invest north east england

One North East and its partners can provide advice on the most appropriate funding and can also bring together funding partners to provide packages to match your business needs.

Key funding channels include:

Finance For Business Funds

A new £125 million Finance for Business ‘super fund’ is now available to small and medium-sized companies in the North East over the next five years.

The fund management firms providing the packages that comprise Finance for Business are:

• North Star Equity Investors - the £15 million Technology Proof of Concept Fund and the £20 million Seed Fund.
• IP Group - the £25 million Technology Fund.
• Rivers Capital Partners - the £7.5 million Angel Match Fund.
• Finance Wales Investments - the £20 million Growth Fund 500.
• NEL Fund Managers - the £20 million Growth Fund.

The remaining £17.5 million will be available to top up the existing funds, with some earmarked for a potential micro finance fund.

Grant for Business Investment (GBI)

The primary grant for inward investors, which in 2007-08 invested £18 million into over 100 firms, potentially creating and safeguarding almost 4,200 jobs. GBI is a discretionary grant and most manufacturing businesses are eligible to apply, as are businesses in service industries that supply a national rather than local market.   Applicants can be all sizes of companies, partnerships or sole-traders; however the grant is not available to simply transfer jobs from one part of the country to another. Assistance can be provided to:

• Expand your business operations into the UK
• Upgrade, improve or redevelop existing premises to suit your business needs
• Set up research and development facilities

The aim of the scheme is to encourage investment in projects that lead to long-term improvements in productivity, skills and employment. Assistance is given in the form of a grant. The value of the grant would be based on your project’s capital expenditure costs and the number and quality of jobs it is expected to create or safeguard. 

GBI facts

• Eligible costs include land purchase; site preparation and buildings; plant and machinery
• Other costs such as patent rights, professional fees, training costs, installation and reinstallation of machinery may also qualify 
• 63% of North East England’s population live in an assisted area

GBI criteria

• Small and medium sized enterprises (SMEs) can apply throughout the North East region.  You should check your SME status by referring to the SME Self Declaration booklet on the GBI website.
• Large enterprises can apply within an Assisted Area. This can be checked using the Postcode finder on the GBI website.
• Projects must have adequate funding from internal or other private sector sources
• Projects must not proceed prior to an offer of a grant being made
• Projects must not cause job displacement within the UK
• Supply a national rather than a local market

R&D Grant Funding

Grant for Research and Development (GRD) is a scheme to help individuals or small and medium sized enterprises (SMEs) improve their competitiveness by developing new products or processes.

Grants are offered, at the discretion of government, to help businesses carry out research and development work that will lead to technologically innovative new products or processes that the company can exploit in the marketplace.  Applications can be made at any time to meet your business needs.

R&D Grant Funding facts

• The programme allows companies to apply for up to 60% of their R&D costs
• There are a number of elements of grant support covering both Research (60% support) or Development activity (up to 40% support)
• Grants can assist the costs of work carried out investigating the technical and commercial feasibility of innovative new technologies up to pre-production prototype
• A new element to the scheme has been introduced to support Pre-R&D Proof of Market research in to the commercial and technical potential of a new product idea
• One North East has managed the Grant for Research and Development scheme since 2005, providing grants of around £2.5m per year to regional SMEs

One North East is also trialling a Large Company R&D Grant support scheme, to assist North East branches of large companies to carry out collaborative R&D projects to develop new products and to raise regional R&D capacity. Grants can be provided up to 50% of costs for Research projects, or up to 25% of costs for Development projects.

Grants for Research and Development

The DTI’s Grant for Research and Development is aimed at individuals planning to start up businesses in England and at small and medium sized enterprises (SMEs) already operating in England. The grants are offered, at the discretion of government, to help businesses carry out research and development work that will lead to technologically innovative products or processes.

Proof of Concept Fund

The North East Proof of Concept (POC) Fund invests in pre-start, early stage or more mature science and technology-based companies. Such companies are frequently led by committed entrepreneurs who, due to the unproven state of the technology, lack the ability to raise finance through conventional means such as banks and are too early to attract venture capital investment. The POC Fund helps plug the equity gap faced by companies in their very earliest stages, where risks are high. Investments are made up to £60,000, with a maximum of £90,000 for university pre-start projects. The POC Fund investment takes the form of a convertible loan.

Co-Investment Fund

The £23 million Co-Investment Fund specialises in high growth technology opportunities in North East England.  Investments of between £100,000 and £1.5m are drawn from a strong network of co-investors, including business angels, corporates and other venture capital firms.

The Co-Investment team offers a unique combination of science, technology, commercial and venture capital skills and works closely with entrepreneurs at every stage of their company’s development to realise their full potential.

To find out more about raising finance, contact our Inward Investment Support Team.