*Article orignally in the North East Times
North East business growth... driven by equity and loan finance says, Jonathan Gold, founding director of Rivers Capital Partners
I don't need to tell most of you that the North East is a great place to start a business.
My job is to try and add to that positive statement; it's my passion and I'd like to share it with you for a minute.
In the last 5 years well over 1000 businesses have applied for equity and loan finance from our two funds and more than 400 have received investment. Between the North East Angel Fund, Micro Loan Fund and our private investors, our investee businesses have received a total of about £20 million.
In fact the North East has probably had more venture capital and start-up finance invested here per head that any part of the UK. A large amount of this is due to the work of North East Finance in securing £142m of UK government and European capital back in 2009.
At the time of writing this, some £122m has been invested by all the JEREMIE funds in hundreds of SMEs across the North East. This investment has created almost 2,000 new jobs and safeguarded almost 3,000 across the region. In addition, a further £138m of funding has been leveraged into the region due to JEREMIE funding.
Most, if not all, business sectors have benefited from fund investments – whether in manufacturing, information and communications, professional, scientific and technical, services, along with administrative and support services. Investment has been spread across the region, although inevitably there have been clusters around our larger urban and industrial conurbations, which includes Tees Valley where we're also active.
Our Funds come from this source, plus the Business Angel investors we have brought along. My message today is to remind everyone we need to shout about the success of these Funds and the work that North East Finance has done in securing and managing the contracts with fund managers like me to find the businesses and make the investments.
The journey is not over as there is a further proposed £160m package for the region being planned at the moment to build on the current activity next year. These funds are important and I would urge people to support the case for these and the continuity of such investment finance for our regional businesses.
Yes, I want to manage more funds, so have a vested interest here but I am passionate about the success of our region. That's why I came here with my family in 2003 and have built Rivers Capital with my own and partners cash as a private venture firm doing what I know best bidding for and investing cash.
We are still very busy investing the remaining £2m of the Micro Loan, one bit at a time into small and micro businesses that just need simple loans from £1,000 to £25,000. The North East Angel Fund is also doing deals and we are working on helping the businesses we already have to make a success of the cash.
The Micro Loan process is a simple one designed for businesses just needing cash to buy some new equipment or help with working capital. All you need is a good little business, and customers paying you enough so you can convince us you can pay the interest and capital. We make decisions in 2 weeks from application and expect to make at least 200 loans this year.
The North East Angel Fund is traditional venture capital, money in exchange for shares in your business. Here we are risk takers and need you to be ambitious to grow. However, don't just think it's not for you, we are happy to have an early discussion to help you decide. Indeed for this and the Micro Loan Fund we provide free training courses to help you understand the whole area of raising cash. Look us up on the website listed below.
So next time someone says they can't find investment remind them it's out there, come and see us and put in a good word for North East Finance and the JEREMIE Funds with your MP, Euro MP, Council, LEP and the government.
Jonathan is the managing director and co-founder of Rivers Capital Partners; contact him on 0191 230 6370 or via www.riverscap.com