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Investment opportunities knock for Sunderland businesses
Growing businesses across Sunderland are being invited to a business breakfast next week to learn about early stage investment opportunities here in the North East.

The event will give SMEs throughout Sunderland the chance to find out how they can benefit from the new £125 million Finance for Business North East programme (FBNEF).

The groundbreaking fund is an exciting portfolio of six investment funds set up to drive economic growth by providing vital access to finance for hundreds of SMEs over the next five years.

The business breakfast will take place at the North East Business and Innovation Centre (BIC) in the city on Thursday June 10 beginning at 8.30am. It is organised by North East Finance (NEF) which is managing the FBNEF programme.

Andrew Mitchell, chief executive of NEF, said: “This is a perfect opportunity for Sunderland’s businesses to explore the growth and investment opportunities that are available on their doorstep. The fund is the first of its kind in England and will provide vital investment to hundreds of fast growing SMEs at a time when we are emerging from recession.

“Interest in the funds is already very good. The first investments have been made and there are many excellent businesses in Sunderland that can benefit. We’re delighted to be working with the BIC to spread the message to SMEs and entrepreneurs who will have the opportunity to speak to our fund managers and find out how they can benefit.”

For more information about the road show and to book a place at the event, please contact Stephen Warren at North East Finance on 0191 211 2300 or email: stephen.warren@northeastfinance.org

Firms flock to region as new Euro fund pays dividends
HUNDREDS of jobs could be created in the North East as firms from across the country are being lured to the region by a pioneering new business growth fund.
Nearly 100 companies from outside the region have applied for money from the £125m venture capital fund and said they would move to the North East if their bid was successful.

The Finance for Business North East Fund (FBNEF) was set up in January with the aim of helping around 850 companies create 5,000 jobs in this region over the new five years. It is the first such fund in the country.

So far North East Finance, which is co-ordinating investments through FBNEF’s six venture capital funds, say there have been over 500 enquiries – of which around a fifth are from firms looking to relocate to the region. Andrew Mitchell, chief executive of North East Finance, said: “This development has the potential to be hugely beneficial to the region. The message is getting through across the UK that the North East is prepared to support growing and start-up businesses.
“Clearly in the past we have suffered from not having the venture capital funds available to support businesses but the new money has changed that perception.

“This is not about encouraging companies to come to the region so they can get funding. We are talking about companies which can establish a clear business case for investment from one of the funds, and then show their willingness to relocate to the North East.”

Newcastle-based North Star Equity Investors is managing two of the six funds and it says it has received a large number of enquiries from firms outside the region.

Its chief executive Marion Bernard said: “We are receiving enquiries from across the UK and internationally and this has major potential benefits for the region.

“If we can attract high quality global companies to set up in the region we may be able to help create a cluster of similar businesses around one business type leading to the development of global centres of expertise in the North East.”
Last year North Star invested £350,000 into Windsor-based retail price comparison website Cogenta Systems which led it to open a Newcastle base which will be a platform for its European expansion.

Barrie Hensby, chief executive at Newcastle-based NEL Fund Managers which runs another FBNEF fund, said: “Such outside interest clearly underpins the view of North East England as a region in which companies can see themselves thriving, and backs up the premise of the wider FBNEF scheme of enhancing the regional economy in a sustainable, long-term way.”

FBDNEF, originally named Jeremie, is funded with £62.5m from the European Investment Bank, £44.25m from the European Regional Development Fund 2007-2013, and £18.25m from regional development agency One North East.
Malcolm Page, One North East deputy chief executive, last night hailed the level of interest.

“The speed and reach of modern communications means that news of FBNEF has generated significant interest not just across the region but the UK as well,” he said. “It is inevitable that companies from outside the North East will express an interest in it – just as companies from across the UK have in the past gravitated towards venture capital funds delivered in London and south east England.”

He added: “The fund is solely focused on supporting North East businesses – we are primed to help up to 850 regional firms over the next five years which will spearhead new economic growth.”

First North East ‘super fund’ investment
Gateshead based Eutechnyx wins investment for ambitious expansion plans A £125m ‘super fund’ has made its first investment into the North East economy - with ambitious Gateshead-based games development company Eutechnyx receiving backing to develop groundbreaking titles and crack the free-to-play games market.

The £650,000 investment into Eutechnyx from the Finance for Business North East Fund is being managed by venture capital firm NorthStar Equity Investors (NSEI).

The funding allows Eutechnyx to finalise the development of a ground-breaking new title set to revolutionise the racing genre, as well as finance the development of its forthcoming free-to-play infrastructure ‘Auto Club Revolution’, as the company expands into the world of casual online games.

NSEI managed the investment from the North East Accelerator Fund - one of a suite of six funds that sits within the Finance for Business North East Fund (FBNEF). The £125m fund will support loans and equity investments into around 850 businesses, creating more than 5,000 new jobs over the next five years, which will help lead forward regional economic growth.

