16 business focus
Job creation at the heart of new loan fund for high-growth businesses
A unique initiative led by the Thames Valley Berkshire Local Enterprise Partnership (TVB LEP) now offers fast-growing businesses access to loans worth a total of £7.25 million
The new Funding Escalator, divided into three complimentary but distinct funds depending on the profile and need of the business, is designed to help companies who have the potential to deliver high growth and create jobs for the local economy.
Working alongside the TVB LEP to manage and deliver the programme are The FSE Group, an independent not-for-profit community interest company, and VitalSix, which specialises in helping potential high growth businesses source the funding they need.
The Business Magazine asked Tim Smith (TS), business director of TVB LEP, Kevan Jones (KJ), CEO of The FSE Group, and Ed Cooper (EC), co-founder of VitalSix, to explain how the scheme works. Joining them was Emma Gibson (EG), corporate partner with Shoosmiths, director of TVB LEP and chair of the access to finance forum.
TS: The LEP was allocated circa £15m capital as part of the Government’s Growing Places Fund, which puts the emphasis on growing the local economy, infrastructure, housing and jobs. It was clear in terms of job creation that we needed to create the next generation of successful businesses, which is why we dedicated a significant proportion of the money to the Escalator Fund; a unique approach to the use of the Growing Places Fund.
EG: Start-ups and smaller businesses often find it difficult to obtain funding. Our focus is on helping SMEs with a strong growth agenda, highly-scalable businesses which have the ability to become the next big employers in Berkshire and the Thames Valley. The three separate funds enable us to reach businesses at different points in their development and, by partnering with The FSE Group and VitalSix, we are using tried and tested means of getting the money out into the business community in a manner which is as efficient and effective as possible.
EC: Our role is to help businesses make sure they are ready to apply for loan funding by providing coaching and support, effectively helping them to sell themselves. If they are better prepared, businesses are much more likely to be
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Emma Gibson
KJ: Before applying for a loan, the most important element is to make sure there is a business plan in place which sets out the company’s strategy for growth. That enables us to make a full assessment and look at the real potential for the business. Visit the FSE website for full details of the categories and, if it isn’t clear, call us for advice. We want to attract as many businesses as we can and hear from exciting businesses about their ideas for future success and job creation.
Tim Smith
successful in achieving finance. We also believe this initiative can open the door to other future opportunities, such as further investment or private funding and, because we have effectively prepared the ground, it is much easier for other investors to come on board.
KJ: The scope of the loans means we hope to attract ambitious companies with exciting plans to grow, whether that’s expanding facilities, taking on staff, developing different product streams or looking at new export markets. The fund managers working with the businesses will be with them for the next four or five years, providing real continuity and understanding as well as practical support.
EC: Not only is there funding potentially going in, this is about a real desire to help people develop their business. It’s important this scheme isn’t just seen as a source of money; the commitment is there to do so much more.
TS: Although the TVB LEP is publicly funded, we are very much a business-led body; it is the credentials of our team and our partners who make us what we are.
In our first year we spent a lot of
time talking to businesses so we knew that access to finance was a key strategic priority and our goal with the Escalator Fund is to help as many companies as possible across a range of sectors, over the lifetime of the fund.
TVB Commercialisation Loan Scheme
– provides loans from £25,000 to £50,000 to early stage SMEs that have generated some sales and require funding support to boost their profile and improve growth. A typical company may have had its first year trading and need to fund a website or marketing campaign.
TVB Expansion Loan Scheme
– provides loans from £50,000 to £200,000 for established SMEs with annual sales of £250,000 or more, who need additional finance to scale up the business and expand activities in order to deliver substantial growth.
TVB Growth Loan Scheme
– invests up to £300,000 through a mix of matched loan and equity funding and is aimed at ambitious growing businesses which need support through their next phase of growth by providing finance, expertise and assistance with contacts.
Details:
Tim Smith
tim@thamesvalleyberkshire.co.uk www.thamesvalleyberkshire.co.uk
Kevan Jones
kevan.jones@
thefsegroup.com www.thefsegroup.com
Ed Cooper
ed.cooper@
vitalsix.co.uk www.vitalsix.co.uk
THE BUSINESS MAGAZINE – THAMES VALLEY – MARCH 2013
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