Regional funders’ vital role in economic stabilisation
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Uncertainty sends shivers through economic and financial institutions. Whatever the outcome of Brexit negotiations, it is essential for businesses and those who support them to mitigate the yo-yoing of markets caused by this year’s EU Referendum.
Regional funders have an essential role to play at this time to help provide confidence and stability to the SME market.
‘In times like these it is our responsibility to maintain the liquidity of the economy,’ says Finance Wales CEO, Giles Thorley. He heads up the Finance Wales Group, one of the largest regional investment companies in the UK. Owned by the Welsh government, it was originally set up as an investment vehicle to address the funding gap for SMEs in Wales. The company now includes FW Capital, a fund manager for the North West and North East of England, and the Wales business angel network xénos.
‘We’re still open for business. Our funds come from a variety of public and private sector sources. We can partner with a wide range of investors and support both B2B and B2C markets. Businesses can be assured there are still a wide variety of financing opportunities available to them. We’re looking forward to the timely launch of the £136m Wales Business Fund with WEFO later this month: it will bring the total amount of funds we manage in Wales to just under £700m,’ Thorley adds.
Established in 2000, Finance Wales has experience of working through difficult economic times. The company achieved record levels of investment during the last financial crisis and is aiming to provide confidence and consistency in the wake of Brexit uncertainty with an open door policy for SMEs based in Wales.
‘Our flexibility is our USP in many ways,’ says Investment Director Rhian Elston. ‘We can invest from £1,000 to £3m per round across sectors and all stages of a business’s lifecycle. The support is there for businesses - now they have to think more globally and seek more overseas opportunities. We’ve seen great success stories like tech start-up Biomonde who we co-invested in as a spinout and thanks to subsequent rounds have now launched their product in the US.’
The company has impressive portfolio funds to draw on. A number provide specialist support. These include the Wales Management Succession Fund, the Wales Property Development Fund and the Wales Technology Seed Fund; with an in-house Technology Investment Ventures team managing funding for technology-based companies.
The Wales Business Fund was launched on 21 September 2016 with regional events around Wales. The fund can support debt and equity packages from £50,000 up to £2 million for SMEs based in Wales.
‘The fund will be a great boost for SMEs in Wales and will increase our long-term ability to attract and support businesses,’ concludes Elston. ‘Companies need to remain proactive and take advantage of the support that’s available; often businesses who invest against the trend during economic difficulties perform best in the long-term.’