North East Mayor Kim McGuinness today launched a drive to create 2,300 new jobs by helping small businesses in the region thrive and grow.
The Mayor’s new North East Investment Fund includes £70 million of new money from the Combined Authority to support innovative new businesses and help small firms take the next big step to success.
In total, the venture capital fund could unlock a total of £350 million investment over 15 years, including private sector co-investment of £170 million, with the aim of supporting at least 470 regional businesses and creating 2,300 jobs.
North East Mayor Kim McGuinness said: “Small businesses are the beating heart of our economy and I want to help them grow and create thousands of new jobs and real opportunity in the local high streets, back lanes and trading estates across our region.
“That's why we are investing £70 million to unlock the support we have been missing to fund young business growth, create jobs and support the brilliant and creative people who just need funds to take the next big step to success.
“We have no time to waste to grow our economy, so I want to see this new North East Investment Fund striking its first deals within weeks.”
The new fund will provide investment in the form of equity and lending and enable growth of regional businesses who are underserved by the mainstream finance market.
First investments by the fund are expected to be made by summer this year, subject to the Cabinet of the North East Combined Authority approving its creation at a meeting on 18 March.
A report to the cabinet meeting set out the need for a suite of regional funds which will support innovative new businesses and catalyse business growth.
Research with small and medium businesses found gaining venture capital to grow was a key challenge, because of the historically low availability of investment to develop businesses in the North East compared to London and the South East.
The new Investment Fund reflects the importance of supporting new, spinout and growing innovation-intensive companies for the region’s economic growth and ambitions to create a growing and vibrant economy for all.