11th May 2021
The Midlands is home to a diverse community of innovative, ambitious and resilient smaller businesses.
From an agri-robotic start-up in Shropshire that is pioneering technology to help farmers improve crop yields, to a Leicestershire gin distillery expanding into North America, the region’s businesses move ever forward – even in the face of adversity.
Of course, small businesses have faced significant challenges as a result of the Covid-19 pandemic. Evidenced in our Small Business Finance Markets 2020/21 report, almost half (45%) of UK SMEs applied for external financial support in 2020, compared to 13% in 2019,
However, looking forward, positive momentum is once again building in the region, with business confidence in the East Midlands already seeing its biggest increase in more than three years.
With the first green shoots of the region’s economic recovery appearing, businesses should prepare for the opportunities emerging in a post-Covid-19 landscape. Indeed, for some businesses, opportunities haven’t slowed due to the pandemic – as seen by those that may have changed or adapted their model, product or service to enter new markets.
The East Midlands Freeport – potentially creating up to 60,000 jobs and new export channels – combined with the roll out of the 5G testbed network in areas such as Worcestershire, represent just two of many opportunities available to the region and its businesses.
These developments are key to enabling businesses to innovate and grow, while also bolstering the region’s strengths and competitiveness, seeing continued emergence of new clusters for cyber security, medical technology and advanced manufacturing, to name a few.
Yet, without consistent access to finance, small businesses in the Midlands are unlikely to be able to fully maximise current and future opportunities. This a historic problem, with the majority of debt and equity finance still going to businesses in London and the South East.
So, the question is, what finance can small businesses in the Midlands use to pursue these new opportunities and unlock growth?
One option is the Midlands Engine Investment Fund (MEIF) which has continued to provide financial support throughout the pandemic. The fund, set up by the British Business Bank in 2017, is designed to plug gaps in access to finance for smaller businesses in the Midlands – providing equity and debt funding between £25k and £2m through its seven fund managers.
The fund recently hit its £100m investment milestone after making 481 investments in start-ups, early stage or more established small businesses located in the West Midlands and East and South East Midlands.
MEIF funding can be utilised in a range of ways, spanning purchasing equipment, entering a new market or expanding internationally. For businesses emerging out of lockdown, it may also support recruitment activity or building stock.
Some businesses may be reluctant to source external finance after taking on increased levels of debt to support cashflow during the pandemic. However, should a smaller business in the Midlands need funding to pursue a new opportunity, the MEIF’s fund managers are well equipped to look past current circumstances and recognise the potential that new finance may enable a business to achieve in the future.
Now more than ever, the MEIF is ready to fund Midlands small businesses as they drive the region’s economic recovery forward.
Ken Cooper is managing director, Venture Solutions at the British Business Bank
If you would like to meet with one of our appointed Fund Managers to talk in more detail please go to Funds Available to find the Fund Managers operating in your area
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