The fund will operate under the Government-owned British Business Bank and is managed by the FSE Group and SWIG Finance. It is anticipated that the fund will unlock a further £40m from private investment, helping to create a revolving investment fund to which businesses can apply for start-up and growth investment into the future.
With funding from the European Regional Development Fund (ERDF), Growing Places and BEIS, the CIoS Investment Fund has been created to offer an alternative debt and equity source for growing SMEs. Market research has highlighted a gap in the provision of debt and equity finance in Cornwall, and access to finance is a much higher barrier to growth than the average. It addresses an equity gap in start-up, early stage and development capital and will help high growth businesses unable to obtain finance from traditional sources.
The debt investment strategy is to make debt finance available to growing businesses in Cornwall and the Isles of Scilly that are unable to access debt finance from commercial sources due to a lack of collateral or track record, but have a viable business proposal. 50% of the fund will be in the form of debt finance (approx. £20m) with loans between £25,000 and £1.0m.
The remaining 50% of the fund will make equity finance available to growing companies that are unable to access this form of investment. Equity funding will range between £50,000 and £2.0m, and there will be some restrictions on the number of larger equity investments to ensure a spread of investments and to deliver ERDF output targets.
The fund manager will seek co-investment on a deal by deal basis. They will also have the flexibility to move funding from equity to debt and vice versa if economic circumstances change and/or the fund’s performance justifies or requires a change of focus.
For more information from the fund manager, visit www.ciosif.co.uk . To discuss how we can support you in raising finance to support your business, contact Ewan McClymont, Director Grant Services on 03333-219000 or email email@example.com .