By James Bedford
Powerhouses are fuelled by investment capital, creating growth from opportunity; the ‘Northern powerhouse’ will be no different. How can the flow of investment meet the requirements of a fast growing tech sector?
Access to finance is repeatedly highlighted as being a key barrier to growth for tech companies and is more pronounced in the North of England, as noted in reports such as Tech City Futures (2013), Tech Nation (2015) and Silicon Cities (2014).
Issues preventing tech companies from securing the right investment affect the whole market from angel investment through to VC investment, including publicly financed models. There are also far fewer accelerator programmes in the North of England compared to the South East, reducing the focal points for startups and investors. The investment activity that does happen tends to take place under the radar, making it difficult to demonstrate how many great opportunities there are.
Investment opportunities in the North of England are dominated by the three JEREMIE funds and the recently created British Business Bank. We want to see more competition in the VC market and stimulate angel activity to meet the demand for finance from tech startups and scaleups. We believe that investment opportunities are not being fulfilled. Now is an opportune moment to influence the discussions on future investment structures.
Over the past few months Tech North has been leading a discussion with representatives from across the North to build support for a pan Northern Co-investment fund.
A publicly funded pan Northern Co-Investment fund will provide the essential infrastructure required to attract more private investment to the North, creating richer and healthier investor networks.
We have now engaged with representatives in all 7 city regions and will be working over the coming months to drive forward our call for funding and partners to establish the fund.