Woodford Investment Management

Woodford Investment Management was a prominent UK-based investment firm founded in 2014 by star fund manager Neil Woodford. Primarily known for managing equity mutual funds, most notably the Woodford Equity Income Fund, the firm attracted significant investor capital due to Woodford's strong track record at his previous employer. At its peak, the Woodford Equity Income Fund managed assets exceeding £10 billion, making it one of the largest retail funds in the UK. The firm's investment strategy focused on a concentrated portfolio of UK-listed companies, but controversially, it also held a substantial and growing proportion of its assets in illiquid, unlisted companies.

These unlisted holdings, which included stakes in promising but private biotech and technology firms, became a central point of contention. While some of these investments showed potential, their illiquid nature posed significant challenges when investors sought to redeem their money, especially during periods of underperformance in the broader portfolio. The firm faced increasing scrutiny over its valuation practices and the liquidity of its holdings, leading to a crisis of confidence among investors.

In June 2019, the Woodford Equity Income Fund was suspended, preventing investors from withdrawing their money, a highly unusual and damaging event for a retail fund. This suspension was a direct consequence of the fund's inability to meet redemption requests due to its high allocation to unlisted and difficult-to-sell assets. Following the suspension, the firm announced its intention to wind down the fund, and Woodford Investment Management itself ceased operations later that year. The collapse of Woodford Investment Management marked a significant and unfortunate chapter in UK financial history, leading to substantial losses for many retail investors. The firm was not a venture capital fund in the traditional sense, and its investments in private companies were part of a broader equity strategy rather than dedicated venture capital "first cheques" into early-stage startups. Therefore, typical venture capital check sizes are not applicable to its operational model.