Launch of £660m Northern Powerhouse Investment Fund II set to cover entire North East

Aiming to build on the success of the initial fund, which facilitated over £1 billion of direct and private sector co-investment across the North, the Northern Powerhouse Investment Fund II will enable businesses across the North to access the Fund to start up, scale up or continue on their growth journey. NPIF II will drive sustainable economic growth by supporting innovation and creating local opportunity for new and growing businesses.

The Fund will increase the supply and diversity of early-stage finance for Northern smaller businesses, providing funds to firms that might otherwise not receive investment and help to break down barriers in access to finance.

Covering the entire North East, NEL Fund Managers (NEL) will provide both smaller loans (£25,000 to £100,000) and debt finance (£100,000 to £2 million) to North East businesses with Maven Capital Partners managing equity deals up to £5 million.

With the NPIF II now reaching across the North East, it will target small businesses for investment, such as Newcastle-based Lemon Tree Softplay, which received funding from the British Business Bank’s Start Up Loans programme.

Joan Nga, co-founder of Lemon Tree Softplay Café, said: "Building up Lemon Tree Softplay Cafe has been a heartfelt endeavour, providing a sanctuary for families in the North East. The Start Up Loan has really helped turn our aspirations into a reality, as we establish Lemon Tree Soft Play café.”

Louis Taylor, Chief Executive of the British Business Bank, said: “The success of the first Northern Powerhouse Investment Fund has proven the instrumental change that access to finance can have for small businesses. From creating hundreds of jobs to developing ground-breaking products, we have seen companies that previously lacked funding options accelerate forward in their growth journeys, which has ultimately benefitted the whole of the Northern economy.

“This is why it was important to continue the Northern Powerhouse Investment Fund into its next phase. With further funding available, and a greater geographical reach in the North East, the Northern Powerhouse Investment Fund II will engage more stakeholders across the regions, bringing the business community closer together to create more opportunities for entrepreneurs everywhere.”

Following today’s official launch in Leeds, the British Business Bank will be holding a roadshow of events for small business finance intermediaries across the region to learn more about the Fund.