectly by private equity in the UK, the vast majority of them in highly skilled jobs.
Speaking at the report’s launch at the London Stock Exchange, BVCA chief executive Simon Walker said, ‘This report shows just how important the private equity industry is to the UK economy and the financial services industry. It confirms something that many of us have known for some time: we are part of the economic mainstream. In these uncertain economic times private equity has, more than ever, a critically important role to play in making the economy more productive and helping to stimulate economic growth.’
Arbor Square surveyed over 250 BVCA members and associate members, including private equity and venture capital houses, funds of funds, secondary investors and financial and professional services firms. The research phase took place between May and August 2007.
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