Eutechnyx is one of the largest independent videogame developers in the world, specialising in console-based driving games since 1987, with titles such as Ferrari Challenge, The Fast and the Furious and MTV’s Pimp My Ride. Eutechnyx has also secured investment of £5.2m from Prime Technology Ventures, a Dutch based technology investor, to aid its development plans.

Brian Jobling, CEO of Eutechnyx, commented:“We are thrilled to have secured this investment. As an independent developer, this injection will help us to continue to forge our own destiny within a rapidly changing games industry. Not only does the investment enable us to continue to innovate, we can continue to do so on our own terms. The Finance for Business North East Fund support means a lot to companies like Eutechnyx and to start-ups all over the North East.”

Malcolm Page, One North East Deputy Chief Executive, said: “This investment into Eutechnyx marks an important milestone in the evolution of the Finance for Business North East Fund. It is the first of what will be hundreds of investments into exciting growing North East companies which will underpin the regional economy as we enter renewed economic growth.”

Jose Palma Andres, European Commission Director for ERDF operations in the UK, said: “We are absolutely delighted to have supported Finance for Business North East. We are confident that this investment will be the first of many - paving the way for the success of the various funds and a sustainable basis for future risk capital operations in North East England.”

Simon Brooks, European Investment Bank Vice President responsible for the UK, said: “The European Investment Bank congratulates Eutechnyx on being the first recipient of funding from the £125m Finance for Business North East Fund. We welcome their contribution to the knowledge economy and creating specialist jobs in the region, and look forward to seeing similar success stories in the near future.”

Andrew Mitchell, chief executive of North East Finance, which oversees investments from FBNEF, said: “We’re delighted to see the first investment successfully completed. The volume and quality of funding applications so far has been very high and we anticipate more deals following on from the other funds very soon.”

Alasdair Greig, Investment Manager of NSEI, added:“The North East Accelerator Fund was set up to help companies invest in their future growth at an early stage in their development. This investment in Eutechnyx, an exciting growth company and good demonstration of the digital media skills in the North East, is the perfect example of what the fund is all about, and as such, a fitting inaugural investment.”

NSEI, with its experience of identifying and supporting early stage companies, was chosen to manage the North East Accelerator Fund. The wider Finance for Business North East Fund will invest in companies and pre-start enterprises in any sector (other than those operating within the Excluded Sectors as defined in the Fund Management Agreement) at an early stage of their development, i.e. predominantly at the start-up and seed capital stages.

New £125 million super fund hits the road
Early stage investment opportunities in North East England will be top of the agenda at a road show taking place in Leeds this week.

The event will give Yorkshire’s financial and professional advisory community an early opportunity to find out more about the new £125 million Finance for Business North East programme.

The groundbreaking super-fund is an exciting portfolio of six investment funds set up to drive economic growth by providing vital access to finance for hundreds of SMEs over the next five years.

The road show will take place at the Malmaison Hotel in the city on Thursday May 27 beginning at 6pm and is organised by North East Finance which is managing the new programme.

Finance for Business aims to invest £125 million into a broad spectrum of businesses located in the North East through loans and equity investments designed to drive growth. It will invest in around 850 businesses by 2014, targeting start-ups, technology-based businesses and growing companies across all eligible sectors.

Andrew Mitchell, chief executive of North East Finance, said: “This is a perfect opportunity for people to explore the growth and investment opportunities in North East of England. The Finance for Business North East programme is the first of its kind in England and offers a unique resource to growing businesses at a time when we are emerging from recession,

“We have a strong track record in developing and managing successful investment funds in the North East. The new funds build on this and we’re keen to spread the message to ambitious SMEs and entrepreneurs.”

The fund’s creation has been made possible by a unique collaboration with the European Investment Bank (EIB), based in Luxemburg, which is contributing £62.5 million to the programme. The European Regional Development Fund (ERDF) and regional development agency One North East (ONE) have jointly invested a further £62 million.

The £125m pot is divided into six separate funds, each targeted at specific sectors and business types. The funds are overseen by five FSA-regulated venture capital fund managers, which have been carefully chosen for their proven track records of managing and delivering high profile equity and loan investments. They include:

The £15m Proof of Concept Fund and £20m Accelerator Fund which are managed by NorthStar Equity Investors
The £25m North East Technology Fund run by IP Group
The £7.5m Angel Fund managed by Rivers Capital Partnership
The £20m Growth Plus Fund managed by FW Capital
The £20m Growth Fund which is run by NEL Fund managers.

For more information about the road show and to book a place at the event, please contact Dawn Dunn at North East Finance on 0191 211 2300 or email: dawn.dunn@northeastfinance.org

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