A 拢660m fund that aims to boost businesses across the North wants to counter the 鈥渃omputer says no鈥 attitude of some traditional lenders, a senior executive has said.
The Northern Powerhouse Investment Fund II (NPIF II) has been launched by the British Business Bank, which was set up by the Government to increase the supply of credit to small and medium enterprises. It follows an earlier Northern Powerhouse fund, which ran from 2017 and delivered more than 拢1.1bn to businesses in the North, helping to create 8,500 jobs.
The North East LEP area was not included in the first fund, preferring to run its own operation - the North East Fund - to ensure that its European-derived funding benefitted this region specifically. But the region鈥檚 inclusion in the new fund will give fims access to small loans of between 拢25,000 and 拢100,000, debt finance from 拢100,000 to 拢2m and equity deals of up to 拢5m.
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Maven Capital Partners and NEL Fund Managers will manage the scheme in the North East, with the aim of increasing the supply and diversity of early-stage finance for Northern SMEs, as well as providing funding for fast-growing firms to create jobs. In the North West, funds will be managed by GC Business Finance & River Capital, FW Capital and Prateura Ventures; in Yorkshire and Humber it will be Business Enterprise Fund and Mercia.
Ken Cooper, managing director of venture capital solutions at the British Business Bank, said: 鈥淲e鈥檙e able to make the funding more flexible and there are far fewer restrictions. With the first Northern Powerhouse fund, there were things we couldn鈥檛 invest in, but there鈥檚 almost nothing we can鈥檛 invest in with this new fund.
鈥淲e鈥檝e also increased the funding limits a little bit and we鈥檝e done that because we鈥檙e finding that there is a shortage of private sector funding in the North. What we really don鈥檛 want to see is that we鈥檙e funding businesses in their early stages of growth and we then run out of firepower when they get to the next stage.
鈥淲e know from the research the bank has done that equity funding in particular is not as easily available in the North as it is London and the golden triangle.鈥
He added: 鈥淭he computer might say no but our fund managers may still say yes.鈥
Small Business Minister Kevin Hollinrake said: 鈥淭his new fund will unlock millions in equity and loans for SMEs across the North to realise their full potential and builds upon British Business Bank鈥檚 vital work ensuring that any small business owner in the 海角视频 can scale up and grow.
鈥淪MEs are the engines of growth for our economy and across government we are improving access to finance, cutting red tape and removing barriers to ensure that they can go further and faster than ever before.鈥
The fund is being launched today at an event in Leeds, with roadshows being held in April in Newcastle, Manchester and Sheffield. Further roadshows will also be held in Liverpool, Hull, Lancashire, Tees Valley, York, Cheshire, Durham, Cumbria and Northumberland, with details set to be announced soon. The fund is aiming to lend in 'hard to reach' parts of the North.
