Inclusive financing: North East Fund aims to bridge gender gap in SME funding

Since its launch in 2018, the North East Fund has made a £340m impact, creating over 2,500 new jobs. With funding still available, the North East Fund, a suite of five funds supported by the European Regional Development Fund, is looking for more female-led businesses in the region to apply for investment.

SMEs play a pivotal role in shaping the economies of both North East England and the United Kingdom as a whole, accounting for three in five jobs. At the same time, around one in five businesses in the UK are women-led.

In addition to being fewer in number, women-owned businesses consistently face disparities in accessing loan and venture capital funding. This creates a substantial gap in financial support compared to their male counterparts, something the North East Fund tries to help to address.

These businesses are contributing to job creation, fostering innovation, and driving economic growth, adding to the overall resilience and dynamism of the region which remains the best for female-founded start-up companies in the UK.

Jason Hobbs from the North East Fund commented: “The gender imbalance in investment through loan and equity funding is an important issue with broader implications.

“Underinvesting in women-led ventures not only limits the economic empowerment of half the population, it hinders the potential for diverse perspectives and unlocking significant regional growth through innovation.

“Roughly one in three of our investments have been in female-founded, co-founded and/or managed businesses. Bridging the gender funding gap by investing in more women entrepreneurs is not just a matter of equality, it simply makes good economic and financial sense.”

The North East Fund and its four fund management delivery partners are all signatories to the Investing in Women Code, which requires a commitment to support the advancement of female entrepreneurship by improving female entrepreneurs’ access to tools, resources and finance from the financial services sector.

Hekla Goodman, Investment Manager at Northstar Ventures, said: “We aim to invest our capital into mixed gender teams as we consider these will be the most successful. As a venture capital investor, we champion women and have some very successful female-led businesses in our portfolio including Magnitude Biosciences and Low Carbon Materials.

“We offer support to our portfolio and the wider technology ecosystem. The North East is a great place to set up and grow a business, and the more entrepreneurs supporting that narrative will give others the confidence to bring ideas to the forefront and raise investment.”

By Matthew Neville – Senior Correspondent, Bdaily

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