Member Article

Enterprise Ventures reports record 2013 with £29m invested

Enterprise Ventures, which provides equity and debt finance for SMEs, invested £29m in small businesses in 2013 – up £5m on the previous year and another record for the fund manager.

The number of transactions rose from 167 to 211 while the total value of Enterprise Ventures’ funds under management increased from £130m to £140m.

The figures highlight Enterprise Ventures’ role as one of the UK’s most active SME investors, and one of the few which regularly supports businesses with under £10m turnover. Over the past three years the company has invested a total of £73m in 555 transactions– equivalent to one deal every working day.

Significant deals during 2013 included the £6m management buy-out of Winderpower, the Leeds-based manufacturer of power distribution and generation equipment; the acquisition of North West coachbuilders Woodall Nicholson Group; a major investment into Knight Warner Limited, the Chesterfield-based manufacturer of process automation equipment; and the £3.8m buy-out of Blackburn-based Granby Marketing Services, a leading response and fulfilment house.

Enterprise Ventures, which has offices in Manchester, Preston, Liverpool and Barnsley, manages 14 specially-targeted SME funds raised from the public and private sectors providing venture capital, growth capital and loans. They include The North West Fund for Venture Capital, The North WestFund for Mezzanine, Lancashire’s Rosebud Fund, the Finance Yorkshire Seedcorn Fund and Small Business Loans Fund, and the Coalfields Funds.

Chief executive Jonathan Diggines says that recent Bank of England figures, which showed that net lending to SMEs continued to fall in 2013, came as no surprise.

He said: “Despite a blizzard of bank and government initiatives and announcements, clearing banks have had little appetite to lend to SMEs, and in particular to recently-formed small businesses with under £10m turnover.”

“SME investors need on-the-ground expertise so that they can understand the needs of each business and provide support. Enterprise Ventures is one of the few fund managers providing finance to businesses of this size. We have supported some really great businesses in 2013 – both start-ups with new ideas and technologies, and experienced management teams in traditional industries. Many of the businesses we have backed would otherwise have failed to raise the investment they need.”

Diggines says that he expects that economic recovery will lead to greater demand for funding, but there will be uncertainties: “Demand for funds is likely to rise in 2014, but two questions will dominate – will there be the funds available to meet the increased demand, and what will be the effect when interest rates start to rise, as will inevitably happen? One certainty is that Enterprise Ventures will continue to seek out and support promising small businesses during 2014.”

This was posted in Bdaily's Members' News section by Graham Vincent .