In this series we ask key spokespeople from across the region and from our core sectors to share their insights.
This time we chat to Melanie Ellyard, Senior Manager for Yorkshire, Humber and Tees Valley, UK Network for the British Business Bank about the current funding landscape for business in our region and what she sees should be our key priorities for future growth.
What are the current opportunities for business across our region?
The good news is that we’re seeing good take up of the Start Up Loans programme, many from those who have been hardest hit by the pandemic, particularly young people, women and people from ethnically diverse backgrounds. Statistics on Yorkshire and The Humber 2021 inform us that 950 drawdowns have been made, £11,021,143 lent, equivalent to 2 businesses backed per day. The split is roughly 40% women and 60% across the region and 11% of applicants were unemployed before applying. Leeds, Bradford, Wakefield, Kirklees and York are amongst the top drawdowns by Local Authority.
Some have been forced into that career path through redundancy and others have used lockdown to consider new routes and challenges, but there is a vibrant community of entrepreneurs and early-stage businesses across the region who are ripe for investment.
There is funding available through many other means such as the Northern Powerhouse Investment Fund who offer microfinance £25k-£100k, debt finance £100k-£750k and equity finance £50k-£2m to regional aspiring businesses.
So how can the British Business Bank help those businesses access the funding they need?
We’re not a direct lender – the Business Bank is a Government-owned economic development bank dedicated to making finance markets work better for small businesses. We fund the funders and currently have some 180 delivery partners working with us, from the larger high street banks, to smaller and challenger banks, venture capital providers and alternative finance providers.
The bank is the Government’s centre of expertise on Small and Medium Enterprises (SME) Finance. My role, within UK Network is to work at a regional level to build a picture of what is happening through regular contact with intermediaries, including Local Enterprise Partnerships, Chambers of Commerce, the Federation of Small Businesses, Institute of Directors, professional services providers, universities, growth hubs, accelerators and incubators, to understand and help address any regional challenges and imbalances in SME access to finance.
I also work closely with harder-to-reach communities to gauge their views and give vital feedback. The bank has targeted stakeholder engagement with government officials, HM Treasury and Department for Business, Energy & Industrial Strategy. So, it is very important that we get regional representation from all SME communities. Once a key theme has been, identified working groups made up of local partners are formed to drive impact across the region.
As a region, we have a wide and highly developed financial ecosystem, which has thankfully moved from being very disjointed, when I first became involved (many years ago), to being much more interconnected. What we must do is ensure that everyone who needs funding support is able to access that ecosystem and be able to identify the right source of funding for their particular needs. And that is an ongoing challenge!
And what can businesses do to help themselves be investor-ready?
We all have a part to play in bringing the region’s financial ecosystem closer together; but for entrepreneurs and early-stage businesses, it’s about making it easier for investors to invest.
Much more than polishing the pitch deck, it’s about looking at your wider potential as a business; what you can become. Building out your networks is an essential part of that process, which is where innovation hubs like Nexus play a vital role.
Engaging with events such the West Yorkshire Innovation Festival and programmes such as BUILD delivered by MIT REAP, Connecting Innovation from the LEP, ADVENTURE and RTC North is a brilliant way for business owners and would-be entrepreneurs to receive vital advice and guidance from experts and fellow businesses as well as to connect with individuals and organisations who could provide vital future support.
It’s tempting to look at investment success over the Pennines or in the South with envy, but we should look closely at what is behind those investments, what lessons we can learn and how we can replicate those successes here. That’s often about collaboration, networks and community.
What would you most like to see happen in our region to drive future growth?
We have to be more ambitious and make sure that we get noticed.
Our region is home to world-leading companies in technology, life sciences, healthcare, professional services, and the digital sector, with a vibrant community of young entrepreneurs.
I have noticed a significant increase in success stories and case studies from the Northern Powerhouse Fund Managers over the last 12 months. To date, the fund has invested £237m across 1,068 deals, which have attracted an additional £288m in private sector funding. This is an incredible achievement and all the funds are doing a sterling job of spreading the word via social media. However, I feel we could all amplify the hard work I see happening in our ecosystems, by sharing the ideas, the achievements and the success stories not only across our networks, but across the UK and globally. Really put Leeds City Region and our talent and assets on the map.
I would love to see a Round Table scheduled, with all the relevant bodies and advisors, to discuss how we can put our region’s businesses firmly on the national and international map – and what role everyone of us can play in achieving that ambition.
In the meantime, if any organisations working closely with SMEs would like to discuss ways to improve SME access to finance in our region then I would love to hear from them.
Explore more insights from our ‘the view from here’ series:
The view from here – Mark Goldstone, Chamber of Commerce
In the latest edition of our blog series we speak to Mark Goldstone, Head of Business, Representation and Policy at the West & North Yorkshire Chamber of Commerce about business confidence in the region and the opportunities around devolution.