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23rd February 2021

NPIF: Funding innovation in the North

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Northern Powerhouse Investment Fund

Sue Barnard, senior manager at the British Business Bank, looks at how the Northern Powerhouse Investment Fund is at the heart of growth and recovery, supporting SME’s, emerging sectors and driving innovation across “traditional” business.

The North of England is famed for its ingenuity and innovation. It is world-renowned for inventors who brought the world computers, steam locomotives and the discovery of stainless steel, not to mention being the birthplace of the Industrial Revolution.

Today, that Northern spirit remains unchanged as our dynamic community of entrepreneurs and SMEs continue to pave the way for economic growth. As the UK and wider world looks to recover from the pandemic, ensuring businesses have the means to grow, innovate and adapt sustainably will prove decisive.

The Northern Powerhouse Investment Fund is at the heart of that growth and recovery, supporting small businesses of all shapes and sectors across the North. To date, NPIF has made 1,029 investments at a total of £227m, attracting an additional £253m of private sector investment. According to the British Business Bank’s Small Business Equity Tracker, NPIF was responsible for 16 per cent of all equity deals in the North during 2019.

Supporting emerging sectors

Whilst we look to secure the future of existing businesses, in doing so we must ensure that   Northern businesses inventing new technology, solutions and products are not forgotten. Jobs of the future are dependent on these innovators and it is critical that they are supported. In its first four years, NPIF has been doing just that, providing vital finance to organisations in emerging sectors such as life sciences, fintech and artificial intelligence, amongst many others.

There are already many examples of this in action. Manchester-headquartered water treatment technology business G2O Water Technologies Limited (G2O) uses graphene-based coatings technology to provide high quality and cost-effective solutions to a broad range of filtration applications. Following two rounds of funding from NPIF – Maven Equity Finance, the Manchester-headquartered business has scaled considerably, with a new lab at Sci-Tech Daresbury that has expanded operating space by 60 per cent and created new highly skilled jobs.

At an earlier stage in its growth journey is Leeds-based Slingshot Simulations – a ‘digital twin’ technology start-up that has raised £1.5m in funding, provided in part by NPIF – Mercia Equity Finance. Already being used as part of a government trial to help reduce traffic congestion and air pollution in Northern cities, funding is set to allow the business to scale its operations and roll out to its first commercial customers. Not only is its innovative approach set to benefit its future employees in the local area, but it is providing a new, previously unavailable service to the rest of the region.

Innovating across ‘traditional’ business

Whilst trailblazers certainly have their place, innovation is not solely reserved to new start-ups. Successful businesses operating in ‘traditional’ sectors, such as manufacturing, construction and retail, are continually looking to innovate and adapt. New inventions such as artificial intelligence, virtual reality and other technological advantages are helping to take businesses to the next level as they look to improve efficiency and improve existing operations.

Innovation has never been more key than since start of the pandemic, as a complete shake-up of how we live and do business continues to create new challenges that require initiative, flexibility and in many cases funding to solve. Whilst for some it has been a matter of adapting to keep growth on-track through minor adjustments, for others it has meant bouncing back following disruption or even temporary closure.

Over the past year, we have seen many examples of businesses successfully utilizing NPIF funds to do just that. Take Liverpool-based General Trade Maintenance Limited (GTM Property Maintenance) as an example. Despite having a healthy forecast of work scheduled for the remainder of 2020, the pandemic severely affected its supply chain and forced the company to temporarily close its doors. Following a £250,000 NPIF – FW Capital Debt Finance loan, backed by CBILS, the business has been able to reopen and rebuild a new business pipeline, in turn securing 20 permanent jobs and those of 10 contractors.

Another example of this is Middlesbrough-based Wilton Engineering, that received a £750,000 NPIF – FW Capital Debt Finance loan backed by CBILS. In doing so, not only was the engineering firm able to safeguard 117 roles, but it has since created an additional twenty, bringing forward plans to diversify its services and enter new markets.

Innovation is the key to unlocking the true potential of the North and this will continue to be the case beyond immediate impact of the pandemic. I would urge any business that may be seeking funding make contact via www.NPIF.co.uk where you can find more information on what support is available in your Northern Powerhouse region.

The Northern Powerhouse Investment Fund project is supported financially by the European Union using funding from the European Regional Development Fund (ERDF) as part of the European Structural and Investment Funds Growth Programme 2014-2020 and the European Investment Bank.

Editors Notes

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