Midlands Engine Investment Fund making an immediate impact and generating over £64m of investment in Midlands’ businesses
- Publication of MEIF Early Assessment Report reveals early impact on Midlands productivity
- 629 jobs created after £64.8m invested in 257 Midlands’ businesses
- Increasing Research, Development and Innovation investment by small growing businesses
- 60 per cent of investee businesses report increased turnover with high export rates
- MEIF continues to invest throughout the COVID-19 outbreak
Over £64.8 million has been invested into 257 businesses by the Midlands Engine Investment Fund (MEIF), with new data revealing its regional impact released today (20 May, 2020).
The £250 million Fund, which was launched by the Government’s British Business Bank in 2017 to support small businesses in the Midlands, has helped to create 629 jobs, with 37 per cent paying above the UK upper quartile salary of £36,500 a year.
The new data has been released as part of an Early Assessment Report which charts the Midlands Engine Investment Fund’s progress between August 2017 and September 2019. The report was carried out by economic researchers SQW, supported by the Centre for Enterprise and Economic Development Research at Middlesex University, Belmana and BMG Research.
The report has found that the reasons for setting up the MEIF remain robust and highly relevant, spotlighting its impact in improving the delivery of equity finance in the Midlands after supporting 20% of all equity deals in the region. Key findings from the report include:
- 90 per cent of researched investee businesses confirmed that the additional equity funding they raised was either ‘entirely’ or ‘largely’ attributable to the MEIF
- 68 per cent of businesses had used investment to increase skills in their workforces
- Across debt and equity deals, 37 per cent of businesses stated that that they would either ‘probably not’ or ‘definitely not’ have secured finance without the Fund
- 84 per cent of businesses revealed they now have a greater confidence in raising private sector finance
- 85 per cent of equity deals and 44 per cent of debt funding was used to increase investment in research anddevelopment and innovation, leading to new products to be developed, including medicines and medical therapies.
- 58 per cent of investee businesses receiving debt and 30 per cent securing equity identified as exporting products or services. This is in contrast to national export estimates varying from 9 per cent to 20 per cent for all SMEs
The MEIF is continuing to invest via its seven fund managers throughout the COVID-19 outbreak. A Black Country-based designer and manufacturer of power supply units and battery charging systems is one of the latest businesses to secure a funding boost.
PSU Designs, which has a large design and manufacturing facility in West Bromwich, secured an £85,000 investment from BCRS via the Midlands Engine Investment Fund (MEIF) and in conjunction with the Coronavirus Business Interruption Loan Scheme (CBILS).
The Fund also recently supported a £1.2 million funding round for Coventry-based Sarissa Biomedical which has developed a potentially lifesaving device for diagnosing strokes.
Communities Secretary and Midlands Engine Champion Rt Hon Robert Jenrick MP said:
“We recognise that small businesses have faced significant challenges over the last few months as a result of the coronavirus pandemic and we have ensured financial support is available to businesses across the Midlands who are in need of it.
“Our Midlands Engine Investment Fund bolsters and strengthens our great Midlands businesses for the future. As the Midlands Engine Champion in the Cabinet I am delighted that over £64m has now been invested into over 250 businesses.
“A thriving Midlands Engine is pivotal to the nation’s economy and this fund will play its role in levelling up the region.”
Patrick Magee, Chief Commercial Officer at the British Business Bank, said:
“The last few months have not been easy for small businesses in the UK. This includes the Midlands, where the British Business Bank has already identified a gap in the provision of SME finance. This new report, however, reveals that through the MEIF we are making a positive difference, with the region’s businesses accessing investment to develop innovative products, hire and upskill staff, and most importantly grow.
“The MEIF is key to driving forward the Midlands Engine economy. We are committed to building on the Fund’s progress and sustaining strong levels of support; the Bank is also operating a range of other initiatives to enable businesses to access finance at this time.”
Jon Corbett, Chair of the Midlands Engine Investment Fund’s Strategic Oversight Board, said:
“Through our seven fund managers, a strong network of LEPs and intermediaries, we continue to foster a real sense of regional collaboration. This has been pivotal to the impact the Fund has made across the Midlands, it will continue to play an important role as MEIF remains very much open for investment during these unprecedented times.”
The Midlands Engine Investment Fund project is supported financially by the European Union using funding from the European Regional Development Fund (ERDF) as part of the European Structural and Investment Funds Growth Programme 2014-2020 and the European Investment Bank.
