As ever-larger companies stay unlisted, The Schiehallion Fund traverses the divide between private and public markets as Baillie Gifford's Gustav Venter explains.
Over the next day, notice how many times you make a digital payment. It may be processed behind the scenes by the payment infrastructure provider Stripe. Then think about how often you scroll through a short-form video, perhaps on TikTok, which is owned by the Chinese company ByteDance.
Consider how often what you encounter online is being shaped by artificial intelligence (AI)-driven personalisation – with developers such as Anthropic providing the AI models and Databricks supplying the tools to store, manage and use data for AI.
These companies have two things in common. First, they are private, meaning their shares are not listed on a stock exchange. Second, they are all holdings within the Schiehallion Fund, a UK investment trust launched in 2019 and listed on the London Stock Exchange (LSE).
Companies are staying private for longer
Many of the world's most innovative businesses are staying private for longer. A decade ago, the typical company reached the stock market in under seven years. Now that figure is closer to eleven.
While significant innovation has always occurred in private markets, consumers often did not encounter these companies or their products until after they listed. Amazon is a case in point: it listed as an online bookstore in 1997, only later growing into the behemoth that it is today.
The result has been the emergence of private ‘megacaps' – companies valued in the tens or hundreds of billions of dollars, such as SpaceX ($800bn valuation according to year-end public estimates), ByteDance ($480bn) or Anthropic ($350bn). They would all rank among some of the largest public companies in their respective geographies if they were listed.
This creates a challenge for investors – how do you invest in growth businesses that are not listed, as they would traditionally have been?
At Baillie Gifford, we began noticing this change in the early 2010s. At the time, we were increasingly meeting private companies with fast-growing revenues and scalable business models – on substance, looking just like the companies we had always invested in, but on the other side of the artificial initial public offering (IPO) divide.
A decade-plus backing private leaders
And that is why we made our first investment in Alibaba in 2012. Since then, we have invested over $10bn in more than 160 private growth companies worldwide.
Of course, the best private companies have the luxury of choosing their shareholders and Baillie Gifford's reputation as long-term, patient shareholders within the public markets proved to be a great advantage: it made us natural partners for growth companies with the ambition to one day become listed businesses.
Fit for the private-first era
This ultimately led to the launch of the Schiehallion Fund in 2019 – our first portfolio fully dedicated to pursuing new investments in private growth companies.
Schiehallion has continued to mature over its nearly seven-year existence. This included an additional capital raise in 2021, a challenging 2021-22 capital cycle, and a strong performance rebound over the past two years. More recently in December 2025 the Fund also changed its listing segment on the LSE, thereby expanding the accessibility of its shares to a wider range of investors.
Today, the Fund is fully deployed. The portfolio includes six of the world's ten most valuable private growth companies, as well as businesses that grew rapidly outside of the traditional venture capital (VC) route where early stage funding is provided by VC firms.
Bending Spoons
A notable example is Bending Spoons – an Italian company that acquires digital products with loyal paying subscribers, and uses its fantastic talent pool and internal tools to improve both the products and businesses around these products.
It has turned Milan into a centre of gravity for engineering talent and is giving a second act to much-loved digital products such as Evernote, Vimeo or AOL. The leadership team's exceptional execution has powered explosive growth, with no signs of slowing.
In the process, the company's valuation today is more than ten times that of the Fund's entry valuation when we first invested less than three years ago, making it the largest holding in Schiehallion by the end of 2025.
Ready for the future
With the Fund fully invested, what does the future hold? Since its inception, 11 holdings have listed after initially having been bought while private. The Fund's evergreen structure, with no fixed end date, allows it to continue holding companies beyond their eventual IPO dates.
That allows shareholders to continue benefiting from growth after the underlying holdings enter public markets, and also serves as a source of funding for new exceptional private companies, wherever they may be located around the globe.
The 2022 market reset was painful. However, the companies that managed to navigate their way through those challenging conditions now have stress-tested business models. The market reset has brought with it a more favourable valuation environment within which to deploy capital over the past two years.
We believe that companies will continue to spend a longer part of their growth journey outside of public markets, which makes us excited about pursuing the next generation of market leaders on behalf of Schiehallion shareholders.
Find out more about Schiehallion
The Schiehallion Fund Limited
Annual past performance to 31 December each year (%)
|
|
2021 |
2022 |
2023 |
2024 |
2025 |
|
Share Price |
101.4 |
-66.8 |
-21.3 |
47.3 |
29.8 |
|
Net Asset Value |
40.4 |
-34.2 |
-0.6 |
11.1 |
34.9 |
Source: Morningstar. Total return in USD. Ordinary shares.
Past performance is not a guide to future returns.
The base currency of the Trust is US Dollars. Where an investor holds shares priced in US Dollars, their return in any currency other than US Dollars will also be affected by exchange rate movements.
Important information
This communication was produced and approved in February 2026 and has not been updated subsequently. It represents views held at the time of writing and may not reflect current thinking.
Private Company assets may be more difficult to buy or sell, so changes in their prices may be greater. There is no guarantee that private companies will become publicly traded companies in the future.
This communication does not constitute, and is not subject to the protections afforded to, independent research. Baillie Gifford and its staff may have dealt in the investments concerned. The views expressed are not statements of fact and should not be considered as advice or a recommendation to buy, sell or hold a particular investment. A Key Information Document is available at bailliegifford.com.
