British Business Bank launches £140m East of England Investment Fund

The British Business Bank has launched a new £140 million investment fund to improve access to finance for smaller businesses across the East of England.

The East of England Investment Fund will provide a combination of debt and equity finance to SMEs in Essex, Suffolk, Hertfordshire, Norfolk and Cambridgeshire, with loans ranging from £25,000 to £2 million and equity investments of up to £5 million.

The launch means the British Business Bank is now delivering targeted finance across every UK nation and region outside London, as part of efforts to support business investment and economic growth across the country.

The new fund is intended to help smaller businesses start, scale and grow, supporting investment, innovation and job creation across an area with particular strengths in sectors including life sciences, advanced manufacturing, technology, clean energy and agri-tech.

“The East of England is home to some of the UK’s most innovative and enterprising businesses, from world leading life sciences to advanced manufacturing and agri-tech.

“The launch of the East of England Investment Fund will play a crucial role in stimulating growth throughout the region by ensuring its businesses have access to the finance they need and deserve.”

The British Business Bank highlighted a disparity between the East of England’s contribution to innovation and the amount of equity investment reaching businesses in the region.

The East of England is home to 15% of the UK’s university spinout businesses but received only 9% of total UK equity investment by value last year.

The new fund is expected to help bridge the gap between academic innovation and commercial deployment by providing growing businesses with access to finance at different stages of their development.

Science, Innovation and Investment Minister Chris McDonald said: “The East of England is home to small and medium sized businesses that are locally significant and internationally competitive. Many of these are in sectors such as life sciences, technology and clean energy that are growing quickly.

“These businesses need financial support to grow and take advantage of new market opportunities, but I know from my own experience that it isn’t easy if you are located outside of London.”

McDonald said the fund forms part of the Government’s ambition to spread economic growth across the UK and improve businesses’ access to finance outside the capital.

The £140 million fund will be delivered by two fund managers appointed by the British Business Bank.

Eastmeare, part of Beechbrook LLP, will manage the debt finance element, providing loans ranging from £25,000 to £2 million.

Mercia Ventures, part of Mercia Asset Management PLC, will manage the equity element, with investments of up to £5 million available to eligible businesses.

By combining debt and equity options, the fund is designed to serve businesses with different financing requirements and at different stages of their growth.

The East of England Investment Fund forms part of the British Business Bank’s wider programme of regional investment funds, aimed at addressing geographic disparities in access to finance and increasing the supply and diversity of funding available to smaller businesses throughout the UK.