The Newcastle-born head of the Sheffield-based British Business Bank (BBB) has claimed a new £660m investment fund will benefit businesses across the entire the North.
Speaking on The Northern Agenda podcast, BBB CEO Louis Taylor said that The Northern Powerhouse Investment Fund II will offer loans from £25,000 to £2m and equity investment up to £5m. The initial Northern Powerhouse Fund invested more than £400m in 2,000 Northern firms and brought in £615m in extra private sector funding.
Taylor was keen to emphasise that the funding would be distributed across the North, and not just in the traditional regional investment hubs: “I think it’s important that that money does go to a range of businesses. We’re not looking to put all of the money into the middle of Manchester, or the middle of Liverpool, or the middle of Newcastle, the money should go to genuinely regional businesses in all different sort of states of progress, and managed by local fund managers.”
The BBB’s core programmes support over £12.2bn of finance to more than 96,000 smaller businesses. It handled the government’s three Coronavirus loan schemes and its Future Fund, the latter set up to support start-up firms that would usually depend on support from private investors.
However, the bank’s own figures reveal a big geographical split in where the equity finance went. Of the 591 firms in which the Future Fund held an equity interest as of June, 295, or almost exactly half, were in London.
Taylor told the show this didn’t represent any sort of agenda, however: “I don’t think there was any skewing of the criteria towards the London companies versus the North East companies versus companies from anywhere else. This was an open scheme. And the companies that applied came from where they came from, really,” he said.
