£40 million available for small firms
May 23 2006
Two new Enterprise Capital Funds worth £40 million have been announced by the Small Business Minister Margaret Hodge to help small businesses trapped in the so-called equity gap to fund growth.
Enterprise Capital Funds (ECFs) aim to address the lack of equity capital in the £500,000 to £2 million bracket, in which a number of businesses struggle to raise the finance necessary for expansion. ECFs invest a combination of private and public money.
'These new funds will help many small businesses that might otherwise have been unable to develop their potential because there was no equity finance available to them,’ explains Hodge. ‘These funds demonstrate how the Government is actively working with private investors to create an environment where British businesses are given the world-class support they need to succeed.'
The lion’s share of the new money is provided by the Seraphim Capital Fund, a £30 million generalist co-investment fund that will invest alongside leading business angels and other private investors. The fund will be managed by a coalition of business angel networks and will focus on investments in companies throughout the UK predominantly in the early stages of development.
Focused more on early-stage technology businesses, the Amadeus Enterprise Capital Fund provides the remaining £10 million and will be managed by Amadeus Capital Partners, one of the country's leading investors in the technology sector.
These will join two existing ECFs announced in March 2006: The £25 million IQ Capital Fund, focused on technology-based SMEs needing investments of up to £1.5 million; and 21st Century Sustainable Technology Growth Fund, a £30 million fund which will operate across the UK and focus on high growth companies employing leading edge sustainable technology
To find out more, contact the ECF team at Small Business Service, Investment Directorate, St Mary's House, 9-11 London Road, Sheffield S2 4LA, Tel: 0114-279 4363, Fax: 0114-279 4375, email: enterprise@sbs.gsi.gov.uk.
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