Notes to editors
Communities Secretary and Midlands Engine Champion Rt Hon Robert Jenrick MP
Patrick Magee, Chief Commercial Officer at the British Business Bank
Dr John Clarkson, CEO Sarissa Biomedical
Tom Bradshaw-Smith, Story Comms
firstname.lastname@example.org / 07432 460 225
Lewis Thomas, Story Comms
email@example.com / 07823 335 659
Lauren Tunnicliffe, British Business Bank
Lauren.firstname.lastname@example.org / 07557 205044
About the Midlands Engine Investment Fund (MEIF)
The Midlands Engine Investment Fund, supported by the European Regional Development Fund, will invest in Debt Finance, Small Business Loans, Proof-of-Concept and Equity Finance funds, ranging from £25,000 to £2m, specifically to help small and medium sized businesses secure the funding they need for growth and development.
The Midlands Engine Investment Fund is operated by British Business Financial Services Limited, wholly owned by British Business Bank, the UK’s national economic development bank. Established in November 2014, its mission is to make finance markets for smaller businesses work more effectively, enabling those businesses to prosper, grow and build UK economic activity.
The Midlands Engine Investment Fund is supported by the European Regional Development Fund, the European Investment Bank, the Department for Business, Energy and Industrial Strategy and British Business Finance Limited, a British Business Bank group company.
The MEIF covers the following LEP areas: Black Country, Coventry & Warwickshire, Greater Birmingham & Solihull, Stoke-on-Trent and Staffordshire, The Marches, and Worcestershire in the West Midlands; and Derby, Derbyshire, Nottingham & Nottinghamshire (D2N2) Greater Lincolnshire, Leicester and Leicestershire, and South-East Midlands in the East and South-East Midlands.
The project is receiving up to £78,550,000 of funding from the England European Regional Development Fund as part of the European Structural and Investment Funds Growth Programme 2014-2020. The programme will continue to spend to the end of 2023.
The Ministry for Housing, Communities and Local Government is the Managing Authority for European Regional Development Fund. Established by the European Union, the European Regional Development Fund helps local areas stimulate their economic development by investing in projects which will support innovation, businesses, create jobs and local community regenerations. For more information visit www.gov.uk/european-growth-funding.
The Government has guaranteed all funding allocated through EU programmes until the end of 2020. https://www.gov.uk/government/news/funding-from-eu-programmes-guaranteed-until-the-end-of-2020.
The European Investment Bank is providing £122,500,000 to support the Midlands Engine Investment Fund. This follows backing for the Northern Powerhouse in 2017 and backing for the newly launched North East Fund. For further information visit www.eib.org.
The funds in which Midlands Engine Investment Fund invests are open to businesses with material operations in or planning to open material operations in the West Midlands and East & South-East Midlands.
About the British Business Bank
The British Business Bank is the UK government’s economic development bank. Established in November 2014, its mission is to make finance markets for smaller businesses work more effectively, enabling those businesses to prosper, grow and build UK economic activity. Its remit is to design, deliver and efficiently manage UK-wide smaller business access to finance programmes for the UK government.
The British Business Bank programmes are supporting more than £7.2bn of finance to over 93,000 smaller businesses (as at end of September 2019).
As well as increasing both supply and diversity of finance for UK smaller businesses through its programmes, the Bank works to raise awareness of the finance options available to smaller businesses:
- The Business Finance Guide (published in partnership with the ICAEW and a further 21 business and finance organisations) impartially sets out the range of finance options available to businesses at all stages – from start-ups to SMEs and growing mid-sized companies. Businesses can take the interactive journey at thebusinessfinanceguide.co.uk/.
- The British Business Bank Finance Hub provides independent and impartial information to high-growth businesses about their finance options, featuring short films, expert guides, checklists and articles from finance providers to help make their application a success. The new site also features case studies and learnings from real businesses to guide businesses through the process of applying for growth finance.
As the holding company of the group operating under the trading name of British Business Bank, British Business Bank plc is wholly owned by HM Government and is not authorised or regulated by the Prudential Regulation Authority (PRA) or the Financial Conduct Authority (FCA). The British Business Bank operates under its own brand name through a number of subsidiaries, none of which are authorised and regulated by the FCA.
British Business Bank plc and its principal operating subsidiaries are not banking institutions and do not operate as such. A complete legal structure chart for British Business Bank plc and its subsidiaries can be found on the British Business Bank plc website.